Caribou earnings down; stock drops

by Staff
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MINNEAPOLIS — Ongoing commodity pressure crimped earnings at Caribou Coffee Company, Inc. in the first quarter of fiscal 2012. Net income in the quarter ended April 1 was $1,241,000, equal to 6c per share on the common stock, down sharply from $24,071,000, or $1.21 per share, in the first quarter of fiscal 2011. The year-ago period included a $21.3 million tax benefit related to the reversal of a tax valuation allowance.

Net sales for the first quarter increased 11% to $80,541,000 from $72,275,000. Coffeehouse sales rose 4% to $59,737,000 from $57,611,000, while commercial sales increased 50% to $17,500,000 from $11,700,000.

“As we had anticipated, our e.p.s. was slightly down versus the year-ago pro forma result due to ongoing commodity pressure expected in the first half of the year,” said Michael Tattersfield, president and chief executive officer. “Looking ahead, we are excited to be launching several high quality food and beverage products in our retail coffeehouses and we continue to expand our commercial and franchise segments.”

Mr. Tattersfield added that while the single-cup business continues to experience significant growth, “recent industry trends lead us to believe this business line will experience a moderation in its growth trajectory for the remainder of 2012.”

Caribou Coffee’s stock on the NASDAQ plunged Thursday to $13.99 per share from $15.91 per share after its partner in the single-serve coffee business, Green Mountain Coffee Roasters, cut its sales and profit outlook.

With the expected slowdown in the single-cup business, Mr. Tattersfield said Caribou in fiscal year 2012 now expects net sales growth of 6% to 8%, and earnings per share of 47c to 50c per share, which compared with earlier forecast sales growth of 10% and e.p.s. of 48c to 51c.

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