Income before income taxes and equity method earnings
70.2
1.7
356.5
448.9
Income tax expense (benefit)
14.3
(2.8)
90.5
112.3
Equity method investment earnings (loss)
9.6
(6.1)
51.8
29.3
Net income (loss)
$
65.5
$
(1.6)
$
317.8
$
365.9
Earnings (loss) per share
Basic
$
0.45
$
(0.01)
$
2.17
$
2.50
Diluted
$
0.44
$
(0.01)
$
2.16
$
2.49
Dividends declared per common share
$
0.235
$
0.230
$
0.930
$
0.860
Computation of diluted earnings per share:
Net income (loss)
$
65.5
$
(1.6)
$
317.8
$
365.9
Diluted weighted average common shares outstanding
147.1
146.2
147.1
147.1
Diluted earnings (loss) per share
$
0.44
$
(0.01)
$
2.16
$
2.49
Balance Sheet
Lamb Weston Holdings, Inc.
Consolidated Balance Sheets
(dollars in millions, except share data)
May 30,
May 31,
2021
2020
ASSETS
Current assets:
Cash and cash equivalents (1)
$
783.5
$
1,364.0
Receivables, less allowance for doubtful accounts of $0.9 and $1.3
366.9
342.1
Inventories
513.5
486.7
Prepaid expenses and other current assets
117.8
109.8
Total current assets
1,781.7
2,302.6
Property, plant and equipment, net
1,524.0
1,535.0
Operating lease assets
141.7
167.0
Equity method investments
310.2
250.2
Goodwill
334.5
303.8
Intangible assets, net
36.9
38.3
Other assets
80.4
65.4
Total assets
$
4,209.4
$
4,662.3
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Short-term borrowings (1)
$
-
$
498.7
Current portion of long-term debt and financing obligations
32.0
48.8
Accounts payable
359.3
244.4
Accrued liabilities
226.9
233.0
Total current liabilities
618.2
1,024.9
Long-term liabilities:
Long-term debt and financing obligations, excluding current portion
2,705.4
2,992.6
Deferred income taxes
159.7
152.5
Other noncurrent liabilities
245.5
252.3
Total long-term liabilities
3,110.6
3,397.4
Commitments and contingencies
Stockholders' equity:
Common stock of $1.00 par value, 600,000,000 shares authorized; 147,640,632 and 146,993,751 shares issued
147.6
147.0
Additional distributed capital
(836.8)
(862.9)
Retained earnings
1,244.6
1,064.6
Accumulated other comprehensive income (loss)
29.5
(40.5)
Treasury stock, at cost, 1,448,768 and 954,858 common shares
(104.3)
(68.2)
Total stockholders' equity
480.6
240.0
Total liabilities and stockholders' equity
$
4,209.4
$
4,662.3
(1) During the fourteen weeks ended May 31, 2020, the Company borrowed $1,320.0 million, including $495.0 million under its revolving credit facility, to increase its cash position and preserve financial flexibility considering the uncertainty in the global markets resulting from the COVID-19 pandemic.
Cash Flows
Lamb Weston Holdings, Inc.
Consolidated Statements of Cash Flows
(dollars in millions)
Fifty-Two Weeks Ended
Fifty-Three Weeks Ended
May 30,
May 31,
2021
2020
Cash flows from operating activities
Net income
$
317.8
$
365.9
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization of intangibles and debt issuance costs
188.8
184.0
Stock-settled, stock-based compensation expense
20.6
22.8
Earnings of joint ventures in excess of distributions
(33.0)
(0.4)
Deferred income taxes
3.8
20.0
Other
10.7
15.6
Changes in operating assets and liabilities, net of acquisition:
Receivables
(21.0)
1.1
Inventories
(22.0)
15.3
Income taxes payable/receivable, net
(3.3)
2.7
Prepaid expenses and other current assets
(4.9)
(2.0)
Accounts payable
104.7
(34.9)
Accrued liabilities
(9.0)
(16.1)
Net cash provided by operating activities
$
553.2
$
574.0
Cash flows from investing activities
Additions to property, plant and equipment
(147.2)
(167.7)
Additions to other long-term assets
(16.1)
(40.7)
Acquisition of business, net of cash acquired
-
(116.7)
Investment in equity method joint venture
-
(22.6)
Other
0.8
1.7
Net cash used for investing activities
$
(162.5)
$
(346.0)
Cash flows from financing activities
Proceeds (payments) of short-term borrowings, net
(498.8)
490.5
Repayments of debt and financing obligations
(305.5)
(336.3)
Dividends paid
(135.3)
(121.3)
Repurchase of common stock and common stock withheld to cover taxes
(36.1)
(28.9)
Proceeds from issuance of debt
-
1,122.9
Other
1.7
(1.9)
Net cash provided by (used for) financing activities
$
(974.0)
$
1,125.0
Effect of exchange rate changes on cash and cash equivalents
2.8
(1.2)
Net increase (decrease) in cash and cash equivalents
(580.5)
1,351.8
Cash and cash equivalents, beginning of the period
1,364.0
12.2
Cash and cash equivalents, end of period
$
783.5
$
1,364.0
Segments
Lamb Weston Holdings, Inc.
