Revenue during the quarter grew 3.78 percent to $918.79 million from $885.30 million in the previous year period. Gross margin for the quarter expanded 53 basis points over the previous year period to 48.11 percent. Total expenses were 92.80 percent of quarterly revenues, up from 92.12 percent for the same period last year. That has resulted in a contraction of 68 basis points in operating margin to 7.20 percent.

Operating income for the quarter was $66.13 million, compared with $69.75 million in the previous year period.

However, the adjusted EBITDA for the quarter stood at $101.74 million compared with $104.90 million in the prior year period. At the same time, adjusted EBITDA margin contracted 78 basis points in the quarter to 11.07 percent from 11.85 percent in the last year period.

"While we are pleased with the performance of Dave's Killer Bread, which continues to gain share as America's #1 organic bread brand, our results in the third quarter were affected by challenging category dynamics and elevated marketing and legal costs," Allen Shiver, Flowers Foods president and CEO, said. "We remain acutely focused on driving growth and increasing efficiencies, including our Project Centennial efforts. The initial diagnostic phase is complete, and we are now finalizing our plans to implement strategies intended to grow sales and improve margins. Today, Flowers is a strong company with a team dedicated to excellence. Looking ahead, we are confident we are taking the right steps to build on our strong foundation and enhance shareholder value over the long term."

For financial year 2016, the company projects diluted earnings per share to be in the range of $0.88 to $0.93. For financial year 2016, the company projects diluted earnings per share to be in the range of $0.90 to $0.95 on adjusted basis.

The company has spent $57.25 million cash to meet investing activities during the nine month period as against cash outgo of $333.10 million in the last year period.

The company has spent $234.60 million cash to carry out financing activities during the nine month period as against cash inflow of $53.81 million in the last year period.

Cash and cash equivalents stood at $7.54 million as on Oct. 08, 2016, down 14.18 percent or $1.24 million from $8.78 million on Oct. 10, 2015.

Working capital increases marginally
Flowers Foods, Inc. has recorded an increase in the working capital over the last year. It stood at $137.60 million as at Oct. 08, 2016, up 4.75 percent or $6.24 million from $131.36 million on Oct. 10, 2015. Current ratio was at 1.41 as on Oct. 08, 2016, up from 1.34 on Oct. 10, 2015.

Days sales outstanding went down to 12 days for the quarter compared with 25 days for the same period last year.

Debt moves up 
Flowers Foods, Inc has witnessed an increase in total debt over the last one year. It stood at $991.83 million as on Oct. 08, 2016, up 10.56 percent or $94.72 million from $897.11 million on Oct. 10, 2015. Total debt was 35.30 percent of total assets as on Oct. 08, 2016, compared with 32.60 percent on Oct. 10, 2015. Debt to equity ratio was at 0.84 as on Oct. 08, 2016, up from 0.73 as on Oct. 10, 2015. Interest coverage ratio deteriorated to 14.12 for the quarter from 79.44 for the same period last year.