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Premium Brands Holdings Corporation Announces Record 2012 Third Quarter Revenue and Adjusted EBITDA

Thursday, November 08, 2012

Premium Brands Holdings Corporation Announces Record 2012 Third Quarter Revenue and Adjusted EBITDA07:00 EST Thursday, November 08, 2012VANCOUVER, BRITISH COLUMBIA--(Marketwire - Nov. 8, 2012) - Premium Brands Holdings Corporation (TSX:PBH), a leading producer, marketer and distributor of branded specialty food products, announced today its results for the third quarter of 2012.HIGHLIGHTS FOR THE QUARTERRevenue for the quarter increased by 23.9% or $49.2 million to a record $255.0 million as compared to $205.7 million in the third quarter of 2011.Record Adjusted EBITDA for the quarter of $20.2 million representing a 14.4% increase as compared to $17.6 million in the third quarter of 2011.A quarterly dividend of $6.2 million or $0.294 per share.Rolling twelve months free cash flow of $45.9 million resulting in a dividend to free cash flow ratio of 52.7%.Adjusted EBITDA guidance for 2012 of $70 million to $75 million maintained.Implementation of a normal course issuer bid through the facilities of the TSX for the purchase and cancellation of up to 5% of its issued and outstanding common shares and up to 10% of each of its issued and outstanding convertible debentures. SUMMARY FINANCIAL INFORMATION(In thousands of dollars except per share amounts)13 Weeks Ended39 Weeks EndedSep 29,Sep 24,Sep 29,Sep 24,2012201120122011Revenue254,978205,748724,726543,695Adjusted EBITDA20,16517,63253,24540,564Earnings4,5996,09712,77311,574EPS0.220.320.620.62Rolling Four Quarters EndedSep 29,Dec 31,20122011Free cash flow45,85238,225Declared dividends24,15122,672Declared dividend per share1.1761.176Payout ratio52.7%59.3%"We are pleased to report another quarter of record revenues and Adjusted EBITDA," said Mr. George Paleologou, President and CEO. "Overall, our businesses continue to see strong growth opportunities through a combination of product innovation, geographical expansion and entering new market segments."There is, however, no question that our results for the quarter do not show our full potential. Over the last year we have been investing heavily in the capital improvements, infrastructure and process changes needed to support our growth objectives for the next five years. While these projects will create value for our shareholders over the long term, in the short term they are having a negative impact on our results."Looking forward, we are now in the final phase of many of these initiatives and, correspondingly, we will start to see the benefits associated with them in the near future," added Mr. Paleologou.About Premium BrandsPremium Brands owns a broad range of leading specialty food manufacturing and differentiated food distribution businesses with operations in British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, Quebec, Nevada and Washington State. The Company services over 26,000 customers and its family of brands and businesses include Grimm's, Harvest, McSweeney's, Bread Garden Go, Hygaard, Hempler's, Quality Fast Foods, Gloria's Best of Fresh, Direct Plus, National Direct-to-Store Distribution (NDSD), Harlan Fairbanks, Creekside Bakehouse, Centennial Foodservice, B&C Foods, Shahir, Duso's, Maximum Seafood, SK Food Group, OvenPride, Hub City Fisheries, Audrey's, Deli Chef and Piller's.RESULTS OF OPERATIONSRevenue(in thousands of dollars except percentages)13 weeks13 weeks39 weeks39 weeksendedendedendedendedSep 29,Sep 24,Sep 29,Sep 24,2012% 2011% 2012% 2011 %Revenue by segment:Retail158,47462.2%113,38555.1%445,60961.5%284,38752.3%Foodservice96,50437.8%92,36344.9%279,11738.5%259,30847.7%Consolidated254,978100.0%205,748100.0%724,726100.0%543,695100.0%Retail's revenue for the third quarter of 2012 as compared to the third quarter of 2011 increased by $45.1 million or 39.8% due to: (i) the acquisition of Piller's in 2011 which resulted in $37.2 million in incremental sales; and (ii) organic growth of $7.9 million representing an organic growth rate of approximately 7.0%.Retail's organic growth for the quarter, which was within the Company's targeted range of 6% to 8%, was due to a range of factors including: (i) a variety of new product and customer sales initiatives; (ii) price increases across a broad range of products; and (iii) favourable weather conditions in most of Retail's markets across Canada. These factors were partially offset by lower sales resulting from the restructuring of the Company's NDSD business' distribution network. This initiative involves the conversion of NDSD's customers in certain defined territories from being serviced by NDSD's direct-to- store delivery trucks to being serviced by exclusive third party distributors that form part of NDSD's distribution network. Hence, for territories