Cott Corp. announced its results for the second quarter ended July 2, 2011. Second quarter 2011 revenue was $640 million compared to $425 million. The Cliffstar business, which was acquired in the third quarter of 2010, contributed $162 million of the increase in revenue. Operating income increased 10 percent to $43 million. Excluding Cliffstar purchase accounting adjustments and integration expenses, adjusted operating income was $47 million. EBITDA was $67 million, compared to $54 million. Excluding Cliffstar purchase accounting adjustments and integration expenses, adjusted EBITDA was $66 million. Net income and earnings per diluted share were $27 million and $0.28, respectively, compared to $22 million and $0.28, respectively. Excluding Cliffstar purchase accounting adjustments and integration expenses, adjusted net income and adjusted earnings per diluted share were $30 million and $0.32, respectively, compared to $22 million and $0.28, respectively.
"Our second quarter results included volume and revenue growth both globally and in North America, Mexico and the U.K. During the quarter, we also realized additional tax benefits which we expect to be on-going and which positively impacted our financial results in the quarter," commented Jerry Fowden, Cott's chief executive officer in a prepared statement. "Despite continued commodity and fuel cost headwinds, we remain focused on delivering another year of significant cash generation," continued Mr. Fowden.
Filled beverage case volume increased 27 percent (9 percent excluding Cliffstar) driven by higher volumes in North America, Mexico and the United Kingdom / Europe ("U.K.").
Revenue increased 51 percent (9 percent excluding Cliffstar and the impact of foreign exchange). Increased revenues were driven by higher volumes in North America, Mexico and the U.K., which more than offset lower volumes in RCI during the quarter.
Gross profit as a percentage of revenue was 13.8 percent compared to 17.3 percent last year and 13.0 percent for the first quarter of 2011. The year-over-year decline in gross profit as a percentage of revenue was primarily attributable to the adverse impact of higher commodity and fuel costs.
Selling, general and administrative ("SG&A") expenses were $45 million compared to $35 million. Excluding Cliffstar and integration expenses, SG&A expenses were $37 million. The increase in SG&A excluding Cliffstar and integration expenses was driven by employee-related costs, information technology costs and professional fees.
Operating income increased 10 percent to $43 million. Excluding Cliffstar purchase accounting adjustments and integration expenses, adjusted operating income was $47 million.
EBITDA was $67 million compared to $54 million. Excluding Cliffstar purchase accounting adjustments and integration expenses, adjusted EBITDA was $66 million.
Cash provided by operating activities was $21 million and capital expenditures were $11 million.
North America filled beverage case volume increased 35 percent to 199 million cases (9% excluding Cliffstar). Revenue increased 63 percent to $491 million. Excluding the impact of the Cliffstar acquisition and foreign exchange, revenue increased 8% due to higher average prices offset by an adverse product mix. Operating income was $30 million.
U.K. filled beverage case volume increased 7 percent to 54 million cases. Revenue increased 25 percent to $126 million (15 percent excluding the impact of foreign exchange), driven by increased volumes and a continued favorable product mix. Revenue in the energy and sports isotonic categories increased 36 percent. Operating income was $11 million.
Mexico filled beverage case volume increased 17 percent to 12 million cases. Revenue increased 15 percent to $16 million (7% excluding the impact of foreign exchange).
RCI concentrate volume declined 33 percent to 62 million cases primarily due to the timing of shipments. Revenue declined 24 percent to $7 million. Operating income was $2.1 million.
