SunOpta Supports Hurricane Relief
TORONTO--Aug. 8, 2005--SunOpta Inc. (SunOpta or the Company) (Nasdaq:STKL) (TSX:SOY) today announced results for the three months and six months ended June 30, 2005. All amounts are expressed in U.S. dollars.
The Company achieved record revenues for the three months ended June 30, 2005, realizing its first quarter with revenues in excess of $100 million. Revenues in the quarter increased to $103 million from $81 million in the second quarter of the prior year, a 27.1% or $22 million increase. Revenue growth was led by a 29.1% increase in revenues within the Company's vertically integrated natural and organic food operations. The Company's revenue growth rate includes an internal growth rate of 12.8% and growth via acquisitions of 14.3%. For the six months ended June 30, 2005 revenues increased 31.8% to $189 million, compared to $143 million in the prior year.
Revenues in the second quarter exclude any significant contribution from the recently announced acquisitions, and therefore the Company fully expects future quarters to continue to exceed $100 million in revenues. Consequently, the Company is raising its revenue guidance for fiscal 2005 from $385 million to $415 million.
Net earnings after minority interest for the second quarter were $3,307,000 or $0.06 per diluted common share compared to $6,024,000 or $0.11 per diluted common share in the second quarter of the prior year. Earnings in the prior year included a one time award related to a legal settlement. Net earnings after minority interest for the six months ended June 30, 2005 were $9,912,000 or $0.17 per diluted common share compared to $7,894,000 or $0.14 per diluted common share in the prior year. Excluding one-time items in both years, net earnings per diluted common share for the six months ended June 30 were $0.10 in 2005 and $0.11 in 2004.
Net earnings in the second quarter and first six months of 2005 were assisted by strong demand for grain products, and in particular sunflower, and aseptically-packaged products including soy, rice and tea beverages. The shortfall in worldwide supply of sunflower has increased demand and margin for available product.
Net earnings in the quarter versus the prior period were negatively impacted by market issues in the Canadian Food Distribution Group. As previously disclosed, the Company's Distribution Group has encountered issues related to supply, freight, competition and integration in recent quarters and has been focused on addressing these issues. Demand for low-carb products peaked in the second quarter of 2004 and then declined, resulting in a significant downturn in the demand for oat fiber within the SunOpta Ingredients Group. The Company announced that it has implemented significant profit improvement plans in the second quarter, including expansion of its fiber portfolio, expansion of target markets, aggressive pursuit of international sales and cost reductions. These action plans are expected to improve results over the coming quarters.
Earlier today the Company confirmed the receipt of the first StakeTech Steam Explosion equipment contract with Abener Energia S.A. of Seville, Spain, a wholly-owned subsidiary of Abengoa S.A., for the first commercial production facility in the world to convert wheat straw into ethanol. This facility, which is scheduled to be operational in the fall of 2006, will be built in Babilafuente (Salamanca), Spain and is located adjacent to an existing cereal grain to ethanol plant operated by Abengoa. Abengoa is the largest ethanol producer in Europe and the second largest in the world.
Jeremy Kendall, Chairman and Chief Executive Officer of SunOpta stated that "We are pleased with our revenue growth and strategic direction of the Company, however, we are conscious of our need to improve margins in the near term, and with the implementation of profit improvement plans and our marketing strategies, we are confident about the future prospects of SunOpta."
SunOpta Inc. is an operator of high-growth ethical businesses, focusing on integrated business models in the natural and organic food markets. For the last seven consecutive years, SunOpta was included in Profit magazine's 'Profit 100' list of the 100 fastest growing companies in Canada. The Company has three business units: the SunOpta Food Group, which specializes in sourcing, processing and distribution of natural and organic food products integrated from seed through packaged products; the Opta Minerals Group, a producer, distributor, and recycler of environmentally friendly industrial materials; and the StakeTech Steam Explosion Group which engineers and markets proprietary steam explosion technology systems for the pulp, bio-fuel and food processing industries. Each of these business units has proprietary products and services that give it a solid competitive advantage in its sector.
