• Net profit up 5.9%
  • Operating profit climbs 2.6%
  • Net sales grow 13%

WhiteWave Foods has recorded an increase in full-year profit and said it expects continued momentum in 2013.

In the 12 months to the end of December, net profit climbed 5.9% to US$113.7m, the company reported today (13 February).

Operating profit was up 2.6% to $180.2m. Despite the increase, WhiteWave said the result was "softened somewhat" by "significant" year-over-year increases in marketing expenditures, and increases in distribution and warehousing costs due to capacity constraints as a result of the company's rapid volume growth.

Sales in the period grew 13% to $2.17bn, which was primarily volume driven and continues to be led by the company's North America plant-based foods and beverages and coffee creamer and beverages platforms, it said.

Show the press release

 

WhiteWave Foods Reports Strong Fourth Quarter and Full Year 2012 Results

  • Q4 2012 Pro Forma Adjusted Diluted Earnings per Share Increases 34% to $0.18; Full Year up 31% to $0.60
  • Full Year 2013 Guidance of Mid-Teens Pro Forma Adjusted Operating Income Growth
  • Full Year 2013 Guidance of $0.68 to $0.72 Pro Forma Adjusted Diluted Earnings per Share
  • Q1 2013 Guidance of $0.14 to $0.16 Pro Forma Adjusted Diluted Earnings per Share
  • Dean Foods Affirms Plans to Spin-Off The WhiteWave Foods Company in May 2013

 

DALLAS--(BUSINESS WIRE)--The WhiteWave Foods Company (the “Company”) (NYSE: WWAV) today reported strong results for the fourth quarter and full year ended December 31, 2012, driven by growth across all of the Company’s product categories.

“Further, we believe this higher spending level will enable us to accelerate certain high-return projects that will allow us to enhance our future operating margins.”

               
Financial Summary:    

Three Months Ended
December 31,

     

Full Year Ended
December 31,

In millions, except percentages and EPS     2012     2011     % Change       2012     2011     % Change
Total Net Sales                                      
GAAP     $608     $542     12%       $2,289     $2,026     13%
Pro Forma Adjusted     $609     $543     12%       $2,306     $2,044     13%
                                       
Operating Income                                      
GAAP     $46     $49     (6%)       $180     $176     3%
Pro Forma Adjusted     $48     $41     17%       $173     $142     22%
                                       
Income from Continuing Operations                                      
GAAP     $29     $31     (8%)       $113     $114     (2%)
Pro Forma Adjusted     $31     $23     34%       $104     $80     31%
                                       
Diluted Earnings per Share (EPS)                                      
GAAP     $0.17     $0.21     (16%)       $0.73     $0.76     (4%)
Pro Forma Adjusted     $0.18     $0.13     34%       $0.60     $0.46     31%
                                       
Diluted Shares Outstanding                                      
GAAP     165     150             154     150      
Pro Forma Adjusted     173     173             173     173      
                                       

The Company reported fourth quarter 2012 pro forma adjusted diluted earnings per share of $0.18, a 34 percent increase compared to fourth quarter 2011 pro forma adjusted diluted earnings of $0.13 per share. For full year 2012, the Company reported pro forma adjusted diluted earnings per share of $0.60, representing a 31 percent increase compared to full year 2011 pro forma adjusted diluted earnings per share of $0.46.

Pro forma adjusted net sales for the fourth quarter of 2012 increased 12 percent to $609 million, compared to $543 million in the fourth quarter of 2011. Pro forma adjusted net sales for the full year 2012 increased 13 percent to approximately $2.3 billion from $2.0 billion for the full year 2011. This growth has been primarily volume driven and continues to be led by the Company’s North America Plant-Based Foods & Beverages and Coffee Creamer & Beverages platforms.

Consolidated segment pro forma adjusted operating income for the fourth quarter of 2012 totaled $61 million, compared to $54 million in the fourth quarter of 2011, representing an increase of 13 percent. For the full year 2012, consolidated segment pro forma adjusted operating income increased 16 percent to $228 million, compared to full year 2011 consolidated segment pro forma adjusted operating income of $197 million. These segment operating results were softened somewhat by significant year over year increases in marketing expenditures, and increases in distribution and warehousing costs due to capacity constraints as a result of the Company’s rapid volume growth.

After pro forma corporate costs, the Company reported pro forma adjusted total operating income of $48 million for the fourth quarter of 2012, a 17 percent increase from $41 million in the fourth quarter of 2011. For the full year 2012, pro forma adjusted total operating income increased 22 percent to $173 million from $142 million for full year 2011.

