First quarter 2012 results: Lassonde Industries Inc. continues to focus on innovation

ROUGEMONT, QC, May 11, 2012 /CNW Telbec/ - Lassonde Industries Inc. (TSX: LAS.A) (Lassonde) posted sales of $233.4 million in the first quarter of 2012, a 75.5% increase year over year. Profit attributable to the Company's shareholders for this period totalled $5.6 million, down $1.1 million from the first quarter of 2011.

Financial highlights
(in thousands of dollars)
First quarters ended
  March 31,
2012
  April 2,
2011
 
Sales $ 233,406   $ 133,014  
Operating profit   13,175     10,590  
Profit before income taxes   7,910     9,508  
Profit attributable to the Company's shareholders   5,616     6,745  
Basic and diluted earnings per share (in $) $ 0.80   $ 1.03  

Note: These are financial highlights only. Management's Discussion and Analysis, the unaudited interim condensed consolidated financial statements and notes thereto for the first quarter ended March 31, 2012 will be available on the SEDAR website at www.sedar.com and on the website of Lassonde Industries Inc.

"We continue to rely on innovation and to invest in our future. The first quarter saw the launch of several new products, resulting in a $1.4 million increase in slotting fees. Despite higher raw material costs and fuel prices, our 2012 first quarter results met our expectations. We are on the right track in integrating Clement Pappas and are progressing well in achieving synergies. Between the acquisition date and March 31, 2012, we repaid US$23.9 million in long-term debt," said Pierre-Paul Lassonde, Chairman of the Board and Chief Executive Officer of Lassonde Industries Inc.

Financial Results
The Company's sales stood at $233.4 million in the first quarter of 2012, up $100.4 million or 75.5% from sales of $133.0 million in the same period of 2011. Sales from Clement Pappas and Company, Inc. (CPC) added $97.2 million to the sales of first quarter 2012. Excluding CPC's sales, the Company's first-quarter sales were up $3.2 million from the same quarter last year, a 2.4% increase that was driven by a favourable sales mix and by price increases introduced in response to higher raw material costs. The favourable impact of these two items was tempered by a slight decline in sales volumes.

The Company's operating profit for the first quarter of 2012 totalled $13.2 million, up $2.6 million or 24.4% from operating profit of $10.6 million in the same quarter last year. Excluding the impact of the CPC acquisition, first-quarter operating profit was down $3.7 million year over year, mainly due to a $1.4 million increase in slotting fees, higher raw material costs and the impact of lower sales volumes on the Company's operating profit. CPC's operating profit for the first quarter of 2012 totalled $6.3 million.

The Company's financial expenses rose from $1.0 million in the first quarter of 2011 to $4.4 million this first quarter, an increase that stems mainly from the financing of the CPC acquisition and explained in part by a $4.8 million increase in interest expense and a $1.4 million reduction in the value of a retractable financial instrument liability. Other (gains) losses went from a loss of less than $0.1 million in the first quarter of 2011 to a $0.8 million loss in the first quarter of 2012. The 2012 first-quarter loss resulted from a $0.5 million loss from the change in fair value on interest rate swaps combined with a $0.3 million exchange loss on the translation of assets and liabilities denominated in U.S. dollars.

Profit before income taxes stood at $7.9 million for the first quarter of 2012, down $1.6 million from $9.5 million in the same quarter last year.

An income tax expense at an effective rate of 25.4% (29.1% in 2011) brought the 2012 first-quarter profit to $5.9 million, down $0.8 million from $6.7 million in the same quarter of 2011. Profit attributable to the Company's shareholders was $5.6 million, resulting in basic and diluted earnings per share of $0.80 for the first quarter of 2012. This amount reflects the allocation of a portion of CPC's profit to a non-controlling interest. In the first quarter of 2011, profit attributable to the Company's shareholders had totalled $6.7 million, resulting in basic and diluted earnings per share of $1.03. Note that the total favourable impact of CPC's contribution to the profit attributable to the Company's shareholders was $1.8 million.

The condensed consolidated statement of cash flows shows that operating activities generated $17.4 million in cash in the first quarter of 2012, while the same activities had generated $20.6 million in cash in the same period last year. During the first quarter of 2012, CPC's operating activities generated $5.1 million, leaving a difference of $8.3 million for comparable balances.

Outlook
The first quarter of 2012 was characterized by the persistently high price of commodities used in finished goods, creating a pressure to raise selling prices that has led to lower cumulative sales volumes for fruit juice and drink producers in both Canada and the United States. While the Company is seeing a stabilization in commodity prices, the current levels remain above historical averages.

Fiscal 2012 will include an entire year of CPC's financial 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 adjusted EBITDA of approximately US$58 million. The Company believes that CPC will record slightly higher sales and a marginally lower EBITDA in 2012 compared to the twelve-month period ended October 1, 2011. For its Canadian entities, Lassonde Industries Inc. anticipates slightly higher sales than in 2011.

The Company does not plan on making major changes to its business model in fiscal 2012 and will focus on the integration of CPC.

About Lassonde Industries Inc.
Lassonde Industries Inc. is a North American leader in the development, manufacture and sale of a wide range of fruit and vegetable juices and drinks marketed under recognized brands such as Everfresh, Fairlee, Flavür, Fruité, Graves, Oasis and Rougemont.

Lassonde is the second-largest producer of store brand ready-to-drink fruit juices and drinks in the United States and a major producer of cranberry juices, drinks and sauces.

Lassonde also markets specialty food products 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.

The Company produces superior quality products through the efforts of some 2,000 people working in 14 plants across Canada and the United States. 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.



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