Lassonde Q2 profit slips to $11.2 million on higher private label sales

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ROUGEMONT, Que. – Fruit juice maker Lassonde Industries Inc. says its net income attributable to shareholders slipped to $11.2 million in the second quarter despite a 5.4 per cent increase in revenues.

The Quebec-based company says it earned $1.61 per share for the period ended June 28, compared to $1.63 per share or $11.4 million a year earlier.

Revenues increased to $272.4 million from $258.55 million, primarily due to higher private label sales and favourable currency partially offset by lower sales volume of national brands in Canada.

During the quarter, the company acquired Apple & Eve, a leading U.S. independent branded juice company for US$150 million, it claims will fuel growth by entering the U.S. branded juice market.

Operating profit increased 10.5 per cent to $21.9 million due to the improving profitability of Clement Pappas private label products and lower selling and administrative expenses.

Lassonde (TSX:LAS.A) says “sluggish” demand growth is continuing to impact sales volumes for North American products, while increased competition in Canada is lower prices and sales volumes of its national brands.

The company says it doesn’t foresee competition diminishing over the next two quarters.

However, it expects to maintain a slight sales growth due to the performance of private label products and a lower Canadian dollar.

“The 2014 second quarter results reflect a combined impact of solid performance by our U.S. subsidiary and difficult market conditions in Canada,” stated chairman and CEO Pierre-Paul Lassonde.

Lassonde offers more than 100 juice products sold under its flagship brand name, Apple & Eve, along with Organics, Fruitables, Quenchers, Waterfruits and Sesame Street. It also owns and markets juices under Northland, Seneca and The Switch brands.

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