Odwalla's Sales Up 75%

New Products and East Coast Expansion Fuel Nourishment Company's 'Big Idea'



Apr 12, 2001, 01:00 ET from Odwalla, Inc.

    HALF MOON BAY, Calif., April 12 /PRNewswire/ --
 Odwalla, Inc. (Nasdaq:   ODWA) today announced financial results for its
 thirteen-week second quarter ended March 3, 2001.  Second quarter net sales
 were $31.7 million, a 75% increase over the $18.1 million in sales during last
 year's second quarter ended February 26, 2000.  Odwalla recorded a
 $298,000 net income for the quarter, before considering the restructuring and
 other charges discussed below, compared to a net loss of $266,000 for the same
 period last year.
     (Photo:   http://www.newscom.com/cgi-bin/prnh/19990427/ODWALLALOGO )
     "Despite the fact that the second quarter is often our most challenging
 from a cost viewpoint, we recorded a profitable second quarter, excluding the
 special charges for the quarter -- for the first time since fiscal 1995," said
 Stephen Williamson, Chairman and CEO. "Expanding our 'big idea' --  easy
 access to great tasting nourishment coast to coast -- is proving beneficial,
 both through investments in our California plant and our East Coast
 expansion," he added.
     Gross profit for the second quarter was 52.8% of net sales compared to
 47.0% in the second quarter of fiscal 2000.  The current year margin reflects
 the benefit of previous investments in the Dinuba production facility and more
 normalized raw fruit pricing.  The prior year margin was impacted by the
 December 1998 California citrus crop freeze.
     Sales and distribution costs for the second quarter were 36.8% of net
 sales compared to 34.7% for the same period last year.  In the second quarter
 of this year, Odwalla continued to invest in strengthening its overall sales
 and distribution organization, as was previously announced.  This investment
 is expected to continue for at least the next two quarters of fiscal 2001.
 Marketing and general and administrative expenses were $3.8 million for the
 second quarter of this year compared to $2.5 million for the same quarter last
 year.  The increase was primarily due to the acquisition of Fresh Samantha in
 May 2000.  Amortization of intangible assets acquired with the Fresh Samantha
 merger resulted in a $577,000 expense this quarter.
     Operating income for the quarter, excluding amortization of intangible
 assets from the Fresh Samantha acquisition and the restructuring and other
 charges discussed below, was $1.2 million compared to a loss of $274,000 in
 the same quarter last year.  Net income, excluding the restructuring and other
 charges discussed below, was $298,000 or $0.03 per basic and diluted share for
 the second quarter of fiscal 2001. This compares to a net loss of $266,000 or
 $0.05 per share for the same period in fiscal 2000 before considering the
 impact of the preferred stock dividend of $213,000 or $0.04 per share.  The
 increase in net income resulted from the benefits from the investments in the
 Dinuba production facility, the effect of the December 1998 California citrus
 crop freeze on the results of fiscal 2000, the acquisition of Fresh Samantha,
 and investments in the company's sales and distribution organization. After
 considering the restructuring and other charges discussed below, the net loss
 for the second quarter of fiscal 2001 was $1.6 million or $.14 per share.
     On December 14, 2000, Odwalla announced that Doug Levin, Founder and CEO
 of Fresh Samantha, was leaving the company after helping to complete the
 successful merger of Odwalla and Fresh Samantha.  On January 11, 2001, Odwalla
 announced the relocation of Fresh Samantha production to southern Florida in a
 new state of the art production facility to be operational in late 2001.  The
 move will result in the closure of the Saco, Maine production facility.  In
 December and January, the company also announced some management changes in
 its East Coast operations. These events resulted in a $3.5 million charge
 taken in the second quarter of fiscal 2001, as was previously announced.  The
 impact, net of taxes, was $1.8 million, or $0.17 per share.  The charge
 includes the estimated costs to exit the Saco facility, including severance
 pay for terminated employees, losses on the existing facility lease, and
 abandoned assets, amounts due Mr. Levin under his separation agreement, and
 amounts due other individuals under severance agreements.
     For the first twenty-six weeks of fiscal 2001, net sales were
 $63.1 million or 81.0% higher than the $34.9 million of net sales for the same
 period last year, the increase being due mainly to the acquisition of Fresh
 Samantha.  Gross profit was 52.8% compared to 46.8% for the first twenty-six
 weeks of fiscal 2000.  The end of the impact of the December 1998 California
 citrus freeze and the benefits from the investments in the Dinuba production
 facility during the past eighteen months accounts for much of the improved
 gross profit.
     Sales and distribution costs were 35.9% of net sales for the first
 twenty-six weeks of this year, the same percentage as the first twenty-six
 weeks of fiscal 2000.  Marketing and general and administrative expenses were
 $7.8 million in the first twenty-six weeks of fiscal 2001 compared to
 $4.9 million for the same period last year, the increase being mainly due to
 the acquisition of Fresh Samantha. Amortization of intangible assets acquired
 with the Fresh Samantha merger resulted in a $1.2 million expense for the
 first twenty-six weeks of fiscal 2001.  Net income, excluding the
 restructuring and other charges discussed above, was $814,000 or $0.07 per
 basic and diluted share for the first twenty-six weeks of this year, compared
 to a loss of $991,000 or $0.19 per share for the same period last year, before
 considering the impact of the preferred stock dividend of $426,000 or
 $0.09 per share. After considering the restructuring and other charges
 discussed above, the net loss for the first half of fiscal 2001 was
 $1.0 million or $.09 per share.
     This press release contains forward-looking statements, including
 statements regarding the relocation of our East Coast production facility, the
 construction of a new production facility in Florida, and the investment in
 our sales and distribution organization, that involve certain risks and
 uncertainties.  The Company's actual results could differ materially from
 those anticipated in these forward-looking statements as a result of factors
 and risks, including without limitation, those factors and risks regarding the
 Company's products, distribution and business expansion, described in
 documents the Company files periodically with the Securities and Exchange
 Commission including the Company's last annual report on Form 10-K, filed in
 November 2000.  The annual report and other documents contain and identify
 important factors that could cause the actual results to differ materially
 from those contained in our projections or forward-looking statements.
     Odwalla, Inc., the nation's leading branded super-premium beverage
 company, delivers nourishment coast to coast with the Odwalla and Samantha
 lines of all-natural juices, smoothies, dairy-free regular and chocolate milk,
 dairy-free shakes, spring water and natural food bars. To learn more about the
 Odwalla and Samantha brands, please visit us at www.odwalla.com and at
 www.freshsamantha.com.
 