Segment Information
(dollars in millions)
Thirteen Weeks Ended
Fourteen Weeks Ended
Year-Over-
May 30,
May 31,
Year Growth
2021
2020
Rates
Price/Mix
Volume
Segment sales
Global
$
509.6
$
429.3
19%
3%
16%
Foodservice
320.0
175.8
82%
18%
64%
Retail
146.3
201.9
(28%)
2%
(30%)
Other
31.6
39.9
(21%)
5%
(26%)
$
1,007.5
$
846.9
19%
6%
13%
Segment product contribution margin (1)
Global
$
56.4
$
33.5
68%
Foodservice
96.3
42.5
127%
Retail
21.2
31.4
(32%)
Other
15.4
(1.9)
N/M
189.3
105.5
79%
Add: Advertising and promotion expenses
8.7
5.6
55%
Gross profit
$
198.0
$
111.1
78%
Fifty-Two Weeks Ended
Fifty-Three Weeks Ended
Year-Over-
May 30,
May 31,
Year Growth
2021
2020
Rates
Price/Mix
Volume
Segment sales
Global
$
1,911.5
$
1,973.6
(3%)
0%
(3%)
Foodservice
1,017.3
1,069.1
(5%)
7%
(12%)
Retail
603.4
595.5
1%
5%
(4%)
Other
138.7
154.2
(10%)
4%
(14%)
$
3,670.9
$
3,792.4
(3%)
3%
(6%)
Segment product contribution margin (1)
Global
$
306.2
$
374.5
(18%)
Foodservice
340.0
356.0
(4%)
Retail
120.2
117.6
2%
Other
47.8
24.1
98%
814.2
872.2
(7%)
Add: Advertising and promotion expenses
17.8
23.0
(23%)
Gross profit
$
832.0
$
895.2
(7%)
(1) Product contribution margin is one of the primary measures reported to the Company's chief operating decision maker for purposes of allocating resources to the Company's segments and assessing their performance. Product contribution margin represents net sales less cost of sales and advertising and promotion expenses. Product contribution margin includes advertising and promotion expenses because those expenses are directly associated with the performance of the Company's segments. Product contribution margin, when presented on a consolidated basis, is a non-GAAP financial measure. See "Non-GAAP Financial Measures" in this press release for a description of non-GAAP financial measures and the table above for a reconciliation of product contribution margin on a consolidated basis to gross profit.
Recon of Non GAAAP (1)
Lamb Weston Holdings, Inc.
Reconciliation of Non-GAAP Financial Measures
(dollars in millions, except per share amounts)
There were no items impacting comparability during the thirteen and fifty-two weeks ended May 30, 2021, or the fourteen weeks ended May 31, 2020. The item impacting comparability for the fifty-three weeks ended May 31, 2020, was as follows:
Fifty-Three weeks Ended May 31, 2020
Equity
Income
Income
Method
From
Interest
Tax
Investment
Diluted
Operations
Expense
Expense (1)
Earnings
Net Income
EPS
As reported
$
556.9
$
108.0
$
112.3
$
29.3
$
365.9
$
2.49
Items impacting comparability:
Loss on withdrawal from multiemployer pension plan
-
-
0.6
2.6
2.0
0.01
Total items impacting comparability
-
-
0.6
2.6
2.0
0.01
Adjusted (2)
$
556.9
$
108.0
$
112.9
$
31.9
$
367.9
$
2.50
(1) Income tax expense is calculated as the ratio of income tax expense to pre-tax income, inclusive of equity method investment earnings. Items impacting comparability are tax effected at the marginal rate based on the applicable tax jurisdiction.
