Keurig Green Mountain Inc Slides After Earnings Report

Updated on

The maker of the popular Keurig Green Mountain Inc (NASDAQ:GMCR) one-cup coffee brewers failed to impress enough to stop an after-hours slide in its stock price.

Keurig Green Mountain Inc (NASDAQ:GMCR), after closing the day up with a slight gain, reported its third-quarter earnings after market close today. The company reported earnings per share of $0.94 on a profit of $155.2 million. This was up year-over-year from $0.76 and $116.3 million respectively. Revenue didn’t move tremendously from the corresponding quarter increasing from $967 million last year to $1.02 billion for a rise of 5.7%.

While analysts polled by FactSet were only expecting earnings of $0.87 per share they were calling for higher revenues for the quarter with the consensus expectation coming in at $1.05 billion in sales. This did not stop its CEO from lauding the company’s accomplishments.

Keurig Green Mountain’s CEO seems happy

“We are very pleased with our outstanding non-GAAP net income growth of 31%, which exceeded our long-term growth target. Our free cash flow performance also was strong at $127 million,” said Brian Kelley, Keurig Green Mountain Inc (NASDAQ:GMCR)’s President and CEO. “We delivered net sales of approximately $1 billion for the quarter, driven by 9 percent currency-neutral growth of our core single serve business.”

“Our solid year-over-year brewer shipment growth of 13% and our 15% unit growth in portion packs is indicative of the continued expansion of the Keurig system across the U.S. and Canada,” stated Kelley. “We also are excited about the imminent launch of our new Keurig 2.0 hot platform; the addition of formerly unlicensed and new brands to the Keurig hot beverage system during the quarter; and, our progress on the new Keurig Cold beverage system.”

The unfavorable impact of foreign currency exchange rates reduced net sales for the quarter by a touch over 1%.

CFO speaks to cash flow and stock buy-backs

Following the comments from the company’s CEO, the floor was handed over to Keurig Green Mountain Inc (NASDAQ:GMCR)’s CFO who spoke to the company’s cash flow and stock repurchasing plan that was announced last year.

“We have generated strong free cash flow of $602 million year to date,” said Frances G. Rathke, Keurig Green Mountain Inc (NASDAQ:GMCR)’s Chief Financial Officer. “We’re very pleased to be in a position to return significant cash to shareholders through both dividends and meaningful share repurchases while at the same time investing in our robust innovation pipeline.”

“To date this fiscal year, including the $700 million accelerated stock repurchase we announced last quarter, we’ve returned $1.1 billion in cash to shareholders through a combination of our share repurchases and dividends. At the same time, we have maintained an extremely strong balance sheet,” continued Rathke.

Presently (5;05PM EDT), having closed the day up $0.39 at $118.13, the stock is trading at $115.19 in after-hours trading. This represents a loss of 2.49% or $2.94.

Leave a Comment