Nash Finch Reports Fourth Quarter and Fiscal 2007 Results

Nash Finch Company (NASDAQ: NAFC), one of the leading food distribution companies in the United States, today announced financial results for the fourth quarter and year ended December 29, 2007. Financial Results Sales for fiscal 2007 were $4.533 billion compared to $4.632 billion in fiscal 2006. Sales for the fourth quarter of 2007 were $1.069 billion as compared to $1.099 billion in the prior year quarter. The fiscal year and fourth quarter sales declines of 2.1% and 2.7%, respectively, are primarily due to the previously announced transition of a large customer in the food distribution segment to another supplier and the closure of three retail stores. These sales declines were partially offset by stronger sales in the military segment. Excluding the impact of the sales decrease attributable to this customer, total company sales increased 0.9% in the fourth quarter and decreased by 0.3% for the year. For fiscal 2007, the Company’s net earnings were $38.8 million, or $2.84 per diluted share, as compared to a net loss of $23.0 million, or $1.72 per diluted share, for fiscal 2006. During the fourth quarter of 2007, net earnings were $8.5 million, or $0.62 per diluted share, as compared to a net loss of $26.4 million, or $1.96 per diluted share, in the prior year quarter. Net earnings for both years were affected by several significant items and are detailed in the table below. Consolidated EBITDA1 for fiscal 2007 was $128.8 million, or 2.8% of sales, compared to $102.7 million, or 2.2% of sales, for fiscal 2006. In the fourth quarter 2007, Consolidated EBITDA was $30.2 million, or 2.8% of sales, compared to $23.9 million, or 2.2% of sales, in the prior year quarter. Consolidated EBITDA is a non-GAAP financial measure that is reconciled to the most directly comparable GAAP financial results in the attached financial statements. "I am very pleased with the significant operational improvements made during fiscal 2007,” said Alec Covington, President and CEO of Nash Finch. "Consolidated EBITDA increased 25.4% compared to fiscal 2006 confirming our belief that we could make significant strides in restoring the financial vitality of the company during fiscal 2007. In addition, I am also pleased to report that excluding the sales decrease attributable to a large account which transitioned to another supplier earlier this year, our fourth quarter sales comparison to the prior year turned positive for both our food distribution segment and the total company.” The following table identifies the significant pre-tax charges affecting our earnings from continuing operations and Consolidated EBITDA for the fourth quarter and fiscal year 2007 and prior year results:                         4th Quarter   4th Quarter   Fiscal   Fiscal (dollars in millions except per share amounts)   2007   2006   2007   2006 Significant charges Increase in allowance for doubtful accounts on receivables $ - 0.7 - 2.5 Promotional markdowns and closure costs of retail stores $ 2.6 1.1 3.1 2.3 Severance costs due to senior management changes $ - - - 4.2 Gain on sale of intangible asset $ - - (0.7 ) - Costs related to change in vacation policy $ -   3.4   -     2.0 Significant charges impacting Consolidated EBITDA $ 2.6 5.2 2.4 11.0   Goodwill impairment of retail segment $ - 26.4 - 26.4 Change in estimate of 2004 special charge $ - - (1.3 ) 6.3 Asset impairments and lease costs on closed retail stores $ - 5.4 1.4 7.5 Increase in lease reserves relating to customer leases $ - 1.5 0.8 5.9 Charges due to the bankruptcy of a long-time customer $ - - - 4.1 Impairment of trade name $ - - - 2.0 2006 credit facility amendment fee $ -   0.5   -     0.5 Significant charges impacting pre-tax income $ 2.6   39.0   3.3     63.7 Diluted earnings per share impact (net of tax)   $ 0.11   2.49   0.15     3.62 Food Distribution Results                               (dollars in millions)   4th Quarter   4th Quarter   %   Fiscal   Fiscal   %     2007   2006   Change   2007   2006   Change Sales $ 635.2 666.5 (4.7 %) 2,693.3 2,787.7 (3.4 %) Segment EBITDA1 $ 26.1 20.2 29.2 % 102.2 86.7 17.9 % Percentage of Sales     4.1 %   