Attached files
| file | filename |
|---|---|
| 8-K - FORM 8-K - KEURIG GREEN MOUNTAIN, INC. | d8k.htm |
| EX-99.2 - PREPARED REMARKS REGARDING SECOND QUARTER RESULTS - KEURIG GREEN MOUNTAIN, INC. | dex992.htm |
Exhibit 99.1
Contact Information:
Suzanne DuLong, VP IR & Corporate Comm
T: 802-882-2100
Investor.Services@GMCR.com
FOR IMMEDIATE RELEASE
Green Mountain Coffee Roasters, Inc. Reports Second Quarter Fiscal 2011 Results
Strong Consumer Adoption Powering Keurig Single-Cup Brewing System Sales
WATERBURY, VT (May 3, 2011) – Green Mountain Coffee Roasters, Inc., (NASDAQ: GMCR), a leader in specialty coffee and coffeemakers, today announced its fiscal 2011 second quarter results for the thirteen weeks ended March 26, 2011.
Second Quarter Fiscal 2011 Performance Highlights*
| • | Net sales up 101% over the same period in fiscal 2010 |
| • | GAAP EPS of $0.44; Non-GAAP EPS of $0.48 |
| • | GAAP operating income increases 198% over Q2’10; Non-GAAP operating income improves 178% over the year ago quarter |
| • | GAAP net income increases 172% over Q2’10; Non-GAAP net income up 147% over Q2’10 |
Second Quarter Fiscal 2011 Results*
Net sales for the second quarter of fiscal 2011 increased 101% to $647.7 million as compared to $322.0 million for the second quarter of fiscal 2010. Under Generally Accepted Accounting Principles (GAAP), net income for the second quarter of fiscal 2011 totaled $65.4 million, or $0.44 per diluted share, representing an increase of 172% as compared to GAAP net income of $24.1 million, or $0.17 per diluted share, for the second quarter of fiscal 2010.
The Company’s non-GAAP net income for the second quarter of fiscal 2011 increased 147% to $71.5 million, from non-GAAP net income of $28.9 million in the second quarter of fiscal 2010. Second quarter fiscal 2011 non-GAAP net income excludes pre-tax items of: $1.9 million in Van Houtte transaction-related expenses, $11.7 million in amortization of identifiable intangibles related to the Company’s acquisitions, $0.4 million in legal and accounting expenses related to the SEC inquiry and pending litigation, and a $3.0 million tax benefit related to the reversal of certain non-deductible acquisition-related expenses incurred in prior quarters which are now deemed deductible in accordance with recently enacted tax regulations. Second quarter fiscal 2010 non-GAAP net income excludes pre-tax items of: $4.8 million in transaction-related expenses for the Diedrich acquisition and $3.1 million in amortization of identifiable intangibles related to the Company’s prior acquisitions.
On the same basis of presentation, GMCR’s non-GAAP earnings per diluted share increased 131% to $0.48 in the second quarter of fiscal 2011 from $0.21 in the second quarter of fiscal 2010.
“We believe healthy post-holiday in-store brewer inventory levels and positive word of mouth from enthusiastic Keurig owners combined to help drive a very strong fiscal second quarter for GMCR,” said Lawrence J. Blanford, GMCR’s president and CEO.
The Keurig® Single-Cup Brewing system brews a perfect cup of coffee, tea, hot cocoa or iced beverage in under one minute at the touch of a button.
“We believe we are in the early stages of potential Keurig system adoption in North America and continue to work to scale our operations, processes and workforce to meet both the current and expected demands of the business,” said Blanford. “The addition of leading, nationally recognized brands like Dunkin’ Donuts, Starbucks and Swiss Miss to the Keurig Single-Cup Brewing system expands customer choice within the system, fuels new excitement by current Keurig owners and users, raises system awareness, and has the potential to attract new consumers to the system.”