“Our strong top and bottom line growth in the fourth quarter and throughout 2012 is a testament to the power of our leading brands and their positioning in the sweet spot of some of today’s fastest-growing product categories. We are at the heart of a broad and sustained movement towards nutritious, flavorful, convenient and responsibly produced food and beverages,” said Gregg Engles, Chairman and Chief Executive Officer. “Looking ahead to 2013, we are focused on growth and continuing to strengthen our brands, introduce new product offerings, expand our manufacturing capabilities, and drive cost savings across our business. We are confident that executing on these strategic initiatives – with the strong foundation we have in place – will ensure WhiteWave’s continued success and growth throughout the year and well into the future.”

NORTH AMERICA SEGMENT

The Company’s North America segment is comprised of Plant-based Foods and Beverages, Premium Dairy, and Coffee Creamers and Beverages categories. In the fourth quarter of 2012, pro forma adjusted net sales for the North America segment were $514 million, an increase of 13 percent over the fourth quarter 2011. For the full year 2012, pro forma adjusted net sales for the North America segment were $1.9 billion, an increase of 16 percent over full year 2011. Pro forma adjusted operating income for the North America segment increased 13 percent to $54 million for the fourth quarter, and 20 percent to $204 million for the full year 2012, compared to the same periods in 2011.

In the North America Plant-based Foods and Beverages platform, which includes Silk® Soymilk, Silk PureAlmond® and Silk PureCoconut®, pro forma adjusted net sales increased in the high-teens on a percentage basis in the fourth quarter of 2012 compared to the fourth quarter of 2011, driven primarily by continued strong growth of Silk PureAlmond®. For the full year 2012, pro forma adjusted net sales in this platform increased more than 20 percent, compared to 2011.

The overall Plant-based Foods and Beverages category remained strong with over 20 percent category growth for all of 2012, and WhiteWave’s Silk® brand continued to hold the #1 position. Building on the Silk® brand strength, the Company is also introducing Silk Iced Latte®, a non-dairy iced coffee option and Silk Fruity & Creamy® non-dairy yogurts, in addition to focusing on continued growth of core products.

In Premium Dairy, which includes Horizon Organic® branded dairy products, pro forma adjusted net sales increased in the mid-teens on a percentage basis in the fourth quarter of 2012 compared to the fourth quarter of 2011. While this platform benefited from a favorable comparison to the prior year period due to the lapping of supply constraints, the performance also reflects the strength of the underlying Horizon Organic® brand, as well as positive results from value-added offerings, such as Horizon Organic® single-serve and DHA Omega-3 products. For the full year 2012, pro forma adjusted net sales in Premium Dairy increased in the high-single digits on a percentage basis, compared to 2011.

The Company is expanding its Premium Dairy platform with the launch of new TruMoo® branded flavored milks in shelf-stable single-serve packaging that provides a convenient, healthy and affordable offering for families on the go. TruMoo®, a brand which the Company has licensed from Dean Foods, is a flavored milk line that is lower in sugar than traditional flavored milks and contains no high fructose corn syrup.

In Coffee Creamers and Beverages, which includes coffee creamers under the International Delight® and LAND O LAKES® brands as well as International Delight Iced Coffee®, pro forma adjusted net sales increased in the mid-teens on a percentage basis in the fourth quarter of 2012 compared to the fourth quarter of 2011. For full year 2012, pro forma adjusted net sales in this platform increased in the high-teens on a percentage basis compared to 2011.

The overall flavored creamer category, which continues to benefit from increased coffee consumption and related whitening trends, showed continued strength with approximately 12 percent growth in 2012. The Company plans to continue to build on its Coffee Creamers and Beverages platform with the planned expansion of its International Delight Iced Coffee® product line with a new “lights-line” with only 100 calories, as well as a single-serve four pack that will offer on-the-go convenience to this category.

