10q10k10q10k.net

What changed in B&G Foods, Inc.'s 10-K — 2023 vs 2024

vs

Paragraph-level year-over-year comparison of B&G Foods, Inc.'s 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+341 added−323 removedSource: 10-K (2024-02-28) vs 10-K (2023-02-28)

Top changes in B&G Foods, Inc.'s 2024 10-K

341 paragraphs added · 323 removed · 264 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

70 edited+20 added−14 removed67 unchanged
Biggest changeThe tables also set forth our five-year goals (established in January 2022) to increase the representation of women and members of underrepresented groups in both our general employee population and our leadership. ​ Female Talent as a Percentage of Employees ​ Fiscal Year Ended Goal ​ December 31, 2022 January 1, 2022 January 2, 2021 By 2027 All Employees 33% 34% 33% 50% Corporate 54% 53% 53% ​ Manufacturing, Warehouse and Distribution 28% 29% 29% ​ All Leadership Employees 28% 28% 27% 38% Corporate Leadership (1) 39% 34% 31% ​ Manufacturing, Warehouse and Distribution Leadership (2) 24% 26% 26% ​ ​ ​ - 12 - Table of Contents Underrepresented Talent (3) as a Percentage of Employees ​ ​ Fiscal Year Ended Goal ​ December 31, 2022 January 1, 2022 January 2, 2021 By 2027 All Employees 38% 32% 30% 35% Corporate 21% 21% 20% ​ Manufacturing, Warehouse and Distribution 42% 35% 32% ​ All Leadership Employees 25% 18% 17% 28% Corporate Leadership (1) 6% 10% 10% ​ Manufacturing, Warehouse and Distribution Leadership (2) 31% 21% 20% ​ (1) Corporate leadership includes corporate employees at director-level and above.
Biggest changeThe tables also set forth our five-year goals (established in January 2022) to increase the representation of women and members of underrepresented groups in both our general employee population and our leadership. ​ ​ ​ ​ ​ ​ ​ ​ ​ Female Talent as a Percentage of Employees ​ ​ Fiscal Year Ended Goal ​ December 30, 2023 ​ December 31, 2022 ​ January 1, 2022 ​ By 2027 All Employees 32% ​ 33% ​ 34% ​ 50% Corporate 53% ​ 54% ​ 53% ​ ​ Manufacturing, Warehouse and Distribution 27% ​ 28% ​ 29% ​ ​ All Leadership Employees 30% ​ 28% ​ 28% ​ 38% Corporate Leadership (1) 40% ​ 39% ​ 34% ​ ​ Manufacturing, Warehouse and Distribution Leadership (2) 25% ​ 24% ​ 26% ​ ​ ​ ​ - 12 - Table of Contents ​ ​ ​ ​ ​ ​ ​ ​ Underrepresented Talent (3) as a Percentage of Employees ​ ​ Fiscal Year Ended Goal ​ December 30, 2023 ​ December 31, 2022 ​ January 1, 2022 ​ By 2027 All Employees 38% ​ 38% ​ 32% ​ 35% Corporate 22% ​ 21% ​ 21% ​ ​ Manufacturing, Warehouse and Distribution 42% ​ 42% ​ 35% ​ ​ All Leadership Employees 25% ​ 25% ​ 18% ​ 28% Corporate Leadership (1) 8% ​ 6% ​ 10% ​ ​ Manufacturing, Warehouse and Distribution Leadership (2) 32% ​ 31% ​ 21% ​ ​ (1) Corporate leadership includes corporate employees at director-level and above.
Third parties located in U.S. and foreign locations produce our Baker’s Joy , B&M , Bear Creek Country Kitchens , Canoleo , Cream of Rice , Crock Pot , Joan of Arc , Le Sueur , MacDonald’s , McCann’s , New York Flatbreads , Regina , Spring Tree , Static Guard , Sugar Twin , TrueNorth and Underwood products and a portion of our B&G , Cary’s , Cream of Wheat , Crisco , Emeril’s , Green Giant , Las Palmas , Ortega and Victoria products under co-packing agreements or purchase orders.
Third parties located in U.S. and foreign locations produce our Baker’s Joy , B&M , Bear Creek Country Kitchens , Canoleo , Cream of Rice , Crock Pot , Joan of Arc , Le Sueur , MacDonald’s , McCann’s , New York Flatbreads , Regina , Spring Tree , Static Guard , Sugar Twin , TrueNorth and Underwood products and a portion of our B&G , Cary’s , Cream of Wheat , Crisco , Green Giant , Las Palmas , Ortega and Victoria products under co-packing agreements or purchase orders.
We have significantly increased our focus on DEI and are committed to achieving measurable improvements in results. As such, we have recently undertaken several DEI actions and initiatives, including: In July 2020, our board of directors formed a corporate social responsibility committee that has been tasked with, among other things, oversight responsibility for our DEI efforts.
We have increased our focus on DEI and are committed to achieving measurable improvements in results. As such, we have recently undertaken several DEI actions and initiatives, including: In July 2020, our board of directors formed a corporate social responsibility committee that has been tasked with, among other things, oversight responsibility for our DEI efforts.
Examples of our trademarks and registered trademarks include Ac’cent, B&G, B&G Sandwich Toppers, B&M, Baker’s Joy, Bear Creek Country Kitchens, Brer Rabbit, Canoleo, Cary’s, Clabber Girl , Cream of Rice, Cream of Wheat, Crisco, Dash, Devonsheer, Don Pepino, Durkee , Emeril’s, Grandma’s, Green Giant, Joan of Arc, Las Palmas, Le Sueur, MacDonald’s, Mama Mary’s, Maple Grove Farms of Vermont, McCann’s , Molly McButter, New York Flatbreads, New York Style, Old London, Ortega, Polaner, Regina, Sa-són, Sclafani, Spice Islands , Spring Tree, Static Guard, Sugar Twin, Tone’s , Trappey’s, TrueNorth, Underwood, Vermont Maid , Victoria , Weber and Wright’s .
Examples of our trademarks and registered trademarks include Ac’cent, B&G, B&G Sandwich Toppers, B&M, Baker’s Joy, Bear Creek Country Kitchens, Brer Rabbit, Canoleo, Cary’s, Clabber Girl , Cream of Rice, Cream of Wheat, Crisco, Dash, Devonsheer, Don Pepino, Durkee , Grandma’s, Green Giant, Joan of Arc, Las Palmas, Le Sueur, MacDonald’s, Mama Mary’s, Maple Grove Farms of Vermont, McCann’s , Molly McButter, New York Flatbreads, New York Style, Old London, Ortega, Polaner, Regina, Sa-són, Sclafani, Spice Islands , Spring Tree, Static Guard, Sugar Twin, Tone’s , Trappey’s, TrueNorth, Underwood, Vermont Maid , Victoria and Wright’s .
We are encouraging our business leaders to work closely with our procurement team to identify diverse suppliers so that they are provided with meaningful opportunities to compete for our business and so that we can expand our outreach and support to small- and large-scale suppliers from underrepresented communities. Discrimination and Harassment.
We are encouraging our business leaders to work closely with our procurement team to identify diverse suppliers so that they are provided with meaningful opportunities to compete for our business and so that we can expand our outreach and support to small- and large-scale suppliers from underrepresented communities.
The B&M brand was introduced in 1927. The B&M line includes a variety of baked beans and brown bread. The B&M brand currently has a leading market share in the New England region. The McCann’s brand has been in existence since 1800 and offers classic traditional steel cut Irish oatmeal as well as convenience-oriented oatmeal products.
The B&M line includes a variety of baked beans and brown bread. The B&M brand currently has a leading market share in the New England region. The McCann’s brand has been in existence since 1800 and offers classic traditional steel cut Irish oatmeal as well as convenience-oriented oatmeal products.
Our sales managers coordinate our broker sales efforts, make key account calls with buyers or distributors and supervise broker retail coverage of the products at the store level. Our sales strategy is centered on individual brands. We allocate promotional spending for each of our brands and our regional sales managers coordinate promotions with customers.
Our sales managers coordinate our broker sales efforts, make key account calls with buyers or distributors and supervise broker retail coverage of the products at the store level. - 8 - Table of Contents Our sales strategy is centered on individual brands. We allocate promotional spending for each of our brands and our regional sales managers coordinate promotions with customers.
Based on our experience to date, we believe that the future cost of compliance with existing environmental laws and regulations (and liability for known environmental conditions) will not have a material adverse effect on our business, consolidated financial condition, results of operations or liquidity.
Based on our experience to date, we believe that the future cost of compliance with existing environmental laws and regulations (and liability for known environmental conditions) will not have a material adverse effect on our - 15 - Table of Contents business, consolidated financial condition, results of operations or liquidity.
The address for the investor relations section of our website is https://www.bgfoods.com/investor-relations. - 15 - Table of Contents The full text of the charters for each of the audit, compensation, corporate social responsibility, nominating and governance, and risk committees of our board of directors as well as our code of business conduct and ethics is available at the investor relations section of our website, https://www.bgfoods.com/investor-relations/governance/documents.
The address for the investor relations section of our website is https://www.bgfoods.com/investor-relations. The full text of the charters for each of the audit, compensation, corporate social responsibility, nominating and governance, and risk committees of our board of directors as well as our code of business conduct and ethics is available at the investor relations section of our website, https://www.bgfoods.com/investor-relations/governance/documents.
The Maple Grove Farms of Vermont brand, which originated in 1915, is one of the leading brands of pure maple syrup sold in the United States. Other products under the Maple Grove Farms of Vermont label include a line of gourmet salad dressings, sugar free syrups, marinades, fruit syrups, confections, pancake mixes and organic products.
The Maple Grove Farms of Vermont brand, which originated in 1915, is one of the leading brands of pure maple syrup sold in the United States. Other products under the Maple Grove Farms of Vermont label include a line of gourmet salad dressings, sugar free syrups, fruit-flavored syrups, pancake mixes and organic products.
We are committed to compliance with all applicable laws and regulations with respect to human rights, and our respect for the protection and preservation of human rights is guided by the principles set forth in the United Nations Universal Declaration of Human - 13 - Table of Contents Rights.
We are committed to compliance with all applicable laws and regulations with respect to human rights, and our respect for the protection and preservation of human rights is guided by the principles set forth in the United Nations Universal Declaration of Human Rights.
Additionally, our marketing department works in conjunction with the sales department to coordinate special account activities and marketing support, such as couponing, public relations and media advertising. We have a national sales force that is capable of supporting our current brands and quickly integrating and supporting any newly acquired brands. Marketing.
Additionally, our marketing employees work in conjunction with our sales department to coordinate special account activities and marketing support, such as couponing, public relations and media advertising. We have a national sales force that is capable of supporting our current brands and quickly integrating and supporting any newly acquired brands. Marketing.
For example, we sell Weber seasonings and other flavor enhancers pursuant to a licensing agreement with Weber-Stephen Products LLC, Emeril’s brand products pursuant to a license agreement with a subsidiary of Marquee Brands, Crockpot seasoning mixes pursuant to a license agreement with Sunbeam Products, Inc., Skinnygirl fat free and sugar free salad dressings and sugar free cocktail inspired preserves pursuant to a license agreement with Better Bites, LLC, Cinnamon Toast Crunch Cinnadust seasoning blend and Cinnamon Toast Crunch creamy cinnamon spread pursuant to a license agreements with a subsidiary of General Mills, Inc., Snickers and Twix shakers seasoning blends pursuant to a license agreement with a subsidiary of Mars, Inc., Einstein Bros. everything bagel seasoning blend pursuant to a license agreement with Einstein Noah Restaurant Group, Inc., and Cream of Wheat Cinnabon ® , a co-branded product, pursuant to a license agreement with a subsidiary of Cinnabon Franchisor SPV LLC.
For example, we sell Weber seasonings and other flavor enhancers pursuant to a licensing agreement with Weber-Stephen Products LLC, Crockpot seasoning mixes pursuant to a license agreement with Sunbeam Products, Inc., Skinnygirl fat free and sugar free salad dressings and sugar free cocktail inspired preserves pursuant to a license agreement with Better Bites, LLC, Cinnamon Toast Crunch Cinnadust seasoning blend and Cinnamon Toast Crunch creamy cinnamon spread pursuant to a license agreements with a subsidiary of General Mills, Inc., Einstein Bros. everything bagel seasoning blend pursuant to a license agreement with Einstein Noah Restaurant Group, Inc., and Cream of Wheat Cinnabon ® , a co-branded product, pursuant to a license agreement with a subsidiary of Cinnabon Franchisor SPV LLC.
Outbound License Agreements. We also from time to time enter into outbound license agreements for our trademarks and other intellectual property. For example, the Green Giant trademark is licensed to third parties for use in connection with their sale of fresh produce in the United States and Europe.
Outbound License Agreements. We also from time to time enter into outbound license agreements for our trademarks and other intellectual property. For example, the Green Giant trademark and related intellectual property are licensed to third parties for use in connection with their sale of fresh produce in the United States and Europe and shelf-stable products in the United States.
To the extent that we are unable to offset present and future cost increases through pricing and cost savings initiatives, our operating results will be negatively impacted. Customers Our top ten customers accounted for approximately 60.5% of our net sales and approximately 60.3% of our end of the year receivables for fiscal 2022.
To the extent that we are unable to offset present and future cost increases through pricing and cost savings initiatives, our operating results will be negatively impacted. Customers Our top ten customers accounted for approximately 60.8% of our net sales and approximately 63.1% of our end of the year receivables for fiscal 2023.
We also license the Green Giant name and related intellectual property to General Mills for use with its sale of frozen and shelf-stable products in parts of Europe, Asia and in various other locations outside of the United States and Canada. Human Capital As of December 31, 2022, our workforce consisted of 3,085 employees.
We also license the Green Giant name and related intellectual property to General Mills for use with its sale of frozen and shelf-stable products in parts of Europe, Asia and in various other locations outside of the United States and Canada. Human Capital As of December 30, 2023, our workforce consisted of 2,912 employees.
We purchase most of the produce used to make our frozen and shelf-stable canned vegetables, pickles, relishes, peppers, tomatoes and other related specialty items during the months of June through October, and we generally purchase the majority of our maple syrup requirements during the months of April through August. Consequently, our liquidity needs are greatest during these periods.
We purchase most of the produce used to make our frozen and shelf-stable canned vegetables, pickles, relishes, peppers, tomatoes and other related specialty items during the months of June through October, and we generally purchase the majority of our maple syrup requirements during the months of April through August.
The Old London brand was created in 1932 and offers a variety of flavors available in melba toast snacks. Old London also markets specialty snacks under the Devonsheer brand name. The Trappey’s brand, which was introduced in 1898, has a Louisiana heritage. Trappey’s products fall into two major categories—high quality peppers and hot sauces, including Trappey’s Red Devil .
Trappey’s products fall into two major categories—high quality peppers and hot sauces, including Trappey’s Red Devil . The Old London brand was created in 1932 and offers a variety of flavors available in melba toast snacks. Old London also markets specialty snacks under the Devonsheer brand name. The B&M brand was introduced in 1927.
We experienced sudden and high cost inflation in fiscal 2021 and fiscal 2022 and expect cost inflation to remain high and possibly continue to increase in fiscal 2023. We attempt to manage these risks by entering into short-term supply contracts and advance commodities purchase agreements, implementing cost saving measures and raising sales prices.
We experienced sudden and high cost inflation in fiscal 2021, fiscal 2022 and early 2023. Costs remained elevated in fiscal 2023, and we expect costs to remain elevated in fiscal 2024. We attempt to manage these risks by entering into short-term supply contracts and advance commodities purchase agreements, implementing cost saving measures and raising sales prices.
The table below includes some of the acquisitions and the divestitures we have completed in recent years: Date Significant Event January 2023 ​ Divestiture of the Back to Nature business, which was sold to Barilla America, referred to as the “ Back to Nature sale” in the remainder of this report. ​ May 2022 ​ Acquisition of the frozen vegetable manufacturing operations of Growers Express, LLC, referred to as the “Yuma acquisition” in the remainder of this report. ​ December 2020 ​ Acquisition of the Crisco brand of oils and shortening from The J.
The table below includes some of the acquisitions and the divestitures we have completed in recent years: Date Significant Event November 2023 ​ Divestiture of the Green Giant U.S. shelf-stable product line, which was sold to Seneca Foods Corporation, referred to as the “ Green Giant U.S. shelf-stable divestiture” in the remainder of this report. ​ January 2023 ​ Divestiture of the Back to Nature business, which was sold to Barilla America, referred to as the “ Back to Nature sale” in the remainder of this report. ​ May 2022 ​ Acquisition of the frozen vegetable manufacturing operations of Growers Express, LLC, referred to as the “Yuma acquisition” in the remainder of this report. ​ December 2020 ​ Acquisition of the Crisco brand of oils and shortening from The J.
While we believe that our relations with our union employees are in general good, we cannot assure you that we will be able to negotiate new collective bargaining agreements for our Cincinnati, Brooklyn and Mexico facilities on terms satisfactory to us, or at all, and without production interruptions, including labor stoppages.
While we believe that our relations with our union employees are in general good, we cannot assure you that we will be able to negotiate a new collective bargaining agreement for our Terre Haute facility on terms satisfactory to us, or at all, and without production interruptions, including labor stoppages.
Over the next year, we plan to enhance our public disclosures regarding the steps we have been taking over the years to minimize our impact on the environment, including the progress we have been making to achieve our environmental sustainability goals. Environmental Laws and Regulations. We are also subject to environmental laws and regulations in the normal course of business.
Over the next year, we plan to enhance our public disclosures regarding the steps we have been taking over the years to minimize our impact on the environment, including the progress we have been making to achieve our environmental sustainability goals. Environmental Laws and Regulations.
The Spring Tree brand originated in 1976 in Brattleboro, Vermont, and consists of pure maple syrup and sugar free syrup. The Don Pepino and Sclafani brands originated in 1955 and 1900, respectively, and primarily include pizza and spaghetti sauces, whole and crushed tomatoes and tomato puree.
The Spring Tree brand originated in 1976 in Brattleboro, Vermont, and consists of pure maple syrup and sugar free syrup. The Don Pepino and Sclafani brands originated in 1955 and 1900, respectively, and primarily include pizza and spaghetti sauces, whole and crushed tomatoes and tomato puree. The Trappey’s brand, which was introduced in 1898, has a Louisiana heritage.
Our goal is to continue to increase sales, profitability and cash flows through organic growth, disciplined acquisitions of complementary branded businesses and new product development. Since 1996, we have successfully acquired and integrated more than 50 brands into our company.
Our company has been built upon a successful track record of both organic and acquisition-related growth. Our goal is to continue to increase sales, profitability and cash flows through organic growth, disciplined acquisitions of complementary branded businesses and new product development. Since 1996, we have successfully acquired and integrated more than 50 brands into our company.
For example, despite higher rates for freight in 2021 and 2022, we were able to offset a portion of the freight cost increases through pricing, which included both list price increases and trade spend optimization. Freight rates increased significantly during the fourth quarter of 2020, fiscal 2021 and fiscal 2022, and we expect freight rates to remain elevated in 2023.
For example, despite higher rates for freight in 2021 and 2022, we were able to offset a portion of the freight cost increases through pricing, which included both list price increases and trade spend optimization. Although freight rates began to decline in 2023, we expect freight rates to remain elevated into fiscal 2024.
Competition We face competition in each of our product lines. Numerous brands and products compete for shelf space and sales, with competition based primarily on product quality, convenience, price, trade promotion, consumer promotion, brand recognition and loyalty, customer service, advertising and other activities and the ability to identify and satisfy emerging consumer preferences.
Numerous brands and products compete for shelf space and sales, with competition based primarily on product quality, convenience, price, trade promotion, consumer promotion, brand recognition and loyalty, customer service, advertising and other activities and the ability to identify and satisfy emerging consumer preferences. We compete with numerous companies of varying sizes, including divisions or subsidiaries of larger companies.
We have collective bargaining agreements covering employees at six of our facilities in the United States, which vary in term depending on the location: ​ ​ ​ ​ ​ Facility Location Union Effective Date Expiration Date No. of Employees Covered (1) Ankeny, IA International Brotherhood of Teamsters, Local No. 238 Apr. 5, 2020 Apr. 6, 2025 298 Brooklyn, NY United Food and Commercial Workers Union, Local No. 342 Jan. 1, 2020 Dec. 31, 2023 53 Cincinnati, OH The Employees Representation Association May 1, 2020 Apr. 30, 2023 125 Roseland, NJ International Brotherhood of Teamsters, Chauffeurs, Warehousemen & Helpers of America, Local No. 863 Apr. 1, 2020 Mar. 31, 2026 49 Stoughton, WI Drivers, Salesmen, Warehousemen, Milk Processors, Cannery, Dairy Employees and Helpers Union, Local No. 695 Mar. 28, 2021 Mar. 26, 2026 80 Terre Haute, IN Chauffeurs, Teamsters, Warehousemen and Helpers Union, Local No. 135 Mar. 28, 2021 Mar. 30, 2024 108 (1) As of December 31, 2022.
We have collective bargaining agreements covering employees at six of our facilities in the United States, and one facility in Mexico, which vary in term depending on the location: ​ ​ ​ ​ ​ Facility Location Union Effective Date Expiration Date No. of Employees Covered (1) Ankeny, IA International Brotherhood of Teamsters, Local No. 238 Apr. 5, 2020 Apr. 6, 2025 313 Brooklyn, NY United Food and Commercial Workers Union, Local No. 342 Jan. 1, 2020 Dec. 31, 2023 (2) 41 Cincinnati, OH The Employees Representation Association May 1, 2020 Apr. 30, 2027 122 Irapuato, MX National Union of Frozen and Packaging Food Processors, Similar and Related, Confederation of Mexican Workers (CTM) April 14, 2023 (3) ​ 868 Roseland, NJ International Brotherhood of Teamsters, Chauffeurs, Warehousemen & Helpers of America, Local No. 863 Apr. 1, 2020 Mar. 31, 2026 50 Stoughton, WI Drivers, Salesmen, Warehousemen, Milk Processors, Cannery, Dairy Employees and Helpers Union, Local No. 695 Mar. 28, 2021 Mar. 26, 2026 57 Terre Haute, IN Chauffeurs, Teamsters, Warehousemen and Helpers Union, Local No. 135 Mar. 28, 2021 Mar. 30, 2024 111 (1) As of December 30, 2023.
Of that total, 2,661 employees were engaged in manufacturing, 144 were engaged in marketing and sales, 165 were engaged in warehouse and distribution and 115 were engaged in administration. Approximately 57.0% of our employees, located at six manufacturing facilities in the United States and one manufacturing facility in Mexico, are covered by collective bargaining agreements.
Of that total, 2,449 employees were engaged in manufacturing, 155 were engaged in marketing and sales, 186 were engaged in warehouse and distribution and 122 were engaged in administration. Approximately 53.6% of our employees, located at six manufacturing facilities in the United States and one manufacturing facility in Mexico, are covered by collective bargaining agreements.
The Victoria brand offers a variety of premium pasta and specialty sauces, savory condiments and tasty gourmet spreads. Using traditional cooking methods, Victoria sauces are slow kettle-cooked to ensure rich flavor and a homemade taste. Committed to its values of quality, honesty, authenticity and community, Victoria believes that Ingredients Come First .
Victoria Fine Foods is a Brooklyn-based business founded in 1929. The Victoria brand offers a variety of premium pasta and specialty sauces. Using traditional cooking methods, Victoria sauces are slow kettle-cooked to ensure rich flavor and a homemade taste. Committed to its values of quality, honesty, authenticity and community, Victoria believes that Ingredients Come First .
We have and will continue to communicate to our employees, supply chain partners and other stakeholders our commitment to human rights through our Code, our supplier code of conduct and our human rights policy. Safety & Health at Work. We are committed to ensuring the health and safety of our employees and expect the same from our supply chain partners.
