Mike Valentine – CFO Jeff Sanfilippo – CEO

Ron Strauss – Pekin Singer Gregg Hillman – First Wilshire Michael Curran – Wachovia Securities Joe Christifano – Milwaukee David Leibowitz – Horizon Asset Management

Good day, ladies and gentlemen, and welcome to the John B. Sanfilippo & Son, fourth quarter and fiscal 2008 year end earnings conference call. My name is Fab, and I will be your coordinator for today. At this time all participants are in a listen-only mode. (Operator instructions) I would now like to turn the presentation over to your host for today call, Mr. Michael Valentine, CFO. Please proceed.

Thank you, Fab. First, on behalf of everyone here in JBSS we’d like to thank all of the participants for joining our quarterly conference call for the fourth quarter and fiscal year ended 2008. Before we start, we want to remind everyone that we may make some forward-looking statements today. These statements are based on our current expectations and involve certain risks and uncertainties. The factors that could negatively impact results are explained in the various filings that we have made the SEC, and we encourage everyone to refer to these filings to learn more about these risks and uncertainties. Starting with the income statement, the current quarter net sales increased by 1.9% to $2.3 million to $125.3 million in comparison to the net sales in the fourth quarter of fiscal 2007, total pounds shipped to customers decreased by 16.2%. There was decline in the shipment of pounds of almonds, macadamias, mixed nuts, peanuts and walnuts in the quarterly comparison. Pound shipped declined in all distribution channels except the food service channel. The increase in net sales was driven mainly by higher selling prices for almonds, cashews, fruit and nut mixes, mixed nuts, peanuts and walnuts in response to increasing acquisition cost for the commodities better in those products. Also a shift in sales mix from the industrial channel to the consumer and food service channels contributed to the increase in the overall weighted average selling price in the quarterly comparison. Fiscal year net sales increased slightly to $541.8 million from fiscal 2007 net sales of $540.9 million. Total pound shipped to customers decreased by 9.7% as was the case in the quarterly comparison there was a decline in the shipped of pounds of almonds, macadamias, mixed nuts, peanuts and walnuts in the yearly comparison. Pound shipped declined at all distribution channels except the food service in the channel in the yearly comparison also. The increase in net sales was driven mainly by higher selling prices for almonds, fruit and nut mixes, mixed nuts, peanuts and walnuts and response to increasing acquisition cost for those commodities. Additionally a shift in sales mix from the export industrial channels to sales in the consumer food service channels which typically have higher selling price contributed to the increase in the overall weighted average selling price in the early comparison. Fourth quarter gross profit margin increased to 14.6% from 8.5% for last year’s fourth quarter as a percentage of net sales. This significant improvement in gross margin was achieved despite the incurrence of $600,000 in cost associated with the equipment start up, equipment moved and redundant manufacturing activities occurred in the remaining facility in Elk Grove earlier in the fourth quarter. The gross profit margin increase in all distribution channels in comparison to the margins in those channels to last year’s fourth quarter. Gross profit margin improved on sales of all major product type, except cashews and peanuts because acquisition costs for these commodities increased at a greater rate than the rate of price increases that were implemented in the fourth quarter for those commodities. Fiscal 2008 gross profit margin as a percentage of net sales increased to 12.2% from 7.6% in the previous fiscal year. Gross profit margin for fiscal 2008 was impacted negatively as start up for new and moved equipment, redundant manufacturing cost and also equipment moving expenses which amounted to $12.3 million or approximately 2.3% of net sales. Gross profit margins improved in all distribution channels and sales of all major commodities except peanuts and cashews in the early comparison. Fourth quarter 2008 total selling and administrative expenses as a percentage of net sales decreased to 10.6% from 10.9% for the fourth quarter of fiscal 2007. Declines in consulting fees, distribution cost, brokerage, commissions and bank fees contributed largely to the decline in total selling administrative expenses as a percentage of net sales in the quarterly comparison. Fiscal 2008 total selling and administrative expenses as a percentage of net sales decreased to 9.9% from 10.3% for fiscal 2007. The decrease in total selling and administrative expenses in the early comparison was driven mainly from declines in distribution cost, advertising and brokerage commissions. Total operating expenses in fiscal 2008 included $1.8 million in restructuring cost while operating expenses in 2007 included a $3 million gain related to real estate sales that occurred that year. Primarily because of the 74.5% increase in gross profit in the quarterly comparison operating income for the fourth quarter increased from an operating loss of $2.9 million to an operating income of $5 million and primarily because of the 60.4% increase in gross profit on a year-over-year comparison. Operating income for fiscal 2008 improved from an operating loss of $11.1 million, fiscal 2007 to an operating income of $10.7 million in fiscal 2008. Interest expense in the current fourth quarter declined to $2.5 million from $3 million from the fourth quarter of fiscal 2007. The decline in interest expense in the quarterly comparison was driven mainly by lower short-term interest rates and by lower total debt levels. Interest expense in the current year increased to $10.5 million from $9.3 million from fiscal 2007. The unfavorable comparison in interest expense for fiscal year was mainly due to the fact of $900,000 of interest related to facility consolidation project was capitalized in fiscal 2007. Also higher short-term interest rates in the prior revolving credit facility contributed to the increase in interest expense earlier in the fiscal year. As a result of our refinancing of our revolving credit facility and notes the third quarter of the current fiscal year, fiscal 2008 operating results included debt extinguishment costs of $6.7 million. The debt extinguishment costs primarily were comprised of prepayment penalties. In summary, the loss before income taxes was at $6.9 million for fiscal 2008 included approximately $20.8 million, in unusual expenses related to the facility consolidation project, restructuring costs and debt extinguishment costs. Taking a quick look at inventory, total inventories at the end of fiscal 2008 declined by approximately $7.1 million or 5.3% compared to inventories on hand at the end of fiscal 2007. Pounds of raw nut input stocks declined by about 2.9 million pounds or about 6% in the early comparison. The value of finished goods on hand at the end of fiscal 2008 fell by 12% and the quantity of finished goods on hand fell by 13.6% when comparison to the value and quantity of finished goods on hand at the end of fiscal 2007. The decline in the value and quantity of inventories in fiscal 2008 cheaply came from improved inventory management and this improvement in inventory management helped in large part to generate approximately $29.6 million and net cash provided by operating activities in fiscal 2008. I’ll now turn the call over to Jeffrey Sanfilippo, CEO who is participating via telephone on this call and he will provide additional comments on the quarter and fiscal year. Jeff

