10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Quarterly Period Ended December 31, 2013

OR

o 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: 001-35470

Annie’s, Inc.

(Exact name of registrant as specified in its charter)

Delaware	20-1266625
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
1610 Fifth Street Berkeley, CA	94710
(Address of principal executive offices)	(Zip Code)

(510) 558-7500

(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  o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (Section 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  x    No  o

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	o		Accelerated filer	x
Non-accelerated filer	o	(Do not check if a smaller reporting company)	Smaller reporting company	o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  o    No  x

Under the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”), Annie’s, Inc. qualifies as an “emerging growth company,” as defined under the JOBS Act.

On January 31, 2014, the registrant had 16,998,675 shares of common stock, par value $0.001 per share, outstanding.

Annie’s, Inc.

FORM 10-Q

TABLE OF CONTENTS

PART I – FINANCIAL INFORMATION
Item 1.	Condensed Consolidated Financial Statements (Unaudited)	2
	Condensed Consolidated Statements of Operations for the Three and Nine Months Ended December 31, 2013 and 2012	2
	Condensed Consolidated Balance Sheets as of December 31, 2013 and March 31, 2013	3
	Condensed Consolidated Statement of Stockholders’ Equity for the Nine Months Ended December 31, 2013	4
	Condensed Consolidated Statements of Cash Flows for the Nine Months Ended December 31, 2013 and 2012	5
	Notes to Condensed Consolidated Financial Statements	6
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	17
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	30
Item 4.	Controls and Procedures	31
PART II – OTHER INFORMATION
Item 1.	Legal Proceedings	32
Item 1A.	Risk Factors	32
Item 6.	Exhibits	34
Signatures		35

1

PART I – FINANCIAL INFORMATION

ITEM 1 – CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Annie’s, Inc.

Condensed Consolidated Statements of Operations

(unaudited)

(in thousands, except share and per share amounts)

	Three Months Ended December 31,						Nine Months Ended December 31,
	2013			2012			2013			2012
Net sales	$	46,177		$	36,283		$	143,867		$	117,262
Cost of sales	27,951			23,267			88,978			72,539
Gross profit	18,226			13,016			54,889			44,723
Operating expenses:
Selling, general and administrative expenses	13,421			10,687			37,286			32,437
Income from operations	4,805			2,329			17,603			12,286
Interest expense	(80		)	(40		)	(255		)	(120		)
Other income (expense), net	30			31			88			116
Income before provision for income taxes	4,755			2,320			17,436			12,282
Provision for income taxes	1,966			919			7,066			4,965
Net income	$	2,789		$	1,401		$	10,370		$	7,317
Earnings per share
—Basic	$	0.16		$	0.08		$	0.61		$	0.43
—Diluted	$	0.16		$	0.08		$	0.60		$	0.41
Weighted average shares of common stock outstanding used in computing earnings per share
—Basic	16,937,139			17,249,536			16,901,089			17,085,833
—Diluted	17,398,006			17,781,720			17,386,408			17,702,221

See accompanying notes to the unaudited condensed consolidated financial statements

2

Annie’s, Inc.

Condensed Consolidated Balance Sheets

(unaudited)

(in thousands)

	December 31, 2013			March 31, 2013
ASSETS
CURRENT ASSETS:
Cash	$	2,986		$	4,930
Accounts receivable, net of allowance	18,796			20,015
Inventory	23,407			15,147
Deferred tax assets	2,565			2,558
Income tax receivable	988			588
Prepaid expenses and other current assets	5,572			5,050
Total current assets	54,314			48,288
Restricted cash	300			—
Property and equipment, net	6,206			6,138
Goodwill	30,809			30,809
Intangible assets, net	1,071			1,116
Deferred tax assets, long-term	3,553			3,704
Other non-current assets	142			157
Total assets	$	96,395		$	90,212
LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES:
Accounts payable	$	6,784		$	4,342
Accrued liabilities	9,104			12,021
Total current liabilities	15,888			16,363
Credit facility	—			7,007
Other non-current liabilities	870			913
Total liabilities	16,758			24,283
Commitments and contingencies (Note 7)
STOCKHOLDERS’ EQUITY
Common stock	17			17
Additional paid-in capital	96,528			93,190
Accumulated deficit	(16,908		)	(27,278		)
Total stockholders’ equity	79,637			65,929
Total liabilities and stockholders’ equity	$	96,395		$	90,212

See accompanying notes to the unaudited condensed consolidated financial statements

3

Annie’s, Inc.

Condensed Consolidated Statement of Stockholders’ Equity

(unaudited)

(in thousands, except share amounts)

				Additional					Total
	Common Stock			Paid-in		Accumulated			Stockholders’
	Shares	Amount		Capital		Deficit			Equity
Balance at March 31, 2013	16,849,016	$	17	$	93,190	$	(27,278	)	$	65,929
Exercise of stock options	123,364	—		1,211		—			1,211
Excess tax benefit from stock-based compensation	—	—		1,467		—			1,467
Stock-based compensation	—	—		660		—			660
Net Income	—	—		—		10,370			10,370
Balance at December 31, 2013	16,972,380	$	17	$	96,528	$	(16,908	)	$	79,637

See accompanying notes to the unaudited condensed consolidated financial statements

4

Annie’s, Inc.

Condensed Consolidated Statements of Cash Flows

(unaudited)

(in thousands)

	Nine Months Ended December 31,
	2013			2012
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income	$	10,370		$	7,317
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	1,035			749
Stock-based compensation	660			677
Provision for doubtful accounts	21			—
Excess tax benefit from stock-based compensation	(1,467		)	(7,499		)
Accretion of imputed interest on purchase of intangible asset	107			107
Change in fair value of convertible preferred stock warrant liability	—			13
Amortization of deferred financing costs	9			12
Loss on disposal of property and equipment	1			—
Deferred taxes	144			535
Changes in operating assets and liabilities:
Accounts receivable, net	1,198			1,760
Inventory	(8,260		)	(10,925		)
Income tax receivable	(400		)	425
Prepaid expenses, other current and non-current assets	(516		)	4,400
Accounts payable	2,440			3,417
Related-party payable	—			(1,305		)
Accrued expenses and other non-current liabilities	(1,592		)	4,527
Net cash provided by operating activities	3,750			4,210
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment	(1,057		)	(1,498		)
Restricted cash	(300		)	—
Net cash used in investing activities	(1,357		)	(1,498		)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from credit facility	8,432			2,952
Payments to credit facility	(15,439		)	(15,748		)
Proceeds from common shares issued in initial public offering, net of issuance costs	—			11,146
Payment for intangible asset acquired by financing transaction	(8		)	(7		)
Excess tax benefit from stock-based compensation	1,467			7,499
Proceeds from exercises of stock options	1,211			3,844
Net cash provided by (used in) financing activities	(4,337		)	9,686
NET INCREASE (DECREASE) IN CASH	(1,944		)	12,398
CASH—Beginning of period	4,930			562
CASH—End of period	$	2,986		$	12,960
NONCASH INVESTING AND FINANCING ACTIVITIES:
Purchase of property and equipment funded through accrued expenses and accounts payable	$	2		$	425
Conversion of convertible preferred stock into common stock	$	—		$	81,373

See accompanying notes to the unaudited condensed consolidated financial statements

5

Annie’s, Inc.

Notes to Condensed Consolidated Financial Statements

(unaudited)

1. Description of Business

Annie’s, Inc. (the “Company”), a Delaware corporation incorporated on April 28, 2004, is a natural and organic food company. The Company offers over 135 products in the following three product categories: meals; snacks; and dressings, condiments and other. The Company’s products are sold throughout the U.S. and Canada via a multi-channel distribution network that serves the mainstream grocery, mass merchandiser and natural retailer channels. The Company’s headquarters are located in Berkeley, California.

2. Summary of Significant Accounting Policies

Basis of Presentation and Consolidation

The accompanying interim condensed consolidated statements of operations for the three and nine months ended December 31, 2013 and 2012, the interim condensed consolidated balance sheets as of December 31, 2013 and March 31, 2013, the interim condensed consolidated statement of stockholders’ equity for the nine months ended December 31, 2013, and the interim condensed consolidated statements of cash flows for the nine months ended December 31, 2013 and 2012 are unaudited. These unaudited interim condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and the applicable rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial information. Accordingly, they do not include all of the information and notes required by U.S. GAAP for complete financial statements. These unaudited interim condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto contained in Company’s Annual Report on Form 10-K filed with the SEC on June 14, 2013. The March 31, 2013 condensed consolidated balance sheet included herein was derived from the audited financial statements as of that date, but does not include all disclosures including notes required by U.S. GAAP for complete financial statements.

The unaudited interim condensed consolidated financial statements have been prepared on the same basis as the audited consolidated financial statements and, in the opinion of management, reflect all adjustments of a normal recurring nature considered necessary to state fairly the Company's financial position as of December 31, 2013 and results of its operations for the three and nine months ended December 31, 2013 and 2012, and the cash flows for the nine months ended December 31, 2013 and 2012. The interim results for the nine months ended December 31, 2013 are not necessarily indicative of the results that may be expected for the year ending March 31, 2014.

The unaudited interim condensed consolidated financial statements include the accounts of the Company and its wholly owned direct and indirect subsidiaries, Annie’s Homegrown, Inc., Annie’s Enterprises, Inc., Napa Valley Kitchen, Inc. and Annie's Baking, LLC. All significant intercompany balances and transactions have been eliminated in consolidation. Certain reclassifications were made to the Company's prior financial statements to conform to the current year presentation.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of sales and expenses during the reported periods. Actual results could differ from those estimates.

Accounts Receivable and Concentration Risk

The Company manages credit risk through credit approvals, credit limits and monitoring procedures. The Company performs periodic credit evaluations of its customers and records an allowance for uncollectible accounts receivable based on a specific identification methodology. In addition, management may record an additional allowance based on the Company’s experience with accounts receivable aging categories. Accounts receivable are recorded net of allowances for trade discounts and doubtful accounts. The Company had $21,000 for allowance for doubtful accounts as of December 31, 2013. The Company had no allowance for doubtful accounts as of March 31, 2013.

6

Annie’s, Inc.

Notes to Condensed Consolidated Financial Statements

(unaudited)

Customers with 10% or more of the Company’s net sales consist of the following:

	Net Sales
	Customer A		Customer B		Customer C
Three Months Ended December 31,
2013	22	%	18	%	11	%
2012	25	%	17	%	11	%
Nine Months Ended December 31,
2013	21	%	15	%	13	%
2012	26	%	13	%	12	%

As of December 31, 2013, two customers represented 31% and 18%, respectively, of accounts receivable. As of March 31, 2013, three customers represented 36%, 26%, and 10%, respectively, of accounts receivable.

Fair Value of Financial Instruments

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the reporting date. The accounting guidance establishes a three-tiered hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value:

Level 1—Quoted prices in active markets for identical assets or liabilities.

Level 2—Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

The categorization of a financial instrument within the valuation hierarchy is based on the lowest level of input that is significant to the fair value measurement.

The carrying amounts of the Company’s financial instruments, including accounts receivable, accounts payable and accrued liabilities, approximate fair value due to their relatively short maturities. Upon consummation of the Company's initial public offering on April 2, 2012, prior to the automatic conversion of the convertible preferred stock warrant into a common stock warrant, it was remeasured and the change in fair value was recorded as a non-cash charge in other income (expense), net and the related liability was reclassified to additional paid-in capital (see Note 8).

Inventories

Inventories are recorded at the lower of cost (determined under the first-in-first-out method) or market. Write downs are provided for finished goods expected to become nonsaleable due to age and provisions are specifically made for slow-moving or obsolete raw ingredients and packaging material. The Company also adjusts the carrying value of its inventories when it believes that the net realizable value is less than the carrying value. These write-downs are measured as the difference between the cost of the inventory, including estimated costs to complete, and estimated selling prices, including cost of selling. These charges are recorded as a component of cost of sales.

Property and Equipment

Property and equipment are stated at cost. Depreciation is computed using the straight-line method over the estimated useful lives of the assets. Leasehold improvements are amortized using the straight-line method over the shorter of the lease term or estimated useful lives. Maintenance and repairs are charged to expense as incurred. Assets not yet placed in use are not depreciated.

7

Annie’s, Inc.

Notes to Condensed Consolidated Financial Statements

(unaudited)

The useful lives of the property and equipment are as follows:

Equipment and automotive	3 to 7 years
Software	3 to 7 years
Plates and dies	3 years
Leasehold improvements	Shorter of lease term or estimated useful life

The Company capitalizes certain internal and external costs related to the development and enhancement of the Company’s internal-use software. Capitalized internal-use software development costs are included in property and equipment on the accompanying condensed consolidated balance sheets. As of December 31, 2013, the Company had $2.3 million capitalized software development costs, net of accumulated amortization, including $0.6 million in construction-in-progress. As of March 31, 2013, the Company had $2.1 million capitalized software development costs, net of accumulated amortization, including $0.4 million in construction-in-progress.

Intangible Assets

Intangible assets with determinable lives are amortized using the straight-line method.

Freight and Warehousing Costs

Freight and warehousing costs are included in selling, general and administrative expenses in the condensed consolidated statements of operations. Freight and warehousing costs primarily consist of costs associated with moving finished products to customers, including costs associated with the Company’s distribution center, route delivery costs and the cost of shipping products to customers through third-party carriers. Freight and warehousing costs recorded as a component of selling, general and administrative expenses were $1.8 million and $1.4 million for the three months ended December 31, 2013 and 2012, respectively, and were $5.2 million and $4.2 million for the nine months ended December 31, 2013 and 2012, respectively.

Research and Development (R&D) Costs

R&D costs consist of the costs incurred to develop new products and are expensed as incurred. These costs include consumer research, prototype development, materials and resources to conduct trial production runs, package development and employee-related costs for personnel responsible for product innovation. R&D costs recorded as a component of selling, general and administrative expenses were $0.5 million and $0.6 million for the three months ended December 31, 2013 and 2012, respectively, and were $1.7 million and $2.1 million for the nine months ended December 31, 2013 and 2012, respectively.

Advertising Costs

Advertising costs include the costs of producing and communicating advertisements. The costs of producing advertisements are expensed as incurred and the costs of communicating advertising are expensed over the period of communication. Total advertising costs for the three months ended December 31, 2013 and 2012 included in selling, general and administrative expenses were $0.4 million and $0.2 million, respectively, and were $1.2 million and $0.6 million for the nine months ended December 31, 2013 and 2012, respectively.

Product Recall

The Company establishes reserves for product recalls on a product-specific basis when circumstances giving rise to the recall become known. The Company, when establishing reserves for a product recall, considers cost estimates for any fees and incentives to customers for their effort to return the product, freight and destruction charges for returned products, warehouse and inspection fees, repackaging materials, point-of-sale materials and other costs including costs incurred by contract manufacturers. Additionally, the Company estimates product returns from consumers and customers across distribution channels, utilizing third-party data and other assumptions. These factors are updated and re-evaluated each period and the related reserves are adjusted when these factors indicate that the recall reserves are either insufficient to cover or exceed the estimated product recall expenses.

Significant changes in the assumptions used to develop estimates for product recall reserves could affect key financial information, including accounts receivable, inventory, accrued liabilities, net sales, gross profit, operating expenses and net income. In addition, estimating product recall reserves requires a high degree of judgment in areas such as estimating consumer

8

Annie’s, Inc.

Notes to Condensed Consolidated Financial Statements

(unaudited)

returns, shelf and in-stock inventory at retailers across distribution channels, fees and incentives to be earned by customers for their effort to return the products, future freight rates and consumers’ claims.

3. Initial Public Offering (IPO)

On April 2, 2012, the Company closed its IPO, in which it sold 950,000 shares at an offering price of $19.00 per share and raised $11.1 million in net proceeds after deducting underwriting discounts and commissions of $1.3 million and other offering expenses of $5.6 million. In addition, certain of the Company’s stockholders, including funds affiliated with Solera Capital, LLC, sold 4.8 million shares at the $19.00 offering price in the IPO. The Company sometimes refers to Solera Capital, LLC and its affiliates as Solera in this Quarterly Report on Form 10-Q.

Immediately prior to the closing of the IPO, the outstanding shares of convertible preferred stock were automatically converted into 15,221,571 shares of common stock, the Company’s outstanding convertible preferred stock warrant was automatically converted into a common stock warrant to purchase a total of 80,560 shares of common stock and the related convertible preferred stock warrant liability was reclassified to additional paid-in capital.

4. Balance Sheet Components

Inventory

Inventory is comprised of the following (in thousands):

	December 31, 2013		March 31, 2013
Raw materials	$	2,659	$	1,391
Work in process	1,494		2,142
Finished goods	19,254		11,614
Inventory	$	23,407	$	15,147

The increase in inventory levels as of December 31, 2013 reflects the buildup in advance of the fourth quarter, which historically has been the Company's peak sales season.

Property and Equipment, Net

Property and equipment, net are comprised of the following (in thousands):

	December 31, 2013			March 31, 2013
Equipment and automotive	$	3,897		$	2,959
Software	2,570			2,410
Leasehold improvements	1,342			1,195
Plates and dies	333			244
Total property and equipment	8,142			6,808
Less: Accumulated depreciation and amortization	(2,745		)	(1,760		)
Construction in progress	809			1,090
Property and equipment, net	$	6,206		$	6,138

The Company incurred depreciation expense of $383,000 and $990,000 for the three and nine months ended December 31, 2013, respectively. The depreciation expense for the same periods in the prior year was $271,000 and $704,000, respectively.

9

Annie’s, Inc.

Notes to Condensed Consolidated Financial Statements

(unaudited)

Intangible Assets, Net

Intangible assets, net are comprised of the following (in thousands):

	December 31, 2013							March 31, 2013
	Gross					Net		Gross					Net
	Carrying		Accumulated			Carrying		Carrying		Accumulated			Carrying		Useful
	Amount		Amortization			Amount		Amount		Amortization			Amount		Lives
Product formulas	$	1,023	$	(106	)	$	917	$	1,023	$	(68	)	$	955	5 - 25 years
Other intangible assets	189		(35		)	154		189		(28		)	161		5 - 25 years
Total	$	1,212	$	(141	)	$	1,071	$	1,212	$	(96	)	$	1,116

The Company incurred amortization expense of $15,000 and $45,000 on its intangible assets during the three and nine months ended December 31, 2013. The amortization expense for the same periods over the prior year was $15,000 and $45,000, respectively.

The estimated future amortization expense relating to intangible assets for the remainder of fiscal 2014, for each of the next five years through fiscal 2019 and thereafter is $15,000, $60,000 and $756,000, respectively.

Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets as of December 31, 2013 and March 31, 2013 include receivables from contract manufacturers and suppliers of $4.2 million and $3.9 million, respectively.

Accrued Liabilities

The following table shows the components of accrued liabilities (in thousands):

	December 31, 2013		March 31, 2013
Payroll and employee-related expenses	$	2,903	$	3,779
Accrued trade expenses	2,394		2,299
Inventory received not invoiced	2,720		4,038
Deferred rent	249		260
Brokerage commissions	320		407
Other accrued liabilities	518		1,238
Total accrued liabilities	$	9,104	$	12,021

5. Credit Facility

In December 2011, the Company entered into a second amended and restated loan agreement (as amended from time to time, the "Credit Agreement") with Bank of America, N. A. that, among other things, provided for an increase in its revolving credit facility to $20.0 million and an extension of the term through August 2014. In March 2013, the Company entered into an amendment to its Credit Agreement. This amendment provides for, among other things, an increase in the credit facility to $40.0 million and an extension of the term through August 2016. On November 5, 2013, the Company entered into another amendment to its Credit Agreement. This amendment provides for, among other things, consent for the Company to create a limited liability company and guarantee performance of the limited liability company in the event and to the extent the Company assigns to the limited liability company any of its rights or obligations under the Purchase Agreement dated November 5, 2013 among the Company, Safeway Inc. and Safeway Australia Holdings, LLC (see Note 16). Additionally, the amendment provides for the issuance of letters of credit and revises certain covenants and representations and warranties of the Company under the Credit Agreement. In connection with this amendment, Annie’s Baking, LLC, became a party to the Credit Agreement pursuant to a Joinder Agreement dated November 22, 2013. The credit facility is collateralized by substantially all of the Company’s assets.

10

Annie’s, Inc.

