SunOpta Announces Record Second Quarter Results; Revenues Increase 33.5% and Net Earnings Increase 55.4%



    TORONTO, August 8 /CNW/ - SunOpta Inc. (SunOpta or the Company)
(Nasdaq:  STKL) (TSX:SOY) today announced record results for the second quarter
ended June 30, 2007. All amounts are expressed in U.S. dollars.

    The Company achieved record revenues for the three months ended June 30,
2007, realizing its 39th consecutive quarter of increased revenue growth
versus the same quarter in the previous year. Revenues in the quarter
increased by 33.5% to $207,977,000 as compared to $155,745,000 in the second
quarter of 2007, led by a 37.9% increase in revenues within the Company's
vertically integrated natural and organic food operations. The Company's
revenue growth in the quarter reflects an internal growth rate of 16.2% on a
consolidated basis and includes internal growth of 19.4% within the SunOpta
Food Group.

    Operating income (1) for the quarter increased to $11,402,000 as compared
to $8,772,000 in 2006, driven by increases in segment operating income in all
groups within the SunOpta Food Group and led by the SunOpta Grains and Foods
Group and the SunOpta Distribution Group. Net earnings in the quarter were
$6,750,000 or $0.11 per diluted common share as compared to $4,343,000 or
$0.08 per diluted common share in the prior year.

    For the six months ended June 30, 2007 the company has recognized record
revenues of $391,417,000 versus $289,057,000 in the same period of the prior
year, an increase of 35.4%. Net earnings for the period increased 44.1% to
$10,600,000 or $0.17 per diluted common share as compared to $7,355,000 or
$0.13 per diluted common share for the same period in 2006.

    In the quarter, the SunOpta Food Group reported increased revenues of
$189,264,000 as compared to $137,287,000 in the second quarter of 2006, a
37.9% increase. Segment operating income increased to $11,411,000 versus
$8,168,000 in 2006, an increase of 39.7%. This increase is after additional
corporate cost allocations of $1,326,000. Excluding these allocations, segment
operating income increased 55.9%. The improved segment operating income was
driven by the continued rebound in sales and margins within sunflower product
operations, strong volumes and margins in organic grains, packaged soy milk
products and food ingredients, strong demand for organic frozen fruit products
and improved margins within the SunOpta Distribution Group. During the second
quarter the Company's fruit bar operations continued to implement improvements
designed to address ongoing operational issues which have impacted results in
the first half of the year. The Company expects significant revenue and margin
improvements in these operations as major capacity and equipment upgrades are
completed late in the third quarter.

    Opta Minerals revenue increased to $18,394,000, due primarily to the
acquisition of Bimac Corporation late in 2006, offset by cyclical weakness in
the foundry and steel industries. Segment operating income for the quarter
declined by 14.0% to $2,061,000 from $2,396,000, due primarily to product mix
and reduced sales of higher margin desulphurization products. The Group
continues to pursue strategic transactions and new product development to
complement its existing product portfolio.

    During the quarter the Company completed a $30 million dollar financing
within SunOpta BioProcess Inc.(SBI) at a post money valuation of $230 million.
The funds from this financing will be used to further leverage its technology
and invest directly in the production of cellulosic ethanol. SBI is working
toward completion of current proprietary pre-treatment and fiber preparation
equipment projects and is pursuing a number of exciting cellulosic ethanol
projects in both North America and around the world.

    The Company remains well positioned for future growth with working
capital of $155,316,000 and total assets of $525,424,000. Capital additions in
the quarter were $6,985,000 as compared to $2,069,000 for the same period in
the prior year. The long term debt to equity ratio at June 30, 2007 was
0.31:1:00, providing the Company financial resources to invest in internal
growth, capital projects and execute on its acquisition program. Book equity
per outstanding common share has grown to $3.94 from $3.72 at March 31, 2007.

    Steve Bromley, President and Chief Executive Officer of SunOpta
commented, "We are very pleased with our second quarter results, driven by
solid internal growth of over 19% within our vertically integrated food
operations. These earnings are consistent with our expectations for the second
quarter and reflect our continued dedication to the growth of our business,
both top line and bottom line. Based on these results, we are pleased to
increase our annual revenue guidance to $775 to $800 million and confirm our
net earnings guidance of $0.35 to $0.40 per share, including the dilutive
impact of the additional shares issued during the first quarter."