Fiscal 2011 Second Quarter Financial Review*
| • | Approximately 82% of consolidated net sales in the second quarter were from the Keurig brewing system and its recurring K-Cup® portion pack sales, including Keurig-related accessory sales. |
| - | Net sales from K-Cup® portion packs totaled $411.8 million in the quarter, up 94%, or $199.1 million, over the same period in 2010. |
| - | In response to rising green coffee costs and increases in other input costs, in September 2010 the Company announced a price increase on all K-Cup® portion packs beginning on October 11, 2010. The price increase was fully implemented across all channels as of February 2011. In the second quarter of fiscal 2011, the price increase improved net sales by approximately 10.3% over what net sales would have been if calculated based on the pricing for K-Cup® portion packs in effect during the prior year period. |
| - | Net sales from Keurig brewers and accessories totaled $116.2 million in the quarter, up 86%, or $53.8 million, from the prior year period. |
| - | Supporting continued growth in K-Cup® demand, GMCR sold 1.2 million Keurig brewers during the second quarter of fiscal 2011. This brewer shipment number does not account for consumer returns to retailers. We estimate that GMCR brewer shipments represented approximately 91% of total brewers shipped with Keurig technology in the period. |
| - | The acquisition of Van Houtte completed on December 17, 2010 contributed $100.5 million to consolidated net sales, after eliminating the effect on consolidated net sales of K-Cup® portion pack sales to Keurig by Van Houtte and royalties recorded by Keurig from Van Houtte. |
| • | Second quarter fiscal 2011 gross margin was 37.5% of total net sales compared to 33.5% for the corresponding quarter in fiscal 2010. |
| • | The Company increased its GAAP operating income by 198%, to $119.6 million, in the second quarter of fiscal 2011 as compared to $40.1 million in the year ago quarter. |
| • | GMCR’s second quarter fiscal 2011 non-GAAP operating income of $133.6 million increased 178% over non-GAAP operating income of $48.0 million in the second quarter of fiscal 2010. Non-GAAP operating income represented 20.6% of net sales in the second quarter of fiscal 2011 and 14.9% of net sales in the second quarter of fiscal 2010. |
| • | The Company’s tax rate for the second quarter of fiscal 2011 was 35.5% as compared to 38.6% in the prior year quarter reflecting a lower corporate income tax rate in Canada from the Van Houtte acquisition and due to the recent Internal Revenue Service Revenue Procedure 2011-29 which allows taxpayers to deduct 70% of the previously non-deductible success-based fees incurred in connection with certain acquisitions. |
| • | Diluted weighted average shares outstanding increased 7% to 147.6 million in the second quarter of fiscal 2011 from 137.8 million in the second quarter of fiscal 2010 primarily due to the issuance of 8.6 million shares of common stock to Luigi Lavazza S.p.A in a private placement on September 28, 2010. |
Balance Sheet Highlights
| • | Cash and short-term cash investments were $64.5 million at March 26, 2011, up from $62.9 million at December 25, 2010. |
| • | Accounts receivable increased 77% year-over-year to $226.8 million at March 26, 2011, from $128.2 million at March 27, 2010, reflecting continuing sales growth. |
| • | Inventories were $300.8 million at March 26, 2011 including $29.5 million of Van Houtte-related inventories. This compares to $262.5 million at September 25, 2010. |
| • | Debt outstanding increased to $1.060 billion at March 26, 2011 from $354.5 million at September 25, 2010 primarily as a result of the Company’s acquisition of Van Houtte on December 17, 2010. |
| • | The Company is pursuing a sale of the Filterfresh U.S.-based coffee services business portion of its Van Houtte acquisition, which is classified as “assets available for sale” in the Company’s financial statements, and expects to use any proceeds from an ultimate sale to reduce debt. |
Business Outlook and Other Forward-Looking Information*
Company Estimates for Fiscal Year 2011
The Company provided the following revised estimates for its fiscal year 2011.