that have been converted, the Company now sells its products at a discounted price (which results in a decrease in Retail's revenue) to an exclusive third party distributor who in turn sells and distributes the Company's products to convenience store retailers.Retail's revenue for the first three quarters of 2012 increased by $161.2 million or 56.7% as compared to the first three quarters of 2011 primarily due to: (i) the acquisitions of Piller's, SJ and Deli Chef in 2011, which resulted in incremental sales of $136.0 million; and (ii) organic growth across a range of products and customers of $25.2 million representing an organic growth rate of approximately 8.9%.Looking forward (see Forward Looking Statements), for the fourth quarter of 2012 the Company expects Retail's organic sales growth to continue to be within the range of its previous guidance of 6% to 8%.Foodservice's revenue for the third quarter of 2012 as compared to the third quarter of 2011 increased by $4.1 million or 4.5% due to: (i) general organic growth of $3.4 million representing an organic growth rate of 3.9%; and (ii) increased sales in its Worldsource food brokerage business of $0.7 million resulting from improved trading opportunities.Foodservice's low organic growth rate as compared to the Company's guidance of 6% to 8% was primarily due to lower seafood sales resulting from exceptionally warm weather that negatively impacted both consumer demand for seafood products and seafood harvesting. Foodservice's sales to its core hotel, restaurant and institutional customers grew at an organic rate of approximately 5.8% which was slightly below the Company's targeted range.Foodservice's revenue for the first three quarters of 2012 as compared to the first three quarters of 2011 increased by $19.8 million or 7.6% due to: (i) general organic growth of $15.2 million representing a growth rate of 6.2%; (ii) increased sales in its Worldsource food brokerage business of $3.5 million; and (iii) $1.1 million in unusual trading volume in its Hub City Fisheries business resulting from the sale of excess inventory relating to a very successful salmon fishery in 2011.Looking forward (see Forward Looking Statements), for the fourth quarter of 2012 the Company expects Foodservice's organic sales growth to be below its previous guidance of 6% to 8% primarily due to: (i) the negative impact on its sales to restaurants and pubs resulting from a delay in the start of the 2012/13 National Hockey League season; and (ii) product supply issues resulting from the shutdown at the end of the third quarter of one of Canada's largest beef processors due to a major product recall.Gross Profit(in thousands of dollars except percentages)13 weeks13 weeks39 weeks39 weeksendedendedendedendedSep 29,Sep 24,Sep 29,Sep 24,2012 %2011 %2012 %2011 %Gross profit by segment:Retail36,20522.8%30,36426.8%101,06222.7%75,98826.7%Foodservice18,25518.9%18,00619.5%52,94119.0%49,89919.2%Consolidated54,46021.4%48,37023.5%154,00321.2%125,88723.2%Retail's gross profit as a percentage of its revenue (gross margin) for the third quarter of 2012 as compared to the third quarter of 2011 decreased from 26.8% to 22.8% due in part to: (i) the acquisition of Piller's in 2011 as this business generally has lower average gross margins as compared to Retail's other businesses; and (ii) a change in selling terms whereby certain customers now receive their products FOB the Company's plant versus FOB the customers' warehouses. This resulted in the elimination of freight being billed to these customers and corresponding decreases in gross profit and selling expenses.Normalizing for the above factors, Retail's gross margin for the quarter was 25.7% as compared to 27.0% in the third quarter of 2011. The balance of the decrease in Retail's gross margin was primarily due to: (i) reduced gross margins on product sales transitioned to third party distributors as part of the restructuring of NDSD's distribution network; and (ii) increased plant overheads associated with Retail's new bakery facility, which was completed in the third quarter.Retail's gross margin for the first three quarters of 2012 as compared to the first three quarters of 2011 decreased from 26.7% to 22.7% due in part to: (i) the acquisitions of Piller's and SJ in 2011; and (ii) the change in selling terms for certain customers as discussed above. Normalizing for these factors, Retail's gross margin for the first three quarters of 2012 was 26.4% as compared to 27.1% for the first three quarters of 2011. The balance of the decrease in Retail's gross margin was primarily due to the restructuring of NDSD's distribution network and increased bakery plant overheads as discussed above.Foodservice's gross margin for the third quarter of 2012 as compared to the third quarter of 2011 decreased from 19.5% to 18.9% due to a variety of commodity