The Strauss Group Today Announces Results for Second Quarter 2012
TEL AVIV, Israel, August 22, 2012 /PRNewswire/ --
THE GROUP REPORTS 5.2% SALES GROWTH, IMPROVEMENT IN INTERNATIONAL COFFEE BUSINESS RESULTS AND STRONG OPERATING RESULTS IN SABRA. THE GROUP'S NON-GAAP OPERATING PROFIT TOTALED NIS 125 MILLION, SIMILAR TO THE CORRESPONDING QUARTER LAST YEAR
Ofra Strauss, Chairperson of the Strauss Group (TASE: STRS.TA), said today: "The Strauss Group continues to implement its work plans while making adjustments for the economic challenges in the various markets where it is active. The Group is reaping the fruits of its investment in Sabra, while continuing to invest in innovation in all areas of its activity, in cutting edge technology and in future growth drivers."
Gadi Lesin, President and Chief Executive Officer of the Strauss Group, said today: "The Strauss Group continues to grow, posting an increase of 5.2% in sales in the second quarter and crossing the four billion shekel mark in sales in the first half. The Group has maintained its operating profit despite further increases in production inputs, a weakening of the currencies in relation to the dollar and challenges in Israel, mainly thanks to the improvement in profit in activities outside of Israel, strict control of expenses and streamlining measures applied to general and administrative expenses.
"In this quarter Strauss, together with a PepsiCo subsidiary, launched the jointly-held global dips and spreads company (Obela), and the company's first product line was launched in Mexico. Strauss Water launched the partnership in England with the Virgin Group, and several days ago the investment in Virgin Strauss Water by funds that are part of the Virgin Group was completed."
Key data on the second quarter[1]and as at June 30, 2012
- Sales totaled NIS 1.9 billion (NIS 1.8 billion last year), an increase of 5.2%; organic sales excluding the effect of changes in exchange rates grew by 6.5%.
- Gross profit totaled NIS 665 million (34.3% of sales) compared to NIS 649 million last year (35.2% of sales), an increase of 2.5%.
- Operating profit totaled approximately NIS 125 million (6.4% of sales) compared to NIS 125 million last year (6.8% of sales), an increase of 0.5%.
- The non-GAAP operating profit in the second quarter was positively influenced by the increase in the non-GAAP operating profit in the International Coffee segment (positive contribution of NIS 9 million) and by the growth in Sabra's operating profit (positive contribution of NIS 9 million). However, these were offset by operating expenses related to building the International Dips and Spreads business (Obela) outside of North America (negative contribution of NIS 5 million), by an increase in the operating loss of the "Other" segment (negative contribution of NIS 4 million), mainly as a result of the increase in operating expenses related to building the activity of Strauss Water in China and England, by a decrease in the results of the Health & Wellness segment (negative contribution of NIS 3 million), a decrease in the Fun & Indulgence segment (negative contribution of NIS 2 million), and a decrease in the operating profit of the Israel Coffee segment (negative contribution of NIS 3 million).
- Net income attributed to the Company's shareholders totaled NIS 35 million compared to NIS 39 million last year, a decrease of 10.0%.
- Cash flows from operating activities totaled NIS 256 million compared to a negative cash flow of NIS 24 million last year.
- The net debt as at June 30, 2012 totaled NIS 1,671 million (compared to NIS 1,463 million on December 31, 2011 and NIS 1,746 million on March 31, 2012).
Key data on the first half[1]
- Sales totaled NIS 4.0 billion (NIS 3.6 billion last year), an increase of 10.7%; organic sales excluding the effect of changes in exchange rates grew by 11.0%.
- Gross profit totaled NIS 1.4 billion (35.3% of sales) compared to NIS 1.3 billion last year (36.4% of sales), an increase of 5.1%.
- Operating profit totaled approximately NIS 293 million (7.3% of sales) compared to NIS 279 million last year (7.7% of sales), an increase of 5.2%.