Notes to Condensed Consolidated Financial Statements

(unaudited)

The Company may select from three interest rate options for borrowings under the credit facility: (i) LIBOR (as defined in the Credit Agreement) plus 1.25%, (ii) IBOR (as defined in the Credit Agreement) plus 1.25% or (iii) Prime Rate (as defined in the Credit Agreement). Weighted average interest was 1.4% for each of the three and nine months ended December 31, 2013, respectively. Weighted average interest was 1.5% for each of the three and nine months ended December 31, 2012. The Company is required to pay a commitment fee on the unused credit facility commitments, if the outstanding balance is less than half the commitment, at an annual rate ranging from 0.25% to 0.40% depending on the utilization rate. As of December 31, 2013 and March 31, 2013, there was $40.0 million and $33.0 million, respectively, of borrowings available under the credit facility. Interest is payable monthly.

The Credit Agreement contains restrictions on, among other things, the Company’s ability to incur additional indebtedness, pay dividends or make other distributions and make investments and loans. The Credit Agreement also limits the Company’s ability to make capital expenditures in excess of $15.0 million. The Credit Agreement requires that the Company maintain a Funded Debt (as defined in the Credit Agreement) to Adjusted EBITDA (as defined in the Credit Agreement) ratio of not more than 2.75 to 1.0 and a minimum Net Worth (as defined in the Credit Agreement) equal to at least $50.0 million, plus 30% of earnings after taxes earned each quarter (if positive), beginning with the June 2013 quarterly earnings. The Credit Agreement requires the Company to submit interim and annual financial statements by specified dates after each reporting period. The Company was in compliance with the covenants as of December 31, 2013 and March 31, 2013.

6. Related Party Transactions

Agreements with Solera Capital, LLC

The Company had an advisory services agreement with Solera, which it terminated upon the consummation of the IPO and as such the Company paid Solera a one-time termination fee of $1.3 million in April 2012.

Additionally, the Company is a party to an amended and restated registration rights agreement dated as of November 14, 2005, or Registration Rights Agreement, relating to shares of common stock of the Company held by certain affiliates of Solera and certain other stockholders. As discussed further below, on November 18, 2013 Solera completed the sale of its shares entitled to registration under this agreement.

On August 6, 2012, the Company closed a secondary public offering, in which certain stockholders, including Solera, sold 3,649,976 shares of common stock of the Company at an offering price of $39.25 per share. The Company did not receive any proceeds from the sale of shares by the selling stockholders. The offering expenses incurred by the Company were $0.7 million, including legal, accounting and various other fees associated with the registration and sale of common stock sold in the secondary public offering.

On November 18, 2013, the Company closed a secondary public offering in which Solera sold remaining 2,537,096 shares of common stock of the Company at an offering price of $47.95 per share. The Company did not receive any proceeds from the sale of shares by Solera. The offering expenses incurred by the Company were $0.3 million in the nine months ended December 31, 2013, including legal, accounting and various other fees associated with the registration and sale of common stock of the Company sold in the secondary public offering.

11

Annie’s, Inc.

Notes to Condensed Consolidated Financial Statements

(unaudited)

7. Commitments and Contingencies

Lease Commitments

The Company leases its offices and other equipment under non-cancelable operating leases that expire through fiscal year 2019. Rent expense for non-cancelable operating leases with scheduled rent increases is recognized on a straight-line basis over the lease term. Rent expense for the three and nine months ended December 31, 2013 was $155,000 and $461,000, respectively. Rent expense for the three and nine months ended December 31, 2012 was $146,000 and $386,000, respectively.

Future minimum lease payments under the non-cancelable operating leases as of December 31, 2013 are as follows (in thousands):

	Lease Payments
Three Months Ending March 31, 2014	$	166
Fiscal Year Ending March 31:
2015	675
2016	673
2017	669
2018	662
2019	586
Total future minimum lease payments	$	3,431

Purchase Commitments

The Company has material non-cancelable purchase commitments, directly or through contract manufacturers, to purchase ingredients to be used in the future to manufacture its products. As of December 31, 2013, the Company’s purchase commitments totaled $15.9 million, which will substantially be incurred within a year.

In September 2011, the Company entered into an agreement with its contract warehousing company that includes minimum overhead fees of $200,000 annually beginning April 1, 2012 through June 30, 2015. As of December 31, 2013, the remaining obligation under the agreement for overhead fees was $300,000.

In November 2011, the Company entered into an agreement with one of its contract manufacturers for the purchase of product formulas for a purchase price of $2.0 million. The agreement requires annual payments of at least $150,000 in each of the first six years of the agreement with the balance of the $2.0 million payment due at the end of the seven-year term in November 2018. As of December 31, 2013, the Company’s remaining obligation for product formulas was $1.7 million.

Indemnifications

In the normal course of business, the Company enters into contracts that contain a variety of representations and provide for general indemnifications. The Company’s exposure under these agreements is unknown because it involves claims that may be made against the Company in the future but have not yet been made. The Company has not paid any significant claims or been required to defend any action related to its indemnification obligations, and, accordingly, the Company believes that the estimated fair value of these indemnification obligations is minimal and has not accrued any amounts for these obligations.

Legal Matters

On December 6, 2013, a private organization called the Center for Environmental Health (“CEH”) sued the Company and its subsidiary, Annie’s Homegrown, Inc., in Superior Court of the State of California in the County of Alameda under California Health & Safety Code §§ 25249.5 et seq. (commonly referred to as “Proposition 65”). CEH claims that warnings are required in California under Proposition 65 for alleged exposures to lead and lead compounds from cookies that contain ginger or molasses, including Annie’s Gluten-Free Ginger Snap Bunny Cookies. CEH is seeking injunctive relief, civil penalties of $2,500 per violation per day and its attorneys’ fees and costs. The lawsuit, entitled Mondelez International, Inc., et al., Alameda County Superior Court Case No. RG13-677800, names nine other companies that are either suppliers or retailers of ginger- or molasses-containing cookies. The Company cannot at this time reasonably estimate a range of exposure, if any, of the potential liability relating to this suit.

12

Annie’s, Inc.

Notes to Condensed Consolidated Financial Statements

(unaudited)

Additionally, from time to time, the Company is subject to claims, assessments or other legal proceedings in the ordinary course of business, including product liability claims, employee claims, and other general liability claims. While it is not feasible to predict or determine the ultimate outcome of these matters, the Company believes that none of these legal proceedings, individually or in the aggregate, will have a material adverse effect on its financial position.

8. Convertible Preferred Stock Warrant

In March 2008, in connection with a prior term loan, the Company had issued a warrant to Hercules Technology II, L.P. (“Hercules”) for the purchase of 80,560 shares of Series A 2005 Convertible Preferred Stock at an exercise price of $8.07 per share. The warrant was immediately exercisable on the date of issuance and was scheduled to expire at the earlier of five years from a qualifying IPO of the Company’s common stock or April 1, 2018. Upon the consummation of the Company’s IPO on April 2, 2012, the warrant became a warrant to purchase 80,560 shares of the Company’s common stock. As such, on April 2, 2012, the Company measured the fair value of the outstanding convertible preferred stock warrant using an option pricing method and recorded a non-cash charge of $13,000 related to the increase in the fair value of the convertible preferred stock warrant in other income (expense), net and the related convertible preferred stock warrant liability was reclassified to additional paid-in capital. On April 12, 2012, Hercules exercised the warrant to purchase 80,560 shares of the Company’s common stock by surrendering 17,367 shares to pay for the exercise. As a result, the Company issued Hercules 63,193 shares of the Company's common stock.

9. Preferred Stock

As of each of December 31, 2013 and March 31, 2013, the Company’s certificate of incorporation authorized 5,000,000 shares of preferred stock, $0.001 par value per share. As of December 31, 2013, no certificate of designations defining the rights and preferences of the preferred stock had been filed and no shares of preferred stock were issued and outstanding.

10. Common Stock

As of each of December 31, 2013 and March 31, 2013, the Company’s certificate of incorporation authorized 30,000,000 shares of common stock, $0.001 par value per share, respectively, of which 16,972,380 and 16,849,016 shares were issued and outstanding, respectively. Each share of the common stock has the right to one vote. The holders of common stock are also entitled to receive dividends if, as and when declared by the Company’s Board of Directors. No dividends were declared or paid during the nine months ended December 31, 2013 and 2012.

11. Stock-Based Compensation

The Company has adopted performance incentive plans (the 2004 Stock Option Plan and the Omnibus Incentive Plan, which together are the “Plans”) under which non-qualified stock options, restricted stock units and performance share units are granted to eligible employees, officers and directors. The Company has also granted non-plan performance based option awards to certain key management. Options granted under Plans to date generally vest over a five-year period from the date of grant. Vested options can be exercised and generally expire ten years after the grant date. The restricted stock units granted to employees vest 50% on the second anniversary of the grant date, and the remaining 50% on the third anniversary of the grant date. The performance share units granted to employees vest based on achievement of required cumulative compounded adjusted diluted earnings per share growth during the stipulated three-year period applicable to a grant. The vesting of stock-based awards is subject to continuance of the employment with or service to the Company.

Stock-based compensation expense included in selling, general and administrative expenses was $251,000 and $230,000 for the three months ended December 31, 2013 and 2012, respectively, and $660,000 and $677,000 for the nine months ended December 31, 2013 and 2012, respectively.

13

Annie’s, Inc.

Notes to Condensed Consolidated Financial Statements

(unaudited)

The following table summarizes the activity of stock options during the nine months ended December 31, 2013:

	Number of Shares		Weighted-Average Exercise Price
Balance at March 31, 2013	1,203,990		$	13.26
Granted	62,387		41.87
Forfeited	(99,066	)	18.28
Exercised	(123,364	)	9.81
Balance at December 31, 2013	1,043,947		$	14.90

The weighted average grant date fair value of employee stock options granted during the nine months ended December 31, 2013 was $15.76 per share. The total intrinsic value of stock options exercised during the nine months ended December 31, 2013 was $4.1 million. The intrinsic value is calculated based on the difference between the exercise price and the fair value of the common stock at time of exercise.

The following table summarizes the activity of unvested restricted stock units and performance share units during the nine months ended December 31, 2013:

Shares-Based Awards	Shares		Weighted-Average Grant Date Fair Value
Unvested at March 31, 2013	71,165		$	21.73
Granted	54,806		41.11
Vested	(4,692	)	45.27
Forfeited	(19,922	)	24.94
Unvested at December 31, 2013	101,357		$	30.49

As of December 31, 2013, there were 70,872 unvested performance share units outstanding, net of actual forfeitures. As of December 31, 2013, the number of shares estimated to be issued at the end of the performance period(s) is a total of 35,441 shares. The maximum number of total shares that could be issued at the end of performance period(s) is 106,313 shares.

As of December 31, 2013, there was $4.0 million of total unrecognized compensation cost related to unvested share-based compensation arrangements which is expected to be recognized over a weighted average period of 3.0 years.

12. Income Taxes

The Company’s effective tax rate increased to 41.3% for the three months ended December 31, 2013, compared to 39.6% for the three months ended December 31, 2012. The effective tax rate was 40.5% for the nine months ended December 31, 2013, compared to 40.4% for the nine months ended December 31, 2012. The effective tax rate is based on a projection of the Company’s annual fiscal year results. The effective tax rate for the three and nine months ended December 31, 2013 was higher than the effective tax rate for the three and nine months ended December 31, 2012 due to the impact of permanent items and federal and state income tax credits.

13. Earnings Per Share

Basic earnings per share is calculated by dividing the net income by the weighted-average number of shares of common stock outstanding for the period. Diluted earnings per share is computed by giving effect to all potentially dilutive securities outstanding during the period. The Company utilizes the treasury stock method to calculate potential common shares that underlie its stock options to purchase common stock and restricted stock units. Performance share units were excluded from potential common shares since no shares were issuable as of December 31, 2013 and March 31, 2013. Certain stock options to purchase our common stock and restricted stock units had an anti-dilutive effect on the earnings per share for the periods presented, and were also excluded.

14

Annie’s, Inc.

Notes to Condensed Consolidated Financial Statements

(unaudited)

The following outstanding shares of potentially dilutive securities were excluded from the computation of diluted earnings per share of common stock for the periods presented, because including them would have been anti-dilutive:

	Three Months Ended December 31,		Nine Months Ended December 31,
	2013	2012	2013	2012
Options to purchase common stock	105,157	2,562	105,157	2,562
Restricted stock units	5,141	—	10,575	6,256
Total	110,298	2,562	115,732	8,818

A reconciliation of the basic and diluted earnings per share attributable to common stockholders is as follows (in thousands except share and per share amounts):

	Three Months Ended December 31,				Nine Months Ended December 31,
	2013		2012		2013		2012
Earnings per share:
Net income	$	2,789	$	1,401	$	10,370	$	7,317
Weighted average shares of common stock outstanding used in computing earnings—basic	16,937,139		17,249,536		16,901,089		17,085,833
Potential dilutive options	444,822		523,881		471,427		609,222
Potential dilutive restricted stock units	16,045		8,303		13,892		7,166
Weighted average shares of common stock outstanding used in computing earnings—diluted	17,398,006		17,781,720		17,386,408		17,702,221
Earnings per share
—Basic	$	0.16	$	0.08	$	0.61	$	0.43
—Diluted	$	0.16	$	0.08	$	0.60	$	0.41

14. Geographic Areas and Product Sales

The Company’s net sales by geographic area, based on the location to which the product was shipped, are summarized as follows (in thousands):

	Three Months Ended December 31,				Nine Months Ended December 31,
	2013		2012		2013		2012
United States	$	44,459	$	34,413	$	138,130	$	111,984
Canada	1,718		1,870		5,737		5,278
	$	46,177	$	36,283	$	143,867	$	117,262

The following table sets forth net sales by product category (in thousands):

	Three Months Ended December 31,				Nine Months Ended December 31,
	2013		2012		2013		2012
Meals	$	23,933	$	16,223	$	70,226	$	52,759
Snacks	17,075		14,908		54,953		47,517
Dressings, condiments and other	5,169		5,152		18,688		16,986
	$	46,177	$	36,283	$	143,867	$	117,262

All of the Company’s long-lived assets are located in the U.S.

15

Annie’s, Inc.

Notes to Condensed Consolidated Financial Statements

(unaudited)

15. Product Recall

In January 2013, the Company announced a voluntary product recall of certified organic and made with organic pizza products due to the possible presence of fragments of flexible metal mesh from a faulty screen at a third-party flour mill. The Company initiated the recall of all lots of pizza product manufactured with this supplier’s flour from its first purchase from the supplier in May 2012. The Company recorded certain items associated with the recall in its financial results for the three and nine months ended December 31, 2013 and 2012.

The Company recorded the estimated customer and consumer returns as a reduction of net sales, related costs associated with product returns, destruction charges, inventory write-off and costs incurred by contract manufacturers as cost of sales, and administrative costs associated with the recall such as legal expenses as selling, general and administrative expenses. The Company recorded $0.4 million and $1.6 million for insurance recoveries in connection with the product recall in the three and nine months ended December 31, 2013, respectively. The impact of the recall-related charges and related insurance recoveries in the three and nine months ended December 31, 2013 and 2012 is as follows (in thousands except per share amount):

	Three Months Ended December 31,						Nine Months Ended December 31,
	2013			2012			2013			2012
Benefit to/(reduction of) net sales	$	104		$	(1,570	)	$	855		$	(1,570	)
Benefit to/(incremental) cost of sales	280			(690		)	533			(690		)
Benefit to/(incremental) selling, general and administrative expenses	(7		)	—			(18		)	—
Total benefit to/(reduction of) income before income taxes	$	377		$	(2,260	)	$	1,370		$	(2,260	)
Benefit to/(reduction of) net income	$	224		$	(1,346	)	$	827		$	(1,346	)
Benefit to/(reduction of) net income per diluted share	$	0.01		$	(0.08	)	$	0.05		$	(0.08	)

The Company does not expect any significant further additional costs associated with the voluntary product recall. The Company expects to receive additional recoveries from the involved insurance carriers in future quarters.

16. Planned Acquisition

On November 5, 2013, the Company entered into an agreement of purchase and sale (the "Purchase Agreement") with Safeway Inc. and Safeway Australia Holdings, Inc. (together the “Selling Parties”) to acquire a snack manufacturing plant in Joplin, Missouri (the “Joplin Plant”) for $6.0 million of cash, plus the value of inventory and supplies at closing (calculated based on the Selling Parties’ costs and currently estimated at approximately $4.0 million). The Company expects to fund the acquisition with cash from operations and, if necessary, by drawing under its revolving credit facility. The Company expects to close the acquisition in the first quarter of fiscal 2015. The Joplin Plant has been the primary manufacturer of the Company’s cookie and cracker products for more than ten years. Company products produced in the Joplin Plant currently account for over 50% of its total snacks net sales and represent the majority of the Joplin Plant’s total production volume. In connection with the closing of the acquisition, the Company expects to enter into a three-year supply agreement with an affiliate of Safeway Inc., pursuant to which the Company will manufacture products for the affiliate. Further, in connection with the planned acquisition, on November 7, 2013, the Company deposited $300,000 in an escrow account with the title insurance company. This amount is reflected as restricted cash on the condensed consolidated balance sheet at December 31, 2013.

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ITEM 2 – MANAGEMENT’S DISCUSSION AND ANALYSIS

OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the unaudited condensed consolidated financial statements and the related notes thereto included elsewhere in this Quarterly Report on Form 10-Q ("Form 10-Q") and the audited consolidated financial statements and notes thereto and management’s discussion and analysis of financial condition and results of operations for the year ended March 31, 2013 (“fiscal 2013”) included in our Annual Report on Form 10-K ("Form 10-K") filed with the SEC on June 14, 2013. This Form 10-Q contains “forward-looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, (the “Exchange Act”). These statements are often identified by the use of words such as “may,” “will,” “expect,” “believe,” “anticipate,” “intend,” “could,” “should,” “estimate,” or “continue,” and similar expressions or variations. Such forward-looking statements are subject to risks, uncertainties and other factors that could cause actual results and the timing of certain events to differ materially from future results expressed or implied by such forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those in this Form 10-Q relating to the acquisition of the Joplin manufacturing plant and those in our Form 10-K discussed in the section titled “Risk Factors” including risks relating to competition; new product introductions; implementation of our growth strategy; our brand; our reputation; product liability claims; product recalls and related insurance recoveries (if any); economic disruptions; changes in consumer preferences; ingredient and packaging costs and availability; reliance on a limited number of distributors, retailers, contract manufacturers and third-party suppliers and an outside warehouse facility; efficiency projects; intellectual property and related disputes; regulatory compliance; transportation; our supply-chain; our and our customers’ inventory levels; and seasonality. The forward-looking statements in this Form 10-Q represent our views as of the date of this Form 10-Q. We anticipate that subsequent events and developments will cause our views to change. However, while we may elect to update these forward-looking statements at some point in the future, we have no current intention of doing so except to the extent required by applicable law. You should, therefore, not rely on these forward-looking statements as representing our views as of any date subsequent to the date of this Form 10-Q.

Overview

Annie’s, Inc. is a natural and organic food company with a widely recognized brand, offering consumers great-tasting products in large packaged foods categories. We sell premium products made from high-quality ingredients at affordable prices. We have the number one natural and organic market position in four product lines: macaroni and cheese, snack crackers, fruit snacks and graham crackers.

Our loyal and growing consumer following has enabled us to migrate from our natural and organic roots to a brand sold across the mainstream grocery, mass merchandiser and natural retailer channels. We offer over 135 products and are present in over 26,500 retail locations in the United States and Canada.

Our net sales are derived from the sale of meals, snacks, dressings, condiments and other products primarily under the Annie’s Homegrown and Annie’s Naturals brand names. We have experienced strong growth resulting from our focus on supporting our best-selling items and the introduction of new products.

Gross profit is net of cost of sales, which consists of the costs of ingredients in the manufacture of products, contract manufacturing fees, inventory write-off, packaging costs and in-bound freight charges. Ingredients account for the largest portion of the cost of sales followed by contract manufacturing fees and packaging costs.

Our selling, general and administrative expenses consist primarily of marketing and advertising expenses, freight and warehousing costs, wages, related payroll and employee benefit expenses, stock-based compensation, commissions to outside sales representatives, legal and professional fees, travel expenses, other facility related costs, such as rent and depreciation, and consulting expenses. The primary components of our marketing and advertising expenses include trade advertising, samples, consumer events, sales data, consumer research and search engine and digital advertising.

