The WhiteWave Foods Co. (NYSE: WWAV) reported strong results for the fourth quarter and full year ended Dec. 31, 2012, driven by growth across all of the Company’s product categories.

The Company reported fourth quarter 2012 pro forma adjusted diluted earnings per share of $0.18, a 34 percent increase compared to fourth quarter 2011 pro forma adjusted diluted earnings of $0.13 per share. For full year 2012, the Company reported pro forma adjusted diluted earnings per share of $0.60, representing a 31 percent increase compared to full year 2011 pro forma adjusted diluted earnings per share of $0.46.

Pro forma adjusted net sales for the fourth quarter of 2012 increased 12 percent to $609 million, compared to $543 million in the fourth quarter of 2011. Pro forma adjusted net sales for the full year 2012 increased 13 percent to approximately $2.3 billion from $2.0 billion for the full year 2011. This growth has been primarily volume driven and continues to be led by the Company’s North America Plant-Based Foods & Beverages and Coffee Creamer & Beverages platforms.

Consolidated segment pro forma adjusted operating income for the fourth quarter of 2012 totaled $61 million, compared to $54 million in the fourth quarter of 2011, representing an increase of 13 percent. For the full year 2012, consolidated segment pro forma adjusted operating income increased 16 percent to $228 million, compared to full year 2011 consolidated segment pro forma adjusted operating income of $197 million. These segment operating results were softened somewhat by significant year over year increases in marketing expenditures, and increases in distribution and warehousing costs due to capacity constraints as a result of the Company’s rapid volume growth.

After pro forma corporate costs, the Company reported pro forma adjusted total operating income of $48 million for the fourth quarter of 2012, a 17 percent increase from $41 million in the fourth quarter of 2011. For the full year 2012, pro forma adjusted total operating income increased 22 percent to $173 million from $142 million for full year 2011.

“Our strong top and bottom line growth in the fourth quarter and throughout 2012 is a testament to the power of our leading brands and their positioning in the sweet spot of some of today’s fastest-growing product categories. We are at the heart of a broad and sustained movement towards nutritious, flavorful, convenient and responsibly produced food and beverages,” said Gregg Engles, chairman and CEO. “Looking ahead to 2013, we are focused on growth and continuing to strengthen our brands, introduce new product offerings, expand our manufacturing capabilities, and drive cost savings across our business. We are confident that executing on these strategic initiatives – with the strong foundation we have in place—will ensure WhiteWave’s continued success and growth throughout the year and well into the future.”

North America Segment
The Company’s North America segment is comprised of Plant-based Foods and Beverages, Premium Dairy, and Coffee Creamers and Beverages categories. In the fourth quarter of 2012, pro forma adjusted net sales for the North America segment were $514 million, an increase of 13 percent over the fourth quarter 2011. For the full year 2012, pro forma adjusted net sales for the North America segment were $1.9 billion, an increase of 16 percent over full year 2011. Pro forma adjusted operating income for the North America segment increased 13 percent to $54 million for the fourth quarter, and 20 percent to $204 million for the full year 2012, compared to the same periods in 2011.

In the North America Plant-based Foods and Beverages platform, which includes Silk® Soymilk, Silk PureAlmond® and Silk PureCoconut®, pro forma adjusted net sales increased in the high-teens on a percentage basis in the fourth quarter of 2012 compared to the fourth quarter of 2011, driven primarily by continued strong growth of Silk PureAlmond®. For the full year 2012, pro forma adjusted net sales in this platform increased more than 20 percent, compared to 2011.

The overall Plant-based Foods and Beverages category remained strong with over 20 percent category growth for all of 2012, and WhiteWave’s Silk® brand continued to hold the #1 position. Building on the Silk® brand strength, the Company is also introducing Silk Iced Latte®, a non-dairy iced coffee option and Silk Fruity & Creamy® non-dairy yogurts, in addition to focusing on continued growth of core products.

In Premium Dairy, which includes Horizon Organic® branded dairy products, pro forma adjusted net sales increased in the mid-teens on a percentage basis in the fourth quarter of 2012 compared to the fourth quarter of 2011. While this platform benefited from a favorable comparison to the prior year period due to the lapping of supply constraints, the performance also reflects the strength of the underlying Horizon Organic® brand, as well as positive results from value-added offerings, such as Horizon Organic® single-serve and DHA Omega-3 products. For the full year 2012, pro forma adjusted net sales in Premium Dairy increased in the high-single digits on a percentage basis, compared to 2011.

The Company is expanding its Premium Dairy platform with the launch of new TruMoo® branded flavored milks in shelf-stable single-serve packaging that provides a convenient, healthy and affordable offering for families on the go. TruMoo®, a brand which the Company has licensed from Dean Foods, is a flavored milk line that is lower in sugar than traditional flavored milks and contains no high fructose corn syrup.

