Cott Reports Second Quarter 2015 Results and Announces Agreement to Acquire Two Home and Office Water Delivery Companies
(Unless stated otherwise, all second quarter 2015 comparisons are relative to the second quarter of 2014; all information is in U.S. dollars.)
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TORONTO, ON and TAMPA, FL -- (Marketwired) -- 07/30/15 -- Cott Corporation (NYSE: COT) (TSX: BCB) today announced its results for the second quarter ended July 4, 2015.
SECOND QUARTER 2015 HIGHLIGHTS
- Revenue of $780 million was higher by 42% compared to $549 million as a result of the acquisition of DS Services, offset in part by the impact of foreign exchange and a product mix shift towards contract manufacturing and across other private label categories in our traditional business.
- Gross profit was $241 million compared to $79 million, which resulted in gross profit as a percentage of revenue of 30.9% compared to 14.4%.
- Adjusted EBITDA increased 93% to $108 million compared to $56 million. Reported EBITDA was $103 million compared to $32 million.
- With continued focus on Cott's strategic priorities designed to build long-term shareowner value:
- DS Services revenue increased 2.2% (3.1% on an adjusted basis). Synergy capture and integration of DS Services continued to make good progress with $2 million of synergies realized during the second quarter for a total of over $3 million of synergies realized to date.
- Two agreements have been signed for the acquisition of home and office delivery ("HOD") water businesses which together generate approximately $9 million in annual revenues. The acquisitions, which are subject to customary closing conditions, are expected to close in the third quarter of 2015.
- The North America business unit continued to expand its contract manufacturing business, which grew by approximately 7 million serving equivalent cases. For the North America business unit, gross margin increased 165 basis points to 14.5%.
- Convertible and non-convertible preferred shares of $149 million were fully redeemed on June 11, 2015 with proceeds from our oversubscribed equity offering and cash on hand.
"I am pleased with the continued volume stability within our traditional business and the increased gross margins, EBITDA, and cash flow for the entire business," commented Jerry Fowden, Cott's Chief Executive Officer. "I believe the redemption of the preferred shares within the quarter alongside the greater flexibility it provides to pursue multiple value creating DS HOD water tuck in-acquisitions positions us well as we look forward," continued Mr. Fowden.
SECOND QUARTER 2015 GLOBAL PERFORMANCE
- Revenue of $780 million was higher by 42%. Excluding the impact of foreign exchange and DS Services, revenue was lower by 1% primarily as a result of a product mix shift in our traditional business.
- Gross profit increased 204% to $241 million, with gross margin of 30.9% compared to 14.4%. Excluding DS Services, gross margin increased by 170 basis points to 16.1% from 14.4% driven primarily by the addition of the higher margin Aimia Foods business and cost and efficiency savings, offset in part by the impact of foreign exchange and the competitive environment in our U.K./Europe operations.
- Selling, general and administrative ("SG&A") expenses were $190 million compared to $51 million. The increase in SG&A expenses was due to $139 million in expenses associated with the addition of the DS Services business. Excluding DS Services, SG&A expenses were flat at $51 million.
- Interest expense increased to $28 million due primarily to the additional debt incurred in connection with the DS Services acquisition.
- Other expense was $1 million compared to $20 million due primarily to a net loss on foreign currency in the current quarter versus $19 million in expense related to the purchase of a majority of our 8.125% senior notes due in 2018 ("2018 Notes") in a cash tender offer in the prior year.
- Income tax benefit was $1 million compared to expense of $3 million.
- Redemption of the preferred shares resulted in a non-cash income statement charge of $12 million despite issuing the shares in U.S. dollars as well as redeeming the shares in U.S. dollars. Due to our Canadian incorporation we were required to record the issuance of the preferred shares in Canadian currency and to record a non-cash charge to the income statement as a result of the change in the Canadian exchange rate from the date of issuance to the date of redemption.
- Adjusted net income and adjusted net income per diluted share were $18 million and $0.18, respectively, compared to adjusted net income of $17 million and adjusted net income per diluted share of $0.18. Reported net income and net income per diluted share were $2.2 million and $0.02, respectively, compared to reported net loss and loss per diluted share of $6 million and $0.06, respectively.
- Adjusted EBITDA increased 93% to $108 million due primarily to the addition of the DS Services business as well as volume stabilization and cost savings programs, offset in part by the competitive environment in our U.K./Europe operations and a $4 million impact of unfavorable foreign exchange rates.
- Free cash flow increased by 159% to $46 million, reflecting $76 million of net cash provided by operating activities less $30 million of capital expenditures. Adjusted free cash flow increased 34%.
SECOND QUARTER 2015 REPORTING SEGMENT PERFORMANCE
- North America volume was lower by 1% in actual cases and 2% in servings driven by a general market decline in CSDs and private label shelf stable juice, offset largely by increases in contract manufacturing and other growth areas such as sparkling waters and mixers. Revenue was lower by 5% (lower by 4% excluding the impact of foreign exchange) at $359 million due primarily to an overall product mix shift into contract manufacturing and across other private label categories. Gross margin increased 165 basis points to 14.5%, operating income increased 20% to $18 million, and EBITDA increased 9% to $39 million due primarily to stable volumes and tighter cost controls.
- DS Services revenue increased 2.2% to $257 million due primarily to growth in HOD water, single cup coffee delivery, and retail sales, offset in part by a declining energy surcharge as a result of lower diesel fuel prices and reduced sales in traditional brew basket coffee. Revenue on an adjusted basis increased 3.1%. HOD average returnable five gallon and three gallon consumption increased 0.4% (excluding the impact of the Primo partnership) and the HOD customer base increased 0.7%. DS Services adjusted EBITDA increased by $3 million, or 7%, to $49 million compared to $46 million while operating income excluding the $3 million of acquisition and integration costs increased 9% to $16 million.
- U.K. volume increased 10% in servings due primarily to the addition of the Aimia Foods business. Revenue decreased 3% (increased 7% excluding the impact of foreign exchange) to $154 million due primarily to the impact of foreign exchange rates and the competitive environment, offset in part by the addition of the Aimia Foods business.
- All Other revenue was $16 million compared to $18 million due to product mix shifts within Royal Crown International and Mexico. Gross profit increased to $7 million from $6 million.
SECOND QUARTER RESULTS CONFERENCE CALL
Cott Corporation will host a conference call today, July 30, 2015, at 10:00 a.m. ET, to discuss second quarter results, which can be accessed as follows:
North America: (888) 572-7026 International: (719) 325-2344 Passcode: 5930783
A live audio webcast will be available through Cott's website at http://www.cott.com. The earnings conference call will be recorded and archived for playback on the investor relations section of the website for a period of two weeks following the event.
ABOUT COTT CORPORATION
Cott is one of the world's largest producers of beverages on behalf of retailers, brand owners and distributors, and has one of the broadest home and office bottled water and office coffee services distribution networks in the United States, with the ability to service approximately 90 percent of U.S. households, as well as national, regional and local offices.
