HispanicBusiness

Interest

The Company's interest and other financing costs for the fourth quarter of 2012 as compared to the fourth quarter of 2011 increased by $0.3 million to $4.5 million primarily due to the issuance of $57.5 million of convertible debentures in June 2012, the proceeds of which were used to repay lower cost senior debt.

The Company's interest and other financing costs for 2012 as compared to 2011 increased by $3.1 million to $17.6 million primarily due to: (i) an increase in the Company's average outstanding net funded debt; and (ii) the issuance of $57.5 million of convertible debentures in June 2012, the proceeds of which were used to repay lower cost senior debt.

Restructuring Costs

Restructuring costs consist of costs associated with the significant restructuring of one or more of the Company's businesses. For 2012, the Company incurred $5.7 million in restructuring costs consisting of:

--  $2.5 million in costs relating to the reconfiguration of the Company's    sandwich production facilities. This initiative consists of the    following three parts: (i) the construction of a new 20,000 square foot    sandwich plant in Laval, Quebec, which was completed at the end of the    second quarter of 2012 and commenced operations in July 2012; (ii) the    transfer of the operations of the Company's leased sandwich production    facility in Edmonton, Alberta to its owned sandwich production facility    in Edmonton and the subsequent shutdown of the leased facility. This was    completed in August 2012; and (iii) the transfer of the production of    certain products from the Company's sandwich plant in Etobicoke, Ontario    to its new plant in Laval and the subsequent sale of the Etobicoke    plant's remaining operations, which consisted primarily of fresh    sandwich production. This was completed at the end of September 2012.    The project, which was effectively completed at the end of 2012, is    expected (see Forward Looking Statements) to generate the following    benefits: (i) a new state-of-the-art facility in Laval which will be    used to grow the Company's sandwich business in central and eastern    Canada; (ii) reduced plant operating overhead costs through the shutdown    of the Company's leased facility in Edmonton; (iii) improved production    efficiencies by transferring production from the less efficient    Etobicoke plant to the new Laval plant; and (iv) freight savings    associated with reconfiguring production so that sandwiches for the    central and eastern Canadian markets are made in the Laval facility    while sandwiches for the western Canadian market are produced in the    Edmonton facility.--  $1.7 million in charges relating to the restructuring of the Company's    NDSD business' DSD networks for the convenience store channel (the DSD    Restructuring Initiative). The DSD Restructuring Initiative involves the    merging and rationalization of the following three DSD networks:    a.  The Company's Direct Plus DSD network, which operates primarily in        western Canada;    b.  The DSD network acquired as part of the Deli Chef acquisition in        2011. This network operates in Ontario and Quebec; and    c.  A network of independent distributors controlled by Pridcorp. The        Company acquired Pridcorp at the end of 2011. This network operates        in various markets across Canada, including the Maritimes.--  At the end of the third quarter of 2012 the Company anticipated that the    DSD Restructuring Initiative would be completed in the first quarter of    2013 at a total cost of approximately $1.3 million. Since then the    following events have taken place:    a.  Several of NDSD's large corporate customers have, for cost savings        purposes, chosen to switch to wholesale distributors to deliver        products, including those of the Company's various businesses, to        their stores. Wholesale distribution is a discounted distribution        service that does not provide the value added services offered by        DSD networks, namely: (i) in-store merchandising; (ii) inventory        management; and (iii) part case sales. In general terms, the        additional services provided by DSD distribution usually results in        improved same store sales due to better management of a store's        shelf space.    b.  NDSD has been unable to find suitable local independent distributors        for several regions in which its trucks are not able to operate        profitably due to insufficient sales volumes.    As a result of these factors NDSD is expanding the rationalization of    its DSD network. This is expected to push out the restructuring to the    second quarter of 2013 and to result in approximately $3.1 million in    additional severance and other restructuring related costs.    The Company firmly believes that there is an important and profitable    role for DSD distribution in Canada, particularly in remote areas and    among independent and small chain convenience store retailers.    Furthermore, given the history of larger convenience store chains    switching back to DSD distribution due to lower sales under a wholesale    distribution model, there is significant potential for NDSD to win back    the distribution business lost in 2012.    Looking forward (see Forward Looking Statements), the restructuring of    NDSD is expected to: (i) result in a significant improvement in NDSD's    earnings starting in the third quarter of 2013, regardless of whether or    not NDSD is successful in winning back some of the large convenience    store chain distribution business lost in 2012; and (ii) position NDSD    as Canada's leading distributor for large convenience store retailers    who choose DSD distribution.--  $1.2 million in startup, redundant lease and severance costs associated    with Stuyver's new artisan bread facility, which commenced commercial    operations in the second quarter of 2012.    This initiative, which was also effectively completed at the end of    2012, is expected to (see Forward Looking Statements): (i) substantially    increase Stuyver's production capacity as its previous bakery, which was    shut down in July 2012, was operating at near to capacity; and (ii)    generate significant production efficiencies once the plant is operating    at a reasonable level of capacity utilization.--  $0.3 million in restructuring costs associated with a variety of    initiatives including the start-up of Centennial Foodservice's new    seafood processing facility and the transitioning of production from the    Company's Richmond, BC deli meats processing facility, which is    scheduled to be shutdown in July 2013, to some of its other deli meats    processing plants.