Farmer Bros (FARM 27.95, -0.45, -1.58%) is lower after
reporting weaker than expected quarterly results.
The supplier and distributor of coffee reported below-consensus fourth quarter earnings of breakeven on revenue, which rose 11.7% year/year to $149.50 mln, but was shy of market expectations.
Boyd Coffee, which was acquired in August 2017, contributed $18.20 mln to the company's quarterly revenue.
Processed coffee volume grew 17.7% year/year to 27.4 mln pounds while gross margin improved by 320 basis points to 35.2%. The improvement was fueled by lower coffee prices in the fourth quarter of 2018 when compared to the same quarter one year ago.
Farmer Bros President and CEO Mike Keown said that the company expanded its distribution network, added new customers, and increased its business with current customers during the fourth quarter.
Roughly 12.0% of the company's total coffee volume for the fiscal year was owed to the 2017 acquisition of Boyd Coffee. Adjusted EBITDA margin improved to 9.3% from 5.1% one year ago.
The company processed and sold 9.00 mln pounds of green coffee through its distribution network, which made up 32.7% of total green coffee pounds processed and sold. Sales directly to customers made up 66.0% (or 18.1 mln pounds) of total green coffee pounds processed and sold. Sales to distributors made up 1.3% (or 400,000 pounds) of total green coffee sales.
- OUR VIEW
- LEARNING CENTER