SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11-K
(Mark one)
(X) ANNUAL REPORT PURSUANT TO SECTION 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the calendar year December 31, 2003
OR
( ) TRANSITION REPORT PURSUANT TO SECTION 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission file number 1-5084
TASTY BAKING COMPANY 401 (K) THRIFT PLAN
2801 Hunting Park Avenue
Philadelphia, Pennsylvania 19129
(Full title of the plan and the address of the plan,
if different from that of the issuer named below)
TASTY BAKING COMPANY
2801 Hunting Park Avenue
Philadelphia, Pennsylvania 19129
(Name of issuer of the securities held pursuant to the Plan
and the address of the principal executive offices of Tasty Baking Company)
TASTY BAKING COMPANY 401 (K) THRIFT PLAN
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TABLE OF CONTENTS
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Page
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INDEPENDENT AUDITORS' REPORTS 2-3
FINANCIAL STATEMENTS:
Statements of Net Assets Available for Benefits
at December 31, 2003 and December 31, 2002 4
Statements of Changes in Net Assets Available for
Benefits for the years ended December 31, 2003
and December 31, 2002 5
Notes to Financial Statements 6-11
Supplemental Schedule:
Assets Held for Investment Purposes at end of year H, IV, 4i*
Exhibits:
23.1 Consent of Independent Auditors -- Mitchell & Titus LLP
23.2 Consent of Independent Auditors -- PricewaterhouseCoopers LLP
_______________________
* Refers to item numbers in Form 5500 (Annual Return/Report of Employee Benefit
Plan) for the year ended December 31, 2003.
INDEPENDENT AUDITORS REPORT
To the Participants and Administrator of
Tasty Baking Company 401(k) Thrift Plan:
We have audited the accompanying statement of net assets available for benefits
of the Tasty Baking Company 401 (k) Thrift Plan ("the Plan") as of December 31,
2003, and the related statement of changes in net assets available for benefits
for the year then ended. These financial statements are the responsibility of
the Plan's management. Our responsibility is to express an opinion on these
financial statements based on our audit.
We conducted our audit in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, and evaluating the overall financial
statement presentation. We believe our audit provides a reasonable basis for our
opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets available for benefit of the Plan as of
December 31, 2003, and the changes in its net assets available for benefits for
the year then ended in conformity with generally accepted accounting principles
in the United States of America.
Our audit was conducted for the purpose of forming an opinion on the Plan's
basic financial statements taken as a whole. The supplemental schedule of assets
held for investment purposes at year end is presented for the purpose of
additional analysis and is not a required part of the basic financial
statements, but is supplementary information required by the Department of
Labor's Rules and Regulations for Reporting and Disclosure under the Employee
Retirement Income Security Act of 1974. The supplemental schedule is the
responsibility of the Plan's management. The supplemental schedule has been
subjected to the auditing procedures applied in the audit of the basic financial
statements and, in our opinion, is fairly stated in all material respects, in
relation to the basic financial statements taken as a whole.
/s/ Mitchell & Titus, LLP
Philadelphia, PA
June 25, 2004
Report of Independent Registered Public Accounting Firm
To the Participants and Administrator of
Tasty Baking Company
401 (K) Thrift Plan
In our opinion, the accompanying statement of net assets available for benefits
and the related statement of changes in net assets available for benefits
present fairly, in all material respects, the net assets available for benefits
of the Tasty Baking Company 401 (K) Thrift Plan (the "Plan") at December 31,
2002, and the changes in net assets available for benefits for the year ended
December 31, 2002 in conformity with accounting principles generally accepted in
the United States of America. These financial statements are the responsibility
of the Plan's management. Our responsibility is to express an opinion on these
financial statements based on our audit. We conducted our audit of these
statements in accordance with the standards of the Public Company Accounting
Oversight Board (United States). Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial,
statements, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement presentation.
We believe that our audit provides reasonable basis for our opinion.