Planned Acquisition

On November 5, 2013, we entered into an agreement with Safeway Inc. and Safeway Australia Holdings, Inc. (together the “Selling Parties”) to acquire a snack manufacturing plant in Joplin, Missouri (the “Joplin Plant”) for $6.0 million, plus the value of inventory and supplies at closing (calculated based on the Selling Parties’ costs and currently estimated at approximately $4.0 million). We expect to fund the acquisition with cash from operations and, if necessary, by drawing under our revolving credit facility. We expect to close the acquisition in the first quarter of fiscal 2015. The Joplin Plant has been the primary manufacturer of our cookie and cracker products for more than ten years. Our products produced in the Joplin Plant currently account for over 50% of our total snacks net sales and represent the majority of the Joplin Plant’s total production volume. In connection with the closing of the acquisition, we expect to enter into a three-year supply agreement with an

17

affiliate of Safeway Inc., pursuant to which we will manufacture products for the affiliate. Further, in connection with the planned acquisition, on November 7, 2013, we deposited $300,000 in an escrow account with the title insurance company. This amount is reflected as restricted cash on the condensed consolidated balance sheet at December 31, 2013.

Large Accelerated Filer

At the end of fiscal year 2014, we will be deemed to be a “large accelerated filer,” as defined in Rule 12b-2 under the Securities Exchange Act of 1934, as amended, or the Exchange Act, and as a result, we will cease to be an “emerging growth company,” as defined in the JOBS Act. As a result, we will no longer be exempted from the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 and our independent registered public accounting firm will be required to evaluate and report on internal control over financial reporting. In connection with the auditor attestation, we expect to incur additional fees, consulting and other costs of approximately $0.3 million in fiscal 2014 as compared to fiscal 2013.

Voluntary Product Recall

We first began shipping organic frozen pizza in January 2012 and made with organic frozen pizza first shipped during second quarter of fiscal 2013. In January 2013, we announced a voluntary product recall of our certified organic and made with organic pizza products. The voluntary product recall was a result of our contract manufacturer for pizza crusts identifying small metal fragments in the pizza dough during a manufacturing run and in some finished pizza crusts made on the same day. We immediately halted production and began investigating the issue. Soon thereafter, we determined that the small metal fragments originated at the third-party flour mill from where we sourced our pizza flour. We then initiated a recall of all lots of pizza product manufactured with this supplier’s flour from our first purchase from the supplier in May 2012.

Direct costs of the voluntary product recall include customer and consumer returns, costs associated with returned product, costs incurred by our contract manufacturers, incremental costs associated with short-term sourcing of replacement flour, destruction charges and inventory write-off, retailer margin and customer fees and incentives. We also incurred administrative costs such as legal expenses, accounting fees and public relations expenses.

To date, we have recorded a total of $2.9 million in expenses and a total of $2.0 million in insurance recoveries related to the product recall. In the nine months ended December 31, 2013, we recorded $1.6 million for insurance recoveries and $0.1 million in reduction of net sales reserve in connection with the recall. We expect to recover additional amounts from the insurance providers in future quarters. Recoveries are recorded to offset the charges once recovery is probable.

Seasonality

Historically, we have experienced greater net sales in the second and fourth fiscal quarters than in the first and third fiscal quarters due to our customers’ and retailers’ merchandising and promotional activities around the back-to-school and spring seasons. Concurrently, inventory levels and working capital requirements generally increase during the first and third fiscal quarters of each fiscal year to support higher levels of net sales in the subsequent quarters. We anticipate that this seasonal impact on our net sales and working capital is likely to continue. Accordingly, our results of operations for any particular quarter are not indicative of the results we expect for the full year.

Trends and Other Factors Affecting Our Business

The growth rates for the U.S. natural and organic food market have been, and are expected to continue to be, higher than those for the overall U.S. food market. We believe growth in the natural and organic food market is driven by various factors, including heightened awareness of the role that food and nutrition play in long-term health and wellness. Many consumers prefer natural and organic products due to increasing concerns over the purity and safety of food as a result of the presence of pesticide residues, growth hormones and artificial and genetically engineered ingredients in the foods we eat. In this growing market, we expect competition from other natural and organic packaged food companies as well as mainstream conventional packaged food companies to increase, as they may seek to introduce or have introduced products in our key categories or seek to make existing products more attractive to the natural and organic consumer. We continue to experience greater consumer demand for natural and organic food products and increasing awareness of the Annie’s brand, which has contributed to increased growth in net sales.

Our top-line growth continues to be driven by our increased penetration of mainstream grocery and mass merchandiser channels, improved placement in the mainstream grocery channel and continued product innovation which includes adding new flavors and sizes to existing lines as well as introduction of new product lines. In June 2013, we entered into the single-serve microwavable cup segment of the macaroni and cheese category and in August 2013, we entered into family-size frozen entrées. In December 2013, we entered into gluten free chewy granola bars.

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We purchase finished products from our contract manufacturers. With an industry-wide commodity cost escalation starting in fiscal 2008, we became more directly involved in the sourcing of the ingredients for our products. This allowed us to consolidate ingredient sourcing across contract manufacturers in order to negotiate more favorable pricing on ingredients and, in some cases, to lock in ingredient pricing for typically six to 12 months forward through non-cancelable purchase commitments, directly or through contract manufacturers. In fiscal 2013, our contracted ingredients represented approximately 50% of our materials costs and over 31% of our cost of sales. These efforts mitigated the impact of volatile and increasing commodity costs on our business. We plan to continue to expand our portfolio of contracted ingredients and negotiate pricing agreements for future purchases to allow us sufficient time to respond to changes in our ingredient costs over time.

Additionally, we have invested significant time and energy to offset higher costs and achieve cost reductions and productivity improvements in our supply chain. These efficiency projects have focused on selecting more cost-effective contract manufacturers, negotiating lower tolling fees, consolidating in-bound freight, leveraging warehouse expense and reducing ingredient and packaging costs through increased volume buys, contract consolidation, direct purchasing, investment in capital equipment at our contract manufacturers to improve line throughput and reduce production costs, and price negotiation. We believe that our planned acquisition of the Joplin Plant is the next evolution of our hybrid model and provides us with the opportunity over the long-term to benefit from fixed cost leverage as we drive snacks volume.

While our cost structure continues to benefit from ongoing productivity and cost reduction initiatives, we have experienced increased margin pressure in fiscal 2014 resulting from several factors, including: continued input cost inflation; more limited price increases compared to prior years; a faster pace of product innovation; customer and product mix changes; increased inventory obsolescence and continued distribution and market share growth in a competitive food retailing environment. Although commodity costs for many conventional ingredients have recently moderated or declined, we have not yet experienced similar cost changes to our ingredients and continue to experience year-over-year commodity increases, particularly for organic wheat.

Selling, general and administrative expenses have increased as a result of the investment we have made in scaling our organization and adding headcount to support our growth. Some of our selling, general and administrative expenses are variable with volume, including freight and warehouse expenses and commissions paid to our sales brokers. In addition, we continue to make investments in marketing to drive trial of our products, promote awareness of our brand, and compete effectively against conventional as well as natural and organic brands, and in research and development to support our robust innovation pipeline.

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Results of Operations

The following table sets forth items included in our consolidated statements of operations in dollars and as a percentage of net sales for the periods presented:

	Three Months Ended   December 31,						% of Net Sales				Nine Months Ended   December 31,						% of Net Sales
	2013			2012			2013		2012		2013			2012			2013		2012
	(in thousands, except for percentages)
Net sales	$	46,177		$	36,283		100.0	%	100.0	%	$	143,867		$	117,262		100.0	%	100.0	%
Cost of sales	27,951			23,267			60.5	%	64.1	%	88,978			72,539			61.8	%	61.9	%
Gross profit	18,226			13,016			39.5	%	35.9	%	54,889			44,723			38.2	%	38.1	%
Operating expenses:
Selling, general and administrative expenses	13,421			10,687			29.1	%	29.5	%	37,286			32,437			25.9	%	27.7	%
Total operating expenses	13,421			10,687			29.1	%	29.5	%	37,286			32,437			25.9	%	27.7	%
Income from operations	4,805			2,329			10.4	%	6.4	%	17,603			12,286			12.2	%	10.5	%
Interest expense	(80		)	(40		)	(0.2	)%	(0.1	)%	(255		)	(120		)	(0.2	)%	(0.1	)%
Other income (expense), net	30			31			0.1	%	0.1	%	88			116			0.1	%	0.1	%
Income before provision for income taxes	4,755			2,320			10.3	%	6.4	%	17,436			12,282			12.1	%	10.5	%
Provision for income taxes	1,966			919			4.3	%	2.5	%	7,066			4,965			4.9	%	4.2	%
Net income	$	2,789		$	1,401		6.0	%	3.9	%	$	10,370		$	7,317		7.2	%	6.2	%

Our discussion of our results of operations in this Form 10-Q includes certain adjusted net sales, gross profit, gross margin and net income figures. These figures are non-GAAP financial measures. We calculate these non-GAAP figures by eliminating the impact of our January 2013 voluntary product recall and related insurance recoveries, costs associated with our planned acquisition of the Joplin Plant, secondary offering costs and the change in fair value of the convertible preferred stock warrant liability, which we do not consider to be indicative of our ongoing operations. We believe these non-GAAP figures provide additional metrics to evaluate our operations and, when considered with both our GAAP results and the related reconciliation to the most directly comparable GAAP measure, provide a more complete understanding of our business than could be obtained absent this disclosure. We use these non-GAAP figures, together with financial measures prepared in accordance with GAAP, to assess our operating performance, to provide meaningful comparisons of operating performance across periods, to enhance our understanding of our core operating performance and to compare our performance to that of our peers and competitors. We believe that these non-GAAP figures are also useful to investors in assessing the operating performance of our business without the effect of the items described above. These non-GAAP figures are subject to inherent limitation as they reflect the exercise of judgment by management in determining how they are formulated. Further, our computation of these non-GAAP figures is likely to differ from methods used by other companies in computing similarly titled or defined terms, limiting the usefulness of these measures. These non-GAAP figures should not be considered in isolation or as alternatives to GAAP financial measures and investors should not rely on any single financial measure to evaluate our business.

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The table below reconciles these non-GAAP figures to the most directly comparable GAAP financial measures for the three months ended December 31, 2013 and 2012:

	Three months ended December 31, 2013									Three months ended December 31, 2012
	Net Sales			Gross Profit			Net Income			Net Sales		Gross Profit		Net Income
GAAP financial measures	$	46,177		$	18,226		$	2,789		$	36,283	$	13,016	$	1,401
Increase/(decrease) of net sales reserve related to product recall	(13		)	(13		)	(13		)	1,570		1,570		1,570
Incremental cost of sales related to product recall	—			62			62			—		690		690
Recoveries from insurance carrier related to product recall:
Net sales	(91		)	(91		)	(91		)	—		—		—
Cost of sales	—			(342		)	(342		)	—		—		—
Selling, general and administrative expenses	—			—			(7		)	—		—		—
Administrative costs related to product recall	—			—			14			—		—		—
Costs associated with our planned acquisition of the Joplin Plant	—			—			249			—		—		—
Secondary offering costs	—			—			202			—		—		—
Change in fair value of convertible preferred stock warrant liability	—			—			—			—		—		—
Provision for income taxes	—			—			29			—		—		(914		)
Non-GAAP figures	$	46,073		$	17,842		$	2,892		$	37,853	$	15,276	$	2,747

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The table below reconciles these non-GAAP figures to the most directly comparable GAAP financial measures for the nine months ended December 31, 2013 and 2012:

	Nine months ended December 31, 2013									Nine months ended December 31, 2012
	Net Sales			Gross Profit			Net Income			Net Sales		Gross Profit		Net Income
GAAP financial measures	$	143,867		$	54,889		$	10,370		$	117,262	$	44,723	$	7,317
Increase/(decrease) of net sales reserve related to product recall	(134		)	(134		)	(134		)	1,570		1,570		1,570
Incremental cost of sales related to product recall	—			279			279			—		690		690
Recoveries from insurance carrier related to product recall:
Net sales	(721		)	(721		)	(721		)	—		—		—
Cost of sales	—			(832		)	(832		)	—		—		—
Selling, general and administrative expenses	—			—			(47		)	—		—		—
Administrative costs related to product recall	—			—			65			—		—		—
Costs associated with our planned acquisition of the Joplin Plant	—			—			411			—		—		—
Secondary offering costs	—			—			288			—		—		704
Change in fair value of convertible preferred stock warrant liability	—			—			—			—		—		13
Provision for income taxes	—			—			351			—		—		(1,199		)
Non-GAAP figures	$	143,012		$	53,481		$	10,030		$	118,832	$	46,983	$	9,095

Three Months Ended December 31, 2013 Compared to Three Months Ended December 31, 2012

Net Sales

	Three Months Ended December 31,				Change				% of Net Sales
	2013 (1)		2012 (2)		$		%		2013		2012
	(in thousands, except for percentages)
Meals	$	23,933	$	16,223	$	7,710	47.5	%	51.8	%	44.7	%
Snacks	17,075		14,908		2,167		14.5	%	37.0	%	41.1	%
Dressings, condiments and other	5,169		5,152		17		0.3	%	11.2	%	14.2	%
Net sales	$	46,177	$	36,283	$	9,894	27.3	%	100.0	%	100.0	%

_________

⁽¹⁾ Net sales for the three months ended December 31, 2013 included $0.1 million insurance recoveries related to product recall.

⁽²⁾ Net Sales for the three months ended December 31, 2012 included a $1.6 million reduction in net sales due to product recall.

Net sales of $46.2 million increased $9.9 million, or 27.3%, in the three months ended December 31, 2013 compared to the same period in the prior year. This increase was largely driven by volume through distribution gains and our mainline placement initiative, primarily impacting mass merchandiser and mainstream grocery channels, as well as the impact of the pizza recall. Net sales in the natural channel grew modestly in the three months ended December 31, 2013. Higher average selling prices contributed approximately one percent to net sales growth, excluding the impact of the pizza recall.

The increase in net sales reflects a $7.7 million and $2.2 million increase for meals and snacks, respectively. The increase in meals was predominantly driven by strong growth in natural and gluten-free macaroni and cheese products. Additionally,

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sales of microwavable cup macaroni and cheese (which was introduced in June 2013), pizza, and frozen entrées (which were introduced in August 2013) contributed to the growth in meals. The increase in snacks was primarily due to growth in our fruit snacks. Sales in the dressings, condiments and other category were largely unchanged compared to the prior year period.

Excluding the impact of our voluntary product recall, our net sales would have increased $8.2 million, or 21.7%, to $46.1 million in the three months ended December 31, 2013 compared to $37.9 million in the three months ended December 31, 2012.

Gross Profit

	Three Months Ended December 31,						Change
	2013			2012			$		%
	(in thousands, except for percentages)
Cost of sales	$	27,951		$	23,267		$	4,684	20.1	%
Gross profit	$	18,226		$	13,016		$	5,210	40.0	%
Gross margin %	39.5		%	35.9		%

Gross profit of $18.2 million increased $5.2 million, or 40.0%, in the three months ended December 31, 2013 compared to the same period in the prior year, primarily driven by higher net sales and the impact of voluntary product recall, partially offset by higher commodity costs and increased inventory obsolescence.

Gross margin increased 3.6 percentage points to 39.5% in the three months ended December 31, 2013 from 35.9% in the three months ended December 31, 2012. The increase in gross margin is attributable to inclusion of a $1.6 million reduction in net sales and a $0.7 million increase in cost of sales associated with our voluntary product recall in the three months ended December 31, 2012, as well as insurance recoveries that benefited net sales by $0.1 million and cost of sales by $0.3 million in the three months ended December 31, 2013. Higher average selling prices and efficiency gains also contributed to the increase in gross margin. However, such gains were more than offset by higher commodity costs and increased inventory obsolescence.

Excluding the impact of the voluntary product recall, our gross profit would have increased $2.5 million, or 16.8%, to $17.8 million in the three months ended December 31, 2013 from $15.3 million in the three months ended December 31, 2012 and gross margin would have decreased 1.7 percentage points to 38.7% in the three months ended December 31, 2013 from 40.4% in the three months ended December 31, 2012.

Operating Expenses: Selling, general and Administrative Expenses (SG&A)

	Three Months Ended December 31,						Change
	2013			2012			$		%
	(in thousands, except for percentages)
Operating expenses:
SG&A	$	13,421		$	10,687		$	2,734	25.6	%
SG&A as a percentage of net sales	29.1		%	29.5		%

SG&A of $13.4 million increased $2.7 million, or 25.6%, in the three months ended December 31, 2013 compared to the same period in the prior year. This increase was due primarily to an increase in selling and marketing expense, as well as higher payroll expense resulting from increased headcount to support our growth. In addition, during the three months ended December 31, 2013, we incurred $0.2 million in legal, consulting and other costs associated with our planned acquisition of the Joplin Plant and $0.2 million for legal, accounting and various other fees associated with the registration and sale of common stock by Solera.

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Income from Operations

	Three Months Ended December 31,						Change
	2013			2012			$		%
	(in thousands, except for percentages)
Income from operations	$	4,805		$	2,329		$	2,476	106.3	%
Income from operations as a percentage of net sales	10.4		%	6.4		%

As a result of the factors discussed above, income from operations of $4.8 million increased $2.5 million, or 106.3%, in the three months ended December 31, 2013 compared to the same period in the prior year, and as a percentage of net sales increased 4.0 percentage points to 10.4%.

Interest Expense

	Three Months Ended December 31,						Change
	2013			2012			$			%
	(in thousands, except for percentages)
Interest expense	$	(80	)	$	(40	)	$	(40	)	100.0	%

Interest expense increased in the three months ended December 31, 2013 compared to the three months ended December 31, 2012 due to higher non-utilization fees under our revolving credit facility, which was increased to $40.0 million from $20.0 million in March 2013.

Other Income

	Three Months Ended December 31,				Change
	2013		2012		$			%
	(in thousands, except for percentages)
Other income	$	30	$	31	$	(1	)	(3.2	)%

Other income during the three months ended December 31, 2013 and 2012 reflects royalty income.

Provision for income taxes

	Three Months Ended December 31,						Change
	2013			2012			$		%
	(in thousands, except for percentages)
Provision for income taxes	$	1,966		$	919		$	1,047	113.9	%
Effective tax rate	41.3		%	39.6		%

Our effective tax rate increased to 41.3% for the three months ended December 31, 2013, compared to 39.6% for the three months ended December 31, 2012. The effective tax rate is based on a projection of our annual fiscal year results. The increase is due to the impact of permanent items partially offset by the federal and state income tax credits. We expect our full year effective tax rate for fiscal 2014 to be approximately 40% to 41%.

Net income

	Three Months Ended December 31,				Change
	2013		2012		$		%
	(in thousands, except for percentages)
Net income	$	2,789	$	1,401	$	1,388	99.1	%

As a result of the factors discussed above, net income of $2.8 million increased $1.4 million, or 99.1%, in the three months ended December 31, 2013 from $1.4 million in the three months ended December 31, 2012.

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Excluding the impact of our voluntary product recall, costs associated with our planned acquisition of the Joplin Plant and secondary offering costs, our net income increased $0.2 million, or 5.3%, to $2.9 million in the three months ended December 31, 2013 from $2.7 million in the three months ended December 31, 2012.

Nine Months Ended December 31, 2013 Compared to Nine Months Ended December 31, 2012

Net Sales

	Nine Months Ended December 31,				Change				% of Net Sales
	2013 (1)		2012 (2)		$		%		2013		2012
	(in thousands, except for percentages)
Meals	$	70,226	$	52,759	$	17,467	33.1	%	48.8	%	45.0	%
Snacks	54,953		47,517		7,436		15.6	%	38.2	%	40.5	%
Dressings, condiments and other	18,688		16,986		1,702		10.0	%	13.0	%	14.5	%
Net sales	$	143,867	$	117,262	$	26,605	22.7	%	100.0	%	100.0	%

_________

⁽¹⁾ Net sales for the nine months ended December 31, 2013 included $0.7 million insurance recoveries and $0.1 million of reversal of net sales reserve related to product recall.

⁽²⁾ Net Sales for the nine months ended December 31, 2012 included a $1.6 million reduction in net sales due to product recall.

Net sales of $143.9 million increased $26.6 million, or 22.7%, in the nine months ended December 31, 2013 compared to the same period in the prior year. The increase was largely driven by volume through distribution gains and our mainline placement initiative, primarily impacting mainstream grocery and mass merchandiser channels, as well as the impact of the pizza recall. These gains were partially offset by lower volume in the natural channel, primarily driven by a reduction in inventory carrying levels at one of our major customers. Higher average selling prices contributed approximately one to two percent to net sales growth, excluding the impact of the pizza recall.