Cott produces multiple types of beverages in a variety of packaging formats and sizes, including carbonated soft drinks, 100% shelf stable juice and juice-based products, clear, still and sparkling flavored waters, energy drinks and shots, sports drinks, new age beverages, ready-to-drink teas, beverage concentrates, liquid enhancers, freezables and ready-to-drink alcoholic beverages, as well as hot chocolate, coffee, malt drinks, creamers/whiteners and cereals. Cott's large manufacturing footprint, broad distribution network, substantial research and development capability and high-level of quality and customer service enables Cott to offer its customers a strong value-added proposition of low cost, high quality products and services. In addition, Cott is now a national direct-to-consumer provider of bottled water, office coffee and water filtration services offering a comprehensive portfolio of beverage products, equipment and supplies to approximately 1.5 million customer locations through its network of over 180 warehouse, branch and distribution facilities and daily operation of over 2,200 routes.
With over 9,000 employees, Cott operates approximately 60 manufacturing facilities and 180 distribution facilities in the United States, Canada, the United Kingdom and Mexico. Cott also develops and manufactures beverage concentrates, which it exports to approximately 50 countries around the world.
Non-GAAP Measures
To supplement its reporting of financial measures determined in accordance with GAAP, Cott utilizes certain non-GAAP financial measures. Cott excludes from GAAP revenue the impact of foreign exchange, the impact of energy surcharges, and, in some cases, the impact of DS Services, to separate the impact of currency exchange rate changes, energy surcharges and recent acquisitions from Cott's results of operations. Cott utilizes adjusted gross margin (on a global, and in some cases, business unit basis), adjusted SG&A expenses, adjusted pre-tax income (loss), adjusted net income (loss), adjusted net income (loss) per diluted share, EBITDA and adjusted EBITDA (on a global, and in some cases, business unit, basis)to separate the impact of certain items from the underlying business. Because Cott uses these adjusted financial results in the management of its business, management believes this supplemental information is useful to investors for their independent evaluation and understanding of Cott's underlying business performance and the performance of its management. Additionally, Cott supplements its reporting of net cash provided by operating activities determined in accordance with GAAP by excluding capital expenditures to present free cash flow, and by excluding bond redemption costs to present adjusted free cash flow, which management believes provides useful information to investors about the amount of cash generated by the business that, after the acquisition of property and equipment, can be used for strategic opportunities, including investing in our business, making strategic acquisitions, paying dividends, and strengthening the balance sheet. The non-GAAP financial measures described above are in addition to, and not meant to be considered superior to, or a substitute for, Cott's financial statements prepared in accordance with GAAP. In addition, the non-GAAP financial measures included in this earnings announcement reflect management's judgment of particular items, and may be different from, and therefore may not be comparable to, similarly titled measures reported by other companies.
Safe Harbor Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 conveying management's expectations as to the future based on plans, estimates and projections at the time Cott makes the statements. Forward-looking statements involve inherent risks and uncertainties and Cott cautions you that a number of important factors could cause actual results to differ materially from those contained in any such forward-looking statement. The forward-looking statements contained in this press release include, but are not limited to, statements related to the execution of our strategic priorities (including, but not limited to, statements related to the integration and synergy targets in connection with the DS Services business), the anticipated closing of certain acquisitions in our DS Services business, future financial and operating trends and results and related matters. The forward-looking statements are based on assumptions regarding management's current plans and estimates. Management believes these assumptions to be reasonable but there is no assurance that they will prove to be accurate.
Factors that could cause actual results to differ materially from those described in this press release include, among others: our ability to compete successfully in a highly competitive beverage category; changes in consumer tastes and preferences for existing products and our ability to develop and timely launch new products that appeal to such changing consumer tastes and preferences; a loss of or a reduction in business in our legacy Cott business with key customers, particularly Walmart; consolidation of retail customers; fluctuations in commodity prices and our ability to pass on increased costs to our customers, and the impact of those increased prices on our volumes; our ability to manage our operations successfully; our ability to fully realize the potential benefit of acquisitions or other strategic opportunities that we pursue; our ability to realize the expected benefits of recent acquisitions or other strategic opportunities that we may pursue because of integration difficulties and other challenges; risks associated with the DS Services acquisition agreement; changes resulting from our assessment of the effectiveness of the system of internal control over financial reporting maintained by DS Services; limited financial information on which to evaluate the combined company; the incurrence of substantial indebtedness to finance the DS Services acquisition; our exposure to intangible asset risk; currency fluctuations that adversely affect the exchange between the U.S. dollar and the British pound sterling, the Euro, the Canadian dollar, the Mexican peso and other currencies; our ability to maintain favorable arrangements and relationships with our suppliers; our substantial indebtedness and our ability to meet our obligations under our debt agreements, and risks of further increases to our indebtedness; our ability to maintain compliance with the covenants and conditions under our debt agreements; fluctuations in interest rates, which could increase our borrowing costs; credit rating changes; the impact of global financial events on our financial results; our ability to fully realize the expected cost savings and/or operating efficiencies from our restructuring activities; any disruption to production at our beverage concentrates or other manufacturing facilities; our ability to maintain access to our water sources; our ability to protect our intellectual property; compliance with product health and safety standards; liability for injury or illness caused by the consumption of contaminated products; liability and damage to our reputation as a result of litigation or legal proceedings; changes in the legal and regulatory environment in which we operate; the impact of proposed taxes on soda and other sugary drinks; enforcement of compliance with the Ontario Environmental Protection Act; the seasonal nature of our business and the effect of adverse weather conditions; the impact of national, regional and global events, including those of a political, economic, business and competitive nature; our ability to recruit, retain, and integrate new management; our ability to renew our collective bargaining agreements on satisfactory terms; disruptions in our information systems; or our ability to securely maintain our customers' confidential or credit card information, or other private data relating to our employees or our company.
The foregoing list of factors is not exhaustive. Readers are cautioned not to place undue reliance on any forward-looking statements, which speak only as of the date hereof. Readers are urged to carefully review and consider the various disclosures, including but not limited to risk factors contained in Cott's Annual Report on Form 10-K and its quarterly reports on Form 10-Q, as well as other filings with the securities commissions. Cott does not undertake to update or revise any of these statements in light of new information or future events, except as expressly required by applicable law.
