Bridgford Foods 10Q Report 3rd Qtr 2010

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark one)
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES AND EXCHANGE ACT OF 1934

For the quarterly period ended July 09, 2010

OR

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from __________ to ___________.

Commission file number 0-2396


BRIDGFORD FOODS CORPORATION
(Exact name of Registrant as specified in its charter)


California			95-1778176
(State or other jurisdiction of			(I.R.S. Employer
incorporation or organization)			identification number)


1308 N. Patt Street, Anaheim, CA 92801
(Address of principal executive offices-Zip code)

714-526-5533
(Registrant's telephone number, including area code)


		Indicate by check mark whether the registrant (1) has filed all reports required to be filed
		by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months
		(or for such shorter period that the registrant was required to file such reports), and (2) has
		been subject to such filing requirements for the past 90 days.

Yes [ X ] No [ ]

		Indicate by check mark whether the Registrant has submitted electronically and posted on its
		corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant
		to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for
		such shorter period that the registrant was required to submit and post such files).

Yes [ ] No [ ]

		Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer,
		a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer,"
		"accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act.

	Large accelerated filer [ ]			Accelerated filer [ ]

	Non-accelerated filer [ ] (Do not check if smaller reporting company)			Smaller reporting company [ X ]

		Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the
		Exchange Act).

Yes [ ] No [ X ]

		As of August 19, 2010 the registrant had 9,329,887 shares of common stock outstanding.

BRIDGFORD FOODS CORPORATION

FORM 10-Q QUARTERLY REPORT

INDEX

References to "Bridgford Foods" or the "Company" contained in this Quarterly Report on Form 10-Q refer to Bridgford Foods Corporation.

Part I. Financial Information

Item 1. Financial Statements

Page

a. Condensed Consolidated Balance Sheets at July 9, 2010 (unaudited) and October 30, 2009

b. Condensed Consolidated Statements of Operations for the twelve and thirty-six weeks ended July 9, 2010

and July 10, 2009 (unaudited)

c. Condensed Consolidated Statements of Cash Flows for the thirty-six weeks ended July 9, 2010 and

July 10, 2009 (unaudited)

d. Notes to Condensed Consolidated Financial Statements (unaudited)

Item 2. Management's Discussion and Analysis of Financial Condition

and Results of Operations

Item 3. Quantitative and Qualitative Disclosures about Market Risk

Item 4T. Controls and Procedures

Part II. Other Information

Item 1A. Risk Factors

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Item 6. Exhibits

Signatures

Items 1, 3 and 5 of Part II have been omitted because they are not applicable with respect to the current reporting period.

Part I. Financial Information

Item 1. a.

BRIDGFORD FOODS CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except per share amounts)

ASSETS	July 9, 2010			October 30, 2009
	(Unaudited)
Current assets:

Cash and cash equivalents	$	16,117		$	13,911
Accounts receivable, less allowance for doubtful accounts of $303
and $404, respectively, and promotional allowances of $1,710
and $1,962, respectively		10,383			9,718
Inventories, less inventory reserves of $232 and $101, respectively (Note 2)		14,306			15,595
Prepaid expenses and other current assets		260			789

Total current assets		41,066			40,013

Property, plant and equipment, less
accumulated depreciation of $56,343
and $55,362, respectively		7,645			8,300

Other non-current assets		10,788			10,586
	$	59,499		$	58,899

LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities:

Accounts payable	$	3,738		$	4,227
Accrued payroll, advertising and other expenses		8,275			8,987

Total current liabilities		12,013			13,214

Non-current liabilities		13,695			13,262

Total liabilities		25,708			26,476


Commitments and Contingencies (Note 3)

Shareholders' equity:
Preferred stock, without par value
Authorized - 1,000 shares
Issued and outstanding - none

Common stock, $1.00 par value
Authorized - 20,000 shares
Issued and outstanding - 9,330 and 9,355 shares, respectively		9,387			9,412
Capital in excess of par value		10,418			10,646
Retained earnings		22,706			21,085
Accumulated other comprehensive loss		(8,720	)		(8,720	)
		33,791			32,423
	$	59,499		$	58,899

See accompanying notes to condensed consolidated financial statements.

Item 1. b.

BRIDGFORD FOODS CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited)

(in thousands, except per share amounts)

	12 weeks ended					36 weeks ended
	July 9, 2010			July 10, 2009		July 9, 2010		July 10, 2009

Net sales	$	26,933		$	26,281	$	83,012	$	83,435
Cost of products sold		17,089			15,461		49,229		50,466

Gross margin		9,844			10,820		33,783		32,969

Selling, general and administrative expenses		9,806			9,552		29,730		29,133

Income before taxes		38			1,268		4,053		3,836
Income tax provision		799			208		1,499		208

Net (loss) income	$	(761	)	$	1,060	$	2,554	$	3,628


Net (loss) income per share - basic and diluted	$	(0.08	)	$	0.11	$	0.27	$	0.38

Weighted average common shares - Basic and diluted		9,330			9,419		9,336		9,429


Cash dividends paid per share	$	-		$	-	$	0.10	$	-

See accompanying notes to condensed consolidated financial statements.