3.0 %       3.8 %   3.1 %                                         Food distribution sales were negatively impacted in both the quarterly and fiscal year comparisons due to the impact of a large customer which transitioned to another supplier in mid-2007. However, excluding the impact of the $39.3 million sales decrease during the fourth quarter attributable to this customer, food distribution sales for the quarter increased 1.3% compared to the prior year period. Food distribution segment EBITDA increased 29.2% in the fourth quarter and 17.9% for the fiscal year relative to the prior year periods. This reflects a significant increase in food distribution profit margin primarily due to improvements realized through more effective inventory management and expense reductions. Military Distribution Results                               (dollars in millions)   4th Quarter   4th Quarter   %   Fiscal   Fiscal   %     2007   2006   Change   2007   2006   Change Sales $ 299.2 288.5 3.7 % 1,247.6 1,195.0 4.4 % Segment EBITDA1 $ 10.5 9.9 6.1 % 44.0 41.3 6.7 % Percentage of Sales     3.5 %   3.4 %       3.5 %   3.5 %                                         The sales increases in both the quarter and fiscal year comparisons are the result of growth in comparable sales to the commissaries in addition to increased product line offerings. Military segment EBITDA and EBITDA as a percent of sales in the fourth quarter and fiscal year comparisons increased as a result of sales growth and a slightly improved gross margin. Retail Results                               (dollars in millions)   4th Quarter   4th Quarter   %   Fiscal   Fiscal   %     2007   2006   Change   2007   2006   Change Sales $ 134.9 144.1 (6.4 %) 591.7 648.9 (8.8 %) Segment EBITDA1 $ 4.0 6.2 (35.8 %) 27.5 30.6 (9.9 %) Percentage of Sales     3.0 %   4.3 %       4.7 %   4.7 %                                         The sales decreases in the fourth quarter and fiscal year comparisons reflect the sale or closure of retail stores, as well as declines in same store sales of 1.2% and 0.8% in the fourth quarter and fiscal year comparisons, respectively. Retail segment EBITDA was adversely impacted in the fourth quarter by a $2.6 million adjustment to retail promotional markdowns. Strategic Plan Update During the November 2007 earnings call, we provided an update on our strategic plan, Operation Fresh Start, which is designed to provide a strong platform to support a variety of growth initiatives. The strategic plan includes the following key components: differentiated retail formats, world class perishable capabilities, the rollout of our Center Store Program, an unparalleled focus on independent customers, and continued growth of our Military distribution business. "In fiscal 2007, we stabilized and restored financial vitality to our business”, said Alec Covington. "Our Company is now well positioned to invest in our strategic plan. During 2008, we will carefully invest up to $25 million in our strategic initiatives, with a total capital expenditure budget of $50 million. The remaining free cash flow will be used to pay down debt, opportunistically repurchase shares and fund acquisitions.” Financial Target Progress The following table charts the Company’s progress towards its long-term financial targets that are anticipated to be attained through successful execution of the strategic plan. Substantial improvement has been achieved in 2007 relative to fiscal 2006 results towards three of the four targets, namely, consolidated EBITDA margin, the ratio of free cash flow to net assets, and total leverage ratio. The Company expects to make improvements on the organic revenue growth metric as we implement initiatives associated with our strategic plan and as we cycle the sales lost from a large customer.                           