| • | Total consolidated net sales growth of 82% to 87%, up from previous net sales growth guidance of 75% to 80%. |
| • | The Company increased its 2011 non-GAAP earnings per diluted share range to $1.43 to $1.50 per diluted share from $1.19 to $1.29 per share, excluding any acquisition-related transaction expenses; legal and accounting expenses related to the SEC inquiry, the Company’s internal investigation and pending litigation; amortization of identifiable intangibles related to the Company’s acquisitions; deferred financing costs; and, foreign exchange impact of hedging the risk associated with the Canadian dollar purchase price of the Van Houtte acquisition. |
| • | Capital expenditures for fiscal 2011 in the range of $275 million to $305 million, up from previous capital expenditure guidance of $245 million to $290 million. |
Company Estimates for Third Quarter Fiscal Year 2011
The Company also provided its first estimates for its third quarter of fiscal 2011:
| • | Total consolidated net sales growth of 90% to 95%. |
| • | Non-GAAP earnings per share in the range of $0.34 to $0.38 per diluted share excluding any acquisition-related transaction expenses; legal and accounting expenses related to the SEC inquiry, the Company’s internal investigation and pending litigation; deferred financing costs; and, amortization of identifiable intangibles related to the Company’s acquisitions. |
*All comparisons to prior periods reflect restated financial results for those periods as reported in Annual Report on Form 10-K filed December 9, 2010. A complete reconciliation of the Company’s GAAP to non-GAAP results is provided with this announcement.
Use of Non-GAAP Financial Measures
In addition to reporting financial results in accordance with generally accepted accounting principles (GAAP), the Company provides non-GAAP operating results that exclude certain charges or credits such as acquisition-related transaction expenses, legal and accounting-related expenses associated with the SEC inquiry, the Company’s internal investigation and pending litigation, foreign exchange impact of hedging the risk associated with the Canadian dollar purchase price of the Van Houtte acquisition, and non-cash related items such as amortization of identifiable intangibles, each of which include adjustments to show the tax impact of excluding these items. These amounts are not in accordance with, or an alternative to, GAAP. The Company’s management believes that these measures provide investors with transparency by helping illustrate the underlying financial and business trends relating to the Company’s results of operations and financial condition and comparability between current and prior periods. Management uses the measures to establish and monitor budgets and operational goals and to evaluate the performance of the Company. Please see the “GAAP to Non-GAAP Reconciliation of Unaudited Consolidated Statements of Operations” tables that accompany this press release for a full reconciliation the Company’s GAAP to non-GAAP results.
Conference Call and Webcast
Green Mountain Coffee Roasters, Inc. will be discussing these financial results with analysts and investors in a conference call and live webcast available via the Internet at 5:00 p.m. ET today, May 3, 2011. Management’s prepared remarks on its quarterly results will be provided via a Current Report on Form 8-K and also posted under the events link in the Investor Relations section of the Company’s website at www.GMCR.com. As a result, the conference call will include only brief remarks by management followed by a question and answer session. The call along with accompanying slides is accessible, via live webcast from the events link in the Investor Relations portion of the Company’s website at http://investor.gmcr.com/events.cfm. The Company archives the latest conference call for a period of time. A replay of the conference call also will be available by telephone at (719) 457-0820, Passcode 6217671 from 9:00 p.m. ET on May 3, 2011 through 9:00 PM ET on Sunday, May 8, 2011.
About Green Mountain Coffee Roasters, Inc.
As a leader in specialty coffee and coffee makers, Green Mountain Coffee Roasters, Inc. (NASDAQ: GMCR), is recognized for its award-winning coffees, innovative Keurig Single-Cup brewing technology, and socially responsible business practices. GMCR supports local and global communities by offsetting 100% of its direct greenhouse gas emissions, investing in sustainably-grown coffee, and donating at least five percent of its pre-tax profits to social and environmental projects.
GMCR routinely posts information that may be of importance to investors in the Investor Relations section of its website, including news releases and its complete financial statements, as filed with the SEC. The Company encourages investors to consult this section of its website regularly for important information and
news. Additionally, by subscribing to the Company’s automatic email news release delivery, individuals can receive news directly from GMCR as it is released.