- The growth in the non-GAAP operating profit was mainly due to the operating profit of Strauss Coffee (positive contribution of NIS 16 million), an increase in operating profit in Sabra (positive contribution of NIS 11 million), and growth in the activity of the Fun & Indulgence segment (positive contribution of NIS 5 million). However, this growth was offset by the expenses of building the International Dips and Spreads business (Obela) outside of North America (negative contribution of NIS 9 million), a decrease in the results of the Health & Wellness segment (negative contribution of NIS 8 million), and by an increase in the operating loss of the "Other" segment (negative contribution of NIS 3 million), mainly as a result of the increase in operating expenses related to building the activity of Strauss Water in China and England.
- Net income attributed to the Company's shareholders totaled NIS 100 million compared to NIS 109 million last year, a decrease of 8.2%.
- Cash flows from operating activities totaled NIS 241 million compared to a negative cash flow of NIS 76 million in the corresponding period last year.
Key data on the first half and second quarter (based on non-GAAP management reports, in NISmillions)[1]:
First Half Second Quarter 2012 2011 % Chg 2012 2011 % Chg Sales 4,001 3,614 10.7 1,936 1,841 5.2 Gross profit - non-GAAP management reports 1,396 1,329 5.1 665 649 2.5 % of sales 34.9% 36.8% 34.3% 35.2% Operating profit - non-GAAP management reports 293 279 5.2 125 125 0.5 % of sales 7.3% 7.7% 6.4% 6.8% Income for the period - non-GAAP management reports 142 151 (6.3) 58 58 (0.3) Attributable to: The Company's shareholders 100 109 (8.2) 35 39 (10.0)
The Group's Activity in Israel
The Strauss Group is the second-largest company in the Israeli food market and in the first half of 2012, according to StoreNext, held 12.2% of the total domestic retail food and beverage market (on a half-yearly average, in financial value terms). The Israeli market is the Group's home market, in which it is active in various categories.
The sales of the entire business of the Strauss Group in Israel include the Health & Wellness and Fun & Indulgence Divisions, the coffee business in Israel, Max Brenner in Israel and Strauss Water in Israel (Tami4).
In the first half of 2012 the Strauss Group's total sales in Israel amounted to NIS 2,034 million compared to NIS 1,962 million last year, an increase of 3.7%. In the second quarter the Group's total sales in Israel amounted to NIS 937 million compared to NIS 946 million last year, a decrease of 1.0%.
The Coffee Business
Sales
Sales by Strauss's coffee business in the first half of 2012 totaled NIS 2,032 million compared to NIS 1,755 million last year, an increase of 15.7%. After neutralizing the impact of exchange rates differentials, growth in the half amounted to 19.6%. Organic growth after neutralizing the impact of exchange rate differentials amounted to 17.6% in the reported period. Sales by the International Coffee segment were adversely affected by the significant weakening of most of the local currencies in relation to the shekel, particularly in the second quarter.
In the second quarter Strauss Coffee's sales totaled NIS 984 million compared to NIS 924 million last year, an increase of 6.3%. After neutralizing the impact of currency exchange rates, growth amounted to 12.3%. Organic growth after neutralizing the impact of exchange rate differentials amounted to 10.8%.
Sales growth in the second quarter was adversely affected by the significant weakening of most of the local currencies in relation to the shekel in the international coffee business. Sales by the International Coffee segment grew by 8.9%, but after neutralizing the impact of exchange rate differentials, sales grew by 16.3%.
Additionally, Israel Coffee sales in the second quarter decreased by 5.3%, mainly as a result of a seasonal drop in quantities which was more strongly expressed this year due to the timing of Passover. This year the holiday fell earlier, and this was reflected in an increase of 22% in sales in the first quarter. In the first half of 2012, in which the influence of the timing of the holiday is neutralized, Israel Coffee posted a strong growth of 9.5% in sales.
Gross profit
In the first half gross profit in the coffee business totaled NIS 570 million (28.1% of sales) compared to NIS 547 million (31.2%) last year, an increase of 4.1%. The improvement in gross profit was the result of the growth in sales, which was partly offset by the increase in the prices of the Coffee Company's raw materials (inter alia, as a result of the significant weakening of most of the local currencies versus the dollar) and the increase in other production costs.