Financial Objectives   Long-term   4th Qtr   Fiscal   Fiscal     Target   2007   2007   2006 Organic Revenue Growth 2.0 % (2.7 %) (2.1 %) (2.9 %) Consolidated EBITDA Margin 4.0 % 2.8 % 2.8 % 2.2 % Trailing Four Quarter Free Cash Flow2 / Net Assets 10.0 % 9.2 % 9.2 % 8.7 % Total Leverage Ratio (Total Debt / Trailing Four Quarter Consolidated EBITDA)   2.5-3.0  x   2.42  x   2.42  x   3.42  x                           2Defined as cash provided from operations less capital expenditures for property, plant & equipment during the trailing four quarters. Liquidity During fiscal 2007, the Company repaid $35.0 million of debt on its senior credit facilities. The Company continues to focus on effectively managing its working capital, reducing indebtedness and improving cash flow and is currently in compliance with all of its debt covenants. The total leverage ratio as of the end of fiscal year 2007 was 2.42, a significant improvement from 3.42 at the end of fiscal 2006. Availability on the Company’s revolving credit facility at the end of the quarter was $102.6 million. Share Repurchase Program As previously announced, the Board of Directors authorized a share repurchase program for the Company to purchase up to one million shares of the Company’s common stock. The program took effect on November 19, 2007 and will continue until January 3, 2009. During the fourth quarter of 2007 the Company repurchased 0.4 million shares in the open market for $15.0 million dollars at an average price per share of $36.27. Other Matters The Board of Directors has determined that the Company should reduce the size of its Board of Directors. The Company will present, and recommend that Shareholders support, a proposal to amend the Company’s Charter at the 2008 annual meeting of shareholders to set the minimum Board size at seven, and the maximum size at twelve. This proposal will reduce the overall costs to our shareholders for Board expenses and will permit the Board to effectively and efficiently discharge its responsibilities in a more cost efficient manner. A conference call to review the fiscal 2007 results is scheduled for 10 a.m. (CT) on February 28, 2008. Interested participants can listen to the conference call over the Internet by logging onto the "Investor Relations” portion of Nash Finch's website at http://www.nashfinch.com. A replay of the webcast will be available and the transcript of the call will be archived on the "Investor Relations” portion of Nash Finch's website under the heading "Audio Archives.” A copy of this press release and the other financial and statistical information about the periods to be discussed in the conference call will be available at the time of the call on the "Investor Relations” portion of the Nash Finch website under the caption "Press Releases.” Nash Finch Company is a Fortune 500 company and one of the leading food distribution companies in the United States. Nash Finch’s core business, food distribution, serves independent retailers and military commissaries in 31 states, the District of Columbia, Europe, Cuba, Puerto Rico, the Azores and Egypt. The Company also owns and operates a base of retail stores, primarily supermarkets under the Econofoods®, Family Thrift Center® and Sun Mart® trade names. Further information is available on the Company's website at www.nashfinch.com. This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such statements relate to trends and events that may affect our future financial position and operating results. Any statement contained in this release that are not statements of historical fact may be deemed forward-looking statements. For example, words such as "may,” "will,” "should,” "likely,” "expect,” "anticipate,” "estimate,” "believe,” "intend, ” "potential” or "plan,” or comparable terminology, are intended to identify forward-looking statements. Such statements are based upon current expectations, estimates and assumptions, and entail various risks and uncertainties that could cause actual results to differ materially from those expressed in such forward-looking statements. Important factors known to us that could cause or contribute to material differences include, but are not limited to, the following: the effect of competition on our distribution, military and retail businesses; general sensitivity to economic conditions, including volatility in energy prices, food commodities, and changes in market interest rates; our ability to identify and execute plans to improve the competitive position of our retail operations; our