Website: www.cott.com
COTT CORPORATION EXHIBIT 1
CONSOLIDATED STATEMENTS OF OPERATIONS
RECONCILIATION OF NON-GAAP TO GAAP RESULTS
(in millions of U.S. dollars, except share and per share amounts)
Unaudited
For the Three Months Ended July 4, 2015
-------------------------------------------------------
Acquisition Unrealized
and and other
Integration Other non-cash
GAAP Expenses Adjustments expenses Non-GAAP
-------- ------------ ------------ ----------- --------
Revenue, net $ 779.8 $ - $ 2.3 $ - $ 782.1
Cost of sales 539.2 - - 0.9 540.1
-------- ------------ ------------ ----------- --------
Gross profit 240.6 - 2.3 (0.9) 242.0
Selling, general
and
administrative
expenses 190.2 - 1.7 - 191.9
Loss (gain) on
disposal of
property, plant &
equipment 0.2 - 1.0 (1.2) -
Restructuring - - - - -
Asset impairments - - - - -
Acquisition and
integration
expenses 4.1 (4.1) - - -
-------- ------------ ------------ ----------- --------
Operating income 46.1 4.1 (0.4) 0.3 50.1
Other expense
(income), net 1.0 - - (1.0) -
Interest expense,
net 27.9 - - - 27.9
-------- ------------ ------------ ----------- --------
Income (loss)
before income
taxes - EBT 17.2 4.1 (0.4) 1.3 22.2
Income tax
(benefit) expense (1.1) 1.4 (0.2) 0.4 0.5
-------- ------------ ------------ ----------- --------
Net income (loss) $ 18.3 $ 2.7 $ (0.2) $ 0.9 $ 21.7
Less: Net income
attributable to
non-controlling
interests 1.7 - - - 1.7
Less: Accumulated
dividends on
convertible
preferred shares 1.8 - - - 1.8
Less: Accumulated
dividends on non-
convertible
preferred shares 0.6 - - - 0.6
Less: Foreign
exchange impact
on redemption of
preferred shares 12.0 - (12.0) - -
-------- ------------ ------------ ----------- --------
Net income (loss)
attributed to
Cott Corporation $ 2.2 $ 2.7 $ 11.8 $ 0.9 $ 17.6
======== ============ ============ =========== ========
Net income (loss) per
common share attributed
to Cott Corporation
Basic $ 0.02 $ 0.18
Diluted $ 0.02 $ 0.18
Weighted average
outstanding shares
(millions) attributed to
Cott Corporation
Basic 99.6 99.6
Diluted 100.2 100.2
Dividends declared
per common share $ 0.06
EBT $ 17.2 $ 22.2
Interest expense,
net 27.9 27.9
Depreciation &
Amortization 58.2 58.2
-------- --------
EBITDA $ 103.3 $ 108.3
======== ========
For the Three Months Ended June 28, 2014
---------------------------------------------------------
Acquisition Unrealized
and and other
Integration Other non-cash Non-
GAAP Expenses Adjustments expenses GAAP
---------- ------------ ------------ ----------- --------
Revenue, net $ 549.2 $ - $ - $ - $ 549.2
Cost of sales 470.2 (1.2) - - 469.0
---------- ------------ ------------ ----------- --------
Gross profit 79.0 1.2 - - 80.2
Selling, general
and
administrative
expenses 50.7 - (0.2) - 50.5
Loss (gain) on
disposal of
property, plant &
equipment (0.1) - - - (0.1)
Restructuring 0.1 - (0.1) - -
Asset impairments 0.3 - (0.3) - -
Acquisition and
integration
expenses 1.8 (1.8) - - -
---------- ------------ ------------ ----------- --------
Operating income 26.2 3.0 0.6 - 29.8
Other expense
(income), net 19.8 - (19.6) (0.7) (0.5)
Interest expense,
net 8.4 - - - 8.4
---------- ------------ ------------ ----------- --------
Income (loss)
before income
taxes - EBT (2.0) 3.0 20.2 0.7 21.9
Income tax
(benefit) expense 2.5 0.6 0.1 0.1 3.3
---------- ------------ ------------ ----------- --------
Net income (loss) $ (4.5) $ 2.4 $ 20.1 $ 0.6 $ 18.6
Less: Net income
attributable to
non-controlling
interests 1.4 - - - 1.4
Less: Accumulated
dividends on
convertible
preferred shares - - - - -
Less: Accumulated
dividends on non-
convertible
preferred shares - - - - -
Less: Foreign
exchange impact
on redemption of
preferred shares - - - - -
---------- ------------ ------------ ----------- --------
Net income (loss)
attributed to
Cott Corporation $ (5.9) $ 2.4 $ 20.1 $ 0.6 $ 17.2
========== ============ ============ =========== ========
Net income (loss)
per common share
attributed to
Cott Corporation
Basic $ (0.06) $ 0.18
Diluted $ (0.06) $ 0.18
Weighted average
outstanding
shares (millions)
attributed to
Cott Corporation
Basic 94.2 94.2
Diluted 94.2 94.6
Dividends declared
per common share $ 0.06
EBT $ (2.0) $ 21.9
Interest expense,
net 8.4 8.4
Depreciation &
Amortization 25.8 25.8
---------- --------
EBITDA $ 32.2 $ 56.1
========== ========
COTT CORPORATION EXHIBIT 2
CONSOLIDATED STATEMENTS OF OPERATIONS
RECONCILIATION OF NON-GAAP TO GAAP RESULTS
(in millions of U.S. dollars, except share and per share amounts)
Unaudited
For the Six Months Ended July 4, 2015
------------------------------------------------------------
Acquisition Unrealized
and and other
Integration Other non-cash
GAAP Expenses Adjustments expenses Non-GAAP
--------- ------------- ------------- ------------ ---------
Revenue, net $1,489.6 $ 0.9 $ 3.4 $ - $1,493.9
Cost of sales 1,047.7 (3.3) - 1.2 1,045.6
--------- ------------- ------------- ------------ ---------
Gross profit 441.9 4.2 3.4 (1.2) 448.3
Selling,
general and
administrativ
e expenses 378.7 - 2.8 - 381.5
Loss (gain) on
disposal of
property,
plant &
equipment 1.6 - 1.0 (2.7) (0.1)
Restructuring - - - - -
Asset
impairments - - - - -
Acquisition
and
integration
expenses 8.8 (8.8) - - -
--------- ------------- ------------- ------------ ---------
Operating
income 52.8 13.0 (0.4) 1.5 66.9
Other (income)
expense, net (9.4) - - 9.9 0.5
Interest
expense, net 55.6 - - - 55.6
--------- ------------- ------------- ------------ ---------
Income (loss)
before income
taxes - EBT 6.6 13.0 (0.4) (8.4) 10.8
Income tax
(benefit)
expense (10.5) 4.7 (0.2) (2.0) (8.0)
--------- ------------- ------------- ------------ ---------
Net income
(loss) $ 17.1 $ 8.3 $ (0.2) $ (6.4) $ 18.8
Less: Net
income
attributable
to non-
controlling
interests 3.0 - - - 3.0
Less:
Accumulated
dividends on
convertible
preferred
shares 4.5 - - - 4.5
Less:
Accumulated
dividends on
non-
convertible
preferred
shares 1.4 - - - 1.4
Less: Foreign
exchange
impact on
redemption of
preferred
shares 12.0 - (12.0) - -
--------- ------------- ------------- ------------ ---------
Net (loss)
income
attributed to
Cott
Corporation $ (3.8) $ 8.3 $ 11.8 $ (6.4) $ 9.9
========= ============= ============= ============ =========
Net (loss) income per
common share
attributed to Cott
Corporation
Basic $ (0.04) $ 0.10
Diluted $ (0.04) $ 0.10
Weighted average outstanding shares
(millions) attributed to Cott
Corporation
Basic 96.4 96.4
Diluted 96.4 96.9
Dividends
declared per
common share $ 0.12
EBT $ 6.6 $ 10.8
Interest
expense, net 55.6 55.6
Depreciation &
Amortization 115.6 115.6
--------- ---------
EBITDA $ 177.8 $ 182.0
========= =========
For the Six Months Ended June 28, 2014
------------------------------------------------------------
Acquisition Unrealized
and and other
Integration Other non-cash
GAAP Expenses Adjustments expenses Non-GAAP
--------- ------------- ------------- ------------ ---------
Revenue, net $1,024.3 $ - $ - $ - $1,024.3
Cost of sales 889.1 (1.2) - - 887.9
--------- ------------- ------------- ------------ ---------
Gross profit 135.2 1.2 - - 136.4