EUROPE SEGMENT

The Company’s Europe segment is comprised of its European Plant-based Foods and Beverages platform which operates primarily under the Alpro® name. On a constant currency basis, net sales in the segment increased in the high-single digits on a percentage basis in the fourth quarter of 2012 compared to the fourth quarter of 2011. Net sales for this segment for full year 2012 increased on a constant currency basis in the mid-single digits on a percentage basis compared to 2011. Operating income for the segment increased 16 percent to $7 million for the fourth quarter of 2012 compared to the fourth quarter of 2011, as a result of volume growth and aided by foreign currency translation. For the full year 2012 operating income for the segment decreased 12 percent to $24 million compared to 2011, primarily driven by foreign currency translation. This platform delivered mid-single digit volume growth in the fourth quarter, driven by the strength of its core drinks, including Almond and Hazelnut beverages launched earlier in 2012, and its soy yogurt offerings. The Company plans to introduce several line extensions, including unsweetened and chocolate almond beverages, as well as an improved rice milk line in 2013.

OTHER ITEMS

Pro forma adjusted corporate costs totaled $13 million for the fourth quarter 2012 and $55 million for the full year 2012. Full year 2012 capital expenditures totaled $104 million, compared to $127 million for 2011.

FORWARD OUTLOOK

Building on its strong fourth quarter and full year 2012 results, the Company expects continued momentum in 2013. On a percentage basis, management anticipates pro forma adjusted net sales growth in the high-single digits for both first quarter and full year 2013. The Company anticipates that volume growth across its segments and platforms will be the primary driver of its top line growth, due to the continued growth of its existing products and augmented by a pipeline of new products it will be introducing to the marketplace in 2013.

The Company estimates approximately $55 million in pro forma stand-alone corporate cost in 2013, with approximately $16 million to $17 million occurring in the first quarter and approximately $13 million per quarter over the balance of the year.

As a result of anticipated higher distribution and warehousing costs due to capacity constraints over the first half of the year, the Company expects pro forma adjusted total operating income percentage growth to be in the high-single digits for the first quarter 2013, increasing to the mid-teens for the full year as production capacity is added and other cost reductions are implemented during the year.

Due to strong historical growth and volume growth forecasted, management anticipates a continued burden on internal production capacity, as well as its distribution and warehousing network and therefore, is increasing its estimate of annual capital expenditures to a range of $150 million to $160 million for 2013, from a prior estimate of approximately $125 million.

“We believe that this increase is necessary for us to continue to meet the demand of our growth categories, optimize our overall landed costs and enable us to maintain our high levels of customer service,” said Kelly Haecker, Chief Financial Officer. “Further, we believe this higher spending level will enable us to accelerate certain high-return projects that will allow us to enhance our future operating margins.”

Management anticipates annual interest expense to be approximately $20 million to $22 million, reflecting $60 million in recent debt reduction from proceeds received as part of Dean Foods’ divesture of its Morningstar business. The Company’s estimated tax rate for 2013 is approximately 33 percent.

The Company expects to deliver pro forma adjusted diluted earnings per share of between $0.68 and $0.72 for full year 2013. For the first quarter, management expects pro form adjusted diluted earnings of between $0.14 to $0.16 per share.

PLANNED SPIN-OFF BY DEAN FOODS IN MAY 2013

Dean Foods has affirmed its intention to effect a tax-free spin-off of shares of the Company in May, following the April 23, 2013 expiration of its IPO lock-up period. Dean Foods announced it has received a private letter ruling from the Internal Revenue Service providing that, subject to certain conditions, the anticipated spin-off will be tax-free for U.S. federal income tax purposes. Dean Foods also announced plans to retain up to 19.9% of the total outstanding WhiteWave shares, or up to 34.4 million shares, with the intention to monetize or distribute the position in a tax-free manner at a later date.

“We continue to develop the functions and capabilities necessary for us to operate as a stand-alone company and look forward to the planned separation from Dean Foods in May,” said Engles.

The spin-off or other disposition is subject to various conditions including approval by Dean Foods’ Board of Directors, the receipt of any necessary regulatory or other approvals, the maintenance of the private letter ruling from the Internal Revenue Service, and the existence of satisfactory market conditions. There can be no assurance as to when or whether the proposed spin-off or any other disposition will occur.

CONFERENCE CALL/WEBCAST

A webcast to discuss the Company’s financial results and outlook will be held on February 13, 2013, at 9:00AM ET and may be heard live by visiting the “Webcast” section of the Company’s website at http://www.thewhitewavefoodscompany.com/investor_relations. A slide presentation will accompany the webcast and a webcast replay will be available for approximately 45 days following the event within the Investor Relations section of the Company's website.

