Question-and-Answer Session
Operator
(Operator Instructions) Your first call comes from Heather Jones with BB&T Capital Markets.
Heather Jones - BB&T Capital Markets
I had a couple of questions. One was I’m curious about your new walnut prices. Recently the estimate for the crop, it seems like it’s going to be up about 15% year-on-year and I’m just wondering if you think that’s going to bring down prices there?
Michael J. Mendes
We did note that the crop is going to be quite larger, based on the estimate. I think some of the things you need to factor, sort of into the context of that, is total supply. The carry-out inventory is at a record low going into this crop so that will have an impact on total supply.
Additionally, while the dollar has strengthened a bit in these last few weeks, it’s about 4% to 5% weaker than a year ago last year when we were contracting against the crop.
Finally, the pecan crop this year is below the off-cycle crop so it’s going to be a shorter crop and spot prices on pecans are reported to be quite high, considerably higher than even last year’s walnut prices at its peak.
So I think in context, it’s a little too early to say obviously with a larger walnut crop and also larger almond crop, I do think we are definitely are in a position where we can see some stabilization of pricing which would be viewed as a positive for us and that’s dialed into our forecast.
Heather Jones - BB&T Capital Markets
How much did the culinary category grow during the quarter? The category, not your sales. I think last year, or fiscal 2008, you benefited from being added to the bake aisle at Walmart and so I’m just trying to get a feel for what kind of growth are you projecting into fiscal 2009 for culinary.
Andrew Burke
The culinary category over the last quarter, and this is based on syndicated data, in terms of dollars was up about 6%. And that comes off a 52-week number of about 4%. The thing we like to see about that, which was mentioned in the call, was the culinary category seems to be really increasing over the last quarter and what we think is the driver of this is the fact that consumers are cutting down the amount of meals that eat out of home and they are preparing meals at home, which is perfect for our brand and our business and supports a lot of the activities that we are currently doing.
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