updated 11/10/2010 4:45:51 PM ET 2010-11-10T21:45:51

TORONTO, Nov. 10, 2010 (GLOBE NEWSWIRE) -- SunOpta Inc. ("SunOpta" or "the Company") (Nasdaq:STKL) (TSX:SOY), a leading global company focused on natural, organic and specialty foods and natural health products, today announced financial results for the period ended October 2, 2010. All amounts are expressed in U.S. dollars and results are reported in accordance with U.S. GAAP, except where specifically noted. As a result of the June 11, 2010 sale of the Company's Food Distribution Assets and August 31, 2010 sale of SunOpta BioProcess Inc., all results from operations related to these businesses have been excluded from operating results and are now reported as discontinued operations for all comparable periods.

For the third quarter of 2010 the Company realized revenues of $217.9 million versus third quarter 2009 revenues of $212.5 million, a year over year increase of 2.5%. Revenues in SunOpta Foods were $197.5 million, an increase of 0.9% versus the third quarter of 2009. After adjusting for movements in foreign exchange rates and commodity related pricing, revenues increased approximately 7.6% on a consolidated basis versus the third quarter of 2009, and approximately 6.4% in SunOpta Foods, reflecting continued momentum in the natural, organic and specialty foods sectors.

For the third quarter of 2010 the Company reported net income on a GAAP basis of $34.1 million or $0.52 per diluted common share versus net losses in the third quarter of 2009 of $4.7 million or $0.07 per diluted common share. Included in the results of the third quarter was a net gain on the sale of SunOpta Bioprocess Inc. of $34.6 million after tax or $0.52 per diluted common share, offset by non-cash goodwill and impairment charges of $6.4 million after tax or $0.10 per diluted common share.

Earnings from operations1 for the third quarter of 2010 were $5.3 million or $0.08 per diluted common share. Earnings from operations1 for the third quarter include additional pre-tax costs of approximately $0.6 million related primarily to ongoing facility and operational rationalizations.

Operating income1 for the third quarter increased 96.2% to $10.0 million or 4.6% of revenues versus operating income1 in the prior year of $5.1 million or 2.4% of revenues. Operating income1 in SunOpta Foods increased to $9.7 million or 4.9% of revenues versus $5.3 million or 2.7% in the prior year.

EBITDA1 for the third quarter of 2010, excluding the net effect of discontinued operations and non-cash charges increased 52% to $14.1 million versus $9.3 million in 2009, indicative of the improved operating performance realized within the business.

For the year to date period ended October 2, 2010 the Company has realized revenues of $668.5 million versus year to date third quarter 2009 revenues of $619.8 million, a year over year increase of 7.9%. Revenues in SunOpta Foods for the year-to-date period were $609.0 million, an increase of 6.1% versus the year-to-date period in 2009. After adjusting for movements in foreign exchange rates and commodity related pricing, revenues increased approximately 11.2% on a consolidated basis, and approximately 9.7% in SunOpta Foods. Year to date all operating segments have realized increased revenues and operating income1 versus the prior year.   

Year to date the Company has realized net income on a GAAP basis of $59.1 million or $0.90 per diluted common share versus a net loss in 2009 of $4.5 million or $0.07 per diluted common share.   Included in the year to date results was a net gain after tax on the sale of the Canadian Food Distribution assets of $13.8 million or $0.21 per diluted common share and a net gain after tax on the sale of SunOpta Bioprocess Inc. of $34.6 million or $0.52 per diluted common share, offset by certain non-cash goodwill and impairment charges of $6.4 million after tax or $0.10 per diluted common share.

Earnings from operations1 for the three quarters ended October 2, 2010 were $16.6 million or $0.25 per diluted common share. Earnings from operations in the three quarters ended October 2, 2010 also include additional pre-tax costs of approximately $4.6 million, including legal and professional fees and costs related to ongoing facility and operational rationalizations.   

Year to date the Company has realized operating income1 of $31.5 million or 4.7% of revenues versus operating income1 in the prior year of $9.6 million or 1.6% of revenues. Operating income1 in SunOpta Foods increased to $33.9 million or 5.6% of revenues versus $14.1 million or 2.4% in the prior year.

The Company has realized EBITDA1 through the first three quarters ended October 2, 2010 of $43.9 million versus $22.4 million in the prior year, an increase of approximately 96%, excluding the net favorable benefit of dispositions offset by goodwill and impairment charges.

At October 2, 2010 the Company's balance sheet reflects a current working capital ratio of 1.61 to 1.00, long-term debt to equity ratio of 0.25 to 1.00 and total debt to equity ratio of 0.33 to 1.00. During the third quarter the Company generated cash from continuing operations of $20.7 million.  At October 2, 2010 the Company has total assets of $517.4 million and a net book value of $4.42 per outstanding share.