ability to identify and execute plans to expand our food distribution, military and retail operations; possible changes in the military commissary system, including those stemming from the redeployment of forces, congressional action and funding levels; the success or failure of strategic plans, new business ventures or initiatives; changes in consumer spending or buying patterns; risks entailed by future acquisitions, including the ability to successfully integrate acquired operations and retain the customers of those operations; changes in credit risk from financial accommodations extended to new or existing customers; significant changes in the nature of vendor promotional programs and the allocation of funds among the programs; limitations on financial and operating flexibility due to debt levels and debt instrument covenants; legal, governmental or administrative proceedings and/or disputes that result in adverse outcomes, such as adverse determinations or developments with respect to the litigation or SEC inquiry discussed in Part I, Item 3 of our Annual Report on Form 10-K for the fiscal year ended December 30, 2006; technology failures which have a material adverse effect on our business; severe weather and natural disasters adversely impacting our supply chain; changes in health care, pension and wage costs, and labor relations issues; threats or potential threats to security or food safety; and unanticipated problems with product procurement. A more detailed discussion of many of these factors, as well as other factors that could affect the Company’s results, is contained in the Company’s periodic reports filed with the SEC. You should carefully consider each of these factors and all of the other information in this release. We believe that all forward-looking statements are based upon reasonable assumptions when made. However, we caution that it is impossible to predict actual results or outcomes and that accordingly you should not place undue reliance on these statements. Forward-looking statements speak only as of the date when made and we undertake no obligation to revise or update these statements in light of subsequent events or developments. Actual results and outcomes may differ materially from anticipated results or outcomes discussed in forward-looking statements. You are advised, however, to consult any future disclosures we make on related subjects in future reports to the Securities and Exchange Commission (SEC) 1 Consolidated EBITDA, as defined in our credit agreement, is earnings before interest, income tax, depreciation and amortization, adjusted to exclude extraordinary gains or losses, gains or losses from sales of assets other than inventory in the ordinary course of business, and non-cash charges (such as LIFO, asset impairments, closed store lease costs and share-based compensation), less cash payments made during the current period on non-cash charges recorded in prior periods. Consolidated EBITDA should not be considered an alternative measure of our net income, operating performance, cash flows or liquidity. The amount of consolidated EBITDA is provided as additional information relevant to compliance with our debt covenants. NASH FINCH COMPANY AND SUBSIDIARIES Consolidated Statements of Income (In thousands, except per share amounts)             Twelve Fifty Two Weeks Ended Weeks Ended December 29, December 30, December 29, December 30, 2007 2006 2007 2006   Sales $ 1,069,302 1,099,139 $ 4,532,635 4,631,629 Cost of sales 979,836   1,006,047   4,134,981   4,229,807   Gross Profit 89,466 93,092 397,654 401,822   Other costs and expenses: Selling, general and administrative 64,326 75,891 280,818 319,678 Losses (gains) on sale of real estate (1,720 ) 37 (1,867 ) (1,130 ) Special charges - - (1,282 ) 6,253 Goodwill impairment - 26,419 - 26,419 Depreciation and amortization 8,997 9,447 38,882 41,451 Interest expense 5,367   6,551   23,581   26,644   Total other costs and expenses 76,970 118,345 340,132 419,315   Earnings (loss) from continuing operations before income taxes and cumulative effect of a change in accounting principal 12,496 (25,253 ) 57,522 (17,493 )   Income tax expense 4,016   