Selling,
general and
administrativ
e expenses 97.6 - (0.3) - 97.3
Loss (gain) on
disposal of
property,
plant &
equipment - - - (0.1) (0.1)
Restructuring 2.3 - (2.3) - -
Asset
impairments 1.9 - (1.9) - -
Acquisition
and
integration
expenses 2.9 (2.9) - - -
--------- ------------- ------------- ------------ ---------
Operating
income 30.5 4.1 4.5 0.1 39.2
Other (income)
expense, net 17.5 3.5 (20.5) (1.3) (0.8)
Interest
expense, net 18.2 - - - 18.2
--------- ------------- ------------- ------------ ---------
Income (loss)
before income
taxes - EBT (5.2) 0.6 25.0 1.4 21.8
Income tax
(benefit)
expense 2.0 0.7 1.0 0.3 4.0
--------- ------------- ------------- ------------ ---------
Net income
(loss) $ (7.2) $ (0.1) $ 24.0 $ 1.1 $ 17.8
Less: Net
income
attributable
to non-
controlling
interests 2.8 - - - 2.8
Less:
Accumulated
dividends on
convertible
preferred
shares - - - - -
Less:
Accumulated
dividends on
non-
convertible
preferred
shares - - - - -
Less: Foreign
exchange
impact on
redemption of
preferred
shares - - - - -
--------- ------------- ------------- ------------ ---------
Net (loss)
income
attributed to
Cott
Corporation $ (10.0) $ (0.1) $ 24.0 $ 1.1 $ 15.0
========= ============= ============= ============ =========
Net (loss)
income per
common share
attributed to
Cott
Corporation
Basic $ (0.11) $ 0.16
Diluted $ (0.11) $ 0.16
Weighted
average
outstanding
shares
(millions)
attributed to
Cott
Corporation
Basic 94.3 94.3
Diluted 94.3 94.9
Dividends
declared per
common share $ 0.12
EBT $ (5.2) $ 21.8
Interest
expense, net 18.2 18.2
Depreciation &
Amortization 50.9 50.9
--------- ---------
EBITDA $ 63.9 $ 90.9
========= =========
COTT CORPORATION EXHIBIT 3
CONSOLIDATED BALANCE SHEETS
(in millions of U.S. dollars, except share
amounts, U.S. GAAP)
Unaudited
-------------- ---------------
July 4, 2015 January 3, 2015
-------------- ---------------
ASSETS
Current assets
Cash & cash equivalents $ 79.0 $ 86.2
Accounts receivable, net of allowance 366.6 305.7
Income taxes recoverable 1.3 1.6
Inventories 266.7 262.4
Prepaid expenses and other current assets 39.5 59.3
-------------- ---------------
Total current assets 753.1 715.2
Property, plant & equipment, net 820.2 864.5
Goodwill 748.9 743.6
Intangibles and other assets, net 749.9 781.7
Deferred income taxes 1.3 2.5
Other tax receivable 0.1 0.2
-------------- ---------------
Total assets $ 3,073.5 $ 3,107.7
============== ===============
LIABILITIES, PREFERRED SHARES AND EQUITY
Current liabilities
Short-term borrowings $ 198.2 $ 229.0
Current maturities of long-term debt 3.9 4.0
Accounts payable and accrued liabilities 453.9 420.3
-------------- ---------------
Total current liabilities 656.0 653.3
Long-term debt 1,550.2 1,565.0
Deferred income taxes 101.8 119.9
Other long-term liabilities 88.5 71.8
-------------- ---------------
Total liabilities 2,396.5 2,410.0
Convertible preferred shares, $1,000 stated
value, no shares issued (January 3, 2015 -
116,054 shares issued) - 116.1
Non-convertible preferred shares, $1,000
stated value, no shares issued (January 3,
2015 - 32,711 shares issued) - 32.7
Equity
Capital stock, no par - 109,585,142 shares
issued (January 3, 2015 - 93,072,850
shares issued) 532.1 388.3
Additional paid-in-capital 50.9 46.6
Retained earnings 142.2 158.1
Accumulated other comprehensive loss (54.6) (51.0)
-------------- ---------------
Total Cott Corporation equity 670.6 542.0
Non-controlling interests 6.4 6.9
-------------- ---------------
Total equity 677.0 548.9
-------------- ---------------
Total liabilities, preferred shares and
equity $ 3,073.5 $ 3,107.7
============== ===============
COTT CORPORATION EXHIBIT 4
CONSOLIDATED
STATEMENTS OF
CASH FLOWS
(in millions of
U.S. dollars)
Unaudited
For the Three Months Ended For the Six Months Ended
---------------------------- ----------------------------
July 4, 2015 June 28, 2014 July 4, 2015 June 28, 2014
------------- -------------- ------------- --------------
Operating
Activities
Net income (loss) $ 18.3 $ (4.5) $ 17.1 $ (7.2)
Depreciation &
amortization 58.2 25.8 115.6 50.9
Amortization of
financing fees 1.1 0.6 2.4 1.2
Amortization of
senior notes
premium (1.4) - (2.9) -
Share-based
compensation
expense 3.7 2.1 6.1 3.4
(Decrease)
increase in
deferred income
taxes (5.2) 2.6 (16.9) 1.9
Write-off of
financing fees
and discount - 3.0 - 3.3
Loss (gain) on
disposal of
property, plant
& equipment 0.2 (0.1) 1.6 -
Asset impairments - 0.3 - 1.9
Other non-cash
items (6.3) (0.5) (16.5) (0.7)
Change in
operating assets
and liabilities,
net of
acquisitions:
Accounts
receivable (19.4) (33.0) (60.7) (66.3)
Inventories 6.1 8.9 (4.9) (7.6)
Prepaid expenses
and other
current assets (4.5) (1.2) 25.8 (1.0)
Other assets (1.3) (0.4) (3.7) (0.2)
Accounts payable
and accrued
liabilities,
and other
liabilities 25.2 26.3 10.0 (2.2)
Income taxes
recoverable 1.0 (0.4) 1.6 (0.4)
------------- -------------- ------------- --------------
Net cash
provided by
(used in)
operating
activities 75.7 29.5 74.6 (23.0)
------------- -------------- ------------- --------------
Investing
Activities
Acquisitions, net
of cash received (0.5) (80.8) (0.5) (80.8)
Additions to
property, plant
& equipment (29.9) (11.8) (57.2) (20.6)
Additions to
intangibles and
other assets (0.1) (1.3) (2.2) (2.8)
Proceeds from
sale of
property, plant
& equipment and
sale-leaseback 40.1 - 40.5 -
------------- -------------- ------------- --------------
Net cash
provided by
(used in)
investing
activities 9.6 (93.9) (19.4) (104.2)
------------- -------------- ------------- --------------
Financing
Activities
Payments of long-
term debt (1.1) (296.5) (1.9) (312.5)
Issuance of long-
term debt - 525.0 - 525.0
Borrowings under
ABL 654.1 188.2 748.9 283.2
Payments under
ABL (674.4) (284.3) (777.2) (299.4)
Distributions to
non-controlling
interests (1.6) (2.5) (3.6) (4.8)
Issuance of
common shares 142.5 - 142.6 -
Financing fees (0.2) (7.9) (0.2) (7.9)
Preferred shares
repurchased and
cancelled (148.8) - (148.8) -
Common shares
repurchased and
cancelled - (2.7) (0.7) (3.1)
Dividends to
common and
preferred
shareholders (9.0) (5.7) (18.0) (10.8)
Payment of
deferred
consideration
for acquisitions (2.5) - (2.5) -
------------- -------------- ------------- --------------
Net cash (used
in) provided by
financing
activities (41.0) 113.6 (61.4) 169.7
------------- -------------- ------------- --------------
Effect of exchange
rate changes on
cash 0.2 1.1 (1.0) 1.2
------------- -------------- ------------- --------------
Net increase
(decrease) in
cash & cash
equivalents 44.5 50.3 (7.2) 43.7
Cash & cash
equivalents,
beginning of
period 34.5 40.6 86.2 47.2
------------- -------------- ------------- --------------
Cash & cash
equivalents, end
of period $ 79.0 $ 90.9 $ 79.0 $ 90.9
============= ============== ============= ==============
COTT CORPORATION EXHIBIT 5
SEGMENT INFORMATION - NON-GAAP
(in millions of U.S. dollars)
Unaudited
For the Three Months Ended July 4, 2015
----------------------------------------------------------------------------
(in millions of U.S.