(2) Adjusted income tax expense, equity method investment earnings, net income, and diluted earnings per share are non-GAAP financial measures. Management excludes items impacting comparability between periods as it believes these items are not necessarily reflective of the ongoing operations of Lamb Weston. These non-GAAP financial measures provide a means to evaluate the performance of Lamb Weston on an ongoing basis using the same measures that are frequently used by the Company's management and assist in providing a meaningful comparison between periods. See also "Non-GAAP Financial Measures" in this press release.
Recon of Non GAAP (2)
Lamb Weston Holdings, Inc.
Reconciliation of Non-GAAP Financial Measures
(dollars in millions)
To supplement the financial information included in this press release, the Company has presented Adjusted EBITDA and Adjusted EBITDA including unconsolidated joint ventures, which are non-GAAP financial measures. The following table reconciles net income (loss) to Adjusted EBITDA and Adjusted EBITDA including unconsolidated joint ventures.
Thirteen Weeks Ended
Fourteen Weeks Ended
Fifty-Two Weeks Ended
Fifty-Three Weeks Ended
May 30,
May 31,
May 30,
May 31,
2021
2020
2021
2020
Net income (loss)
$
65.5
$
(1.6)
$
317.8
$
365.9
Equity method investment (earnings) loss
(9.6)
6.1
(51.8)
(29.3)
Interest expense, net
28.7
29.2
118.3
108.0
Income tax expense (benefit)
14.3
(2.8)
90.5
112.3
Income from operations
98.9
30.9
474.8
556.9
Depreciation and amortization
44.2
45.2
182.7
177.8
Adjusted EBITDA (1)
143.1
76.1
657.5
734.7
Unconsolidated Joint Ventures (2)
Equity method investment earnings (loss)
9.6
(6.1)
51.8
29.3
Interest expense, income tax expense, and depreciation and
amortization included in equity method investment earnings
13.6
8.3
39.1
33.2
Items impacting comparability
Loss on withdrawal from multiemployer pension plan
-
-
-
2.6
Add: Adjusted EBITDA from unconsolidated joint ventures
23.2
2.2
90.9
65.1
Adjusted EBITDA including unconsolidated joint ventures (1)
$
166.3
$
78.3
$
748.4
$
799.8
(1) Adjusted EBITDA and Adjusted EBITDA including unconsolidated joint ventures are non-GAAP financial measures. Lamb Weston presents these measures because the Company believes they provide a means to evaluate the performance of the Company on an ongoing basis using the same measure frequently used by the Company's management and assist in providing a meaningful comparison between periods. Any analysis of non-GAAP financial measures should be done only in conjunction with results presented in accordance with GAAP. These non-GAAP financial measures are not intended to be a substitute for GAAP financial measures and should not be used as such. See also "Non-GAAP Financial Measures" in this press release.
(2) Lamb Weston holds equity interests in three potato processing joint ventures, including 50% of Lamb-Weston/Meijer, Lamb-Weston/RDO Frozen, and Lamb Weston Alimentos Modernos S.A., which it accounts for its ownership under the equity method of accounting. See Note 4, Investments in Joint Ventures, of the Notes to Consolidated Financial Statements in "Part II, Item 8. Financial Statements and Supplementary Data" in the Company's fiscal 2021 Form 10-K, for more information.
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Lamb Weston Holdings Inc. published this content on 26 July 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 27 July 2021 12:59:05 UTC.
Lamb Weston Holdings, Inc. is a supplier of frozen potato, sweet potato, appetizer and vegetable products to restaurants and retailers around the world. The Companyâs segments include Global, Foodservice, Retail, and Other. The Global segment includes frozen potato products sold in North America and international markets generally to the North American based restaurant chains and international customers comprised of global and regional quick service and full-service restaurant chains, foodservice distributors, and retailers. The Foodservice segment includes frozen potato products sold throughout the United States and Canada to commercial distributors, restaurant chains generally outside the North American based restaurant chains, and non-commercial channels. The Retail segment includes consumer-facing frozen potato products sold primarily to grocery, mass merchants, club, and specialty retailers. The Other reporting segment primarily includes its vegetable and dairy businesses.