    About SunOpta Inc.

    SunOpta Inc. is an operator of high-growth ethical businesses, focusing
on integrated business models in the natural and organic food, supplements and
health and beauty markets. The Company has three business units: the SunOpta
Food Group, which specializes in sourcing, processing and distribution of
natural and organic food products integrated from seed through packaged
products; Opta Minerals Inc. (TSX:OPM) (70.4% owned by SunOpta), a producer,
distributor, and recycler of environmentally friendly industrial materials;
and SunOpta BioProcess Inc. (80% owned by SunOpta), which engineers and
markets proprietary steam explosion technology systems for the pulp, bio-fuel
and food processing industries. Each of these business units has proprietary
products and services that give it a solid competitive advantage in its
sector.

    Forward-Looking Statements

    Certain statements included in this press release may constitute
"forward-looking statements" within the meaning of the United States Private
Securities Litigation Reform Act of 1995. These forward-looking statements
include, but are not limited to references to business strategies, competitive
strengths, goals, capital expenditure plans, business and operational growth
plans and references to the future growth of the business. These forward
looking statements are based on certain assumptions and analyses made by the
Company in light of its experience and its interpretation of current
conditions, historical trends and expected future developments as well as
other factors that the Company believes are appropriate in the circumstance.
However, whether actual results and developments will agree with expectations
and predications of the Company is subject to many risks and uncertainties
including, but not limited to; general economic, business or market risk
conditions; competitive actions by other companies; changes in laws or
regulations or policies of local governments, provinces and states as well as
the governments of United States and Canada, many of which are beyond the
control of the Company. Consequently all forward-looking statements made
herein are qualified by these cautionary statements and there can be no
assurance that the actual results or developments anticipated by the Company
will be realized.

    (1) Operating income and segment operating income are defined as net
earnings before other income, interest expense (net), income taxes and
minority interest.

    
    SunOpta Inc.
    Condensed Consolidated Statements of Earnings
    For the three months ended June 30, 2007 and 2006
    (Expressed in thousands of U.S. dollars, except per share amounts)
    ----------------------------------------------------------------------

    (Unaudited)                                 June 30,  June 30,
                                                    2007      2006      %
                                                       $         $  Change
    ----------------------------------------------------------------------
    Revenues                                     207,977   155,745   33.5%

    Cost of goods sold                           167,859   128,399   30.7%
                                                --------------------------

    Gross profit                                  40,118    27,346   46.7%

    Warehousing and distribution expenses          4,969     3,834   29.6%
    Selling, general and administrative
     expenses                                     22,962    14,600   57.3%
    Intangible amortization                        1,012       737   37.3%
                                                --------------------------

    Earnings before the following                 11,175     8,175   36.7%

    Interest expense, net                        (1,817)   (1,748)    3.9%
    Other expense                                  (217)     (194)   11.9%
    Foreign exchange                                 227       597 (62.0%)
                                                --------------------------

                                                 (1,807)   (1,345)   34.3%
                                                --------------------------

    Earnings before income taxes                   9,368     6,830   37.2%

    Provision for income taxes                     2,296     2,087   10.0%
                                                --------------------------

    Net earnings before minority interest          7,072     4,743   49.1%

    Minority interest                                322       400 (19.5%)
                                                --------------------------

    Net earnings for the period                    6,750     4,343   55.4%
                                                --------------------------

    Net earnings per share for the period

       - Basic                                      0.11      0.08
                                                --------------------------

       - Diluted                                    0.11      0.08
                                                --------------------------
    

    
    SunOpta Inc.
    Condensed Consolidated Statements of Earnings
    For the six months ended June 30, 2007 and 2006
    (Expressed in thousands of U.S. dollars, except per share amounts)
    ----------------------------------------------------------------------

    (Unaudited)                                  June 30, June 30,
                                                     2007     2006       %
                                                        $        $  Change
    ----------------------------------------------------------------------
    Revenues                                      391,417  289,057   35.4%

