Food Business News - December 4, 2012 - (Page 14)

Single-serve packs propel Green Mountain earnings During a conference call with financial analysts on Nov. 27, Lawrence J. Blanford, president and chief executive officer, addressed the performance of the company’s single-serve packs. He noted that in September two of the company’s patents associated with K-Cup packs expired and there was concern within the investment community that G.M.C.R.’s position in the market would be diluted due to increased competition. “Last quarter, we discussed our expectations for our addressable U.S. brewer opportunity and the potential impact of nonlicensed single-serve packs both brand name and store brand on our business,” he said. “Since then, we have seen new single-serve pack entrants and new single-serve brewer entrants. But to date, we have seen nothing that causes us to change our expectations. On the contrary, there have been developments both internally and externally that have left us with more confidence in our outlook than just one quarter ago.” Mr. Blanford said G.M.C.R. has continued to innovate the category with the introduction of its Wellness Brewed collection, the addition of Snapple and Kirkland brands to G.M.C.R.’s roster of partners, and the launch of Eight O’Clock coffee in the grocery channel. “With 32 brands and more than 200 varieties at a range of price points and growing, we are confident that consumers will continue to find the choice and variety, along with the quality and performance they’ve come to expect in licensed products with the official Keurig Brewed seal,” he said. He added it is his belief that G.M.C.R.’s manufacturing expertise and scale will continue to give the company an advantage in the marketplace. “…We continue to invest in our equipment, continue to work on increasing efficiencies in throughputs and quality,” he said. “So, the scale required to serve this business, that’s continuing to grow significantly, certainly is a factor in our competitive position. I would also say it’s not necessarily as easy to produce these portion packs as it may appear.” Fourth-quarter net income rose to $92,035,000, or 59c per share, and an increase compared with 2011 when the company earned $75,821,000, or 49c per share. Sales for the fiscal 2012 fourth quarter were $946,736,000 compared with $711,883,000 during the previous year. FBN Green Mountain appoints new chief executive WATERBURY, VT. — Brian Kelley has been named president and chief executive officer of Green Mountain Coffee Roasters. He replaces Lawrence J. Blanford, who had been president and c.e.o. since 2007 and is retiring. Prior to joining Green Mountain, Mr. Kelley was chief product supply officer WATERBURY, VT. — Sales of single-serve packs for Green Mountain Coffee Roasters (G.M.C.R.) rose 59% during fiscal year 2012, ended Sept. 29, and provided ample support to drive the company’s earnings upward. For the year, G.M.C.R. recorded net income of $363,500,000, equal to $2.34 per share on the common stock, a significant increase compared with fiscal 2011 when the company earned $201,048,000, or $1.36 per share. Sales for the year rose 46% to $3,859,198,000, which compared with sales of $2,650,899,000 for the same period in 2011. The company noted a 53rd week in fiscal 2012 added approximately $90 million in net sales and approximately $11 million in net income, according to G.M.C.R. The company said approximately 90% of consolidated fiscal year 2012 net sales were from sales of Keurig Single Cup Brewers, single-serve packs, and Keurig-related accessories, with the remainder of net sales consisting primarily of sales of bagged coffee and sales from the office coffee services business. Sales of single-serve packs rose to $2,708.9 million in 2012 from $1,704 million in 2011. The billion dollar increase in single-serve pack net sales was driven by a 49% increase in sales volume; a 9% increase in K-Cup pack net price realization due primarily to price increases implemented during fiscal year 2011 to offset the then higher green coffee and other input costs; and, a 2% increase in K-Cup pack net sales due to the acquisition of Van Houtte, according to the company. The increases in single-serve pack net sales were offset by a 1% reduction due to singleserve pack product mix. Kelley for Coca-Cola Refreshments, Atlanta. In September he was named president of Coca-Cola Refreshments, but was not scheduled to step into that role until January 2013. “With leading consumer brands, compelling distribution and relationships, and an ongoing commitment to funding innovation to leverage its single-serve expertise, we knew that G.M.C.R.’s next leader had to possess a strong combination of operational expertise, consumer product and brand experience and strategic insight,” said Michael J. Mardy, interim chairman of the board of directors. “The board of directors conducted a thorough and robust search process which produced this outstanding leader who is ideally suited to lead G.M.C.R. as the company continues to grow and evolve.” FBN 14 FOODBUSINESS NEWS ® December 4, 2012

Table of Contents for the Digital Edition of Food Business News - December 4, 2012

Food Business News - December 4, 2012
Persistent ConAgra sees many Ralcorp benefits
F.D.A. suspends Sunland’s facility registration
Large potato crop pushing prices lower
Table of Contents
Web Contents
Editorial - In mourning there is a learning in demise
Researchers develop new nutrition scoring algorithm
Frozen foods remain a challenge for Heinz
Clean label confectionery products on the rise
Campbell Soup pursuing new consumers
Single-serve packs propel Green Mountain earnings
Green Mountain appoints new chief executive
Diamond Foods formally parts ways with ex-c.e.o.
Agropur to invest $100 million in cheese plant
Hormel cautiously hopeful about growth prospects
Added value at the heart of Tyson’s growth strategy
Food and beverage recalls jump 57%
Coca-Cola invests $1.3 billion in Chile
Washington - Greater organic oversight on the way
Ingredient Innovations - Positives in calorie subtraction
Stevia innovations lead to calorie reductions in beverages
Questions about calorie count for almonds, other nuts
Health and Wellness - Strengthening bones with additional nutrients
New Food Products
Ingredient Market Trends - U.S.D.A. forecasts record ag exports in fiscal 2013
Ingredient Markets
Supplier Innovations and News
Ad Index
Food Business in the News

Food Business News - December 4, 2012