Forward-Looking Statements
Certain statements contained herein are not based on historical fact and are “forward-looking statements” within the meaning of the applicable securities laws and regulations. Generally, these statements can be identified by the use of words such as “anticipate,” “believe,” “could,” “estimate,” “expect,” “feel,” “forecast,” “intend,” “may,” “plan,” “potential,” “project,” “should,” “would,” and similar expressions intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. Owing to the uncertainties inherent in forward-looking statements, actual results could differ materially from those stated here. Factors that could cause actual results to differ materially from those in the forward-looking statements include, but are not limited to, the impact on sales and profitability of consumer sentiment in this difficult economic environment, the Company’s success in efficiently expanding operations and capacity to meet growth, the Company’s success in efficiently and effectively integrating the Company’s acquisitions, the Company’s success in introducing and producing new product offerings, the ability of lenders to honor their commitments under the Company’s credit facility, competition and other business conditions in the coffee industry and food industry in general, fluctuations in availability and cost of high-quality green coffee, any other increases in costs including fuel, Keurig’s ability to continue to grow and build profits with its roaster partners in the At Home and Away from Home businesses, the Company experiencing product liability, product recall and higher than anticipated rates of warranty expense or sales returns associated with a product quality or safety issue, the impact of the loss of major customers for the Company or reduction in the volume of purchases by major customers, delays in the timing of adding new locations with existing customers, the Company’s level of success in continuing to attract new customers, sales mix variances, weather and special or unusual events, the impact of the inquiry initiated by the SEC and any related litigation or additional governmental investigative or enforcement proceedings, as well as other risks described more fully in the Company’s filings with the SEC. Forward-looking statements reflect management’s analysis as of the date of this release. The Company does not undertake to revise these statements to reflect subsequent developments, other than in its regular, quarterly earnings releases.
GREEN MOUNTAIN COFFEE ROASTERS, INC.
Unaudited Consolidated Statements of Operations
(Dollars in thousands except per share data)
| Thirteen weeks ended March 26, 2011 |
Thirteen weeks ended March 27, 2010 (As Restated) |
|||||||
| Net sales |
$ | 647,658 | $ | 321,953 | ||||
| Cost of sales |
404,803 | 214,103 | ||||||
| Gross profit |
242,855 | 107,850 | ||||||
| Selling and operating expenses |
79,745 | 43,251 | ||||||
| General and administrative expenses |
43,499 | 24,464 | ||||||
| Operating income |
119,611 | 40,135 | ||||||
| Other income (expense) |
1,078 | (133 | ) | |||||
| Loss on financial instruments, net |
(5,959 | ) | — | |||||
| Gain on foreign currency, net |
4,045 | — | ||||||
| Interest expense |
(16,672 | ) | (833 | ) | ||||
| Income before income taxes |
102,103 | 39,169 | ||||||
| Income tax expense |
(36,295 | ) | (15,114 | ) | ||||
| Net Income |
65,808 | 24,055 | ||||||
| Less: Net income attributable to noncontrolling interests |
436 | — | ||||||
| Net income attributable to GMCR |
$ | 65,372 | $ | 24,055 | ||||
| Basic income per share: |
||||||||
| Basic weighted average shares outstanding |
141,784,994 | 131,263,638 | ||||||
| Net income |
$ | 0.46 | $ | 0.18 | ||||
| Diluted income per share: |
||||||||
| Diluted weighted average shares outstanding |
147,558,595 | 137,831,574 | ||||||
| Net income |
$ | 0.44 | $ | 0.17 | ||||
GREEN MOUNTAIN COFFEE ROASTERS, INC.
