Ralcorp Holdings: Net sales up 48 percent in Q2/2009

St. Louis / MO. (rh) Ralcorp Holdings Inc. filed its Quarterly Report for the period ended March 31, 2009. Reported diluted earnings per share (EPS) were 1,23 USD for the quarter and 2,38 USD for the six months ended March 31, 2009 compared to 1,46 USD and 3,08 USD for the corresponding periods last year, including the effects of certain special items related to Ralcorp´s investment in Vail Resorts Inc. and the Post Foods acquisition as follows:

	Q2/2009	Q2/2008	H1/2009	H1/2008
Gain on forward sale contracts	0,22 USD	0,60 USD	0,47 USD	1,53 USD
Gain on sale of securities	–	–	0,18 USD	–
Post Foods transition and integration costs	(0,09 USD)	–	(0,17 USD)	–

Second quarter diluted EPS excluding the above special items were 1,10 USD compared to 0,86 USD last year, a 28 percent increase. Total segment profit contribution grew 36 percent excluding the incremental amounts from Post Foods, and Post Foods´ sales and operating profit also exceeded expectations. The transition and integration of the Post Foods business into Ralcorp is proceeding as planned, and on April 27, 2009, Ralcorp transferred Post Foods to stand-alone information systems and commenced Post Foods´ independent sales, logistics, and purchasing functions. As a result of the exceptional base business improvement, the Post Foods acquisition (completed in August 2008) was dilutive to EPS for the quarter. Other reported results for the quarter ended March 31, 2009 included:

• Net sales increased 48 percent, primarily as a result of the Post Foods acquisition, as well as higher pricing in response to rising input costs.
• Total segment profit contribution was up 162 percent, primarily due to Post Foods and improved selling prices, partially offset by higher raw material costs.
• Earnings before income taxes and equity earnings were 98,5 million USD (compared to 49,2 million USD a year ago) including the non-cash gains on Vail forward sale contracts and Post transition and integration costs.
• Equity in earnings of Vail Resorts Inc. (after tax) was 7,0 million USD (0,12 USD per share) compared to 6,7 million USD (0,26 USD per share) a year ago.
• Net earnings were 70,2 million USD compared to 38,5 million USD last year.
• Weighted average shares for diluted EPS rose to 56,9 million USD from 26,2 million USD a year ago, primarily as a result of the 30,5 million USD shares issued in the Post Foods acquisition.
• Food EBITDA was 139,3 million USD compared to 57,8 million USD last year, largely due to incremental EBITDA from Post Foods partially offset by transition and integration costs related to Post Foods.
• Due to a recall of products containing peanut paste traced to Peanut Corporation of America, Ralcorp recorded approximately 3,4 million USD of costs and experienced short-term softness in consumer demand for items related to peanut butter.

Approximately 279,4 million USD of the second quarter´s 304,9 million USD sales growth came from Post Foods (included in the Cereals segment). Excluding Post Foods, second quarter sales volume changes were mixed, with an increase in Cereals (four percent) and declines in Frozen Bakery Products (14 percent), Snacks (twelve percent), and Sauces and Spreads (five percent). Sales US-ollars were up in all segments as Ralcorp raised selling prices in a number of its product categories in an effort to cover dramatically higher input costs.

Amortization of intangible assets other than software (mainly related to brands and customers) increased primarily as a result of the addition of amounts for Post Foods. Total amortization of such intangibles was 8,7 million USD (0,10 USD per share) for the second quarter of fiscal 2009 and 5,0 million USD (0,12 USD per share) for the second quarter of fiscal 2008.

Info: «Ralcorp Holdings Announces Results for the Second Quarter of Fiscal 2009» – complete press release (HTML).