Thank you, Mike. Good morning everyone and thank you for you’re your interest in John B. Sanfilippo & Son. We wrap up fiscal 2008 with a combination of several important initiatives executed and completed over the past year. The positive benefits of many of these initiatives were realized in our fourth quarter as we saw considerable improvement in profitability over the same period in the prior year and we expect this improvement to continue in fiscal 2009. To reiterate some key points that Mike had mentioned, the average net sales price per pound increased in all distribution channels as price increases were implemented in response to rising cost per commodities. The company was successful in its focus in installing more value added product lines and as a result we experienced a strategic shift in sales from the industrial and export channels to the consumer and food service channels. This also contributed to the increase in weighted average selling price. Fiscal 2008 gross profit margins as a percent of net sales increased from 7.6% in fiscal 2007 to 12.2% in fiscal 2008. It’s important to note that gross margins improved for all distribution channels when compared to the gross margins for those channels in fiscal 2007. This improvement came in large part from the completion of numerous initiatives that we implemented since the latter part of fiscal 2007. We achieved a great deal this past year and made difficult, but necessary decisions to drive value in our organization. The management team and our employees are focused on several key areas to accomplish this turnaround. First, operations; we completed our facility consolidation project and I’m happy to announce that final production lines that moved are now up and running in Elgin. The last piece of equipment, we relocated was our extreme neckline which makes sesame sticks, cheese balls and our hot panning equipment, which manufactures praline and butter toffee products. The machinery is now running in Elgin and we are producing excellent quality fissure extruded set of snacks to compliment our Fisher’s Snack Nut Co. program and Hot Pan Nuts to supplier consumer food service and industrial customers. Our procurement and materials purchasing department implemented further measures to reduce our material and packaged inventories. Their efforts were successful and lead to a 5.3% decrease in inventory at the end of fiscal 2008 compared to inventories at year end fiscal 2007. This we focused on our outside facilities as well and for example, improved our walnut selling operation to reduce net loss in our manufacturing processes in our Gustine, California facility. Sales and marketing departments; the company executed changes to our business model, which included optimizing our product portfolio, finalizing the route division migrations and realigning our sales force and selling strategies. The sales and marketing initiatives were factors in driving the company’s 74.5% gross margin improvement in the fourth quarter. In addition, initiatives allowed us to focus on value-added customer specific growth while transitioning out of low margin and low volume items. Our sales teams align the company with key customers to leverage our capabilities and product portfolio and to expand their dynamic nut programs. Our Human Resources Department worked hard to stabilize our workforce. As a result, the company improved and enhanced the selection process for employees. Also we have now been in Elgin over one year and employees are accommodated to the new facility and sophisticated products and lines. In the fourth quarter of fiscal 2008, our average weekly attrition rate in our Elgin facility declined by 62% in comparison to the average weekly attrition rate in the third quarter of fiscal 2008. We’ll continue to focus on improving manufacturing efficiencies through increased employee training. Our Finance Department successfully completed the refinancing of our short-term credit facility and long-term notes which delivered meaningful savings and interest expense, bank fees and legal fees during the fourth quarter of fiscal 2008. We also improved our credit closing process. The facility consolidation and equipment move to Elgin is completed, the profitability enhancement initiatives have been implemented and our refinancing is in place. Now our company’s focused in fiscal 2009 and going forward is on two key areas. First, improving