ROUGEMONT, QC, Nov. 15, 2011 /CNW Telbec/ - Lassonde Industries Inc.
(TSX: LAS.A) (Lassonde) posted third quarter sales of $210.8 million,
up 54.2% from the same quarter of 2010. Compared to 2010, profit
attributable to the Company's shareholders decreased $0.6 million to
$8.2 million. It should be noted that various costs related to the
acquisition of Clement Pappas and Company, Inc. (CPC) had an
unfavourable after-tax impact of approximately $2.9 million on profit
for the third quarter of 2011.
These results are presented in accordance with International Financial
Reporting Standards (IFRS). The results of the same quarter last year have been restated
accordingly. An explanatory note concerning the transition is presented
in Note 21 to the interim condensed consolidated financial statements
dated October 1, 2011.
(in thousands of Canadian dollars)
Third quarters ended
Profit before income taxes
Profit attributable to the Company's shareholders
Basic and diluted earnings per share (in $)
Note: These are financial highlights only. Management's Discussion and
Analysis, the unaudited interim condensed consolidated financial
statements and notes thereto for the third quarter ended October 1,
2011 will be available on the SEDAR website at www.sedar.com and on the website of Lassonde Industries Inc.
"We are satisfied with the progress made regarding the integration of
CPC. Although the results of our new subsidiary reflect only seven
weeks of operations, they have met our expectations," said Pierre-Paul
Lassonde, Chairman of the Board and Chief Executive Officer of Lassonde
It should first be noted that, on August 12, 2011, the Company along
with members of the Pappas and Lassonde families, completed the
acquisition of CPC for a total cash consideration of US$400.9 million.
Pursuant to this transaction, the Company holds 70.7% of the shares in
CPC. Of the remaining 29.3%, 19.3% is held by members of the Pappas
family and 10.0% by members of the Lassonde family.
The Company's sales stood at $210.8 million in the third quarter of
2011, up $74.1 million or 54.2% from sales of $136.7 million for the
same period of 2010. Sales from CPC added $63.6 million to the sales of
third quarter 2011. Excluding CPC's sales, the Company's third quarter
sales posted a year-over-year increase of $10.5 million (7.7%), mainly
due to price increases and higher sales of private label products. The
increase in sales was mitigated by the unfavourable impact of exchange
rates on sales in U.S. dollars. For the first nine months of 2011,
total sales stood at $490.7 million, up 24.0% from sales of
$395.6 million for the first nine months of 2010.
The Company's operating profit for the third quarter of 2011 stood at
$13.8 million, up $0.1 million or 0.6% from operating profit of
$13.7 million in the same quarter last year. Excluding the impact of
the CPC acquisition, operating profit was down $0.9 million (7.0%) from
last year's third quarter. This decrease is mostly explained by the
fact that price increases were not sufficient to offset the
unfavourable impact of sharp rises in apple and orange concentrate
costs. The Company's cost of sales was also affected by substantially
higher costs for PET, a plastic material used in manufacturing bottles.
As for CPC, its third quarter operating profit stood at $1.0 million,
but it should be noted that this amount includes $6.8 million in
acquisition-related costs. Operating profit for the first nine months
of 2011 stood at $35.4 million, up 8.7% from $32.6 million recorded at
the end of the first nine months of 2010.
The Company's financial expenses net of financial revenues rose from
$1.2 million in the third quarter of 2010 to $3.8 million in this third
quarter. The higher financial expenses were mainly due to the financing
of the CPC acquisition and the related $2.6 million increase in
interest expense. Other (gains) losses went from a $0.2 million loss in
the third quarter of 2010 to a $0.7 million gain in the third quarter
of 2011. The 2011 gain comes from the combined impact of a $1.6 million
exchange gain on a bank balance of approximately US$70 million held to
carry out the CPC acquisition and a $0.9 million loss from the change
in fair value of financial instruments. For the first nine months,
financial revenues went from $0.3 million in 2010 to $0.4 million in
2011; financial expenses went from $3.8 million in 2010 to $6.4 million
in 2011, and other (gains) losses remained stable with a loss of
$0.2 million for both 2010 and 2011.
Profit before income taxes stood at $10.6 million for the third quarter
of 2011, down $1.7 million from $12.3 million in the same quarter last
year. Profit before income taxes for the first nine months of 2011
stood at $29.1 million, up 0.9% from $28.9 million in the first nine
months of 2010.