1,275   18,742   5,835     Earnings (loss) from continuing operations before cumulative effect of a change in accounting principal 8,480 (26,528 ) 38,780 (23,328 )   Earnings from discontinued operations, net of income tax expense of $102 in 2006 - 160 - 160 Cumulative effect of a change in accounting principle, net of income tax expense of $119 in 2006 -   -   -   169   Net earnings (loss) $ 8,480   (26,368 ) $ 38,780   (22,999 )   Net earnings (loss) per share:   Basic earnings per share: Continuing operations before cumulative effect of a change in accounting principle $ 0.63 (1.97 ) $ 2.88 (1.74 ) Discontinued operations, net of income tax expense - - - 0.01 Cumulative effect of a change in accounting principle, net of income tax expense -   0.01   -   0.01   Net earnings (loss) per share $ 0.63   (1.96 ) $ 2.88   (1.72 )   Diluted earnings per share: Continuing operations before cumulative effect of a change in accounting principle $ 0.62 (1.97 ) $ 2.84 (1.74 ) Discontinued operations, net of income tax expense - - - 0.01 Cumulative effect of a change in accounting principle, net of income tax expense -   0.01   -   0.01   Net earnings (loss) per share $ 0.62   (1.96 ) $ 2.84   (1.72 )   Cash dividends per common share $ 0.180 0.180 $ 0.720 0.720   Weighted average number of common shares outstanding and common equivalent shares outstanding: Basic 13,442 13,427 13,465 13,382 Diluted 13,701 13,427 13,655 13,382 NASH FINCH COMPANY AND SUBSIDIARIES Consolidated Balance Sheets (In thousands, except per share amounts)           Assets December 29,2007 December 30,2006 Current assets: Cash and cash equivalents $ 862 958 Accounts and notes receivable, net 197,807 186,833 Inventories 246,762 241,875 Prepaid expenses and other 27,882 15,445 Deferred tax assets 4,621   11,942   Total current assets 477,934 457,053   Notes receivable, net 12,429 13,167   Property, plant and equipment: 617,241 620,555 Less accumulated depreciation and amortization (414,704 ) (400,750 ) Net property, plant and equipment 202,537 219,805   Goodwill 215,174 215,174 Customer contracts and relationships, net 28,368 32,141 Investment in direct financing leases 4,969 6,143 Other assets 9,971   10,820   Total assets $ 951,382   954,303     Liabilities and Stockholders' Equity Current liabilities: Outstanding checks $ 8,895 13,335 Current maturities of long-term debt and capitalized lease obligations 3,842 3,776 Accounts payable 200,507 196,168 Accrued expenses 69,113 64,747 Income taxes payable -   196   Total current liabilities 282,357 278,222   Long-term debt 278,443 313,985 Capitalized lease obligations 29,885 33,869 Deferred tax liability, net 7,227 4,214 Other liabilities 37,854 29,633 Commitments and contingencies - - Stockholders' equity: Preferred stock - no par value. Authorized 500 shares; none issued - - Common stock of $1.66 2/3 par value Authorized 50,000 shares, issued 13,559 and 13,409 shares respectively 22,599 22,348 Additional paid-in capital 61,446 53,697 Restricted stock - - Common stock held in trust (2,122 ) (2,051 ) Deferred compensation obligations 2,122 2,051 Accumulated other comprehensive income (5,092 ) (4,582 ) Retained earnings 252,142 223,416 Treasury stock at cost, 434 and 21 shares, respectively (15,479 ) (499 ) Total stockholders' equity 315,616   294,380   Total liabilities and stockholders' equity $ 951,382   954,303   NASH FINCH COMPANY AND SUBSIDIARIES Consolidated Statements of Cash Flows (In thousands)             Fifty Two Weeks Ended December 29, December 30, 2007 2006 Operating activities: Net earnings (loss) $ 38,780 (22,999 ) Adjustments to reconcile net earnings (loss) to net cash provided by operating activities:   Special charges -- non cash portion (1,282 ) 6,253 Impairment of retail goodwill - 26,419 Discontinued operations - (262 ) Depreciation and amortization 38,882 41,451 Amortization of deferred financing costs 817 823 Rebatable loans 2,200 3,926 Provision for bad debts 1,234 5,600 Provision for lease reserves 551 7,042 Deferred income tax expense 26,830 3,417 Gain on sale of real estate and other (2,371 ) (1,881 ) LIFO charge 5,092 2,630 Asset impairments 1,869 11,443 Share-based compensation 7,786 1,166 