                                 ODWALLA, INC.
                     Consolidated Statements of Operations
                     (in thousands, except per share data)
 
                            13 weeks    13 weeks      26 weeks      26 weeks
                             ended        ended         ended        ended
                          February 26,   March 3,   February 26,     March 3,
                              2000         2001          2000         2001
 
     Net sales              $18,090       $31,693      $34,859       $63,135
 
     Cost of sales            9,585        14,961       18,541        29,818
 
      Gross profit            8,505        16,732       16,318        33,317
 
     Operating expenses
       Sales and distribution 6,271        11,652       12,498        22,681
       Marketing                590           862        1,133         1,977
       General and
        administrative        1,918         2,973        3,802         5,790
       Amortization of
        intangible assets
        from Fresh Samantha
        acquisition              --          577            --         1,154
 
       Total operating
        expenses before
        restructuring and
        other charges         8,779       16,064        17,433        31,602
 
     Income (loss) from
      operations before
      restructuring and
      other charges            (274)          668       (1,115)        1,715
 
     Restructuring and
      other charges              --         3,490           --         3,490
 
     Loss from operations      (274)       (2,822)      (1,115)       (1,775)
 
     Interest and other income
      (expense), net            (39)         (107)         (51)         (178)
 
     Loss before income taxes  (313)       (2,929)      (1,166)       (1,953)
 
     Income tax benefit          47         1,377          175           919
 
     Net loss                  (266)       (1,552)        (991)       (1,034)
 