/s/ PricewaterhouseCoopers LLP
PricewaterhouseCoopers LLP
Philadelphia, PA
June 25, 2003
TASTY BAKING COMPANY 401(K) THRIFT PLAN
Statements of Net Assets Available For Benefits
December 31, 2003 and 2002
--------------------------------------------------------------------------------
2003 2002
----------- -----------
ASSETS
Investments $27,338,290 $23,745,648
Receivables:
Securities sold 30,750 13
----------- -----------
Total assets 27,369,040 23,745,661
LIABILITIES
Payables:
Securities purchased 37,875 -
----------- -----------
Total liabilities 37,875 -
----------- -----------
NET ASSETS AVAILABLE FOR
BENEFITS $27,331,165 $23,745,661
=========== ===========
The accompanying notes are an integral part of these financial statements.
4
TASTY BAKING COMPANY 401(K) THRIFT PLAN
Statements of Changes in Net Assets Available For Benefits
For the Years Ended December 31, 2003 and 2002
---------------------------------------------------------------------------------------
2003 2002
------------ ------------
ADDITIONS:
Additions to net assets attributed to:
Net appreciation (depreciation) in
fair value of investments $ 2,898,708 $ (6,730,999)
Cash dividends 583,332 803,569
Interest 121,088 139,784
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3,603,128 (5,787,646)
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CONTRIBUTIONS:
Participant 1,796,081 1,914,326
Employer 379,242 405,292
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2,175,323 2,319,618
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Total additions 5,778,451 (3,468,028)
------------ ------------
DEDUCTIONS:
Deductions from net assets attributed to:
Benefits paid to participants 2,192,947 4,595,791
------------ ------------
Total deductions 2,192,947 4,595,791
------------ ------------
Net increase (decrease) 3,585,504 (8,063,819)
NET ASSETS AVAILABLE FOR BENEFITS:
Beginning of year 23,745,661 31,809,480
------------ ------------
End of year $ 27,331,165 $ 23,745,661
============ ============
The accompanying notes are an integral part of these financial statements.
5
TASTY BAKING COMPANY 401(K) THRIFT PLAN
Notes to Financial Statements
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1. DESCRIPTION OF PLAN
-------------------
General
-------
The Tasty Baking Company 401(k) Thrift Plan (the Plan) is a defined
contribution plan under which all employees of Tasty Baking Company
(TBC) who meet certain service requirements are eligible to
participate. The Plan is subject to the provisions of the Employee
Retirement Income Security Act of 1974 (ERISA).
For allocations, benefits and vesting provisions as well as any other
questions, Plan participants should refer to the Plan document.
While TBC has not expressed any intent to discontinue the Plan, it is
free to do so at any time, subject to the provisions set forth in
ERISA. In the event such discontinuance resulted in the termination of
the Plan, the net assets of the Plan, comprised of all participant
account balances, would be distributed to Plan participants and
beneficiaries.
Contributions
-------------
Under the Plan, employee contributions may be made in an amount up to
15% of an employee's annual base salary. The Company's contribution
(employer portion) is equal to an amount not to exceed the lesser of
$600 or 100% of the contributions made by each employee. Employee
contributions are made through payroll deductions as authorized by the
employees and are immediately vested. The Company's contributions are
invested in TBC common stock while participants may choose from a
selection of mutual fund options offered by Dreyfus Service
Corporation, a trustee for the Plan, for their contributions.
The Company's investment alternatives available to participants provide
alternatives that cover all major sectors of the market. These
investment alternatives include: Capital Preservation Fund, Dreyfus
100% U.S. Treasury Intermediate Term Fund, Dreyfus Disciplined Stock
Fund, Dreyfus Premier Balanced Fund, Dreyfus Emerging Leaders Fund,
Dreyfus S&P 500 Basic Index Fund, Dreyfus Premier Midcap Fund and the
Dreyfus International Value Fund. Participants may change the
investment mix of their ongoing and/or existing invested account
balances daily. They may sell any shares of Tasty Baking Company stock
in their employee account, resulting from a participant elected fund
option prior to 1995, and invest the proceeds in any other investment
funds offered.
6
TASTY BAKING COMPANY 401(K) THRIFT PLAN
Notes to Financial Statements
--------------------------------------------------------------------------------
1. DESCRIPTION OF PLAN
-------------------
Withdrawals
-----------
Participants who terminate from the Plan can elect to have distributed
to them the full value in their respective accounts which include their
contributions and 100% of the employer contributions made on their
behalf.