The $17.5 million increase in meals was predominantly driven by strong growth in natural and gluten-free macaroni and cheese products. Additionally, microwavable cup macaroni and cheese (which was introduced in June 2013) and sales of frozen entrées (which were introduced in August 2013) contributed to growth in meals. Net sales of meals also benefited from the insurance recoveries and the reversal of net sales reserve mentioned above. The increase in snacks of $7.4 million was primarily due to growth in our fruit snacks, grahams and crackers. The increase of $1.7 million in the dressings, condiments and other category was across the products in this category.

Excluding the impact of our voluntary product recall, our net sales would have increased $24.2 million, or 20.3%, to $143.0 million in the nine months ended December 31, 2013 compared to $118.8 million in the nine months ended December 31, 2012.

Gross Profit

	Nine Months Ended December 31,						Change
	2013			2012			$		%
	(in thousands, except for percentages)
Cost of sales	$	88,978		$	72,539		$	16,439	22.7	%
Gross profit	$	54,889		$	44,723		$	10,166	22.7	%
Gross margin %	38.2		%	38.1		%

Gross profit of $54.9 million increased $10.2 million, or 22.7%, in the nine months ended December 31, 2013 compared to the same period in the prior year, primarily driven by higher net sales and the impact of the voluntary product recall, partially offset by higher commodity costs and increased inventory obsolescence.

Gross margin increased 0.1 percentage point to 38.2% in the nine months ended December 31, 2013 from 38.1% in the nine months ended December 31, 2012. The increase in gross margin is attributable to inclusion of a $1.6 million reduction in net sales and a $0.7 million increase in cost of sales associated with our voluntary product recall in the nine months ended December 31, 2012, as well as insurance recoveries that benefited net sales by $0.7 million and cost of sales by $0.8 million in

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the nine months ended December 31, 2013. Additionally, higher average selling prices and efficiency gains contributed to the increase in gross margin. However, such gains were more than offset by higher commodity costs, mix changes and the impact of inventory obsolescence.

Excluding the impact of our voluntary product recall, our gross profit would have increased $6.5 million, or 13.8%, to $53.5 million in the nine months ended December 31, 2013 from $47.0 million in the nine months ended December 31, 2012 and gross margin would have decreased 2.1 percentage points to 37.4% in the nine months ended December 31, 2013 from 39.5% in the nine months ended December 31, 2012.

Operating Expenses: Selling, General and Administrative Expenses (SG&A)

	Nine Months Ended December 31,						Change
	2013			2012			$		%
	(in thousands, except for percentages)
Operating expenses:
SG&A	$	37,286		$	32,437		$	4,849	14.9	%
SG&A as a percentage of net sales	25.9		%	27.7		%

SG&A of $37.3 million increased $4.8 million, or 14.9%, to $37.3 million in the nine months ended December 31, 2013 compared to the same period in the prior year, due primarily to an increase in payroll expense resulting from increased headcount to support our growth. In addition, during the nine months ended December 31, 2013, we incurred $0.4 million in legal, consulting and other costs associated with our planned acquisition of the Joplin Plant, $0.3 million for legal, accounting and other various other fees associated with the registration and sale of common stock by Solera, and $18,000 in administrative costs associated with the voluntary product recall net of insurance recovery of $47,000. During the nine months ended December 31, 2012, we incurred $0.7 million in legal, accounting and various other fees associated with the registration and sale of common stock in the secondary public offering by certain stockholders including Solera. As a percentage of net sales, SG&A decreased 1.8 percentage points to 25.9% in the nine months ended December 31, 2013 from 27.7% in the nine months ended December 31, 2012 due to overall leverage resulting from strong net sales growth.

Income from Operations

	Nine Months Ended December 31,						Change
	2013			2012			$		%
	(in thousands, except for percentages)
Income from operations	$	17,603		$	12,286		$	5,317	43.3	%
Income from operations as a percentage of net sales	12.2		%	10.5		%

As a result of the factors discussed above, income from operations of $17.6 million increased $5.3 million, or 43.3%, in the nine months ended December 31, 2013 compared to the same period in the prior year, and as a percentage of net sales increased 1.7 percentage points to 12.2%.

Interest Expense

	Nine Months Ended December 31,						Change
	2013			2012			$			%
	(in thousands, except for percentages)
Interest expense	$	(255	)	$	(120	)	$	(135	)	112.5	%

Interest expense increased in the nine months ended December 31, 2013 compared to the nine months ended December 31, 2012 due to higher non-utilization fees under our revolving credit facility, which was increased to $40.0 million from $20.0 million in March 2013.

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Other Income (Expense), Net

	Nine Months Ended December 31,				Change
	2013		2012		$			%
	(in thousands, except for percentages)
Other income (expense), net	$	88	$	116	$	(28	)	(24.1	)%

Other income (expense), net during the nine months ended December 31, 2013 reflects royalty income. Other income (expense), net during the nine months ended December 31, 2012 primarily reflects royalty income partially offset by a non-cash charge of $13,000 related to the increase in the fair value of the convertible preferred stock warrant on April 2, 2012, prior to its conversion into a common stock warrant.

Provision for income taxes

	Nine Months Ended December 31,						Change
	2013			2012			$		%
	(in thousands, except for percentages)
Provision for income taxes	$	7,066		$	4,965		$	2,101	42.3	%
Effective tax rate	40.5		%	40.4		%

Our effective tax remained relatively unchanged from the prior year and is based on a projection of our annual fiscal year results. The slight increase in the effective tax rate for the nine months ended December 31, 2013 was due to the impact of permanent items. We expect our full year effective tax rate for fiscal 2014 to be approximately 40% to 41%.

Net income

	Nine Months Ended December 31,				Change
	2013		2012		$		%
	(in thousands, except for percentages)
Net income	$	10,370	$	7,317	$	3,053	41.7	%

As a result of the factors discussed above, net income increased $3.1 million, or 41.7%, to $10.4 million in the nine months ended December 31, 2013.

Excluding the impact of our voluntary product recall, costs associated with our planned acquisition of the Joplin Plant, secondary offering costs and non-cash charge related to the increase in the fair value of the convertible preferred stock warrant liability, our net income increased $0.9 million, or 10.3%, to $10.0 million in the nine months ended December 31, 2013 from $9.1 million in the nine months ended December 31, 2012.

Liquidity and Capital Resources

	December 31, 2013		March 31, 2013
	(in thousands)
Cash	$	2,986	$	4,930
Accounts receivable, net	18,796		20,015
Inventory	23,407		15,147
Accounts payable	6,784		4,342
Accrued liabilities	9,104		12,021
Working capital(1)	38,426		31,925

(1) Working capital consists of total current assets less total current liabilities

Working capital increase as of December 31, 2013 is driven by inventory build ahead of fourth quarter, which is historically our seasonally largest quarter. Our principal sources of liquidity are our cash and accounts receivable, as well as

27

cash flows from operations. Additionally, we have a credit facility with Bank of America, N.A., which provides for revolving loans and letters of credit up to $40.0 million and is available to us through August 2016. We believe that our cash and accounts receivable and potential cash flows from operations will be sufficient to satisfy our currently anticipated cash requirements through at least the next twelve months. We have historically generated cash from our operations, however, there can be no assurance that our operations will continue to generate cash flows in the future. We use cash generated from our operations to fund our ongoing operations including business expansion and growth.

The following table sets forth, for the periods indicated, our beginning balance of cash, net cash flows provided by (used in) operating, investing and financing activities and our ending balance of cash:

	December 31, 2013			December 31, 2012
	(in thousands)
Cash at beginning of period	$	4,930		$	562
Net cash provided by operating activities	3,750			4,210
Net cash used in investing activities	(1,357		)	(1,498		)
Net cash provided by (used in) financing activities	(4,337		)	9,686
Cash at end of period	$	2,986		$	12,960

Cash Flows from Operating Activities

Net cash provided by operating activities of $3.8 million in the nine months ended December 31, 2013 compared to the same period in the prior year, decreased by $0.5 million. The main drivers of this change include:

• a cash decrease of $9.4 million from change in operating assets and liabilities due primarily to timing, which was partially offset by

• lower excess tax benefit from stock-based compensation of $6.0 million and higher net income of $3.1 million compared to the nine months ended December 31, 2012.

Cash Flows from Investing Activities

Net cash used in investing activities of $1.4 million in the nine months ended December 31, 2013, was lower by $0.1 million compared to the nine months ended December 31, 2012. Drivers of this change included $0.4 million of lower investment in property and equipment, offset by $0.3 million of a deposit placed in an escrow account relating to our planned acquisition of the Joplin Plant.

Cash Flows from Financing Activities

Net cash used in financing activities totaled $4.3 million in the nine months ended December 31, 2013, compared to net cash provided by financing activities of $9.7 million in the nine months ended December 31, 2012, a decrease of $14.0 million. Drivers of this change included:

• net proceeds of $11.1 million received from common shares issued in the IPO, net of issuance costs, in the nine months ended December 31, 2012;

• a decrease in excess tax benefit from stock-based compensation of $6.0 million;

• a decrease in proceeds from exercises of stock options of $2.6 million; which were offset by

• an increase in draw down from the credit facility of $5.7 million.

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Contractual Obligations and Commitments

The following table summarizes our contractual obligations as of December 31, 2013:

	Payments Due by Period
	Total		Less Than One Year		1-3 Years		3-5 Years		More than Five Years
	(in thousands)
Rent obligations(1)	$	3,311	$	640	$	1,285	$	1,279	$	107
Equipment lease obligations(2)	120		30		60		30		—
Total operating lease obligations	3,431		670		1,345		1,309		107
Purchase commitments(3)	15,886		14,048		1,838		—		—
Product formula obligations(4)	1,700		150		300		1,250		—
Warehousing overhead obligations(5)	300		200		100		—		—
Total	$	21,317	$	15,068	$	3,583	$	2,559	$	107

(1) We lease approximately 33,500 square feet of space that houses our corporate headquarters at 1610 Fifth Street, Berkeley, California pursuant to a lease agreement, or Lease, that was originally scheduled to expire in February 2016. In September 2012, we entered into an amendment to the Lease and extended the initial term of the lease for three additional years to February 2019. The rent for the additional three years will be equal to 95% of the then fair market rental rate for the property; however, the monthly rent payable will not be less than the monthly rent payable during the immediately preceding month of the initial term. The landlord is required to deliver to us a notice of the fair market rental rate for the property no later than August 1, 2015. The table above assumes rent for the additional three years at the monthly rental rate applicable to last month’s rate of the original Lease.

(2) We lease equipment under non-cancelable operating leases. These leases expire at various dates through 2019, excluding extensions at our option, and contain provisions for rental adjustments.

(3) We have non-cancelable purchase commitments, directly or through contract manufacturers, to purchase ingredients to be used in the future to manufacture products.

(4) This represents our obligation, to one of our contract manufacturers, for the product formulas purchased in November 2011. Of these amounts, $1.0 million is included in total liabilities in our condensed consolidated balance sheet as of December 31, 2013.

(5) We have an agreement with our contract warehousing company to pay minimum overhead fees through June 2015.

Off-Balance Sheet Arrangements

We do not have any off-balance sheet arrangements or any holdings in variable interest entities.

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ITEM 3 – QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Our Form 10-K for fiscal 2013 provides a detailed discussion of the market risks affecting our operations. We believe our exposure to these market risks did not change materially during the three and nine months ended December 31, 2013.

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ITEM 4 – CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

We have established disclosure controls and procedures that are designed to ensure that the information required to be disclosed by the Company in the reports that it files or submits under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms and that such information is accumulated and communicated to management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.

Our management, including our principal executive officer and principal financial officer evaluated the effectiveness of our disclosure controls and procedures. Based on this review, the principal executive officer and principal financial officer of the Company have concluded that the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934) were effective as of December 31, 2013.

Changes in Internal Control Over Financial Reporting

There was no change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that occurred during the quarterly period ended December 31, 2013 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

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PART II – OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

On December 6, 2013, a private organization called the Center for Environmental Health (“CEH”) sued us and our subsidiary, Annie’s Homegrown, Inc., in Superior Court of the State of California in the County of Alameda under California Health & Safety Code §§ 25249.5 et seq. (commonly referred to as “Proposition 65”). CEH claims that warnings are required in California under Proposition 65 for alleged exposures to lead and lead compounds from cookies that contain ginger or molasses, including our Gluten-Free Ginger Snap Bunny Cookies. CEH is seeking injunctive relief, civil penalties of $2,500 per violation per day and its attorneys’ fees and costs. The lawsuit, entitled Mondelez International, Inc., et al., Alameda County Superior Court Case No. RG13-677800, names nine other companies that are either suppliers or retailers of ginger- or molasses-containing cookies. We cannot at this time reasonably estimate a range of exposure, if any, of the potential liability relating to this suit.

Additionally, from time to time, we are subject to claims, assessments or other legal proceedings in the ordinary course of business, including product liability claims, employee claims, and other general liability claims. While it is not feasible to predict or determine the ultimate outcome of these matters, we believe that none of these legal proceedings, individually or in the aggregate, will have a material adverse effect on our financial position.

ITEM 1A. RISK FACTORS

The following risk factors have been added to address our planned acquisition of a snack manufacturing plant in Joplin, Missouri and are supplemental to the risk factors previously disclosed in our Form 10-K for fiscal 2013 filed with the SEC on June 14, 2013.

Risks Related to the Acquisition of the Joplin Manufacturing Plant

Our business and prospects may be adversely affected by our failure to successfully consummate the recently announced acquisition of the Joplin manufacturing plant.

While we have signed an agreement to purchase the Joplin manufacturing plant from Safeway, there can be no assurance that we will complete the acquisition of the Joplin manufacturing plant under the terms set forth in the agreement, or at all, because the obligation of the parties to consummate the acquisition is subject to conditions as set forth in the agreement, many of which are beyond our control, including (i) receipt of necessary permits; (ii) acceptance by key employees of Safeway of employment by us; (iii) Safeway’s satisfaction that it has fulfilled any collective bargaining obligations that it is required to undertake with the labor organization presently representing employees at the plant; and (iv) satisfaction of other customary closing conditions. There can be no assurance that the conditions to closing will be satisfied.

If consummated, our results may be adversely affected if we fail to integrate the Joplin manufacturing operations successfully.

The acquisition of the Joplin manufacturing plant, if consummated, will pose additional risks, including the inability to integrate the acquired business efficiently into our existing operations, diversion of management’s attention from other business concerns, loss of employees key to the operation of the Joplin plant, potential assumption of unknown liabilities, potential disputes with the seller and potential impairment charges if purchase assumptions are not achieved or market conditions decline. These risks are exacerbated by the fact that we have not previously operated a manufacturing plant. Our business or financial results may be negatively affected if the Joplin acquisition is not successfully integrated.

We may fail to realize the productivity enhancements and other benefits expected from our acquisition of the Joplin manufacturing plant.

The success of the Joplin acquisition will depend, in part, on our ability to control costs, drive incremental volume and successfully integrate the Joplin manufacturing plant into our company. If we are not able to achieve these objectives within the anticipated time frame, or at all, the anticipated benefits of the acquisition may not be realized fully or at all or may take longer to realize than expected and our business may be adversely affected. In addition, efforts to integrate the Joplin manufacturing plant into our company may also divert management attention and resources. Issues that may arise in connection with integrating the Joplin manufacturing plant include, among other things: integration of manufacturing and distribution activities; implementation and management of information systems; conforming the manufacturing plant’s controls, procedures and accounting and other policies to our own; retaining key management and employees; and labor negotiations and collective bargaining. In addition, our ability to realize the benefits expected from our acquisition is dependent on our ability to drive future sales growth in our cookie and cracker business. If the demand for our cookie and cracker products does not increase at the rate we expect over the long term, due to competition or other factors, our results of operations may be adversely affected.

32

We cannot assure you that we will be able to integrate the operations of the Joplin manufacturing plant successfully, control costs, drive incremental volume or operate the Joplin manufacturing plant as profitably as anticipated. Our beliefs regarding the benefits to be derived from the acquisition of the Joplin manufacturing plant are based on numerous assumptions that are subject to risks and uncertainties that could deviate materially from our expectations.

In connection with the acquisition of the Joplin manufacturing plant, we will be expanding our business model to include manufacturing for us and for an affiliate of the seller. We cannot assure you that our expansion into manufacturing and co-packing will succeed.

We have not owned or operated a manufacturing plant in the past and we may encounter increased financial and operational difficulties in integrating the Joplin manufacturing plant with our current operations. In the past, we relied exclusively on contract manufacturers to produce our products and we have not previously manufactured products for others. While we have invested in manufacturing equipment and worked closely with our contract manufacturers on the manufacturing of our products and efficiency initiatives, the operation of a manufacturing plant presents additional challenges and risks for our business. Operating a manufacturing plant requires different operating strategies and different managerial experience than our current operations, and a manufacturing plant is subject to additional and different regulations than our current operations. Our lack of experience in operating manufacturing facilities and co-packing for third parties could result in fewer benefits to us than we anticipate, as well as increased costs. Further, we expect there to be additional costs in connection with the acquisition and integration of the Joplin manufacturing plant into our operations, including costs related to information technology systems, additional personnel needs at both the plant and corporate level, and transitional services provided by Safeway or its affiliates. The operation of the Joplin manufacturing plant may also divert management’s attention from the development of our existing operations and cause our existing business to suffer.

In addition, any interruption in, or the loss of operations at the Joplin manufacturing plant, which may be caused by work stoppages, disease outbreaks or pandemics, acts of war, terrorism, fire, tornadoes, earthquakes, flooding or other natural disasters, could delay or postpone production of our products and the products that we have committed to manufacture for Safeway, which could have a material adverse effect on our business, results of operations and financial condition, especially until such time as such interruption is resolved or an alternate source of production is secured.

33

ITEM 6. EXHIBITS

		Incorporation by Reference
Exhibit Number	Description	Form	File No.	Exhibit(s)	Filing Date
2.1	Agreement of Purchase and Sale by and among Safeway Australia Holdings, Inc., Safeway Inc. and Annie’s, Inc., dated November 5, 2013	Form 10-Q	001-35470	2.1	November 7, 2013
3.1	Second Restated Certificate of Incorporation of Annie’s, Inc., dated September 10, 2013	Form 8-K	001-35470	3.3	September 13, 2013
3.2	Second Amended and Restated Bylaws of Annie’s, Inc., effective September 10, 2013	Form 8-K	001-35470	3.4	September 13, 2013
10.1	Executive Employment Agreement dated October 16, 2013 between Annie’s, Inc. and Zahir Ibrahim+	Form 8-K	001-35470	10.1	October 21, 2013
10.2	Transition and Separation Agreement dated October 16, 2013 between Annie’s, Inc. and Kelly J. Kennedy +	Form 8-K	001-35470	10.2	October 21, 2013
10.3	Amendment No. 2 to the Second Amended and Restated Loan Agreement dated as of November 5, 2013 among Bank of America, N.A., Annie’s, Inc., Annie’s Homegrown, Inc., Annie’s Enterprises, Inc. and Napa Valley Kitchens, Inc.	Form 10-Q	001-35470	10.3	November 7, 2013
10.4*	Joinder Agreement dated as of November 22, 2013 between Bank of America, N.A. and Annie’s, Inc., Annie’s Enterprises, Inc., Annie’s Homegrown, Inc. and Annie’s Baking, LLC
31.1*	Certification of Principal Executive Officer Required Under Rule 13a-14(a) and 15d-14(a) of the Securities Exchange Act of 1934, as amended
31.2*	Certification of Principal Financial Officer Required Under Rule 13a-14(a) and 15d-14(a) of the Securities Exchange Act of 1934, as amended
32.1*	Certification of Principal Executive Officer and Principal Financial Officer Required Under Rule 13a-14(b) of the Securities Exchange Act of 1934, as amended, and 18 U.S.C. §1350
101*	The following materials from Company’s Quarterly Report on Form 10-Q for the three months ended December 31, 2013, formatted in Extensible Business Reporting Language (XBRL) includes: (i) Condensed Consolidated Balance Sheets as of December 31, 2013 and March 31, 2013, (ii) Condensed Consolidated Statements of Operations for the three and nine months ended December 31, 2013 and 2012, (iii) Condensed Consolidated Statement of Stockholders’ Equity for the nine months ended December 31, 2013, (iv) Condensed Consolidated Statements of Cash Flows for the nine months ended December 31, 2013 and 2012 and (v) Notes to Condensed Consolidated Financial Statements.

+    Indicates a management contract or compensatory plan or arrangement.