We have and will continue to communicate to our employees, supply chain partners and other stakeholders our commitment to human rights through our Code, our supplier code of conduct and our human rights policy. - 13 - Table of Contents Safety & Health at Work.
Other than Walmart, which accounted for approximately 27.3% of our fiscal 2022 net sales, no single customer accounted for 10.0% or more of our fiscal 2022 net sales. Other than Walmart, which accounted for approximately 30.6% of our receivables as of December 31, 2022, no single customer accounted for more than 10.0% of our receivables as of December 31, 2022.
Other than Walmart, which accounted for approximately 28.8% of our fiscal 2023 net sales, no single customer accounted for 10.0% or more of our fiscal 2023 net sales. Other than Walmart, which accounted for approximately 30.7% of our receivables as of December 30, 2023, no single customer accounted for more than 10.0% of our receivables as of December 30, 2023.
We sell our products primarily through broker sales networks to supermarket chains, foodservice outlets, mass merchants, warehouse clubs, non-food outlets and specialty distributors. The broker sales network handles the sale of our products at the retail level. - 8 - Table of Contents Sales.
We sell our products directly and through broker sales networks to supermarket chains, foodservice outlets, mass merchants, warehouse clubs, non- food outlets and specialty distributors. Depending on the customer, either our internal sales force or our broker sales network handles the sale of our products at the retail level. Sales.
This line consists of shelf-stable pickles, peppers, relishes, olives and other related specialty items. The Ac’cent brand was introduced in 1947 as a flavor enhancer for meat preparation and is generally used on beef, poultry, fish and vegetables. We believe that Ac’cent is positioned as a unique flavor enhancer that provides food with the “umami” flavor sensation.
The Ac’cent brand was introduced in 1947 as a flavor enhancer for meat preparation and is generally used on beef, poultry, fish and vegetables. We believe that Ac’cent is positioned as a unique flavor enhancer that provides food with the “umami” flavor sensation.
We strive to hire people more talented than we are. We empower our people to make the decisions needed today, and prepare them for even bigger decisions they will make in the future. We support professional development by providing access to internal and external training resources and programs. Diversity, Equity and Inclusion (DEI).
We empower our people to make the decisions needed today, and prepare them for even bigger decisions they will make in the future. We support professional development by providing access to internal and external training resources and programs. Diversity, Equity and Inclusion (DEI). At B&G Foods, we foster a culture of collaboration.
Our manufacturing facilities and products are subject to periodic inspection by federal, state, local and foreign authorities. We are subject to the Food, Drug and Cosmetic Act and the Food Safety Modernization Act and the regulations promulgated thereunder by the FDA.
Our manufacturing facilities and products are subject to periodic inspection by federal, state, local and foreign authorities. We are subject to the Food, Drug and Cosmetic Act and the Food Safety Modernization Act and the regulations promulgated thereunder by the FDA. This comprehensive regulatory program governs, among other things, the manufacturing, composition and ingredients, labeling, packaging and safety of food.
The Static Guard brand, the number one brand name in static elimination sprays, created the anti-static spray category when it was launched in 1978 to fulfill a previously unmet consumer need.
Wright’s is offered in three flavors: Hickory, Mesquite and Applewood. - 7 - Table of Contents The Static Guard brand, the number one brand name in static elimination sprays, created the anti-static spray category when it was launched in 1978 to fulfill a previously unmet consumer need.
B&G Foods manufactures, sells and distributes a diverse portfolio of branded, high quality, shelf-stable and frozen food and household products across the United States, Canada and Puerto Rico. Many of our branded products have leading regional or national market shares. In general, we position our products to appeal to the consumer desiring a high quality and reasonably priced product.
Fiscal 2024 contains, and fiscal 2023, 2022 and 2021 each contained, 52 weeks. B&G Foods manufactures, sells and distributes a diverse portfolio of branded, high quality, shelf-stable and frozen food and household products across the United States, Canada and Puerto Rico. Many of our branded products have leading regional or national market shares.
The Las Palmas brand originated in 1922 and primarily includes authentic Mexican enchilada sauce, chili sauce and various pepper products. The Bear Creek Country Kitchens brand is the leading brand of hearty dry soups in the United States. Bear Creek Country Kitchens also offers a line of savory pasta dishes and hearty rice dishes.
The Bear Creek Country Kitchens brand is the leading brand of hearty dry soups in the United States. Bear Creek Country Kitchens also offers a line of savory pasta dishes and hearty rice dishes.
We do this in part by monitoring employee engagement and satisfaction through periodic employee engagement surveys. In 2020, we expanded our employee engagement survey to include additional questions regarding diversity, equity and inclusion. Employee Empowerment, Training and Professional Development. We enable and encourage our employees to grow, excel and realize their full potential.
We do this in part by monitoring employee engagement and satisfaction through periodic employee engagement surveys. Employee Empowerment, Training and Professional Development. We enable and encourage our employees to grow, excel and realize their full potential. We strive to hire people more talented than we are.
Mama Mary’s also offers pizza sauces and premium gourmet pepperoni slices. The Polaner brand was introduced in 1880 and is comprised of a broad array of fruit-based spreads as well as jarred wet spices such as chopped garlic and oregano. Polaner All Fruit is a leading national brand of fruit-juice - 6 - Table of Contents sweetened fruit spread.
The Polaner brand was introduced in 1880 and is comprised of a broad array of fruit-based spreads as well as jarred wet spices such as chopped garlic and oregano. Polaner All Fruit is a leading national brand of fruit-juice sweetened fruit spread. The spreads are available in more than a dozen flavors.
In recent years, however, excluding the impact of the COVID-19 pandemic, many traditional center of store grocery brands in the industry have often experienced flat to modestly declining sales.
Historically, it has been characterized by relatively stable sales growth, based largely on price and population increases. In recent years, however, excluding the impact of the COVID-19 pandemic, many traditional center of store grocery brands in the industry have often experienced flat to modestly declining sales.
Under the Bio-Terrorism Act we are required, among other things, to provide specific information about the food products we ship into the United States and to register our manufacturing, warehouse and distribution facilities with the FDA.
Under the Bio-Terrorism Act we are required, among other things, to provide specific information about the food products we ship into the United States and to register our manufacturing, warehouse and distribution facilities with the FDA. - 14 - Table of Contents We believe that we are currently in substantial compliance with all material governmental laws and regulations and maintain all material permits and licenses relating to our operations.
As noted in the table and paragraph above, four of our collective bargaining agreements, covering employees at our Cincinnati, Brooklyn and Mexico facilities, are scheduled to expire in the next twelve months.
As noted in the table above, one of our collective bargaining agreements, covering employees at our Terre Haute facility, is scheduled to expire in the next twelve months.
The Spice Islands brand, established in San Francisco in 1941, is a leading premium spices and extracts brand offering a diverse line of high quality products including spices, seasonings, dried herbs, extracts, flavorings and sauce blends. The brand’s offerings include organic products. The Mama Mary’s brand was introduced in 1986 and is a leading brand of shelf-stable pizza crusts.
Polaner Sugar Free preserves are the second leading brand of sugar free preserves nationally. The Spice Islands brand, established in San Francisco in 1941, is a leading premium spices and extracts brand offering a diverse line of high quality products including spices, seasonings, dried herbs, extracts, flavorings and sauce blends.
Dash’s brand essence, “Salt-Free, Flavor-Full,” resonates with consumers and underscores the brand’s commitment to provide healthy products that fulfill consumers’ expectations for taste. Prior to 2020, the brand was known as Mrs. Dash . Victoria Fine Foods is a Brooklyn-based business founded in 1929.
Dash’s brand essence, “Salt-Free, Flavor-Full,” resonates with consumers and underscores the brand’s commitment to provide healthy products that fulfill consumers’ expectations for taste. Prior to 2020, the brand was known as Mrs. Dash . The Las Palmas brand originated in 1922 and primarily includes authentic Mexican enchilada sauce, chili sauce and various pepper products.
Our supplier code of conduct, environmental, health and safety policy, human rights policy, water stewardship policy and philanthropy principles are available in the responsibility section of our website, https://www.bgfoods.com/about/responsibility. The information contained on our website is not part of, and is not incorporated in, this or any other report we file with or furnish to the SEC.
Our supplier code of conduct, environmental, health and safety policy, human rights policy, water stewardship policy, philanthropy principles, and inaugural corporate social responsibility report are available in the responsibility section of our website, https://www.bgfoods.com/about/responsibility.
We operate twelve manufacturing facilities for our products. See Item 2, “Properties” for a listing of our manufacturing facilities. Co-Packing Arrangements. In addition to our own manufacturing facilities, we source a significant portion of our products under “co-packing” arrangements, a common industry practice in which manufacturing is outsourced to other companies.
In addition to our own manufacturing facilities, we source a significant portion of our products under “co-packing” arrangements, a common industry practice in which manufacturing is outsourced to other companies. We regularly evaluate our co-packing arrangements to ensure the most cost-effective manufacturing of our products and to utilize company-owned manufacturing facilities most effectively.
During the past several years, our cost saving measures and sales price increases have not been sufficient to fully offset increases to our raw material, ingredient and packaging costs. To the extent we are unable to offset present and future cost increases, our operating results will be negatively impacted. - 10 - Table of Contents Production Manufacturing.
During the past several years, our cost saving measures and sales price increases have not been sufficient to fully offset increases to our raw material, ingredient and packaging costs.
We have not made any material expenditures during the last three fiscal years in order to comply with environmental laws or regulations.
While we have not made any material expenditures during the last three fiscal years in order to comply with environmental laws or regulations or our sustainability goals, changes in environmental compliance requirements, and expenditures necessary to comply with such requirements or to achieve our sustainability goals, could adversely affect our financial performance.
The Baker’s Joy brand was introduced in 1982 and is the original brand of no-stick baking spray with flour. Baker’s Joy ’s product proposition has been to “generate a perfect release from the pan every time,” making baking easier, faster and more successful for everyday bakers. The TrueNorth brand was introduced in 2008.
Baker’s Joy ’s product proposition has been to “generate a perfect release from the pan every time,” making baking easier, faster and more successful for everyday bakers. The Regina brand, which has been in existence since 1949, includes vinegars and cooking wines.
Our foreign sales are primarily to customers in Canada. - 9 - Table of Contents Seasonality Sales of a number of our products tend to be seasonal and may be influenced by holidays, changes in seasons/weather or certain other annual events. In general, our sales are higher in the first and fourth quarters.
During fiscal 2023, 2022 and 2021, our net sales to foreign countries represented approximately 8.6%, 7.8% and 8.3%, respectively, of our total net sales. Our foreign sales are primarily to customers in Canada. Seasonality Sales of a number of our products tend to be seasonal and may be influenced by holidays, changes in seasons/weather or certain other annual events.
The tables below provide information regarding the percentages of our employees who are female or from underrepresented groups as compared to our overall employee population and our leadership.
We are committed to fostering an inclusive work environment where all employees have the opportunity to share their ideas, grow with our company, and realize their full potential. The tables below provide information regarding the percentages of our employees who are female or from underrepresented groups as compared to our overall employee population and our leadership.
For more information about some of our key environmental sustainability initiatives, and for copies of our environmental, health and safety policy and our water stewardship policy, please see https://www.bgfoods.com/about/responsibility. The information contained on our website is not part of, and is not incorporated in, this or any other report we file with or furnish to the SEC.
For more information about some of our key environmental sustainability initiatives, and for copies of our environmental, health and safety policy, our water stewardship policy and our inaugural corporate social responsibility report, please see https://www.bgfoods.com/about/responsibility.
This comprehensive regulatory program governs, among other things, the - 14 - Table of Contents manufacturing, composition and ingredients, labeling, packaging and safety of food. We are also subject to the U.S. Bio-Terrorism Act of 2002 which imposes on us import and export regulations.
We are also subject to the U.S. Bio-Terrorism Act of 2002 which imposes on us import and export regulations.
Throughout this report, we refer to our fiscal years ended December 29, 2018, December 28, 2019, January 2, 2021, January 1, 2022, December 31, 2022 and December 30, 2023 as “fiscal 2018,” “fiscal 2019,” “fiscal 2020,” “fiscal 2021,” “fiscal 2022” and “fiscal 2023,” respectively.
Throughout this report, we refer to our fiscal years ended January 1, 2022, December 31, 2022, December 30, 2023 and December 28, 2024 as “fiscal 2021,” “fiscal 2022,” “fiscal 2023” and “fiscal 2024,” respectively. Our fiscal year is the 52 or 53 week reporting period ending on the Saturday closest to December 31.
The Vermont Maid brand has been in existence since 1919 and offers maple-flavored syrups. Vermont Maid syrup is available in regular, sugar-free and sugar-free butter varieties. The New York Flatbreads brand is a line of thin, crispy, flavorful crispbread that is available in several toppings. The Molly McButter brand created the butter-flavored sprinkles category in 1987.
The New York Flatbreads brand is a line of thin, crispy, flavorful crispbread that is available in several toppings. The Molly McButter brand created the butter-flavored sprinkles category in 1987. Molly McButter is available in butter and cheese flavors. Food Industry The food industry is one of the United States’ largest industries.
Our products compete not only against other brands in their respective product categories, but also against products in similar or related product categories.
In addition, from time to time, we experience margin pressure in certain markets as a result of competitors’ pricing practices. Our products compete not only against other brands in their respective product categories, but also against products in similar or related product categories.
TrueNorth nut cluster snacks combine freshly roasted nuts, a dash of sea salt and just a hint of sweetness. TrueNorth varieties include almond pecan crunch, chocolate nut crunch and cashew crunch. The Cary’s brand originated in 1904 and is the oldest brand of pure maple syrup in the United States. Cary’s also offers sugar free syrup.
TrueNorth nut cluster snacks combine freshly roasted nuts, a dash of sea salt and just a hint of sweetness. TrueNorth varieties include almond pecan crunch, chocolate nut crunch and cashew crunch. The Wright’s brand was introduced in 1895 and is a seasoning that reproduces the flavor and aroma of pit smoking in meats, chicken and fish.
The Sa-són brand was introduced in 1947 as a flavor enhancer used primarily for Puerto Rican and Hispanic food preparation. The product is generally used on beef, poultry, fish and vegetables. The brand’s flavor enhancer is offered in four flavors: Original, Coriander and Achiote, Garlic and Onion, and Tomato. We also offer reduced sodium versions of Sa-són .
Mild molasses is designed for table use and full-flavored molasses is typically used in baking, barbeque sauces and as a breakfast syrup. The Sa-són brand was introduced in 1947 as a flavor enhancer used primarily for Puerto Rican and Hispanic food preparation. The product is generally used on beef, poultry, fish and vegetables.
We are committed to preventing accidents, injuries and illnesses related to the workplace.
We are committed to ensuring the health and safety of our employees and expect the same from our supply chain partners. We are committed to preventing accidents, injuries and illnesses related to the workplace.
We are currently collecting baseline data relating to our sustainable packaging, conservation of energy and water, and reduction of waste goals.
The information contained on our website is not part of, and is not incorporated in, this or any other report we file with or furnish to the SEC. We are currently collecting baseline data relating to our sustainable packaging, conservation of energy and water, and reduction of waste goals.
We complement our branded product retail sales with institutional and foodservice sales and private label sales. B&G Foods, including our subsidiaries and predecessors, has been in business for over 125 years. We were incorporated in Delaware on November 25, 1996 under the name B Companies Holdings Corp. On August 11, 1997, we changed our name to B&G Foods Holdings Corp.
In general, we position our products to appeal to the consumer desiring a high quality and reasonably priced product. We complement our branded product retail sales with institutional and foodservice sales and private label sales. B&G Foods, including our subsidiaries and predecessors, has been in business for over 130 years.
The Tone’s brand sells predominantly in the club channel while also servicing traditional grocery. The Underwood brand’s “ Underwood Devil ” logo, which was registered in 1870, is believed to be the oldest registered trademark still in use for a prepackaged food product in the United States.
The Underwood brand’s “ Underwood Devil ” logo, which was registered in 1870, is believed to be the oldest registered trademark still in use for a prepackaged food product in the United States. Underwood meat spreads, which were introduced in the late 1860s, include deviled ham, white-meat chicken, roast beef, corned beef and liverwurst.
We compete with numerous companies of varying sizes, including divisions or subsidiaries of larger companies. Many of these competitors have multiple product lines, substantially greater financial and other resources and may have lower fixed costs and/or be substantially less leveraged than we are.
Many of these competitors have multiple product lines, substantially greater financial and other resources and may have lower fixed costs and/or be substantially less leveraged than we are. Our ability to grow our business could be impacted by the relative effectiveness of, and competitive response to, our product initiatives, product innovation, advertising and promotional activities.
The spreads are available in more than a dozen flavors. Polaner Sugar Free preserves are the second leading brand of sugar free preserves nationally. The Tone’s brand started as a family business in 1873 and was responsible for many of the early advancements in the spice industry.
The Tone’s brand started as a family business in 1873 and was responsible for many of the early advancements in the spice industry. The Tone’s brand sells predominantly in the club channel while also servicing traditional grocery.
The Regina brand, which has been in existence since 1949, includes vinegars and cooking wines. Regina products are most commonly used in the preparation of salad dressings as well as in a variety of recipe applications, including sauces, marinades and soups.
Regina products are most commonly used in the preparation of salad dressings as well as in a variety of recipe applications, including sauces, marinades and soups. The Durkee brand was established in 1850 and, like our Tone’s brand, started as a family business and was an early leader in the spice industry. The TrueNorth brand was introduced in 2008.
The Brer Rabbit brand has been in existence since 1907 and currently offers mild and full-flavored molasses as well as blackstrap molasses. Mild molasses is designed for table use and full-flavored molasses is typically used in baking, barbeque sauces and as a breakfast syrup.
The Joan of Arc brand, which originated in 1895, includes a full range of canned beans including kidney, chili and other varieties. The Brer Rabbit brand has been in existence since 1907 and currently offers mild and full-flavored molasses as well as blackstrap molasses.
The brand’s ability to consistently deliver on its promise to “instantly eliminate static cling” has resulted in a loyal consumer following. - 7 - Table of Contents The Durkee brand was established in 1850 and, like our Tone’s brand, started as a family business and was an early leader in the spice industry.
The brand’s ability to consistently deliver on its promise to “instantly eliminate static cling” has resulted in a loyal consumer following. The Sugar Twin brand, primarily sold in Canada, was developed in 1968 and is a calorie free sugar substitute.
Underwood meat spreads, which were introduced in the late 1860s, include deviled ham, white-meat chicken, roast beef, corned beef and liverwurst. The Bloch & Guggenheimer (B&G) brand originated in 1889, and its pickle, pepper and relish products are a leading brand in the New York metropolitan area.
The Bloch & Guggenheimer (B&G) brand originated in 1889, and its pickle, pepper and relish products are a leading brand in the New York metropolitan area. This line consists of shelf-stable pickles, peppers, relishes, olives and other related specialty items.
On October 14, 2004, B&G Foods, Inc., then our wholly owned subsidiary, was merged with and into us and we were renamed B&G Foods, Inc. Our company has been built upon a successful track record of both organic and acquisition-related growth.
We were incorporated in Delaware on November 25, 1996 under the name B Companies Holdings Corp. On August 11, 1997, we changed our name to B&G Foods Holdings Corp. On October 14, 2004, B&G Foods, Inc., then our wholly owned subsidiary, was merged with and into us and we were renamed B&G Foods, Inc.
Removed
Our fiscal year is the 52 or 53 week reporting period ending on the Saturday closest to December 31. Fiscal 2023 contains, and fiscal 2022, 2021, 2019 and 2018 each contained, 52 weeks. Fiscal 2020 contained 53 weeks.
Added
The brand’s offerings include organic products. - 6 - Table of Contents The Mama Mary’s brand was introduced in 1986 and is a leading brand of shelf-stable pizza crusts. Mama Mary’s also offers pizza sauces and premium gourmet pepperoni slices.
Removed
The Wright’s brand was introduced in 1895 and is a seasoning that reproduces the flavor and aroma of pit smoking in meats, chicken and fish. Wright’s is offered in three flavors: Hickory, Mesquite and Applewood. The Sugar Twin brand, primarily sold in Canada, was developed in 1968 and is a calorie free sugar substitute.
Added
The Cary’s brand originated in 1904 and is the oldest brand of pure maple syrup in the United States. Cary’s also offers sugar free syrup. The Baker’s Joy brand was introduced in 1982 and is the original brand of no-stick baking spray with flour.
Removed
The Emeril’s brand was introduced in 2000 under a licensing agreement with celebrity chef Emeril Lagasse. We offer a line of pasta sauces, seasonings, cooking stocks, mustards and cooking sprays under the Emeril’s brand name. The Joan of Arc brand, which originated in 1895, includes a full range of canned beans including kidney, chili and other varieties.
Added
The brand’s flavor enhancer is offered in four flavors: Original, Coriander and Achiote, Garlic and Onion, and Tomato. We also offer reduced sodium versions of Sa-són . The Vermont Maid brand has been in existence since 1919 and offers maple-flavored syrups. Vermont Maid syrup is available in regular, sugar-free and sugar-free butter varieties.
Removed
Molly McButter is available in butter and cheese flavors. The Canoleo brand offers an all-purpose margarine used for spreading, cooking and baking. Food Industry The food industry is one of the United States’ largest industries. Historically, it has been characterized by relatively stable sales growth, based largely on price and population increases.
Added
In general, our sales are higher in the first and fourth quarters.
Removed
During fiscal 2022, 2021 and 2020, our net sales to foreign countries represented approximately 7.8%, 8.3% and 7.8%, respectively, of our total net sales.
Added
Consequently, our liquidity needs are greatest during these periods. - 9 - Table of Contents Competition We face competition in each of our product lines.

