Landec (LNDC) Tops Q3 EPS by 1c

Landec (NASDAQ: LNDC) reported Q3 EPS of $0.13, $0.01 better than the analyst estimate of $0.12. Revenue for the quarter came in at $136.6 million versus the consensus estimate of $135.86 million.

Management Comments and Guidance for Fiscal 2017

“We have been very active since our last earnings release three months ago with efforts to continue to position Landec as a true innovator in the health and wellness space,” stated Ms. Hemmeter. “We announced the Eat Smart 100% Clean Label Initiative, we acquired O Olive Oil, Inc., we extended our agreement with Windset for five more years, we named Debbie Carosella to our board of directors and we agreed to settle several labor related legal actions that have been going on for over 18 months, thus avoiding the unknown outcome of trials and potentially spending millions of dollars on future legal fees for litigation.”

Mr. Skinner added, “As announced last week, we now expect our EPS for our fiscal fourth quarter to range from $0.09 to $0.11 which results in a revised annual EPS range of $0.38 to $0.40. The reduction in our original annual net income guidance is driven by the legal settlement charge recorded during our fiscal third quarter plus the impact that the heavy rains in California since the beginning of January are expected to have on our fiscal fourth quarter results. The rains have damaged crops and have impeded our ability to plant fields during January and February which will result in shortages of key vegetable crops during our fiscal fourth quarter. In addition, we now expect revenues for fiscal 2017 to be flat compared to fiscal 2016 and we expect consolidated cash flow from operations of approximately $30 to $35 million and capital expenditures of approximately $20 to $25 million for fiscal 2017.

“Our balance sheet and cash generation remain strong. We ended the third quarter with $12.7 million in cash which was up $2.8 million from fiscal year end 2016. Debt at the end of the third quarter was $52.2 million with a debt to equity ratio of 23%, compared to $61.1 million and 29%, respectively, at fiscal year end 2016. Working capital strengthened to $39.4 million, up 31% compared to $30 million at fiscal year end 2016. Cash flow from operations for the first nine months was $23.2 million, up from $6.4 million for the same period last year. Capital expenditures for the first nine months were $9.5 million, down from $26.2 million for the same period last year. The net effect resulted in free cash flow of $13.7 million for the first nine months compared to a negative free cash flow of $19.8 million for the same period last year, an improvement of $33.5 million,” concluded Mr. Skinner.

For earnings history and earnings-related data on Landec (LNDC) click here.

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