In Coffee Creamers and Beverages, which includes coffee creamers under the International Delight® and LAND O LAKES® brands as well as International Delight Iced Coffee®, pro forma adjusted net sales increased in the mid-teens on a percentage basis in the fourth quarter of 2012 compared to the fourth quarter of 2011. For full year 2012, pro forma adjusted net sales in this platform increased in the high-teens on a percentage basis compared to 2011.

The overall flavored creamer category, which continues to benefit from increased coffee consumption and related whitening trends, showed continued strength with approximately 12 percent growth in 2012. The Company plans to continue to build on its Coffee Creamers and Beverages platform with the planned expansion of its International Delight Iced Coffee® product line with a new “lights-line” with only 100 calories, as well as a single-serve four pack that will offer on-the-go convenience to this category.

Europe Segment
The Company’s Europe segment is comprised of its European Plant-based Foods and Beverages platform which operates primarily under the Alpro®name. On a constant currency basis, net sales in the segment increased in the high-single digits on a percentage basis in the fourth quarter of 2012 compared to the fourth quarter of 2011. Net sales for this segment for full year 2012 increased on a constant currency basis in the mid-single digits on a percentage basis compared to 2011. Operating income for the segment increased 16 percent to $7 million for the fourth quarter of 2012 compared to the fourth quarter of 2011, as a result of volume growth and aided by foreign currency translation. For the full year 2012 operating income for the segment decreased 12 percent to $24 million compared to 2011, primarily driven by foreign currency translation. This platform delivered mid-single digit volume growth in the fourth quarter, driven by the strength of its core drinks, including Almond and Hazelnut beverages launched earlier in 2012, and its soy yogurt offerings. The Company plans to introduce several line extensions, including unsweetened and chocolate almond beverages, as well as an improved rice milk line in 2013.

Other items
Pro forma adjusted corporate costs totaled $13 million for the fourth quarter 2012 and $55 million for the full year 2012. Full year 2012 capital expenditures totaled $104 million, compared to $127 million for 2011.

Forward outlook
Building on its strong fourth quarter and full year 2012 results, the Company expects continued momentum in 2013. On a percentage basis, management anticipates pro forma adjusted net sales growth in the high-single digits for both first quarter and full year 2013. The Company anticipates that volume growth across its segments and platforms will be the primary driver of its top line growth, due to the continued growth of its existing products and augmented by a pipeline of new products it will be introducing to the marketplace in 2013.

The Company estimates approximately $55 million in pro forma stand-alone corporate cost in 2013, with approximately $16 million to $17 million occurring in the first quarter and approximately $13 million per quarter over the balance of the year.

As a result of anticipated higher distribution and warehousing costs due to capacity constraints over the first half of the year, the Company expects pro forma adjusted total operating income percentage growth to be in the high-single digits for the first quarter 2013, increasing to the mid-teens for the full year as production capacity is added and other cost reductions are implemented during the year.

Due to strong historical growth and volume growth forecasted, management anticipates a continued burden on internal production capacity, as well as its distribution and warehousing network and therefore, is increasing its estimate of annual capital expenditures to a range of $150 million to $160 million for 2013, from a prior estimate of approximately $125 million.

“We believe that this increase is necessary for us to continue to meet the demand of our growth categories, optimize our overall landed costs and enable us to maintain our high levels of customer service,” said Kelly Haecker, chief financial officer. “Further, we believe this higher spending level will enable us to accelerate certain high-return projects that will allow us to enhance our future operating margins.”

Management anticipates annual interest expense to be approximately $20 million to $22 million, reflecting $60 million in recent debt reduction from proceeds received as part of Dean Foods’ divesture of its Morningstar business. The Company’s estimated tax rate for 2013 is approximately 33 percent.

The Company expects to deliver pro forma adjusted diluted earnings per share of between $0.68 and $0.72 for full year 2013. For the first quarter, management expects pro form adjusted diluted earnings of between $0.14 to $0.16 per share.

Planned spin-off by Dean Foods in May 2013
Dean Foods has affirmed its intention to effect a tax-free spin-off of shares of the Company in May, following the April 23, 2013 expiration of its IPO lock-up period. Dean Foods announced it has received a private letter ruling from the Internal Revenue Service providing that, subject to certain conditions, the anticipated spin-off will be tax-free for U.S. federal income tax purposes. Dean Foods also announced plans to retain up to 19.9% of the total outstanding WhiteWave shares, or up to 34.4 million shares, with the intention to monetize or distribute the position in a tax-free manner at a later date.

“We continue to develop the functions and capabilities necessary for us to operate as a stand-alone company and look forward to the planned separation from Dean Foods in May,” said Engles.

The spin-off or other disposition is subject to various conditions including approval by Dean Foods’ Board of Directors, the receipt of any necessary regulatory or other approvals, the maintenance of the private letter ruling from the Internal Revenue Service, and the existence of satisfactory market conditions. There can be no assurance as to when or whether the proposed spin-off or any other disposition will occur.