… 24 more changes not shown on this page.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

50 edited+15 added−9 removed160 unchanged
Biggest changeThe ability of our subsidiaries to pay dividends or make other payments or distributions to us depends on their respective operating results and may be restricted by, among other things, the laws of their jurisdiction of organization (which may limit the amount of funds available for the payment of dividends), agreements of those subsidiaries, our credit agreement, our senior notes indentures and the covenants of any future outstanding indebtedness we or our subsidiaries incur.
Biggest changeThe ability of our subsidiaries to pay dividends or make other payments or distributions to us depends on their respective operating results and may be restricted by, among other things, the laws of their jurisdiction of organization (which may limit the amount of funds available for the payment of dividends), agreements of those subsidiaries, our credit agreement, our senior secured notes indenture, our senior notes indentures and the covenants of any future outstanding indebtedness we or our subsidiaries incur. - 26 - Table of Contents Future changes that increase cash taxes payable by us could significantly decrease our future cash flow available to make interest and dividend payments with respect to our securities and have a material adverse effect on our business, consolidated financial condition, results of operations and liquidity.
In addition, our annual impairment tests for fiscal 2021 resulted in our company recording non-cash impairment charges to intangible trademark assets for the SnackWell’s , Static Guard , Molly McButter and Farmwise brands of $23.1 million in the aggregate during the fourth quarter of fiscal 2021, which is recorded in “Impairment of intangible assets” in our consolidated statement of operations for fiscal 2021.
Our annual impairment tests for fiscal 2021 resulted in our company recording non-cash impairment charges to intangible trademark assets for the SnackWell’s , Static Guard , Molly McButter and Farmwise brands of $23.1 million in the aggregate during the fourth quarter of fiscal 2021, which is recorded in “Impairment of intangible assets” in our consolidated statement of operations for fiscal 2021.
In particular, our financial condition and results of operations could be materially and adversely affected by the new United States-Mexico-Canada Agreement, or other regulatory and economic impact of changes in taxation and trade relations among the United States and other countries.
In particular, our financial condition and results of operations could be materially and adversely affected by the United States-Mexico-Canada Agreement, or other regulatory and economic impact of changes in taxation and trade relations among the United States and other countries.
If our cash flows from operating activities were to fall below our minimum expectations (or if our assumptions as to capital expenditures or interest expense were too low or our assumptions as to the sufficiency of our revolving credit facility to finance our working capital needs were to prove incorrect), we may need either to reduce or eliminate dividends or, to the extent permitted under our credit agreement and senior notes indentures, fund a portion of our dividends with borrowings or from other sources.
If our cash flows from operating activities were to fall below our minimum expectations (or if our assumptions as to capital expenditures or interest expense were too low or our assumptions as to the sufficiency of our revolving credit facility to finance our working capital needs were to prove incorrect), we may need either to reduce or eliminate dividends or, to the extent permitted under our credit agreement, senior secured notes indenture and senior notes indentures, fund a portion of our dividends with borrowings or from other sources.
Future dividends with respect to shares of our capital stock, if any, depend on, among other things, our results of operations, cash requirements, financial condition, contractual restrictions (including restrictions in our credit agreement and senior notes indentures), business opportunities, provisions of applicable law (including certain provisions of the Delaware General Corporation Law) and other factors that our board of directors may deem relevant.
Future dividends with respect to shares of our capital stock, if any, depend on, among other things, our results of operations, cash requirements, financial condition, contractual restrictions (including restrictions in our credit agreement, senior secured notes indenture and senior notes indentures), business opportunities, provisions of applicable law (including certain provisions of the Delaware General Corporation Law) and other factors that our board of directors may deem relevant.
During the past several years, our cost saving measures and sales price increases have not been sufficient to fully offset increases to our raw material, ingredient, packaging and distribution costs. Moreover, during fiscal 2023 and possibly beyond, we expect to face continued industry-wide cost inflation for various inputs, including commodities, ingredients, packaging materials, other raw materials, transportation and labor.
During the past several years, our cost saving measures and sales price increases have not been sufficient to fully offset increases to our raw material, ingredient, packaging and distribution costs. Moreover, during fiscal 2024 and possibly beyond, we expect to face continued industry-wide cost inflation for various inputs, including commodities, ingredients, packaging materials, other raw materials, transportation and labor.
Significant management judgment is necessary to estimate the impact of competitive operating, macroeconomic and other factors to estimate the future levels of sales and cash flows. We completed our annual impairment tests for fiscal 2022, fiscal 2021 and fiscal 2020 with no adjustments to the carrying values of goodwill.
Significant management judgment is necessary to estimate the impact of competitive operating, macroeconomic and other factors to estimate the future levels of sales and cash flows. We completed our annual impairment tests for fiscal 2023, fiscal 2022 and fiscal 2021 with no adjustments to the carrying values of goodwill.
In addition, upon the occurrence of an event of default under our credit agreement or our senior notes indentures, the lenders could elect to declare all amounts outstanding under the credit agreement and the senior notes, together with accrued interest, to be immediately due and payable.
In addition, upon the occurrence of an event of default under our credit agreement, our senior secured notes indenture or our senior notes indentures, the lenders could elect to declare all amounts outstanding under the credit agreement and the senior notes, together with accrued interest, to be immediately due and payable.
Misuse, leakage or falsification of legally protected information could also result in a violation of data privacy laws and regulations and have a negative impact on our reputation, business, financial condition and results of operations. Failure to Comply with Data Privacy and Data Breach Laws May Subject Our Company to Fines, Administrative Actions and Reputational Harm.
Misuse, leakage or falsification of legally protected information could also result in a violation of data privacy laws and regulations and have a negative impact on our reputation, business, financial condition and results of operations. - 25 - Table of Contents Failure to Comply with Data Privacy and Data Breach Laws May Subject Our Company to Fines, Administrative Actions and Reputational Harm.
In addition, we may incur significant costs related to developing and marketing new products or expanding our existing product lines in reaction to what we perceive to be increased - 16 - Table of Contents consumer preference or demand. Such development or marketing may not result in the volume of sales or profitability anticipated.
In addition, we may incur significant costs related to developing and marketing new products or expanding our existing product lines in reaction to what we perceive to be increased consumer preference or demand. Such development or marketing may not result in the volume of sales or profitability anticipated.
In many - 25 - Table of Contents states, state data privacy laws (such as the California Consumer Privacy Act), including application and interpretation, are rapidly evolving. The rapidly evolving nature of state and federal privacy laws, including potential inconsistencies between such laws and uncertainty as to their application, adds additional compliance costs and increases our risk of non-compliance.
In many states, state data privacy laws (such as the California Consumer Privacy Act), including application and interpretation, are rapidly evolving. The rapidly evolving nature of state and federal privacy laws, including potential inconsistencies between such laws and uncertainty as to their application, adds additional compliance costs and increases our risk of non-compliance.
A determination that all or a portion of our goodwill or indefinite-lived intangible assets are impaired, although a non-cash charge to operations, could have a material adverse effect on our business, consolidated financial condition and results of operations.
A determination that all or a portion of our goodwill or indefinite-lived intangible assets are impaired, although a non-cash charge to operations, could have a material adverse effect on our business, consolidated financial condition - 28 - Table of Contents and results of operations.
The rights of the holders of shares of our common stock will be subject to, and may be adversely affected by, the rights of holders of any class or series of preferred stock that may be issued in the future. Item 1B. Unresolved Staff Comments. None. - 29 - Table of Contents
The rights of the holders of shares of our common stock will be subject to, and may be adversely affected by, the rights of holders of any class or series of preferred stock that may be issued in the future. Item 1B. Unresolved Staff Comments. None.
Any legal proceedings could result in an adverse determination that could have a material adverse effect on our business, consolidated financial condition, results of operations or liquidity. We face risks associated with our defined benefit pension plans. We maintain four company-sponsored defined benefit pension plans that cover approximately 23.9% of our employees.
Any legal proceedings could result in an adverse determination that could have a material adverse effect on our business, consolidated financial condition, results of operations or liquidity. We face risks associated with our defined benefit pension plans. We maintain four company-sponsored defined benefit pension plans that cover approximately 22.2% of our employees.
Although our credit agreement and the indentures governing our senior notes (which we refer to as the senior notes indentures) contain covenants that restrict our ability to incur debt, as long as we meet these covenants we will be able to incur additional indebtedness.
Although our credit agreement and the indentures governing our senior secured notes and senior notes (which we refer to as the senior secured notes indenture and the senior notes indentures, respectively) contain covenants that restrict our ability to incur debt, as long as we meet these covenants we will be able to incur additional indebtedness.
The February 2023 ransomware attack described above resulted in the unauthorized release of sensitive personal information of certain of our current and former employees that will require remediation expenditures by our company and could adversely affect our reputation and increase the costs we already incur to protect against these risks.
The February 2023 ransomware attack described above resulted in the unauthorized release of sensitive personal information of certain of our current and former employees that has required remediation expenditures by our company and could adversely affect our reputation and increase the costs we already incur to protect against these risks.
For example, our foreign sales are primarily to customers in Canada. Net sales in Canada accounted for approximately 6.4%, 6.5% and 6.4% of our total net sales in fiscal 2022, 2021 and 2020, respectively. Although our sales for export to other countries are generally denominated in U.S. dollars, our sales to Canada are generally denominated in Canadian dollars.
For example, our foreign sales are primarily to customers in Canada. Net sales in Canada accounted for approximately 7.1%, 6.4% and 6.5% of our total net sales in fiscal 2023, 2022 and 2021, respectively. Although our sales for export to other countries are generally denominated in U.S. dollars, our sales to Canada are generally denominated in Canadian dollars.
As of December 31, 2022, we had $619.2 million of goodwill recorded in our consolidated balance sheet. Our testing indicates that the implied fair value of our company is in excess of the carrying value. However, a change in the cash flow assumptions could result in an impairment of goodwill.
As of December 30, 2023, we had $619.4 million of goodwill recorded in our consolidated balance sheet. Our testing indicates that the implied fair value of our company is in excess of the carrying value. However, a change in the cash flow assumptions could result in an impairment of goodwill.
As a result, our adjusted taxable income (used to compute the limitation) decreased and we are subject to the interest expense deduction limitation in fiscal 2022, resulting in an increase to taxable income of $90.2 million. We may continue to be subject to the interest deduction limitation in future years.
As a result, our adjusted taxable income (used to compute the limitation) decreased and we were subject to the interest expense deduction limitation in fiscal 2023 and fiscal 2022, resulting in an increase to taxable income of $107.7 million and $90.2 million, respectively. We may continue to be subject to the interest deduction limitation in future years.
If, prior to the expiration of the collective bargaining agreements for the Cincinnati, Brooklyn or Mexico facilities or prior to the expiration of any of our other existing collective bargaining agreements, we are unable to reach new agreements without union action or any such new agreements are not on terms satisfactory to us, our business, consolidated financial condition, results of operations or liquidity could be materially and adversely affected.
If, prior to the expiration of the collective bargaining agreement for the Terre Haute facility or prior to the expiration of any of our other existing collective bargaining agreements, we are unable to reach new agreements without union action or any such new agreements are not on terms satisfactory to us, our business, consolidated financial condition, results of operations or liquidity could be materially and adversely affected.
While we believe that our relations with our union employees are in general good, we cannot assure you that we will be able to negotiate new collective bargaining agreements for our Cincinnati, Brooklyn or Mexico facilities on terms satisfactory to us, or at all, and without production interruptions, including labor stoppages.
While we believe that our relations with our union employees are in general good, we cannot assure you that we will be able to negotiate a new collective bargaining agreements for our Terre Haute facility on terms satisfactory to us, or at all, and without production interruptions, including labor stoppages.
A prolonged work stoppage or strike at any of our facilities with union employees or a significant work disruption from other labor disputes in the food or related industries could have a material adverse effect on our business, consolidated financial condition, results of operations or liquidity. Four of our collective bargaining agreements expire in the next twelve months.
A prolonged work stoppage or strike at any of our facilities with union employees or a significant work disruption from other labor disputes in the food or related industries could have a material adverse effect on our business, consolidated financial condition, results of operations or liquidity.
We may be unable to maintain our profitability in the face of a consolidating retail environment. Our largest customer, Walmart, accounted for approximately 27.3% of our fiscal 2022 net sales, and our ten largest customers together accounted for approximately 60.5% of our fiscal 2022 net sales.
We may be unable to maintain our profitability in the face of a consolidating retail environment. Our largest customer, Walmart, accounted for approximately 28.8% of our fiscal 2023 net sales, and our ten largest customers together accounted for approximately 60.8% of our fiscal 2023 net sales.
We completed our annual impairment tests for fiscal 2022 and fiscal 2020 with no adjustments to the carrying values of - 27 - Table of Contents indefinite-lived intangible assets.
We completed our annual impairment tests for fiscal 2022 with no adjustments to the carrying values of indefinite-lived intangible assets.
If we were to use working capital or permanent borrowings to fund dividends, we would have less cash and/or borrowing capacity available for future dividends and other purposes, which could negatively impact our financial condition, results of operations, liquidity and ability to maintain or expand our business. - 28 - Table of Contents Our dividend policy may negatively impact our ability to finance capital expenditures, operations or acquisition opportunities.
If we were to use working capital or permanent borrowings to fund dividends, we would have less cash and/or borrowing capacity available for future dividends and other purposes, which could negatively impact our financial condition, results of operations, liquidity and ability to maintain or expand our business.
Our $900.0 million of 5.25% senior notes due 2025 mature on April 1, 2025, our $800.0 million revolving credit facility matures on December 16, 2025, our $610.6 million of tranche B term loans mature on October 10, 2026 and our $550.0 million of 5.25% senior notes due 2027 mature on September 15, 2027.
Our $265.4 million of 5.25% senior notes due 2025 mature on April 1, 2025, our $800.0 million revolving credit facility matures on December 16, 2025, our $528.6 million of tranche B term loans mature on October 10, 2026, our $550.0 million of 5.25% senior notes due 2027 mature on September 15, 2027 and our $550.0 million of 8.00% senior secured notes due 2028 mature on September 15, 2028.
CARES Act on our reported results in fiscal 2023 and beyond may differ from the estimates provided in this report, possibly materially, due to guidance that may be issued and other actions we may take as a result of the new tax law different from that currently contemplated.
Likewise, the ultimate impact of the U.S. Tax Cuts and Jobs Act on our reported results in fiscal 2024 and beyond may differ from the estimates provided in this report, possibly materially, due to guidance that may be issued and other actions we may take as a result of this tax law different from that currently contemplated.
We have substantial indebtedness, which could restrict our ability to pay dividends and impact our financing options and liquidity position. At December 31, 2022, we had total long-term indebtedness of $2,404.1 million (before debt discount/premium), including $954.1 million principal amount of senior secured indebtedness and $1,450.0 million principal amount of senior unsecured indebtedness.
We have substantial indebtedness, which could restrict our ability to pay dividends and impact our financing options and liquidity position. At December 30, 2023, we had total long-term indebtedness of $2,064.0 million (before debt discount/premium), including $1,248.6 million principal amount of senior secured indebtedness and $815.4 million principal amount of senior unsecured indebtedness.
We are able to amortize goodwill and certain intangible assets in accordance with Section 197 of the Internal Revenue Code of 1986. We expect to be able to amortize for tax purposes approximately $1,055.2 million between 2023 and 2037.
We are able to amortize goodwill and certain intangible assets in accordance with Section 197 of the Internal Revenue Code of 1986. We expect to be able to amortize for tax purposes approximately $880.7 million between 2024 and 2038.
We rely on information technology networks and systems, including the Internet, to process, transmit and store electronic and financial information, to manage a variety of business processes and activities, including manufacturing, financial, logistics, sales, marketing and administrative functions. - 24 - Table of Contents We depend on our information technology infrastructure to communicate internally and externally with employees, customers, suppliers and others.
We rely on information technology networks and systems, including the Internet, to process, transmit and store electronic and financial information, to - 24 - Table of Contents manage a variety of business processes and activities, including manufacturing, financial, logistics, sales, marketing and administrative functions.
If operating results for the Static Guard and Molly McButter brands continue to deteriorate, or if operating results for any of our other brands, including newly acquired brands, deteriorate, at rates in excess of our current projections, we may be required to record additional non-cash impairment charges to certain intangible assets.
If future revenues and contributions to our operating results for any of our brands, including newly acquired brands, deteriorate, at rates in excess of our current projections, we may be required to record additional non-cash impairment charges to certain intangible assets.
Our financial well-being could be jeopardized by unforeseen changes in our employees’ collective bargaining agreements, shifts in union policy or labor disruptions in the food industry. As of December 31, 2022, approximately 57.0% of our 3,085 employees were covered by collective bargaining agreements.
Our financial well-being could be jeopardized by unforeseen changes in our employees’ collective bargaining agreements, shifts in union policy or labor disruptions in the food industry. As of December 30, 2023, approximately 53.6% of our 2,912 employees were covered by collective bargaining agreements.
If we issue preferred stock that is senior to our common stock in right of dividend payment, and our cash flows from operating activities or surplus are insufficient to support dividend payments to the holders of preferred stock, on the one hand, and to the holders of common stock, on the other hand, we may be forced to reduce or eliminate dividends to the holders of our common stock.
If we issue preferred stock that is senior to our common stock in right of dividend payment, and our cash flows from operating activities or surplus are insufficient to support dividend payments to the holders of preferred stock, on the one hand, and to the holders of common stock, on the other hand, we may be forced to reduce or eliminate dividends to the holders of our common stock. - 29 - Table of Contents Future sales or the possibility of future sales of a substantial number of shares of our common stock or other securities convertible or exchangeable into common stock may depress the price of our common stock.
Climate change, water scarcity or legal, regulatory, or market measures to address climate change or water scarcity, could negatively affect our business and operations. In the event that climate change has a negative effect on agricultural productivity, we may be subject to decreased availability or less favorable pricing for certain commodities that are necessary for our products.
In the event that climate change has a negative effect on agricultural productivity, we may be subject to decreased availability or less favorable pricing for certain commodities that are necessary for our products.
We measured the assets held for sale at the lower of their carrying value or fair value less anticipated costs to sell and recorded pre-tax, non-cash impairment charges of $106.4 million during fiscal 2022 relating to those assets.
We measured the assets held for sale at the lower of their carrying value or fair value less anticipated costs to sell and recorded pre-tax, non-cash impairment charges of $106.4 million during fiscal 2022 relating to those assets. See Note 3, “Acquisitions and Divestitures” to our consolidated financial statements in Part II, Item 8 of this report.
However, we may be unable to identify and consummate additional acquisitions or may be unable to successfully integrate and manage the product lines or businesses that we have recently acquired or may acquire in the future.
A major part of our strategy is to grow through acquisitions and we expect to pursue additional acquisitions of food product lines and businesses. However, we may be unable to identify and consummate additional acquisitions or may be unable to successfully integrate and manage the product lines or businesses that we have recently acquired or may acquire in the future.
A breach of any of these covenants, or failure to meet or maintain ratios or tests could result in a default under our credit agreement and/or our senior notes indentures. Certain events of default under our credit agreement and our senior notes indentures would prohibit us from paying dividends on our common stock.
A breach of any of these covenants, or failure to meet or maintain ratios or tests could result in a default under our credit agreement and/or our senior secured notes indenture and/or our senior notes indentures.
Our total assets include substantial goodwill and indefinite-lived intangible assets (trademarks). These assets are tested for impairment through qualitative and quantitative assessments at least annually and whenever events or circumstances occur indicating that goodwill or indefinite-lived intangible assets might be impaired.
These assets are tested for impairment through qualitative and quantitative assessments at least annually and whenever events or circumstances occur indicating that goodwill or indefinite-lived intangible assets might be impaired. We test our goodwill and indefinite-lived intangible assets by comparing the fair values with the carrying values and recognize a loss for the difference.
Beginning with fiscal 2022, our adjusted taxable income as computed for purposes of the interest expense deduction limitation is computed after any deduction allowable for depreciation and amortization.
If we are unable to fully utilize our interest expense deductions in future periods, our cash taxes will increase. Beginning with fiscal 2022, our adjusted taxable income as computed for purposes of the interest expense deduction limitation is computed after any deduction allowable for depreciation and amortization.
We have recorded a deferred tax asset of $22.2 million related to the interest deduction carryover, without a valuation allowance, as the disallowed interest may be carried forward indefinitely. The increase in our cash taxes resulting from the interest expense deduction limitation is approximately $20.6 million for fiscal 2022.
We have recorded a deferred tax asset of $46.9 million and $22.2 million for fiscal 2023 and fiscal 2022, respectively, related to the interest deduction carryover, without a valuation allowance, as the disallowed interest may be carried forward indefinitely.
See Note 10, “Income Taxes,” to our consolidated financial statements in Part II, Item 8 of this report for information about the U.S. Tax Cuts and Jobs Act and the U.S. CARES Act. A change in the assumptions used to value our goodwill or our indefinite-lived intangible assets could negatively affect our consolidated results of operations and net worth.
See Note 10, “Income Taxes,” to our consolidated financial statements in Part II, Item 8 of this report for information about the U.S. Tax Cuts and Jobs Act.
We also use information technology networks and systems to comply with regulatory, legal and tax requirements.
We depend on our information technology infrastructure to communicate internally and externally with employees, customers, suppliers and others. We also use information technology networks and systems to comply with regulatory, legal and tax requirements.
See Note 3, “Acquisitions and Divestitures” and Note 18, “Subsequent Events” to our consolidated financial statements in Part II, Item 8 of this report.
See Note 10, “Income Taxes,” to our consolidated financial statements in Part II, Item 8 of this report.
The expected annual deductions are approximately $122.9 million for each year fiscal 2023 through fiscal 2024, approximately $122.6 million for fiscal 2025, approximately $118.7 million for fiscal 2026, approximately $98.8 million for fiscal 2027, approximately $96.3 million for fiscal 2028, approximately $95.7 million for fiscal 2029, approximately $89.6 million for fiscal 2030, approximately $56.9 million for fiscal 2031, approximately $38.7 million - 26 - Table of Contents for fiscal 2032, approximately $33.8 million for fiscal 2033, approximately $30.4 million for fiscal 2034, approximately $26.7 million for fiscal 2035, approximately $1.0 million for fiscal 2036 and approximately $0.3 million for fiscal 2037.
The expected annual deductions are approximately $116.0 million for each year fiscal 2024 through fiscal 2025, approximately $111.8 million for fiscal 2026, approximately $92.1 million for fiscal 2027, approximately $90.6 million for fiscal 2028, approximately $90.4 million for fiscal 2029, approximately $84.3 million for fiscal 2030, approximately $51.6 million for fiscal 2031, approximately $34.8 million for fiscal 2032, approximately $34.0 million for fiscal 2033, approximately $30.6 million for fiscal 2034, approximately $27.0 million for fiscal 2035, approximately $1.2 million for fiscal 2036, approximately $0.6 million for fiscal 2037 and approximately $0.1 million for fiscal 2038.
Competing manufacturers can be affected differently by weather conditions, natural disasters and other natural events depending on the location of their supplies. If our supplies of raw materials are delayed or reduced, we may not be able to find supplemental supply sources on favorable terms or at all, which could adversely affect our business and operating results.
If our supplies of raw materials are delayed or reduced, we may not be able to find supplemental supply sources on favorable terms or at all, which could adversely affect our business and operating results. Climate change, water scarcity or legal, regulatory, or market measures to address climate change or water scarcity, could negatively affect our business and operations.
We may need to increase or reallocate spending on existing and new distribution channels and technologies, marketing, advertising and new product innovation to protect or increase revenues, market share and brand significance. These expenditures may not be successful, including those related to our e-commerce and other technology-focused efforts, and might not result in trade and consumer acceptance of our efforts.
These expenditures may not be successful, including those related to our e-commerce and other technology-focused efforts, and might not result in trade and consumer acceptance of our efforts.
Future changes that increase cash taxes payable by us could significantly decrease our future cash flow available to make interest and dividend payments with respect to our securities and have a material adverse effect on our business, consolidated financial condition, results of operations and liquidity.
Unexpected results from one or more such tax audits could significantly adversely affect our effective rate and increase our cash taxes payable, which could significantly reduce our future cash and impact our ability to make interest and dividend payments and have a material adverse effect on our business, consolidated financial condition, results of operations and liquidity.
The continuing effects of the COVID-19 pandemic or any future pandemics or disease outbreaks may cause significant disruptions to our supply chain and operations, including disruptions in our ability to purchase raw materials, and delays in the manufacture and shipment of our products.
Pandemics or disease outbreaks may cause significant disruptions to our supply chain and operations, including disruptions in our ability to purchase raw materials, and delays in the manufacture and shipment of our products. Competing manufacturers can be affected differently by weather conditions, natural disasters and other natural events depending on the location of their supplies.
There are various factors that may cause tax assumptions to change in the future, and we may have to record a valuation allowance against these deferred tax assets. See Note 10, “Income Taxes,” to our consolidated financial statements in Part II, Item 8 of this report.
The increase in our cash taxes resulting from the interest expense deduction limitation was approximately $25.0 million and $20.6 million for fiscal 2023 and 2022, respectively. There are various factors that may cause tax assumptions to change in the future, and we may have to record a valuation allowance against these deferred tax assets.
The collective bargaining agreement covering our Cincinnati facility, which covers approximately 125 employees, is scheduled to expire on April 30, 2023, and the collective bargaining agreement covering our Brooklyn facility, which covers approximately 53 employees, is scheduled to expire on December 31, 2023.
We expect the new agreement will be ratified by the union employees at our Brooklyn facility in early March 2024. In addition, one of our collective bargaining agreements expires in the next twelve months. The collective bargaining agreement covering our Terre Haute facility, which covers approximately 111 employees, is scheduled to expire on March 30, 2024.
Removed
A major part of our strategy is to grow through acquisitions. For example, we completed the Yuma acquisition in May 2022 and we completed the Crisco acquisition in December 2020 and we expect to pursue additional acquisitions of food product lines and businesses.
Added
We may need to increase or reallocate spending on existing and new distribution channels and technologies, marketing, advertising and new product innovation to protect or - 16 - Table of Contents increase revenues, market share and brand significance.
Removed
In addition, under the new Mexican labor law, we are required to negotiate a new collective bargaining agreement for our Mexico facility to replace the existing collective bargaining agreements, which cover approximately 1,045 employees. The new collective bargaining agreement for our Mexico facility must be subjected to a vote of the union employees by May 1, 2023.
Added
Certain events of default under our credit agreement, our senior secured notes indenture and our senior notes indentures would prohibit us from paying dividends on our common stock.
Removed
On March 27, 2020, the Coronavirus Aid, Relief and Economic Security Act, which we refer to as the “U.S. CARES Act,” was signed into law. The U.S. CARES Act, among other things, includes provisions related to net operating loss carryback periods, modifications to the interest deduction limitation and technical corrections to tax depreciation for qualified improvement property. The U.S.
Added
The collective bargaining agreement covering employees at our Brooklyn, New York facility, which covers approximately 41 employees, expired on December 31, 2023. During February 2024, we reached an agreement in principle with the United Food and Commercial Workers Union, Local No. 342, to extend the collective bargaining agreement for an additional four-year period ending December 21, 2027.
Removed
CARES Act increased the adjusted taxable income limitation from 30% to 50% for business interest deductions for tax years 2019 and 2020 and the limitation reverted back to 30% beginning in 2021. See Note 10, “Income Taxes,” to our consolidated financial statements in Part II, Item 8 of this report.
Added
Other changes in tax laws in the United States or in other countries where we have significant operations, including rate changes or corporate tax provisions that could disallow or tax perceived base erosion or profit shifting payments or subject us to new types of tax, could have a material adverse effect on our effective tax rate and our deferred tax assets and liabilities.
Removed
If we are unable to fully utilize our interest expense deductions in future periods, our cash taxes will increase. We were not subject to an interest expense deduction limitation in fiscal 2020 but were subject to the limitation in fiscal 2021, which increased our taxable income by $6.7 million.
Added
In addition, aspects of U.S. tax laws may lead foreign jurisdictions to respond by enacting additional tax legislation that is unfavorable to us.
Removed
Likewise, the ultimate impact of the U.S. Tax Cuts and Jobs Act and the U.S.
Added
For example, numerous countries have now enacted the Organization of Economic Cooperation and Development’s model rules on a global minimum tax of 15%, with the earliest effective date being for taxable years beginning as early as 2024 and with widespread implementation of a global minimum tax expected by 2025.
Removed
We test our goodwill and indefinite-lived intangible assets by comparing the fair values with the carrying values and recognize a loss for the difference.
Added
This increasingly complex global tax environment has in the past and could continue to increase tax uncertainty, resulting in higher compliance costs. Based on the guidance available thus far, we do not expect this legislation to have a material impact on our consolidated financial statements, but we will continue to evaluate it as additional guidance and clarification becomes available.
Removed
For example, beginning with the dividend payment declared on November 8, 2022 and paid on January 30, 2023, the current intended dividend rate for our common stock was reduced from $1.90 per share per annum to $0.76 per share per annum.
Added
We are also subject to tax audits by governmental authorities. Although we believe our tax estimates are reasonable, if a taxing authority disagrees with the positions we have taken, we could face additional tax liabilities, - 27 - Table of Contents including interest and penalties.
Removed
Future sales or the possibility of future sales of a substantial number of shares of our common stock or other securities convertible or exchangeable into common stock may depress the price of our common stock.
Added
A change in the assumptions used to value our goodwill or our indefinite-lived intangible assets could negatively affect our consolidated results of operations and net worth. Our total assets include substantial goodwill and indefinite-lived intangible assets (trademarks).
Added
Our annual impairment tests for fiscal 2023 resulted in our company recording pre-tax, non-cash impairment charges to intangible trademark assets for our Baker’s Joy , Molly McButter , Sugar Twin and New York Flatbreads brands of $20.5 million in the aggregate during the fourth quarter of 2023, which is recorded in “Impairment of intangible assets” in our consolidated statement of operations for fiscal 2023.
Added
We partially impaired the Baker’s Joy and Sugar Twin brands, and we fully impaired the Molly McButter and New York Flatbreads brands.
Added
Additionally, in connection with the divestiture of our Green Giant U.S. shelf-stable product line during the fourth quarter of 2023, we reclassified $115.3 million of indefinite-lived trademark intangible assets, $82.3 million of inventories and $4.1 million of finite-lived customer relationship intangible assets to assets held for sale as of the end of the third quarter of 2023.
Added
We then measured the assets held for sale at the lower of their carrying value or fair value less the estimated costs to sell, and recorded pre-tax, non-cash charges of $132.9 million during the third quarter of 2023.
Added
During the fourth quarter of 2023, we completed the Green Giant U.S. shelf-stable divestiture and recorded a loss on sale of $4.8 million during the quarter, resulting in a total loss on sale of $137.7 million during fiscal 2023. See Note 3, “Acquisitions and Divestitures” to our consolidated financial statements in Part II, Item 8 of this report.
Added
Our dividend policy may negatively impact our ability to finance capital expenditures, operations or acquisition opportunities.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

