US: Dismal Q4 undoes full-year for Cott Corp.
Cott Corporation has seen "an extreme commodity environment" hammer its fourth quarter and full-year results.
The US own-label soft drinks company said today (8 February) that net loss in 2007 soared to US$73.1m from $17.5m in 2006. For the final quarter, net loss more than doubled to $76.8m from $29.6m in the corresponding period a year earlier.
The losses in the full-year came despite flat sales of $1.78bn from $1.77bn. The company saw restructuring, assets impairment and other charges leap in the year to $90.8m from $38.5m a year earlier. Full-year operating loss was $57.1m, as compared to income of $2.3m in the prior year.
"In 2007, we were impacted by an extreme commodity environment, CSD decline in North America, higher competitive promotional activities, and various internal challenges that prevented us from achieving our objectives," said Cott's CEO, Brent Willis. "This very difficult year is now behind us, and most importantly, in 2007, we took essential steps to remake the company in various areas, such as people, structure, process changes, product manufacturing capability, pricing and cost management.
"We expect these initiatives to significantly improve our performance in 2008."
In the final quarter, international volume growth of 41.1% was partially offset by a 4.8% decline in North America. The slide in the continent was blamed on continued softness in the CSD segment. International growth, meanwhile, was driven by increased concentrate sales in advance of higher pricing taking effect in 2008, in addition to core volume growth in the UK.
In September, Cott lowered its 2007 forecasts in response to market volume declines in key markets, increased promotional activity by national brands, and the continuing impact of commodity costs not sufficiently offset in the short term by growth and cost-cutting initiatives.
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