dollars) North America DSS U.K. All Other
----------------------- --------------- ----------- ----------- -----------
Revenue
-----------------------
Private label retail $ 289.7 $ 17.2 $ 71.8 $ 1.7
Branded retail 30.8 20.6 48.5 1.3
Contract packaging 31.3 - 30.9 6.8
Home and office bottled
water delivery - 164.8 - -
Office coffee services - 29.7 - -
Other 7.2 24.7 2.6 6.6
----------------------- --------------- ----------- ----------- -----------
Total $ 359.0 $ 257.0 $ 153.8 $ 16.4
======================= =============== =========== =========== ===========
Operating income (loss) $ 18.3 $ 13.2 $ 14.6 $ 3.7
======================= =============== =========== =========== ===========
For the Three Months Ended June 28, 2014
----------------------------------------------------------------------------
(in millions of U.S.
dollars) North America DSS U.K. All Other
----------------------- --------------- ----------- ----------- -----------
Revenue
-----------------------
Private label retail $ 313.9 $ - $ 79.0 $ 1.8
Branded retail 27.9 - 48.3 1.1
Contract packaging 28.4 - 29.3 7.7
Home and office bottled
water delivery - - - -
Office coffee services - - - -
Other 9.1 - 1.1 7.7
----------------------- --------------- ----------- ----------- -----------
Total $ 379.3 $ - $ 157.7 $ 18.3
----------------------- =============== =========== =========== ===========
Operating income (loss) $ 15.3 $ - $ 10.7 $ 3.1
======================= =============== =========== =========== ===========
For the Six Months Ended July 4, 2015
----------------------------------------------------------------------------
(in millions of U.S.
dollars) North America DSS U.K. All Other
----------------------- --------------- ----------- ----------- -----------
Revenue
-----------------------
Private label retail $ 557.4 $ 32.7 $ 132.7 $ 2.8
Branded retail 57.9 40.3 89.3 2.4
Contract packaging 56.9 - 59.3 10.7
Home and office bottled
water delivery - 314.4 - -
Office coffee services - 61.7 - -
Other 15.5 48.2 4.7 13.5
----------------------- --------------- ----------- ----------- -----------
Total $ 687.7 $ 497.3 $ 286.0 $ 29.4
======================= =============== =========== =========== ===========
Operating income (loss) $ 25.5 $ 11.7 $ 18.5 $ 5.3
======================= =============== =========== =========== ===========
For the Six Months Ended June 28, 2014
----------------------------------------------------------------------------
(in millions of U.S.
dollars) North America DSS U.K. All Other
----------------------- --------------- ----------- ----------- -----------
Revenue
-----------------------
Private label retail $ 613.6 $ - $ 142.5 $ 2.7
Branded retail 53.0 - 79.7 2.3
Contract packaging 48.3 - 49.4 14.5
Home and office bottled
water delivery - - - -
Office coffee services - - - -
Other 15.2 - 1.7 13.6
----------------------- --------------- ----------- ----------- -----------
Total $ 730.1 $ - $ 273.3 $ 33.1
----------------------- =============== =========== =========== ===========
Operating income (loss) $ 17.8 $ - $ 12.9 $ 5.6
======================= =============== =========== =========== ===========
For the Three Months Ended July 4, 2015
---------------------------------------------------------------------------
(in millions of U.S.
dollars) Corporate Elimination Total
--------------------------------------- ---------------- ----------------
Revenue
-----------------------
Private label retail $ - $ (0.7) $ 379.7
Branded retail - (0.5) 100.7
Contract packaging - (1.6) 67.4
Home and office bottled
water delivery - - 164.8
Office coffee services - - 29.7
Other - (3.6) 37.5
--------------------------------------- ---------------- ----------------
Total $ - $ (6.4) $ 779.8
=======================---------------- ================ ================
Operating income (loss)$ (3.7) $ - $ 46.1
======================================= ================ ================
For the Three Months Ended June 28, 2014
---------------------------------------------------------------------------
(in millions of U.S.
dollars) Corporate Elimination Total
--------------------------------------- ---------------- ----------------
Revenue
-----------------------
Private label retail $ - $ (0.3) $ 394.4
Branded retail - (0.5) 76.8
Contract packaging - (1.9) 63.5
Home and office bottled
water delivery - - -
Office coffee services - - -
Other - (3.4) 14.5
--------------------------------------- ---------------- ----------------
Total $ - $ (6.1) $ 549.2
-----------------------================ ================ ================
Operating income (loss)$ (2.9) $ - $ 26.2
======================================= ================ ================
For the Six Months Ended July 4, 2015
---------------------------------------------------------------------------
(in millions of U.S.
dollars) Corporate Elimination Total
--------------------------------------- ---------------- ----------------
Revenue
-----------------------
Private label retail $ - $ (1.2) $ 724.4
Branded retail - (0.9) 189.0
Contract packaging - (1.6) 125.3
Home and office bottled
water delivery - - 314.4
Office coffee services - - 61.7
Other - (7.1) 74.8
--------------------------------------- ---------------- ----------------
Total $ - $ (10.8) $ 1,489.6
=======================---------------- ================ ================
Operating income (loss)$ (8.2) $ - $ 52.8
======================================= ================ ================
For the Six Months Ended June 28, 2014
---------------------------------------------------------------------------
(in millions of U.S.