Unaudited Consolidated Statements of Operations
(Dollars in thousands except per share data)
| Twenty-six weeks ended March 26, 2011 |
Twenty-six weeks ended March 27, 2010 (As Restated) |
|||||||
| Net sales |
$ | 1,221,806 | $ | 667,105 | ||||
| Cost of sales |
835,351 | 463,678 | ||||||
| Gross profit |
386,455 | 203,427 | ||||||
| Selling and operating expenses |
158,034 | 96,626 | ||||||
| General and administrative expenses |
85,530 | 47,636 | ||||||
| Operating income |
142,891 | 59,165 | ||||||
| Other income (expense) |
1,166 | 110 | ||||||
| Loss on financial instruments, net |
(12,301 | ) | (354 | ) | ||||
| Gain on foreign currency, net |
5,624 | — | ||||||
| Interest expense |
(22,730 | ) | (1,881 | ) | ||||
| Income before income taxes |
114,650 | 57,040 | ||||||
| Income tax expense |
(46,393 | ) | (22,925 | ) | ||||
| Net Income |
68,257 | 34,115 | ||||||
| Less: Net income attributable to noncontrolling interests |
473 | — | ||||||
| Net income attributable to GMCR |
$ | 67,784 | $ | 34,115 | ||||
| Basic income per share: |
||||||||
| Basic weighted average shares outstanding |
141,579,543 | 131,116,251 | ||||||
| Net income |
$ | 0.48 | $ | 0.26 | ||||
| Diluted income per share: |
||||||||
| Diluted weighted average shares outstanding |
147,310,364 | 137,628,396 | ||||||
| Net income |
$ | 0.46 | $ | 0.25 | ||||
GREEN MOUNTAIN COFFEE ROASTERS, INC.
Unaudited Consolidated Balance Sheets
(Dollars in thousands)
| March 26, 2011 |
September 25, 2010 |
|||||||
| Assets |
||||||||
| Current assets: |
||||||||
| Cash and cash equivalents |
$ | 33,737 | $ | 4,401 | ||||
| Restricted cash and cash equivalents |
30,765 | 355 | ||||||
| Receivables, less uncollectible accounts and return allowances of $20,565 and $14,056 at March 26, 2011 and September 25, 2010, respectively |
226,773 | 172,200 | ||||||
| Inventories |
300,760 | 262,478 | ||||||
| Income taxes receivable |
10,526 | 5,350 | ||||||
| Other current assets |
32,407 | 23,488 | ||||||
| Current deferred income taxes, net |
23,713 | 26,997 | ||||||
| Current assets held for sale |
27,229 | — | ||||||
| Total current assets |
685,910 | 495,269 | ||||||
| Fixed assets, net |
429,595 | 258,923 | ||||||
| Intangibles, net |
569,016 | 220,005 | ||||||
| Goodwill |
808,881 | 386,416 | ||||||
| Other long-term assets |
58,914 | 9,961 | ||||||
| Long-term assets held for sale |
117,444 | — | ||||||
| Total assets |
$ | 2,669,760 | $ | 1,370,574 | ||||
| Liabilities and Stockholders’ Equity |
||||||||
| Current liabilities: |
||||||||
| Current portion of long-term debt |
$ | 11,328 | $ | 19,009 | ||||
| Accounts payable |
154,697 | 139,220 | ||||||
| Accrued compensation costs |
31,899 | 24,236 | ||||||
| Accrued expenses |
72,837 | 49,279 | ||||||
| Income tax payable |
3,088 | 1,934 | ||||||
| Other short-term liabilities |
36,876 | 4,377 | ||||||
| Current liabilities related to assets held for sale |
19,786 | — | ||||||
| Total current liabilities |
330,511 | 238,055 | ||||||
| Long-term debt |
1,048,399 | 335,504 | ||||||
| Long-term deferred income taxes, net |
195,952 | 92,579 | ||||||
| Other long-term liabilities |
27,651 | 5,191 | ||||||
| Long-term liabilities related to assets held for sale |
1,378 | — | ||||||
| Commitments and contingencies |
||||||||
| Redeemable noncontrolling interests |
20,220 | — | ||||||
| Stockholders’ equity: |
||||||||
| Preferred stock, $0.10 par value: Authorized - 1,000,000 shares; |
||||||||
| No shares issued or outstanding |
— | — | ||||||
| Common stock, $0.10 par value: Authorized - 200,000,000 shares; |
||||||||
| Issued - 141,999,856 and 132,823,585 shares at March 26, 2011 and September 25, 2010, respectively |
14,200 | 13,282 | ||||||
| Additional paid-in capital |
737,616 | 473,749 | ||||||
| Retained earnings |
280,934 | 213,844 | ||||||
| Accumulated other comprehensive income (loss) |
12,899 | (1,630 | ) | |||||
| Total stockholders’ equity |
1,045,649 | 699,245 | ||||||
| Total liabilities and stockholders’ equity |
$ | 2,669,760 | $ | 1,370,574 | ||||
GREEN MOUNTAIN COFFEE ROASTERS, INC.