     Preferred stock
       dividend                (213)           --         (426)           --
 
     Net loss applicable to
     common shareholders      $(479)      $(1,552)     $(1,417)      $(1,034)
 
     Net loss applicable to
      common shareholders
      after stock dividend -
        Basic                $(0.09)       $(0.14)      $(0.28)       $(0.09)
        Diluted              $(0.09)       $(0.14)      $(0.28)       $(0.09)
 
     Shares used in per
      share amounts
        Basic                 5,126        11,048        5,126        11,042
        Diluted               5,126        11,048        5,126        11,042
 
                                 Odwalla, Inc.
                     Condensed Consolidated Balance Sheets
                                 (in thousands)
 
                                                   September 2,      March 3,
                                                       2000            2001
     Current assets
       Cash, cash equivalents and
        short-term investments                         $5,392         $2,825
       Trade accounts receivable                       11,599         14,143
       Inventories                                      6,705          6,148
       Prepaid expenses and other                       2,357          2,632
       Deferred tax asset                               2,265          3,274
        Total current assets                           28,318         29,022
 
     Plant, property and equipment, net                20,011         22,234
 
     Total other assets                                41,025         39,503
                                                      $89,354        $90,759
 
     Current liabilities
       Accounts payable                                $9,139         $9,296
       Other accrued liabilities                        4,926          5,428
       Line of credit                                   1,950          1,950
       Current maturities of capital lease obligations
        and long-term debt                                591            630
       Total current liabilities                       16,606         17,304
 
     Long-term liabilities
       Capital lease obligations and long-term
        debt and other liabilities, less current
         maturities                                     1,780          3,789
       Deferred tax liability                          10,296          9,844
 
     Total liabilities                                 28,682         30,937
 
     Shareholders' equity                              60,672         59,822
                                                      $89,354        $90,759
 
     CONTACT:  media, MJ Viederman, 603-228-2836, for Odwalla, Inc.; or
 investors, Jim Steichen of Odwalla, Inc., 650-712-5517
 
 

