Specialty Foods Group Inc. announces termination of relationship with Nathan's Famous Inc.
HAMPTON, VA, Dec. 20, 2012, 2012 (Canada NewsWire via COMTEX) --
Specialty Foods Group, Inc. ("SFG or
the "Company") announced today that it has been notified by Nathan's
Famous, Inc. ("Nathan's) that Nathan's will not be renewing its license
agreement with SFG. The current agreement expires on March 1, 2014.
SFG has been, and will continue to, pursue new opportunities in order to
replace the portion of the business currently dedicated to Nathan's
branded products. However, absent SFG being able to replace the
Nathan's business (which currently represents approximately 45% of
SFG's annual revenues), the loss of the Nathan's license agreement
would have a material adverse effect on the Company which could include
significant costs associated with the restructuring of SFG's facilities
and personnel, the extent of which are currently unknown.
SFG is also continuing its efforts to collect on a court ordered
judgment requiring Nathan's to pay $4.9 million in damages, plus
interest, to SFG stemming from the improper pricing of certain spices
used in Nathan's products. That judgment has been appealed by Nathan's.
The results of such appeal are not yet known.
About the Company
The Company is an independent U.S. producer and marketer of premium
branded and private-label processed meat products. SFG sells a wide
variety of products such as franks, hams, bacon, luncheon meats, and
delicatessen meats. These products are sold to a diverse customer base
in the retail (e.g., supermarkets) and foodservice (e.g., restaurants)
sectors. SFG sells products under a number of leading national and
regional brands, such as Nathan's, Field, Fischer's, Mickelberry's,
Kentucky Legend and Scott Petersen as well as on a private-label basis.
This release contains, and remarks made by representatives of the
Company in connection with this release, may contain forward-looking
This news release contains certain forward-looking statements and information, which reflect the
current view of SFG with respect to future events and financial
performance. Forward-looking statements generally can be identified by
the use of forward-looking terminology such as "may", "will", "expect",
"intend", "anticipate", "plan", "foresee", "believe" or "continue" or
the negatives of such terms or variations of them or similar
terminology. Any such forward-looking statements are based on SFG's
current expectations, estimates, projections and assumptions made in
light of its experience and perception of historical trends.
Any such forward-looking statements are subject to risks and
uncertainties and SFG's actual results of operations could differ
materially from historical results or current expectations. The risks
that could cause actual results to differ from current expectations
include: stability in the U.S. economy; stability in prevailing
exchange rates; stability in the availability and pricing of raw
materials, energy and supplies; the ability to implement price
increases successfully; stability in the competitive environment; no
future product recalls; the continued ability of the Company to access
cost effective capital when needed; and no unexpected or unforeseen
events occurring that would materially alter the Company's current
plans. All of these assumptions have been derived from information
currently available to the Company including information obtained by
the Company from third-party sources. These assumptions may prove to be
incorrect in whole or in part. In addition, actual results may differ
materially from those expressed, implied or forecasted in such
forward-looking statements, which reflect the Company's expectations
only as of the date hereof.
Factors that could cause actual results or outcomes to differ materially
from the results expressed, implied or forecasted by the
forward-looking statements include risks associated with implementing
and executing complex projects and plans; risks posed by food
contamination, pandemics and product recalls; risks associated with the
price of commodities and the inability of the Company to control
commodity prices; risks associated with exchange rate fluctuations;
risks associated with changing consumer tastes, preferences and buying
patterns; and risks posed by competition.
Some of the forward-looking statements may be considered to be financial
outlooks for purposes of securities legislation including, but not
limited to, statements concerning future margins and capital
expenditures. These financial outlooks are presented in order to
provide measurable targets that the Company aims to achieve and for
which the Company can use to benchmark its results. These financial
outlooks may not be appropriate for other purposes and readers should
not assume they will be achieved.
The Company does not intend to, and the Company disclaims any obligation
to, update any forward-looking statements (including any financial
outlooks), whether written or oral, or whether as a result of new
information, future events or otherwise, except as required by law.
SOURCE: Specialty Foods Group Inc.
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SOURCE: Specialty Foods Group Inc.
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