Keurig Green Mountain, Inc.
Nov 27, 2012
PDF
Add to Briefcase

Green Mountain Coffee Roasters, Inc. Reports Fourth Quarter and Fiscal Year 2012 Results

Fourth Quarter Fiscal 2012 Revenue Increases 33%, GAAP EPS Up 23%, Non-GAAP EPS Grows 36%;

Fiscal Year 2012 Revenue Increases 46%, GAAP EPS Up 74% and Non-GAAP EPS Grows 46%; Company Generates $77 million in Free Cash Flow for the Year

WATERBURY, Vt.--(BUSINESS WIRE)-- Green Mountain Coffee Roasters, Inc., (GMCR) (NASDAQ: GMCR), a leader in specialty coffee and coffee makers, today announced its fourth quarter and fiscal year results for the 14 and 53 weeks ended September 29, 2012.

 

Fourth Quarter & Fiscal Year 2012 Performance Highlights

 

($ in millions except
earnings per share)

       

Fourteen
weeks
ended
Sept. 29,
2012

   

Thirteen
weeks
ended
Sept. 24,
2011

    % Increase    

Fifty-three
weeks
ended
Sept. 29,
2012

   

Fifty-two
weeks
ended
Sept. 24,
2011

    % Increase
Net Sales $ 946.7     $ 711.9 33 %     $ 3,859.2     $ 2,650.9 46 %
Operating Income:
GAAP $ 143.7 $ 106.7 35 % $ 568.9 $ 368.9 54 %
Non-GAAP $ 157.1 $ 119.1 32 % $ 621.6 $ 428.7 45 %
Net Income:
GAAP $ 91.9 $ 75.4 22 % $ 362.6 $ 199.5 82 %
Non-GAAP $ 101.0 $ 75.3 34 % $ 381.6 $ 248.9 53 %
Diluted Income Per Share:
GAAP $ 0.58 $ 0.47 23 % $ 2.28 $ 1.31 74 %
Non-GAAP $ 0.64 $ 0.47 36 % $ 2.40 $ 1.64 46 %
EBITDA (*) $ 779.9 $ 472.5 65 %
 
Note: Complete GAAP to Non-GAAP reconciliation tables provided with this release.
(*) EBITDA is earnings before interest, taxes, depreciation, and amortization.
 

"Our fourth quarter fiscal year 2012 revenue and earnings growth speaks to GMCR's continued strategic progress and we believe points to the significant opportunity still ahead for the Company," said GMCR's President and CEO, Lawrence J. Blanford. "We continue to drive awareness of Keurig® single cup brewing and consumers continue to embrace and adopt Keurig® brewers and Keurig Brewed® beverages as an integral part of their daily routine."

During 2012, the Harris Poll 2012 EquiTrend® Study named Keurig® the coffee maker "Brand of the Year" and Green Mountain Coffee® the coffee "Brand of the Year." In addition, Landor Associates' annual Breakaway Brands Study, which identifies U.S. brands showing sustained brand-strength growth over a three-year period spanning 2008 through 2011, ranked the Keurig® brand second, with 79% growth in brand strength over the period.

"The innovative spirit that pervades the entire GMCR organization is nothing less than inspiring," continued Blanford. "In the span of less than ten months, our organization has introduced two new brewing platforms, the Keurig® Vue® brewer and in cooperation with our partner, Lavazza, the Keurig® Rivo™ Cappucino and Latte system. We also introduced a Vue® model for our away-from-home customers and multiple new beverages, including the very first varieties in our new Wellness Brewed™ collection."

"As we look to the future, we remain committed to bringing fresh ideas to light; pushing forward disruptive technologies; and capturing true innovation in products that delight consumers." Blanford concluded, "We also remain focused on driving sales and earnings in line with our longer term outlook and continuing to allocate capital wisely to balance profitability, cash flow and investment."

Please note that the Company's fiscal year 2012 included an additional week (53rd week). This unique calendar shift last occurred in fiscal year 2006 and is not scheduled to occur again until fiscal year 2017. The 53rd week added approximately $90.0 million in net sales; approximately $11.0 million (net of income taxes of $5.8 million) in net income; and, approximately $0.07 in diluted earnings per share in the fourth quarter and fiscal year 2012.

 

Fiscal Year 2012 Financial Review

Net Sales

        Fifty-three   Fifty-two      
Net Sales by Product weeks ended weeks ended
($ in millions) September 29, September 24, $ Increase % Increase
2012   2011 (Decrease)   (Decrease)
Single Serve Packs $ 2,708.9 $ 1,704.0 $ 1,004.9 59 %
Brewers and Accessories 759.8 524.7 235.1 45 %
Other Products and Royalties   390.5   422.2   (31.7 ) (8 )%
Total Net Sales $ 3,859.2 $ 2,650.9 $ 1,208.3   46 %
 

Operating Metrics

       

Change
FY 2011 to
FY 2012

 
Net price realization - single serve packs +260 bps
Higher manufacturing costs due to ramp up in manufacturing base -220 bps
Unfavorable green coffee costs -80 bps
Increase in obsolescence -70 bps
Vue®-related impact -50 bps
Lower warranty expense +40 bps

Balance Sheet & Cash Flow Highlights

"Stronger than expected fourth quarter fiscal year 2012 sales combined with ongoing inventory management efforts and lower-than-forecasted capital investment enabled us to generate free cash flow ahead of plan," said Frances G. Rathke, GMCR's Chief Financial Officer. "We expect to continue to strategically invest in the business as demand warrants, and continue to forecast free cash flow in a range of $100 million to $150 million for fiscal year 2013."

 

Balance Sheet & Cash Flow Highlights

($ in millions)         September 29,   September 24,    

$ Increase

 

% Increase

2012   2011  

(Decrease)

 

(Decrease)

Cash and cash equivalents $ 71.2 $ 40.5 $