*    Furnished or filed herewith, as applicable

34

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Date: February 10, 2014

ANNIE’S, INC.
By:	/s/ Zahir M. Ibrahim
	Zahir M. Ibrahim
	Executive Vice President, Chief Financial Officer and Treasurer
	(Principal Financial and Accounting
	Officer and Duly Authorized Officer)

35

EX-10.4

JOINDER AGREEMENT

This Joinder Agreement (this "Agreement"), dated as of November 22, 2013, is between Bank of America, N.A. (the "Bank") and ANNIE'S, INC., a Delaware corporation, formerly known as Homegrown Naturals, Inc., which is qualified to do business in the State of California as Homegrown Naturals, ANNIE'S ENTERPRISES, INC., a Vermont corporation, which is qualified to do business in the State of California as Annie's Naturals, ANNIE'S HOMEGROWN, INC., a Delaware corporation, and NAPA VALLEY KITCHENS, a California corporation (the "Existing Borrowers"), and Annie’s Baking, LLC, a Delaware limited liability company (the "Additional Borrower" and together with the Existing Borrowers, individually and collectively, the "Borrower").

RECITALS

A. The Additional Borrower desires to become (i) a "Borrower" pursuant to the terms of that certain Second Amended and Restated Loan Agreement, dated as of December 21, 2011, as amended by that certain Amendment No. 1 dated as of March 7, 2013, and by that certain Amendment No. 2 dated as of November 5, 2013, by and between the Bank and the Existing Borrowers (collectively, the "Loan Agreement"); and a "Pledgor" pursuant to the terms of that certain Amended and Restated Security Agreement, dated as of August 25, 2010, by and between the Bank and the Existing Borrowers (the "Security Agreement").

B. The Bank is willing to allow the Additional Borrower to become a "Borrower" pursuant to the terms of the Loan Agreement and a "Pledgor" pursuant to the terms of the Security Agreement.

AGREEMENT

1.Definitions. Capitalized terms used but not defined in this Amendment shall have the meaning given to them in the Loan Agreement.

2.Joinder.

2.1.The Additional Borrower hereby acknowledges, agrees and confirms that, by its execution of this Agreement, effective the date hereof, the Additional Borrower will be deemed to be a party to the Loan Agreement and a "Borrower" for all purposes of the Loan Agreement, and will be deemed to be a party to the Security Agreement and a "Pledgor" for all purposes of the Security Agreement, and shall have all of the rights and obligations of a Borrower and a Pledgor thereunder as fully as if it had executed the Loan Agreement and the Security Agreement as a Borrower or a Pledgor. The Additional Borrower hereby ratifies, as of the date hereof, and agrees to be bound by, all of the terms, provisions and conditions contained in the Loan Agreement and the Security Agreement which are binding upon the Borrower and Pledgor, as may be supplemented from time to time in accordance with the terms thereof.

2.2.The Bank confirms that immediately upon execution of this Agreement by the parties hereto, the Additional Borrower shall become a Borrower and a Pledgor under the Loan Agreement and Security Agreement respectively.

2.3.The Additional Borrower agrees that, at any time and from time to time, upon the written request of the Bank, it will execute and deliver such further documents and do such further acts and things as the Bank may reasonably request in order to effect the purposes of this Agreement.

2.4.The Additional Borrower represents and warrants to the Bank that: (a) there is no event which is, or with notice or lapse of time or both would be, a default under the Loan Agreement except those events, if any, that have been disclosed in writing to the Bank or waived in writing by the Bank, (b) the representations and warranties in the Loan Agreement are true as of the date of this Agreement as if made on the date of this Agreement, (c) this Agreement does not conflict with any law, agreement, or obligation by which the Additional Borrower is bound, except to the extent where any such conflict would not have a material adverse effect on the Additional Borrower’s business condition (financial or otherwise), operations, properties or prospects, or ability to repay the credit, and (d) if the Additional Borrower is a business entity or a trust, this Agreement is within the Additional Borrower's powers, has been duly authorized, and does not conflict with any of the Additional Borrower's organizational papers.

3.Conditions. This Agreement will be effective when the Bank receives the following items, in form and content acceptable to the Bank:

3.1.If the Additional Borrower or any guarantor is anything other than a natural person, evidence that the execution, delivery and performance by the Additional Borrower and/or such guarantor of this Agreement and any instrument or agreement required under this Agreement have been duly authorized.

3.2.Payment by the Additional Borrower of all costs, expenses and attorneys' fees (including allocated costs for in-house legal services) incurred by the Bank in connection with this Agreement.

4.Counterparts. This Agreement may be executed in counterparts, each of which when so executed shall be deemed an original, but all such counterparts together shall constitute but one and the same instrument.

5.FINAL AGREEMENT.BY SIGNING THIS DOCUMENT EACH PARTY REPRESENTS AND AGREES THAT: (A) THIS DOCUMENT REPRESENTS THE FINAL AGREEMENT BETWEEN PARTIES WITH RESPECT TO THE SUBJECT MATTER HEREOF, (B) THIS DOCUMENT SUPERSEDES ANY COMMITMENT LETTER, TERM SHEET OR OTHER WRITTEN OUTLINE OF TERMS AND CONDITIONS RELATING TO THE SUBJECT MATTER HEREOF, UNLESS SUCH COMMITMENT LETTER, TERM SHEET OR OTHER WRITTEN OUTLINE OF TERMS AND CONDITIONS EXPRESSLY PROVIDES TO THE CONTRARY, (C) THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES, AND (D) THIS DOCUMENT MAY NOT BE CONTRADICTED BY EVIDENCE OF ANY PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OR UNDERSTANDINGS OF THE PARTIES.

[SIGNATURE PAGE FOLLOWS]

2

This Agreement is executed as of the date stated at the beginning of this Agreement.

	BANK: BANK OF AMERICA, N.A. By: /s/ David M. Meddaugh Name: David M. Meddaugh Title: Senior Vice President Address where notices to the Bank are to be sent: Farmington-Notice Desk CT2-515-BB-03 70 Batterson Park Road Farmington, CT 06032 Telephone: (866) 409-5450 Facsimile: (866) 255-7972 ADDITIONAL BORROWER:
Address where notices to the Borrower are to be sent: Annie’s Baking, LLC c/o ANNIE’S, INC. 1610 Fifth Street Berkeley, CA 94710 Phone: 510-558-7500 Fax: 510-558-6072	Annie’s Baking, LLC,  a Delaware limited liability company, By: /s/ John M. Foraker Name: John M. Foraker Title: Chief Executive Officer EXISTING BORROWERS:
Address where notices to the Borrower are to be sent: ANNIE’S, INC. 1610 Fifth Street Berkeley, CA 94710 Phone: 510-558-7500 Fax: 510-558-6072	ANNIE'S, INC.,  a Delaware corporation By: /s/ John M. Foraker Name: John M. Foraker Title: Chief Executive Officer
[SIGNATURES CONTINUE ON FOLLOWING PAGE]

S-1

Address where notices to the Borrower are to be sent: ANNIE'S ENTERPRISES, INC., c/o ANNIE’S, INC. 1610 Fifth Street Berkeley, CA 94710 Phone: 510-558-7500 Fax: 510-558-6072	ANNIE'S ENTERPRISES, INC.,  a Vermont corporation By: /s/ John M. Foraker Name: John M. Foraker Title: Chief Executive Officer
Address where notices to the Borrower are to be sent: ANNIE'S HOMEGROWN, INC. c/o ANNIE’S, INC. 1610 Fifth Street Berkeley, CA 94710 Phone: 510-558-7500 Fax: 510-558-6072	ANNIE'S HOMEGROWN, INC.,  a Delaware corporation By: /s/ John M. Foraker Name: John M. Foraker Title: Chief Executive Officer

Address where notices to the Borrower are to be sent: NAPA VALLEY KITCHENS c/o ANNIE’S, INC. 1610 Fifth Street Berkeley, CA 94710 Phone: 510-558-7500 Fax: 510-558-6072 NAPA VALLEY KITCHENS,  a California corporation By: /s/ John M. Foraker Name: John M. Foraker Title: Chief Executive Officer

S-2

EX-31.1

Exhibit 31.1

CERTIFICATION

I, John M. Foraker, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Annie’s, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: February 10, 2014

/s/ John M. Foraker

John M. Foraker

Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION

I, Zahir M. Ibrahim, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Annie’s, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: February 10, 2014

/s/ Zahir M. Ibrahim

Zahir M. Ibrahim

Executive Vice President, Chief Financial Officer and Treasurer

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of Annie’s, Inc. (the “Company”) for the fiscal quarter ended December 31, 2013, as filed with the Securities and Exchange Commission (the “Report”), John M. Foraker, Chief Executive Officer of the Company, and Zahir M. Ibrahim, Executive Vice President, Chief Financial Officer and Treasurer of the Company, respectively, do each hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of his or her knowledge:

• The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

• The information in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: February 10, 2014

/s/ John M. Foraker

John M. Foraker

Chief Executive Officer

/s/ Zahir M. Ibrahim

Zahir M. Ibrahim

Executive Vice President, Chief Financial Officer and Treasurer

XML

Credit Facility - Additional Information (Detail) (USD $) In Millions, unless otherwise specified	1 Months Ended	3 Months Ended		9 Months Ended		12 Months Ended
	Dec. 31, 2011	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2013	Dec. 31, 2012	Mar. 31, 2013
Line of Credit Facility [Line Items]
Loans and letter of credit, maximum borrowing capacity	$ 20.0					$ 40.0
Line of credit facility, expiration date	August 2014					August 2016
Weighted average interest rate		1.40%	1.50%		1.40%
Line of credit facility, available borrowing capacity		40.0		40.0		33.0
Borrowing capacity for revolving loans with Bank of America		15.0		15.0
Funded Debt to Adjusted EBITDA				275.00%
Minimum net worth		$ 50.0		$ 50.0
Percentage of earnings after taxes		30.00%		30.00%
Minimum
Line of Credit Facility [Line Items]
Line of credit facility, unused line fee		0.25%
Maximum
Line of Credit Facility [Line Items]
Line of credit facility, unused line fee		0.40%
Rate Option One
Line of Credit Facility [Line Items]
Line of credit, interest rate		1.25%
Rate Option Two
Line of Credit Facility [Line Items]
Line of credit, interest rate		1.25%

XML

Product Recall - Additional Information (Detail) (USD $) In Millions, unless otherwise specified	3 Months Ended	9 Months Ended
	Dec. 31, 2013	Dec. 31, 2013
Product Recall Disclosure [Abstract]
Amount recovered from the submitted claim	$ 0.4	$ 1.6

XML

Stock-Based Compensation - Additional Information (Detail) (USD $)	9 Months Ended		3 Months Ended		9 Months Ended				3 Months Ended
	Dec. 31, 2013	Mar. 31, 2013	Dec. 31, 2013 Selling, General and Administrative Expenses	Dec. 31, 2012 Selling, General and Administrative Expenses	Dec. 31, 2013 Selling, General and Administrative Expenses	Dec. 31, 2012 Selling, General and Administrative Expenses	Dec. 31, 2013 Performance Shares	Dec. 31, 2013 Maximum Performance Shares	Dec. 31, 2013 2004 Stock Option Plan	Dec. 31, 2013 2004 Stock Option Plan Maximum	Dec. 31, 2013 2004 Stock Option Plan Second Anniversary	Dec. 31, 2013 2004 Stock Option Plan Third Anniversary
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting period (in years)							3 years			5 years
Stock options, expiration period (in years)									10 years
Percentage of restricted stock units granted to employees vested											50.00%	50.00%
Stock-based compensation expense			$ 251,000	$ 230,000	$ 660,000	$ 677,000
Stock-based compensation expense, weighted average grant date fair value of the employee stock options	$ 15.76
Stock-based compensation expense, related to stock options granted to the employees	4,100,000
Unvested shares outstanding	101,357	71,165					70,872	106,313
Estimated number of shares to be issued							35,441
Unrecognized compensation cost related to unvested share-based compensation	$ 4,000,000
Unrecognized compensation cost, expected to be recognized over a weighted average period	3 years

XML

Product Recall - Impact of the Recall-Related Charges and Related Insurance Recoveries (Detail) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended		9 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2013	Dec. 31, 2012
Product Recall Disclosure [Abstract]
Benefit to net sales	$ 104	$ (1,570)	$ 855	$ (1,570)
Benefit to cost of sales	280	(690)	533	(690)
Benefit to/(incremental) selling, general and administrative expenses	(7)	0	(18)	0
Total benefit to income before income taxes	377	(2,260)	1,370	(2,260)
Benefit to net income	$ 224	$ (1,346)	$ 827	$ (1,346)
Benefit to net income per diluted share	$ 0.01	$ (0.08)	$ 0.05	$ (0.08)

XML

Stock-Based Compensation - Activity of Stock Options (Detail) (USD $)	9 Months Ended
	Dec. 31, 2013
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward]
Beginning balance, shares	1,203,990
Granted, shares	62,387
Forfeited, shares	(99,066)
Exercised, shares	(123,364)
Ending balance, shares	1,043,947
Beginning balance, weighted average exercise price	$ 13.26
Granted, Weighted-Average Exercise Price	$ 41.87
Forfeited, Weighted-Average Exercise Price	$ 18.28
Exercised, Weighted-Average Exercise Price	$ 9.81
Ending Balance, Weighted-Average Exercise Price	$ 14.90

XML

Initial Public Offering (IPO) (Details) (USD $) In Millions, except Share data, unless otherwise specified	9 Months Ended
	Dec. 31, 2013
Class of Stock [Line Items]
Outstanding shares of convertible preferred stock converted into number of shares of common stock	15,221,571
Reclassified common stock and the related convertible preferred stock warrant liability to additional paid-in capital	80,560
IPO
Class of Stock [Line Items]
Sale of stock, transaction date	Apr. 02, 2012
Number of shares sold by the Company	950,000
Common stock, offering price	$ 19.00
Net proceeds from IPO	$ 11.1
Underwriting discounts and commissions	1.3
Offering expenses	$ 5.6
Number of shares sold to shareholders	4,800,000

XML

Commitments and Contingencies (Tables)

9 Months Ended

Dec. 31, 2013

Commitments and Contingencies Disclosure [Abstract]

Future Minimum Lease Payments under Non-cancelable Operating Leases

Future minimum lease payments under the non-cancelable operating leases as of December 31, 2013 are as follows (in thousands):

	Lease Payments
Three Months Ending March 31, 2014	$	166
Fiscal Year Ending March 31:
2015	675
2016	673
2017	669
2018	662
2019	586
Total future minimum lease payments	$	3,431

XML

Earnings per share - Outstanding Shares of Potentially Dilutive Securities Excluded from Computation of Diluted Net Income Per Share of Common Stock (Detail)	3 Months Ended		9 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2013	Dec. 31, 2012
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Potentially dilutive securities excluded from the computation of diluted net income per share of common stock	110,298	2,562	115,732	8,818
Stock Options
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Potentially dilutive securities excluded from the computation of diluted net income per share of common stock	105,157	2,562	105,157	2,562
Restricted Stock Units
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Potentially dilutive securities excluded from the computation of diluted net income per share of common stock	5,141	0	10,575	6,256

XML

Commitments and Contingencies - Additional Information (Detail) (USD $)	3 Months Ended		9 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2013 Other_Defendants	Dec. 31, 2012
Contingencies And Commitments [Line Items]
Rent expense	$ 155,000	$ 146,000	$ 461,000	$ 386,000
Purchase commitments	15,900,000		15,900,000
Product formula purchase price	2,000,000		2,000,000
Annual payment for product formula purchases			150,000
Product formula purchase agreement period			7 years
Product formula purchase agreement period end date			2018-11
Amount the plaintiff may seek per violation per day	2,500		2,500
Number of Other Companies Named As Defendants			9
Overhead fees
Contingencies And Commitments [Line Items]
Remaining obligation			300,000
Product formulas
Contingencies And Commitments [Line Items]
Remaining obligation			1,700,000
Minimum
Contingencies And Commitments [Line Items]
Annual overhead fees			$ 200,000

XML

Balance Sheet Components - Components of Accrued Liabilities (Detail) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2013	Mar. 31, 2013
Accrued Liabilities [Abstract]
Payroll and employee-related expenses	$ 2,903	$ 3,779
Accrued trade expenses	2,394	2,299
Inventory received not invoiced	2,720	4,038
Deferred rent	249	260
Brokerage commissions	320	407
Other accrued liabilities	518	1,238
Total accrued liabilities	$ 9,104	$ 12,021

XML

Geographic Areas and Product Sales - Net Sales by Geographic Area (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2013	Dec. 31, 2012
Revenues from External Customers and Long-Lived Assets [Line Items]
Net sales	$ 46,177	$ 36,283	$ 143,867	$ 117,262
UNITED STATES
Revenues from External Customers and Long-Lived Assets [Line Items]
Net sales	44,459	34,413	138,130	111,984
CANADA
Revenues from External Customers and Long-Lived Assets [Line Items]
Net sales	$ 1,718	$ 1,870	$ 5,737	$ 5,278

XML

Stock-Based Compensation - Activity of Unvested Restricted Stock Units and Performance Share Units (Detail) (USD $)	9 Months Ended
	Dec. 31, 2013
Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Outstanding [Roll Forward]
Beginning balance, unvested shares	71,165
Granted, shares	54,806
Vested, shares	(4,692)
Forfeited, shares	(19,922)
Ending balance, unvested shares	101,357
Beginning balance, weighted-average grant date fair value of unvested shares	$ 21.73
Granted, weighted-average grant date fair value	$ 41.11
Vested, weighted-average grant date fair value	$ 45.27
Forfeited, weighted-average grant date fair value	$ 24.94
Ending balance, weighted-average grant date fair value of unvested shares	$ 30.49

XML

Balance Sheet Components

9 Months Ended

Dec. 31, 2013

Supplemental Balance Sheet Disclosures [Abstract]

Balance Sheet Components

Balance Sheet Components

Inventory

Inventory is comprised of the following (in thousands):

	December 31, 2013		March 31, 2013
Raw materials	$	2,659	$	1,391
Work in process	1,494		2,142
Finished goods	19,254		11,614
Inventory	$	23,407	$	15,147

The increase in inventory levels as of December 31, 2013 reflects the buildup in advance of the fourth quarter, which historically has been the Company's peak sales season.

Property and Equipment, Net

Property and equipment, net are comprised of the following (in thousands):

	December 31, 2013			March 31, 2013
Equipment and automotive	$	3,897		$	2,959
Software	2,570			2,410
Leasehold improvements	1,342			1,195
Plates and dies	333			244
Total property and equipment	8,142			6,808
Less: Accumulated depreciation and amortization	(2,745		)	(1,760		)
Construction in progress	809			1,090
Property and equipment, net	$	6,206		$	6,138

The Company incurred depreciation expense of $383,000 and $990,000 for the three and nine months ended December 31, 2013, respectively. The depreciation expense for the same periods in the prior year was $271,000 and $704,000, respectively.

Intangible Assets, Net

Intangible assets, net are comprised of the following (in thousands):

	December 31, 2013							March 31, 2013
	Gross					Net		Gross					Net
	Carrying		Accumulated			Carrying		Carrying		Accumulated			Carrying		Useful
	Amount		Amortization			Amount		Amount		Amortization			Amount		Lives
Product formulas	$	1,023	$	(106	)	$	917	$	1,023	$	(68	)	$	955	5 - 25 years
Other intangible assets	189		(35		)	154		189		(28		)	161		5 - 25 years
Total	$	1,212	$	(141	)	$	1,071	$	1,212	$	(96	)	$	1,116

The Company incurred amortization expense of $15,000 and $45,000 on its intangible assets during the three and nine months ended December 31, 2013. The amortization expense for the same periods over the prior year was $15,000 and $45,000, respectively.

The estimated future amortization expense relating to intangible assets for the remainder of fiscal 2014, for each of the next five years through fiscal 2019 and thereafter is $15,000, $60,000 and $756,000, respectively.

Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets as of December 31, 2013 and March 31, 2013 include receivables from contract manufacturers and suppliers of $4.2 million and $3.9 million, respectively.

