Green Mountain earnings beat, revenue falls short

Green Mountain Coffee
Herb Swanson | Bloomberg | Getty Images
Green Mountain Coffee

Green Mountain Coffee reported earnings that beat Wall Street forecasts on lower coffee costs and strong sales of its single serve K-Cups, but the stock is tumbling in late trading on weaker-than-forecast sales.

The coffee maker reported fiscal third-quarter net income of $116.4 million, up 59 percent from the $73.3 million reported a year earlier.

Excluding items, earnings came in at 82 cents per share, beating Wall Street forecasts for 77 cents per share and up from 52 cents per share a year earlier.

Revenue was a bit lighter than forecasts, however. The company posted an 11 percent rise in sales to $967.1 million from $869.2 million a year earlier, pressured by weakness in Canada. Analysts had modeled revenue of $981 million in the quarter.

While sales of its single-serve K-Cups rose 18 percent to $751.7 million in the quarter, sales of brewers and accessories fell 4 percent and sales of other products and royalties declined 11 percent.

Investors have watched Green Mountain closely after its K-Cup patents expired nearly a year ago, and many have wondered if the company can continue to grow as competition in the single-serve coffee industry rises.

For the fourth quarter, Green Mountain sees an 11 percent to 15 percent rise in sales and earnings per share of 69 cents to 74 cents per share. Analysts were looking for 72 cents per share, according to Thomson Reuters.

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