DALLAS–(BUSINESS WIRE)–Feb. 15, 2000–Suiza Foods Corporation (NYSE:SZA), the nation’s leading dairy processor and distributor, today announced sales for the year ended December 31, 1999 of $4.5 billion, up 35% from $3.3 billion in 1998. Excluding the effects of the sale of the company’s U.S. packaging business in July 1999, the company increased sales for the year by 45%.
Net income from continuing operations in 1999, excluding non-recurring items, grew 16.6% to $119.9 million from $102.8 million in the prior year, and diluted earnings per share rose 16.2% to $3.37 for the year compared with $2.90 in 1998. Net income for the year, after non-recurring items, totaled $109.7 million, or $3.13 per diluted share. Diluted cash earnings per share, excluding non-recurring items and goodwill amortization, totaled $3.92, representing growth of 16.7% over $3.36 in 1998.
“We are pleased with our solid performance for the year and in the quarter, as we continued to integrate acquisitions and improve operational performance,” said Gregg Engles, Chairman and Chief Executive Officer of Suiza Foods. “We look forward to an exciting year in 2000 now that we have gained a national presence with our acquisition of Southern Foods. That national presence, combined with our ability to deliver quality products, excellent customer service, and innovation in the dairy category will allow us to better align ourselves with our customers, who are also consolidating.”
FOURTH QUARTER RESULTS
Sales for the fourth quarter of 1999 grew 13.7% to $1.1 billion, compared with $991.6 million in the fourth quarter of 1998. Excluding the effect of the U.S. packaging business sale, the company recorded revenue growth of 27%.
Fourth quarter diluted earnings per share before non-recurring items increased 19.7% to $0.91 per share from $0.76 per share in the 1998 fourth quarter, and diluted cash earnings per share rose 19.1% to $1.06. Net income before non-recurring items increased 12.3% to $30.4 million compared with $27.1 million in the prior-year fourth quarter.
The company reported operating income excluding non-recurring items and the effect of the sale of the U.S. packaging business for the quarter of $70.7 million, or 6.3% of sales, compared with $49.5 million, or 5.6% of sales, in the 1998 fourth quarter.
Fourth quarter operating margins for dairies owned by Suiza for more than 12 months were 9.1%, a 180 basis point improvement over the prior-year period, driven primarily by lower raw milk prices, growth in margins at the Morningstar subsidiary and synergies related to plant closures and other consolidation activities.
Non-recurring items related to plant closings, severance payments and the company’s share of restructuring charges taken by Consolidated Container totaled $7.8 million during the quarter.
During the fourth quarter, Suiza repurchased approximately $128 million, or 3.5 million shares, of common stock under its open market share repurchase program. To date in 2000, the company has bought back an additional $12.8 million, or 317,500 shares.
RECENT DEVELOPMENTS
Since the end of the fourth quarter, Suiza:
- Completed the acquisition of Southern Foods Group L.P., making Suiza the nation’s first dairy company with national reach
- Completed the acquisition of Valley of Virginia, an agricultural marketing cooperative with dairy processing plants in Springfield, Virginia and Mt. Crawford, Virginia
- Expanded the test market for three new branded milks,
kidsmilk™, fitmilk™, and lifemilk™, targeted toward
specific segments of milk-drinkers, into New England and
Michigan - Introduced Sun Soy(TM), a non-dairy, lactose-free,
cholesterol-free milk made from soy and enriched with calcium and
vitamins A, B12, D and E, through its Morningstar subsidiary - Entered into a long-term supply agreement to provide all
private-label milk and related dairy products to Stop & Shop
stores, the largest grocery store operator in New England Suiza Foods Corporation is the nation’s leading dairy processor and distributor, producing a full line of company-branded and customer-branded products. Suiza sells its dairy products under various brands including national brands (such as International Delight®, Second Nature®, Naturally Yours®, Mocha Mix®, Sun Soy™, kidsmilk™, fitmilk™, and lifemilk™), strong regional brands (such as Adohr Farms®, Barbe’s®, Brown’s Velvet Dairy®, Broughton®, Country Fresh®, Dairymens®, Lehigh Valley Farms®, London’s®, Meadow Gold®, Model Dairy(TM), Natural by Garelick Farms®, Oak Farms®, Robinson®, Schepps®, Suiza(TM), Louis Trauth™, Tuscan®, Velda Farms® and West Lynn Creamery®) and partner or licensed brands in certain regions (including Borden®, Lactaid®, Flav-O-Rich®, Foremost®, and Pet®). Suiza also has holdings in the consumer goods packaging industry.
