Del Monte Foods Company Reports Fiscal 2006 Third Quarter

Announcement Highlights

-- Q3 net sales increased 2.0% year-over-year, driven primarily by successful pricing actions and new products

-- Diluted EPS from continuing operations was $0.26 in Q3F06 compared to $0.23 (including $0.01 integration expense) in Q3F05

-- The Company continued to experience increased inflationary and other costs

-- The Company also announced two major milestones as it executes against Project Brand - the acquisition of Meow Mix Holdings, Inc. ("Meow Mix") and the divestiture of private label soup and infant feeding businesses

Del Monte Foods Third Quarter Results

Del Monte Foods Company today reported income from continuingoperations of $52.0 million and diluted earnings per share of $0.26for the third quarter ended January 29, 2006, compared to income fromcontinuing operations of $48.6 million and $0.23 per diluted share forthe prior year period, including $0.01 of integration expense.

Third quarter net sales of $878.5 million increased 2.0% fromprior year period net sales of $861.3 million. The increase in netsales was driven primarily by increased pricing and volume growth fromnew products. These gains were partially offset by lower volume inlarge part reflecting volume loss associated with price increases(elasticity) which was in the expected range.

Del Monte's year-over-year third quarter earnings increase wasdriven by this solid top-line performance, as well as by severalcombined factors, including lower interest expense, the absence ofintegration expense, lower overhead expenses and the benefits from theshare repurchase program, partially offset by increased steel, energy,logistics and other transportation-related costs.

"We are pleased with our third quarter results, which reflectcontinued execution of our brand-focused strategic plan. Positivepricing and new product introductions, both enabled by our strongbrands, drove solid, top-line growth," said Richard G. Wolford,Chairman and CEO of Del Monte Foods. "While, steel, energy andtransportation cost increases continue to pressure margins, goingforward we believe that focused execution on our strategic plan willhelp us combat these inflationary costs and deliver increased value toshareholders."

"Importantly, the acquisition of Meow Mix and the sale of ourprivate label soup and infant feeding businesses, which we alsoannounced today, are two key milestones in our execution of ProjectBrand," continued Mr. Wolford. "These two transactions represent majorsteps in Del Monte's strategic commitment to expand its portfolio ofhigher margin businesses in fast growing categories with leadingbrands that can support ongoing innovation. Together, thesetransactions will enhance the margin and growth potential of theentire Company and catapult us toward our goal of creating a morevalue-added, branded consumer packaged food company."

Consumer Products

For the third quarter, Consumer Products net sales were $651.2million, an increase of 2.0% over net sales of $638.3 million in theprior year period. The increase was driven primarily by higherpricing, as well as volume growth from new products including StarKistTuna Fillets. These gains were partially offset by lower volume inlarge part reflecting expected volume loss associated with priceincreases.

Consumer Products operating income decreased 5.4% from $74.2million in third quarter fiscal 2005 to $70.2 million in third quarterfiscal 2006, as the increase in sales was more than offset byincreased steel, energy, logistics and other transportation-relatedcosts.

Pet Products

For the third quarter, Pet Products net sales were $227.3 million,an increase of 1.9% over net sales of $223.0 million in the prior yearperiod. The increase was driven primarily by increased volume from newproducts in the pet snacks and dry dog businesses, including Kibbles'n Bits Homestyle Beef and Meaty Bone Denta Delicious. The positivenew product growth was partially offset by the expected decrease involume when compared to higher prior year 9Lives restage promotedvolume.

Pet Products operating income increased 22.5% from $37.8 millionin third quarter fiscal 2005 to $46.3 million in third quarter fiscal2006. The increase was driven by lower SG&A, reflecting the absence ofprior year litigation expense and lower year-over-year marketingexpense, largely reflecting the absence of the prior year period's9Lives restage investment. This SG&A reduction was partially offset byhigher customer delivery costs.

Del Monte Foods Nine Months Ended January 29, 2006 Results

The Company reported income from continuing operations of $111.0million and diluted earnings per share of $0.54 for the nine monthsended January 29, 2006, compared to income from continuing operationsof $99.0 million and $0.47 per diluted share for the prior yearperiod, including $0.05 of integration expense.

Net sales for the nine months ended January 29, 2006 increased4.2% from prior year period net sales of $2,333.9 million to $2,431.9million. The increase in net sales was driven primarily by increasedpricing partially offset by lower volume, as volume loss associatedwith price increases slightly offset positive new and existing productvolume.

Del Monte's year-over-year earnings increase for the nine monthsended January 29, 2006 was driven primarily by the positive top-lineperformance, offset by increased steel, energy, logistics and othertransportation-related costs, higher fish costs and increased SG&A.The absence of integration expense, lower interest expense and thebenefits from the share repurchase program also contributed to higherearnings per share.