Accrued Liabilities

The following table shows the components of accrued liabilities (in thousands):

	December 31, 2013		March 31, 2013
Payroll and employee-related expenses	$	2,903	$	3,779
Accrued trade expenses	2,394		2,299
Inventory received not invoiced	2,720		4,038
Deferred rent	249		260
Brokerage commissions	320		407
Other accrued liabilities	518		1,238
Total accrued liabilities	$	9,104	$	12,021

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Convertible Preferred Stock Warrant - Additional Information (Detail) (USD $) In Thousands, except Share data, unless otherwise specified	1 Months Ended	12 Months Ended			1 Months Ended
	Apr. 12, 2012 Hercules	Mar. 31, 2008 Series A Convertible Preferred Stock	Apr. 12, 2012 Common Stock	Apr. 02, 2012 Common Stock	Apr. 02, 2013 Convertible Preferred Stock Other Income and Expense
Convertible Preferred Stock Warrants [Line Items]
Conversion of warrants		80,560	80,560	80,560
Conversion of warrants exercise price		$ 8.07
Warrants expiry date		Apr. 01, 2018
Increase in fair value of convertible preferred stock warrant					$ 13
Shares surrendered	17,367
Common stock shares issued	63,193

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Product Recall (Tables)

9 Months Ended

Dec. 31, 2013

Product Recall Disclosure [Abstract]

Impact of the Recall-Related Charges and Related Insurance Recoveries

The impact of the recall-related charges and related insurance recoveries in the three and nine months ended December 31, 2013 and 2012 is as follows (in thousands except per share amount):

	Three Months Ended December 31,						Nine Months Ended December 31,
	2013			2012			2013			2012
Benefit to/(reduction of) net sales	$	104		$	(1,570	)	$	855		$	(1,570	)
Benefit to/(incremental) cost of sales	280			(690		)	533			(690		)
Benefit to/(incremental) selling, general and administrative expenses	(7		)	—			(18		)	—
Total benefit to/(reduction of) income before income taxes	$	377		$	(2,260	)	$	1,370		$	(2,260	)
Benefit to/(reduction of) net income	$	224		$	(1,346	)	$	827		$	(1,346	)
Benefit to/(reduction of) net income per diluted share	$	0.01		$	(0.08	)	$	0.05		$	(0.08	)

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Geographic Areas and Product Sales (Tables)

9 Months Ended

Dec. 31, 2013

Segment Reporting [Abstract]

Net Sales by Geographic Area

The Company’s net sales by geographic area, based on the location to which the product was shipped, are summarized as follows (in thousands):

	Three Months Ended December 31,				Nine Months Ended December 31,
	2013		2012		2013		2012
United States	$	44,459	$	34,413	$	138,130	$	111,984
Canada	1,718		1,870		5,737		5,278
	$	46,177	$	36,283	$	143,867	$	117,262

Net Sales by Product

The following table sets forth net sales by product category (in thousands):

	Three Months Ended December 31,				Nine Months Ended December 31,
	2013		2012		2013		2012
Meals	$	23,933	$	16,223	$	70,226	$	52,759
Snacks	17,075		14,908		54,953		47,517
Dressings, condiments and other	5,169		5,152		18,688		16,986
	$	46,177	$	36,283	$	143,867	$	117,262

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Planned Acquisition (Detail) (USD $)			1 Months Ended
	Dec. 31, 2013	Mar. 31, 2013	Nov. 05, 2013 Joplin Plant	Dec. 31, 2013 Joplin Plant
Business Acquisition [Line Items]
Business acquisition, cash paid			$ 6,000,000
Business acquisition, inventory value			4,000,000
Number of years the plant produced as primary manufacturer			10 years
Production supply accounted by the plant currently			50.00%
Supply agreement with affiliate			3 years
Restricted cash	$ 300,000	$ 0		$ 300,000

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Preferred Stock - Additional Information (Detail) (USD $)	Dec. 31, 2013	Mar. 31, 2013
Equity [Abstract]
Preferred stock, shares authorized	5,000,000	5,000,000
Preferred stock par value	$ 0.001	$ 0.001

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Description of Business - Additional Information (Detail)	9 Months Ended
	Dec. 31, 2013 Product
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Number of products offered	135
Incorporation date	Apr. 28, 2004

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Summary of Significant Accounting Policies - Concentration risk (Detail)	9 Months Ended	12 Months Ended	3 Months Ended		9 Months Ended		3 Months Ended		9 Months Ended		3 Months Ended		9 Months Ended		12 Months Ended	9 Months Ended	12 Months Ended		9 Months Ended
	Dec. 31, 2013 Customer	Mar. 31, 2013 Customer	Dec. 31, 2013 Customer A Sales Revenue, Goods, Net Customer Concentration Risk [Member]	Dec. 31, 2012 Customer A Sales Revenue, Goods, Net Customer Concentration Risk [Member]	Dec. 31, 2013 Customer A Sales Revenue, Goods, Net Customer Concentration Risk [Member]	Dec. 31, 2012 Customer A Sales Revenue, Goods, Net Customer Concentration Risk [Member]	Dec. 31, 2013 Customer B Sales Revenue, Goods, Net Customer Concentration Risk [Member]	Dec. 31, 2012 Customer B Sales Revenue, Goods, Net Customer Concentration Risk [Member]	Dec. 31, 2013 Customer B Sales Revenue, Goods, Net Customer Concentration Risk [Member]	Dec. 31, 2012 Customer B Sales Revenue, Goods, Net Customer Concentration Risk [Member]	Dec. 31, 2013 Customer C Sales Revenue, Goods, Net Customer Concentration Risk [Member]	Dec. 31, 2012 Customer C Sales Revenue, Goods, Net Customer Concentration Risk [Member]	Dec. 31, 2013 Customer C Sales Revenue, Goods, Net Customer Concentration Risk [Member]	Dec. 31, 2012 Customer C Sales Revenue, Goods, Net Customer Concentration Risk [Member]	Mar. 31, 2013 Customer C Accounts Receivable [Member] Credit Concentration Risk [Member]	Dec. 31, 2013 Major Customer Two Accounts Receivable [Member] Credit Concentration Risk [Member]	Mar. 31, 2013 Major Customer Two Accounts Receivable [Member] Credit Concentration Risk [Member]	Mar. 31, 2013 Major Customer One Accounts Receivable [Member] Credit Concentration Risk [Member]	Dec. 31, 2013 Major Customer Accounts Receivable [Member] Credit Concentration Risk [Member]
Concentration Risk [Line Items]
Number Of Major Customer	2	3
Concentration risk, percentage			22.00%	25.00%	21.00%	26.00%	18.00%	17.00%	15.00%	13.00%	11.00%	11.00%	13.00%	12.00%	10.00%	18.00%	26.00%	36.00%	31.00%

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Initial Public Offering (IPO) (Notes)

9 Months Ended

Dec. 31, 2013

Initial Public Offering Disclosures [Abstract]

Initial Public Offering (IPO)

Initial Public Offering (IPO)

On April 2, 2012, the Company closed its IPO, in which it sold 950,000 shares at an offering price of $19.00 per share and raised $11.1 million in net proceeds after deducting underwriting discounts and commissions of $1.3 million and other offering expenses of $5.6 million. In addition, certain of the Company’s stockholders, including funds affiliated with Solera Capital, LLC, sold 4.8 million shares at the $19.00 offering price in the IPO. The Company sometimes refers to Solera Capital, LLC and its affiliates as Solera in this Quarterly Report on Form 10-Q.

Immediately prior to the closing of the IPO, the outstanding shares of convertible preferred stock were automatically converted into 15,221,571 shares of common stock, the Company’s outstanding convertible preferred stock warrant was automatically converted into a common stock warrant to purchase a total of 80,560 shares of common stock and the related convertible preferred stock warrant liability was reclassified to additional paid-in capital.

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Summary of Significant Accounting Policies - Additional Information (Detail) (USD $)	3 Months Ended		9 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2013	Dec. 31, 2012	Mar. 31, 2013
Property, Plant and Equipment [Line Items]
Allowance for doubtful accounts	$ 21,000		$ 21,000		$ 0
Capitalized software development costs, net of accumulated amortization	2,300,000		2,300,000		2,100,000
Construction in progress	600,000		600,000		400,000
Shipping and handling costs	1,800,000	1,400,000	5,200,000	4,200,000
Research and development cost	500,000	600,000	1,700,000	2,100,000
Advertising costs	$ 400,000	$ 200,000	$ 1,200,000	$ 600,000
Equipment and automotive | Minimum
Property, Plant and Equipment [Line Items]
Useful life of property and equipment			3 years
Equipment and automotive | Maximum
Property, Plant and Equipment [Line Items]
Useful life of property and equipment			7 years
Software | Minimum
Property, Plant and Equipment [Line Items]
Useful life of property and equipment			3 years
Software | Maximum
Property, Plant and Equipment [Line Items]
Useful life of property and equipment			7 years
Plates and dies
Property, Plant and Equipment [Line Items]
Useful life of property and equipment			3 years

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Related Party Transactions - Additional Information (Detail) (USD $) In Millions, except Share data, unless otherwise specified	0 Months Ended		9 Months Ended	1 Months Ended
	Nov. 18, 2013 Secondary Public Offering	Aug. 06, 2012 Secondary Public Offering	Dec. 31, 2013 Secondary Public Offering	Apr. 30, 2012 Solera Partners, L.P
Related Party Transaction [Line Items]
Contract termination, fee				$ 1.3
Sale of stock, transaction date		Aug. 06, 2012
Number of shares sold to shareholders	2,537,096	3,649,976
Common stock price	$ 47.95	$ 39.25
Offering expenses		$ 0.7	$ 0.3

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Geographic Areas and Product Sales - Net Sales by Product (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2013	Dec. 31, 2012
Revenue from External Customer [Line Items]
Net sales	$ 46,177	$ 36,283	$ 143,867	$ 117,262
Meals
Revenue from External Customer [Line Items]
Net sales	23,933	16,223	70,226	52,759
Snacks
Revenue from External Customer [Line Items]
Net sales	17,075	14,908	54,953	47,517
Dressings, Condiments and Other
Revenue from External Customer [Line Items]
Net sales	$ 5,169	$ 5,152	$ 18,688	$ 16,986

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Condensed Consolidated Balance Sheets (USD $) In Thousands, unless otherwise specified	Dec. 31, 2013	Mar. 31, 2013
CURRENT ASSETS:
Cash	$ 2,986	$ 4,930
Accounts receivable, net of allowance	18,796	20,015
Inventory	23,407	15,147
Deferred tax assets	2,565	2,558
Income tax receivable	988	588
Prepaid expenses and other current assets	5,572	5,050
Total current assets	54,314	48,288
Restricted cash	300	0
Property and equipment, net	6,206	6,138
Goodwill	30,809	30,809
Intangible assets, net	1,071	1,116
Deferred tax assets, long-term	3,553	3,704
Other non-current assets	142	157
Total assets	96,395	90,212
CURRENT LIABILITIES:
Accounts payable	6,784	4,342
Accrued liabilities	9,104	12,021
Total current liabilities	15,888	16,363
Credit facility	0	7,007
Other non-current liabilities	870	913
Total liabilities	16,758	24,283
Commitments and contingencies (Note 7)
STOCKHOLDERS' EQUITY
Common stock	17	17
Additional paid-in capital	96,528	93,190
Accumulated deficit	(16,908)	(27,278)
Total stockholders' equity	79,637	65,929
Total liabilities and stockholders' equity	$ 96,395	$ 90,212

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Common Stock - Additional Information (Detail) (USD $)	9 Months Ended
	Dec. 31, 2013 Vote	Dec. 31, 2012	Mar. 31, 2013
Equity [Abstract]
Common stock, authorized	30,000,000		30,000,000
Common stock, par value	$ 0.001		$ 0.001
Common stock, issued	16,972,380		16,849,016
Common stock, outstanding	16,972,380		16,849,016
Common stock, right per share	1
Common stock dividends declared and paid	$ 0	$ 0

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Description of Business

9 Months Ended

Dec. 31, 2013

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Description of Business

Description of Business

Annie’s, Inc. (the “Company”), a Delaware corporation incorporated on April 28, 2004, is a natural and organic food company. The Company offers over 135 products in the following three product categories: meals; snacks; and dressings, condiments and other. The Company’s products are sold throughout the U.S. and Canada via a multi-channel distribution network that serves the mainstream grocery, mass merchandiser and natural retailer channels. The Company’s headquarters are located in Berkeley, California.

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Balance Sheet Components - Property and Equipment, Net (Detail) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2013	Mar. 31, 2013
Property, Plant and Equipment [Line Items]
Total property and equipment	$ 8,142	$ 6,808
Less: Accumulated depreciation and amortization	(2,745)	(1,760)
Construction in progress	809	1,090
Property and equipment, net	6,206	6,138
Equipment and automotive
Property, Plant and Equipment [Line Items]
Total property and equipment	3,897	2,959
Software
Property, Plant and Equipment [Line Items]
Total property and equipment	2,570	2,410
Leasehold improvements
Property, Plant and Equipment [Line Items]
Total property and equipment	1,342	1,195
Plates and dies
Property, Plant and Equipment [Line Items]
Total property and equipment	$ 333	$ 244

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Summary of Significant Accounting Policies (Policies)

9 Months Ended

Dec. 31, 2013

Accounting Policies [Abstract]

Basis of Presentation and Consolidation

Basis of Presentation and Consolidation

The accompanying interim condensed consolidated statements of operations for the three and nine months ended December 31, 2013 and 2012, the interim condensed consolidated balance sheets as of December 31, 2013 and March 31, 2013, the interim condensed consolidated statement of stockholders’ equity for the nine months ended December 31, 2013, and the interim condensed consolidated statements of cash flows for the nine months ended December 31, 2013 and 2012 are unaudited. These unaudited interim condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and the applicable rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial information. Accordingly, they do not include all of the information and notes required by U.S. GAAP for complete financial statements. These unaudited interim condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto contained in Company’s Annual Report on Form 10-K filed with the SEC on June 14, 2013. The March 31, 2013 condensed consolidated balance sheet included herein was derived from the audited financial statements as of that date, but does not include all disclosures including notes required by U.S. GAAP for complete financial statements.

The unaudited interim condensed consolidated financial statements have been prepared on the same basis as the audited consolidated financial statements and, in the opinion of management, reflect all adjustments of a normal recurring nature considered necessary to state fairly the Company's financial position as of December 31, 2013 and results of its operations for the three and nine months ended December 31, 2013 and 2012, and the cash flows for the nine months ended December 31, 2013 and 2012. The interim results for the nine months ended December 31, 2013 are not necessarily indicative of the results that may be expected for the year ending March 31, 2014.

The unaudited interim condensed consolidated financial statements include the accounts of the Company and its wholly owned direct and indirect subsidiaries, Annie’s Homegrown, Inc., Annie’s Enterprises, Inc., Napa Valley Kitchen, Inc. and Annie's Baking, LLC. All significant intercompany balances and transactions have been eliminated in consolidation. Certain reclassifications were made to the Company's prior financial statements to conform to the current year presentation.

Use of Estimates

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of sales and expenses during the reported periods. Actual results could differ from those estimates.

Accounts Receivable

The Company manages credit risk through credit approvals, credit limits and monitoring procedures. The Company performs periodic credit evaluations of its customers and records an allowance for uncollectible accounts receivable based on a specific identification methodology. In addition, management may record an additional allowance based on the Company’s experience with accounts receivable aging categories. Accounts receivable are recorded net of allowances for trade discounts and doubtful accounts. The Company had $21,000 for allowance for doubtful accounts as of December 31, 2013. The Company had no allowance for doubtful accounts as of March 31, 2013.

Concentration Risk

Accounts Receivable and Concentration Risk

The Company manages credit risk through credit approvals, credit limits and monitoring procedures. The Company performs periodic credit evaluations of its customers and records an allowance for uncollectible accounts receivable based on a specific identification methodology. In addition, management may record an additional allowance based on the Company’s experience with accounts receivable aging categories. Accounts receivable are recorded net of allowances for trade discounts and doubtful accounts. The Company had $21,000 for allowance for doubtful accounts as of December 31, 2013. The Company had no allowance for doubtful accounts as of March 31, 2013.

Customers with 10% or more of the Company’s net sales consist of the following:

	Net Sales
	Customer A		Customer B		Customer C
Three Months Ended December 31,
2013	22	%	18	%	11	%
2012	25	%	17	%	11	%
Nine Months Ended December 31,
2013	21	%	15	%	13	%
2012	26	%	13	%	12	%

As of December 31, 2013, two customers represented 31% and 18%, respectively, of accounts receivable. As of March 31, 2013, three customers represented 36%, 26%, and 10%, respectively, of accounts receivable.

Fair Value of Financial Instruments

Fair Value of Financial Instruments

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the reporting date. The accounting guidance establishes a three-tiered hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value:

Level 1—Quoted prices in active markets for identical assets or liabilities.

Level 2—Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

The categorization of a financial instrument within the valuation hierarchy is based on the lowest level of input that is significant to the fair value measurement.

The carrying amounts of the Company’s financial instruments, including accounts receivable, accounts payable and accrued liabilities, approximate fair value due to their relatively short maturities. Upon consummation of the Company's initial public offering on April 2, 2012, prior to the automatic conversion of the convertible preferred stock warrant into a common stock warrant, it was remeasured and the change in fair value was recorded as a non-cash charge in other income (expense), net and the related liability was reclassified to additional paid-in capital (see Note 8).

Inventories

Inventories

Inventories are recorded at the lower of cost (determined under the first-in-first-out method) or market. Write downs are provided for finished goods expected to become nonsaleable due to age and provisions are specifically made for slow-moving or obsolete raw ingredients and packaging material. The Company also adjusts the carrying value of its inventories when it believes that the net realizable value is less than the carrying value. These write-downs are measured as the difference between the cost of the inventory, including estimated costs to complete, and estimated selling prices, including cost of selling. These charges are recorded as a component of cost of sales.

Property and Equipment

Property and Equipment

Property and equipment are stated at cost. Depreciation is computed using the straight-line method over the estimated useful lives of the assets. Leasehold improvements are amortized using the straight-line method over the shorter of the lease term or estimated useful lives. Maintenance and repairs are charged to expense as incurred. Assets not yet placed in use are not depreciated.

The useful lives of the property and equipment are as follows:

Equipment and automotive	3 to 7 years
Software	3 to 7 years
Plates and dies	3 years
Leasehold improvements	Shorter of lease term or estimated useful life

The Company capitalizes certain internal and external costs related to the development and enhancement of the Company’s internal-use software. Capitalized internal-use software development costs are included in property and equipment on the accompanying condensed consolidated balance sheets. As of December 31, 2013, the Company had $2.3 million capitalized software development costs, net of accumulated amortization, including $0.6 million in construction-in-progress. As of March 31, 2013, the Company had $2.1 million capitalized software development costs, net of accumulated amortization, including $0.4 million in construction-in-progress.

Intangible Assets

Intangible Assets

Intangible assets with determinable lives are amortized using the straight-line method.

Freight and Warehousing Costs

Freight and Warehousing Costs

Freight and warehousing costs are included in selling, general and administrative expenses in the condensed consolidated statements of operations. Freight and warehousing costs primarily consist of costs associated with moving finished products to customers, including costs associated with the Company’s distribution center, route delivery costs and the cost of shipping products to customers through third-party carriers. Freight and warehousing costs recorded as a component of selling, general and administrative expenses were $1.8 million and $1.4 million for the three months ended December 31, 2013 and 2012, respectively, and were $5.2 million and $4.2 million for the nine months ended December 31, 2013 and 2012, respectively.

Research and Development Costs

Research and Development (R&D) Costs

R&D costs consist of the costs incurred to develop new products and are expensed as incurred. These costs include consumer research, prototype development, materials and resources to conduct trial production runs, package development and employee-related costs for personnel responsible for product innovation. R&D costs recorded as a component of selling, general and administrative expenses were $0.5 million and $0.6 million for the three months ended December 31, 2013 and 2012, respectively, and were $1.7 million and $2.1 million for the nine months ended December 31, 2013 and 2012, respectively.

Advertising Costs

Advertising Costs

Advertising costs include the costs of producing and communicating advertisements. The costs of producing advertisements are expensed as incurred and the costs of communicating advertising are expensed over the period of communication. Total advertising costs for the three months ended December 31, 2013 and 2012 included in selling, general and administrative expenses were $0.4 million and $0.2 million, respectively, and were $1.2 million and $0.6 million for the nine months ended December 31, 2013 and 2012, respectively.

Product Recall

Product Recall

The Company establishes reserves for product recalls on a product-specific basis when circumstances giving rise to the recall become known. The Company, when establishing reserves for a product recall, considers cost estimates for any fees and incentives to customers for their effort to return the product, freight and destruction charges for returned products, warehouse and inspection fees, repackaging materials, point-of-sale materials and other costs including costs incurred by contract manufacturers. Additionally, the Company estimates product returns from consumers and customers across distribution channels, utilizing third-party data and other assumptions. These factors are updated and re-evaluated each period and the related reserves are adjusted when these factors indicate that the recall reserves are either insufficient to cover or exceed the estimated product recall expenses.