1 edited+0 added−0 removed0 unchanged
Biggest changeItem 3. Legal Proceedings. The information set forth under the heading “ Legal Proceedings” in Note 14 of Notes to Consolidated Financial Statements in Part II, Item 8 of this Annual Report on Form 10-K is incorporated herein by reference. Item 4. Mine Safety Disclosures. Not applicable. - 30 - Table of Contents PART II
Biggest changeItem 3. Legal Proceedings. The information set forth under the heading “ Legal Proceedings” in Note 14 of Notes to Consolidated Financial Statements in Part II, Item 8 of this Annual Report on Form 10-K is incorporated herein by reference. Item 4. Mine Safety Disclosures. Not applicable. - 32 - Table of Contents PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

13 edited+0 added−1 removed13 unchanged
Biggest changeIn general, our senior notes indentures restrict our ability to declare and pay dividends on our common stock as follows: ● we may use up to 100% of our excess cash (as defined below) for the period (taken as one accounting period) from and including March 31, 2013 to the end of our most recent fiscal quarter for which internal - 32 - Table of Contents financial statements are available at the time of such payments, plus certain incremental funds described in the indentures for the payment of dividends so long as the fixed charge coverage ratio for the four most recent fiscal quarters for which internal financial statements are available is not less than 1.6 to 1.0; and ● we may not pay any dividends on any dividend payment date if a default or event of default under our indentures has occurred or is continuing.
Biggest changeIn general, our senior secured notes indenture and senior notes indentures restrict our ability to declare and pay dividends on our common stock as follows: ● under our senior secured notes indenture, we may use up to $600 million plus 100% of our excess cash (as defined below) for the period (taken as one accounting period) from and including July 1, 2023 to the end of our most recent fiscal quarter for which internal financial statements are available at the time of such payments, plus certain incremental funds described in the senior secured notes indenture for the payment of dividends so long as the fixed charge coverage ratio for the four most recent fiscal quarters for which internal financial statements are available is not less than 1.6 to 1.0; - 34 - Table of Contents ● under our senior notes indentures, we may use up to 100% of our excess cash (as defined below) for the period (taken as one accounting period) from and including March 31, 2013 to the end of our most recent fiscal quarter for which internal financial statements are available at the time of such payments, plus certain incremental funds described in the senior notes indentures for the payment of dividends so long as the fixed charge coverage ratio for the four most recent fiscal quarters for which internal financial statements are available is not less than 1.6 to 1.0; and ● we may not pay any dividends on any dividend payment date if a default or event of default under our senior secured notes indenture or senior notes indentures has occurred or is continuing.
The following table sets forth the dividends per share we have declared in each of the quarterly periods of 2022 and 2021: ​ ​ ​ ​ ​ ​ ​ ​ Fiscal 2022 Fiscal 2021 Fourth Quarter ​ $ 0.190 ​ $ 0.475 Third Quarter ​ $ 0.475 ​ $ 0.475 Second Quarter ​ $ 0.475 ​ $ 0.475 First Quarter ​ $ 0.475 ​ $ 0.475 Under U.S. federal income tax law, distributions to holders of our common stock are taxable to the extent they are paid out of current or accumulated earnings and profits.
The following table sets forth the dividends per share we have declared in each of the quarterly periods of 2023 and 2022: ​ ​ ​ ​ ​ ​ ​ ​ Fiscal 2023 Fiscal 2022 Fourth Quarter ​ $ 0.190 ​ $ 0.190 Third Quarter ​ $ 0.190 ​ $ 0.475 Second Quarter ​ $ 0.190 ​ $ 0.475 First Quarter ​ $ 0.190 ​ $ 0.475 Under U.S. federal income tax law, distributions to holders of our common stock are taxable to the extent they are paid out of current or accumulated earnings and profits.
Indexes calculated on month-end basis. - 31 - Table of Contents Dividend Policy General Our dividend policy reflects a basic judgment that our stockholders are better served when we distribute a substantial portion of our cash available to pay dividends to them instead of retaining it in our business.
Indexes calculated on month-end basis. - 33 - Table of Contents Dividend Policy General Our dividend policy reflects a basic judgment that our stockholders are better served when we distribute a substantial portion of our cash available to pay dividends to them instead of retaining it in our business.
In addition, our credit agreement does not permit us to pay dividends unless we maintain: ● a “consolidated interest coverage ratio” (defined as the ratio on a pro forma basis of our adjusted EBITDA before share-based compensation for any period of four consecutive fiscal quarters to our consolidated interest expense for such period payable in cash) of not less than 1.75 to 1.00; and ● a “consolidated leverage ratio” (defined as the ratio on a pro forma basis of our consolidated net debt, as of the last day of any period of four consecutive fiscal quarters to our adjusted EBITDA before share-based compensation for such period) of not more than 8.00 to 1.00 for the quarter ended October 1, 2022 through the quarter ending September 30, 2023; 7.50 to 1.00 for the quarter ending December 30, 2023; and 7.00 to 1.00 for the quarters ending March 30, 2024 and thereafter.
In addition, our credit agreement does not permit us to pay dividends unless we maintain: ● a “consolidated interest coverage ratio” (defined as the ratio on a pro forma basis of our adjusted EBITDA before share-based compensation for any period of four consecutive fiscal quarters to our consolidated interest expense for such period payable in cash) of not less than 1.75 to 1.00; and ● a “consolidated leverage ratio” (defined as the ratio on a pro forma basis of our consolidated net debt, as of the last day of any period of four consecutive fiscal quarters to our adjusted EBITDA before share-based compensation for such period) of not more than 7.50 to 1.00 for the quarter ended December 30, 2023, and 7.00 to 1.00 for the quarters ending March 30, 2024 and thereafter.
Common Stock, the Russell 2000 Index and the S&P Packaged Foods & Meats Index ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 12/30/2017 * 12/29/2018 12/28/2019 1/2/2021 1/1/2022 12/31/2022 B&G Foods, Inc.
Common Stock, the Russell 2000 Index and the S&P Packaged Foods & Meats Index ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 12/29/2018 * 12/28/2019 1/2/2021 1/1/2022 12/31/2022 12/30/2023 B&G Foods, Inc.
Excess cash is defined in our senior notes indentures and under the terms of our credit agreement.
Excess cash is defined in our senior secured notes indenture, senior notes indentures and under the terms of our credit agreement.
Performance Graph Set forth below is a line graph comparing the change in the cumulative total shareholder return on our company’s common stock with the cumulative total return of the Russell 2000 Index and the S&P Packaged Foods & Meats Index for the period from December 30, 2017 to December 31, 2022, assuming the investment of $100 on December 30, 2017 and the reinvestment of dividends.
Performance Graph Set forth below is a line graph comparing the change in the cumulative total shareholder return on our company’s common stock with the cumulative total return of the Russell 2000 Index and the S&P Packaged Foods & Meats Index for the period from December 29, 2018 to December 30, 2023, assuming the investment of $100 on December 29, 2018 and the reinvestment of dividends.
Based on U.S. federal income tax laws, B&G Foods has determined that for fiscal 2022 and fiscal 2021, 100.0% and approximately 83.0%, respectively, of distributions paid on common stock were treated as a return of capital and 0.0% and approximately 17.0%, respectively, were treated as a taxable dividend paid from earnings and profits.
Based on U.S. federal income tax laws, B&G Foods has determined that for fiscal 2023 and fiscal 2022, 100.0% of distributions paid on common stock were treated as a return of capital and 0.0% were treated as a taxable dividend paid from earnings and profits.
Based on our current intended dividend rate of $0.76 per share per annum and our current number of shares outstanding, we expect our aggregate dividend payments in 2023 to be approximately $54.5 million.
Based on our current intended dividend rate of $0.76 per share per annum and our current number of shares outstanding, we expect our aggregate dividend payments in 2024 to be approximately $60.0 million.
According to the records of our transfer agent, we had 489 holders of record of our common stock as of February 23, 2023, including Cede & Co. as nominee for The Depository Trust Company (DTC).
According to the records of our transfer agent, we had 471 holders of record of our common stock as of February 22, 2024, including Cede & Co. as nominee for The Depository Trust Company (DTC).
We have paid dividends every quarter since our initial public offering in October 2004. For fiscal 2022 and fiscal 2021, we had cash flows from operating activities of $6.0 million and $93.9 million, respectively, and distributed $133.4 million and $122.9 million as dividends, respectively.
We have paid dividends every quarter since our initial public offering in October 2004. For fiscal 2023 and fiscal 2022, we had cash flows from operating activities of $247.8 million and $6.0 million, respectively, and distributed $56.0 million and $133.4 million as dividends, respectively.
Recent Sales of Unregistered Securities We did not issue any unregistered securities in fiscal 2022. Issuer Purchases of Equity Securities Not applicable. ​ Item 6. [Reserved] - 33 - Table of Contents
Recent Sales of Unregistered Equity Securities We did not issue any unregistered equity securities in fiscal 2023. Issuer Purchases of Equity Securities Not applicable. ​ Item 6. [Reserved] ​
(NYSE: BGS) ​ $ 100.00 ​ 91.10 ​ 59.20 ​ 100.32 ​ 118.02 ​ 46.50 Russell 2000 Index ​ $ 100.00 ​ 88.99 ​ 111.70 ​ 134.00 ​ 153.85 ​ 122.41 S&P Packaged Foods & Meats Index ​ $ 100.00 ​ 81.20 ​ 106.23 ​ 111.04 ​ 125.56 ​ 137.34 * $100 invested on December 30, 2017 in B&G Foods’ common stock or index, including reinvestment of dividends.
(NYSE: BGS) ​ $ 100.00 ​ 64.99 ​ 110.12 ​ 129.55 ​ 51.05 ​ 51.19 ​ Russell 2000 Index ​ $ 100.00 ​ 125.52 ​ 150.58 ​ 172.90 ​ 137.56 ​ 160.85 ​ S&P Packaged Foods & Meats Index ​ $ 100.00 ​ 130.82 ​ 136.75 ​ 154.64 ​ 169.14 ​ 156.37 ​ * $100 invested on December 29, 2018 in B&G Foods’ common stock or index, including reinvestment of dividends.
Removed
Beginning with the dividend payment declared on November 8, 2022 and paid on January 30, 2023, the current intended dividend rate for our common stock was reduced from $1.90 per share per annum to $0.76 per share per annum.

Item 6. [Reserved]

Selected Financial Data — reserved (removed by SEC in 2021)

1 edited+0 added−0 removed0 unchanged
Biggest changeItem 6. ​ [ Reserved] ​ 33 Item 7. ​ Management’s Discussion and Analysis of Financial Condition and Results of Operations ​ 34 Item 7A. ​ Quantitative and Qualitative Disclosures About Market Risk ​ 50 Item 8. ​ Financial Statements and Supplementary Data ​ 52
Biggest changeItem 6. ​ [ Reserved] ​ 35 Item 7. ​ Management’s Discussion and Analysis of Financial Condition and Results of Operations ​ 35 Item 7A. ​ Quantitative and Qualitative Disclosures About Market Risk ​ 52 Item 8. ​ Financial Statements and Supplementary Data ​ 54

