WhiteWave Foods Reports Strong Second Quarter 2016 Results

 

Reported and Constant Currency Net Sales Increased 14%

Reported Operating Income Increased 31%; Adjusted Constant Currency Operating Income Increased 26% Behind Further Operating Margin Expansion

Banner_frasco-suscripcion-800x250

Reported Diluted Earnings Per Share Increased 38% to $0.29; Adjusted Diluted Earnings per Share, Excluding China Joint Venture Investments, Increased 24% to $0.32

Reiterating Full Year 2016 Adjusted Diluted Earnings Per Share Guidance1 of $1.38 to $1.41 and Increasing Constant Currency Adjusted Diluted Earnings Per Share Guidance1 to $1.43 to $1.46, Excluding China Joint Venture Investments

Entered Into a Definitive Merger Agreement on July 6, 2016, with Danone for WhiteWave to be Acquired for $56.25 Per Share

The WhiteWave Foods Company (NYSE:WWAV)  reported financial results for the second quarter ended June 30, 2016.

WhiteWave’s second quarter 2016 reported diluted earnings per share was $0.29 and adjusted diluted earnings per share was $0.32, excluding operating costs associated with its China joint venture. Including joint venture costs, WhiteWave reported second quarter 2016 adjusted diluted earnings per share of $0.31.

Net sales for second quarter 2016 were $1.1 billion, a 14 percent increase from net sales of $924 million in second quarter 2015. These results were driven by strong organic growth in both the Americas and Europe segments, as well as contributions from acquisitions.

LEA TAMBIÉN: BCI eleva precio objetivo para Cencosud hasta los $2.000

On a constant currency basis, net sales increased 14 percent in second quarter 2016, when compared to second quarter 2015. Excluding acquisitions, organic constant currency net sales increased 7 percent in second quarter 2016, when compared to second quarter 2015.

Reported operating income for second quarter 2016 increased 31 percent to $101 million compared to second quarter 2015, and on an adjusted basis increased 23 percent to $104 million, compared to $85 million in second quarter 2015. On a constant currency basis, adjusted operating income increased 26 percent in second quarter 2016 over the same period in 2015.

«We are pleased with the double-digit topline growth, continued strong margin expansion and robust earnings growth we generated in the second quarter and for the first half of 2016,” said Gregg Engles, chairman and chief executive officer. “In early July, we entered into a definitive merger agreement to be acquired by Danone. This transaction represents an exciting next chapter of growth for WhiteWave as we bring together two companies with a shared mission of changing the way the world eats for the better.”

AMERICAS FOODS & BEVERAGES SEGMENT

WhiteWave’s Americas Foods & Beverages segment consists of four platforms: Plant-based Foods and Beverages, Fresh Foods, Premium Dairy, and Coffee Creamers and Beverages. In second quarter 2016, net sales for Americas Foods & Beverages were $898 million, an increase of 14 percent over second quarter 2015. Growth in the segment reflects strong organic sales growth and contributions from acquisitions. Excluding acquisitions and the impact of currency translations, organic constant currency net sales in the segment increased 6 percent in second quarter 2016 over second quarter 2015. The organic growth rate for second quarter 2016 increased 7.5 percent excluding the impact of Fresh Foods’ results, which began being included within the segment in 2016. Organic growth in the segment continues to be primarily volume driven.

Reported operating income for the Americas Foods & Beverages segment increased 19 percent in second quarter 2016, compared to the same period in 2015. On an adjusted constant currency basis, segment operating income increased 21 percent, with 70 basis points of operating margin expansion when compared to the prior year period. This increase was driven by continued scale leverage, favorable sales mix, supply chain investments and related efficiencies, and the profit contribution from completed acquisitions.

Plant-based Foods and Beverages

The Americas Plant-based Foods and Beverages platform includes Silk® beverages and yogurts, So Delicious® beverages, frozen desserts and yogurts, and Vega® nutritional protein powders and bars. Net sales for this platform increased 25 percent in second quarter 2016 compared to second quarter 2015. Sales were driven by the contribution of Vega, which was acquired on August 1, 2015, and organic growth.

Organic sales, which exclude Vega, increased mid-single digits on a percentage basis in second quarter 2016, driven by continued strong growth in beverages and yogurts, which was partially offset by softness in So Delicious frozen desserts due to temporary customer service disruptions in the quarter that impacted distribution levels. Nut-based beverages experienced high-single digit percentage growth, with plant-based yogurts growing over 20 percent in the quarter. Vega continued its strong growth plot in second quarter 2016, even while lapping prior period distribution increases. WhiteWave continues to maintain its leadership positions across all plant-based categories in which it participates.