Unaudited Consolidated Statements of Cash Flows
(Dollars in thousands)
| Twenty-six weeks ended March 26, 2011 |
Twenty-six weeks ended March 27, 2010 (As Restated) |
|||||||
| Cash flows from operating activities: |
||||||||
| Net income |
$ | 68,257 | $ | 34,115 | ||||
| Adjustments to reconcile net income to net cash provided by operating activities: |
||||||||
| Depreciation |
30,991 | 12,667 | ||||||
| Amortization of intangibles |
17,793 | 5,204 | ||||||
| Amortization of deferred financing fees |
5,175 | — | ||||||
| Gain on foreign currency exchange transactions |
(5,624 | ) | — | |||||
| (Gain) loss on disposal of fixed assets |
(75 | ) | 451 | |||||
| Bad debts |
400 | 342 | ||||||
| Sales returns |
5,262 | 3,334 | ||||||
| Loss (gain) on financial instruments, net |
12,281 | (112 | ) | |||||
| Tax benefit from exercise of non-qualified options and disqualified dispositions of incentive stock options |
6 | 22 | ||||||
| Excess tax benefits from equity-based compensation plans |
(5,839 | ) | (4,492 | ) | ||||
| Deferred income taxes |
2,862 | (2,444 | ) | |||||
| Deferred compensation and stock compensation |
4,633 | 3,926 | ||||||
| Changes in assets and liabilities, net of effects of acquisition: |
||||||||
| Receivables |
(11,197 | ) | (31,583 | ) | ||||
| Inventories |
(889 | ) | 38,016 | |||||
| Income tax receivable (payable), net |
2,562 | (6,758 | ) | |||||
| Other current assets |
(9,538 | ) | (7,935 | ) | ||||
| Other long-term assets, net |
(11,300 | ) | 102 | |||||
| Accounts payable |
8,987 | 6,547 | ||||||
| Accrued compensation costs |
(8,487 | ) | (1,151 | ) | ||||
| Accrued expenses |
8,129 | 15,043 | ||||||
| Other short-term liabilities |
(529 | ) | — | |||||
| Other long-term liabilities |
11,401 | — | ||||||
| Net cash provided by operating activities |
125,261 | 65,294 | ||||||
| Cash flows from investing activities: |
||||||||
| Change in restricted cash |
150 | 210 | ||||||
| Proceeds from sale of short-term investments |
— | 50,000 | ||||||
| Proceeds from notes receivable |
103 | — | ||||||
| Acquisition of Timothy’s Coffee of the World Inc. |
— | (154,208 | ) | |||||
| Advance on acquisition of Diedrich Coffee, Inc., net of cash acquired |
— | (8,500 | ) | |||||
| Acquisition of LJVH Holdings, Inc. (Van Houtte), net of cash acquired |
(907,835 | ) | — | |||||
| Capital expenditures for fixed assets |
(99,040 | ) | (53,175 | ) | ||||
| Proceeds from disposal of fixed assets |
280 | 183 | ||||||
| Other investing activities |
(158 | ) | — | |||||
| Net cash used in investing activities |
(1,006,500 | ) | (165,490 | ) | ||||
| Cash flows from financing activities: |
||||||||
| Net change in revolving line of credit |
257,923 | (3,000 | ) | |||||
| Proceeds from issuance of common stock under compensation plans |
4,784 | 3,553 | ||||||
| Proceeds from issuance of common stock |
249,524 | — | ||||||
| Dividends paid to redeemable noncontrolling interests shareholders |
(386 | ) | — | |||||
| Excess tax benefits from equity-based compensation plans |
5,838 | 4,492 | ||||||
| Capital lease obligations |
(5 | ) | (25 | ) | ||||
| Proceeds from borrowings of long-term debt |
794,500 | — | ||||||
| Deferred financing fees |
(41,628 | ) | — | |||||
| Repayment of long-term debt |
(354,773 | ) | (2,500 | ) | ||||
| Net cash provided by financing activities |
