Wednesday, August 20, 2014
Inquirer Daily News

Aramark's full-year sales up 2 percent

The Philadelphia services giant posted revenue increases in all of its business units.

Aramark's full-year sales up 2 percent

For a $12.6 billion company, Aramark Corp. sure is quiet about when it has a strong year.

But the Philadelphia food-service provider and uniform-rental company did increase sales for its fiscal year ended Oct. 1 by 2 percent. Not bad in a year when revenue growth has eluded most major companies.

Gimme Credit L.L.C. analyst Vicki Bryan wrote in a note that it was the first time in years revenue was up in all of Aramark’s business segments, even its uniform and career-apparel unit, which she described as “long-struggling.”

A privately held company since 2007, Aramark still files its financial results with the Securities and Exchange Commission because its junk bonds are still traded.

Aramark reported full-year net income of $30.7 million compared with a loss of $6.9 million the previous year. But you won’t hear any discussion of net income on its conference call with analysts.

Rather, what’s important is “adjusted operating income,” which weighed in at $637 million, flat with the previous year. Also, free cash flow of $370 million was well above the company’s internal plan, said chairman and chief executive officer Joseph L. Neubauer.

Aramark’s fourth-quarter results got a bump from providing support services for the security details attached to the Group of Eight and Group of Twenty diplomatic meetings in Toronto. But sales declined for its sports and entertainment sector, in part reflecting lower average attendance levels for Major League Baseball teams not named the Phillies.

“Today’s macroeconomic environment continues to be somewhat challenging, but we’ve seen a number of months now of stability in our most cyclical businesses,” Neubauer told analysts on the call.

You say tomato

B&G Foods Inc., of Parsippany, N.J., acquired the tomato-products business of Violet Packing L.L.C. last week.

Terms of the transaction were not announced, but B&G did say that Violet Packing would add net sales of $13 million to $15 million.

That’s a small fraction of annual sales for the publicly held B&G. In 2009, B&G reported net income of $17.4 million, or 71 cents per share, on net sales of $501 million.

Growth by acquisition is the strategy for B&G, which owns the Ortega brand of taco shells and other Mexican food products. It bought the Cream of Wheat and Cream of Rice brands from Kraft Foods Global Inc. for $200.5 million in 2007.

In picking up Violet Packing, B&G acquired a manufacturing plant in Williamstown, but not its DeIorio pizza-dough business in Utica, N.Y.

Violet Packing traces its roots to 1883 and a time when tomato farms sprawled across the New Jersey landscape. It had been family-owned until it was acquired in 2004 by the Chicago buyout firm LaSalle Capital Group L.P. for an undisclosed amount. Under LaSalle’s ownership, Violet Packing acquired DeIorio’s in 2007.

On Friday, B&G shares closed at $12.56, up 6 cents.

Mike Armstrong Inquirer Columnist
About this blog
Mike Armstrong blogs about Philadelphia corporations and business-related topics. Contact him at 215-854-2980. Reach Mike at marmstrong@phillynews.com.

Mike Armstrong Inquirer Columnist
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