manufacturing efficiencies in the Elgin facility; our operations departments are executing three important initiatives to accomplish those. First, reducing manufacturing spending through increased line efficiencies thereby optimizing indirect and direct labor headcount; second, increased efforts to reduce manufacturing spends and supplies and maintenance related costs, now that we’re fully moved into Elgin and third, reduced material scrap and overflow waste in the facilities. Turning to our growth initiative, which is the second key thing we are focused on, we are in position to reverse the decline in unit volume sold and will focus on pursuing profitable value-added growth. Our sales and marketing departments are more focused than ever on developing strong partnerships with key customers and have already been successful with two major retailers. They continue to have tools and resources necessary to provide value and build innovative nut programs for our key partners around the world. We are reinvesting in our Fisher Brand with both increased marketing funds and an increase in new product launches. For example, just this past year we launched our Fisher Culinary Touch program of Salad Toppings located in the Salad section of the grocery isle. In addition we pursued co-branding opportunities and were successful in co-branding our Fisher Brand with McDonald's granulated peanuts and we anticipate over 145 million unit of granulated peanuts will be shipped to McDonald’s over the coming year. Lastly sponsored the Pillsbury Bake-Off, where the winner of the $1 million award was a recipe that included Fisher Dry Roasted Peanuts for a Peanut Butter Cookie. Let me comment now on top line trends in the snack and baking categories and overall nut consumption trends as they relate to our current economy. According to IRI, consumer change has been faster, more frequent and less predictable than as any other time in recent history. This partnered with escalating prices has led to extreme price sensitivities and we’re witnessing changes in consumer behavior, such as eliminating or spending less on certain product categories, spending less on eating out, increasing the number of times consumers cook at home during the week, making fewer purchasing trips, opting to combine shopping trips in Erin and this has lead to a slight channel shift to supercenters to save on fuel and drugstore purchases to fill in the gap. Consumers are reaching for private label and value priced brands over their current national brands. They are increasing their coupon use and we see consumers increasing spend on meal preparation necessities, shifting away from pre-prepared meals and convenience to optic cook from scratch. It is reported that 53% of consumers are in fact cooking more from scratch versus six months ago. All of this combined with JBSS in a unique selling situation, we are positioned to leverage our private label brand strength with our national brand strength and channel strength of growth. Our unique channel diversification will allow us to utilize key insights from each channel such as food service and consumer and apply the relevant findings to maximize growth. For example focusing on our export market and global opportunities, we will be able to diversify and mitigate any potential declines we may see in domestic consumption during this downturn. I will close by saying we still have a lot of work to do and we will continue to execute strategies and initiatives to improve our financial performance and grow our business. We believe the plans we have in place are the right ones for our business and for our customers. There will continue to be challenges for our industry and our company with higher input costs for nuts, energy and packaging materials and a potential economic downturn in the United States. Although we believe that through the initiatives we are executing and through the hard work, commitment and effort of our employees we are well positioned for the future. Our focus now is on improving manufacturing efficiencies and growing value-added unit volume. Management has worked hard to create a value-driven culture within our company and we will continue to drive value for a customers, stakeholders and shareholders. We have strong momentum going forward and we appreciate your participation in the call and interest in our company. I will now the turn the call back over to Mike.