dollars) Corporate Elimination Total
--------------------------------------- ---------------- ----------------
Revenue
-----------------------
Private label retail $ - $ (0.4) $ 758.4
Branded retail - (0.9) 134.1
Contract packaging - (4.8) 107.4
Home and office bottled
water delivery - - -
Office coffee services - - -
Other - (6.1) 24.4
--------------------------------------- ---------------- ----------------
Total $ - $ (12.2) $ 1,024.3
-----------------------================ ================ ================
Operating income (loss)$ (5.8) $ - $ 30.5
======================================= ================ ================
TRADITIONAL COTT EXHIBIT 6
SUPPLEMENTARY INFORMATION
RECONCILIATION OF NON-GAAP TO GAAP RESULTS
(in millions of U.S. dollars)
Unaudited
For the Three Months Ended July 4, 2015
----------------------------------------------------
Acquisition Unrealized
and and other
Integration Other non-cash
GAAP Expenses Adjustments expenses Non-GAAP
-------- ----------- ----------- ---------- --------
Revenue, net $ 522.8 $ - $ - $ - $ 522.8
Cost of sales 438.4 - - 0.9 439.3
-------- ----------- ----------- ---------- --------
Gross profit 84.4 - - (0.9) 83.5
Selling, general and
administrative
expenses 51.2 - (0.6) - 50.6
(Gain) loss on
disposal of property,
plant & equipment (0.7) - 1.0 (0.3) -
Restructuring - - - - -
Asset impairments - - - - -
Acquisition and
integration expenses 1.0 (1.0) - - -
-------- ----------- ----------- ---------- --------
Operating income 32.9 1.0 (0.4) (0.6) 32.9
Other expense
(income), net 1.2 - - (1.2) -
-------- ----------- ----------- ---------- --------
Income before interest
expense and income
taxes - EBIT 31.7 1.0 (0.4) 0.6 32.9
Depreciation &
Amortization 26.4 26.4
-------- --------
EBITDA - TRADITIONAL
COTT $ 58.1 $ 59.3
======== ========
For the Six Months Ended July 4, 2015
----------------------------------------------------
Acquisition Unrealized
and and other
Integration Other non-cash
GAAP Expenses Adjustments expenses Non-GAAP
-------- ----------- ----------- ---------- --------
Revenue, net $ 992.3 $ - $ - $ - $ 992.3
Cost of sales 846.5 - - 1.2 847.7
-------- ----------- ----------- ---------- --------
Gross profit 145.8 - - (1.2) 144.6
Selling, general and
administrative
expenses 102.4 - (0.6) - 101.8
(Gain) loss on
disposal of property,
plant & equipment (0.4) - 1.0 (0.7) (0.1)
Restructuring - - - - -
Asset impairments - - - - -
Acquisition and
integration expenses 2.7 (2.7) - - -
-------- ----------- ----------- ---------- --------
Operating income 41.1 2.7 (0.4) (0.5) 42.9
Other (income)
expense, net (9.0) - - 9.5 0.5
-------- ----------- ----------- ---------- --------
Income before interest
expense and income
taxes - EBIT 50.1 2.7 (0.4) (10.0) 42.4
Depreciation &
Amortization 53.6 53.6
-------- --------
EBITDA - TRADITIONAL
COTT $ 103.7 $ 96.0
======== ========
For the Three Months Ended June 28, 2014
----------------------------------------------------
Acquisition Unrealized
and and other
Integration Other non-cash
GAAP Expenses Adjustments expenses Non-GAAP
-------- ----------- ----------- ---------- --------
Revenue, net $ 549.2 $ - $ - $ - $ 549.2
Cost of sales 470.2 (1.2) - - 469.0
-------- ----------- ----------- ---------- --------
Gross profit 79.0 1.2 - - 80.2
Selling, general and
administrative
expenses 50.7 - (0.2) - 50.5
(Gain) loss on
disposal of property,
plant & equipment (0.1) - - - (0.1)
Restructuring 0.1 - (0.1) - -
Asset impairments 0.3 - (0.3) - -
Acquisition and
integration expenses 1.8 (1.8) - - -
-------- ----------- ----------- ---------- --------
Operating income 26.2 3.0 0.6 - 29.8
Other expense
(income), net 19.8 - (19.6) (0.7) (0.5)
-------- ----------- ----------- ---------- --------
Income before interest
expense and income
taxes - EBIT 6.4 3.0 20.2 0.7 30.3
Depreciation &
Amortization 25.8 25.8
-------- --------
EBITDA - TRADITIONAL
COTT $ 32.2 $ 56.1
======== ========
For the Six Months Ended June 28, 2014
----------------------------------------------------
Acquisition Unrealized
and and other
Integration Other non-cash
GAAP Expenses Adjustments expenses Non-GAAP
-------- ----------- ----------- ---------- --------
Revenue, net $1,024.3 $ - $ - $ - $1,024.3
Cost of sales 889.1 (1.2) - - 887.9
-------- ----------- ----------- ---------- --------
Gross profit 135.2 1.2 - - 136.4
Selling, general and
administrative
expenses 97.6 - (0.3) - 97.3
(Gain) loss on
disposal of property,
plant & equipment - - - (0.1) (0.1)
Restructuring 2.3 - (2.3) - -
Asset impairments 1.9 - (1.9) - -
Acquisition and
integration expenses 2.9 (2.9) - - -
-------- ----------- ----------- ---------- --------
Operating income 30.5 4.1 4.5 0.1 39.2
Other (income)
expense, net 17.5 3.5 (20.5) (1.3) (0.8)
-------- ----------- ----------- ---------- --------
Income before interest
expense and income
taxes - EBIT 13.0 0.6 25.0 1.4 40.0
Depreciation &
Amortization 50.9 50.9
-------- --------
EBITDA - TRADITIONAL
COTT $ 63.9 $ 90.9
======== ========
DS SERVICES EXHIBIT 7
SUPPLEMENTARY INFORMATION
RECONCILIATION OF NON-GAAP TO GAAP RESULTS
(in millions of U.S. dollars)
Unaudited
For the Three Months Ended July 4, 2015
------------------------------------------------------
Acquisition Unrealized
and Other and other
Integration Adjustments non-cash
GAAP Expenses (1) expenses Non-GAAP
-------- ----------- ------------ ---------- ---------
Revenue, net $ 257.0 $ - $ 2.3 $ - $ 259.3
Cost of sales 100.8 - - - 100.8
-------- ----------- ------------ ---------- ---------
Gross profit 156.2 - 2.3 - 158.5
Selling, general and
administrative
expenses 139.0 - 2.3 - 141.3
Loss on disposal of
property, plant &
equipment 0.9 - - (0.9) -
Acquisition and
integration expenses 3.1 (3.1) - - -
-------- ----------- ------------ ---------- ---------
Operating income 13.2 3.1 - 0.9 17.2
Other income, net (0.2) - - 0.2 -
-------- ----------- ------------ ---------- ---------
Income before
interest expense and
income taxes - EBIT 13.4 3.1 - 0.7 17.2
Depreciation &
Amortization 31.8 31.8
-------- ---------
EBITDA - DS SERVICES $ 45.2 $ 49.0
======== =========
For the Six Months Ended July 4, 2015
------------------------------------------------------
Acquisition Unrealized
and Other and other
Integration Adjustments non-cash
GAAP Expenses (1) expenses Non-GAAP
-------- ----------- ------------ ---------- ---------