In the second quarter gross profit amounted to NIS 266 million (27.0% of sales) compared to NIS 269 million (29.1%) last year, a decrease of 1.3%. The decrease in gross profit is mainly the result of the significant weakening of the most of the local currencies in relation to the dollar in the international coffee business.
The gross profit rate dropped in the first half and in the second quarter following a considerable increase in raw material costs (mainly green coffee), and a further increase in other production costs, including wages, compared to the corresponding period last year.
As a rule, the price of green coffee in Strauss Coffee's cost of sales reflects the price levels of Arabica on the New York Board of Trade and of Robusta on the Euronext Liffe exchange in London after an interval of about three to six months. Additionally, as Strauss Coffee's companies in CEE and in Israel buy green coffee in dollars, the effective price paid by Strauss Coffee is influenced by volatility in the local currencies versus the dollar. In Brazil, coffee is purchased in Brazilian reals, but the price of green coffee in Brazil is indirectly influenced, inter alia, by the dollar-real exchange rate (given that all other factors are constant, the strengthening of the dollar indirectly causes the price of green coffee in Brazil to rise).
Accordingly, the weakening of the local currencies in relation to the dollar in CEE, Israel and Brazil contributed to the increase in the effective price of green coffee paid by Strauss Coffee.
Income and expenses in respect of the revaluation of foreign currency positions as a result of changes in exchange rates are allocated to financing and not to the cost of sales.
Operating profit
In the first half, the operating profit of the coffee business totaled NIS 135 million (6.6% of sales) compared to NIS 119 million (6.8% of sales) last year, an increase of 13.0%. The erosion of the operating profitability versus the corresponding period was mainly influenced by the erosion of gross margins.
In the second quarter the operating profit of the coffee business totaled NIS 58 million (5.8% of sales) compared to NIS 52 million (5.6% of sales) last year, an increase of 10.0%.
Activity in Israel
Sales
Strauss Israel's sales in the first half totaled NIS 1,455 million compared to NIS 1,411 million in the corresponding period last year, an increase of 3.2%. Growth was expressed in the sales of both activity segments, Health & Wellness (3.0%) and Fun & Indulgence (3.5%). Strauss Israel's sales grew by 3.3% in volume, expressed in most categories.
According to StoreNext figures, in the first half of 2012 the Israeli food and beverage market grew by 1.1% (in financial value). Strauss's market share of the total food and beverage market in Israel grew in the first half of 2012 and reached 12.2% compared to 12.0% in the corresponding half last year.
Israel sales in the second quarter totaled NIS 683 million, the same as last year. Strauss Israel's sales grew by 3.0% in volume, which was expressed in most categories. By contrast, the price reductions in June and October 2011 created a lower price platform compared to the corresponding quarter last year and offset almost the entire volume growth.
In the second quarter, Fun & Indulgence sales dropped by 6.3%. Most of the decrease is explained by a decrease in volumes in confectionery and bakery products related to the timing of Passover. In the first half of 2012, in which the timing of the holiday is neutralized, Fun & Indulgence sales grew by 3.5%.
According to StoreNext, in the second quarter of 2012 an anomalous negative growth of 1.7% was posted in the food and beverage market in Israel (in financial value). The decrease is mainly due to price reductions.
Strauss's market share of the total food and beverage market in the country continued to rise in the second quarter and reached 11.9%, compared to 11.8% in the corresponding quarter last year (market shares are affected by seasonality).
Gross profit
In the first half gross profit in the business in Israel increased by 1.1% and totaled NIS 574 million (39.4% of sales), compared to NIS 568 million in the corresponding period last year (40.2%).
The gross profit rate dropped due to an increase in Strauss Israel's effective cost platform compared to the first half last year: energy and water prices rose; wage costs increased, among other things due to the early implementation of raising the minimum wage; the prices of most raw materials rose (e.g. sugar, oil, milk powders and milk); as well as a negative currency effect (mainly the strengthening of the dollar); and an increase in costs due to regulation (the Sugar Law, Packaging Law).
Gross profit in the second quarter amounted to NIS 271 million (39.6% of sales) compared to NIS 266 million in the corresponding quarter last year (39.0%), an increase of 1.6%.