An income tax expense at an effective rate of 25.2% (compared to 28.9%
in 2010) brought the 2011 third quarter profit to $8.0 million, down
9.3% from $8.8 million in the same quarter of 2010. It should be noted
that the total unfavourable impact of all acquisition-related
transactions (including the exchange gain on U.S. cash and cash
equivalents) was approximately $2.9 million. Profit attributable to the
Company's shareholders was $8.2 million, resulting in basic and diluted
earnings per share of $1.20 for the third quarter of 2011. This amount
reflects the allocation of a portion of CPC's loss to a non-controlling
interest. For the same period of 2010, profit attributable to the
Company's shareholders stood at $8.8 million, resulting in basic and
diluted earnings per share of $1.33. For the first nine months of 2011,
profit attributable to the Company's shareholders stood at
$21.3 million for basic and diluted earnings per share of $3.21, while
it had reached $20.5 million for basic and diluted earnings per share
of $3.11 in 2010.
The condensed consolidated statement of cash flows shows that operating
activities generated $23.4 million in cash in the third quarter of
2011, while the same activities had generated $13.2 million in cash in
the same period last year. Financing activities generated
$307.4 million in the third quarter of 2011, while these activities had
used $2.4 million in the same quarter of 2010. During the third quarter
of 2011, financing through CPC generated $260.9 million in cash flows,
leaving $48.9 million for comparative balances. The $48.9 million
variance was mainly due to a $2.7 million increase in bank
indebtedness, $30.2 million in net proceeds from the offering of
420,000 Class A shares, and the addition of a $15.9 million
non-controlling interest. Investing activities used $398.9 million in
the third quarter of 2011 compared to $8.7 million for the same quarter
of 2010. Excluding the $393.4 million related to CPC, the resulting
change in investing cash flows was $3.2 million. At the end of the
third quarter of 2011, the Company reported a bank overdraft of
$9.2 million, compared to cash and cash equivalents of $57.2 million at
the end of the third quarter of 2010.
The CPC acquisition has a significant impact on the Company's results.
To better understand the impact of this acquisition, it is important to
note that CPC recorded, for the 12 months ended October 1, 2011, sales
of approximately US$400 million and EBITDA of approximately
US$58 million. It is also worth noting that CPC's sales for the last
three months of the year have been slightly higher than other months of
The North American market for fruit juice and drinks is impacted by
higher raw material costs. As food processors adjust their prices to
respond to the situation, the consumption volume is exposed to downward
pressure in the retail sector. The costs of apple and orange
concentrates are still rising steeply despite expectations of good
crops. The Company adjusts its selling prices to minimize the effect of
these significant fluctuations on its profitability but believes that
these adjustments might not be sufficient to offset raw material
increases. In addition, the Company has observed that its price
adjustments have had some negative effects on sales volume.
Barring any major external shocks and excluding the sales of CPC, the
Company remains confident about its ability to maintain 2011 sales
growth at a level slightly higher than in fiscal 2010.
About Lassonde Industries Inc.
Lassonde Industries is a North American leader in the development,
manufacture and sale of innovative and distinctive lines of fruit and
vegetable juices and drinks marketed under recognized brands such as
Everfresh, Fairlee, Flavür, Fruité, Graves, Oasis and Rougemont.
Subsidiaries include Clement Pappas and Company, Inc., the
second-largest producer of store brand ready-to-drink fruit juices and
drinks in the Unites States, and a major producer of cranberry juices,
drinks and sauces. Headquartered in New Jersey, Clement Pappas operates
five production facilities and a cranberry receiving station that
enable it to provide its U.S. customers with coast-to-coast service.
Lassonde also markets specialty food products such as fondue broths and
sauces, cheese and chocolate fondues, soups, gravies, and sauces for
pasta and pizza under recognized trademarks such as Antico and Canton.
The Company imports and markets selected wines from various countries
of origin, and manufactures apple ciders and wine-based beverages.
Lassonde strives to maintain high standards of quality and to promote
active and healthy living. More than 2,000 employees contribute to the
Company's growth. To learn more, visit www.lassonde.com.
SEDAR registration number: 00002099
Caution Concerning Forward-Looking Statements
This press release contains forward-looking statements that are based on
certain assumptions. These forward-looking statements are subject to a
number of risks and uncertainties that could cause actual results or
events to differ materially from current expectations. Additional
factors are discussed in materials filed from time to time with the
securities regulatory authorities in Canada. Lassonde Industries Inc.
disclaims any intention or obligation to update or revise any
forward-looking statements except as required by law.
SOURCE LASSONDE INDUSTRIES INC.
For further information:
| Investor contact |
Guy Blanchette, CA, FCMA
Vice-President and Chief Financial Officer
Lassonde Industries Inc.
450-469-4926, extension 10782
| Media contact |
Lassonde Industries Inc.
450-469-4926, extension 10265