Active participants may withdraw balances accumulated through 1987 once
each quarter without cause. All balances accumulated may be withdrawn
(pre-1987 funds first) at any time but only for a hardship withdrawal
as defined by IRS regulations. Once an active participant has been a
Plan participant for five years, company contributions can be withdrawn
on any Plan year-end date. Withdrawals by an active participant in this
regard causes no interruption to contributions and company matching
contributions are not penalized.
Participant Loans
-----------------
The Plan allows participants to obtain loans at a minimum amount of
$500. In addition to other loan requirements, the unpaid balance from
all loans outstanding to a participant from the Plan shall not exceed
50% of the vested balance of the participant's account or $50,000,
whichever is less. Loans bear interest at amounts determined by the
administrator and are currently the Prime Rate plus 1%. Loans are
repayable in equal installments through payroll deductions and are
collateralized by 50% of participant's vested account balance.
2. Summary of Significant Accounting Policies
------------------------------------------
Investment Valuation and Income Recognition
-------------------------------------------
Investments are stated at fair value. The value of common stock of
Tasty Baking Company is determined based upon the bid price of the
stock on the NYSE on the last day of trading of the Plan year.
The investment in Mutual Funds is represented by unit shares, which are
valued at each respective fund's net asset value as publicly reported
by the fund's respective investment department. The Capital
Preservation Fund, a money market fund, is reported at fair value,
which is equivalent to cost.
7
TASTY BAKING COMPANY 401(K) THRIFT PLAN
Notes to Financial Statements
--------------------------------------------------------------------------------
2. Summary of Significant Accounting Policies (continued)
------------------------------------------
Investment Valuation and Income Recognition (continued)
-------------------------------------------
Purchases and sales of investments are reflected on a trade-date basis.
Gains and losses realized are based principally on specific
identification. Plan investments are sold to satisfy participant
withdrawal and transfer requests and, therefore, resultant gains or
losses are recorded as withdrawals are made.
Dividend income is recorded on the ex-dividend date. Income from other
investments is recorded as earned on an accrual basis.
The Plan presents in the Statements of Changes in Net Assets Available
for Benefits the net appreciation (depreciation) in the fair value of
its investments, which consists of the realized gains or losses and the
unrealized appreciation (depreciation) on those investments.
Payment of Benefits
-------------------
Benefits are recorded when paid.
Use of Estimates
----------------
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities
and changes therein, and disclosures of contingent assets and
liabilities. Actual results could differ from those estimates.
Risks and Uncertainties
-----------------------
The Plan provides for various investment options including a money
market fund, Tasty Baking Company common stock, and mutual funds.
Investment securities are exposed to various risks, such as interest
rate, market and credit. Due to the level of risk associated with
certain investment securities and the level of uncertainty related to
changes in the value of investment securities, it is at least reasonably
possible that changes in risks in the near term would materially affect
participants' account balances and the amounts reported in the statement
of net assets available for benefits and the statement of changes in net
assets available for benefits.
8
TASTY BAKING COMPANY 401(K) THRIFT PLAN
Notes to Financial Statements
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3. Related Party Transactions
--------------------------
Tasty Baking Company is the sponsor of the Plan and pays all
administrative expenses and fees on behalf of the participants excluding
fees for participant loans. For the years ended December 31, 2003 and
2002, fees and expenses totaling $32,345 and $34,651, respectively, were
paid to Dreyfus Service Corporation and Dreyfus Trust Company, the
Plan's administrator and trustee, respectively, on behalf of the Plan's
participants.