Operating profit
In the first half the operating profit in Israel amounted to NIS 155 million (10.7% of sales) compared to NIS 158 million in the corresponding period last year (11.2% of sales), a decrease of 2.0%. The decrease in the operating profit despite the increase in gross profit was mainly due to the increase in selling expenses compared to the corresponding half last year. The increase in selling expenses was primarily the result of an increase in distribution costs as a result of the volume growth in sales, and also of the increase in wage costs, among other things as a result of raising the minimum wage.
The operating profit in Israel decreased in the second quarter by 7.6% and amounted to NIS 63 million (9.2% of sales), compared to NIS 68 million last year (10.0% of sales). The decrease in the operating profit despite the increase in gross profit was mainly the result of the increase in selling and marketing expenses versus the corresponding period last year.
The International Dips and Spreads Activity (Executed by Sabra and Obela)
Sabra
Sabra's sales continue to grow along with its market shares, and it maintained a leading position in the refrigerated flavored spreads category and in the hummus category.
According to IRI, Sabra's market share in the twelve weeks ended on June 10, 2012 was 24.7% of the total refrigerated flavored spreads category (Number 1 in the market), 55.6% of the hummus category (Number 1 in the market), and 9.1% of the fresh salsa category (Number 3 in the market). Additionally, according to IRI Sabra led about 78% of the growth of the refrigerated flavored spreads category.
Following are selected financial data on Sabra's activity (reflecting 100%):
Sales
In the first half, Sabra's sales totaled NIS 478 million compared to NIS 373 million last year, an increase of 28.4%. Excluding the currency impact, growth amounted to 18.6%.
In the second quarter sales totaled NIS 254 million compared to NIS 201 million last year, an increase of 26.6%. Excluding the currency impact, growth amounted to 13.7%.
Operating profit
In the first half the non-GAAP operating profit totaled NIS 52 million (10.8% of sales) compared to NIS 30 million last year (7.9%), an increase of 74.5%.
In the second quarter the non-GAAP operating profit totaled NIS 38 million (14.9% of sales) compared to NIS 20 million last year (10.1%), an increase of 86.8%.
The growth in operating profit in the half and in the quarter is due to the growth in the production capacity utilization rate in Sabra's plants (mainly the plant in Virginia), and to the decrease in G&A expenses as a percentage of sales, made possible with the growth in sales.
Obela
Obela's activity was launched in Mexico in June 2012 with the opening of its new production facility, and it is expected to expand into additional countries in the future. Like Sabra's activity, Obela's activity is conducted through a joint venture of the Group and PepsiCo (each party holds 50%). Additionally, in the second quarter Obela acquired an existing refrigerated spreads business in Australia from PepsiCo, which Obela plans to develop in the future.
Following are selected financial data on Obela's activity (reflecting 100%):
Obela's sales began in the second quarter of 2012 and amounted to NIS 8 million. The non-GAAP operating loss totaled NIS 18 million and NIS 10 million in the first half and second quarter of the year, respectively.
Other Operations
In addition to the areas of activity described above, the Group has other businesses, which are included in the financial statements as the "Other Operations" segment. Following is a brief description of developments in these activities in the first half and second quarter of 2012:
- Strauss Water
In the first half Strauss Water's sales amounted to NIS 202 million compared to NIS 199 million last year, an increase of 1.6%.
In the second quarter sales amounted to NIS 103 million compared to NIS 100 million last year, an increase of 3.4%.
Max Brenner
In the first half of 2012 Max Brenner's sales totaled NIS 69 million compared to NIS 63 million last year, an increase of 9.4%. Excluding the impact of the erosion of the dollar in relation to the shekel, sales in the half compared to the corresponding period last year increased by 4.7%.
In the second quarter of the year Max Brenner's sales totaled NIS 34 million compared to NIS 33 million last year, an increase of 2.3%. Excluding the impact of the strengthening of the dollar in relation to the shekel, sales in the quarter decreased by 4.1%.
As at the date of the report, 42 Max Brenner Chocolate Bars are in operation around the world: 6 in Israel, 4 in the USA, 1 in the Philippines, 3 in Singapore and 28 in Australia (in May, another store was opened under a franchise in Australia). Nine branches are owned by the Company (in Israel and the USA), and all other branches are operated under franchise.
