WhiteWave Foods Q2 Profit Beats View, Lifts 2015 Outlook

(RTTNews) - WhiteWave Foods Co. (WWAV) on Friday reported a 9 percent increase in profit for the second quarter from last year, reflecting double-digit revenue growth and higher margins.

Adjusted earnings per share for the quarter beat analysts' expectations, while revenues missed their estimates. Looking ahead, the consumer packaged foods company forecast earnings for the third quarter mostly below Street view, but raised its financial outlook for fiscal 2015. The company also said it has agreed to acquire California-based Wallaby Yogurt Company for about $125 million in cash, and closed on the acquisition of Vega, a plant-based nutritional business. Wallaby Yogurt is manufacturer and distributor of organic dairy yogurt products that include Greek and Australian yogurts and Kefir beverages.

The Denver, Colorado-based consumer packaged food and beverage company's net income for the second quarter was $37.44 million or $0.21 per share, up from $34.41 million or $0.19 per share in the prior-year quarter.

Excluding items, adjusted net income for the quarter was $43.63 million or $0.24 per share, compared to $39.72 million or $0.22 per share in the year-ago quarter.

Excluding investments associated with the company's China joint venture, adjusted net income for the quarter was $0.26 per share, compared to $0.23 per share last year. On average, 25 analysts polled by Thomson Reuters expected the company to report earnings of $0.25 per share. Analysts' estimates typically exclude one-time items.

Net sales for the quarter increased 10 percent to $923.63 million from $837.93 million in the same quarter last year, but missed analysts' consensus estimate of $928.28 million.

The increase in net sales were driven by strong growth across the Americas Foods & Beverages as well as Europe Foods & Beverages segments, and a benefit from the inclusion of So Delicious Dairy Free that was acquired in fourth quarter of 2014.

On a constant currency basis, net sales increased 14 percent. Excluding acquisitions, organic constant currency net sales increased 9 percent.

Americas Foods & Beverages segment reported a 15 percent increase in net sales for the quarter to $640 million, while Europe Foods & Beverages segment net sales rose 3 percent to $133 million.

Looking ahead to the third quarter, WhiteWave Foods forecast constant currency adjusted earnings of $0.31 to $0.33 per share, while on a U.S. dollar reported basis, it expects adjusted earnings of $0.29 to $0.31 per share, both excluding China joint venture investments.

The company expects net sales growth for the third quarter of 18 percent to 19 percent on a constant currency basis, translating into 14 percent to 15 percent growth on a reported basis.

Analysts expect the company to report earnings of $0.31 per share for the quarter on revenue growth of 12.4 percent to $963.45 million.

For fiscal 2015, WhiteWave Foods raised its adjusted earnings outlook on a U.S. dollar reported basis to a range of $1.14 to $1.17 per share and constant currency adjusted earnings to a range of $1.19 to $1.22 per share, both excluding China joint venture investments.

Earlier, the company forecast full-year adjusted earnings of $1.10 to $1.14 per share and constant currency adjusted earnings of $1.16 to $1.20 per share, excluding China joint venture investments.

Further, the company now forecasts net sales growth of 15 percent to 16 percent on a constant currency basis, and 12 percent to 13 percent on a reported basis. Earlier, the company expected net sales growth of low-teens on a constant currency basis, and low-double digits on a reported basis.

Wall Street currently is looking for earnings of $1.14 per share for the year on 11.1 percent increase in revenues to $3.82 billion.

The transaction to acquire Wallaby Yogurt is expected to close in the third quarter of 2015. The company expects the transaction will be neutral to earnings per share in 2015 and slightly accretive by the latter part of 2016, with additional accretion expected thereafter.

WWAV is currently trading at $49.95, down $0.66 or 1.30 percent on a volume of 2.63 million shares.