    Cost of goods sold                            316,457  238,083   32.9%
                                                 -------------------------

    Gross profit                                   74,960   50,974   47.1%

    Warehousing and distribution expenses           9,907    7,492   32.2%
    Selling, general and administrative expenses   43,989   27,787   58.3%
    Intangible amortization                         1,995    1,281   55.7%
                                                 -------------------------

    Earnings before the following                  19,069   14,414   32.3%

    Interest expense, net                         (3,729)  (3,147)   18.5%
    Other expense                                   (406)    (279)   45.5%
    Foreign exchange                                  309      389 (20.6%)
                                                 -------------------------

                                                  (3,826)  (3,037)   26.0%
                                                 -------------------------

    Earnings before income taxes                   15,243   11,377   34.0%

    Provision for income taxes                      4,119    3,490   18.0%
                                                 -------------------------

    Net earnings before minority interest          11,124    7,887   41.0%

    Minority interest                                 524      532  (1.5%)
                                                 -------------------------

    Net earnings for the period                    10,600    7,355   44.1%
                                                 -------------------------

    Net earnings per share for the period

       - Basic                                       0.17     0.13
                                                 -------------------------

       - Diluted                                     0.17     0.13
                                                 -------------------------
    

    
    SunOpta Inc.
    Condensed Consolidated Balance Sheets
    As at June 30, 2007 and December 31, 2006
    (Expressed in thousands of U.S. dollars, except per share amounts)
    ----------------------------------------------------------------------

    (Unaudited)                                      June 30, December 31,
                                                         2007         2006
                                                            $            $
    ----------------------------------------------------------------------

    Assets

    Current assets
    Cash and cash equivalents                          29,680          954
    Accounts receivable                                99,708       73,599
    Inventories                                       171,626      126,736
    Prepaid expenses and other current assets           7,896        8,129
    Current income taxes recoverable                        -        1,829
    Deferred income taxes                               1,824        1,824
                                                     ---------------------

                                                      310,734      213,071

    Property, plant and equipment                     103,675       87,487
    Goodwill                                           54,433       49,457
    Intangible assets, net                             48,771       47,943
    Deferred income taxes                               5,349        5,615
    Other assets                                        2,462        1,157
                                                     ---------------------

                                                      525,424      404,730
                                                     ---------------------
    Liabilities

    Current liabilities
    Bank indebtedness                                  63,813       40,663
    Accounts payable and accrued liabilities           81,799       80,851
    Customer and other deposits                           570          957
    Current portion of long-term debt                   7,947        8,433
    Current portion of long-term payables               1,289        1,736
                                                     ---------------------

                                                      155,418      132,640

    Long-term debt                                     68,456       69,394
    Long-term payables                                  3,065        3,607
    Deferred income taxes                              12,268       12,156
                                                     ---------------------

                                                      239,207      217,797
                                                     ---------------------

    Preference shares issued by subsidiary             26,890            -

    Minority interest                                  10,809       10,230

    Shareholders' Equity

    Capital stock                                     166,876      112,318
    Contributed surplus                                 4,634        4,188
    Retained earnings                                  61,938       51,338
    Cumulative other comprehensive income              15,070        8,859
                                                     ---------------------

                                                      248,518      176,703
                                                     ---------------------

                                                      525,424      404,730
                                                     ---------------------
    

    
    SunOpta Inc.
    Condensed Consolidated Statements of Cash Flow
    For the three months ended June 30, 2007 and 2006
    (Expressed in thousands of U.S. dollars, except per share amounts)
    ----------------------------------------------------------------------

                                                         June 30, June 30,
                                                             2007     2006
    (Unaudited)                                                 $        $
    ----------------------------------------------------------------------
    Cash provided by (used in)

    Operating activities
    Net earnings for the period                             6,750    4,343
    Items not affecting cash
        Amortization                                        3,496    2,731
        Deferred income taxes                                 983      115
        Minority interest                                     322      400
        Other                                                 307      449
    Changes in non-cash working capital                  (21,997)      229
                                                         -----------------