The Company continues to invest in the development of core infrastructure for the Max Brenner business in Israel and abroad, and in the course of 2012 plans to open additional branches.
Analysis of the Business Results of the Group
Sales
In the first half of 2012 the Group's sales amounted to NIS 4,001 million compared to NIS 3,614 million last year, an increase of 10.7%. Organic growth in the first half excluding the impact of changes in exchange rates amounted to 11.0%. Growth was evident mainly in the activity of the Coffee Company, which grew by 15.7% in the reported period; in Sabra's activity, which grew by 28.4%; in the activity of Strauss Israel, which grew by 3.2%; and in Max Brenner's activity, which grew by 9.4%.
In the second quarter the Group's sales amounted to NIS 1,936 million compared to NIS 1,841 million last year, an increase of 5.2%. Organic growth in the second quarter excluding the impact of changes in exchange rates amounted to 6.5%. Growth in the quarter was evident mainly in the activity of the Coffee Company, which grew by 6.3%, and in Sabra's activity, which grew by 26.6%.
Further explanations regarding the Group's sales in the first half and second quarter are included in the chapter "Analysis of the Business Results of the Group's Major Business Units".
Gross Profit
Gross profit (GAAP) in the first half of the year grew by 7.4% and totaled NIS 1,412 million compared to NIS 1,315 million in the corresponding period last year, and its rate decreased from 36.4% last year to 35.3% this year.
Gross profit (non-GAAP) in the first half grew by 5.1% and totaled NIS 1,396 million compared to NIS 1,329 million in the corresponding period last year, and its rate decreased from 36.8% last year to 34.9% this year.
Gross profit (GAAP) in the second quarter grew by 4.4% and totaled NIS 679 million compared to NIS 651 million in the corresponding quarter last year, and its rate decreased from 35.3% last year to 35.1% this year.
Gross profit (non-GAAP) in the quarter amounted to NIS 665 million compared to NIS 649 million last year, an increase of 2.5%. The gross profit rate decreased from 35.2% to 34.3%.
Further explanations regarding the Group's gross profit in the first half and second quarter are included in the chapter "Analysis of the Business Results of the Group's Major Business Units".
Operating Profit before Other Income (Expenses)
Operating profit (before other income and expenses (GAAP)) totaled NIS 300 million (7.5% of sales) in the first half of 2012 compared to NIS 248 million (6.9%) last year, an increase of 20.7%.
Operating profit (non-GAAP) totaled NIS 293 million (7.3% of sales) in the first half compared to NIS 279 million (7.7%) last year, an increase of 5.2%. The increase in the non-GAAP operating profit is mainly due to an improvement in the operating profit of Strauss Coffee (positive contribution of NIS 16 million), growth in the non-GAAP operating profit of Sabra (positive contribution of NIS 11 million), and growth in the activity of the Fun & Indulgence segment (positive contribution of NIS 5 million). By contrast, this increase was offset by the expenses of building the International Dips and Spreads activity (Obela) outside of North America (negative contribution of NIS 9 million), a decrease in the results of the Health & Wellness segment (negative contribution of NIS 8 million), and an increase in the operating loss of the Other segment, mainly due to the increase in operating expenses relating to building the activity of Strauss Water in China and England (negative contribution of NIS 3 million).
Operating profit (before other income and expenses (GAAP)) in the second quarter totaled NIS 134 million (6.9% of sales) compared to NIS 115 million (6.3%) last year, an increase of 16.0%.
Operating profit (non-GAAP) in the second quarter totaled approximately NIS 125 million (6.4% of sales) compared to a similar amount of approximately NIS 125 million (6.8%) last year. The non-GAAP operating profit in the second quarter was positively affected by the growth in the non-GAAP operating profit in the International Coffee segment (positive contribution of NIS 9 million) and by the growth in Sabra's operating profit (positive contribution of NIS 9 million). By contrast, the increase was offset by operating expenses related to building the International Dips and Spreads activity (Obela) outside of North America (negative contribution of NIS 5 million), an increase in the operating loss of the Other segment, mainly due to the increase in operating expenses related to building the activity of Strauss Water in China and England (negative contribution of NIS 4 million), a decrease in the results of the Health & Wellness segment (negative contribution of NIS 3 million), a decrease in the Fun & Indulgence segment (negative contribution of NIS 2 million), and a decrease in the operating profit of the Israel Coffee segment (negative contribution of NIS 3 million).
