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To: E_K_S who wrote (61756)	2/26/2019 10:38:09 AM
From: Wallace Rivers	Respond to of 78704

As I said previously, I am out of BGS. IMHO, and I've been wrong many times, technically the stock isn't looking favorable, and the heavy put buying is concerning. OTOH, the same dividend pay of the three Qs prior was announced this morning. I think the risk outweighs the potential rewards for BGS currently.

To: E_K_S who wrote (61756)	2/26/2019 7:52:26 PM
From: Elroy	Read Replies (2) \| Respond to of 78704

I breezed the press BGS release, I can't tell why it's bad news. 2019 revenues are expected to be $500m below 2018 levels, perhaps that is the divestiture of Pirate Booty brand, not sure. Regardless, the financials other than that look the same. 2019 EPS is expected to be a bit above 2018, and EBITDA about the same as 2018. That sounds fine to me..... For the first quarter of 2019, net sales are expected to be approximately $400.0 million to $412.0 million, adjusted EBITDA is expected to be approximately $78.0 million to $82.0 million and adjusted diluted earnings per share is expected to be approximately $0.47 to $0.52. Cash is down to $11 million (they must have some line of credit) while LT Debt is down to $1.64 billion. That sounds scary! They're going to need cash to refill inventory (which was depleted by $100m in 2018, thus producing cash), but I suppose $400m is their new normal, so perhaps incoming cash will be used to replace inventory. I guess the big question is when is their next chunk of LT debt due? If far in the future, then they can likely float along making money, paying a huge dividend, and doing the brand acquisition and revamp thing that they do. On the other hand, if $500m comes due in 18 months, they gotta figure out where to get that money. I don't know the line of credit story or debt maturity story well enough to say. The press release doesn't read like anything is wrong. I guess 2018 is well below 2017, and Q4 2018 EPS is only about 38 cents versus a 47 cents dividend, so maybe that's why the shares are down. But the outlook (basically, same as 2018 totals) seems OK. But I guess the story is that they expected 2018 to have higher profit levels, so being the same as 2018 is not cool, it's the new lower normal. Ok, got it. Maybe they keep up the div, maybe not, lets see....

To: E_K_S who wrote (61756)	2/27/2019 4:46:08 AM
From: Elroy	3 Recommendations Recommended By E_K_S Lance Bredvold Spekulatius Respond to of 78704

BGS call transcript is out..... We had a very strong year for cash generation, generating more than $200 million in net cash provided by operating activities for the year. We nailed our inventory reduction plan target, reducing inventory by more than 100 million during the year from approximately 502 million at the beginning of the year to approximately 401 million today. -- Hmmm, since they reduced inventory by $100m, $200m in cash generation is not that great. They should generate about $120m by just selling excess inventory, so.....normalized cash generation (if inventory had remained flat in 2018) would be only $80m. -- Our inability to hit the high end of our net sales target with volume gains, driven by our higher margin brands, further limited our ability to achieve our adjusted EBITDA targets for the quarter and contributed to our lower margin mix, costing us some $5 million in lost adjusted EBITDA opportunity. -- So they sold a lot of low margin food, and less high margin food. Bummer! -- We remain firmly committed to maintaining our dividend policy, and we remain well-positioned to opportunistically pursue M&A. Our board of directors reaffirmed its commitment to our dividend policy yesterday by declaring our 58th consecutive quarterly dividend since our IPO in 2004. -- , we repurchased and retired $8.4 million of common stock or 295,000 shares during the quarter at an average price per share of $28.39, bringing our total for the year to $26.9 million of common stock or approximately one million shares. -- For 2019, we expect net sales to be in the range of 1.635 to 1.665 or in line with our zero to 2% long-term topline growth model. So they are not even trying to grow! --- an effective tax rate of approximately 44.5% and cash taxes, excluding the tax effects from the gain on sale of Pirate Brands, to be less than 5 million. Hmmm, wonder how they have a 44% tax rate but only pay $5 million in actual taxes? -- Our sales price increases and the majority of our cost savings initiatives for 2019 will not be effective until after the end of the first quarter. ---- All in, we expect to benefit by approximately 15 to $20 million in pricing this year, which includes the 20 to $25 million of annualized price increase that will go into effect this spring. Our second core assumption to combat inflation in 2019 is cost savings. After a complete review of our cost structure in 2018, we only just began to implement the first initiatives of the program late in the year that yielded some 3 to $5 million in the fourth quarter. In 2019, we expect to drive another 15 to $20 million of cost savings, growing to 20 to $25 million in 2020, --