SOURCE Odwalla, Inc.
    HALF MOON BAY, Calif., April 12 /PRNewswire/ --
 Odwalla, Inc. (Nasdaq:   ODWA) today announced financial results for its
 thirteen-week second quarter ended March 3, 2001.  Second quarter net sales
 were $31.7 million, a 75% increase over the $18.1 million in sales during last
 year's second quarter ended February 26, 2000.  Odwalla recorded a
 $298,000 net income for the quarter, before considering the restructuring and
 other charges discussed below, compared to a net loss of $266,000 for the same
 period last year.
     (Photo:   http://www.newscom.com/cgi-bin/prnh/19990427/ODWALLALOGO )
     "Despite the fact that the second quarter is often our most challenging
 from a cost viewpoint, we recorded a profitable second quarter, excluding the
 special charges for the quarter -- for the first time since fiscal 1995," said
 Stephen Williamson, Chairman and CEO. "Expanding our 'big idea' --  easy
 access to great tasting nourishment coast to coast -- is proving beneficial,
 both through investments in our California plant and our East Coast
 expansion," he added.
     Gross profit for the second quarter was 52.8% of net sales compared to
 47.0% in the second quarter of fiscal 2000.  The current year margin reflects
 the benefit of previous investments in the Dinuba production facility and more
 normalized raw fruit pricing.  The prior year margin was impacted by the
 December 1998 California citrus crop freeze.
     Sales and distribution costs for the second quarter were 36.8% of net
 sales compared to 34.7% for the same period last year.  In the second quarter
 of this year, Odwalla continued to invest in strengthening its overall sales
 and distribution organization, as was previously announced.  This investment
 is expected to continue for at least the next two quarters of fiscal 2001.
 Marketing and general and administrative expenses were $3.8 million for the
 second quarter of this year compared to $2.5 million for the same quarter last
 year.  The increase was primarily due to the acquisition of Fresh Samantha in
 May 2000.  Amortization of intangible assets acquired with the Fresh Samantha
 merger resulted in a $577,000 expense this quarter.
     Operating income for the quarter, excluding amortization of intangible
 assets from the Fresh Samantha acquisition and the restructuring and other
 charges discussed below, was $1.2 million compared to a loss of $274,000 in
 the same quarter last year.  Net income, excluding the restructuring and other
 charges discussed below, was $298,000 or $0.03 per basic and diluted share for
 the second quarter of fiscal 2001. This compares to a net loss of $266,000 or
 $0.05 per share for the same period in fiscal 2000 before considering the
 impact of the preferred stock dividend of $213,000 or $0.04 per share.  The
 increase in net income resulted from the benefits from the investments in the
 Dinuba production facility, the effect of the December 1998 California citrus
 crop freeze on the results of fiscal 2000, the acquisition of Fresh Samantha,
 and investments in the company's sales and distribution organization. After
 considering the restructuring and other charges discussed below, the net loss
 for the second quarter of fiscal 2001 was $1.6 million or $.14 per share.
     On December 14, 2000, Odwalla announced that Doug Levin, Founder and CEO
 of Fresh Samantha, was leaving the company after helping to complete the
 successful merger of Odwalla and Fresh Samantha.  On January 11, 2001, Odwalla
 announced the relocation of Fresh Samantha production to southern Florida in a
 new state of the art production facility to be operational in late 2001.  The
 move will result in the closure of the Saco, Maine production facility.  In
 December and January, the company also announced some management changes in
 its East Coast operations. These events resulted in a $3.5 million charge
 taken in the second quarter of fiscal 2001, as was previously announced.  The
 impact, net of taxes, was $1.8 million, or $0.17 per share.  The charge
 includes the estimated costs to exit the Saco facility, including severance
 pay for terminated employees, losses on the existing facility lease, and
 abandoned assets, amounts due Mr. Levin under his separation agreement, and
 amounts due other individuals under severance agreements.
     For the first twenty-six weeks of fiscal 2001, net sales were
 $63.1 million or 81.0% higher than the $34.9 million of net sales for the same
 period last year, the increase being due mainly to the acquisition of Fresh
 Samantha.  Gross profit was 52.8% compared to 46.8% for the first twenty-six
 weeks of fiscal 2000.  The end of the impact of the December 1998 California
 citrus freeze and the benefits from the investments in the Dinuba production
 facility during the past eighteen months accounts for much of the improved
 gross profit.
     Sales and distribution costs were 35.9% of net sales for the first
 twenty-six weeks of this year, the same percentage as the first twenty-six
 weeks of fiscal 2000.  Marketing and general and administrative expenses were
 $7.8 million in the first twenty-six weeks of fiscal 2001 compared to
 $4.9 million for the same period last year, the increase being mainly due to
 the acquisition of Fresh Samantha. Amortization of intangible assets acquired
 with the Fresh Samantha merger resulted in a $1.2 million expense for the
 first twenty-six weeks of fiscal 2001.  Net income, excluding the
 restructuring and other charges discussed above, was $814,000 or $0.07 per
 basic and diluted share for the first twenty-six weeks of this year, compared
 to a loss of $991,000 or $0.19 per share for the same period last year, before
 considering the impact of the preferred stock dividend of $426,000 or
 $0.09 per share. After considering the restructuring and other charges
 discussed above, the net loss for the first half of fiscal 2001 was
 $1.0 million or $.09 per share.
     This press release contains forward-looking statements, including
 statements regarding the relocation of our East Coast production facility, the
 construction of a new production facility in Florida, and the investment in
 our sales and distribution organization, that involve certain risks and
 uncertainties.  The Company's actual results could differ materially from
 those anticipated in these forward-looking statements as a result of factors
 and risks, including without limitation, those factors and risks regarding the
 Company's products, distribution and business expansion, described in
 documents the Company files periodically with the Securities and Exchange
 Commission including the Company's last annual report on Form 10-K, filed in
 November 2000.  The annual report and other documents contain and identify
 important factors that could cause the actual results to differ materially
 from those contained in our projections or forward-looking statements.
     Odwalla, Inc., the nation's leading branded super-premium beverage
 company, delivers nourishment coast to coast with the Odwalla and Samantha
 lines of all-natural juices, smoothies, dairy-free regular and chocolate milk,
 dairy-free shakes, spring water and natural food bars. To learn more about the
 Odwalla and Samantha brands, please visit us at www.odwalla.com and at
 www.freshsamantha.com.
 