input cost increases including: (i) higher premium beef prices, which were the result of increased buying and promotion of premium beef by a large U.S. based retailer; (ii) higher seafood costs, which were the result of a poor harvest of several species of seafood; and (iii) increased popcorn kernel prices, which were due to relatively poor crops in 2011 and 2012.Foodservice's gross margin for the first three quarters of 2012 was relatively consistent with its gross margin for the first three quarters of 2011.Selling, General and Administrative Expenses (SG&A)(in thousands of dollars except percentages)13 weeks13 weeks39 weeks39 weeksendedendedendedendedSep 29,Sep 24,Sep 29,Sep 24,2012%2011%2012%2011%SG&A by segment:Retail20,67313.0%17,70015.6%59,69913.4%46,79616.5%Foodservice12,31512.8%11,55012.5%36,48313.1%33,94613.1%Corporate1,3071,4884,5764,581Consolidated34,29513.5%30,73814.9%100,75813.9%85,32315.7%Retail's SG&A in the third quarter of 2012 as compared to the third quarter of 2011 increased by $3.0 million primarily due to: (i) the acquisition of Piller's in 2011 which resulted in an increase of $2.9 million; and (ii) a variety of items consisting primarily of variable selling costs associated with Retail's organic sales growth. These increases were partially offset by: (i) a decrease in freight costs of approximately $0.9 million due to a change in selling terms whereby certain customers now receive their products FOB the Company's plant versus FOB the customers' warehouses. This resulted in the elimination of freight being billed to these customers and corresponding decreases in gross profit and selling expenses; and (ii) reduced distribution related costs resulting from the rationalization of Retail's DSD Network.Retail's SG&A for the first three quarters of 2012 as compared to the first three quarters of 2011 increased by $12.9 million primarily due to: (i) the acquisitions of Piller's, SJ and Deli Chef in 2011 which resulted in an increase in Retail's SG&A of $13.5 million; and (ii) a variety of items consisting primarily of variable selling costs associated with Retail's organic sales growth. These increases were partially offset by: (i) a decrease in freight costs of approximately $2.5 million due to the change in selling terms whereby certain customers now receive their products FOB the Company's plant versus FOB the customers' warehouses; and (ii) reduced distribution related costs resulting from the rationalization of Retail's DSD Network.Normalizing for the acquisitions of Piller's and SJ and for the impact of the change in selling terms for certain customers, Retail's SG&A as a percentage of revenue for the first three quarters of 2012 was 16.2% as compared to 16.5% for the first three quarters of 2011. The decrease in Retail's normalized SG&A as a percentage of revenue was due to a range of factors including reduced distribution related costs resulting from the rationalization of its DSD Network.Foodservice's SG&A in the third quarter of 2012 as compared to the third quarter of 2011 increased by $0.8 million while its SG&A in the first three quarters of 2012 as compared to the first three quarters of 2011 increased by $2.5 million. Both increases were due to a variety of items including higher variable selling costs associated with Foodservice's organic sales growth.Foodservice's SG&A as a percentage of revenue for the first three quarters of 2012 was 13.1%, which is consistent with its SG&A as a percentage of revenue of 13.1% for the first three quarters of 2011.Adjusted EBITDA(in thousands of dollars except percentages)13 weeks13 weeks39 weeks39 weeksendedendedendedendedSep 29,Sep 24,Sep 29,Sep 24,2012%2011%2012%2011%Adjusted EBITDA by segment:Retail15,5329.8%12,66311.2%41,3639.3%29,19210.3%Foodservice5,9406.2%6,4577.0%16,4585.9%15,9536.2%Corporate(1,307)(1,488)(4,576)(4,581)Consolidated20,1657.9%17,6328.6%53,2457.3%40,5647.5%The Company's Adjusted EBITDA for the first three quarters of 2012 as compared to the first three quarters of 2011 increased by $12.7 million or 31.3% to $53.2 million primarily due to: (i) acquisitions; and (ii) organic growth in a number of the Company's legacy businesses. These increases were partially offset by:A decrease in the Company's Stuyver's business' Adjusted EBITDA in the third quarter of 2012 as compared to the third quarter of 2011 due to a combination of: (i) a planned increase in Stuyver's production overheads resulting from the incremental capacity of its new artisan bakery; and (ii) Stuyver's delay of a variety of selling initiatives (which are based on leveraging its incremental capacity) due to startup related issues at its new artisan bakery. The Company expects (see Forward Looking Statements) Stuyver's startup related issues to be resolved in the fourth quarter of 2012 after which Stuyver's will begin aggressively pursuing