Okay, thanks Jeff. At this time we will open the call to questions. Fab, can you please queue up the first question.

Thank you. (Operator instructions) and your first question will come from the line of Ron Strauss from Pekin Singer; please proceed. Ron Strauss – Pekin Singer: Hello Mike and Jeff. It turns out that the light at the end of the tunnel is not an on-coming train.

Yes, I know that. Ron Strauss – Pekin Singer: I take my hat off to you guys for having gotten through this very difficult period in the last couple of years.

Thanks Ron.

Thank you. Ron Strauss – Pekin Singer: Did I hear you say Mike that you had almost $21 million of non-recurring charges to the P&L last year?

Yes, that’s the three items that we sited Ron, restructuring the redundant costs, moving that extinguishing costs, add up to about that number. Ron Strauss – Pekin Singer: So that’s about almost $2 a share by my calculations. Assuming here on ’09 recurring items here in fiscal ’09, will you be paying taxes at all in ’09 or is there a very substantial net operating loss carry forward that protects the cash flow?

Ron, we’re actually going to release the valuation allowance and the benefit that’s associated with that as we make profits. Probably shortly after the second quarter we’ll decide whether we’ll release the whole thing or not, but at this point in time I can’t tell you whether we’re going to end up with zero tax, left over benefit or expense. Ron Strauss – Pekin Singer: So, you don’t know the magnitude of your net operating losses, is that what you're saying?

No, we know the magnitude of the operating loss, but we are not going to predict profitability for ’09 on this call. Ron Strauss – Pekin Singer: I see. How big is that net operating loss to carry forward?

Approximately $4 million is the potential benefit. Ron Strauss – Pekin Singer: And what do you expect your capital expenditures will be in ’09?

As you can imagine, we’re planning on reducing capital expenditures pretty dramatically and going to what we characterize more as maintenance CapEx, which kind of ranges between $6 million to $8 million. Ron Strauss – Pekin Singer: And would you expect the depreciation to be somewhere around the magnitude of ’08?

It should be very close to the ’08 number. Ron Strauss – Pekin Singer: Something around $15 million or $16 million?

Right Ron Strauss – Pekin Singer: Okay, say your cash flow is going to be fairly substantial in ’09; how do you expect to allocate it, are you going to be paying down debt, buying back stock?

No, it will automatically go to pay down the revolver. Ron Strauss – Pekin Singer: And what would you say your capacity utilization is in you Elgin plant today?

Well, I mean due to the seasonality of our business if look that at it over the course of the year I would say we’re about 60%. Ron Strauss – Pekin Singer: And based on your plans for the next year, what would you expect that capacity utilization figure to look like, let’s say 12 months from now, give us some sort of ballpark number?