For further information, please contact:
SunOpta Inc.
Jeremy N. Kendall, Chairman & CEO
Steve Bromley, President & COO
John Dietrich, Vice President & CFO
Susan Wiekenkamp, Information Officer
Tel: 905-455-2528, ext 103
swiekenkamp@sunopta.com
Website: www.sunopta.com
Note: This news release may contain forward-looking information. Actual future results may differ materially. The risks, uncertainties, and other factors that could influence actual results are described in the Company's annual report to shareholders and in SEC filings. The attached consolidated balance sheet and consolidated statement of earnings are unaudited. The information provided here should be considered in conjunction with the other information included within various SEC documents including Form 10Q reports filed during 2004 and Form 10K report filed March 16, 2005.
SunOpta Inc.
Condensed Consolidated Statements of Earnings
For the three months ended June 30, 2005 and 2004
Unaudited
(Expressed in thousands of U.S. dollars, except per share amounts)
----------------------------------------------------------------------
June 30, June 30, %
2005 2004 Change
$ $
----------------------------------------------------------------------
Revenues 102,858 80,946 27%
Cost of goods sold 84,352 64,690 30%
--------------------------
Gross profit 18,506 16,256 14%
Warehousing and distribution expenses 2,589 1,442 80%
Selling, general and administrative expenses 10,269 8,964 15%
--------------------------
Earnings before the following 5,648 5,850 (3%)
Interest expense, net (594) (135) 340%
Other income (expense) (203) 2,482
Foreign exchange 45 389 (88)%
--------------------------
(752) 2,736
--------------------------
Earnings before income taxes 4,896 8,586 (43%)
Provision for income taxes 1,354 2,562 (47%)
--------------------------
Net earnings before minority interest 3,542 6,024 (45%)
--------------------------
Minority interest 235 - -
--------------------------
Net earnings for the period 3,307 6,024 (45%)
--------------------------
Net earnings per share for the period
- Basic 0.06 0.11 (45%)
--------------------------
--------------------------
- Diluted 0.06 0.11 (45%)
--------------------------
--------------------------
SunOpta Inc.
Condensed Consolidated Statements of Earnings
For the six months ended June 30, 2005 and 2004
Unaudited
(Expressed in thousands of U.S. dollars, except per share amounts)
----------------------------------------------------------------------
June 30, June 30, %
2005 2004 Change
$ $
----------------------------------------------------------------------
Revenues 189,081 143,448 32%
Cost of goods sold 154,939 114,921 35%
---------------------------
Gross profit 34,142 28,527 20%
Warehousing and distribution expenses 5,193 2,598 100%
Selling, general and administrative
expenses 20,056 16,943 18%
---------------------------
Earnings before the following 8,893 8,986 (1%)
Interest expense, net (896) (343) 161%
Other income 3,832 2,367 62%
Foreign exchange 80 248 (68%)
---------------------------
3,016 2,272 33%
---------------------------
Earnings before income taxes 11,909 11,258 6%
Provision for income taxes 1,589 3,364 (53%)
---------------------------
Net earnings before minority interest 10,320 7,894 31%
---------------------------
Minority interest 408 - -
---------------------------
Net earnings for the period 9,912 7,894 26%
---------------------------
Net earnings per share for the period
- Basic 0.18 0.15 20%
---------------------------
---------------------------
- Diluted 0.17 0.14 21%
---------------------------
---------------------------
SunOpta Inc.