Significant changes in the assumptions used to develop estimates for product recall reserves could affect key financial information, including accounts receivable, inventory, accrued liabilities, net sales, gross profit, operating expenses and net income. In addition, estimating product recall reserves requires a high degree of judgment in areas such as estimating consumer returns, shelf and in-stock inventory at retailers across distribution channels, fees and incentives to be earned by customers for their effort to return the products, future freight rates and consumers’ claims.

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Balance Sheet Components - Intangible Assets, Net (Detail) (USD $) In Thousands, unless otherwise specified							9 Months Ended
	Dec. 31, 2013	Mar. 31, 2013	Dec. 31, 2013 Product formulas	Mar. 31, 2013 Product formulas	Dec. 31, 2013 Other intangible assets	Mar. 31, 2013 Other intangible assets	Dec. 31, 2013 Minimum Product formulas	Dec. 31, 2013 Minimum Other intangible assets	Dec. 31, 2013 Maximum Product formulas	Dec. 31, 2013 Maximum Other intangible assets
Finite-Lived Intangible Assets [Line Items]
Gross carrying amount	$ 1,212	$ 1,212	$ 1,023	$ 1,023	$ 189	$ 189
Accumulated amortization	(141)	(96)	(106)	(68)	(35)	(28)
Net carrying amount	$ 1,071	$ 1,116	$ 917	$ 955	$ 154	$ 161
Useful life of intangible assets							5 years	5 years	25 years	25 years

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Balance Sheet Components (Tables)

9 Months Ended

Dec. 31, 2013

Supplemental Balance Sheet Disclosures [Abstract]

Inventory

Inventory is comprised of the following (in thousands):

	December 31, 2013		March 31, 2013
Raw materials	$	2,659	$	1,391
Work in process	1,494		2,142
Finished goods	19,254		11,614
Inventory	$	23,407	$	15,147

Components of property and equipment

The useful lives of the property and equipment are as follows:

Equipment and automotive	3 to 7 years
Software	3 to 7 years
Plates and dies	3 years
Leasehold improvements	Shorter of lease term or estimated useful life

Property and equipment, net are comprised of the following (in thousands):

	December 31, 2013			March 31, 2013
Equipment and automotive	$	3,897		$	2,959
Software	2,570			2,410
Leasehold improvements	1,342			1,195
Plates and dies	333			244
Total property and equipment	8,142			6,808
Less: Accumulated depreciation and amortization	(2,745		)	(1,760		)
Construction in progress	809			1,090
Property and equipment, net	$	6,206		$	6,138

Intangible assets, net

Intangible assets, net are comprised of the following (in thousands):

	December 31, 2013							March 31, 2013
	Gross					Net		Gross					Net
	Carrying		Accumulated			Carrying		Carrying		Accumulated			Carrying		Useful
	Amount		Amortization			Amount		Amount		Amortization			Amount		Lives
Product formulas	$	1,023	$	(106	)	$	917	$	1,023	$	(68	)	$	955	5 - 25 years
Other intangible assets	189		(35		)	154		189		(28		)	161		5 - 25 years
Total	$	1,212	$	(141	)	$	1,071	$	1,212	$	(96	)	$	1,116

Components of accrued liabilities

The following table shows the components of accrued liabilities (in thousands):

	December 31, 2013		March 31, 2013
Payroll and employee-related expenses	$	2,903	$	3,779
Accrued trade expenses	2,394		2,299
Inventory received not invoiced	2,720		4,038
Deferred rent	249		260
Brokerage commissions	320		407
Other accrued liabilities	518		1,238
Total accrued liabilities	$	9,104	$	12,021

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Summary of Significant Accounting Policies

9 Months Ended

Dec. 31, 2013

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

Summary of Significant Accounting Policies

Basis of Presentation and Consolidation

The accompanying interim condensed consolidated statements of operations for the three and nine months ended December 31, 2013 and 2012, the interim condensed consolidated balance sheets as of December 31, 2013 and March 31, 2013, the interim condensed consolidated statement of stockholders’ equity for the nine months ended December 31, 2013, and the interim condensed consolidated statements of cash flows for the nine months ended December 31, 2013 and 2012 are unaudited. These unaudited interim condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and the applicable rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial information. Accordingly, they do not include all of the information and notes required by U.S. GAAP for complete financial statements. These unaudited interim condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto contained in Company’s Annual Report on Form 10-K filed with the SEC on June 14, 2013. The March 31, 2013 condensed consolidated balance sheet included herein was derived from the audited financial statements as of that date, but does not include all disclosures including notes required by U.S. GAAP for complete financial statements.

The unaudited interim condensed consolidated financial statements have been prepared on the same basis as the audited consolidated financial statements and, in the opinion of management, reflect all adjustments of a normal recurring nature considered necessary to state fairly the Company's financial position as of December 31, 2013 and results of its operations for the three and nine months ended December 31, 2013 and 2012, and the cash flows for the nine months ended December 31, 2013 and 2012. The interim results for the nine months ended December 31, 2013 are not necessarily indicative of the results that may be expected for the year ending March 31, 2014.

The unaudited interim condensed consolidated financial statements include the accounts of the Company and its wholly owned direct and indirect subsidiaries, Annie’s Homegrown, Inc., Annie’s Enterprises, Inc., Napa Valley Kitchen, Inc. and Annie's Baking, LLC. All significant intercompany balances and transactions have been eliminated in consolidation. Certain reclassifications were made to the Company's prior financial statements to conform to the current year presentation.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of sales and expenses during the reported periods. Actual results could differ from those estimates.

Accounts Receivable and Concentration Risk

The Company manages credit risk through credit approvals, credit limits and monitoring procedures. The Company performs periodic credit evaluations of its customers and records an allowance for uncollectible accounts receivable based on a specific identification methodology. In addition, management may record an additional allowance based on the Company’s experience with accounts receivable aging categories. Accounts receivable are recorded net of allowances for trade discounts and doubtful accounts. The Company had $21,000 for allowance for doubtful accounts as of December 31, 2013. The Company had no allowance for doubtful accounts as of March 31, 2013.

Customers with 10% or more of the Company’s net sales consist of the following:

	Net Sales
	Customer A		Customer B		Customer C
Three Months Ended December 31,
2013	22	%	18	%	11	%
2012	25	%	17	%	11	%
Nine Months Ended December 31,
2013	21	%	15	%	13	%
2012	26	%	13	%	12	%

As of December 31, 2013, two customers represented 31% and 18%, respectively, of accounts receivable. As of March 31, 2013, three customers represented 36%, 26%, and 10%, respectively, of accounts receivable.

Fair Value of Financial Instruments

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the reporting date. The accounting guidance establishes a three-tiered hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value:

Level 1—Quoted prices in active markets for identical assets or liabilities.

Level 2—Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

The categorization of a financial instrument within the valuation hierarchy is based on the lowest level of input that is significant to the fair value measurement.

The carrying amounts of the Company’s financial instruments, including accounts receivable, accounts payable and accrued liabilities, approximate fair value due to their relatively short maturities. Upon consummation of the Company's initial public offering on April 2, 2012, prior to the automatic conversion of the convertible preferred stock warrant into a common stock warrant, it was remeasured and the change in fair value was recorded as a non-cash charge in other income (expense), net and the related liability was reclassified to additional paid-in capital (see Note 8).

Inventories

Inventories are recorded at the lower of cost (determined under the first-in-first-out method) or market. Write downs are provided for finished goods expected to become nonsaleable due to age and provisions are specifically made for slow-moving or obsolete raw ingredients and packaging material. The Company also adjusts the carrying value of its inventories when it believes that the net realizable value is less than the carrying value. These write-downs are measured as the difference between the cost of the inventory, including estimated costs to complete, and estimated selling prices, including cost of selling. These charges are recorded as a component of cost of sales.

Property and Equipment

Property and equipment are stated at cost. Depreciation is computed using the straight-line method over the estimated useful lives of the assets. Leasehold improvements are amortized using the straight-line method over the shorter of the lease term or estimated useful lives. Maintenance and repairs are charged to expense as incurred. Assets not yet placed in use are not depreciated.

The useful lives of the property and equipment are as follows:

Equipment and automotive	3 to 7 years
Software	3 to 7 years
Plates and dies	3 years
Leasehold improvements	Shorter of lease term or estimated useful life

The Company capitalizes certain internal and external costs related to the development and enhancement of the Company’s internal-use software. Capitalized internal-use software development costs are included in property and equipment on the accompanying condensed consolidated balance sheets. As of December 31, 2013, the Company had $2.3 million capitalized software development costs, net of accumulated amortization, including $0.6 million in construction-in-progress. As of March 31, 2013, the Company had $2.1 million capitalized software development costs, net of accumulated amortization, including $0.4 million in construction-in-progress.

Intangible Assets

Intangible assets with determinable lives are amortized using the straight-line method.

Freight and Warehousing Costs

Freight and warehousing costs are included in selling, general and administrative expenses in the condensed consolidated statements of operations. Freight and warehousing costs primarily consist of costs associated with moving finished products to customers, including costs associated with the Company’s distribution center, route delivery costs and the cost of shipping products to customers through third-party carriers. Freight and warehousing costs recorded as a component of selling, general and administrative expenses were $1.8 million and $1.4 million for the three months ended December 31, 2013 and 2012, respectively, and were $5.2 million and $4.2 million for the nine months ended December 31, 2013 and 2012, respectively.

Research and Development (R&D) Costs

R&D costs consist of the costs incurred to develop new products and are expensed as incurred. These costs include consumer research, prototype development, materials and resources to conduct trial production runs, package development and employee-related costs for personnel responsible for product innovation. R&D costs recorded as a component of selling, general and administrative expenses were $0.5 million and $0.6 million for the three months ended December 31, 2013 and 2012, respectively, and were $1.7 million and $2.1 million for the nine months ended December 31, 2013 and 2012, respectively.

Advertising Costs

Advertising costs include the costs of producing and communicating advertisements. The costs of producing advertisements are expensed as incurred and the costs of communicating advertising are expensed over the period of communication. Total advertising costs for the three months ended December 31, 2013 and 2012 included in selling, general and administrative expenses were $0.4 million and $0.2 million, respectively, and were $1.2 million and $0.6 million for the nine months ended December 31, 2013 and 2012, respectively.

Product Recall

The Company establishes reserves for product recalls on a product-specific basis when circumstances giving rise to the recall become known. The Company, when establishing reserves for a product recall, considers cost estimates for any fees and incentives to customers for their effort to return the product, freight and destruction charges for returned products, warehouse and inspection fees, repackaging materials, point-of-sale materials and other costs including costs incurred by contract manufacturers. Additionally, the Company estimates product returns from consumers and customers across distribution channels, utilizing third-party data and other assumptions. These factors are updated and re-evaluated each period and the related reserves are adjusted when these factors indicate that the recall reserves are either insufficient to cover or exceed the estimated product recall expenses.

Significant changes in the assumptions used to develop estimates for product recall reserves could affect key financial information, including accounts receivable, inventory, accrued liabilities, net sales, gross profit, operating expenses and net income. In addition, estimating product recall reserves requires a high degree of judgment in areas such as estimating consumer returns, shelf and in-stock inventory at retailers across distribution channels, fees and incentives to be earned by customers for their effort to return the products, future freight rates and consumers’ claims.

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Condensed Consolidated Statements of Operations (USD $) In Thousands, except Share data, unless otherwise specified	3 Months Ended		9 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2013	Dec. 31, 2012
Net sales	$ 46,177	$ 36,283	$ 143,867	$ 117,262
Cost of sales	27,951	23,267	88,978	72,539
Gross profit	18,226	13,016	54,889	44,723
Operating expenses:
Selling, general and administrative expenses	13,421	10,687	37,286	32,437
Income from operations	4,805	2,329	17,603	12,286
Interest expense	(80)	(40)	(255)	(120)
Other income (expense), net	30	31	88	116
Income before provision for income taxes	4,755	2,320	17,436	12,282
Provision for income taxes	1,966	919	7,066	4,965
Net income	$ 2,789	$ 1,401	$ 10,370	$ 7,317
Net income per share
-Basic (in dollars per share)	$ 0.16	$ 0.08	$ 0.61	$ 0.43
-Diluted (in dollars per share)	$ 0.16	$ 0.08	$ 0.60	$ 0.41
Weighted average shares of common stock outstanding used in computing net income per share
-Basic (shares)	16,937,139	17,249,536	16,901,089	17,085,833
-Diluted (shares)	17,398,006	17,781,720	17,386,408	17,702,221

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Income Taxes

9 Months Ended

Dec. 31, 2013

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

The Company’s effective tax rate increased to 41.3% for the three months ended December 31, 2013, compared to 39.6% for the three months ended December 31, 2012. The effective tax rate was 40.5% for the nine months ended December 31, 2013, compared to 40.4% for the nine months ended December 31, 2012. The effective tax rate is based on a projection of the Company’s annual fiscal year results. The effective tax rate for the three and nine months ended December 31, 2013 was higher than the effective tax rate for the three and nine months ended December 31, 2012 due to the impact of permanent items and federal and state income tax credits.

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Document and Entity Information	9 Months Ended
	Dec. 31, 2013	Jan. 31, 2014
Document Information [Line Items]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Dec. 31, 2013
Document Fiscal Year Focus	2014
Document Fiscal Period Focus	Q3
Trading Symbol	BNNY
Entity Registrant Name	ANNIE'S, INC.
Entity Central Index Key	0001431897
Current Fiscal Year End Date	--03-31
Entity Filer Category	Accelerated Filer
Entity Common Stock, Shares Outstanding		16,998,675

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Earnings per share

9 Months Ended

Dec. 31, 2013

Earnings Per Share [Abstract]

Net Income per Share of Common Stock attributable to Common Stockholders

Basic earnings per share is calculated by dividing the net income by the weighted-average number of shares of common stock outstanding for the period. Diluted earnings per share is computed by giving effect to all potentially dilutive securities outstanding during the period. The Company utilizes the treasury stock method to calculate potential common shares that underlie its stock options to purchase common stock and restricted stock units. Performance share units were excluded from potential common shares since no shares were issuable as of December 31, 2013 and March 31, 2013. Certain stock options to purchase our common stock and restricted stock units had an anti-dilutive effect on the earnings per share for the periods presented, and were also excluded.

The following outstanding shares of potentially dilutive securities were excluded from the computation of diluted earnings per share of common stock for the periods presented, because including them would have been anti-dilutive:

	Three Months Ended December 31,		Nine Months Ended December 31,
	2013	2012	2013	2012
Options to purchase common stock	105,157	2,562	105,157	2,562
Restricted stock units	5,141	—	10,575	6,256
Total	110,298	2,562	115,732	8,818

A reconciliation of the basic and diluted earnings per share attributable to common stockholders is as follows (in thousands except share and per share amounts):

	Three Months Ended December 31,				Nine Months Ended December 31,
	2013		2012		2013		2012
Earnings per share:
Net income	$	2,789	$	1,401	$	10,370	$	7,317
Weighted average shares of common stock outstanding used in computing earnings—basic	16,937,139		17,249,536		16,901,089		17,085,833
Potential dilutive options	444,822		523,881		471,427		609,222
Potential dilutive restricted stock units	16,045		8,303		13,892		7,166
Weighted average shares of common stock outstanding used in computing earnings—diluted	17,398,006		17,781,720		17,386,408		17,702,221
Earnings per share
—Basic	$	0.16	$	0.08	$	0.61	$	0.43
—Diluted	$	0.16	$	0.08	$	0.60	$	0.41

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Condensed Consolidated Statement of Stockholders' Equity (USD $) In Thousands, except Share data	Total	Common Stock	Additional Paid-in Capital	Accumulated Deficit
Beginning Balance at Mar. 31, 2013	$ 65,929	$ 17	$ 93,190	$ (27,278)
Beginning Balance (in shares) at Mar. 31, 2013		16,849,016
Exercise of stock options (in shares)	123,364	123,364
Exercise of stock options	1,211		1,211
Excess tax benefit from stock-based compensation	1,467		1,467
Stock-based compensation	660		660
Net income	10,370			10,370
Ending Balance at Dec. 31, 2013	$ 79,637	$ 17	$ 96,528	$ (16,908)
Ending Balance (in shares) at Dec. 31, 2013		16,972,380

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Commitments and Contingencies

9 Months Ended

Dec. 31, 2013

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

Lease Commitments

The Company leases its offices and other equipment under non-cancelable operating leases that expire through fiscal year 2019. Rent expense for non-cancelable operating leases with scheduled rent increases is recognized on a straight-line basis over the lease term. Rent expense for the three and nine months ended December 31, 2013 was $155,000 and $461,000, respectively. Rent expense for the three and nine months ended December 31, 2012 was $146,000 and $386,000, respectively.

Future minimum lease payments under the non-cancelable operating leases as of December 31, 2013 are as follows (in thousands):

	Lease Payments
Three Months Ending March 31, 2014	$	166
Fiscal Year Ending March 31:
2015	675
2016	673
2017	669
2018	662
2019	586
Total future minimum lease payments	$	3,431

Purchase Commitments

The Company has material non-cancelable purchase commitments, directly or through contract manufacturers, to purchase ingredients to be used in the future to manufacture its products. As of December 31, 2013, the Company’s purchase commitments totaled $15.9 million, which will substantially be incurred within a year.

In September 2011, the Company entered into an agreement with its contract warehousing company that includes minimum overhead fees of $200,000 annually beginning April 1, 2012 through June 30, 2015. As of December 31, 2013, the remaining obligation under the agreement for overhead fees was $300,000.

In November 2011, the Company entered into an agreement with one of its contract manufacturers for the purchase of product formulas for a purchase price of $2.0 million. The agreement requires annual payments of at least $150,000 in each of the first six years of the agreement with the balance of the $2.0 million payment due at the end of the seven-year term in November 2018. As of December 31, 2013, the Company’s remaining obligation for product formulas was $1.7 million.

Indemnifications

In the normal course of business, the Company enters into contracts that contain a variety of representations and provide for general indemnifications. The Company’s exposure under these agreements is unknown because it involves claims that may be made against the Company in the future but have not yet been made. The Company has not paid any significant claims or been required to defend any action related to its indemnification obligations, and, accordingly, the Company believes that the estimated fair value of these indemnification obligations is minimal and has not accrued any amounts for these obligations.

Legal Matters

On December 6, 2013, a private organization called the Center for Environmental Health (“CEH”) sued the Company and its subsidiary, Annie’s Homegrown, Inc., in Superior Court of the State of California in the County of Alameda under California Health & Safety Code §§ 25249.5 et seq. (commonly referred to as “Proposition 65”). CEH claims that warnings are required in California under Proposition 65 for alleged exposures to lead and lead compounds from cookies that contain ginger or molasses, including Annie’s Gluten-Free Ginger Snap Bunny Cookies. CEH is seeking injunctive relief, civil penalties of $2,500 per violation per day and its attorneys’ fees and costs. The lawsuit, entitled Mondelez International, Inc., et al., Alameda County Superior Court Case No. RG13-677800, names nine other companies that are either suppliers or retailers of ginger- or molasses-containing cookies. The Company cannot at this time reasonably estimate a range of exposure, if any, of the potential liability relating to this suit.

Additionally, from time to time, the Company is subject to claims, assessments or other legal proceedings in the ordinary course of business, including product liability claims, employee claims, and other general liability claims. While it is not feasible to predict or determine the ultimate outcome of these matters, the Company believes that none of these legal proceedings, individually or in the aggregate, will have a material adverse effect on its financial position.

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Related Party Transactions

9 Months Ended

Dec. 31, 2013

Related Party Transactions [Abstract]

Related Party Transactions

Related Party Transactions

Agreements with Solera Capital, LLC

The Company had an advisory services agreement with Solera, which it terminated upon the consummation of the IPO and as such the Company paid Solera a one-time termination fee of $1.3 million in April 2012.

Additionally, the Company is a party to an amended and restated registration rights agreement dated as of November 14, 2005, or Registration Rights Agreement, relating to shares of common stock of the Company held by certain affiliates of Solera and certain other stockholders. As discussed further below, on November 18, 2013 Solera completed the sale of its shares entitled to registration under this agreement.

On August 6, 2012, the Company closed a secondary public offering, in which certain stockholders, including Solera, sold 3,649,976 shares of common stock of the Company at an offering price of $39.25 per share. The Company did not receive any proceeds from the sale of shares by the selling stockholders. The offering expenses incurred by the Company were $0.7 million, including legal, accounting and various other fees associated with the registration and sale of common stock sold in the secondary public offering.

