WhiteWave cited "strong" organic growth in Europe, where it sells the Alpro brand

WhiteWave cited "strong" organic growth in Europe, where it sells the Alpro brand

Alpro and Silk owner WhiteWave Foods today (10 November) lifted its forecasts for 2014 sales and underlying earnings per share after reporting a "record" third quarter.

However, shares in the US group fell, to the surprise of some analysts.

WhiteWave said it expects its net sales to grow "in the low to mid-thirties" on a percentage basis. Excluding the acquisition of US organic business Earthbound Farm earlier this year, WhiteWave now estimates its net sales will increase 11% this year, up from an earlier forecast of an 8-9% rise.

In the third quarter of the year, WhiteWave saw its net sales jump by more than a third to US$857m. On an organic basis, net sales grew 12%.

"Our organic net sales growth of 12% in the third quarter is the highest rate we achieved this year. Impressive results by our market-leading brands in North America and Europe powered another strong quarter as consumers across continents are increasingly looking for great-tasting, healthy and responsibly produced foods and beverages," chairman and CEO Gregg Engles said.

Net income jumped 68% to $41m. On an adjusted basis, excluding items like commodity hedging costs and charges from the spin-off from Dean Foods last year, net income was up 38% at $47m.

Operating income leapt 74% to $73m. Adjusted operating income increased 50% to $82m.

For 2014, WhiteWave said it expects adjusted total operating income to rise in the mid-forties on a percentage basis. In August, the company had published a range from the low to the mid-forties.

WhiteWave also updated its forecasts for its 2014 adjusted diluted earnings per share. It had estimated EPS would be between $0.98 and $1.00 - excluding investments in its joint venture in China - but today forecast a range of between $0.99 and $1.00.

The company said the new forecast was essentially an increase of $0.02-0.03 cents a share as it includes the impact from higher interest expenses as a result of notes issued in the third quarter of the year.

Shares in WhiteWave were down 3.41% at $35.67 at 14:01 ET.

One analyst admitted they had been "struggling" to work out why WhiteWave's shares fell, pointing to the company's results beating forecast and the increase to its EPS forecast. "It is a beat and raise, maybe just not as much as investors wanted," the analyst said. "[The] long-term thesis is intact. There was no real source of controversy here, in our view."

However, BMO Capital Markets analyst Amit Sharma added: "Expectations were relatively high going into the quarter and there is some disappointment with the magnitude of [the] beat and raise."