Other Expenses, Net
Other expenses, net totaled NIS 8 million in the first half compared to other expenses, net of NIS 6 million in the corresponding period last year.
In the second quarter other income, net amounted to NIS 1 million compared to other expenses, net of NIS 4 million in the corresponding period last year.
Operating Profit after Other Expenses
The Company's consolidated operating profit (GAAP) in the first half of 2012 totaled NIS 292 million compared to NIS 242 million last year, an increase of 20.4%.
In the second quarter the Company's consolidated operating profit totaled NIS 135 million compared to NIS 111 million last year, an increase of 21.7%.
Financing Expenses, Net
Financing expenses in the first half of 2012 totaled approximately NIS 68 million compared to a similar expense of approximately NIS 68 million in the corresponding period last year. Net financing expenses remained unchanged compared to the first half last year in spite of the increase in the net credit volume and average loan life, for the following main reasons:
- In the corresponding period last year, financing expenses included expenses in respect of the revaluation of foreign currency positions due to the strengthening of the Group's operating currencies versus the dollar.
- The Consumer Price Index (on the basis of the known Index) to which the Debentures Series B and other loans are linked rose by 1.3% in the first half of 2012, compared to an increase of 2.2% in the corresponding period last year. However, the increase in the volume of Index-linked liabilities and expenses due to the revaluation of Index transaction derivatives this year versus income from revaluation in the corresponding period last year contributed to a similar net effect on financing expenses.
Financing expenses in the second quarter totaled NIS 28 million compared to NIS 42 million last year. The main factors that contributed to the decrease in financing expenses were income entered in the quarter in respect of the revaluation of foreign currency positions due to the significant strengthening of the dollar versus the Group's operating currencies, as opposed to a weakening in the corresponding period last year, and expenses relating to interest transactions which were included in the corresponding quarter last year. By contrast, the decrease was partially offset mainly as a result of the increase in average loan life, and as a result of the entry of the expenses of the revaluation of Index transactions in the quarter. The Consumer Price Index (on the basis of the known Index) to which the Debentures Series B and other loans are linked rose by 1.3% in the quarter, similar to the corresponding quarter last year.
Net credit as at June 30, 2012 totaled NIS 1,671 million compared to NIS 1,614 million on June 30, 2011 and NIS 1,463 million on December 31, 2011.
Income before Taxes on Income
In the first half the Group's consolidated income before taxes on income amounted to NIS 224 million (5.6% of sales) compared to a profit of NIS 174 million (4.8% of sales) in the corresponding period last year, an increase of 28.2%.
In the second quarter the Group's consolidated income before taxes on income amounted to NIS 107 million (5.5% of sales) compared to a profit of NIS 69 million (3.8% of sales) in the corresponding quarter last year, an increase of 53.3%.
Taxes on Income
In the first half taxes on income amounted to NIS 84 million, reflecting an effective tax rate of 37.7%, whereas last year taxes on income amounted to NIS 57 million and the effective tax rate was 32.9%.
In the second quarter taxes on income amounted to NIS 41 million, reflecting an effective tax rate of 38.4%, compared to NIS 26 million in taxes last year and an effective tax rate of 37.5%.
The increase in the effective tax rate in the half and quarter is mainly due to a different mix of the pre-tax profit between the different countries, which is taxed at different rates and affects the weighted tax expenses, and to losses in countries where the Group is developing new businesses, which cannot be set off against profits from other businesses.
Income for the Period
Income for the period (GAAP) in the first half totaled NIS 140 million compared to NIS 117 million last year, an increase of 19.1%.
Income for the period (non-GAAP) in the first half amounted to NIS 142 million compared to NIS 151 million last year, a decrease of 6.3%.
In the second quarter income for the period (GAAP) totaled NIS 66 million compared to NIS 43 million last year, an increase of 50.6%.