Ron, I think we’re probably going to look at a similar number, only because going forward we’re going to be faced with high cashew prices on the shelf, high peanut prices on the shelf and their impact on consumption is really going to determine what our utilization looks like at the end of the year. Ron Strauss – Pekin Singer: Could you talk about the crop outlook for your major ingredients?

Sure I will start with the ones that I do and then I will turn the rest over to Jeff or Jasper. Peanuts look very good; we’re probably looking at something that may possibly be a record crop, but certainly close to it, the weather conditions have been perfect throughout the growing season especially in the Southeast. The rain that they’ve received recently I am told has not damaged the crop at all and will probably actually help it to mature further. : Jeff, do you want to take some of the other tree nuts?

Sure, let me talk about pecans first. While this year will be the short crop in the traditional tree nut bearing cycle for pecans, it looks slightly more promising at this stage of the season and the typical short crops we’ve experienced in the past decade. There is a lot of carryover inventory, which will help offset the short crop, but what we’re seeing over this past year has a continued strong in-shell exports to China for pecans, which drove prices up this past year and if those continue or increase we could anticipate higher prices and otherwise might be expected coming into this short crop for pecans. Our walnuts; virtually everyone is expecting a record walnut crop that’s having nuts that’s combined with favorable weather conditions. It should result in the large crop with good quality. The only growing region looks like reporting disappointing result is the northern most area of California that was severely affected by late spring freeze, but in spite of record low carry in inventories, last year’s high prices has impacted consumption enough to what we feel keep things in relative balance so that supply pipeline can be refilled. Ron Strauss – Pekin Singer: Okay. Well, thank you very much gentlemen.

Okay, thanks Ron.

: Gregg Hillman – First Wilshire: Yes, good morning. Yes, I had two questions; one was I guess could you give me some concept of what do you think the payback period is for the expense that you’ve incurred in the move?

: Gregg Hillman – First Wilshire: Okay and then another question maybe for Jeff about the convenient stores, whether you could do like a private-label program for a convenient stores and do like a whole nut section for them and allow them to increase their margins for their snacks?

Yes, when we do have an initiative for convenience stores both for Fisher and we’re looking at a couple of private brands right now to develop convenient store programs that’s an opportunity. Gregg Hillman – First Wilshire: Could you increase your profitability over let’s say nuts that are carried by Frito or something like that?

The challenge is obviously Frito’s got such major distribution throughout the United States and is a very competitive player. I must say a typical retailer would produce or develop a product that doesn’t compete directly with Frito either on ounce weight or specific products that could be opportunities, but I would say going head-to-head with Frito on the shelf with the same item impact size would be a challenge. Gregg Hillman – First Wilshire: Okay and do have the capability to do like a nutritional bar or health bar something like (inaudible) or good health stuff in it?

We don’t actually have the capability of doing a bar format but we can do mixes that would include the same type of ingredients that you find in nutrition bars. Gregg Hillman – First Wilshire: Okay and then I guess you’ve addressed the pricing issue for all of the nuts earlier in the call. So I’ll get back in queue. Thank you.

Thank you.

Okay Greg.

Your next question will come from the line of Michael Curran from Wachovia Securities. Michael Curran – Wachovia Securities: Thanks gentlemen. Jeff, I’m in Savannah, Georgia and I can confirm, I checked with farmers in South Georgia, say the peanut crop is very healthy this year. That tropical storm that came through gave it great rain although we did knock down a few pecan trees. I have one basic question for you all. I assume steady revenues going forward in the mid 500 millions, but with the numerous manufacturing efficiencies you delineated etc, etc my question is does management have a gross margin goal and if so where are you shooting? I understand you finished this year at 12.2%.

Well, I’ll take that one Jeff. For those who are on the call, that haven’t been on our calls before the company does not give guidance. We do obviously have a gross margin goal and our goal is certainly to improve as we’ve talked about some of the initiatives we’re going to put in place, but we will not quantify that on this call. Michael Curran – Wachovia Securities: Okay. Thanks that was a tariff quarter. I didn’t think you could turn it around so quickly. Well done.

