DALLAS–(BUSINESS WIRE)–May 4, 2000–Suiza Foods Corporation (NYSE:SZA), the nation’s leading dairy processor and distributor, today announced sales for the quarter ended March 31, 2000 of $1.4 billion, an increase of 20.9% over the same quarter last year.
Diluted earnings per share before non-recurring items totaled 71 cents compared with 60 cents last year. Excluding the effects of the sale of the company’s U.S. packaging business sold in July 1999, sales grew 35.0% and diluted earnings per share before non-recurring items increased 40.6% over the first quarter of 1999.
“We delivered excellent first quarter results, and we believe we’re off to a solid start for 2000,” said Gregg Engles, Chairman and Chief Executive Officer of Suiza Foods. “The effect of higher margin acquisitions, healthy volume growth and lower raw material costs impacted us positively this quarter as we maintained our focus on integrating acquisitions effectively and improving operational performance.”
First quarter diluted cash earnings per share before non-recurring items, which represents earnings per share before goodwill amortization, net of the related income tax effects, totaled 87 cents, an increase of 15.3% over 75 cents last year. Net income before non-recurring items for the first quarter grew 1.9% to $21.3 million from $20.9 million in the prior year. Excluding the U.S. packaging business and before non-recurring items, diluted cash earnings per share increased 33.4% and net income rose 21.9%.
Operating income before non-recurring items totaled $78.1 million, or 5.6% of sales, an improvement of 30 basis points over the first quarter of 1999. Excluding U.S. packaging, operating margins improved 130 basis points due to higher margins at dairies owned for more than 12 months, higher margin acquisitions and lower raw material costs.
During the quarter, the company recorded an extraordinary net gain of $5.0 million related to the payoff of its previous credit facility on January 4, 2000. Also in the quarter, the company recognized a non-recurring expense of $1.8 million related to plant closings.
RECENT DEVELOPMENTS
Most recently, Suiza has:
- Completed the acquisition of Leche Celta, the fourth
largest dairy in Spain, with sales of approximately $150
million in 1999. Given the mature, highly-fragmented
nature of the Spanish dairy industry, the acquisition
provides another platform for growth, improves alignment
with large retail customers with European operations and
offers greater access to advances in ultra-high
temperature (UHT) technology. - Sold Ferembal S.A. and Dixie Union GmbH & Co. KG, the
company’s two European packaging subsidiaries, which
completes the company’s dispositions of its remaining
international packaging operations. - As of May 3, repurchased 816,400 common shares for a total
cost of $32.2 million under the company’s open market
share repurchase program. Approximately $23.7 million
remains available under the company’s $300 million share
repurchase authorization.
Suiza Foods Corporation, based in Dallas, Texas, is the nation’s leading dairy processor and distributor, producing a full line of company-branded and customer-branded products. National brands include International Delight(R), Second Nature(R), Naturally Yours(R), Mocha Mix(R), Sun Soy(TM), kidsmilk(TM), fitmilk(TM) and lifemilk(TM). Regional brands consist of Adohr Farms(R), Barbe’s(R), Brown’s Velvet Dairy(R), Broughton(R), Country Fresh(R), Dairymen’s(R), Flav-O-Rich(R), Lehigh Valley Farms(R), London’s(R), Meadow Gold(R), Model Dairy(TM), Natural by Garelick Farms(R), Oak Farms(R), Robinson(R), Schepps(R), Shenandoah’s Pride(R), Suiza(TM), Louis Trauth(TM), Tuscan(R), Velda Farms(R) and West Lynn Creamery(R), as well as Celta(R) in Spain. Suiza also sells products under partner or licensed brands in certain regions, including Borden(R), Lactaid(R), Foremost(R) and Pet(R). Additionally, the company owns approximately 43% of Consolidated Container Company, one of the nation’s largest manufacturers of rigid plastic containers.
The company’s earnings conference call will be held at 10:00 a.m. eastern today. The call may be heard live at the company’s web site at www.suizafoods.com. Real Audio software is required to listen to the call and is available on the web site. The software takes approximately 15 minutes to download. Replays will be available at the same address for a limited time period.
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SUIZA FOODS CORPORATION
Condensed Balance Sheet
(in thousands)
March 31, December 31,
ASSETS 2000 1999
------ -------------- ---------------
Cash and cash equivalents $ 32,507 $ 25,155
Other current assets 722,262 614,252
-------------- ---------------
Total current assets 754,769 639,407
Property, plant & equipment 969,607 758,485
Intangibles & other assets 1,903,923 1,261,030
-------------- ---------------
Total Assets $ 3,628,299 $ 2,658,922
============== ===============
LIABILITIES AND STOCKHOLDERS'
EQUITY
Total current liabilities $ 608,899 $ 479,117
Long term debt 1,255,525 689,397
Other long-term liabilities 87,684 81,181
Mandatorily redeemable TIPES 583,650 683,505
Minority interest in
subsidiaries 491,750 141,750
Stockholders' equity:
Common stock 290 293
Additional paid-in capital 261,166 275,527
Retained earnings 340,151 314,590
Other comprehensive income (816) (6,438)
-------------- ---------------
Total stockholders' equity 600,791 583,972
Total Liabilities and
Stockholders' Equity $ 3,628,299 $ 2,658,922
============== ===============
SUIZA FOODS CORPORATION
(Dollars in thousands, except per share data)
Three months ended
March 31,
-------------------------------
2000 1999
------------ -------------
Net sales $ 1,394,141 $ 1,153,186
Cost of sales 1,053,983 920,627
------------ -------------
Gross profit 340,158 232,559
Operating costs and expenses 262,073 170,883
Plant closing costs 1,774 --
------------ -------------
Operating income 76,311 61,676
Interest expense & financing charges
on preferred securities 35,630 25,590
Equity in earnings of unconsolidated
affiliates (1,869) (64)
Other income (547) (443)
------------ -------------
Income before income taxes and
minority interest 43,097 36,593
Income taxes 16,179 14,012
Minority interest 6,324 1,708
------------ -------------
Net income before extraordinary
items 20,594 20,873
Extraordinary gain 4,968 --
------------ -------------
Net income $ 25,562 $ 20,873
============ =============
Net income before nonrecurring
items $ 21,274 $ 20,873
============ =============
Diluted EPS before nonrecurring
items $ 0.71 $ 0.60
============ =============
Diluted cash EPS before nonrecurring
items $ 0.87 $ 0.75
============ =============
Basic earnings per share:
Income before extraordinary items $ 0.71 $ 0.62
Extraordinary gain 0.17 --
------------ -------------
Net income $ 0.88 $ 0.62
============ =============
Basic average common
shares (000's) 29,071 33,642
Diluted earnings per share:
Income before extraordinary items $ 0.69 $ 0.60
Extraordinary gain 0.13 --
------------ -------------
Net income $ 0.82 $ 0.60
============ =============
Diluted average common
shares (000's) 37,611 36,207
Summary Financial Information:
Depreciation $ 24,070 $ 20,525
Amortization $ 13,278 $ 10,158
CONTACT:
Suiza Foods Corporation, Dallas
Cory M. Olson, 214/303-3645
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