                                 ODWALLA, INC.
                     Consolidated Statements of Operations
                     (in thousands, except per share data)
 
                            13 weeks    13 weeks      26 weeks      26 weeks
                             ended        ended         ended        ended
                          February 26,   March 3,   February 26,     March 3,
                              2000         2001          2000         2001
 
     Net sales              $18,090       $31,693      $34,859       $63,135
 
     Cost of sales            9,585        14,961       18,541        29,818
 
      Gross profit            8,505        16,732       16,318        33,317
 
     Operating expenses
       Sales and distribution 6,271        11,652       12,498        22,681
       Marketing                590           862        1,133         1,977
       General and
        administrative        1,918         2,973        3,802         5,790
       Amortization of
        intangible assets
        from Fresh Samantha
        acquisition              --          577            --         1,154
 
       Total operating
        expenses before
        restructuring and
        other charges         8,779       16,064        17,433        31,602
 
     Income (loss) from
      operations before
      restructuring and
      other charges            (274)          668       (1,115)        1,715
 
     Restructuring and
      other charges              --         3,490           --         3,490
 
     Loss from operations      (274)       (2,822)      (1,115)       (1,775)
 
     Interest and other income
      (expense), net            (39)         (107)         (51)         (178)
 
     Loss before income taxes  (313)       (2,929)      (1,166)       (1,953)
 
     Income tax benefit          47         1,377          175           919
 
     Net loss                  (266)       (1,552)        (991)       (1,034)
 
     Preferred stock
       dividend                (213)           --         (426)           --
 
     Net loss applicable to
     common shareholders      $(479)      $(1,552)     $(1,417)      $(1,034)
 
     Net loss applicable to
      common shareholders
      after stock dividend -
        Basic                $(0.09)       $(0.14)      $(0.28)       $(0.09)
        Diluted              $(0.09)       $(0.14)      $(0.28)       $(0.09)
 
     Shares used in per
      share amounts
        Basic                 5,126        11,048        5,126        11,042
        Diluted               5,126        11,048        5,126        11,042
 
                                 Odwalla, Inc.
                     Condensed Consolidated Balance Sheets
                                 (in thousands)
 
                                                   September 2,      March 3,
                                                       2000            2001
     Current assets
       Cash, cash equivalents and
        short-term investments                         $5,392         $2,825
       Trade accounts receivable                       11,599         14,143
       Inventories                                      6,705          6,148
       Prepaid expenses and other                       2,357          2,632
       Deferred tax asset                               2,265          3,274
        Total current assets                           28,318         29,022
 
     Plant, property and equipment, net                20,011         22,234
 
     Total other assets                                41,025         39,503
                                                      $89,354        $90,759
 
     Current liabilities
       Accounts payable                                $9,139         $9,296
       Other accrued liabilities                        4,926          5,428
       Line of credit                                   1,950          1,950
       Current maturities of capital lease obligations
        and long-term debt                                591            630
       Total current liabilities                       16,606         17,304
 
     Long-term liabilities
       Capital lease obligations and long-term
        debt and other liabilities, less current
         maturities                                     1,780          3,789
       Deferred tax liability                          10,296          9,844
 
     Total liabilities                                 28,682         30,937
 
     Shareholders' equity                              60,672         59,822
                                                      $89,354        $90,759
 
     CONTACT:  media, MJ Viederman, 603-228-2836, for Odwalla, Inc.; or
 investors, Jim Steichen of Odwalla, Inc., 650-712-5517
 
 SOURCE  Odwalla, Inc.