Okay, thank you.

Thank you Michael.

Your next question will comes form the line of Joe Christifano from Milwaukee. Joe Christifano – Milwaukee: Hi, good morning. Just a quick question on the old Panasonic building, any updates on being able to rent that?

Which building is that, the Panasonic building? Joe Christifano – Milwaukee: Yes.

Yes. Joe we currently have, as you can imagine there is not a whole of large tenants looking for space at this time. We’ve had fair interest with tenants that are looking between 10,000 to 15,000 square foot range but as of now we’ve not found any tenants to replace Panasonic. Joe Christifano – Milwaukee: Would you plan to just hold the building indefinitely until you find a tenant or at some point would you put the building up for sales?

No, we’ll continue to own it. Joe Christifano – Milwaukee: Okay, great that’s all I had. Thanks.

Thank you.

(Operator instructions) and you next question will come the line of David Leibowitz from Horizon Asset Management. David Leibowitz – Horizon Asset Management: Good morning.

Good morning. David Leibowitz – Horizon Asset Management: A few brief questions, if I may and I may not have taken it down correctly. What did you say the potential revenue from the McDonald's contract was?

The unit volume we anticipate is 145 million units of that small seven gram bag of granulated peanuts, but I would just add that it’s not new business for us, it’s just a co-branding opportunity, where before it was just a McDonald’s bag, now it’s a Fisher bag with McDonald’s co-branded. David Leibowitz – Horizon Asset Management: And is there any risk that you incur with this contract?

Risk as far as pricing or --? David Leibowitz – Horizon Asset Management: Inventory, pricing, returns.

No, this is something we worked with McDonald’s for over 10 years now on a product line for their salad toppings or their dessert toppings. So, we don’t anticipate any issues. It was a great opportunity for us to get some co-branding with the Fisher brand with McDonald’s. David Leibowitz – Horizon Asset Management: Second of all, what was the last time you instituted price increases?

The last time, well we’ve had commodity increases as Mike mentioned and I mentioned in the call, over the past year for commodities such as walnuts, peanuts and cashews. The most recent price increase we needed to implement were in cashews across all channels as a result of higher commodity costs. David Leibowitz – Horizon Asset Management: Are your price increases maintaining the normal profit margins you enjoy or have you seen that there’s a pushback in your pricing increases or not enough to include the historic profitability of the particular line or product.

It really depends on the nut type, David. Obviously, we are concerned with consumption dropping as a result of some of the dramatic price increases. I would say we will see some margin pressure as a result of what we have seen, especially for cashews price increases of cost increases, and that will bring everything on to consumers or customers. David Leibowitz – Horizon Asset Management: And as we look to the new fiscal year, which quarter would you consider the toughest one to match year-against-year quarter.

I will take that one, Jeff I would say that I would say that right now I would say probably none of the next four quarters would be difficult to match year-over-year simply because we have a pretty easy comparison to fiscal 2008. David Leibowitz – Horizon Asset Management: Okay and the last question, were you to get back onto historic trend line, do we show the profitability in the second half of this fiscal or does it actually have to wait another year.

To get back to normal profitability -- David Leibowitz – Horizon Asset Management: Correct.

That really is dependent on price increases on cashews, for the most part. Just to put that into perspective, cashew costs have risen by as much as 60% over the last 12 months as you can imagine, putting a 60% price increase on the shelves may not necessarily be in the best interest of a the category and really everybody in the industry so its going to be interesting how that dynamic plays out in that respect. David Leibowitz – Horizon Asset Management: Thank you very much.

Okay thank you

There are no further questions at this time. I would like to turn the call back over to Mr. Valentine for closing comments.

Again, as we state before we would like to thank everybody for their interest in JBSS, and this concludes the call for our fourth quarter and fiscal year 2008 operating results.

Thank you for your participation on today’s conference. This concludes the presentation. You may now disconnect. Have a great day.