Condensed Consolidated Balance Sheets
As at June 30, 2005 and December 31, 2004
Unaudited
(Expressed in thousands of U.S. dollars, except per share amounts)
----------------------------------------------------------------------
June 30, December 31,
2005 2004
$ $
----------------------------------------------------------------------
Assets
Current assets
Cash and cash equivalents 7,699 8,081
Accounts receivable 50,736 38,446
Inventories 75,849 49,537
Prepaid expenses and other current assets 4,509 4,472
Current income taxes recoverable - 2,000
Deferred income taxes 421 421
-----------------------
139,214 102,957
Property, plant and equipment 73,431 62,619
Goodwill and intangibles 47,216 43,934
Deferred income taxes 6,177 6,831
Other assets 3,511 3,831
-----------------------
269,549 220,172
-----------------------
-----------------------
Liabilities
Current liabilities
Bank indebtedness 20,693 -
Accounts payable and accrued liabilities 44,765 35,668
Customer and other deposits 679 431
Current portion of long-term debt 6,775 4,819
Current portion of long-term payables 338 1,548
-----------------------
73,250 42,466
Long-term debt 33,015 31,003
Long-term payables 862 1,232
-----------------------
107,127 74,701
-----------------------
Minority interest 8,946 1,378
-----------------------
Shareholders' Equity
Capital stock 106,160 105,794
Contributed surplus 3,235 3,330
Retained earnings 36,733 26,821
Cumulative other comprehensive income 7,348 8,148
-----------------------
153,476 144,093
-----------------------
269,549 220,172
-----------------------
-----------------------
SunOpta Inc.
Condensed Notes to Consolidated Financial Statements
For the three and six months ended June 30, 2005
Unaudited
(Expressed in thousands of U.S. dollars, except per share and
share amounts)
Three months ended
June 30, 2005
-----------------------------------------
StakeTech
Steam
SunOpta Opta Explosion
Food Minerals Group and
Group Group Corporate Consolidated
$ $ $ $
-----------------------------------------
Total revenues to
external customers 92,555 9,839 464 102,858
-----------------------------------------
Segment earnings (loss)
before other income
(expense), interest
expense (net), income
taxes and minority
interest 5,054 1,621 (982) 5,693
-----------------------------------------
Other income (expense) - - (203) (203)
-----------------------------------------
Segment earnings (loss)
before interest
expense (net), income
taxes and minority
interest 5,054 1,621 (1,185) 5,490
-----------------------------------------
Interest expense, net - - 594 594
-----------------------------------------
Provision for income
taxes - - 1,354 1,354
-----------------------------------------
Minority interest - 235 - 235
-----------------------------------------
Net earnings (loss) 5,054 1,386 (3,133) 3,307
-----------------------------------------
The SunOpta Food Group has the following segmented reporting:
Three months ended
June 30, 2005
-----------------------------------------------------
Grains & Canadian
Soy SunOpta Packaged Food SunOpta
Products Ingredients Products Distribution Food
Group Group Group Group Group
$ $ $ $ $
----------------------------------------------------
Total
revenues
from
external
customers 27,779 24,878 13,176 26,722 92,555
----------------------------------------------------
Segment
earnings
before other
income
(expense),
interest
expense
(net),
income taxes
and minority
interest 2,283 1,651 508 612 5,054
----------------------------------------------------
Six months ended
June 30, 2005
------------------------------------------
StakeTech
Steam
SunOpta Opta Explosion
Food Minerals Group and
Group Group Corporate Consolidated
$ $ $ $
------------------------------------------
Total revenues to
external customers 170,760 17,577 744 189,081
------------------------------------------
Segment earnings (loss)
before other income
(expense), interest
expense (net) and
income taxes and
minority interest 8,397 2,458 (1,882) 8,973
------------------------------------------
Other income (expense) - - 3,832 3,832
------------------------------------------
Segment earnings
before interest
expense (net) , income
taxes and minority
interest 8,397 2,458 1,950 12,805
------------------------------------------
Interest expense, net - - 896 896
------------------------------------------
Provision for income
taxes - - 1,589 1,589
------------------------------------------
Minority interest 104 304 - 408
------------------------------------------
Net earnings (loss) 8,293 2,154 (535) 9,912
------------------------------------------
SunOpta Inc.