Item 1. c.

BRIDGFORD FOODS CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(in thousands)

	36 weeks ended
	July 9, 2010			July 10, 2009


Cash flows from operating activities:

Net income	$	2,554		$	3,628

Income or charges not affecting cash and cash equivalents:
Depreciation		1,508			1,962
(Recoveries) losses on accounts receivable		(100	)		6
Gain on sale of property, plant and equipment		(25	)		(10	)
Effect on cash and cash equivalents from changes in operating assets and liabilities:
Accounts receivable		(565	)		1,619
Inventories		1,289			1,005
Prepaid expenses and other current assets		529			(337	)
Other non-current assets		(202	)		(4	)
Accounts payable		(489	)		531
Accrued payroll, advertising and other expenses		(712	)		(562	)
Non-current liabilities		433			(325	)

Net cash provided by operating activities		4,220			7,513

Cash used in investing activities:
Proceeds from sale of property, plant and equipment		25			56
Additions to property, plant and equipment		(853	)		(984	)

Net cash used in investing activities		(828	)		(928	)

Cash used in financing activities:
Shares repurchased		(253	)		(270	)
Cash dividends paid		(933	)		--

Net cash used in financing activities		(1,186	)		(270	)

Net increase in cash and cash equivalents		2,206			6,315

Cash and cash equivalents at beginning of period		13,911			6,092

Cash and cash equivalents at end of period	$	16,117		$	12,407

Cash paid for income taxes	$	1,250			--

See accompanying notes to condensed consolidated financial statements.

Item 1. d.

BRIDGFORD FOODS CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(in thousands, except percentages, share and per share amounts)

Note 1 - Summary of Significant Accounting Policies:

The unaudited consolidated condensed financial statements of Bridgford Foods Corporation (the "Company", "we", "our", "us") for the twelve and
thirty-six weeks ended July 9, 2010 and July 10, 2009 have been prepared in conformity with the accounting principles described in the
Company's Annual Report on Form 10-K for the fiscal year ended October 30, 2009 (the "Annual Report") and include all adjustments considered
necessary by management for a fair presentation of the interim periods. This report should be read in conjunction with the Annual Report.
Due to seasonality and other factors, interim results are not necessarily indicative of the results for the full year. New accounting pronouncements
and their effect on the Company are discussed in Management's Discussion and Analysis of Financial Condition and Results of Operations
in this Form 10-Q.

The October 30, 2009 balance sheet within these interim condensed consolidated financial statements was derived from the audited fiscal 2009
financial statements.

The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of
America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities as of the date of the financial statements and the reported revenues and expenses during the reporting periods.
Actual results may vary from these estimates. Some of the estimates needed to be made by management include the allowance for doubtful
accounts, promotional and returns allowances, inventory reserves and the estimated useful lives of property and equipment, and the valuation
allowance for the Company’s deferred tax assets. Actual results could materially differ from these estimates. Amounts estimated related to
liabilities for self-insured workers’ compensation, employee healthcare and pension benefits are especially subject to inherent uncertainties and
these estimated liabilities may ultimately settle at amounts which vary from our current estimates.

Financial instruments that subject the Company to credit risk consist primarily of cash and cash equivalents, accounts receivable, accounts payable
and accrued payroll, advertising and other expenses. The carrying amount of these instruments approximate fair market value due to the short maturity
of these instruments. At July 9, 2010, the Company had accounts in excess of the Federal Deposit Insurance Corporation insurance coverage limit.
The Company has not experienced any losses in these accounts and believes it is not exposed to any significant credit risk on cash and cash
equivalents. The Company issues credit to a significant number of customers that are diversified over a wide geographic area. The Company
monitors the payment histories of its customers and maintains an allowance for doubtful accounts which is reviewed for adequacy on a quarterly
basis. The Company does not require collateral from its customers.

For the thirty-six weeks ended July 9, 2010 and July 10, 2009, Wal-Mart® accounted for 14.4% and 11.7%, respectively, of consolidated
revenues and 9.4% and 15.2% of consolidated accounts receivable. For the thirty-six weeks ended July 9, 2010, Dollar General® accounted for
10.4% of consolidated revenues and 32.6% of consolidated accounts receivable. No other customer accounted for more than 10% of consolidated accounts receivable or consolidated revenues for the thirty-six weeks ended July 10, 2009.

The Company has changed the presentation of the Condensed Consolidated Statements of Operations to present a gross margin line item. As a result,
depreciation previously presented separately is now part of cost of products sold and selling, general and administrative expenses
Prior year amounts have been reclassified to give effect to this presentation.