On November 18, 2013, the Company closed a secondary public offering in which Solera sold remaining 2,537,096 shares of common stock of the Company at an offering price of $47.95 per share. The Company did not receive any proceeds from the sale of shares by Solera. The offering expenses incurred by the Company were $0.3 million in the nine months ended December 31, 2013, including legal, accounting and various other fees associated with the registration and sale of common stock of the Company sold in the secondary public offering.

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Summary of Significant Accounting Policies (Tables)

9 Months Ended

Dec. 31, 2013

Accounting Policies [Abstract]

Customers with 10% or more of net sales

Customers with 10% or more of the Company’s net sales consist of the following:

	Net Sales
	Customer A		Customer B		Customer C
Three Months Ended December 31,
2013	22	%	18	%	11	%
2012	25	%	17	%	11	%
Nine Months Ended December 31,
2013	21	%	15	%	13	%
2012	26	%	13	%	12	%

Useful lives of property and equipment

The useful lives of the property and equipment are as follows:

Equipment and automotive	3 to 7 years
Software	3 to 7 years
Plates and dies	3 years
Leasehold improvements	Shorter of lease term or estimated useful life

Property and equipment, net are comprised of the following (in thousands):

	December 31, 2013			March 31, 2013
Equipment and automotive	$	3,897		$	2,959
Software	2,570			2,410
Leasehold improvements	1,342			1,195
Plates and dies	333			244
Total property and equipment	8,142			6,808
Less: Accumulated depreciation and amortization	(2,745		)	(1,760		)
Construction in progress	809			1,090
Property and equipment, net	$	6,206		$	6,138

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Geographic Areas and Product Sales

9 Months Ended

Dec. 31, 2013

Segment Reporting [Abstract]

Geographic Areas and Product Sales

Geographic Areas and Product Sales

The Company’s net sales by geographic area, based on the location to which the product was shipped, are summarized as follows (in thousands):

	Three Months Ended December 31,				Nine Months Ended December 31,
	2013		2012		2013		2012
United States	$	44,459	$	34,413	$	138,130	$	111,984
Canada	1,718		1,870		5,737		5,278
	$	46,177	$	36,283	$	143,867	$	117,262

The following table sets forth net sales by product category (in thousands):

	Three Months Ended December 31,				Nine Months Ended December 31,
	2013		2012		2013		2012
Meals	$	23,933	$	16,223	$	70,226	$	52,759
Snacks	17,075		14,908		54,953		47,517
Dressings, condiments and other	5,169		5,152		18,688		16,986
	$	46,177	$	36,283	$	143,867	$	117,262

All of the Company’s long-lived assets are located in the U.S.

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Common Stock

9 Months Ended

Dec. 31, 2013

Equity [Abstract]

Common Stock

Common Stock

As of each of December 31, 2013 and March 31, 2013, the Company’s certificate of incorporation authorized 30,000,000 shares of common stock, $0.001 par value per share, respectively, of which 16,972,380 and 16,849,016 shares were issued and outstanding, respectively. Each share of the common stock has the right to one vote. The holders of common stock are also entitled to receive dividends if, as and when declared by the Company’s Board of Directors. No dividends were declared or paid during the nine months ended December 31, 2013 and 2012.

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Convertible Preferred Stock Warrant

9 Months Ended

Dec. 31, 2013

Convertible Preferred Stock Warrant Disclosure [Abstract]

Convertible Preferred Stock Warrant

Convertible Preferred Stock Warrant

In March 2008, in connection with a prior term loan, the Company had issued a warrant to Hercules Technology II, L.P. (“Hercules”) for the purchase of 80,560 shares of Series A 2005 Convertible Preferred Stock at an exercise price of $8.07 per share. The warrant was immediately exercisable on the date of issuance and was scheduled to expire at the earlier of five years from a qualifying IPO of the Company’s common stock or April 1, 2018. Upon the consummation of the Company’s IPO on April 2, 2012, the warrant became a warrant to purchase 80,560 shares of the Company’s common stock. As such, on April 2, 2012, the Company measured the fair value of the outstanding convertible preferred stock warrant using an option pricing method and recorded a non-cash charge of $13,000 related to the increase in the fair value of the convertible preferred stock warrant in other income (expense), net and the related convertible preferred stock warrant liability was reclassified to additional paid-in capital. On April 12, 2012, Hercules exercised the warrant to purchase 80,560 shares of the Company’s common stock by surrendering 17,367 shares to pay for the exercise. As a result, the Company issued Hercules 63,193 shares of the Company's common stock.

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Preferred Stock

9 Months Ended

Dec. 31, 2013

Equity [Abstract]

Preferred Stock

Preferred Stock

As of each of December 31, 2013 and March 31, 2013, the Company’s certificate of incorporation authorized 5,000,000 shares of preferred stock, $0.001 par value per share. As of December 31, 2013, no certificate of designations defining the rights and preferences of the preferred stock had been filed and no shares of preferred stock were issued and outstanding.

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Stock-Based Compensation

9 Months Ended

Dec. 31, 2013

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Stock-Based Compensation

Stock-Based Compensation

The Company has adopted performance incentive plans (the 2004 Stock Option Plan and the Omnibus Incentive Plan, which together are the “Plans”) under which non-qualified stock options, restricted stock units and performance share units are granted to eligible employees, officers and directors. The Company has also granted non-plan performance based option awards to certain key management. Options granted under Plans to date generally vest over a five-year period from the date of grant. Vested options can be exercised and generally expire ten years after the grant date. The restricted stock units granted to employees vest 50% on the second anniversary of the grant date, and the remaining 50% on the third anniversary of the grant date. The performance share units granted to employees vest based on achievement of required cumulative compounded adjusted diluted earnings per share growth during the stipulated three-year period applicable to a grant. The vesting of stock-based awards is subject to continuance of the employment with or service to the Company.

Stock-based compensation expense included in selling, general and administrative expenses was $251,000 and $230,000 for the three months ended December 31, 2013 and 2012, respectively, and $660,000 and $677,000 for the nine months ended December 31, 2013 and 2012, respectively.

The following table summarizes the activity of stock options during the nine months ended December 31, 2013:

	Number of Shares		Weighted-Average Exercise Price
Balance at March 31, 2013	1,203,990		$	13.26
Granted	62,387		41.87
Forfeited	(99,066	)	18.28
Exercised	(123,364	)	9.81
Balance at December 31, 2013	1,043,947		$	14.90

The weighted average grant date fair value of employee stock options granted during the nine months ended December 31, 2013 was $15.76 per share. The total intrinsic value of stock options exercised during the nine months ended December 31, 2013 was $4.1 million. The intrinsic value is calculated based on the difference between the exercise price and the fair value of the common stock at time of exercise.

The following table summarizes the activity of unvested restricted stock units and performance share units during the nine months ended December 31, 2013:

Shares-Based Awards	Shares		Weighted-Average Grant Date Fair Value
Unvested at March 31, 2013	71,165		$	21.73
Granted	54,806		41.11
Vested	(4,692	)	45.27
Forfeited	(19,922	)	24.94
Unvested at December 31, 2013	101,357		$	30.49

As of December 31, 2013, there were 70,872 unvested performance share units outstanding, net of actual forfeitures. As of December 31, 2013, the number of shares estimated to be issued at the end of the performance period(s) is a total of 35,441 shares. The maximum number of total shares that could be issued at the end of performance period(s) is 106,313 shares.

As of December 31, 2013, there was $4.0 million of total unrecognized compensation cost related to unvested share-based compensation arrangements which is expected to be recognized over a weighted average period of 3.0 years.

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Balance Sheet Components - Inventory (Detail) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2013	Mar. 31, 2013
Supplemental Balance Sheet Disclosures [Abstract]
Raw materials	$ 2,659	$ 1,391
Work in process	1,494	2,142
Finished goods	19,254	11,614
Inventory	$ 23,407	$ 15,147

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Earnings per share - Reconciliation of Basic and Diluted Net Income Per Share Attributable to Common Stockholders (Detail) (USD $) In Thousands, except Share data, unless otherwise specified	3 Months Ended		9 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2013	Dec. 31, 2012
Net income per share:
Net income	$ 2,789	$ 1,401	$ 10,370	$ 7,317
Weighted average shares of common stock outstanding used in computing net income-basic	16,937,139	17,249,536	16,901,089	17,085,833
Weighted average shares of common stock outstanding used in computing net income-diluted	17,398,006	17,781,720	17,386,408	17,702,221
Net income per share
-Basic (in dollars per share)	$ 0.16	$ 0.08	$ 0.61	$ 0.43
-Diluted (in dollars per share)	$ 0.16	$ 0.08	$ 0.60	$ 0.41
Stock Options
Net income per share:
Potential dilutive	444,822	523,881	471,427	609,222
Restricted Stock Units
Net income per share:
Potential dilutive	16,045	8,303	13,892	7,166

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Planned Acquisition

9 Months Ended

Dec. 31, 2013

Business Combinations [Abstract]

Planned acquisition

Planned Acquisition

On November 5, 2013, the Company entered into an agreement of purchase and sale (the "Purchase Agreement") with Safeway Inc. and Safeway Australia Holdings, Inc. (together the “Selling Parties”) to acquire a snack manufacturing plant in Joplin, Missouri (the “Joplin Plant”) for $6.0 million of cash, plus the value of inventory and supplies at closing (calculated based on the Selling Parties’ costs and currently estimated at approximately $4.0 million). The Company expects to fund the acquisition with cash from operations and, if necessary, by drawing under its revolving credit facility. The Company expects to close the acquisition in the first quarter of fiscal 2015. The Joplin Plant has been the primary manufacturer of the Company’s cookie and cracker products for more than ten years. Company products produced in the Joplin Plant currently account for over 50% of its total snacks net sales and represent the majority of the Joplin Plant’s total production volume. In connection with the closing of the acquisition, the Company expects to enter into a three-year supply agreement with an affiliate of Safeway Inc., pursuant to which the Company will manufacture products for the affiliate. Further, in connection with the planned acquisition, on November 7, 2013, the Company deposited $300,000 in an escrow account with the title insurance company. This amount is reflected as restricted cash on the condensed consolidated balance sheet at December 31, 2013.

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Stock-Based Compensation (Tables)

9 Months Ended

Dec. 31, 2013

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Summary of Activity of Stock Options

The following table summarizes the activity of stock options during the nine months ended December 31, 2013:

	Number of Shares		Weighted-Average Exercise Price
Balance at March 31, 2013	1,203,990		$	13.26
Granted	62,387		41.87
Forfeited	(99,066	)	18.28
Exercised	(123,364	)	9.81
Balance at December 31, 2013	1,043,947		$	14.90

Summary of Activity of Unvested Restricted Stock Units and Performance Share Units

The following table summarizes the activity of unvested restricted stock units and performance share units during the nine months ended December 31, 2013:

Shares-Based Awards	Shares		Weighted-Average Grant Date Fair Value
Unvested at March 31, 2013	71,165		$	21.73
Granted	54,806		41.11
Vested	(4,692	)	45.27
Forfeited	(19,922	)	24.94
Unvested at December 31, 2013	101,357		$	30.49

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Income Taxes - Additional Information (Detail)	3 Months Ended		9 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2013	Dec. 31, 2012
Income Tax Disclosure [Abstract]
Effective Income Tax Rate	41.30%	39.60%	40.50%	40.40%

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Commitments and Contingencies - Future Minimum Lease Payments under Non-cancelable Operating Leases (Detail) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2013
Commitments and Contingencies Disclosure [Abstract]
Operating Leases, Future Minimum Payments, Remainder of Fiscal Year	$ 166
2014	675
2015	673
2016	669
2017	662
2018	586
Total future minimum lease payments	$ 3,431

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Condensed Consolidated Statements of Cash Flows (USD $) In Thousands, unless otherwise specified	9 Months Ended
	Dec. 31, 2013	Dec. 31, 2012
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$ 10,370	$ 7,317
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	1,035	749
Stock-based compensation	660	677
Provision for doubtful accounts	21	0
Excess tax benefit from stock-based compensation	(1,467)	(7,499)
Accretion of imputed interest on purchase of intangible asset	107	107
Change in fair value of convertible preferred stock warrant liability	0	13
Amortization of deferred financing costs	9	12
Gain (Loss) on Disposition of Property Plant Equipment	1	0
Deferred taxes	144	535
Changes in operating assets and liabilities:
Accounts receivable, net	1,198	1,760
Inventory	(8,260)	(10,925)
Income tax receivable	(400)	425
Prepaid expenses, other current and non-current assets	(516)	4,400
Accounts payable	2,440	3,417
Related-party payable	0	(1,305)
Accrued expenses and other non-current liabilities	(1,592)	4,527
Net cash provided by operating activities	3,750	4,210
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment	(1,057)	(1,498)
Increase (Decrease) in Restricted Cash	(300)	0
Net cash used in investing activities	(1,357)	(1,498)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from credit facility	8,432	2,952
Payments to credit facility	(15,439)	(15,748)
Proceeds from common shares issued in initial public offering, net of issuance costs	0	11,146
Payment for intangible asset acquired by financing transaction	(8)	(7)
Excess tax benefit from stock-based compensation	1,467	7,499
Proceeds from exercises of stock options	1,211	3,844
Net cash provided by (used in) financing activities	(4,337)	9,686
NET INCREASE IN CASH	(1,944)	12,398
CASH-Beginning of period	4,930	562
CASH-End of period	2,986	12,960
NONCASH INVESTING AND FINANCING ACTIVITIES:
Purchase of property and equipment funded through accounts payable	2	425
Conversion of convertible preferred stock into common stock	$ 0	$ 81,373

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Credit Facility

9 Months Ended

Dec. 31, 2013

Debt Disclosure [Abstract]

Credit Facility

Credit Facility

In December 2011, the Company entered into a second amended and restated loan agreement (as amended from time to time, the "Credit Agreement") with Bank of America, N. A. that, among other things, provided for an increase in its revolving credit facility to $20.0 million and an extension of the term through August 2014. In March 2013, the Company entered into an amendment to its Credit Agreement. This amendment provides for, among other things, an increase in the credit facility to $40.0 million and an extension of the term through August 2016. On November 5, 2013, the Company entered into another amendment to its Credit Agreement. This amendment provides for, among other things, consent for the Company to create a limited liability company and guarantee performance of the limited liability company in the event and to the extent the Company assigns to the limited liability company any of its rights or obligations under the Purchase Agreement dated November 5, 2013 among the Company, Safeway Inc. and Safeway Australia Holdings, LLC (see Note 16). Additionally, the amendment provides for the issuance of letters of credit and revises certain covenants and representations and warranties of the Company under the Credit Agreement. In connection with this amendment, Annie’s Baking, LLC, became a party to the Credit Agreement pursuant to a Joinder Agreement dated November 22, 2013. The credit facility is collateralized by substantially all of the Company’s assets.

The Company may select from three interest rate options for borrowings under the credit facility: (i) LIBOR (as defined in the Credit Agreement) plus 1.25%, (ii) IBOR (as defined in the Credit Agreement) plus 1.25% or (iii) Prime Rate (as defined in the Credit Agreement). Weighted average interest was 1.4% for each of the three and nine months ended December 31, 2013, respectively. Weighted average interest was 1.5% for each of the three and nine months ended December 31, 2012. The Company is required to pay a commitment fee on the unused credit facility commitments, if the outstanding balance is less than half the commitment, at an annual rate ranging from 0.25% to 0.40% depending on the utilization rate. As of December 31, 2013 and March 31, 2013, there was $40.0 million and $33.0 million, respectively, of borrowings available under the credit facility. Interest is payable monthly.

The Credit Agreement contains restrictions on, among other things, the Company’s ability to incur additional indebtedness, pay dividends or make other distributions and make investments and loans. The Credit Agreement also limits the Company’s ability to make capital expenditures in excess of $15.0 million. The Credit Agreement requires that the Company maintain a Funded Debt (as defined in the Credit Agreement) to Adjusted EBITDA (as defined in the Credit Agreement) ratio of not more than 2.75 to 1.0 and a minimum Net Worth (as defined in the Credit Agreement) equal to at least $50.0 million, plus 30% of earnings after taxes earned each quarter (if positive), beginning with the June 2013 quarterly earnings. The Credit Agreement requires the Company to submit interim and annual financial statements by specified dates after each reporting period. The Company was in compliance with the covenants as of December 31, 2013 and March 31, 2013.

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Earnings per share (Tables)

9 Months Ended

Dec. 31, 2013

Earnings Per Share [Abstract]

Outstanding Shares of Potentially Dilutive Securities Excluded from Computation of Diluted Net Income Per Share of Common Stock

The following outstanding shares of potentially dilutive securities were excluded from the computation of diluted earnings per share of common stock for the periods presented, because including them would have been anti-dilutive:

	Three Months Ended December 31,		Nine Months Ended December 31,
	2013	2012	2013	2012
Options to purchase common stock	105,157	2,562	105,157	2,562
Restricted stock units	5,141	—	10,575	6,256
Total	110,298	2,562	115,732	8,818

Reconciliation of Basic and Diluted Net Income Per Share Attributable to Common Stockholders

A reconciliation of the basic and diluted earnings per share attributable to common stockholders is as follows (in thousands except share and per share amounts):

	Three Months Ended December 31,				Nine Months Ended December 31,
	2013		2012		2013		2012
Earnings per share:
Net income	$	2,789	$	1,401	$	10,370	$	7,317
Weighted average shares of common stock outstanding used in computing earnings—basic	16,937,139		17,249,536		16,901,089		17,085,833
Potential dilutive options	444,822		523,881		471,427		609,222
Potential dilutive restricted stock units	16,045		8,303		13,892		7,166
Weighted average shares of common stock outstanding used in computing earnings—diluted	17,398,006		17,781,720		17,386,408		17,702,221
Earnings per share
—Basic	$	0.16	$	0.08	$	0.61	$	0.43
—Diluted	$	0.16	$	0.08	$	0.60	$	0.41

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Balance Sheet Components - Narrative (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2013	Dec. 31, 2012	Mar. 31, 2013
Balance Sheet Details [Line Items]
Depreciation expense incurred	$ 383	$ 271	$ 990	$ 704
Amortization expense	15	15	45	45
Future Amortization Expense, remainder of fiscal 2014	15		15
Future Amortization Expense 2015	60		60
Future Amortization Expense 2016	60		60
Future Amortization Expense 2017	60		60
Future Amortization Expense 2018	60		60
Future Amortization Expense 2019	60		60
Amortization expense thereafter	756		756
Prepaid expenses and other current assets	5,572		5,572		5,050
Contract manufacturers and suppliers
Balance Sheet Details [Line Items]
Prepaid expenses and other current assets	$ 4,200		$ 4,200		$ 3,900

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Product Recall

9 Months Ended

Dec. 31, 2013

Product Recall Disclosure [Abstract]

Product Recall

Product Recall

In January 2013, the Company announced a voluntary product recall of certified organic and made with organic pizza products due to the possible presence of fragments of flexible metal mesh from a faulty screen at a third-party flour mill. The Company initiated the recall of all lots of pizza product manufactured with this supplier’s flour from its first purchase from the supplier in May 2012. The Company recorded certain items associated with the recall in its financial results for the three and nine months ended December 31, 2013 and 2012.

The Company recorded the estimated customer and consumer returns as a reduction of net sales, related costs associated with product returns, destruction charges, inventory write-off and costs incurred by contract manufacturers as cost of sales, and administrative costs associated with the recall such as legal expenses as selling, general and administrative expenses. The Company recorded $0.4 million and $1.6 million for insurance recoveries in connection with the product recall in the three and nine months ended December 31, 2013, respectively. The impact of the recall-related charges and related insurance recoveries in the three and nine months ended December 31, 2013 and 2012 is as follows (in thousands except per share amount):

	Three Months Ended December 31,						Nine Months Ended December 31,
	2013			2012			2013			2012
Benefit to/(reduction of) net sales	$	104		$	(1,570	)	$	855		$	(1,570	)
Benefit to/(incremental) cost of sales	280			(690		)	533			(690		)
Benefit to/(incremental) selling, general and administrative expenses	(7		)	—			(18		)	—
Total benefit to/(reduction of) income before income taxes	$	377		$	(2,260	)	$	1,370		$	(2,260	)
Benefit to/(reduction of) net income	$	224		$	(1,346	)	$	827		$	(1,346	)
Benefit to/(reduction of) net income per diluted share	$	0.01		$	(0.08	)	$	0.05		$	(0.08	)

The Company does not expect any significant further additional costs associated with the voluntary product recall. The Company expects to receive additional recoveries from the involved insurance carriers in future quarters.