Income for the period (non-GAAP) in the second quarter totaled approximately NIS 58 million compared to approximately NIS 58 million last year, a decrease of 0.3%.
Income for the Period Attributed to the Company's Shareholders
Income attributed to the Company's shareholders (GAAP) in the first half totaled NIS 98 million compared to NIS 81 million last year, an increase of 21.4%.
Income attributed to the Company's shareholders (non-GAAP) in the first half totaled NIS 100 million (2.5% of sales) compared to NIS 109 million last year (3.0%), a decrease of 8.2%.
In the second quarter income attributed to the Company's shareholders (GAAP) totaled NIS 41 million compared to NIS 26 million in the corresponding period last year, an increase of 57.9%.
Income attributed to the Company's shareholders (non-GAAP) in the second quarter totaled NIS 35 million (1.8% of sales) compared to NIS 39 million last year (2.1%), a decrease of 10.0%.
Income for the Period Attributed to Non-Controlling Interests
In the first half the share of non-controlling interests in the income of subsidiaries (GAAP) totaled NIS 42 million compared to NIS 36 million in the corresponding period last year, an increase of 14.0%.
In the second quarter the share of non-controlling interests in the income of subsidiaries (GAAP) totaled NIS 25 million compared to NIS 17 million in the corresponding quarter last year, an increase of 35.7%.
Following are the condensed financial accounting statements of income (GAAP) for the quarter and the half ended June 30, 2012 and 2011 (in NIS millions):
First Half Second Quarter 2012 2011 % Chg 2012 2011 % Chg Sales 4,001 3,614 10.7 1,936 1,841 5.2 Cost of sales excluding impact of commodities hedging transactions 2,605 2,285 14.0 1,271 1,192 6.6 Valuation of balance of commodities hedging transactions as at end of period (16) 14 (14) (2) Cost of sales 2,589 2,299 12.6 1,257 1,190 5.6 Gross profit 1,412 1,315 7.4 679 651 4.4 % of sales 35.3% 36.4% 35.1% 35.3% Selling and marketing expenses 897 846 6.1 441 421 5.1 General and administrative expenses 215 221 (2.6) 104 115 (10.0) Operating profit before other expenses 300 248 20.7 134 115 16.0 % of sales 7.5% 6.9% 6.9% 6.3% Other income (expenses), net (8) (6) 33.6 1 (4) (112.4) Operating profit 292 242 20.4 135 111 21.7 Financing expenses, net (68) (68) 0.2 (28) (42) (31.9) Income before taxes on income 224 174 28.2 107 69 53.3 Taxes on income (84) (57) 46.8 (41) (26) 56.8 Effective tax rate 37.7% 32.9% 38.4% 37.5% Income for the period 140 117 19.1 66 43 50.6 Attributable to: The Company's shareholders 98 81 21.4 41 26 57.9 Non-controlling interests 42 36 14.0 25 17 35.7
* Financial data were rounded off to NIS millions. The percentages change were calculated on the basis of the exact figures in NIS thousands
Following are the adjustments to the Company's non-GAAP management reports (NIS millions):
First Half Second Quarter 2012 2011 % Chg 2012 2011 % Chg Operating profit - GAAP - after other income (expenses) 292 242 20.4 135 111 21.7 Share-based payment and one-time bonus 9 17 5 12 Valuation of balance of commodities hedging transactions as at end of period (16) 14 (14) (2) Other expenses (income) 8 6 (1) 4 Operating profit - non-GAAP management reports 293 279 5.2 125 125 0.5 Financing expenses, net (68) (68) (28) (42) Taxes on income (84) (57) (41) (26) Taxes in respect of adjustments to the above non-GAAP management operating profit 1 (3) 2 1 Income for the period - non-GAAP management reports 142 151 (6.3) 58 58 (0.3)