its new selling initiatives.A decrease in the Company's NDSD business' Adjusted EBITDA in the third quarter of 2012 as compared to the third quarter of 2011 due to delays in fully implementing the SG&A savings associated with the restructuring of its distribution network. As a result, the Company lost the margin associated with sales that were transitioned to exclusive third party distributors but did not fully realize the cost savings projected to result from these changes. The Company expects (see Forward Looking Statements) NDSD to have all of the cost savings initiatives associated with its restructuring implemented by the end of the first quarter of 2013. Looking forward (see Forward Looking Statements), despite the impact of the decrease in Stuyver's and NDSD's Adjusted EBITDA, as discussed above, the Company still expects its Adjusted EBITDA for 2012 to be within its current guidance of $70.0 million to $75.0 million, albeit likely at the bottom end of this range.InterestThe increase in the Company's interest and other financing costs for both the third quarter of 2012 as compared to the third quarter of 2011, and for the first three quarters of 2012 as compared to the first three quarters of 2011, was primarily due to: (i) an increase in the Company's average outstanding net funded debt; and (ii) the issuance of $57.5 million of convertible debentures, the proceeds of which were used to repay lower cost senior debt.Restructuring CostsRestructuring costs consist of costs associated with the significant restructuring of one or more of the Company's businesses. For the first three quarters of 2012, the Company incurred $4.0 million in restructuring costs consisting of:$2.2 million in costs relating to the reconfiguration of the Company's sandwich production facilities. This project consists of the following three initiatives: (i) the construction of a new 20,000 square foot sandwich plant in Laval, Quebec, which was completed at the end of the second quarter of 2012 and commenced operations in July 2012; (ii) the transfer of the operations of the Company's leased sandwich production facility in Edmonton, Alberta to its owned sandwich production facility in Edmonton and the subsequent shutdown of the leased facility. This was completed in August 2012; and (iii) the transfer of the production of certain products from the Company's sandwich plant in Etobicoke, Ontario to its new plant in Laval and the subsequent sale of the Etobicoke plant's remaining operations, which consisted primarily of fresh sandwich production. This was completed at the end of September 2012. Once completed, the benefits expected (see Forward Looking Statements) to be generated from this project include: (i) a new state-of-the-art facility in Laval which will be used to grow the Company's sandwich business in central and eastern Canada; (ii) reduced plant operating overhead costs through the shutdown of the Company's leased facility in Edmonton; (iii) improved production efficiencies by transferring production from the less efficient Etobicoke plant to the new Laval plant; and (iv) freight savings associated with reconfiguring production so that sandwiches for the central and eastern Canadian markets are made in the Laval facility while sandwiches for the western Canadian market are produced in the Edmonton facility. Looking forward (see Forward Looking Statements), the Company anticipates that it will incur an additional $0.4 million in restructuring costs associated with this initiative in the fourth quarter of 2012.$0.9 million in charges relating to the restructuring of the Company's NDSD business' direct-to- store distribution networks (DSD networks) for the convenience store channel. This restructuring, which is expected to be completed in the first quarter of 2013, involves the merging and rationalization of the following three DSD networks:The Company's Direct Plus DSD network, which operates primarily in western Canada;The DSD network acquired as part of the Deli Chef acquisition in 2011. This network operates in Ontario and Quebec; andThe independent distributor network controlled by the Company's recently acquired Pridcorp business. This network operates in various markets across Canada, including the Maritimes.Once completed, this initiative is expected to (see Forward Looking Statements): (i) create Canada's only national convenience store DSD network in the sandwich, meat snack and pastry categories; (ii) gain efficiencies by eliminating overlaps where two of the above three DSD networks are servicing the same customer sites; and (iii) further improve the profitability of the DSD delivery routes serviced by the Company's own fleet by adding products to these routes that were previously distributed exclusively by Pridcorp's network. Looking forward (see Forward Looking Statements), the Company anticipates that it will incur an additional $0.4 million in restructuring costs relating to this initiative over the next two quarters.