Coca-Cola Bottling Co. Consolidated announced it earned $9.8 million, or basic net income per share of $1.06, on net sales of $405.9 million for the third quarter of 2011, compared to net income of $15.5 million, or basic net income per share of $1.69, on net sales of $395.4 million for the third quarter of 2010. The results for the third quarter of 2011 included $1.1 million of after-tax losses ($1.8 million on a pre-tax basis) due to mark-to-market adjustments on fuel and aluminum hedges and $0.9 million of after-tax gains related to changes in reserves for uncertain tax positions. The results for the third quarter of 2010 included $1.9 million of after-tax gains ($3.1 million on a pre-tax basis) due to mark-to-market adjustments on fuel and aluminum hedges, $0.2 million after-tax gain ($0.3 million on a pre-tax basis) from insurance recoveries on assets lost or damaged due to the Nashville, Tenn. area flood in May 2010 and $1.7 million of after-tax gains related to changes in reserves for uncertain tax positions.
On a comparable basis, the company earned $10.0 million in the third quarter of 2011, or comparable basic net income per share of $1.09, versus $12.0 million in the third quarter of 2010, or comparable basic net income per share of $1.31.
The company earned $26.8 million, or basic net income per share of $2.91, on net sales of $1,188.4 million for the first nine months of 2011, compared to net income of $32.2 million, or basic net income per share of $3.51, on net sales of $1,160.2 million for the first nine months of 2010. The results for the first nine months of 2011 included $2.6 million of after-tax losses ($4.2 million on a pre-tax basis) due to mark-to-market adjustments on fuel and aluminum hedges and $0.9 million of after-tax gains related to changes in reserves for uncertain tax positions. The results for the first nine months of 2010 included $2.7 million of after-tax losses ($4.5 million on a pre-tax basis) due to mark-to-market adjustments on fuel and aluminum hedges, $0.5 million after-tax gain ($0.9 million on a pre-tax basis) from the impact of the Nashville flood, $0.5 million increase in tax expense due to the change in tax law eliminating the tax deduction once available for Medicare Part D subsidies and $1.7 million of after-tax gains related to changes in reserves for uncertain tax positions.
On a comparable basis, the company earned $28.6 million in the first nine months of 2011, or comparable basic net income per share of $3.11, versus $33.3 million in the first nine months of 2010, or comparable basic net income per share of $3.63.
J. Frank Harrison, III, chairman and CEO, said in a prepared statement, “In what continues to be a very challenging environment, we are pleased that the company has been able to increase revenue for both the third quarter and year to date. 2011 has been a challenging year as the economy remains weak and commodity costs continue to increase at rates that exceed the rate of inflation. Despite these challenges, we are pleased with our results in 2011 and remain focused on finding ways to bring value to our customers and grow profitably.”
William B. Elmore, president and COO, added, “The trends that we experienced in the first half of 2011 continued in the third quarter. Consumers are cautious and value oriented in their purchasing decisions. This becomes even more challenging as raw material costs continue to rise. We have seen strength in our more value oriented channels such as food and dollar stores and weakness in the convenience and on-premise channels. The migration to lower margin channels is reflected in a lower gross margin percentage for both the third quarter and first nine months of 2011. We continuously review our price and package mix in our efforts to maximize gross margin, however, in such a highly competitive market, we cannot always pass along all of our cost increases immediately.”