Outlook

For fiscal 2006, the Company expects to deliver sales growth aboveits previously announced 1 to 3% sales growth guidance range.Additionally, the Company continues to anticipate delivering full-yearfiscal 2006 earnings per share at the low end of its original $0.75 to$0.80 guidance, which includes estimated earnings per share of $0.09from the private label soup and infant feeding businesses which willbe reported as discontinued operations. The Company also anticipates asmall, one-time gain from the sale of infant feeding and private labelsoup businesses. On a continuing operations basis, the Company expectsto deliver earnings per share of $0.66 to $0.71.

The Company continues to expect cash provided by operatingactivities, less cash used in investing activities, of approximately$190 to $200 million.

Fiscal 2005 net sales were $3,180.9 million. The Company reporteddiluted earnings per share of $0.56 and earnings per share fromcontinuing operations of $0.56 for fiscal 2005, which included $0.07of integration expense, $0.10 of refinancing expense and $0.02 oflitigation expenses.

For the fiscal 2006 fourth quarter, the Company expects to deliversales growth of approximately 1 to 3% over net sales of $847.0 millionin the fourth quarter of fiscal 2005. Including both continued anddiscontinued operations, diluted earnings per share is expected to beapproximately $0.18 to $0.23. The Company reported diluted earningsper share of $0.09 from continuing operations for the fourth quarterof fiscal 2005, which included $0.03 of integration expense, $0.10 ofrefinancing expense and $0.01 of litigation expenses.

Del Monte Foods

Del Monte Foods is one of the country's largest and most wellknown producers, distributors and marketers of premium quality,branded and private label food and pet products for the U.S. retailmarket, generating over $3 billion in net sales in fiscal 2005. With apowerful portfolio of brands including Del Monte(R), Contadina(R),StarKist(R), S&W(R), College Inn(R), 9Lives(R), Kibbles 'n Bits(R),Pup-Peroni(R), Snausages(R), Pounce(R) and Meaty Bone(R), Del Monteproducts are found in nine out of ten American households. For moreinformation on Del Monte Foods Company (NYSE:DLM), visit the Company'swebsite at www.delmonte.com.

Del Monte Foods will host a live audio webcast, accompanied by aslide presentation, to discuss its fiscal 2006 third quarter at 8:00a.m. PT (11:00 a.m. ET) today. The webcast slide presentation andhistorical, quarterly results can be accessed atwww.delmonte.com/Company/investors. The audio portion of the webcastmay also be accessed during the call (listen-only mode) as follows: 1-877-709-5341 (1-517-308-9005 outside the U.S. and Canada), verbalcode: Del Monte Foods. The web cast and slide presentation will beavailable online following the presentation.

This press release contains forward-looking statements conveyingmanagement's expectations as to the future based on plans, estimatesand projections at the time the Company makes the statements.Forward-looking statements involve inherent risks and uncertaintiesand the Company cautions you that a number of important factors couldcause actual results to differ materially from those contained in anysuch forward-looking statement. The forward-looking statementscontained in this press release include statements related to futurefinancial operating results and business plans as well as the plannedacquisition and sale announced separately today.

Factors that could cause actual results to differ materially fromthose described in this press release include, among others: generaleconomic and business conditions; cost and availability ofcommodities, ingredients and other raw materials, including withoutlimitation, steel, energy, fuel, grains, meat by-products and tuna;logistics and other transportation-related costs; ability to increaseprices and reduce costs; our debt levels and ability to service ourdebt; costs and results of efforts to improve the performance andmarket share of our businesses; reduced sales, disruptions, costs orother charges to earnings that may be generated by our strategic plan,including related disposition efforts; acquisitions, if any, includingidentification of appropriate targets and successful integration ofany acquired business; matters that may effect the disposition of theprivate label soup and infant feeding businesses, the acquisition ofMeow Mix Holdings, Inc. or the impact of such transactions, includingas described in today's release relating to such transactions;effectiveness of marketing, pricing and trade promotion programs;changing consumer and pet preferences; timely launch and marketacceptance of new products; competition, including pricing andpromotional spending levels by competitors; product liability claims;weather conditions; crop yields; changes in U.S., foreign or local taxlaws and effective rates; interest rate fluctuations; the loss ofsignificant customers or a substantial reduction in orders from thesecustomers or the bankruptcy of any such customer; changes in businessstrategy or development plans; availability, terms and deployment ofcapital; dependence on co-packers, some of whom may be competitors orsole-source suppliers; changes in, or the failure or inability tocomply with, U.S., foreign and local governmental regulations,including environmental regulations; litigation; industry trends,including changes in buying, inventory and other business practices bycustomers; public safety and health issues; and other factors.

