|Caribou Coffee Reports First Quarter 2011 Results|
MINNEAPOLIS, May 05, 2011 (BUSINESS WIRE) --
Caribou Coffee Company, Inc. (NASDAQ:CBOU), the second largest company-owned premium coffeehouse operator in the United States based on the number of coffeehouses, today reported financial results for the first quarter of 2011 (thirteen weeks ended April 3, 2011) and re-confirmed fiscal 2011 guidance.
HIGHLIGHTS FOR THE FIRST QUARTER OF 2011 INCLUDE:
Speaking on behalf of the Company, Michael Tattersfield, the Company's President and CEO commented, "Our financial performance during the recent quarter underscores our successful execution against our strategy of becoming a true multi-channel coffee company. We continue to see success across our three lines of business, each of which contributed significantly to our 8% growth in consolidated sales and earnings per share performance. As always, we are committed to enhancing returns for our shareholders while building the community place loved by our guests."
FIRST QUARTER 2011 RESULTS
Net sales for the quarter of $72.3 million increased $5.2 million, or 7.8%, from $67.1 million in the comparable quarter of 2010.
Cost of sales and related occupancy costs in the first quarter of 2011 were $33.2 million, an increase of $1.8 million or 5.9% compared to the first quarter of 2010, driven by the Company's consolidated sales growth. As a percentage of revenue, cost of sales and related occupancy costs were 46.0% in the first quarter of 2011 versus 46.8% in the first quarter of 2010. This decrease as a percentage of sales was due to pricing action taken in the quarter, as well as leveraging the Company's higher sales volume over fixed occupancy costs.
Operating expenses in the first quarter of 2011 rose $0.4 million or 1.8% to $25.4 million compared to $25.0 million in the same period of the prior year. The increase in operating expenses was related to variable costs related to increased sales in the quarter such as labor in the Company's retail coffeehouse channel. As a percentage of revenue, operating costs were 35.2%, down from 37.2% in the same period of the prior year, as the Company gained leverage on fixed costs within their business channels and benefitted from a shift in their overall sales mix to their commercial channel, which has a lower operating expense component than their retail coffeehouses.
General and administrative expenses increased $1.3 million, or 19.9%, to $7.8 million in the first quarter of 2011, from $6.5 million in the first quarter of 2010. As a percentage of total net sales, general and administrative expenses increased to 10.8% in the first quarter of 2011 from 9.7% in the first quarter of 2010. This increase was due to resources added in the latter half of 2010 to support key initiatives, including marketing, product management and real estate.
EBITDA was $6.2 million in the first quarter of 2011, compared to EBITDA of $4.6 million in the first quarter of 2010, an improvement of 35.0%. EBITDA increased primarily due to improved performance within the retail coffeehouses and continued growth in the commercial and franchise segments. (EBITDA is a non-GAAP measure. See EBITDA reconciliation at the end of this release).
Depreciation and amortization decreased $0.2 million to $2.9 million during the first quarter of 2011. Depreciation and amortization was lower in the quarter due to a lower depreciable asset base.
In the first quarter of 2011, the Company recorded a tax benefit of $21.3 million compared to a tax benefit of $0.2 million in first quarter of 2010. The tax benefit in 2011 related to the reversal of a portion of the Company's valuation allowance against accumulated net operating losses and other deferred tax assets and the corresponding recognition of those deferred tax assets on the Company's balance sheet.
The Company's net income attributable to Caribou Coffee Company, Inc. for the first quarter of 2011 was $24.1 million or $1.17 per diluted share compared to $1.0 million or $0.05 per diluted share for the same period in 2010.
The Company's non-GAAP pro forma net income attributable to Caribou Coffee Company, Inc. in the first quarter of 2011 was $1.6 million, or $0.08 per diluted share, compared to a pro forma net income of $0.5 million, or $0.03 per diluted share for the same period in 2010 (see non-GAAP reconciliation at the end of this release).