Condensed Notes to Consolidated Financial Statements
For the three and six months ended June 30, 2005
Unaudited
(Expressed in thousands of U.S. dollars, except per share and
share amounts)
The SunOpta Food Group has the following segmented reporting:
Six months ended
June 30, 2005
----------------------------------------------------
Grains & Canadian
Soy SunOpta Packaged Food SunOpta
Products Ingredients Products Distribution Food
Group Group Group Group Group
$ $ $ $ $
---------------------------------------------------
Total revenues
from external
customers 48,585 44,449 25,522 52,204 170,760
---------------------------------------------------
Segment
earnings
before other
income
(expense),
interest
expense (net)
and income
taxes 3,396 2,757 942 1,302 8,397
---------------------------------------------------
Three months ended
June 30, 2004
----------------------------------------------------
StakeTech
Steam
SunOpta Explosion
Food Opta Minerals Group and
Group Group Corporate Consolidated
$ $ $ $
----------------------------------------------------
Total
revenues to
external
customers 71,664 8,992 290 80,946
----------------------------------------------------
Segment
earnings
(loss)
before other
income
(expense),
interest
expense
(net), and
income taxes 5,542 1,716 (1,019) 6,239
----------------------------------------------------
Other income
(expense) - - 2,482 2,482
----------------------------------------------------
Segment
earnings
before
interest
expense
(net) and
income taxes 5,542 1,716 1,463 8,721
----------------------------------------------------
Interest
expense, net - - 135 135
----------------------------------------------------
Provision for
income taxes - - 2,562 2,562
----------------------------------------------------
Net earnings
(loss) 5,542 1,716 (1,234) 6,024
----------------------------------------------------
The SunOpta
Food Group
has the
following
segmented Three months ended
reporting: June 30, 2004
-----------------------------------------------------
Grains & Canadian
Soy SunOpta Packaged Food SunOpta
Products Ingredients Products Distribution Food
Group Group Group Group Group
$ $ $ $ $
----------------------------------------------------
Total
revenues
from
external
customers 24,630 16,688 10,943 19,403 71,664
--------------------- ------------------------------
Segment
earnings
before other
income
(expense),
interest
expense
(net) and
income taxes 1,366 2,262 493 1,421 5,542
--------------------- ------------------------------
SunOpta Inc.
Condensed Notes to Consolidated Financial Statements
For the three and six months ended June 30, 2005
Unaudited
(Expressed in thousands of U.S. dollars, except per share and
share amounts)
Six months ended
June 30, 2004
------------------------------------------
StakeTech
Steam
SunOpta Opta Explosion
Food Minerals Group and
Group Group Corporate Consolidated
$ $ $ $
------------------------------------------
Total revenues to
external customers 127,180 15,831 437 143,448
------------------------------------------
Segment earnings (loss)
before other income
(expense), interest
expense (net) and
income taxes 8,908 2,368 (2,042) 9,234
------------------------------------------
Other income (expense) - - 2,367 2,367
------------------------------------------
Segment earnings
before interest
expense (net) and
income taxes 8,908 2,368 325 11,601
------------------------------------------
Interest expense, net - - 343 343
------------------------------------------
Provision for income
taxes - - 3,364 3,364
------------------------------------------
Net earnings (loss) 8,908 2,368 (3,382) 7,894
------------------------------------------
The SunOpta Food Group
has the following
segmented reporting:
Six months ended
June 30, 2004
---------------------------------------------------
Grains & Canadian
Soy SunOpta Packaged Food SunOpta
Products Ingredients Products Distribution Food
Group Group Group Group Group
$ $ $ $ $
---------------------------------------------------
Total revenues
from external
customers 42,313 31,973 19,490 33,404 127,180
---------------------------------------------------
Segment
earnings
before other
income
(expense),
interest
expense (net)
and income
taxes 1,833 4,074 422 2,579 8,908
---------------------------------------------------
CONTACT: SunOpta Inc.
Jeremy N. Kendall, Steve Bromley, John Dietrich,
Susan Wiekenkamp, 905-455-2528 ext. 103
Email: swiekenkamp@sunopta.com
Website: www.sunopta.com
SOURCE: SunOpta Inc.