At quarter-end, the Company is in compliance with all banking covenants.

Steve Bromley, President and Chief Executive Officer of SunOpta, commented, "We are very pleased with our third quarter and year to date results which are the result of numerous operational improvement initiatives which have been implemented, combined with the benefit of the disposition of certain of our non-core assets.   We continue to focus on process improvement across the organization and are very pleased that the initiatives undertaken are having the expected positive effect on our results. At the same time our balance sheet has improved significantly with lower debt leverage and improved return on net assets employed. We remain confident that our continued focus on margin improvement and asset management, when combined with strong consumer interest in health and wellness, positions our Company for long-term success."  

The Company plans to host a conference call at 10:00 a.m. Eastern Time on Thursday, November 11th, 2010 to discuss these results and recent corporate developments. The conference call can be accessed via a link at the Company's website at www.sunopta.com . Additionally, the call may be accessed with the toll free dial-in number 1-877-312-9198 or 631-291-4622. A replay number can also be accessed between November 11th and 18th with the toll free dial-in number 1–800-642-1687 or 706-645-9291 followed by pass code: 86530032#.

1 See discussion and reconciliation of Non-GAAP Measures

About SunOpta Inc.

SunOpta Inc. is a leading global company focused on natural, organic and specialty foods and natural health products. The Company specializes in sourcing, processing and packaging of natural and organic food products, integrated from seed through packaged products; with a focus on strategically significant vertically integrated business models The Company's core natural and organic food operations focus on value-added grains, fiber and fruit based product offerings, supported by a global infrastructure. The Company has two non-core holdings, a 66.4% ownership position in Opta Minerals Inc. (TSX:OPM), a producer, distributor, and recycler of environmentally friendly industrial materials; and a minority ownership position in Mascoma Corporation, an innovative biofuels company.

The SunOpta Inc. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=3958

Forward-Looking Statements

Certain statements included in this press release may be considered "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995 and applicable Canadian securities legislation, which are based on information available to us on the date of this release. These forward-looking statements include, but are not limited to, management's continued focus on process improvement, margin improvement and asset management and positioning for long-term success. The terms and phrases "continue," "improvement," "remain confident," "positions," and other similar terms and phrases are intended to identify these forward-looking statements. Forward-looking statements are based on information available to us on the date of this release and are based on estimates and assumptions made by the Company in light of its experience and its perception of historical trends, current conditions and expected future developments as well as other factors the Company believes are appropriate in the circumstances including, but not limited to, general economic conditions, consumer interest in health and wellness, product pricing levels, current customer demand, competitive intensity, cost rationalization and product development initiatives. Whether actual timing and results will agree with expectations and predications of the Company is subject to many risks and uncertainties including, but not limited to, global economic conditions, consumer spending patterns and changes in market trends, decreases in customer demand, potential failure of product development, working capital management and continuous improvement initiatives, availability and pricing of raw materials and supplies, and other risks described from time to time under "Risk Factors" in the Company's Annual Report on Form 10-K and its Quarterly Reports on Form 10-Q (available at www.sec.gov ). Consequently all forward-looking statements made herein are qualified by these cautionary statements and there can be no assurance that the actual results or developments anticipated by the Company will be realized.

Non-GAAP Measures

In addition to reporting financial results in accordance with generally accepted accounting principles ("GAAP"), the Company provides information regarding Operating Income, Earnings before interest, taxes, depreciation and amortization ("EBITDA") and Earnings from Operations as additional information about its operating results, which are not measures in accordance with GAAP. The Company believes that these non-GAAP measures assist investors in comparing performance across reporting periods on a consistent basis by excluding items that are not indicative of the Company's core operating performance. The non-GAAP measures of operating income, EBITDA, and earnings from operations should not be considered in isolation or as a substitute for performance measures calculated in accordance with GAAP. 

The Company defines Operating Income as "Earnings from continuing operations before the following" excluding the impact of "Other expense (income), net" and "Goodwill Impairment;" and EBITDA as Operating Income plus depreciation and amortization. The following is a tabular presentation of Operating Income and EBITDA, including a reconciliation to GAAP earnings for the period, which the Company believes to be the most directly comparable GAAP financial measure.

Earnings from operations and diluted earnings from operations per share are non-GAAP measures. During the quarter and three quarters ended October 2, 2010, the Company recognized certain gains and recorded specific expenses against income that we do not believe are reflective of normal business operations.  As a result, earnings attributable to SunOpta Inc. and earnings per diluted share are adjusted to arrive at earnings from operations and earnings from operations per diluted share. The following is a tabular presentation of earnings from operations and earnings from operations per diluted common share, including a reconciliation to GAAP earnings attributable to SunOpta Inc. and diluted earnings per share, which the Company believes to be the most directly comparable GAAP financial measure.

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