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

120 edited+42 added−34 removed69 unchanged
Biggest changeReconciliations of net (loss) income and net cash provided by operating activities to EBITDA and adjusted EBITDA for fiscal 2022 and fiscal 2021 along with the components of EBITDA and adjusted EBITDA follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ Fiscal 2022 Fiscal 2021 Net (loss) income ​ $ (11,370) ​ $ 67,363 Income tax (benefit) expense ​ ​ (7,537) ​ ​ 26,291 Interest expense, net ​ ​ 124,915 ​ ​ 106,889 Depreciation and amortization ​ ​ 80,528 ​ ​ 82,888 EBITDA ​ ​ 186,536 ​ ​ 283,431 Acquisition/divestiture-related and non-recurring expenses (1) ​ ​ 12,921 ​ ​ 32,504 Gain on sales of assets, net of facility closure costs (2) ​ ​ (4,928) ​ ​ — Amortization of acquisition-related inventory step-up (3) ​ ​ — ​ ​ 5,054 Accrual for multi-employer pension plan withdrawal liability (4) ​ ​ — ​ ​ 13,907 Impairment of assets held for sale (5) ​ ​ 106,434 ​ ​ — Impairment of intangible assets (6) ​ ​ — ​ ​ 23,088 Adjusted EBITDA ​ $ 300,963 ​ $ 357,984 ​ - 42 - Table of Contents ​ ​ ​ ​ ​ ​ ​ ​ Fiscal 2022 Fiscal 2021 Net cash provided by operating activities ​ $ 5,963 ​ $ 93,878 Income tax (benefit) expense ​ ​ (7,537) ​ ​ 26,291 Interest expense, net ​ ​ 124,915 ​ ​ 106,889 Net gain/(loss) on sales and disposals of property, plant and equipment ​ ​ 7,086 ​ ​ (775) Deferred income taxes ​ ​ 26,897 ​ ​ (7,269) Amortization of deferred debt financing costs and bond discount/premium ​ ​ (4,723) ​ ​ (4,606) Share-based compensation expense ​ ​ (3,917) ​ ​ (5,383) Changes in assets and liabilities, net of effects of business combinations ​ ​ 144,286 ​ ​ 97,494 Impairment of assets held for sale (5) ​ ​ (106,434) ​ ​ — Impairment of intangible assets (6) ​ ​ — ​ ​ (23,088) EBITDA ​ ​ 186,536 ​ ​ 283,431 Acquisition/divestiture-related and non-recurring expenses (1) ​ ​ 12,921 ​ ​ 32,504 Gain on sales of assets, net of facility closure costs (2) ​ ​ (4,928) ​ ​ — Amortization of acquisition-related inventory step-up (3) ​ ​ — ​ ​ 5,054 Accrual for multi-employer pension plan withdrawal liability (4) ​ ​ — ​ ​ 13,907 Impairment of assets held for sale (5) ​ ​ 106,434 ​ ​ — Impairment of intangible assets (6) ​ ​ — ​ ​ 23,088 Adjusted EBITDA ​ $ 300,963 ​ $ 357,984 ​ Adjusted Net Income and Adjusted Diluted Earnings Per Share.
Biggest changeReconciliations of net loss and net cash provided by operating activities to EBITDA and adjusted EBITDA for fiscal 2023 and fiscal 2022 along with the components of EBITDA and adjusted EBITDA follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ Fiscal 2023 Fiscal 2022 Net loss ​ $ (66,198) ​ $ (11,370) Income tax benefit ​ ​ (935) ​ ​ (7,537) Interest expense, net (1) ​ ​ 151,333 ​ ​ 124,915 Depreciation and amortization ​ ​ 69,620 ​ ​ 80,528 EBITDA ​ ​ 153,820 ​ ​ 186,536 Acquisition/divestiture-related and non-recurring expenses (2) ​ ​ 5,877 ​ ​ 12,921 Loss (gain) on sales of assets, net of facility closure costs (3) ​ ​ 137,798 ​ ​ (4,928) Impairment of assets held for sale (4) ​ ​ — ​ ​ 106,434 Impairment of intangible assets (5) ​ ​ 20,500 ​ ​ — Adjusted EBITDA ​ $ 317,995 ​ $ 300,963 ​ ​ ​ ​ ​ ​ ​ ​ ​ Fiscal 2023 Fiscal 2022 Net cash provided by operating activities ​ $ 247,759 ​ $ 5,963 Income tax benefit ​ ​ (935) ​ ​ (7,537) Interest expense, net (1) ​ ​ 151,333 ​ ​ 124,915 Gain on extinguishment of debt (1) ​ ​ 911 ​ ​ — (Loss) gain on sales of assets (3) ​ ​ (138,523) ​ ​ 7,086 Deferred income taxes ​ ​ 26,395 ​ ​ 26,897 Amortization of deferred debt financing costs and bond discount/premium ​ ​ (7,510) ​ ​ (4,723) Share-based compensation expense ​ ​ (7,191) ​ ​ (3,917) Changes in assets and liabilities, net of effects of business combinations ​ ​ (97,919) ​ ​ 144,286 Impairment of assets held for sale (4) ​ ​ — ​ ​ (106,434) Impairment of intangible assets (5) ​ ​ (20,500) ​ ​ — EBITDA ​ ​ 153,820 ​ ​ 186,536 Acquisition/divestiture-related and non-recurring expenses (2) ​ ​ 5,877 ​ ​ 12,921 Loss (gain) on sales of assets, net of facility closure costs (3) ​ ​ 137,798 ​ ​ (4,928) Impairment of assets held for sale (4) ​ ​ — ​ ​ 106,434 Impairment of intangible assets (5) ​ ​ 20,500 ​ ​ — Adjusted EBITDA ​ $ 317,995 ​ $ 300,963 ​ Adjusted Net Income and Adjusted Diluted Earnings Per Share.
Goodwill and Other Intangible Assets Our total assets include substantial goodwill and indefinite-lived intangible assets (trademarks). Goodwill and indefinite-lived intangible assets and goodwill are not amortized. As a result, these assets are tested for impairment through qualitative and quantitative assessments at least annually and whenever events or circumstances occur indicating that goodwill or indefinite-lived intangible assets might be impaired.
Goodwill and Other Intangible Assets Our total assets include substantial goodwill and indefinite-lived intangible assets (trademarks). Goodwill and indefinite-lived intangible assets are not amortized. As a result, these assets are tested for impairment through qualitative and quantitative assessments at least annually and whenever events or circumstances occur indicating that goodwill or indefinite-lived intangible assets might be impaired.
A non-GAAP financial measure is defined as a numerical measure of our financial performance that excludes or includes amounts so as to be different from the most directly comparable measure calculated and presented in accordance with GAAP in our consolidated balance sheets and related consolidated statements of operations, comprehensive income, changes in stockholders’ equity and cash flows.
A non-GAAP financial measure is defined as a numerical measure of our financial performance that excludes or includes amounts so as to be different from the most directly comparable measure calculated and presented in accordance with GAAP in our consolidated balance sheets and related consolidated statements of operations, comprehensive (loss) income, changes in stockholders’ equity and cash flows.
In addition, our annual impairment tests for fiscal 2021 resulted in our company recording non-cash impairment charges to intangible trademark assets for the SnackWell’s , Static Guard , Molly McButter and Farmwise brands of $23.1 million in the aggregate during the fourth quarter of fiscal 2021, which is recorded in “Impairment of intangible assets” in the accompanying consolidated statement of operations for fiscal 2021.
Our annual impairment tests for fiscal 2021 resulted in our company recording non-cash impairment charges to intangible trademark assets for the SnackWell’s , Static Guard , Molly McButter and Farmwise brands of $23.1 million in the aggregate during the fourth quarter of fiscal 2021, which is recorded in “Impairment of intangible assets” in the accompanying consolidated statement of operations for fiscal 2021.
(5) In connection with our decision to sell our Back to Nature business, we reclassified $109.9 million of indefinite-lived trademark intangible assets, $29.5 million of goodwill, $11.0 million of finite-lived customer relationship intangible assets and $7.3 million of inventories to assets held for sale during fiscal 2022.
(4) In connection with our decision to sell our Back to Nature business, we reclassified $109.9 million of indefinite-lived trademark intangible assets, $29.5 million of goodwill, $11.0 million of finite-lived customer relationship intangible assets and $7.3 million of inventories to assets held for sale during fiscal 2022.
To the extent we are unable to avoid or offset any present or future cost increases by locking in our costs, implementing cost saving measures or increasing prices to our customers, our operating results could be materially adversely affected.
However, to the extent we are unable to avoid or offset any present or future cost increases by locking in our costs, implementing cost saving measures or increasing prices to our customers, our operating results could be materially adversely affected.
Because we cannot predict the timing and amount of these items, management does not consider these items when evaluating our company’s performance or when making decisions regarding allocation of resources.
Because we cannot predict the timing and amount of these items, management does not consider these items when evaluating our performance or when making decisions regarding allocation of resources.
Accordingly, for significant items, we typically obtain assistance from third-party valuation specialists. Determining the useful life of an intangible asset also requires judgment as different types of intangible assets will have different useful lives and certain assets may even be considered to have indefinite useful lives. All of these judgments and estimates can materially impact our results of operations.
Accordingly, for significant items, we typically obtain assistance from third-party valuation specialists. Determining the useful life of an intangible asset also requires judgment as different types of intangible assets will have different useful lives and certain assets may even be considered to have indefinite useful lives. All of these judgments and estimates can materially impact our results of operations. U.S.
Dividend Policy For a discussion of our dividend policy, see the information set forth under the heading “Dividend Policy” in Part II, Item 5 of this report. - 47 - Table of Contents Acquisitions Our liquidity and capital resources have been significantly impacted by acquisitions and may be impacted in the foreseeable future by additional acquisitions.
Dividend Policy For a discussion of our dividend policy, see the information set forth under the heading “Dividend Policy” in Part II, Item 5 of this report. - 49 - Table of Contents Acquisitions Our liquidity and capital resources have been significantly impacted by acquisitions and may be impacted in the foreseeable future by additional acquisitions.
Debt See Note 7, “Long-Term Debt,” to our consolidated financial statements in Part II, Item 8 of this report for a description of our senior secured credit agreement, including our revolving credit facility and tranche B term loans, our 5.25% senior notes due 2025, and our 5.25% senior notes due 2027.
Debt See Note 7, “Long-Term Debt,” to our consolidated financial statements in Part II, Item 8 of this report for a description of our senior secured credit agreement, including our revolving credit facility and tranche B term loans, our 5.25% senior notes due 2025, our 5.25% senior notes due 2027 and our 8.00% senior secured notes due 2028.
Other income for fiscal 2022 primarily includes the non-service portion of net periodic pension cost and net periodic post-retirement benefit costs of $7.4 million and the remeasurement of monetary assets denominated in a foreign currency into U.S. dollars of less than $0.1 million.
Other income for fiscal 2022 includes the non-service portion of net periodic pension cost and net periodic post-retirement benefit costs of $7.4 million and the remeasurement of monetary assets denominated in a foreign currency into U.S. dollars of less than $0.1 million. Income Tax Benefit.
We expect to make capital expenditures of approximately $35.0 million to $40.0 million in the aggregate during fiscal 2023. Our projected capital expenditures for fiscal 2023 primarily relate to asset sustainability projects, cost savings initiatives, environmental compliance and information technology systems (hardware and software), including cybersecurity.
We expect to make capital expenditures of approximately $35.0 million to $40.0 million in the aggregate during fiscal 2024. Our projected capital expenditures for fiscal 2024 primarily relate to asset sustainability projects, cost savings initiatives, environmental compliance and information technology systems (hardware and software), including cybersecurity.
Significant management judgment is necessary to estimate the impact of competitive operating, macroeconomic and other factors to estimate the future levels of sales and cash flows. We completed our annual impairment tests for fiscal 2022, fiscal 2021 and fiscal 2020 with no adjustments to the carrying values of goodwill.
Significant management judgment is necessary to estimate the impact of competitive operating, macroeconomic and other factors to estimate the future levels of sales and cash flows. We completed our annual impairment tests for fiscal 2023, fiscal 2022 and fiscal 2021 with no adjustments to the carrying values of goodwill.
During the third quarter of 2022, we measured the assets held for sale at the lower of their carrying value or fair value less anticipated costs to sell and recorded pre-tax, non-cash impairment charges of $103.6 million (or $78.2 million, net of tax), and during the fourth quarter of 2022, we recorded an additional $2.8 million (or $2.1 million, net of tax) of pre-tax, non-cash impairment charges related to those assets after we entered into an agreement to sell the Back to Nature business on December 15, 2022.
During the third quarter of 2022, we measured the assets held for sale at the lower of their carrying value or fair value less anticipated costs to sell and recorded pre-tax, non-cash impairment charges of $103.6 million (or $78.2 million, net of tax), and during the fourth quarter of 2022, we recorded an additional $2.8 million (or $2.1 million, net of tax) of pre-tax, non-cash impairment charges related to those assets after we entered into an agreement to sell the Back to Nature business.
We recognize the benefit of an uncertain tax position that we have taken or expect to take on the income tax returns if it is more likely than not that such tax position will be sustained based upon its technical merits. See “U.S. Tax Act and U.S. CARES Act” below for a discussion of the U.S.
We recognize the benefit of an uncertain tax position that we have taken or expect to take on the income tax returns if it is more likely than not that such tax position will be sustained based upon its technical merits. See “U.S. Tax Act” below for a discussion of the U.S.
Changes in interest rates and the market value of the securities held by the plans could materially change, positively or negatively, the funded status of the plans and affect the level of pension expense and required contributions in fiscal 2023 and beyond.
Changes in interest rates and the market value of the securities held by the plans could materially change, positively or negatively, the funded status of the plans and affect the level of pension expense and required contributions in fiscal 2024 and beyond.
We define adjusted EBITDA as EBITDA adjusted for cash and non-cash acquisition/divestiture-related expenses, gains and losses (which may include third-party fees and expenses, integration, restructuring and consolidation expenses, amortization of acquired inventory fair value step-up, and gains and losses on the sale of certain assets); loss on extinguishment of debt; impairment of assets held for sale; intangible asset impairment charges; and non-recurring expenses, gains and losses.
We define adjusted EBITDA as EBITDA adjusted for cash and non-cash acquisition/divestiture-related expenses, gains and losses (which may include third-party fees and expenses, integration, restructuring and consolidation expenses, amortization of acquired inventory fair value step-up, and gains and losses on the sale of certain assets); gains and losses on extinguishment of debt; impairment of assets held for sale; impairment of intangible assets; and non-recurring expenses, gains and losses.
Calculating the fair values of goodwill and indefinite-lived intangible assets for these purposes requires significant estimates and assumptions by management, including future cash flows consistent with management’s - 36 - Table of Contents expectations, annual sales growth rates, and certain assumptions underlying a discount rate based on available market data.
Calculating the fair values of goodwill and indefinite-lived intangible assets for these purposes requires significant estimates and assumptions by management, including future cash flows consistent with management’s expectations, annual sales growth rates, and certain assumptions underlying a discount rate based on available market data.
Our net sales represents gross sales of products shipped to customers plus amounts charged to customers for shipping and handling, less cash discounts, coupon redemptions, slotting fees and trade promotional spending, including marketing development funds. - 40 - Table of Contents Gross Profit. Our gross profit is equal to our net sales less cost of goods sold.
Our net sales represents gross sales of products shipped to customers plus amounts charged to customers for shipping and handling, less cash discounts, coupon redemptions, slotting fees and trade promotional spending, including marketing development funds. Gross Profit. Our gross profit is equal to our net sales less cost of goods sold.
We did not make any contributions to our company-sponsored defined benefit pension plans in fiscal 2022. We made total contributions to our company-sponsored pension plans of $2.5 million during fiscal 2021.
We made total contributions to our company-sponsored pension plans of $2.5 million during fiscal 2023. We did not make any contributions to our company-sponsored defined benefit pension plans in fiscal 2022.
The comparisons of financial results are not necessarily indicative of future results: ​ ​ ​ ​ ​ ​ ​ ​ Fiscal 2022 ​ Fiscal 2021 Statement of Operations Data: ​ ​ ​ ​ ​ ​ Net sales 100.0 % ​ 100.0 % Cost of goods sold 81.1 % ​ 78.7 % Gross profit 18.9 % ​ 21.3 % ​ ​ ​ ​ ​ ​ ​ Operating expenses: ​ ​ ​ ​ ​ ​ Selling, general and administrative expenses 8.8 % ​ 9.5 % Amortization expense ​ 0.9 % ​ 1.1 % Gain on sales of assets ​ (0.3) % ​ — % Impairment of assets held for sale ​ 4.9 % ​ — % Impairment of intangible assets ​ — % ​ 1.2 % Operating income 4.6 % ​ 9.5 % ​ ​ ​ ​ ​ ​ ​ Other (income) and expenses: ​ ​ ​ ​ ​ ​ Interest expense, net 5.8 % ​ 5.1 % Other income ​ (0.3) % ​ (0.2) % (Loss) income before income tax (benefit) expense (0.9) % ​ 4.6 % Income tax (benefit) expense (0.4) % ​ 1.3 % Net (loss) income (0.5) % ​ 3.3 % As used in this section, the terms listed below have the following meanings: Net Sales.
The comparisons of financial results are not necessarily indicative of future results: ​ ​ ​ ​ ​ ​ ​ ​ ​ Fiscal 2023 ​ Fiscal 2022 Statement of Operations Data: ​ ​ ​ ​ ​ ​ Net sales 100.0 % ​ 100.0 % Cost of goods sold 77.9 % ​ 81.1 % Gross profit 22.1 % ​ 18.9 % ​ ​ ​ ​ ​ ​ ​ Operating expenses (income): ​ ​ ​ ​ ​ ​ Selling, general and administrative expenses 9.5 % ​ 8.8 % Amortization expense ​ 0.9 % ​ 0.9 % Loss (gain) on sales of assets ​ 6.7 % ​ (0.3) % Impairment of assets held for sale ​ 0.1 % ​ 4.9 % Impairment of intangible assets ​ 1.0 % ​ — % Operating income 3.9 % ​ 4.6 % ​ ​ ​ ​ ​ ​ ​ Other (income) and expenses: ​ ​ ​ ​ ​ ​ Interest expense, net 7.4 % ​ 5.8 % Other income ​ (0.2) % ​ (0.3) % Loss before income tax benefit (3.3) % ​ (0.9) % Income tax benefit (0.1) % ​ (0.4) % Net loss (3.2) % ​ (0.5) % As used in this section, the terms listed below have the following meanings: Net Sales.
Competitive pressures also may limit our ability to quickly raise prices in response to rising costs. We experienced material net cost increases for raw materials during fiscal 2022 and fiscal 2021 due to a number of factors, including the COVID-19 pandemic and the war in Ukraine, and anticipate higher raw materials cost increases into fiscal 2023.
Competitive pressures also may limit our ability to quickly raise prices in response to rising costs. We experienced material net cost increases for raw materials during early fiscal 2023, fiscal 2022 and fiscal 2021 due to a number of factors, including the war in Ukraine and the COVID-19 pandemic.
For example, despite higher rates for freight in 2021 and 2022, we were able to offset a portion of the freight cost increases through pricing, which included both list price increases and trade spend optimization. We expect freight rates to remain elevated in 2023.