$0.9 million in startup, redundant lease and severance costs associated with Stuyver's new artisan bread facility, which commenced commercial operations in the second quarter of 2012. This initiative is expected to (see Forward Looking Statements): (i) provide a substantial increase in production capacity as Stuyver's previous bakery, which was shut down in July 2012 and was operating at near to capacity; and (ii) generate significant production efficiencies once the plant is operating at a reasonable level of utilization of its capacity. Looking forward (see Forward Looking Statements), the Company anticipates that it will incur an additional $0.2 million in restructuring costs relating to this initiative in the fourth quarter of 2012. FREE CASH FLOWThe following table provides a reconciliation of free cash flow to cash flow from operating activities:(in thousands of dollars)53 weeks39 weeks39 weeksRollingendedendedendedFourDec 31, 2011Sep 24, 2011Sep 29, 2012QuartersCash flow from operating activities29,52417,01440,21652,726Changes in non-cash working capital6,0509,592(4,695)(8,237)Deferred revenue1,1181,118--Acquisition transaction costs1,594892193895Restructuring costs2,8192,7453,9914,065Capital maintenance expenditures(2,880)(1,905)(2,622)(3,597)Free cash flow38,22529,45637,08345,852FORWARD LOOKING STATEMENTSThis discussion and analysis contains forward looking statements with respect to the Company, including its business operations, strategy and financial performance and condition. These statements generally can be identified by the use of forward looking words such as "may", "could", "should", "would", "will", "expect", "intend", "plan", "estimate", "project", "anticipate", "believe" or "continue", or the negative thereof or similar variations.Although management believes that the expectations reflected in such forward looking statements are reasonable and represent the Company's internal expectations and belief as of November 7, 2012, such statements involve unknown risks and uncertainties beyond the Company's control which may cause its actual performance and results in future periods to differ materially from any estimates or projections of future performance or results expressed or implied by such forward looking statements.Factors that could cause actual results to differ materially from the Company's expectations include, among other things: (i) seasonal and/or weather related fluctuations in the Company's sales; (ii) changes in consumer discretionary spending resulting from changes in economic conditions and/or general consumer confidence levels; (iii) changes in the cost of raw materials used in the production of the Company's products; (iv) changes in the cost of products sourced from third party manufacturers and sold through the Company's proprietary distribution networks; (v) risks associated with the Company's conversion from a publicly traded income trust to a publicly traded corporation, including related changes in Canada's income tax laws; (vi) changes in the Company's relationships with its larger customers; (vii) potential liabilities and expenses resulting from defects in the Company's products; (viii) changes in consumer food product preferences; (ix) competition from other food manufacturers and distributors; (x) execution risk associated with the Company's growth initiatives; (xi) risks associated with the Company's business acquisition strategies; and (xii) new government regulations affecting the Company's business and operations. Details on these risk factors as well as other factors can be found in the Company's 2011 MD&A, which is filed electronically through SEDAR and is available online at www.sedar.com.Unless otherwise indicated, the forward looking information in this document is made as of November 7, 2012 and, except as required by applicable law, will not be publicly updated or revised. This cautionary statement expressly qualifies the forward looking information in this document.Premium Brands Holdings CorporationConsolidated Balance Sheets(Unaudited and in thousands of dollars)September 29,December 31,September 24,201220112011Current assets:Cash and cash equivalents3,8954,8604,290Accounts receivable83,66978,83079,370Other assets162103677Inventories88,68579,97787,415Prepaid expenses5,58813,45511,181181,999177,225182,933Capital assets182,204167,982157,919Intangible assets73,00177,08771,897Goodwill154,391150,417151,854Other assets2,1912,2501,264Deferred income taxes31,92339,95241,729625,709614,913607,596Current liabilities:Cheques outstanding1,9412,5043,438Bank indebtedness1,37018,0619,490Dividend payable6,1875,9585,958Accounts payable and accrued liabilities91,78480,16282,233Current portion of long-term debt23,59620,53617,516Current