“While our organic growth rate in U.S. plant-based was lower than high-single digits in the quarter due to the impact from the disruption in frozen desserts, we continue to see robust long-term growth opportunities for plant-based foods and beverages,” said Blaine McPeak, executive vice president and chief operating officer. “We have launched a completely new advertising campaign to further broaden consumer awareness of the benefits of plant-based and are very excited with new Silk branding and packaging we are rolling out in the third quarter. We also have several new innovative products and packaging formats in both Silk and Vega that we are introducing over the balance of the year.”

Fresh Foods

The Fresh Foods platform consists of the Earthbound Farm® brand, which includes organic salads, fruits and vegetables. While the platform’s frozen product offerings experienced strong growth in the quarter, net sales declined 2 percent in second quarter 2016 when compared to second quarter 2015, as tighter industry supplies of organic salad could not fully service demand and as the business continues to rebuild its distribution following SAP implementation-related disruptions during fourth quarter 2015.

A larger warehouse for this platform was completed and became operational at the end of second quarter 2016, and is expected to begin providing improved efficiencies over the second half of 2016. Management continues to expect ongoing operating improvements over the balance of the year and net sales growth in this platform for 2016, driven by strong sales growth in fourth quarter 2016.

Premium Dairy

The Premium Dairy platform includes Horizon Organic® milk and dairy products, macaroni and cheese, and snacks, along with Wallaby® organic yogurts and kefir beverages. Net sales for this platform increased 11 percent in second quarter 2016 compared to second quarter 2015. Increased sales were primarily driven by the inclusion of Wallaby, which was acquired on August 31, 2015, which continued its strong growth trend in the quarter and continues to exceed management’s original expectations.

Organic sales in this platform grew low-single digits as prior period price increases on Horizon milks were completely lapped during second quarter 2016 and conventional milk prices remained at historically low levels.

The recent innovation of Sir BananasTM bananamilks have performed well in test markets and are in the process of being rolled out nationwide. With a broad product portfolio that meets families’ needs for healthy and convenient kids’ meals and snacks, along with planned marketing campaigns, management believes this platform is well positioned for the back-to-school season.

Coffee Creamers and Beverages

The Coffee Creamers and Beverages platform includes coffee creamers and ready-to-drink beverages under the International Delight®, Dunkin Donuts®, Silk and So Delicious brands, as well as half-and-half dairy creamers under the LAND O LAKES® and Horizon Organic brands. Net sales for this platform increased 15 percent in second quarter 2016 compared to second quarter 2015. Organic sales grew in the mid-teens on a percentage basis in second quarter 2016, driven by strong performance across WhiteWave’s broad creamer portfolio, including flavored creamers, plant-based creamers and half-and-half creamers. With increased velocities and strong share performance, WhiteWave continues to grow ahead of the coffee creamers and whiteners categories in which it participates.

Recent innovations in this platform, which include Simply Pure®, an all-natural and simple ingredient creamer, and StokTM, a cold-brew iced coffee beverage available in multi-serve and single-serve formats across traditional retailers and convenience stores, have been performing well. International Delight also recently expanded its larger size offerings to further align with increasing consumer demand for larger package size formats. In addition, a new International Delight advertising campaign launched in early second quarter 2016 is delivering encouraging initial results.

EUROPE FOODS & BEVERAGES SEGMENT

The Europe Foods & Beverages segment consists of plant-based foods and beverages that are sold primarily under the Alpro® brand. Net sales in the segment increased 14 percent on a reported basis and 15 percent on a constant currency basis in second quarter 2016 compared to second quarter 2015. Sales growth was driven primarily by increased volumes behind continued strong growth in beverages and plant-based yogurts.

Reported operating income for the Europe Foods & Beverages segment increased 23 percent in second quarter 2016, compared to second quarter 2015. On a constant currency basis, segment operating income increased 38 percent in second quarter 2016, with over 250 basis points of operating margin expansion when compared to the prior year period, driven by continued scale leverage, favorable sales mix, increased internal production levels and other operating efficiencies.

ABOUT THE WHITEWAVE FOODS COMPANY

The WhiteWave Foods Company is a leading consumer packaged food and beverage company that manufactures, markets and sells branded plant-based foods and beverages, coffee creamers and beverages, premium dairy products and organic produce. It sells products primarily in North America, Europe and through a joint venture in China. WhiteWave 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®, So Delicious® and Vega™ plant-based foods and beverages, International Delight® and LAND O LAKES®* coffee creamers and beverages, Horizon Organic® and Wallaby Organic® premium dairy products and Earthbound Farm® organic salads, fruits and vegetables. Its popular plant-based foods and beverages brands in Europe include Alpro® and Provamel®. To learn more about WhiteWave, visit www.whitewave.com.

For more information: Seeking Alpha

Fuente: Seeking Alpha


Reciba las últimas noticias de la industria en su casilla:

Suscribirse ✉


 

Please enter your comment!
Please enter your name here