These factors and other risks and uncertainties are described inmore detail, from time to time, in the Company's filings with theSecurities and Exchange Commission, including its annual report onForm 10-K. Investors are cautioned not to place undue reliance onthese forward-looking statements, which speak only as of the datehereof. The Company does not undertake to update any of thesestatements in light of new information or future events.
Del Monte Foods Company - Selected Financial Information

Net Sales by Segment
(In millions)

Three Months Ended Nine Months Ended
----------------------- -----------------------
January 29, January 30, January 29, January 30,
Net Sales: 2006 2005 2006 2005
----------- ----------- ----------- -----------
Consumer Products $ 651.2 $ 638.3 $ 1,801.4 $ 1,714.4
Pet Products 227.3 223.0 630.5 619.5
----------- ----------- ----------- -----------
Total company $ 878.5 $ 861.3 $ 2,431.9 $ 2,333.9
=========== =========== =========== ===========


Operating Income by Segment
(In millions)

Three Months Ended Nine Months Ended
----------------------- -----------------------
January 29, January 30, January 29, January 30,
Operating Income: 2006 2005 2006 2005
----------- ----------- ----------- -----------
Consumer Products $ 70.2 $ 74.2 $ 176.8 $ 183.3
Pet Products 46.3 37.8 103.1 86.1
Corporate (a) (12.5) (7.6) (36.1) (30.8)
----------- ----------- ----------- -----------
Total company $ 104.0 $ 104.4 $ 243.8 $ 238.6
=========== =========== =========== ===========


(a) Corporate represents expenses not directly attributable to
reportable segments.


Selected Balance Sheet Data
(In millions) As of
-----------------------
January 29, May 1,
2006 2005
----------- -----------

Cash and cash equivalents $ 94.6 $ 145.9
Trade accounts receivable, net of
allowance 218.2 212.6
Inventories 1,024.6 825.1
Total assets 3,630.6 3,530.6
Accounts payable and accrued
expenses 462.8 387.3
Short-term borrowings 1.8 1.0
Long-term debt, including current
portion 1,305.0 1,306.1
Stockholders' equity 1,246.5 1,260.6




Selected Cash Flow Data
(In millions) Nine Months Ended
-----------------------
January 29, January 30,
2006 2005
----------- -----------

Net cash provided by (used in)
operating activities $ 86.5 $ (5.8)

Net cash used in investing
activities (13.1) (41.2)
----------- -----------

Total 73.4 (47.0)

Net cash provided by (used in)
financing activities (124.0) 17.4

Depreciation and amortization 70.9 68.2



Other Financial Data
(In millions) As of
-----------------------------------
January 29, May 1, January 30,
2006 2005 2005
----------- ----------- -----------

Short-term borrowings $ 1.8 $ 1.0 $ 14.9
Current portion of long-term debt 10.1 1.7 6.3
Long-term debt (excluding current
portion) 1,294.9 1,304.4 1,363.9
----------- ----------- -----------

Total Debt 1,306.8 1,307.1 1,385.1
----------- ----------- -----------

Cash and cash equivalents 94.6 145.9 8.6
----------- ----------- -----------
Total Debt Net of Cash $ 1,212.2 $ 1,161.2 $ 1,376.5
=========== =========== ===========


DEL MONTE FOODS COMPANY
Consolidated Statements of Income
(In millions, except share and per share data)


Three Months Ended Nine Months Ended
--------------------------- ---------------------------
January 29, January 30, January 29, January 30,
2006 2005 2006 2005
------------- ------------- ------------- -------------

Net sales $ 878.5 $ 861.3 $ 2,431.9 $ 2,333.9
Cost of
products sold 638.3 629.1 1,798.4 1,732.5
------------- ------------- ------------- -------------
Gross profit 240.2 232.2 633.5 601.4
Selling,
general and
administrative
expense 136.2 127.8 389.7 362.8
------------- ------------- ------------- -------------
Operating
income 104.0 104.4 243.8 238.6
Interest
expense 22.7 25.9 66.8 76.4
Other expense
(income) (0.1) 0.1 1.0 2.6
------------- ------------- ------------- -------------
Income from
continuing
operations
before
income
taxes 81.4 78.4 176.0 159.6
Provision for
income taxes 29.4 29.8 65.0 60.6
------------- ------------- ------------- -------------
Income from
continuing
operations 52.0 48.6 111.0 99.0

Income (loss)
from
discontinued
operations
before
income
taxes (0.2) - 1.2 (0.7)
Provision
(benefit)
for
income
taxes (0.1) 0.1 0.2 (0.3)
------------- ------------- ------------- -------------
Income (loss)
from
discontinued
operations (0.1) (0.1) 1.0 (0.4)

------------- ------------- ------------- -------------
Net income $ 51.9 $ 48.5 $ 112.0 $ 98.6
============= ============= ============= =============

Earnings per
common share
(EPS)
Basic:
Basic Average
Shares 199,719,243 210,956,990 202,345,229 210,329,324
EPS -
Continuing
Operations $ 0.26 $ 0.23 $ 0.55 $ 0.47
EPS -
Discontinued
Operations - - - -
------------- ------------- ------------- -------------
EPS - Total $ 0.26 $ 0.23 $ 0.55 $ 0.47
============= ============= ============= =============

Diluted:
Diluted
Average
Shares 201,917,511 212,708,244 204,560,130 212,155,196
EPS -
Continuing
Operations $ 0.26 $ 0.23 $ 0.54 $ 0.47
EPS -
Discontinued
Operations - - - -
------------- ------------- ------------- -------------
EPS - Total $ 0.26 $ 0.23 $ 0.54 $ 0.47
============= ============= ============= =============