4. Investments
-----------
The following table represents investments of 5% or more of the Plan's
net assets:
December 31,
2003 2002
----------------- -----------------
Tasty Baking Company Common Stock
497,073 and 487,785 shares, respectively $ 5,025,408 $ 4,243,730
Capital Preservation Fund, LaSalle National
Trust, N.A., Collective Investment Trust 8,491,132 8,453,764
S&P 500 Basic Index Fund, Dreyfus Service
Corporation 2,275,634 1,596,226
Discipline Stock fund, Dreyfus Service
Corporation 3,398,151 2,870,826
Emerging Leaders Fund, Dreyfus Service
Corporation 2,790,264 1,873,528
100% U.S. Treasury Intermediate Term
Fund, Dreyfus Service Corporation 1,379,607 1,262,073
Premier Balanced Fund , Dreyfus Service
Corporation 1,504,705 1,202,046
Loans to Participants 1,746,265 1,841,068
9
TASTY BAKING COMPANY 401(K) THRIFT PLAN
Notes to Financial Statements
--------------------------------------------------------------------------------
4. Investments (continued)
-----------
During 2003 and 2002, the Plan's investments (including gains and losses
on investments bought and sold, as well as held during the year)
appreciated/(depreciated) in value as follows:
2003 2002
----------------- ------------------
Mutual Funds $ 2,190,919 $ (2,125,732)
Common Stock 707,789 (4,605,267)
----------------- ------------------
Appreciation/ (Depreciation) $ 2,898,708 $ (6,730,999)
================= ==================
5. Nonparticipant -Directed Investments
------------------------------------
December 31,
2003 2002
----------------- ------------------
Net Assets:
Tasty Baking Company Common Stock $ 4,833,228 $4,073,783
Year Ended December 31,
2003 2002
----------------- ------------------
Change in Net Assets:
Employer Contributions $ 379,242 $ 405,292
Dividends 95,665 242,762
Distributions to participants (241,879) (1,314,158)
Direct Rollover Transfer (150,457) (316,891)
Net (depreciation) appreciation
of investments 676,874 (4,422,758)
----------------- ------------------
$ 759,445 $ (5,405,753)
================= ==================
10
TASTY BAKING COMPANY 401(K) THRIFT PLAN
Notes to Financial Statements
--------------------------------------------------------------------------------
6. Federal Income Taxes
-------------------
The United States Treasury Department determined on June 7, 2004 that
the Plan, as amended and restated in effect from January 1, 2003, which
is a non-standardized prototype profit sharing plan and trust sponsored
by Dreyfus Corporation, constituted a qualified trust under Section
401(a) of the Internal Revenue Code and is therefore exempt from
federal income taxes under provisions of Section 501(a).
11
SUPPLEMENTAL SCHEDULE OF ASSETS HELD FOR
INVESTMENT PURPOSES AT DECEMBER 31, 2003 PURSUANT TO
SCHEDULE H, PART IV, ITEM 4i IN ANNUAL RETURN/REPORT
OF EMPLOYEE BENEFIT PLAN FORM 5500
E.I.N. 231145880/PN 002
Schedule H, Part IV, Item 4i
TASTY BAKING COMPANY 401(K) THRIFT PLAN
Description of Investment
. Including Maturity Date
Identity of Issue, Borrower, Rate of Interest, Collateral, Current
a. b. Lessor or Similar Party c. Par of Maturity Value d. Cost e. Value
-------------------------------------- ------------------------------- -------------------- --------------------
*Tasty Baking Company Common Stock $ 5,455,442 $ 5,025,408
Capital Preservation Fund, LaSalle Collective Investment Fund 8,491,132 8,491,132
National Trust, N.A.
*Dreyfus 100% U. S. Treasury
Intermediate Term Fund Mutual Fund 1,349,208 1,379,607
*Dreyfus S&P 500 Basic Index Fund Mutual Fund 2,496,744 2,275,634
*Dreyfus Premier Balanced Fund Mutual Fund 1,693,478 1,504,705
*Dreyfus Disciplined Stock Fund Mutual Fund 3,249,266 3,398,151
*Dreyfus Emerging Leaders Fund Mutual Fund 2,407,304 2,790,264
*Dreyfus Premier Midcap Fund Mutual Fund 419,749 474,007
*Dreyfus International Value Fund Mutual Fund 219,029 253,117
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Subtotal Mutual Funds 11,834,778 12,075,485
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Loans to Participants 5% 10.5% 1,746,265
---------- ----------
Total $ 25,781,352 $ 27,338,290
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*Party-In-Interest
SIGNATURES
----------
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Committee members who administer the Plan have duly caused this annual report to
be signed on its behalf by the undersigned hereunto duly authorized.
TASTY BAKING COMPANY 401 (K) THRIFT PLAN
By: /s/ David S. Marberger
--------------------------------------------
David S. Marberger, Chairman of the
Administrative Committee
Date: June 28, 2004