For example, despite higher rates for freight in 2021 and 2022, we were able to offset a portion of the freight cost increases through pricing, which included both list price increases and trade spend optimization. Although freight rates began to decline in 2023, we expect freight rates to remain elevated in 2024.
During fiscal 2022 and fiscal 2021, our net sales to customers in foreign countries represented approximately 7.8% and 8.3%, respectively, of our total net sales. We also purchase a significant majority of our maple syrup requirements from suppliers located in Québec, Canada.
During fiscal 2023 and fiscal 2022, our net sales to customers in foreign countries represented approximately 8.6% and 7.8%, respectively, of our total net sales. We also purchase a significant majority of our maple syrup requirements from suppliers located in Québec, Canada.
Recent Accounting Pronouncements See Note 2(s), “Summary of Significant Accounting Policies — Recently Issued Accounting Standards – Pending Adoption ,” to our consolidated financial statements in Part II, Item 8 of this report. ​ Supplemental Financial Information about B&G Foods and Guarantor Subsidiaries As further discussed in Note 7, “Long-Term Debt,” to our consolidated financial statements in Part II, Item 8 of this report, our obligations under our 5.25% senior notes due 2025 and 5.25% senior notes due 2027 are jointly and severally and fully and unconditionally guaranteed on a senior basis by all of our existing and certain future domestic subsidiaries, which we refer to in this section as the guarantor subsidiaries.
Contingencies See Note 14, “Commitments and Contingencies,” to our consolidated financial statements in Part II, Item 8 of this report. - 50 - Table of Contents Recent Accounting Pronouncements See Note 2(s), “Summary of Significant Accounting Policies — Recently Issued Accounting Standards – Pending Adoption ,” to our consolidated financial statements in Part II, Item 8 of this report. ​ Supplemental Financial Information about B&G Foods and Guarantor Subsidiaries As further discussed in Note 7, “Long-Term Debt,” to our consolidated financial statements in Part II, Item 8 of this report, our obligations under our 5.25% senior notes due 2025, the 5.25% senior notes due 2027, and the 8.00% senior secured notes due 2028 are jointly and severally and fully and unconditionally guaranteed on a senior basis by all of our existing and certain future domestic subsidiaries, which we refer to in this section as the guarantor subsidiaries.
Includes trademark values for multiple brands acquired as part of the acquisition. - 37 - Table of Contents (2) The Clabber Girl acquisition was completed on May 15, 2019. Includes trademark values for multiple brands acquired as part of the acquisition.
Includes trademark values for multiple brands acquired as part of the acquisition. (2) The Clabber Girl acquisition was completed on May 15, 2019. Includes trademark values for multiple brands acquired as part of the acquisition.
Following the impairments recorded in fiscal 2021 and fiscal 2022, none of our indefinite-lived intangible assets had a book value in excess of their calculated fair values and the percentage excess of the aggregate calculated fair value over the aggregate book value was approximately 201.2%.
Following the impairments recorded in fiscal 2023, fiscal 2022 and fiscal 2021, none of our indefinite-lived intangible assets had a book value in excess of their calculated fair values and the percentage excess of the aggregate calculated fair value over the aggregate book value was approximately 228.7%.
As of December 31, 2022, we had $619.2 million of goodwill recorded in our consolidated balance sheet. Our testing indicates that the implied fair value of our company is in excess of the carrying value. However, a change in the cash flow assumptions could result in an impairment of goodwill.
As of December 30, 2023, we had $619.4 million of goodwill recorded in our consolidated balance sheet. Our testing indicates that the implied fair value of our company is in excess of the carrying value. However, a change in the cash flow assumptions could result in an impairment of goodwill.
We then assess the likelihood that our deferred tax assets will be recovered from future taxable income and to the extent we believe the recovery is not likely, we establish a valuation allowance.
These differences result in deferred tax assets and liabilities. We then assess the likelihood that our deferred tax assets will be recovered from future taxable income and to the extent we believe the recovery is not likely, we establish a valuation allowance.
As a result, our adjusted taxable income (used to compute the limitation) decreased and we are subject to the interest expense deduction limitation in fiscal 2022, resulting in an increase to taxable income of $90.2 million. We may continue to be subject to the interest deduction limitation in future years.
As a result, our adjusted taxable income (used to compute the limitation) decreased and we were subject to the interest expense deduction limitation in fiscal 2023 and fiscal 2022, resulting in an increase to taxable income of $107.7 million and $90.2 million, respectively. We may continue to be subject to the interest deduction limitation in future years.
Item 7. Management’s Discussion and Analysis of Financial Conditio n and Results of Operation s. The following Management’s Discussion and Analysis of Financial Condition and Results of Operations contains forward-looking statements that involve risks and uncertainties.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations. The following Management’s Discussion and Analysis of Financial Condition and Results of Operations contains forward-looking statements that involve risks and uncertainties.
Our discount rate assumption for our four company-sponsored defined benefit plans changed from 2.62% - 2.78% at January 1, 2022 to 4.95% - 5.00% at December 31, 2022. As a sensitivity measure, a 0.25% decrease or increase in our discount rate would increase or decrease our pension expense by approximately $0.1 million.
Our discount rate assumption for our four company-sponsored defined benefit plans changed from 4.95% - 5.00% at December 31, 2022 to 4.75% - 4.81% at December 30, 2023. As a sensitivity measure, a 0.25% decrease or increase in our discount rate would increase or decrease our pension expense by approximately $0.1 million.
We are currently locked into our supply and prices for a majority of our most significant raw material - 34 - Table of Contents commodities (excluding, among others, oils) through the first half of fiscal 2023, and for most of our needs for oils through the first quarter of fiscal 2023.
We are currently locked into our supply and prices for a majority of our most significant raw material commodities (excluding, among others, oils) through the first half of fiscal 2024, and for most of our needs for oils through the first quarter and into the second quarter of fiscal 2024.
Our goal is to continue to increase sales, profitability and cash flows through strategic acquisitions, new product development and organic growth.
Our goal is to continue to increase sales, profitability and cash flows through strategic acquisitions, new product development and organic - 35 - Table of Contents growth.
A guarantor subsidiary’s guarantee will be automatically released: (1) in connection with any sale or other disposition of all or substantially all of the assets of that guarantor subsidiary (including by way of merger or consolidation) to a person or entity that is not (either before or after giving effect to such transaction) B&G Foods or a “restricted subsidiary” of B&G Foods under the applicable indenture, if the sale or other disposition complies with the asset sale provisions of the applicable indenture; (2) in connection with any sale or other disposition of all of the capital stock of that guarantor subsidiary to a person or entity that is not (either before or after giving effect to such transaction) B&G Foods or a “restricted subsidiary” of B&G Foods, if the sale or other disposition complies with the asset sale provisions of the applicable indenture; (3) if B&G Foods designates any “restricted subsidiary” that is a guarantor subsidiary to be an “unrestricted subsidiary” in accordance with the applicable provisions of the indenture; (4) upon legal defeasance, covenant defeasance or satisfaction and discharge of the applicable indenture; (5) if such guarantor subsidiary no longer constitutes a domestic subsidiary; or (6) if it is determined in good faith by B&G Foods that a liquidation, dissolution or merger out of existence of such guarantor subsidiary is in the best interests of B&G Foods and is not materially disadvantageous to the holders of the senior notes.
However, we cannot assure you that this provision will be effective to protect the subsidiary guarantees from being voided under fraudulent transfer laws. - 51 - Table of Contents A guarantor subsidiary’s guarantee will be automatically released: (1) in connection with any sale or other disposition of all or substantially all of the assets of that guarantor subsidiary (including by way of merger or consolidation) to a person or entity that is not (either before or after giving effect to such transaction) B&G Foods or a “restricted subsidiary” of B&G Foods under the applicable indenture, if the sale or other disposition complies with the asset sale provisions of the applicable indenture; (2) in connection with any sale or other disposition of all of the capital stock of that guarantor subsidiary to a person or entity that is not (either before or after giving effect to such transaction) B&G Foods or a “restricted subsidiary” of B&G Foods, if the sale or other disposition complies with the asset sale provisions of the applicable indenture; (3) if B&G Foods designates any “restricted subsidiary” that is a guarantor subsidiary to be an “unrestricted subsidiary” in accordance with the applicable provisions of the indenture; (4) upon legal defeasance, covenant defeasance or satisfaction and discharge of the applicable indenture; (5) if such guarantor subsidiary no longer constitutes a domestic subsidiary; or (6) if it is determined in good faith by B&G Foods that a liquidation, dissolution or merger out of existence of such guarantor subsidiary is in the best interests of B&G Foods and is not materially disadvantageous to the holders of the senior notes.
Treasury issued several regulations supplementing the U.S. Tax Act in 2018, including detailed guidance clarifying the calculation of the mandatory tax on previously unrepatriated earnings, application of the existing foreign tax credit rules to newly created categories and expanding details for application of the base erosion tax on affiliate payments.
Tax Act in 2018, including detailed guidance clarifying the calculation of the mandatory tax on previously unrepatriated earnings, application of the existing foreign tax credit rules to newly created categories and expanding details for application of the base erosion tax on affiliate payments.
Changing Consumer Preferences and Channel Shifts. Consumers in the market categories in which we compete frequently change their taste preferences, dietary habits and product packaging preferences.
Consumers in the market categories in which we compete frequently change their taste preferences, dietary habits and product packaging preferences.
We refer to these acquisitions in this report as the “Yuma acquisition” and the “ Crisco acquisition.” These acquisitions have been accounted for using the acquisition method of accounting and, accordingly, the assets acquired, liabilities assumed and results of operations of the acquired businesses are included in our consolidated financial statements from the date of acquisition.
We refer to this acquisition in this report as the “Yuma acquisition.” This acquisition has been accounted for using the acquisition method of accounting and, accordingly, the assets acquired, liabilities assumed and results of operations of the acquired business are included in our consolidated financial statements from the date of acquisition.
The table below sets forth the book value as of December 31, 2022 of the indefinite-lived trademarks for each of our brands whose net sales equaled or exceeded 3% of our fiscal 2022 or fiscal 2021 net sales and for “all other brands” in the aggregate (in thousands): ​ ​ ​ ​ ​ December 31, 2022 Brand: ​ ​ Green Giant ​ $ 422,000 Crisco ​ ​ 321,340 Dash ​ ​ 189,000 Spices & Seasonings (1) ​ ​ 65,200 Ortega ​ ​ 32,339 Cream of Wheat ​ 27,000 Clabber Girl (2) ​ ​ 19,600 Maple Grove Farms of Vermont ​ 11,627 All other brands ​ 486,034 Total indefinite-lived trademarks ​ $ 1,574,140 (1) The spices & seasonings acquisition was completed on November 21, 2016.
The table below sets forth the book value as of December 30, 2023 of the indefinite-lived trademarks for each of our brands whose net sales equaled or exceeded 3% of our fiscal 2023 or fiscal 2022 net sales and for “all other brands” in the aggregate (in thousands): ​ ​ ​ ​ ​ December 30, 2023 Brand: ​ ​ Crisco ​ $ 321,683 Green Giant ​ ​ 306,660 Dash ​ ​ 189,000 Spices & Seasonings (1) ​ ​ 65,200 Ortega ​ ​ 32,339 Cream of Wheat ​ 27,000 Clabber Girl (2) ​ ​ 19,600 Maple Grove Farms of Vermont ​ 11,627 All other brands ​ 465,534 Total indefinite-lived trademarks ​ $ 1,438,643 (1) The spices & seasonings acquisition was completed on November 21, 2016.
Internal Revenue Code of 1986, as amended. The changes in the U.S. Tax Act are broad and complex and we continue to examine the impact the U.S. Tax Act may have on our business and financial results. The U.S. Tax Act contains provisions with separate effective dates but was generally effective for taxable years beginning after December 31, 2017.
Tax Act are broad and complex and we continue to examine the impact the U.S. Tax Act may have on our business and financial results. The U.S. Tax Act contains provisions with separate effective dates but was generally effective for taxable years beginning after December 31, 2017.
Raw materials and other input costs, such as fuel and transportation, are subject to fluctuations in price attributable to a number of factors, including the COVID-19 pandemic, the war in Ukraine, climate and weather conditions, supply chain disruptions (including raw material shortages) and labor shortages.
Raw materials and other input costs, such as fuel and transportation, are subject to fluctuations in price attributable to a number of factors, including climate and weather conditions, supply chain disruptions (including raw material shortages), labor shortages, wars and pandemics.
Consolidation in the Retail Trade and Consequent Inventory Reductions. As customers, such as supermarkets, discounters, e-commerce merchants, warehouse clubs and food distributors, continue to consolidate and grow larger and become more sophisticated, our retail customers may demand lower pricing and increased promotional programs. These customers are also reducing their inventories and increasing their emphasis on private label products.
As customers, such as supermarkets, discounters, e-commerce merchants, warehouse clubs and food distributors, continue to consolidate and grow larger and become more sophisticated, our retail customers may demand lower pricing and increased promotional programs. These customers are also reducing their inventories and increasing their emphasis on private label products. Changing Consumer Preferences and Channel Shifts.
All assumptions used in our impairment evaluations for goodwill and indefinite-lived intangible assets, such as forecasted growth rates and discount rate, are based on the best available market information and are consistent with our internal forecasts and operating plans. We believe these assumptions to be reasonable, but they are inherently uncertain.
All assumptions used in our impairment evaluations for goodwill and indefinite-lived intangible assets, such as forecasted growth rates and discount rate, are based on the best available market information and are consistent with our internal forecasts and operating plans.
Expressed as a percentage of net sales, selling, general and administrative expenses improved by 0.7 percentage points to 8.8% for fiscal 2022, as compared to 9.5% for fiscal 2021. Amortization Expense. Amortization expense decreased $0.3 million to $21.3 million for fiscal 2022 from $21.6 million for fiscal 2021. - 45 - Table of Contents Gain on Sales of Assets .
Expressed as a percentage of net sales, selling, general and administrative expenses increased by 0.7 percentage points to 9.5% for fiscal 2023, as compared to 8.8% for fiscal 2022. Amortization Expense. Amortization expense decreased $0.5 million to $20.8 million for fiscal 2023 from $21.3 million for fiscal 2022. (Loss) Gain on Sales of Assets .
Other income for fiscal 2021 includes the non-service portion of net periodic pension cost and net periodic post-retirement benefit costs of $4.4 million and the remeasurement of monetary assets denominated in a foreign currency into U.S. dollars of $0.1 million. Income Tax (Benefit) Expense.
Other Income. Other income for fiscal 2023 primarily includes the non-service portion of net periodic pension cost and net periodic post-retirement benefit costs of $3.8 million and the remeasurement of monetary assets denominated in a foreign currency into U.S. dollars of less than $0.1 million.
Tax Act on our cash income tax payments, including the impact the U.S. Tax Act had in fiscal 2022 and fiscal 2021 and is expected to have in fiscal 2023 and beyond on our interest expense deductions and our cash taxes.
Tax Act” above for a discussion of the impact and expected impact of the U.S. Tax Act on our cash income tax payments, including the impact the U.S. Tax Act had in fiscal 2023 and fiscal 2022 and is expected to have in fiscal 2024 and beyond on our interest expense deductions and our cash taxes.
These acquisitions and the application of the acquisition method of accounting affect comparability between periods. On January 3, 2023, we completed the sale of the Back to Nature business to a subsidiary of Barilla America, Inc. We refer to this divestiture in this report as the “ Back to Nature sale.” This divestiture will affect comparability between periods.
This acquisition and the application of the acquisition method of accounting affect comparability between periods. On January 3, 2023, we completed the sale of the Back to Nature business to a subsidiary of Barilla America, Inc.
The decrease was composed of decreases in acquisition/divestiture-related and non-recurring expenses of $11.9 million and consumer marketing expenses of $2.2 million, partially offset by increases in selling expenses of $5.0 million, general and administrative expenses of $3.1 million and warehousing expenses of $0.2 million.
The increase was composed of increases in general and administrative expenses of $14.1 million and consumer marketing expenses of $3.1 million, partially offset by decreases in warehousing expenses of $5.3 million, selling expenses of $3.2 million and - 47 - Table of Contents acquisition/divestiture-related and non-recurring expenses of $3.1 million.
The following tables present summarized unaudited financial information on a combined basis for B&G Foods and each of the guarantor subsidiaries of the senior notes described above after elimination of (1) intercompany transactions and balances among B&G Foods and the guarantor subsidiaries and (2) investments in any subsidiary that is a non-guarantor (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ December 31, January 1, ​ ​ 2022 ​ 2022 Current assets (1) ​ $ 930,287 ​ $ 752,685 Non-current assets ​ ​ 2,746,965 ​ ​ 2,921,036 Current liabilities (2) ​ ​ 200,307 ​ ​ 225,554 Non-current liabilities ​ $ 2,751,661 ​ $ 2,663,841 (1) Current assets includes amounts due from non-guarantor subsidiaries of $37.7 million and $46.6 million as of December 31, 2022 and January 1, 2022, respectively.