                                                         (10,139)    8,267
                                                         -----------------
    Investing activities
    Purchase of property, plant and equipment             (6,985)  (2,069)
    Acquisition of companies, net of cash acquired       (13,380)        -
    Other                                                    (88)      182
                                                         -----------------

                                                         (20,453)  (1,887)
                                                         -----------------
    Financing activities
    Increase (decrease) in bank indebtedness               32,306  (7,478)
    Borrowings under long-term debt                             -      258
    Repayment of long-term debt                           (1,518)  (1,160)
    Repayment of deferred purchase consideration                -    (260)
    Proceeds from the issuance of common shares               887    2,107
    Proceeds from the issuance of preference shares by
     subsidiary                                            27,880        -
    Other                                                      54    (241)
                                                         -----------------
                                                           59,609  (6,774)


    Foreign exchange gain on cash held in a foreign
     currency                                                 214        2
                                                         -----------------

    Increase (decrease) in cash and cash equivalents
     during the period                                     29,231    (392)
    Cash and cash equivalents - Beginning of the period       449    5,068
                                                         -----------------

    Cash and cash equivalents - End of the period          29,680    4,676
                                                         -----------------
    

    
    SunOpta Inc.
    Condensed Consolidated Statements of Cash Flow
    For the six months ended June 30, 2007 and 2006
    (Expressed in thousands of U.S. dollars, except per share amounts)
    ----------------------------------------------------------------------

                                                         June 30, June 30,
                                                             2007     2006
    (Unaudited)                                                 $        $
    ----------------------------------------------------------------------
    Cash provided by (used in)

    Operating activities
    Net earnings for the period                            10,600    7,355
    Items not affecting cash
        Amortization                                        6,927    5,346
        Deferred income taxes                               1,311      436
        Minority interest                                     524      532
        Other                                                 544      557
    Changes in non-cash working capital                  (58,323)  (6,467)
                                                         -----------------

                                                         (38,417)    7,759
                                                         -----------------
    Investing activities
    Purchase of property, plant and equipment            (12,362)  (4,824)
    Acquisition of companies, net of cash acquired       (13,380) (12,197)
    Acquisition of patents, trademarks and licences         (887)        -
    Other                                                 (1,331)      171
                                                         -----------------

                                                         (27,960) (16,850)
                                                         -----------------
    Financing activities
    Increase in bank indebtedness                          21,734    5,358
    Borrowings under long-term debt                         1,500    2,800
    Repayment of term debt                                (7,504)  (2,304)
    Repayment of deferred purchase consideration          (1,089)    (260)
    Proceeds from the issuance of common shares            52,616    2,977
    Proceeds from the issuance of preference shares by
     subsidiary                                            27,880        -
    Other                                                       -    (370)
                                                         -----------------
                                                           95,137    8,201


    Foreign exchange (loss) gain on cash held in a
     foreign currency                                        (34)      111
                                                         -----------------

    Increase (decrease) in cash and cash equivalents
     during the period                                     28,726    (779)
    Cash and cash equivalents - Beginning of the period       954    5,455
                                                         -----------------

    Cash and cash equivalents - End of the period          29,680    4,676
                                                         -----------------
    

    
    SunOpta Inc.
    Segmented Operations
    For the three months ended June 30, 2007 and 2006
    (Expressed in thousands of U.S. dollars, except per share amounts)
    (Unaudited)
    ----------------------------------------------------------------------

                                                        Three months ended
                                                             June 30, 2007
                                ------------------------------------------
                                                     SunOpta
                                SunOpta     Opta   BioProcess
                                  Food   Minerals        and
                                  Group      Inc.   Corporate Consolidated
                                      $         $           $            $

        Total revenue           189,264    18,394         319      207,977
                                ------------------------------------------

        Segment operating
         income                  11,411     2,061     (2,070)       11,402
                                ------------------------------------------
    

    
        The SunOpta Food Group has the following segmented reporting:

                                                        Three months ended
                                                             June 30, 2007
                        --------------------------------------------------
                         SunOpta
                          Grains                          SunOpta  SunOpta
                              &      SunOpta SunOpta  Distribution   Food
                          Foods  Ingredients  Fruit         Group    Group
                               $           $       $             $       $