Note 2 - Inventories:

Inventories are comprised of the following at the respective period ends:

	(unaudited)
	July 9, 2010		October 30, 2009
Meat, ingredients
and supplies	$	4,037	$	4,488
Work in progress		1,191		1,647
Finished goods		9,078		9,460
	$	14,306	$	15,595

Inventories are valued at the lower of cost (which approximates actual cost on a first-in, first-out basis) or market. Costs related to
warehousing, transportation and distribution to customers are considered when computing market value. Inventories include the cost of
ingredients, labor and manufacturing overhead. We regularly review inventory quantities on hand and write down any excess or
obsolete inventories to estimated net realizable value. An inventory reserve is created when potentially slow-moving or obsolete inventories
are identified in order to reflect the appropriate inventory value. Changes in economic conditions, production requirements, and lower than
expected customer demand could result in additional obsolete or slow-moving inventory that cannot be sold or may need to be sold at
reduced prices and could result in additional reserve provisions.

Note 3 - Commitments and Contingencies:

The Company leases certain transportation equipment under operating leases. The terms of the transportation leases provide
for renewal options and contingent rental payments based upon mileage and adjustments of rental payments based on the Consumer
Price Index. The Company also leases warehouse and/or office facilities throughout the United States and Canada through month-to-month
rental agreements. No material changes have been made to these agreements during the first thirty-six weeks of fiscal 2010.

The Company is involved in various claims and legal actions arising in the ordinary course of business. In the opinion of management,
the ultimate disposition of these matters is not expected to have a material adverse effect on the Company’s consolidated financial position
or results of operations.

The Company purchases bulk flour under short-term fixed price contracts during the normal course of business. Under these arrangements,
the Company is obligated to purchase specific quantities at fixed prices, within the specified contract period. These contracts provide for
automatic price increases if agreed quantities are not purchased within the specified contract period. No significant contracts remained
unfulfilled at July 9, 2010.

Note 4 - Segment Information:

The Company has two reportable operating segments, Frozen Food Products (the processing and distribution of frozen products) and
Refrigerated and Snack Food Products (the processing and distribution of refrigerated meat and other convenience foods).

We evaluate each segment's performance based on revenues and operating income. Selling, general and administrative expenses
include corporate accounting, information systems, human resource management and marketing, which are managed at the corporate level.
These activities are allocated to each operating segment based on revenues and/or actual usage.

The following segment information is presented for the twelve and thirty-six weeks ended July 9, 2010 and July 10, 2009.

				Refrigerated
				and
Twelve Weeks Ended	Frozen Food			Snack Food
July 9, 2010	Products			Products			Other			Elimination		Totals
Sales to external customers	$	11,001		$	15,932		$	-		$	-	$	26,933
Intersegment sales		-			322			-			322		-
Net sales		11,001			16,254			-			322		26,933
Cost of products sold		6,657			10,754			-			322		17,089
Gross margin		4,344			5,500			-			-		9,844
Selling, general and administrative expenses		4,072			5,719			15			-		9,806
Income (loss) before taxes		272			(219	)		(15	)		-		38
Income tax provision		622			177			-			-		799
Net (loss)	$	(350	)	$	(396	)	$	(15	)	$	-	$	(761	)

Total assets	$	10,627		$	22,201		$	26,671		$	-	$	59,499
Additions to property, plant and equipment	$	78		$	123		$	-		$	-	$	201


				Refrigerated
				and
Twelve Weeks Ended	Frozen Food			Snack Food
July 10, 2009	Products			Products			Other			Elimination		Totals
Sales to external customers	$	11,186		$	15,095		$	-		$	-	$	26,281
Intersegment sales		-			123			-			123		-
Net sales		11,186			15,218			-			123		26,281
Cost of products sold		6,560			9,024			-			123		15,461
Gross margin		4,626			6,194			-			-		10,820
Selling, general and administrative expenses		3,685			5,835			32			-		9,552
Income (loss) before taxes		941			359			(32	)		-		1,268
Income tax provision		68			140			-			-		208
Net income (loss)	$	873		$	219		$	(32	)	$	-	$	1,060

Total assets	$	10,100		$	21,374		$	23,475		$	-	$	54,949
Additions to property, plant and equipment	$	143		$	37		$	30		$	-	$	210

			Refrigerated
			and
Thirty-six Weeks Ended	Frozen Food		Snack Food
July 9, 2010	Products		Products		Other		Elimination		Totals
Sales to external customers	$	36,613	$	46,399	$	-	$	-	$	83,012
Intersegment sales		-		859		-		859		-
Net sales		36,613		47,258		-		859		83,012
Cost of products sold		21,816		28,272		-		859		49,229
Gross margin		14,797		18,986		-