The following tables present summarized unaudited financial information on a combined basis for B&G Foods and each of the guarantor subsidiaries of the senior notes described above after elimination of (1) intercompany transactions and balances among B&G Foods and the guarantor subsidiaries and (2) investments in any subsidiary that is a non-guarantor (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ December 30, December 31, ​ ​ 2023 ​ 2022 Current assets (1) ​ $ 711,926 ​ $ 930,287 Non-current assets ​ ​ 2,577,910 ​ ​ 2,746,965 Current liabilities (2) ​ ​ 239,904 ​ ​ 200,307 Non-current liabilities ​ $ 2,365,338 ​ $ 2,751,661 (1) Current assets includes amounts due from non-guarantor subsidiaries of $53.6 million and $37.7 million as of December 30, 2023 and December 31, 2022, respectively.
We measured the assets held for sale at the lower of their carrying value or fair value less anticipated costs to sell and recorded pre-tax, non-cash impairment charges of $106.4 million during fiscal 2022 relating to those assets.
We then measured the assets held for sale at the lower of their carrying value or fair value less anticipated costs to sell and recorded pre-tax, non-cash impairment charges of $103.6 million.
Excluding the negative impact of a $13.9 million accrual for the estimated present value of a multi-employer pension plan withdrawal liability in connection with the sale and closure of our Portland, Maine manufacturing facility, $14.6 million of acquisition/divestiture-related expenses, and $5.1 million of amortization of acquisition-related inventory fair value step-up and non-recurring expenses included in cost of goods sold during fiscal 2021, our gross profit would have been $470.6 million, or 22.9% of net sales.
Acquisition/divestiture related expenses and non-recurring expenses included in cost of goods sold for fiscal 2021 of $33.6 million primarily includes a $13.9 million accrual for the estimated present value of a multi-employer pension plan withdrawal liability in connection with the sale and closure of our Portland, Maine manufacturing facility, $14.6 million of acquisition/divestiture-related expenses, and $5.1 million of amortization of acquisition-related inventory fair value step-up and non-recurring expenses.
(2) During the first quarter of 2022, we completed the closure and sale of our Portland, Maine manufacturing facility. We recorded a gain on the sale of the Portland property, plant and equipment of $7.1 million during the first quarter of 2022.
We recorded a gain on the sale of the Portland property, plant and equipment of $7.1 million during the first quarter of 2022.
Actual results could differ significantly from these estimates and assumptions. Our significant accounting policies are described more fully in note 2 to our consolidated financial statements included elsewhere in this report. We believe the following critical accounting policies involve the most significant judgments and estimates used in the preparation of our consolidated financial statements.
Actual results could differ significantly from these estimates and assumptions. Our significant accounting policies are described more fully in note 2 to our consolidated financial statements included elsewhere in this report.
In connection with our decision to sell our Back to Nature business, we reclassified $109.9 million of indefinite-lived trademark intangible assets, $29.5 million of goodwill, $11.0 million of finite-lived customer relationship intangible assets and $7.3 million of inventories to assets held for sale during fiscal 2022.
During the third quarter of 2022, we reclassified $109.9 million of indefinite-lived trademark intangible assets, $29.5 million of goodwill, $11.0 million of finite-lived customer relationship intangible assets and $7.3 million of inventories to assets held for sale during fiscal 2022.
During the first quarter of 2022, we completed the sale of our Portland, Maine manufacturing facility and 13.5 acre property and separately sold certain other equipment that had been used at the facility. We received combined sales proceeds for the property and the equipment of approximately $11.1 million and recognized a gain of $7.1 million.
During the first quarter of 2022, we completed the closure and sale of our Portland, Maine manufacturing facility. We received combined sales proceeds for the property and the equipment of approximately $11.1 million and recognized a gain of $7.1 million.
Excluding the negative impact of $9.1 million of acquisition/divestiture-related expenses and non-recurring expenses included in cost of goods sold during fiscal 2022, our gross profit would have been $418.7 million, or 19.4% of net sales. Gross profit was $437.0 million for fiscal 2021, or 21.3% of net sales.
Adjusted gross profit, which excludes the negative impact of $9.1 million of acquisition/divestiture-related expenses and non-recurring expenses included in cost of goods sold during fiscal 2022, was $418.7 million, or 19.4% of net sales.
We partially impaired the Static Guard and Molly McButter brands, and we fully impaired the SnackWell’s and Farmwise brands, which have been discontinued. Certain Farmwise branded products have been transitioned to the Green Giant brand. As of December 31, 2022, we had $1,574.1 million of indefinite-lived intangible assets recorded in our consolidated balance sheet.
We partially impaired the Static Guard and Molly McButter brands, and we fully impaired the SnackWell’s and Farmwise brands, which have been discontinued. As of December 30, 2023, we had $1,438.6 million of indefinite-lived intangible assets recorded in our consolidated balance sheet.
For example, if future revenues and contributions to our operating results for the Static Guard and Molly McButter brands continue to deteriorate, or if future revenues and contributions to our operating results for any of our other brands, including newly acquired brands, deteriorate, at rates in excess of our current projections, this could result in additional impairment losses for those brands.
However, materially different assumptions regarding the future performance of our businesses or discount rates could result in significant additional impairment losses. For example, if future revenues and contributions to our operating results for any of our brands, including newly acquired brands, deteriorate, at rates in excess of our current projections, this could result in additional impairment losses for those brands.
For a more detailed description about our pension expense, the company-sponsored pension plans to which we contribute, and the multi-employer pension plan withdrawal liability, see Note 12, “Pension Benefits,” to our consolidated financial statements in Part II, Item 8 of this report.
The remaining estimated present value of that liability of $12.9 million is recorded on our consolidated balance sheet as of December 30, 2023. - 40 - Table of Contents For a more detailed description about our pension expense, the company-sponsored pension plans to which we contribute, and the multi-employer pension plan withdrawal liability, see Note 12, “Pension Benefits,” to our consolidated financial statements in Part II, Item 8 of this report.
Prior to the withdrawal, we made periodic contributions to this plan pursuant to the terms of a collective bargaining agreement. Our withdrawal from the plan requires us to make withdrawal liability payments to the plan of approximately $0.9 million per year for 20 years commencing March 1, 2022.
Our withdrawal from the plan requires us to make withdrawal liability payments to the plan of approximately $0.9 million per year for 20 years commencing March 1, 2022.
Our foreign subsidiaries are not guarantors, and any future foreign or partially owned domestic subsidiaries will not be guarantors, of the 5.25% senior notes due 2025 or the 5.25% senior notes due 2027. In this section, we refer to these foreign subsidiaries and future foreign or partially owned domestic subsidiaries as the non-guarantor subsidiaries.
Our foreign subsidiaries are not guarantors, and any future foreign or partially owned domestic subsidiaries will not be guarantors, of the 5.25% senior notes due 2025, the 5.25% senior notes due 2027, or the 8.00% senior secured notes due 2028.
Since 1996, we have successfully acquired and integrated more than 50 brands into our company. Over the last three years, we have completed two material acquisitions. Most recently, on May 5, 2022, we acquired the frozen vegetable manufacturing operations of Growers Express, LLC. On December 1, 2020, we acquired the Crisco oils and shortening business from The J.M.
Since 1996, we have successfully acquired and integrated more than 50 brands into our company. Most recently, on May 5, 2022, we acquired the frozen vegetable manufacturing operations of Growers Express, LLC.
We have recorded a deferred tax asset of $22.2 million related to the interest deduction carryover, without a valuation allowance, as the disallowed interest may be carried forward indefinitely. The increase in our cash taxes resulting from the interest expense deduction limitation is approximately $20.6 million for fiscal 2022.
We have recorded a deferred tax asset of $46.9 million and $22.2 million for fiscal 2023 and fiscal 2022, respectively, related to the interest deduction carryover, without a valuation allowance, as the disallowed interest may be carried forward indefinitely.
The positive impact during the quarter of the gain on sale was partially offset by approximately $2.2 million of expenses incurred during the quarter relating to the closure of the facility and the transfer of manufacturing operations, resulting in a net benefit of $4.9 million (or $3.7 million, net of tax) from the gain on sale. - 43 - Table of Contents (3) For fiscal 2021, amortization of acquisition-related inventory step-up of $5.1 million (or $3.8 million, net of tax) primarily relates to the purchase accounting adjustments made to inventory acquired in the Crisco acquisition.
The positive impact during the quarter of the gain on sale was partially offset by approximately $2.2 million of expenses incurred during the quarter relating to the closure of the facility and the transfer of manufacturing operations, resulting in a net benefit of $4.9 million (or $3.7 million, net of tax) from the gain on sale.
Selling, general and administrative expenses decreased $5.8 million, or 2.9%, to $190.4 million for fiscal 2022 from $196.2 million for fiscal 2021.
Selling, general and administrative expenses increased $5.6 million, or 3.0%, to $196.0 million for fiscal 2023 from $190.4 million for fiscal 2022.
On December 31, 2022, the aggregate principal amount of our long-term debt (including current portion) of $2,404.1 million, net of our cash and cash equivalents of $45.4 million, was $2,358.7 million. Stockholders’ equity as of that date was $868.2 million.
On December 30, 2023, the aggregate principal amount of our long-term debt (including current portion) of $2,064.0 million, net of our cash and cash equivalents of $41.1 million, was $2,022.9 million. Stockholders’ equity as of that date was $835.5 million.
The impact of future acquisitions, whether financed with additional indebtedness or otherwise, may have a material impact on our liquidity and capital resources.
We financed the Yuma acquisition, completed in May 2022, with cash on hand and revolving loans under our existing credit facility. The impact of future acquisitions, whether financed with additional indebtedness or otherwise, may have a material impact on our liquidity and capital resources.
We were not subject to an interest expense deduction limitation in fiscal 2020 but were subject to the limitation in fiscal 2021, which increased our taxable income by $6.7 million. Beginning with fiscal 2022, our adjusted taxable income as computed for purposes of the interest expense deduction limitation is computed after any deduction allowable for depreciation and amortization.
Beginning with fiscal 2022, our adjusted taxable income as computed for purposes of the interest expense deduction limitation is computed after any deduction allowable for depreciation and amortization.
The decrease was also due to unfavorable working capital comparisons in fiscal 2022 compared to fiscal 2021, primarily comprised of income tax receivable/payable, trade accounts payable, prepaid expenses and other current assets, inventories, and other assets, partially offset by favorable working capital comparisons related to trade accounts receivable, other liabilities and accrued expenses and lease liabilities.
The increase was largely due to an increase in gross profit and favorable working capital comparisons in fiscal 2023 compared to fiscal 2022, primarily comprised of inventories, accrued expenses and lease liabilities, and trade accounts receivable, partially offset by unfavorable working capital comparisons related to trade accounts payable and other liabilities. Net Cash Provided by (Used in) Investing Activities .
Net Cash Provided by (Used in) Financing Activities . Net cash provided by financing activities increased $115.1 million to $45.3 million cash provided by financing activities for fiscal 2022 from $69.8 million net cash used in financing activities for fiscal 2021.
Net cash used in financing activities increased $379.0 million to $333.7 million for fiscal 2023 from $45.3 million of net cash provided by financing activities for fiscal 2022.
During fiscal 2023 we expect to make contributions of approximately $2.5 million for our four company-sponsored defined benefit pension plans. - 38 - Table of Contents During the fourth quarter of fiscal 2021, we closed our manufacturing facility in Portland, Maine and withdrew from participation in a multi-employer defined benefit pension plan maintained by the labor union that represented certain of our employees at the facility.
During the fourth quarter of fiscal 2021, we closed our manufacturing facility in Portland, Maine and withdrew from participation in a multi-employer defined benefit pension plan maintained by the labor union that represented certain of our employees at the facility. Prior to the withdrawal, we made periodic contributions to this plan pursuant to the terms of a collective bargaining agreement.
Costs and expenses in Mexico are recognized in local foreign currency, and therefore we are exposed to potential gains or losses from the translation of those amounts into U.S. dollars for consolidation into our consolidated financial statements. - 35 - Table of Contents To confront these challenges, we continue to take steps to build the value of our brands, to improve our existing portfolio of products with new product and marketing initiatives, to reduce costs through improved productivity, to address consumer concerns about food safety, quality and health and to favorably manage currency fluctuations.
To confront these challenges, we continue to take steps to build the value of our brands, to improve our existing portfolio of products with new product and marketing initiatives, to reduce costs through improved productivity, to address consumer concerns about food safety, quality and health and to favorably manage currency fluctuations.
As a result of the foregoing, operating income decreased $97.5 million, or 49.7%, to $98.6 million for fiscal 2022 from $196.1 million for fiscal 2021. Operating income expressed as a percentage of net sales decreased to 4.6% in fiscal 2022 from 9.5% in fiscal 2021. Net Interest Expense.
Operating income expressed as a percentage of net sales decreased to 3.9% in fiscal 2023 from 4.6% in fiscal 2022. Net Interest Expense. Net interest expense increased $26.4 million, or 21.1%, to $151.3 million for fiscal 2023 from $124.9 million in fiscal 2022.
During the third quarter of 2022, we measured the assets held for sale at the lower of their carrying value or fair value less anticipated costs to sell and recorded pre-tax, non-cash impairment charges of $103.6 million, and during the fourth quarter of 2022, we recorded an additional $2.8 million of pre-tax, non-cash impairment charges related to those assets after we entered into an agreement to sell the Back to Nature business on December 15, 2022.
During the fourth quarter of 2022, we recorded an additional $2.8 million of pre-tax, non-cash impairment charges related to those assets after we entered into an agreement to sell the Back to Nature business on December 15, 2022. The sale of the Back to Nature business was completed on January 3, 2023 (the first business day of fiscal 2023).
See Note 3, “Acquisitions and Divestitures,” to our consolidated financial statements in Part II, Item 8 of this report. U.S. Tax Act and U.S. CARES Act On December 22, 2017, the Tax Cuts and Jobs Act, which we refer to as the “U.S. Tax Act,” was signed into law. The U.S. Tax Act provides for significant changes in the U.S.
Tax Act On December 22, 2017, the Tax Cuts and Jobs Act, which we refer to as the “U.S. Tax Act,” was signed into law. The U.S. Tax Act provides for significant changes in the U.S. Internal Revenue Code of 1986, as amended. The changes in the U.S.
We completed our annual impairment tests for fiscal 2022 and fiscal 2020 with no adjustments to the carrying values of indefinite-lived intangible assets.
See Note 3, “Acquisitions and Divestitures” to our consolidated financial statements in Part II, Item 8 of this report. We completed our annual impairment tests for fiscal 2022 with no adjustments to the carrying values of indefinite-lived intangible assets.
Results of Operations The following table sets forth the percentages of net sales represented by selected items for fiscal 2022 and fiscal 2021 reflected in our consolidated statements of operations.
See Note 10, “Income Taxes,” to our consolidated financial statements in Part II, Item 8 of this report. - 41 - Table of Contents Results of Operations The following table sets forth the percentages of net sales represented by selected items for fiscal 2023 and fiscal 2022 reflected in our consolidated statements of operations.
See Note 6, “Goodwill and Other Intangible Assets” to our consolidated financial statements for a more detailed description of the impairment of intangible assets in fiscal 2021.
See Note 6, “Goodwill and Other Intangible Assets” to our consolidated financial statements for a more detailed description of the impairment of intangible assets in fiscal 2023. Operating Income. As a result of the foregoing, operating income decreased $18.2 million, or 18.5%, to $80.4 million for fiscal 2023 from $98.6 million for fiscal 2022.
Impairment on intangible assets represents a reduction of the carrying value of intangible assets to fair value when the carrying value of the assets is no longer recoverable. Net Interest Expense. Net interest expense includes interest relating to our outstanding indebtedness, amortization of bond discount/premium and amortization of deferred debt financing costs (net of interest income). Other Income.
Impairment on intangible assets represents a reduction of the carrying value of intangible assets to fair value when the carrying value of the assets is no longer recoverable. Net Interest Expense.
However, management uses these metrics in conjunction with traditional GAAP operating performance and liquidity measures as part of its overall assessment of company performance and liquidity, and therefore does not place undue reliance on these measures as its only measures of operating performance and liquidity.
However, management uses these metrics in conjunction with traditional GAAP operating performance and liquidity measures as part of its overall assessment of company performance and liquidity, and therefore does not place undue reliance on these measures as its only measures of operating performance and liquidity. - 43 - Table of Contents EBITDA and adjusted EBITDA are not recognized terms under GAAP and do not purport to be alternatives to operating income, net income (loss) or any other GAAP measure as an indicator of operating performance.

