CANADA: Cott Corp full-year profits plunge
Cott Corporation has seen full-year earnings hit by charges related to a restructuring of its operations in North America.
The world's largest producer of own-label soft drinks said today (26 January) that net income for the year was hit by charges for unusual items of US$37.5m following its North American realignment programme. Net income came in at US$24.6m, down from US$78.3m in 2004.
"2005 was a challenging year for Cott and our industry as we faced unprecedented commodity cost increases and a continuing consumer shift toward non-carbonated beverages," said John K. Sheppard, president and chief executive officer.
"We are taking actions that we expect will drive sales growth and significantly improve our operating performance as we move beyond this transition year."
Full-year sales, however, were up by 7% to US$1.8bn. Sales in the UK and Europe in 2005 were up by 30% year-on-year, while North American sales rose slightly, by 3% primarily due to pricing, acquisitions and foreign exchange, as volumes declined slightly.
International sales were driven by strong growth in Mexico, with sales increasing by 17%.
For the fourth quarter of 2005, Cott's sales grew to US$397.2m, an increase of 8% over the same period in 2004, up 1% excluding acquisitions and foreign exchange.
Looking forward, Cott expects EBITDA for this year to be relatively flat with 2005. "2006 will be an important transition year as we reposition Cott for profitable growth in the future," Sheppard added.
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