Nine-month earnings are $4.3 million, or $0.41 per share, on sales of $74.5 million compared to earnings of $3.0 million, or $0.31 per share, on sales of $70.5 million for the same nine-month period of 2000. The higher sales are due to increases in Sun-Rype's branded beverages and existing branded food business, supplemented by the introduction of the new-to-market Fruit & Veggie bar and increased co-pack sales.
"Most of the transformation of our beverage processing and packaging equipment took place in the third quarter," Bates says. "If you live in Western Canada, you should see the new 200 ml single serve and 1 litre reclosable slim packages on your supermarket shelves soon. Also, the production of the new Fruit & Veggie bar commenced in this quarter. In addition, we increased fruit snack production to a seven day, three-shift operation. All in all it was a busy quarter, especially for our manufacturing personnel."
The non-capital portion of these third quarter start-up costs is primarily responsible for the lower gross profit margins of this quarter compared to the first six months of 2001. The third quarter gross profit of 34.8% is, however, slightly higher than the third quarter of 2000. "We have enjoyed lower than normal commodity prices for some raw materials during the first nine months of 2001," says Bates. "Orange juice concentrate prices are returning to normal levels. While the 2001 apple crops in BC and Washington State are approximately 25% lower in volume than last year, world supplies of apple juice concentrate remain high."
Selling, general and administrative expenses are up $0.9 million over the same quarter last year, primarily as a result of higher marketing spending and sales costs associated with higher sales.
"We are looking forward to a positive consumer response to our Fruit & Veggie bar and our new family and single serve sized beverage packaging in the fourth quarter of this year," Bates says.
Sun-Rype Products Ltd., based in Kelowna, B.C., is a national manufacturer of apple-based food and beverage products. The company manufactures and markets a variety of juice and snack food products including the company's flagship Blue Label Apple Juice and Fruit to Go 100% all natural fruit snacks. Sun-Rype is a publicly traded company with its common shares listed on The Toronto Stock Exchange under the symbol SRF.
<< SUN-RYPE PRODUCTS LTD. Consolidated Interim Statements of Earnings and Retained Earnings (unaudited) (in thousands of dollars except per share amounts) ------------------------------------------------------------------------- ------------------------------------------------------------------------- For the three months For the nine months ended September 30 ended September 30 2001 2000 2001 2000 Net sales $ 24,195 $ 21,728 $ 74,504 70,534 Cost of sales 15,772 14,302 43,982 44,244 ------------------------------------------------------------------------ Gross profit 8,423 7,426 30,522 26,290 Selling, general and administrative expenses 6,400 5,503 21,508 18,760 Amortization 676 694 2,131 2,259 Interest expense 23 90 86 289 Other (118) - (185) (99) ------------------------------------------------------------------------ Earnings before income taxes 1,442 1,139 6,982 5,081 Income taxes 554 361 2,644 2,045 ------------------------------------------------------------------------ Net earnings 888 778 4,338 3,036 Retained earnings, beginning of period 8,877 2,833 5,427 575 ------------------------------------------------------------------------ Retained earnings, end of period $ 9,765 $ 3,611 $ 9,765 3,611 ------------------------------------------------------------------------ ------------------------------------------------------------------------ Earnings per share Basic $ 0.08 $ 0.08 $ 0.41 0.31 Fully diluted $ 0.08 $ 0.07 $ 0.40 0.29