The company’s earnings conference call will be held at 10:00 a.m. E.S.T. today. You may listen to the call live at the company’s web site at www.suizafoods.com. You will need Real Audio software, which may be downloaded by going to the Suiza site prior to the call. It takes approximately 15 minutes to download the software. Replays will be available at the same address for a limited time period.
SUIZA FOODS CORPORATION
(Dollars in thousands, except per share data)
Three months ended Twelve months ended
December 31, December 31,
------------------ -------------------
1999 1998 1999 1998
---- ----- ---- ----
Net sales $1,127,910 $ 991,595 $4,481,999 $3,320,940
Cost of sales 876,144 772,238 3,487,075 2,557,908
---------- --------- ---------- ----------
Gross profit 251,766 219,357 994,924 763,032
Operating costs and
expenses 181,083 152,133 705,484 520,576
Plant closing and
other costs 4,375 0 12,566 0
---------- --------- ---------- ----------
Operating income 66,308 67,224 276,874 242,456
Interest expense &
financing charges on
preferred securities 19,267 25,803 87,817 82,295
Consolidated Container
equity interest earnings (1,330) (7,578)
Consolidated Container
plant closing charges 3,391 4,948
Other (income) expense (1,699) (1,928) (1,416) (4,290)
---------- --------- ---------- ----------
Income from continuing
operations 46,679 43,349 193,103 164,451
Income taxes 19,001 15,845 75,463 59,823
Minority interest 2,320 431 8,813 1,559
---------- --------- ---------- ----------
Net income from
continuing operations $ 25,358 $ 27,073 $ 108,827 $ 103,069
========== ========= ========== ==========
Net income applicable
to common stockholders $ 26,262 $ 27,073 $ 109,731 $ 131,369
========== ========= ========== ==========
Net income applicable
to common
stockholders before
nonrecurring items $ 30,404 $ 27,073 $ 119,891 $ 102,832
========== ========= ========== ==========
Diluted EPS before
nonrecurring items $ 0.91 $ 0.76 $ 3.37 $ 2.90
========== ========= ========== ==========
Basic earnings per share:
Income from continuing
operations $ 0.83 $ 0.81 $ 3.31 $ 3.12
Net income 0.86 0.81 3.34 3.98
Basic average common
shares (000's) 30,433 33,549 32,861 32,953
Diluted earnings per share:
Income from continuing
operations $ 0.78 $ 0.76 $ 3.11 $ 2.90
Net income 0.80 0.76 3.13 3.58
Diluted average common
shares (000's) 40,324 43,793 42,858 41,966
Summary Financial Information:
Depreciation $ 17,223 $ 17,845 $ 77,205 $ 59,323
Amortization $ 10,028 $ 9,676 $ 39,403 $ 32,456
SUIZA FOODS CORPORATION
Condensed Balance Sheet
(in thousands)
December 31, December 31,
ASSETS 1999 1998
------ ----------- ----------
Cash and cash equivalents $ 25,155 $ 54,922
Other current assets 614,252 758,977
---------- ----------
Total current assets 639,407 813,899
Property, plant & equipment 758,485 846,956
Intangibles & other assets 1,261,030 1,352,928
---------- ----------
Total Assets $2,658,922 $3,013,783
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
------------------------------------
Total current liabilities $ 479,117 $ 559,071
Long term debt 689,397 893,077
Other long-term liabilities 81,181 93,151
Mandatorily redeemable TIPES 683,505 682,938
Minority interest in subsidiaries 141,750 129,775
Stockholders' equity:
Common stock 293 336
Additional paid-in capital 275,527 446,230
Retained earnings 314,589 204,859
Other comprehensive income (6,437) 4,346
---------- ----------
Total stockholders' equity 583,972 655,771
Total Liabilities and Stockholders Equity $2,658,922 $3,013,783
========== ==========
CONTACT:
Suiza Foods Corporation, Dallas
Cory Olson, 214/303-3645
All the latest from Dean Foods