Following are the condensed results of business operations (based on non-GAAP management reports) for the quarter and the half ended June 30, 2012 and 2011 (in NIS millions):
First Half Second Quarter 2012 2011 % Chg 2012 2011 % Chg Sales 4,001 3,614 10.7 1,936 1,841 5.2 Cost of sales 2,605 2,285 14.0 1,271 1,192 6.6 Gross profit - non-GAAP management reports 1,396 1,329 5.1 665 649 2.5 % of sales 34.9% 36.8% 34.3% 35.2% Selling and marketing expenses 897 846 6.1 441 421 5.1 General and administrative expenses 206 204 1.1 99 103 (4.3) Operating profit - non-GAAP management reports 293 279 5.2 125 125 0.5 % of sales 7.3% 7.7% 6.5% 6.8% Financing expenses, net (68) (68) 0.2 (28) (42) (33.6) Income before taxes on income 225 211 6.4 97 83 16.5 Taxes on income (83) (60) 37.8 (39) (25) 54.0 Income for the period - non-GAAP management reports 142 151 (6.3) 58 58 (0.3) Attributable to: The Company's shareholders 100 109 (8.2) 35 39 (10.0) Non-controlling interests 42 42 (1.4) 23 19 14.1
Following are the condensed results of business operations (based on non-GAAP management reports) of the major business sectors for the quarter and the half ended June 30, 2012 and 2011 (in NIS millions):
First Half Second Quarter 2012 2011 % Chg 2012 2011 % Chg Israel Net sales 1,455 1,411 3.2 683 683 0.1 Operating profit 155 158 (2.0) 63 68 (7.6) Coffee Net sales 2,032 1,755 15.7 984 924 6.3 Operating profit 135 119 13.0 58 52 10.0 International Dips and Spreads Net sales 243 186 30.5 131 100 30.4 Operating profit 17 13 37.5 14 11 35.4 Other Net sales 271 262 3.5 138 134 3.1 Operating profit (loss) (14) (11) 30.3 (10) (6) 67.2 Total Net sales 4,001 3,614 10.7 1,936 1,841 5.2 Operating profit 293 279 4.8 125 125 0.5
Following are the condensed results of business operations (based on non-GAAP management reports) of the Coffee Company by reported sectors for the quarter and the half ended June 30, 2012 and 2011 (in NIS millions):
First Half Second Quarter 2012 2011 % Chg 2012 2011 % Chg Israel Coffee segment Net sales 336 334 9.5 146 154 (5.3) Operating profit 44 41 4.7 14 17 (27.0) % profit 11.7% 12.2% 8.5% 11.1% International Coffee segment Net sales 1,666 1,421 17.2 838 770 8.9 Operating profit 91 78 16.7 44 35 26.7 % profit 5.5% 5.5% 5.3% 4.5% Total Coffee Net sales 2,032 1,755 15.7 984 924 6.3 Operating profit 135 119 13.0 58 52 10.0 % profit 6.6% 6.8% 5.8% 5.6%
Following are the condensed results of business operations based on non-GAAP management reports of Strauss Israel by activity segments, for the quarter and the half ended June 30, 2012 and 2011 (in NIS millions):
First Half Second Quarter 2012 2011 % Chg 2012 2011 % Chg Health & Wellness segment Net sales 942 915 3.0 487 474 2.9 Operating profit 91 99 (7.7) 54 57 (4.8) % profit 9.7% 10.8% 11.1% 11.9% Fun & Indulgence segment Net sales 513 496 3.5 196 209 (6.3) Operating profit 64 59 7.5 9 11 (21.7) % profit 12.5% 12.0% 4.6% 5.5% Total Israel Net sales 1,455 1,411 3.2 683 683 0.1 Operating profit 155 158 (2.0) 63 68 (7.6) % profit 10.7% 11.2% 9.2% 10.0%
1. Non-GAAP data in the quarter and the half do not include share-based payment, valuation of the balance of commodities hedging transactions as at end of period and other income and expenses.
For further information:
Talia Sessler
Investor Relations Director
Strauss Group Ltd.
Tel. 972-3-6752545
Mobile: 972-54-5772195
Email: [email protected]
http://www.strauss-group.com
Mirit Cohen
Spokesperson
Strauss Group Ltd.
Tel. 972-3-6752150
Mobile: 972-54-5772929
Email: [email protected]
http://www.strauss-group.com
SOURCE The Strauss Group
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