BASIS OF PRESENTATION AND NON-GAAP FINANCIAL MEASURES

The financial information in this release relates to certain periods prior to our initial public offering in October 2012 (the “IPO”) and the separation of our business from Dean Foods’ other businesses. Prior to the IPO, the Company had nominal assets and no liabilities, and had conducted no operations. In connection with the IPO, Dean Foods contributed the capital stock of its wholly owned subsidiary WWF Operating Company (“WWF Opco”) to the Company. WWF Opco, which is now a wholly owned subsidiary of the Company, held substantially all of the assets and liabilities related to the Company’s current business. Under U.S. generally accepted accounting principles, the contribution of WWF Opco to WhiteWave is treated as a reorganization of entities under common control under Dean Foods. As a result, we have retrospectively presented our unaudited pro forma adjusted condensed consolidated financial information of WhiteWave and WWF Opco for all periods presented.

The historical financial results in this release differ from the results of the WhiteWave-Alpro segment for the same periods previously reported by Dean Foods. A reconciliation between the results reported in this release and the WhiteWave-Alpro segment results reported by Dean Foods is included in the tables below.

In addition to the results prepared in accordance with U.S. generally accepted accounting principles (“GAAP”), we have presented certain non-GAAP financial measures, including pro forma adjusted net sales, pro forma adjusted income from continuing operations and pro forma adjusted diluted net income per share. These non-GAAP measures have been presented on a pro forma adjusted basis as if the Company had operated on an independent and stand-alone basis in all periods presented in order to facilitate meaningful evaluation of our operating performance between periods. These adjustments primarily relate to various commercial arrangements with Dean Foods in connection with the separation of the Company’s business from the rest of Dean Foods’ businesses, increased corporate costs to operate as a stand-alone public company, interest expense, completion of the IPO and the use of proceeds therefrom, non-recurring transaction costs related to the Company’s IPO and equity awards to certain of our executive officers, employees and directors. These adjustments are not necessarily indicative of our future performance and do not reflect what our actual financial performance would have been had we been a stand-alone public company during the periods presented. Further detail regarding these adjustments is included in the tables below.

ABOUT THE WHITEWAVE FOODS COMPANY

The WhiteWave Foods Company is a leading consumer packaged food and beverage company that manufactures, markets, distributes, and sells branded Plant-based Foods and Beverages, Coffee Creamers and Beverages, and Premium Dairy products throughout North America and Europe. The Company is focused on providing consumers with innovative, great-tasting food and beverage choices that meet their increasing desires for nutritious, flavorful, convenient, and responsibly produced products. The Company’s widely-recognized, leading brands distributed in North America include Silk® Plant-based Foods and Beverages, International Delight® and LAND O LAKES® Coffee Creamers and Beverages, and Horizon Organic® Premium Dairy products. Its popular European brands of Plant-based Foods and Beverages include Alpro® and Provamel®.

FORWARD-LOOKING STATEMENTS

Some of the statements in this press release are “forward-looking” and are made pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995. These “forward-looking” statements include statements relating to, among other things, projections of net sales growth, operating income, net income and earnings per share, as well as expected capital expenditures, interest expense, tax rate and corporate costs, growth of our business, expected financial performance and Dean Foods’ intention to effect a spin-off or other disposition of its ownership interest in us and the timing and form of such spin-off. These statements involve risks and uncertainties that may cause results to differ materially from the statements set forth in this press release. The Company’s ability to meet targeted financial and operating results, depends on a variety of economic, competitive and governmental factors, including raw material availability and costs, the demand for the Company’s products, and the Company’s ability to access capital under its credit facilities or otherwise, many of which are beyond the Company’s control and which are described in the Company’s filings with the Securities and Exchange Commission. The Company’s ability to profit from its branding initiatives depends on a number of factors, including consumer acceptance of the Company’s products. The Company cannot control the timing, manner and completion of the spin-off or other disposition by Dean Foods of its ownership interest in the Company, and any spin-off or other disposition by Dean Foods of its remaining ownership interest in the Company could be subject to various conditions, including the receipt by Dean Foods of any necessary regulatory or other approvals, satisfactory market conditions and in the case of a tax-free spin-off or other tax-free disposition, Dean Foods’ maintenance of the private letter ruling from the Internal Revenue Service and/or Dean Foods' receipt of an opinion of counsel. The forward-looking statements in this press release speak only as of the date of this release. The Company expressly disclaims any obligation or undertaking to release publicly any updates or revisions to such statements to reflect any change in its expectations with regard thereto or any changes in the events, conditions or circumstances on which any such statement is based.

 

Original source: Dean Foods