915,777 | 2,520 | ||||||
| Change in cash balances included in short-term assets held for sale |
(6,510 | ) | — | |||||
| Effect of exchange rate changes on cash and cash equivalents |
1,308 | — | ||||||
| Net (decrease) increase in cash and cash equivalents |
29,336 | (97,676 | ) | |||||
| Cash and cash equivalents at beginning of period |
4,401 | 241,811 | ||||||
| Cash and cash equivalents at end of period |
$ | 33,737 | $ | 144,135 | ||||
| Supplemental disclosures of cash flow information: |
||||||||
| Fixed asset purchases included in accounts payable and not disbursed at the end of each year |
$ | 11,051 | $ | 8,870 | ||||
| Noncash investing activity: |
||||||||
| Liabilities assumed in conjunction with acquisitions |
$ | — | $ | 1,533 | ||||
GREEN MOUNTAIN COFFEE ROASTERS, INC.
GAAP to Non-GAAP Reconciliation of Unaudited Consolidated Statements of Operations
(Dollars in thousands)
| Thirteen weeks ended March 26, 2011 |
Thirteen weeks ended March 27, 2010 |
|||||||
| Operating income |
$ | 119,611 | $ | 40,135 | ||||
| Acquisition-related expenses (1) |
1,905 | 4,839 | ||||||
| SEC inquiry (2) |
405 | — | ||||||
| Amortization of identifiable intangibles (3) |
11,658 | 3,061 | ||||||
| Non-GAAP operating income |
$ | 133,579 | $ | 48,035 | ||||
| Thirteen weeks ended March 26, 2011 |
Thirteen weeks ended March 27, 2010 |
|||||||
| Net income |
$ | 65,372 | $ | 24,055 | ||||
| After tax: |
||||||||
| Acquisition-related expenses (4) |
(1,858 | ) | 2,886 | |||||
| SEC inquiry (2) |
249 | — | ||||||
| Amortization of identifiable intangibles (3) |
7,763 | 1,998 | ||||||
| Non-GAAP net income |
$ | 71,526 | $ | 28,939 | ||||
| Thirteen weeks ended March 26, 2011 |
Thirteen weeks ended March 27, 2010 |
|||||||
| Diluted income per share |
$ | 0.44 | $ | 0.17 | ||||
| After tax: |
||||||||
| Acquisition-related expenses (4) |
$ | (0.01 | ) | $ | 0.02 | |||
| SEC inquiry (2) |
$ | 0.00 | $ | — | ||||
| Amortization of identifiable intangibles (3) |
$ | 0.05 | $ | 0.01 | ||||
| Non-GAAP net income per share |
$ | 0.48 | $ | 0.21 | * | |||
|
* Does not add due to rounding. |
||||||||
| (1) | Represents direct acquisition-related expenses of $1.9 million ($1.2 million after-tax) and $4.8 million ($2.9 million after-tax) for the second quarter of fiscal 2011 and fiscal 2010, respectively. |
| (2) | Represents legal and accounting expenses, net of tax, related to the SEC inquiry and pending litigation classified as general and administrative. |
| (3) | Represents the amortization of intangibles, net of tax, related to the Company’s acquisitions classified as general and administrative expense. |
| (4) | Represents direct acquisition-related expenses of $1.9 million ($1.2 million after-tax) and $4.8 million ($2.9 million after-tax) for the second quarter of fiscal 2011 and fiscal 2010, respectively. In the second quarter of fiscal 2011, the Company recognized a tax benefit of $3.0 million related to the reversal of certain nondeductible acquisition-related expenses incurred during the Company’s fourth quarter of fiscal 2010 and the first quarter of fiscal 2011 that are now deemed deductible in accordance with recently enacted tax regulations. This tax benefit was reversed for purposes of this non-GAAP table. |
GREEN MOUNTAIN COFFEE ROASTERS, INC.