portion of provisions2,3492,924-Other300--127,527130,145118,635Puttable interest in subsidiaries15,28215,21015,285Deferred revenue1,5441,9432,032Pension obligation1,3491,3451,008Provisions9,4898,3608,151Long-term debt127,808162,661162,209Convertible unsecured subordinated debentures133,75189,39689,030Other-100-416,750409,160396,350Equity attributable to shareholders:Accumulated earnings145,981133,370132,591Accumulated dividends declared(148,690)(130,497)(124,525)Retained earnings (deficit)(2,709)2,8738,066Share capital209,068198,057198,057Equity component of convertible unsecured subordinated debentures1,8691,9161,916Reserves(796)1,4421,803Non-controlling interest1,5271,4651,404208,959205,753211,246625,709614,913607,596Premium Brands Holdings CorporationConsolidated Statements of Operations(Unaudited and in thousands of dollars except per share amounts)13 weeks13 weeks39 weeks39 weeksendedendedendedendedSeptember 29,September 24,September 29,September 24,2012201120122011Revenue254,978205,748724,726543,695Cost of goods sold200,518157,378570,723417,808Gross profit before depreciation and amortization54,46048,370154,003125,887Selling, general and administrative expenses before depreciation and amortization34,29530,738100,75885,32320,16517,63253,24540,564Depreciation of capital assets4,0883,14811,4838,175Amortization of intangible assets1,2148173,7012,372Amortization of other assets1144Interest and other financing costs4,6763,65313,10010,302Amortization of financing costs9455306193Acquisition transaction costs140490193892Change in value of puttable interest in subsidiaries5004901,2051,678Accretion of provisions2103562935Unrealized loss (gain) on foreign currency contracts200(796)300(715)Unrealized gain on interest rate swap contracts(100)-(200)-Restructuring costs2,3319003,9912,745Acquisition bargain purchase gain---(1,355)Equity loss in associate---277Earnings before income taxes6,8118,83918,53315,961Provision for income taxesCurrent1,1093862,0511,405Deferred1,1032,3563,7092,9822,2122,7425,7604,387Earnings4,5996,09712,77311,574Earnings for the period attributable to:Shareholders4,4926,01212,61111,339Non-controlling interest107851622354,5996,09712,77311,574Earnings per shareBasic0.220.320.620.62Diluted0.210.320.610.62Weighted average shares outstanding (in 000's)Basic20,82218,55520,45818,284Diluted20,91718,65120,55318,380Premium Brands Holdings CorporationConsolidated Statements of Cash Flows(Unaudited and in thousands of dollars)13 weeks13 weeks39 weeks39 weeksendedendedendedendedSeptember 29,September 24,September 29,September 24,2012201120122011Cash flows from operating activities:Earnings4,5996,09712,77311,574Items not involving cash:Depreciation of capital assets4,0883,14811,4838,175Amortization of intangible and other assets1,2158183,7052,376Amortization of financing costs9455306193Change in value of puttable interest in subsidiaries5004901,2051,678Loss (gain) on disposal of capital assets2281244(1)Accrued interest income(7)(17)(22)(43)Net unrealized loss (gain) on foreign currency and interest rate swap contracts100(796)100(715)Equity loss in associate---277Deferred revenue(142)(109)(387)(216)Accretion of convertible debentures4943291,2721,056Accretion of long-term debt212201504590Accretion of provisions2103562935Acquisition bargain purchase gain---(1,355)Deferred income taxes1,1032,3563,7092,98212,69412,60835,52126,606Change in non-cash working capital7,9372,7114,695(9,592)20,63115,31940,21617,014Cash flows from financing activities:Long-term debt - net(922)60,178(32,164)29,740Bank indebtedness and cheques outstanding(9,602)(4,118)(17,254)4,431Convertible debentures - net of issuance costs--54,60054,600Deferred revenue---1,118Purchase of 7.00% Debentures under normal course issuer bid(261)-(261)-Dividends paid to shareholders(6,005)(5,380)(17,964)(16,124)Other--(2)(381)(16,790)50,680(13,045)73,384Cash flows from investing activities:Capital asset additions(3,115)(2,896)(26,798)(9,198)Business acquisitions-(63,846)-(74,681)Repayment of share purchase loans and notes receivable262121063Promissory note from associate---(300)Net proceeds from sales of assets-1428519Payments to shareholders of non-wholly owned subsidiaries(74)(83)(1,227)(445)Purchase of shares of non-wholly owned subsidiary pursuant to puttable interest---(2,286)Payment of provisions for contingent consideration(356)-(575)-Other(8)141-(168)(3,527)(66,649)(28,105)(86,996)Increase (decrease) in cash and cash equivalents314(650)(934)3,402Effects of exchange on cash and cash equivalents45(22)(31)20Cash and cash equivalents - beginning of period3,5364,9624,860868Cash and cash equivalents - end of period3,8954,2903,8954,290FOR FURTHER INFORMATION PLEASE CONTACT: Contact Information: Premium Brands Holdings CorporationGeorge PaleologouPresident and CEO(604) 656-3100Premium Brands Holdings CorporationWill KalutyczCFO(604) 656-3100