Cumulative effect of a change in accounting principle - (288 ) Deferred compensation 734 (226 ) Other 20 (1,192 ) Changes in operating assets and liabilities, net of effects of acquisitions Accounts and notes receivable (11,246 ) 5,889 Inventories (9,979 ) 44,619 Prepaid expenses 2,813 3,128 Accounts payable 1,924 (21,729 ) Accrued expenses 1,782 (10,564 ) Income taxes payable (9,213 ) (10,536 ) Other assets and liabilities (13,607 ) (3,994 ) Net cash provided by operating activities 83,616   90,135     Investing activities: Disposal of property, plant and equipment 4,978 6,333 Additions to property, plant and equipment (21,419 ) (27,469 ) Loans to customers (3,856 ) (5,767 ) Payments from customers on loans 1,854 2,165 Purchase of marketable securities - (233 ) Sale of marketable securities 2 921 Corporate owned life insurance, net (46 ) (320 ) Other -   (139 ) Net cash used in investing activities (18,487 ) (24,509 ) Financing activities: Proceeds (payments) of revolving debt (35,000 ) (41,600 ) Dividends paid (9,702 ) (9,611 ) Proceeds from exercise of stock options 2,002 680 Proceeds from employee stock purchase plan 498 502 Repurchase of common stock (14,980 ) - Payments of long-term debt (626 ) (16,104 ) Payments of capitalized lease obligations (3,834 ) (2,901 ) Increase (decrease) in outstanding checks (4,441 ) 2,549 Tax benefit from exercise of stock options 857 68 Other 1   492   Net cash used by financing activities (65,225 ) (65,925 ) Net decrease in cash and cash equivalents (96 ) (299 ) Cash and cash equivalents: Beginning of period 958   1,257   End of period $ 862   958   NASH FINCH COMPANY AND SUBSIDIARIES Supplemental Data (Unaudited)             Twelve Twelve Fifty Two Fifty Two Weeks Ended Weeks Ended Weeks Ended Weeks Ended December 29, December 30, December 29, December 30, Other Data (In thousands) 2007 2006 2007 2006   Total debt $ 312,170 351,630 312,170 351,630 Stockholders' equity $ 315,616 294,380 315,616 294,380 Capitalization $ 627,786 646,010 627,786 646,010 Debt to total capitalization 49.7 % 54.4 % 49.7 % 54.4 % Working capital ratio (a) 3.56 2.71 3.56 2.71     Non-GAAP Data Consolidated EBITDA (b) $ 30,229 23,920 128,840 102,730 Interest coverage ratio - trailing 4 qtrs. (Consolidated EBITDA to interest expense) (c) 5.61 3.95 5.61 3.95 Leverage ratio - trailing 4 qtrs. (debt to Consolidated EBITDA) (d) 2.42 3.42 2.42 3.42 Senior secured leverage ratio (senior secured debt to Consolidated EBITDA) (e) 0.97 1.56 0.97 1.56     Comparable GAAP Data Earnings before income taxes to interest expense (c) $ 2.33 (0.67 ) 2.33 (0.67 ) Debt to earnings before income taxes (d) 5.43 (20.10 ) 5.43 (20.10 ) Senior secured debt to earnings before income taxes (e) 10.00 (9.15 ) 10.00 (9.15 )   Debt Covenants Required Ratio Actual Ratio Working capital ratio 1.75 (minimum) 3.56 Interest coverage ratio 4.00 (minimum) 5.61 Senior secured leverage ratio 2.25 (maximum) 0.97 Leverage ratio 3.00 (maximum) 2.42 (a)   Working capital ratio is defined as net trade accounts receivable plus inventory divided by the sum of loans and letters of credit outstanding under our senior secured credit agreement plus certain additional secured debt.   (b) Consolidated EBITDA, as defined in our credit agreement, is earnings before interest, income tax, depreciation and amortization, adjusted to exclude extraordinary gains or losses, gains or losses from sales of assets other than inventory in the ordinary course of business, and non-cash charges (such as LIFO, asset impairments, closed store lease costs and share-based compensation), less cash payments made during the current period on non-cash charges recorded in prior periods. Consolidated EBITDA should not be considered an alternative measure of our net income, operating performance, cash flows or liquidity. The amount of consolidated EBITDA is provided as additional information relevant to compliance with our debt covenants.   (c) Interest coverage ratio is defined as the Company's Consolidated EBITDA divided by interest expense for the four trailing quarters ending December 29, 2007 and December 30, 2006, respectively. The most comparable GAAP ratio is earnings from continuing operations before income taxes divided by interest expense for the same periods.   (d) Leverage ratio is defined as the Company's total debt at December 29, 2007 and December 30, 2006, divided by Consolidated EBITDA for the respective four trailing quarters. The most comparable GAAP ratio is debt at the same date divided by earnings from continuing operations before income taxes for the respective four quarters   (e) Senior secured leverage ratio is defined as total senior secured debt at December 29, 2007 and December 30, 2006 divided by Consolidated EBITDA for the respective four trailing quarters. The most comparable GAAP ration is the total senior secured debt at the same date divided by earnings from continuing operations before income taxes for the respective four trailing quarters Derivation of Consolidated EBITDA; Segment Consolidated EBITDA; and Segment Profit (in thousands)                     FY 2007 2007 2007 2007 2007 Rolling Qtr 1 Qtr 2 Qtr 3 Qtr 4 4 Qtrs Earnings (loss) from continuing operations before income taxes $ 9,485 17,304 18,237 12,496 57,522   Add/(deduct) Interest expense 5,595 5,671 6,948 5,367 23,581 Depreciation and amortization 9,082 8,901 11,902 8,997 38,882 LIFO 808 807 1,077 2,399 5,091 Lease reserves (888 ) 825 614 - 551 Asset impairments 866 275 640 87 1,868 Gains on sale of real estate - (147 ) - (1,720 ) (1,867 ) Subsequent cash payments on non-cash charges (700 ) (663 ) (918 ) (1,011 ) (3,292 ) Share-based compensation(b) 956 1,584 1,632 3,614 7,786 Special charges -   (1,282 ) -   -   (1,282 ) Total Consolidated EBITDA $ 25,204   33,275   40,132   30,229   128,840       2007 2007 2007 2007 Rolling Segment Consolidated EBITDA Qtr 1 Qtr 2 Qtr 3 Qtr 4 4 Qtrs Food Distribution $ 20,637 23,715 31,750 26,143 102,245 Military 9,892 10,602 13,000 10,545 44,039 Retail 6,784 8,857 7,905 4,000 27,546 Unallocated Corporate Overhead (12,109 ) (9,899 ) (12,523 ) (10,459 ) (44,990 ) $ 25,204   33,275   40,132   30,229   128,840       2007 2007 2007 2007 Rolling Segment profit Qtr 1 Qtr 2 Qtr 3 Qtr 4 4 Qtrs Food Distribution $ 18,180 21,343 28,601 23,796 91,920 Military 9,472 10,170 12,406 10,067 42,115 Retail 4,821 6,818 5,096 1,902 18,637 Unallocated Corporate Overhead (22,988 ) (21,027 ) (27,866 ) (23,268 ) (95,149 ) $ 9,485   17,304   18,237   12,497   57,523           FY 2006   2006 2006 2006 2006 Rolling Qtr 1 Qtr 2 Qtr 3 Qtr 4 4 Qtrs Earnings from continuing operations before income taxes $ 6,314 7,733 (6,287 ) (25,253 ) (17,493 ) Add/(deduct) Interest expense 6,067 6,120 7,906 6,551 26,644 Depreciation and amortization 9,702 9,617 12,685 9,447 41,451 LIFO 462 461 1,590 117 2,630 Closed store lease costs 902 1,327 4,455 2,675 9,359 Asset impairments 1,547 3,247 2,522 4,127 11,443 Losses (gains) on sale of real estate 33 (1,225 ) 25 37 (1,130 ) Subsequent cash payments on non-cash charges (808 ) (656 ) (1,862 ) (686 ) (4,012 ) Goodwill impairment - - - 26,419 26,419 Share-based compensation(b) (187 ) 634 233 486 1,166 Special charges -   -   6,253   -   6,253   Total Consolidated EBITDA $ 24,032   27,258   27,520   23,920   102,730       2006 2006 2006 2006 Rolling Segment Consolidated EBITDA after reclass of bad debt expense (a) Qtr 1 Qtr 2 Qtr 3 Qtr 4 4 Qtrs Food Distribution $ 20,352 20,089 26,030 20,234 86,705 Military 9,173 10,295 11,850 9,941 41,259 Retail 6,743 8,965 8,633 6,227 30,568 Unallocated Corporate Overhead (12,236 ) (12,091 ) (18,993 ) (12,482 ) (55,802 ) $ 24,032   27,258   27,520   23,920   102,730       2006 2006 2006 2006 Rolling Segment profit after reclass of bad debt expense (a) Qtr 1 Qtr 2 Qtr 3 Qtr 4 4 Qtrs Food Distribution $ 17,841 17,584 22,689 17,676 75,790 Military 8,747 11,011 11,283 9,485 40,526 Retail 4,272 6,600 5,645 4,296 20,813 Unallocated Corporate Overhead (24,546 ) (27,462 ) (45,904 ) (56,710 ) (154,622 ) $ 6,314   7,733   (6,287 ) (25,253 ) (17,493 ) (a)   Segment information prior to fourth quarter fiscal 2005 reflects a reclassification of bad debt expense from Unallocated Corporate Overhead to the Food Distribution   (b) The calculation of EBITDA has been revised for all periods presented to include an adjustment for non-cash share-based compensation.