        Total revenues
         from external
         customers        64,618      18,495  54,908        51,243 189,264
                         -------------------------------------------------

        Segment
         operating
         income            4,695       1,972   2,955         1,789  11,411
                         -------------------------------------------------
    

    
                                                        Three months ended
                                                             June 30, 2006
                                ------------------------------------------
                                                     SunOpta
                                SunOpta     Opta   BioProcess
                                  Food   Minerals        and
                                  Group      Inc.   Corporate Consolidated
                                      $         $           $            $

        Total revenue           137,287    18,260         198      155,745
                                ------------------------------------------

        Segment operating
         income                   8,168     2,396     (1,792)        8,772
                                ------------------------------------------
    

    
        The SunOpta Food Group has the following segmented reporting:

                                                        Three months ended
                                                             June 30, 2006
                        --------------------------------------------------
                         SunOpta
                          Grains                          SunOpta  SunOpta
                              &      SunOpta SunOpta  Distribution   Food
                          Foods  Ingredients  Fruit         Group    Group
                               $           $       $             $       $

        Total revenue     49,862      17,138  39,491        30,796 137,287
                         -------------------------------------------------

        Segment
         operating
         income            2,273       1,774   2,870         1,251   8,168
                         -------------------------------------------------
    

    
    SunOpta Inc.
    Segmented Operations
    For the six months ended June 30, 2007 and 2006
    (Expressed in thousands of U.S. dollars, except per share amounts)
    (Unaudited)
    ----------------------------------------------------------------------

                                                          Six months ended
                                                             June 30, 2007
                                ------------------------------------------
                                                     SunOpta
                                SunOpta     Opta   BioProcess
                                  Food   Minerals         and
                                  Group      Inc.   Corporate Consolidated
                                      $         $           $            $

        Total revenue           355,526    34,857       1,034      391,417
                                ------------------------------------------

        Segment operating
         income                  19,346     3,508     (3,476)       19,378
                                ------------------------------------------
    

    
        The SunOpta Food Group has the following segmented reporting:

                                                          Six months ended
                                                             June 30, 2007
                        --------------------------------------------------
                         SunOpta
                          Grains                          SunOpta  SunOpta
                              &      SunOpta SunOpta  Distribution   Food
                          Foods  Ingredients  Fruit         Group    Group
                               $           $       $             $       $

        Total revenue    117,209      36,473  96,342       105,502 355,526
                         -------------------------------------------------

        Segment
         operating
         income            7,403       2,991   4,410         4,542  19,346
                         -------------------------------------------------
    

    
                                                          Six months ended
                                                             June 30, 2006
                                ------------------------------------------
                                                     SunOpta
                                SunOpta     Opta   BioProcess
                                  Food   Minerals         and
                                  Group      Inc.   Corporate Consolidated
                                      $         $           $            $

        Total revenue           256,558    31,305       1,194      289,057
                                ------------------------------------------

        Segment operating
         income                  14,997     3,394     (3,588)       14,803
                                ------------------------------------------
    

    
        The SunOpta Food Group has the following segmented reporting:

                                                          Six months ended
                                                             June 30, 2006
                        --------------------------------------------------
                         SunOpta
                          Grains                          SunOpta  SunOpta
                              &      SunOpta SunOpta  Distribution   Food
                          Foods  Ingredients  Fruit         Group    Group
                               $           $       $             $       $

        Total revenues
         from external
         customers        89,016      35,251  70,587        61,704 256,558
                         -------------------------------------------------

        Segment
         operating
         income            4,066       3,480   4,370         3,081  14,997
                         -------------------------------------------------
    




For further information:

For further information: SunOpta Inc. Jeremy N. Kendall, Chairman Steve
Bromley, President & CEO Joseph Riz, Executive Vice President John Dietrich,
Vice President & CFO Susan Wiekenkamp, Information Officer Tel: 905-455-2528,
ext 103 susan.wiekenkamp@sunopta.com Website: www.sunopta.com OR Investment
Community Inquiries: Lytham Partners, LLC Joe Diaz Robert Blum Joe Dorame Tel:
602-889-9700 diaz@lythampartners.com

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SUNOPTA INC.

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