Revenue, net $ 497.3 $ 0.9 $ 3.4 $ - $ 501.6
Cost of sales 201.2 (3.3) - - 197.9
-------- ----------- ------------ ---------- ---------
Gross profit 296.1 4.2 3.4 - 303.7
Selling, general and
administrative
expenses 276.3 - 3.4 - 279.7
Loss on disposal of
property, plant &
equipment 2.0 - - (2.0) -
Acquisition and
integration expenses 6.1 (6.1) - - -
-------- ----------- ------------ ---------- ---------
Operating income 11.7 10.3 - 2.0 24.0
Other income, net (0.4) - - 0.4 -
-------- ----------- ------------ ---------- ---------
Income before
interest expense and
income taxes - EBIT 12.1 10.3 - 1.6 24.0
Depreciation &
Amortization 62.0 62.0
-------- ---------
EBITDA - DS SERVICES $ 74.1 $ 86.0
======== =========
Proforma
-----------------------------------------------------
For the Three Months Ended June 28, 2014
-----------------------------------------------------
Acquisition Unrealized
and and other
Integration Other non-cash
GAAP Expenses Adjustments expenses Non-GAAP
-------- ----------- ----------- ---------- --------
Revenue, net $ 251.4 $ - $ - $ - $ 251.4
Cost of sales 101.9 - - - 101.9
-------- ----------- ----------- ---------- --------
Gross profit 149.5 - - - 149.5
Selling, general and
administrative
expenses 134.5 (0.7) (0.3) (0.7) 132.8
Loss on disposal of
property, plant &
equipment - - - - -
Acquisition and
integration expenses - - - - -
-------- ----------- ----------- ---------- --------
Operating income 15.0 0.7 0.3 0.7 16.7
Other income, net (0.2) - - - (0.2)
-------- ----------- ----------- ---------- --------
Income before
interest expense and
income taxes - EBIT 15.2 0.7 0.3 0.7 16.9
Depreciation &
Amortization 28.7 28.7
-------- --------
EBITDA - DS SERVICES $ 43.9 $ 45.6
======== ========
Proforma
-----------------------------------------------------
For the Six Months Ended June 28, 2014
-----------------------------------------------------
Acquisition Unrealized
and and other
Integration Other non-cash
GAAP Expenses Adjustments expenses Non-GAAP
-------- ----------- ----------- ---------- --------
Revenue, net $ 481.9 $ - $ - $ - $ 481.9
Cost of sales 197.1 - - - 197.1
-------- ----------- ----------- ---------- --------
Gross profit 284.8 - - - 284.8
Selling, general and
administrative
expenses 269.4 (2.1) (2.8) (1.3) 263.2
Loss on disposal of
property, plant &
equipment - - - - -
Acquisition and
integration expenses - - - - -
-------- ----------- ----------- ---------- --------
Operating income 15.4 2.1 2.8 1.3 21.6
Other income, net (0.5) - - - (0.5)
-------- ----------- ----------- ---------- --------
Income before
interest expense and
income taxes - EBIT 15.9 2.1 2.8 1.3 22.1
Depreciation &
Amortization 56.2 56.2
-------- --------
EBITDA - DS SERVICES $ 72.1 $ 78.3
======== ========
(1) Represents the impact of energy fuel surchage rate on current year
operations assuming prior year average rate.
(1) Represents the impact of energy fuel surchage rate on current year
operations assuming prior year average rate.
NORTH AMERICA EXHIBIT 8
SUPPLEMENTARY INFORMATION
RECONCILIATION OF NON-GAAP TO GAAP RESULTS
(in millions of U.S. dollars)
Unaudited
For the Three Months Ended July 4, 2015
-----------------------------------------------------------
Acquisition Unrealized
and and other
Integration Other non-cash
GAAP Expenses Adjustments expenses Non-GAAP
--------- ----------- ----------- ----------- ---------
Revenue, net $ 352.6 $ - $ - $ - $ 352.6
Intercompany
sales 6.4 - - - 6.4
--------- ----------- ----------- ----------- ---------
BU Revenue, net 359.0 - - - 359.0
Cost of sales 306.9 - - 1.0 307.9
--------- ----------- ----------- ----------- ---------
Gross profit 52.1 - - (1.0) 51.1
Selling, general
and
administrative
expenses 34.0 - (0.5) - 33.5
(Gain) loss on
disposal of
property, plant
& equipment (0.7) - 1.0 (0.3) -
Restructuring - - - - -
Asset
impairments - - - - -
Acquisition and
integration
expenses 0.5 (0.5) - - -
--------- ----------- ----------- ----------- ---------
Operating income 18.3 0.5 (0.5) (0.7) 17.6
Other expense
(income), net 0.3 - - (0.3) -
--------- ----------- ----------- ----------- ---------
Income before
interest
expense and
income taxes -
EBIT 18.0 0.5 (0.5) (0.4) 17.6
Depreciation &
Amortization 20.5 20.5
--------- ---------
EBITDA - NORTH
AMERICA $ 38.5 $ 38.1
========= =========
For the Three Months Ended June 28, 2014
-----------------------------------------------------------
Acquisition Unrealized
and and other
Integration Other non-cash
GAAP Expenses Adjustments expenses Non-GAAP
--------- ----------- ----------- ----------- ---------
Revenue, net $ 373.2 $ - $ - $ - $ 373.2
Intercompany
sales 6.1 - - - 6.1
--------- ----------- ----------- ----------- ---------
BU Revenue, net 379.3 - - - 379.3
Cost of sales 330.5 - - - 330.5
--------- ----------- ----------- ----------- ---------
Gross profit 48.8 - - - 48.8
Selling, general
and
administrative
expenses 33.4 - (0.2) - 33.2
(Gain) loss on
disposal of
property, plant
& equipment (0.1) - - - (0.1)
Restructuring 0.1 - (0.1) - -
Asset
impairments - - - - -
Acquisition and
integration
expenses 0.1 (0.1) - - -
--------- ----------- ----------- ----------- ---------
Operating income 15.3 0.1 0.3 - 15.7
Other expense
(income), net 0.6 - - (0.6) -
--------- ----------- ----------- ----------- ---------
Income before
interest
expense and
income taxes -
EBIT 14.7 0.1 0.3 0.6 15.7
Depreciation &
Amortization 20.5 20.5
--------- ---------
EBITDA - NORTH
AMERICA $ 35.2 $ 36.2
========= =========
For the Six Months Ended July 4, 2015
-----------------------------------------------------------
Acquisition Unrealized
and and other
Integration Other non-cash
GAAP Expenses Adjustments expenses Non-GAAP
--------- ----------- ----------- ----------- ---------
Revenue, net $ 676.9 $ - $ - $ - $ 676.9
Intercompany
sales 10.8 - - - 10.8
--------- ----------- ----------- ----------- ---------
BU Revenue, net 687.7 - - - 687.7
Cost of sales 594.0 - - 1.0 595.0
--------- ----------- ----------- ----------- ---------
Gross profit 93.7 - - (1.0) 92.7
Selling, general
and
administrative
expenses 66.6 - (0.5) - 66.1
(Gain) loss on
disposal of
property, plant
& equipment (0.4) - 1.0 (0.6) -
Restructuring - - - - -
Asset
impairments - - - - -
Acquisition and
integration
expenses 2.0 (2.0) - - -
--------- ----------- ----------- ----------- ---------
Operating income 25.5 2.0 (0.5) (0.4) 26.6
