Heinz Net Income Rises For Fiscal Year

NEW YORK - May 28/09 - SNS -- H.J. Heinz and Company reported net income of U.S. $175.135 million on sales of $2,537.757 million during the fourth quarter ending April 29, compared to a net of $194.062 million on sales of $2,688.251 million during the same three month period last year.

This lifted net income for the full fiscal year to $923.072 million on sales of $10,148.082 million, compared to a net of $844.925 million on sales of $10,070.778 million the previous fiscal year.

In releasing its financial results, Heinz also said it will increase its annualized common stock dividend in Fiscal 2010 by 2 cents, to $1.68 from $1.66. Heinz has increased the dividend by 56% since adjusting it for the Del Monte spinoff in December 2002.

Sales grew on a constant currency basis by 7.4% in Fiscal 2009; however, reported sales were reduced by approximately $665 million due to unfavorable translation rates in international markets. In addition, the decline in restaurant traffic continued to impact the Company's U.S. Foodservice business. About 60% of Heinz's sales and the majority of the Company's profit in Fiscal 2009 were generated outside the U.S.

Reported Operating Income declined 4.8% to $1.49 billion due to the negative impact of currency translation (7.7%) and transaction currency cross rates costs in the UK (2.8%). On a constant currency basis, operating income increased 5.7%. Below operating income, Heinz was able to offset almost 90% of the translation currency impact on operating income through currency translation hedging contracts.

Fiscal 2009 also included a mark-to-market $20 million gain on the total return swap related to dealer remarketable securities, offsetting much of the additional cost of that debt in Fiscal 2009. Heinz also had a lower tax rate of 28.8%.

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