GAAP to Non-GAAP Reconciliation of Unaudited Consolidated Statements of Operations
(Dollars in thousands)
| Twenty-six weeks ended March 26, 2011 |
Twenty-six weeks ended March 27, 2010 |
|||||||
| Operating income |
$ | 142,891 | $ | 59,165 | ||||
| Acquisition-related expenses (1) |
10,573 | 9,897 | ||||||
| SEC inquiry (2) |
6,394 | — | ||||||
| Amortization of identifiable intangibles (3) |
17,793 | 5,204 | ||||||
| Non-GAAP operating income |
$ | 177,651 | $ | 74,266 | ||||
| Twenty-six weeks ended March 26, 2011 |
Twenty-six weeks ended March 27, 2010 |
|||||||
| Net income |
$ | 67,784 | $ | 34,115 | ||||
| After tax: |
||||||||
| Acquisition-related expenses (4) |
14,524 | 6,681 | ||||||
| SEC inquiry (2) |
3,929 | — | ||||||
| Amortization of identifiable intangibles (3) |
11,655 | 3,361 | ||||||
| Non-GAAP net income |
$ | 97,892 | $ | 44,157 | ||||
| Twenty-six weeks ended March 26, 2011 |
Twenty-six weeks ended March 27, 2010 |
|||||||
| Diluted income per share |
$ | 0.46 | $ | 0.25 | ||||
| After tax: |
||||||||
| Acquisition-related expenses (4) |
$ | 0.10 | $ | 0.05 | ||||
| SEC inquiry (2) |
$ | 0.03 | $ | — | ||||
| Amortization of identifiable intangibles (3) |
$ | 0.08 | $ | 0.02 | ||||
| Non-GAAP net income per share |
$ | 0.66 | * | $ | 0.32 | |||
|
* Does not add due to rounding. |
||||||||
| (1) | Represents direct acquisition-related expenses of $10.6 million ($9.8 million after-tax) and $9.9 million ($6.7 million after-tax) for the 2011 YTD period and the prior YTD period, respectively; and for the 2011 YTD period, the write-off of deferred financing expenses as part of the new debt financing of $2.6 million ($1.6 million after-tax) and the foreign exchange impact of hedging the risk associated with the Canadian dollar purchase price of the Van Houtte acquisition of $5.3 million ($4.0 million after-tax). |
| (2) | Represents legal and accounting expenses related to the SEC inquiry, the Company’s internal investigation and pending litigation classified as general and administrative. |
| (3) | Represents the amortization of intangibles related to the Company’s acquisitions classified as general and administrative expense. |
| (4) | Represents direct acquisition-related expenses of $10.6 million ($9.8 million after-tax) and $9.9 million ($6.7 million after-tax) for the 2011 YTD period and the prior YTD period, respectively; and for the 2011 YTD period, the write-off of deferred financing expenses as part of the new debt financing of $2.6 million ($1.6 million after-tax) and the foreign exchange impact of hedging the risk associated with the Canadian dollar purchase price of the Van Houtte acquisition of $5.3 million ($4.0 million after-tax). In the 2011 YTD period, the Company recognized a $2.1 million tax expense related to the reversal of nondeductible acquisition-related expenses incurred during the Company’s fourth quarter of fiscal 2010 and a $3.0 million tax benefit related to the reversal of certain nondeductible acquisition-related expenses incurred during the Company’s fourth quarter of fiscal 2010 and the first quarter of fiscal 2011 that are now deemed deductible in accordance with recently enacted tax regulations. This combined tax affect was reversed for purposes of this non-GAAP table. |