TORONTO, Mar 8, 2005 (CCNMatthews via COMTEX) -- SunOpta Inc. (SunOpta or the Company) (STKL) (CA:SOY) today announced results for the year ended December 31, 2004. All amounts are expressed in U.S. dollars.
The Company achieved record revenues and earnings for the year ended December 31, 2004. Revenues in 2004 increased by 54% to $306,251,000 from $199,099,000 in 2003, led by a 57% increase in revenues within the Company's vertically integrated food operations, focused on the natural and organic foods markets. The Company's overall revenue growth of 54% was driven by internal growth of 14.5% and growth via acquisitions of 39.5%.
Net earnings for the year were a record $11,016,000 or $0.20 per diluted common share compared to $8,966,000 or $0.18 per diluted common share in 2003. The improvement in earnings is due to a number of factors including increased sales of fiber products and custom blended ingredients within the Company's Ingredients Group segment, the realization of a number of private label contracts throughout the organization, internal growth in the Canadian Food Distribution Group and the Opta Minerals Group, and the calendarization of acquisitions completed in 2003 and 2004. In addition, the Company recognized a gain in the second quarter of 2004 related to a legal award in the Company's favour. These factors were partially offset by the non-cash write-off of certain trademarks as detailed below, the direct and indirect costs of complying with the Sarbanes-Oxley Act, costs related to the Opta Minerals IPO, issues related to the integration of acquired distribution businesses, and the impact of the poor soy crop quality and yield.
Revenues in the fourth quarter of 2004 were $82,661,000, a 51% increase over 2003, representing the Company's 29th consecutive quarter of record revenue growth over the same quarter in the previous year. Net earnings in the quarter were $355,000 or $0.01 per diluted common share, compared to $3,197,000 or $0.06 per diluted share in the same period in 2003. Quarterly earnings were affected by the non-cash write-off of certain trademarks, the impact of Sarbanes-Oxley related costs and costs related to the Opta Minerals IPO as noted above. Excluding these costs, and certain other smaller one-time items, diluted earnings per share would have been $0.06 in the fourth quarter of 2004.
In the fourth quarter, the Company made the business decision to focus its future shelf-stable beverage packaging efforts on supplying its existing customers and marketing its aseptic packaging capabilities to the rapidly growing private label market. The private label market in North America has grown substantially in recent years as retailers recognize the benefit of generating consumer loyalty with an in-house brand. As a result of this decision, the Company has taken the decision to de-emphasize the use of its own brands in the shelf-stable beverage market, and accordingly have written-off the value of these trademarks recorded on its balance sheet, in the amount of $2,250,000 pre-tax.
The Company continues to be well positioned for future growth with net working capital of $60,491,000 and total assets of $220,172,000. The debt to equity ratio at December 31, 2004 was 0.25:1, providing the Company will significant financial resources to invest further in internal growth and execute its acquisition program.
The Company has announced that it expects to achieve revenues of $385,000,000 in 2005, an increase of 26% versus 2004. The increase is based on a combination of expected internal growth of 15% to 17% and the calendarization of acquisitions completed in 2004.
Jeremy N. Kendall, Chairman and CEO of SunOpta, commented that, "I am very pleased with our progress to date. Although we faced some challenges in 2004, we persevered and were able to generate record revenues, record earnings and record cash flow from operations, all while remaining true to our values and our mission."
SunOpta's Chairman and CEO, Jeremy Kendall, also plans to host a conference call at 10:00 AM Eastern Standard Time on Wednesday, March 9, 2005, to discuss annual results and recent corporate developments. After opening remarks, there will be a question and answer period. This conference call can be accessed with the toll free dial-in number (800) 946-0782 or (719) 457-2657 followed by pass code: 4152365#. The call will also be distributed live over CCBN's Investor Distribution Network to both institutional and individual investors. Individual investors may listen to the call via www.companyboardroom.com, and institutional investors may listen via www.streetevents.com. Additionally, the call may be accessed via a link at the Company's website at www.sunopta.com. To listen to the live call over the Internet, please go to one of the websites at least 15 minutes early to register, download and install any necessary audio software. If you are unable to listen live, the conference call will be archived and can be accessed for approximately 90 days at the websites. A replay number can also be accessed between March 9, 2005 and March 18, 2005 with the toll free dial-in number (888) 203-1112 or (719) 457-0820 followed by pass code: 4152365#.
SunOpta Inc. is an operator of high-growth ethical businesses, focusing on integrated business models in the natural and organic food markets. For the last six consecutive years, SunOpta was included in Profit magazine's 'Profit 100' list of the 100 fastest growing companies in Canada. The Company has three business units: the SunOpta Food Group, which specializes in sourcing, processing and distribution of natural and organic food products integrated from seed through packaged products; the Opta Minerals Group, a producer, distributor, and recycler of environmentally friendly industrial materials; and the StakeTech Steam Explosion Group which engineers and markets proprietary steam explosion technology systems for the pulp, bio-fuel and food processing industries. Each of these business units has proprietary products and services that give it a solid competitive advantage in its sector.
Note: This news release may contain forward-looking information. Actual future results may differ materially. The risks, uncertainties, and other factors that could influence actual results are described in the Company's annual report to shareholders and in SEC filings. The attached consolidated balance sheet and consolidated statement of earnings are unaudited. The information provided here should be considered in conjunction with the other information included within various SEC documents including Form 10Q reports filed during 2004 and Form 10K report to be filed March 15, 2005.