Hostess Brands, Inc. Acquires Breakfast Brands and Expands Product Range |
Reiterates Full Year 2017 Financial Outlook
“This is an excellent enabling acquisition for the Hostess breakfast
strategy and fills a key strategic gap in our product portfolio,” said
Highlights of the transaction include the following:
“This strategic acquisition allows us to bring important product manufacturing in-house as we expand and drive growth in our breakfast product portfolio,” commented Bill Toler, President and Chief Executive Officer of Hostess. “In addition, this purchase will enable Hostess to forgo in-house capital investments and create significant value over the next few years.”
“We have had a long supply relationship with
The acquired assets include inventory, property, plant, equipment and
customer relationships serviced by the Chicago Cloverhill bakery
facility. The Company expects short-term EBITDA losses of approximately
The Company believes this acquisition is an efficient use of cash and continues to have the financial flexibility to consider potential future uses of cash including funding acquisitions, optional debt repayments or opportunistically simplifying its equity structure. Additionally, Hostess expects to immediately depreciate a substantial portion of the purchase price for tax purposes. Full Year 2017 Outlook
Today, the Company also confirmed its full year 2017 financial outlook,
prior to giving effect to the favorable impact of recently enacted
federal tax reform, previously provided on The Company believes that it is well positioned to grow and enhance shareholder value through the execution of its strategic initiatives. These key strategic initiatives are focused on further core distribution expansion, continued new product initiatives and line extensions, the pursuit of white space opportunities and serving as a platform for future acquisitions.
About
The Company is one of the leading packaged food companies focused on
developing, manufacturing, marketing, selling and distributing fresh
sweet baked goods in
For more information about Hostess products and Forward-Looking Statements This press release contains statements reflecting the Company's views about its future performance that constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended, that involve substantial risks and uncertainties. Forward-looking statements are generally identified through the inclusion of words such as “believes,” “expects,” “intends,” “estimates,” “projects,” “anticipates,” “will,” “plan,” “may,” “should,” or similar language. Statements addressing the Company's future operating performance and statements addressing events and developments that the Company expects or anticipate will occur are also considered as forward-looking statements. All forward-looking statements included herein are made only as of the date hereof. The Company undertakes no obligation to update any forward-looking statement, whether as a result of new information, future events, or otherwise.
These statements inherently involve risks and uncertainties that could
cause actual results to differ materially from those anticipated in such
forward-looking statements. These risks and uncertainties include, but
are not limited to, maintaining, extending and expanding the Company's
reputation and brand image; protecting intellectual property rights;
leveraging the Company's brand value to compete against lower-priced
alternative brands; correctly predicting, identifying and interpreting
changes in consumer preferences and demand and offering new products to
meet those changes; operating in a highly competitive industry; the
continued ability to produce and successfully market products with
extended shelf life; the ability to drive revenue growth in key products
or add products that are faster-growing and more profitable; volatility
in commodity, energy, and other input prices; dependence on major
customers; geographic focus could make the Company particularly
vulnerable to economic and other events and trends in
As a result of a number of known and unknown risks and uncertainties,
the Company's actual results or performance may be materially different
from those expressed or implied by these forward-looking statements.
Risks and uncertainties are identified and discussed in Item 1A-Risk
Factors in the Company's Annual Report on Form 10-K and its subsequent
1 For the 52-week period ended View source version on businesswire.com: http://www.businesswire.com/news/home/20180201005660/en/ Source:
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