Other expense
(income), net 0.5 - - (0.5) -
--------- ----------- ----------- ----------- ---------
Income before
interest
expense and
income taxes -
EBIT 25.0 2.0 (0.5) 0.1 26.6
Depreciation &
Amortization 41.9 41.9
--------- ---------
EBITDA - NORTH
AMERICA $ 66.9 $ 68.5
========= =========
For the Six Months Ended June 28, 2014
-----------------------------------------------------------
Acquisition Unrealized
and and other
Integration Other non-cash
GAAP Expenses Adjustments expenses Non-GAAP
--------- ----------- ----------- ----------- ---------
Revenue, net $ 717.9 $ - $ - $ - $ 717.9
Intercompany
sales 12.2 - - - 12.2
--------- ----------- ----------- ----------- ---------
BU Revenue, net 730.1 - - - 730.1
Cost of sales 643.3 - - - 643.3
--------- ----------- ----------- ----------- ---------
Gross profit 86.8 - - - 86.8
Selling, general
and
administrative
expenses 65.1 - (0.2) - 64.9
(Gain) loss on
disposal of
property, plant
& equipment (0.1) - - - (0.1)
Restructuring 2.2 - (2.2) - -
Asset
impairments 0.9 - (0.9) - -
Acquisition and
integration
expenses 0.9 (0.9) - - -
--------- ----------- ----------- ----------- ---------
Operating income 17.8 0.9 3.3 - 22.0
Other expense
(income), net 0.7 - - (0.8) (0.1)
--------- ----------- ----------- ----------- ---------
Income before
interest
expense and
income taxes -
EBIT 17.1 0.9 3.3 0.8 22.1
Depreciation &
Amortization 41.1 41.1
--------- ---------
EBITDA - NORTH
AMERICA $ 58.2 $ 63.2
========= =========
COTT CORPORATION EXHIBIT 9
SUPPLEMENTARY INFORMATION - NON-GAAP - Analysis of Revenue by
Reporting Segment
Unaudited
--------------- ------------------------------------------------------------
(in millions of
U.S. dollars,
except
percentage
amounts) For the Three Months Ended July 4, 2015
--------------- -----------------------------------------------------------
North All
America DSS U.K. Other Elimination Total
--------------- -------- -------- ----- -------- ----------- ---------
Change in
revenue $ (20.3) $ 257.0 $(3.9) $ (1.9) $ (0.3) $ 230.6
Impact of
foreign
exchange(1) 5.2 - 14.8 1.3 - 21.3
-------- -------- ----- -------- ----------- ---------
Change
excluding
foreign
exchange $ (15.1) $ 257.0 $10.9 $ (0.6) $ (0.3) $ 251.9
-------- -------- ----- -------- ----------- ---------
Percentage
change in
revenue -5.4% - -2.5% -10.4% 4.9% 42.0%
-------- -------- ----- -------- ----------- ---------
Percentage
change in
revenue
excluding
foreign
exchange -4.0% - 6.9% -3.3% 4.9% 45.9%
-------- -------- ----- -------- ----------- ---------
Impact of DSS
Acquisition $ (1.6) $ (257.0) $ - $ - $ 1.6 $ (257.0)
-------- -------- ----- -------- ----------- ---------
Change
excluding
foreign
exchange and
DSS
Acquisition $ (16.7) $ - $10.9 $ (0.6) $ 1.3 $ (5.1)
-------- -------- ----- -------- ----------- ---------
Percentage
change in
revenue
excluding
foreign
exchange and
DSS
Acquisition -4.4% - 6.9% -3.3% -21.3% -0.9%
-------- -------- ----- -------- ----------- ---------
--------------- -----------------------------------------------------------
(in millions of
U.S. dollars,
except
percentage
amounts) For the Six Months Ended July 4, 2015
--------------- -----------------------------------------------------------
North All
America DSS U.K. Other Elimination Total
--------------- -------- -------- ----- ------- ----------- ---------
Change in
revenue $ (42.4) $ 497.3 $12.7 $ (3.7) $ 1.4 $ 465.3
Impact of
foreign
exchange(1) 8.6 - 27.0 2.0 - 37.6
-------- -------- ----- ------- ----------- ---------
Change
excluding
foreign
exchange $ (33.8) $ 497.3 $39.7 $ (1.7) $ 1.4 $ 502.9
-------- -------- ----- ------- ----------- ---------
Percentage
change in
revenue -5.8% - 4.6% -11.2% -11.5% 45.4%
-------- -------- ----- ------- ----------- ---------
Percentage
change in
revenue
excluding
foreign
exchange -4.6% - 14.5% -5.1% -11.5% 49.1%
-------- -------- ----- ------- ----------- ---------
Impact of DSS
Acquisition $ (1.6) $ (497.3) $ - $ - $ 1.6 $ (497.3)
-------- -------- ----- ------- ----------- ---------
Change
excluding
foreign
exchange and
DSS
Acquisition $ (35.4) $ - $39.7 $ (1.7) $ 3.0 $ 5.6
-------- -------- ----- ------- ----------- ---------
Percentage
change in
revenue
excluding
foreign
exchange and
DSS
Acquisition -4.8% - 14.5% -5.1% -24.6% 0.5%
-------- -------- ----- ------- ----------- ---------
(1) Impact of foreign exchange is the difference between the current year's
revenue translated utilizing the current year's average
foreign exchange rates less the current year's revenue translated utilizing
the prior year's average foreign exchange rates.
COTT CORPORATION EXHIBIT 10
SUPPLEMENTARY INFORMATION - NON-GAAP - FREE CASH FLOW AND ADJUSTED FREE
CASH FLOW
(in millions of U.S. dollars)
Unaudited
For the Three Months Ended
----------------------------
July 4, 2015 June 28, 2014
------------- -------------
Net cash provided by operating activities $ 75.7 $ 29.5
Less: Capital expenditures (29.9) (11.8)
------------- -------------
Free Cash Flow $ 45.8 $ 17.7
============= =============
Plus: Bond redemption cash costs - 16.4
------------- -------------
Adjusted Free Cash Flow $ 45.8 $ 34.1
============= =============
For the Six Months Ended
----------------------------
June 28,
July 4, 2015 2014
------------- -------------
Net cash provided by (used in) operating
activities $ 74.6 $ (23.0)
Less: Capital expenditures (57.2) (20.6)
------------- -------------
Free Cash Flow $ 17.4 $ (43.6)
============= =============
Plus: Bond redemption cash costs - 17.0
Less: Cash collateral (1) (29.4) -
------------- -------------
Adjusted Free Cash Flow $ (12.0) $ (26.6)
============= =============
(1) In connection with the DSS Acquisition, $29.4 million was required to
cash collateralize certain DSS self-insurance programs. The $29.4 million
was funded with borrowings against our ABL facility, and the cash
collateral was included within prepaid and other current assets on our
Consolidated Balance Sheet at January 3, 2015. Subsequent to January 3,
2015 additional letters of credit were issued from our available ABL
facility capacity, and the cash collateral was returned to the Company,
which was used to repay a portion of our outstanding ABL facility.
CONTACT: Jarrod Langhans Investor Relations Tel: (813) 313-1732 Email Contact
Source: Cott Corporation
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