… 116 more changes not shown on this page.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

9 edited+0 added−1 removed6 unchanged
Biggest changeThe carrying values and fair values of our revolving credit loans, term loans and senior notes as of December 31, 2022 and January 1, 2022 were as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, 2022 ​ ​ January 1, 2022 ​ Carrying Value Fair Value Carrying Value Fair Value Revolving credit loans ​ $ 282,500 ​ $ 282,500 (1) ​ $ 165,000 ​ $ 165,000 (1) ​ Tranche B term loans due 2026 ​ ​ 668,532 (2) ​ ​ 636,777 (3) ​ ​ 667,811 (2) ​ ​ 666,141 (3) ​ 5.25% senior notes due 2025 ​ ​ 901,213 (4) ​ ​ 790,625 (3) ​ ​ 901,753 (4) ​ ​ 920,915 (3) ​ 5.25% senior notes due 2027 ​ $ 550,000 ​ $ 420,558 (3) ​ $ 550,000 ​ $ 567,875 (3) ​ (1) Fair values are estimated based on Level 2 inputs, which were quoted prices for identical or similar instruments in markets that are not active.
Biggest changeBased upon our principal amount of long-term debt outstanding at December 30, 2023, a hypothetical 1.0% increase or decrease in interest rates would have affected our annual interest expense by approximately $7.0 million. - 52 - Table of Contents The carrying values and fair values of our revolving credit loans, term loans and senior notes as of December 30, 2023 and December 31, 2022 were as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 30, 2023 ​ ​ December 31, 2022 ​ Carrying Value Fair Value Carrying Value Fair Value Revolving credit loans ​ $ 170,000 ​ $ 170,000 (1) ​ $ 282,500 ​ $ 282,500 (1) ​ Tranche B term loans due 2026 ​ ​ 527,443 (2) ​ ​ 522,169 (3) ​ ​ 668,532 (2) ​ ​ 636,777 (3) ​ 5.25% senior notes due 2025 ​ ​ 265,592 (4) ​ ​ 261,608 (3) ​ ​ 901,213 (4) ​ ​ 790,625 (3) ​ 5.25% senior notes due 2027 ​ ​ 550,000 ​ ​ 497,750 (3) ​ ​ 550,000 ​ ​ 420,558 (3) ​ 8.00% senior secured notes due 2028 ​ $ 547,372 (5) ​ $ 572,688 (3) ​ $ — ​ $ — ​ (1) Fair values are estimated based on Level 2 inputs, which were quoted prices for identical or similar instruments in markets that are not active.
See Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Policies; Use of Estimates – Pension Plans ” and Note 12, “Pension Benefits,” to our consolidated financial statements in Part II, Item 8 of this report for a discussion of the exposure of our defined benefit pension plan assets to risks related to market fluctuations. - 51 - Table of Contents
See Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Policies; Use of Estimates – Pension Plans ” and Note 12, “Pension Benefits,” to our consolidated financial statements in Part II, Item 8 of this report for a discussion of the exposure of our defined benefit pension plan assets to risks related to market fluctuations. - 53 - Table of Contents
During fiscal 2022, 2021 and 2020, our net sales to customers in foreign countries represented approximately 7.8%, 8.3% and 7.8%, respectively, of our total net sales. We also purchase certain raw materials from foreign suppliers. For example, we purchase a significant majority of our maple syrup requirements from suppliers in Québec, Canada. These purchases are made in Canadian dollars.
During fiscal 2023, 2022 and 2021, our net sales to customers in foreign countries represented approximately 8.6%, 7.8% and 8.3%, respectively, of our total net sales. We also purchase certain raw materials from foreign suppliers. For example, we purchase a significant majority of our maple syrup requirements from suppliers in Québec, Canada. These purchases are made in Canadian dollars.
Market risk is defined for these purposes as the potential change in the fair value of a financial asset or liability resulting from an adverse movement in interest rates. - 50 - Table of Contents Changes in interest rates impact our fixed and variable rate debt differently.
Market risk is defined for these purposes as the potential change in the fair value of a financial asset or liability resulting from an adverse movement in interest rates. Changes in interest rates impact our fixed and variable rate debt differently.
Item 7A. Quantitative and Qualitative Disclosures About Market Ris k Our principal market risks are exposure to changes in commodity prices, interest rates on borrowings and foreign currency exchange rates and market fluctuation risks related to our defined benefit pension plans. Commodity Prices and Inflation.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk Our principal market risks are exposure to changes in commodity prices, interest rates on borrowings and foreign currency exchange rates and market fluctuation risks related to our defined benefit pension plans. Commodity Prices and Inflation.
(2) The carrying value of the tranche B term loans includes a discount. At December 31, 2022, and January 1, 2022, the face amount of the tranche B term loans was $671.6 million. See Note 18, “Subsequent Events.” (3) Fair values are estimated based on quoted market prices.
(2) The carrying value of the tranche B term loans includes a discount. At December 30, 2023, and December 31, 2022, the face amount of the tranche B term loans was $528.6 million and $671.6 million, respectively. (3) Fair values are estimated based on quoted market prices.
For fixed rate debt, a change in interest rates will only impact the fair value of the debt, whereas for variable rate debt, a change in the interest rates will impact interest expense and cash flows. At December 31, 2022, we had $1,450.0 million of fixed rate debt and $954.1 million of variable rate debt.
For fixed rate debt, a change in interest rates will only impact the fair value of the debt, whereas for variable rate debt, a change in the interest rates will impact interest expense and cash flows. At December 30, 2023, we had $1,365.4 million of fixed rate debt and $698.6 million of variable rate debt.
(4) The carrying value of the 5.25% senior notes due 2025 includes a premium. At December 31, 2022 and January 1, 2022, the face amount of the 5.25% senior notes due 2025 was $900.0 million.
(4) The carrying value of the 5.25% senior notes due 2025 includes a premium. At December 30, 2023 and December 31, 2022, the face amount of the 5.25% senior notes due 2025 was $265.4 million and $900.0 million, respectively. (5) The carrying value of 8.00% senior secured notes due 2028 includes a discount.
Cash and cash equivalents, trade accounts receivable, income tax receivable/payable, trade accounts payable, accrued expenses and dividends payable are reflected on our consolidated balance sheets at carrying value, which approximates fair value due to the short-term nature of these instruments.
At December 30, 2023, the face amount of the 8.00% senior secured notes due 2028 was $550.0 million. Cash and cash equivalents, trade accounts receivable, income tax receivable/payable, trade accounts payable, accrued expenses and dividends payable are reflected on our consolidated balance sheets at carrying value, which approximates fair value due to the short-term nature of these instruments.
Removed
Based upon our principal amount of long-term debt outstanding at December 31, 2022, a hypothetical 1.0% increase or decrease in interest rates would have affected our annual interest expense by approximately $9.5 million.

Other BGS 10-K year-over-year comparisons