FISCAL 2011 OUTLOOK
Caribou Coffee also re-confirmed the following fiscal 2011 guidance:
Caribou Coffee will host a conference call on May 5, 2011, at 4:30 p.m. (Eastern Time) to discuss these results. Hosting the call will be Mike Tattersfield, Chief Executive Officer, and Tim Hennessy, Chief Financial Officer. The call will be webcast and can be accessed from the Company's website at www.cariboucoffee.com. The webcast link is in the Investor Relations section. Listeners may also access the call by dialing (800) 946-0709 or (719) 325-2320 for international callers. A replay of the call will be available until Thursday, May 12, 2011, by dialing (877) 870-5176 or (858) 384-5517 for international callers; the password is 2306179. In addition, the webcast will be archived on the Company's website.
PRESENTATION AT THE RW BAIRD 2011 GROWTH STOCK CONFERENCE
As a reminder, Caribou Coffee will present at the RW Baird 2011 Growth Stock Conference at The Four Seasons Hotel in Chicago, Illinois on Tuesday, May 10, 2011 at 10:15 a.m. (Eastern Time).
ABOUT THE COMPANY
Founded in 1992, Caribou Coffee Company is one of the leading branded coffee companies in the United States, with a compelling multi-channel approach to their customers. Based on the number of coffeehouses, Caribou Coffee is the second largest company-operated premium coffeehouse operator in the United States. As of April 3, 2011, the Company had 544 coffeehouses, including 135 franchised locations, in 20 states, the District of Columbia and nine international markets. The Company's coffeehouses aspire to be the community place loved by guests who are provided an extraordinary experience that makes their day better. Caribou Coffee provides the highest quality handcrafted beverages, foods and coffee lifestyle items with a unique blend of expertise, fun and authentic human connection in a comfortable and welcoming coffeehouse environment. In addition, Caribou Coffee's unique coffees are available within grocery stores, mass merchandisers, club stores, office coffee and foodservice providers, hotels, entertainment venues and e-commerce channels. Caribou Coffee is a proud recipient of the Rainforest Alliance Corporate Green Globe Award and is committed to operating practices that promote sustainability and environmental protection. For more information, visit the Caribou Coffee web site at www.cariboucoffee.com.
Certain statements in this release, and other written or oral statements made by or on behalf of Caribou Coffee are "forward-looking statements" within the meaning of the federal securities laws. Statements regarding future events and developments and our future performance, as well as management's current expectations, beliefs, plans, estimates or projections relating to the future, are forward-looking statements within the meaning of these laws. These forward-looking statements are subject to a number of risks and uncertainties. Among the important factors that could cause actual results to differ materially from those indicated by such forward-looking statements are: fluctuations in quarterly and annual results, incurrence of net losses, adverse effects of management focusing on implementation of a growth strategy, failure to develop and maintain the Caribou Coffee brand and other factors disclosed in the Company's filings with the Securities and Exchange Commission. The Company undertakes no obligation to update any forward-looking statements in order to reflect events or circumstances that may arise after the date of this release.
NON-GAAP FINANCIAL INFORMATION
The following reconciliation and non-GAAP financial information are provided to assist the reader with understanding the financial impact of the reversal of the valuation allowance against accumulated net operating losses and other deferred tax assets on the Company's net income attributable to Caribou Coffee Company, Inc. and earnings per share when comparing current quarter results to the Company's 2010 first quarter results.
EBITDA is equal to net income excluding: (a) interest expense; (b) interest income; (c) depreciation and amortization; and (d) income taxes.
Management believes EBITDA is useful to investors in evaluating the Company's operating performance for the following reason:
Management uses EBITDA:
EBITDA as calculated by Caribou Coffee is not necessarily comparable to similarly titled measures used by other companies. In addition, EBITDA: (a) does not represent net income or cash flows from operating activities as defined by GAAP; (b) is not necessarily indicative of cash available to fund cash flow needs; and (c) should not be considered an alternative to net income, operating income, cash flows from operating activities or Caribou Coffee's other financial information as determined under GAAP.
SOURCE: Caribou Coffee Company, Inc.
For Caribou Coffee Company, Inc.
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