Total revenue increased 45% to $25.9m in the third quarter of fiscal 2010, from $17.9m in the third quarter of fiscal 2009, led by a 55% or $8.7m increase in K-Cup sales.
Gross margin in the third quarter of fiscal 2010 increased to 26.8% of total revenue as compared to 25.6% during the same period of last year. In addition to price increases taken during fiscal 2010, the improvement resulted from Diedrich Coffee’s continuing ability to leverage fixed manufacturing costs over higher production volumes.
Net loss totalled $778,000 or $(0.14) per basic and diluted share in the third quarter of fiscal 2010, as compared to net income of $1,358,000 or $0.25 per basic and diluted share in the third quarter of fiscal 2009.
Net loss in the third quarter of fiscal 2010 included approximately $1.6m in merger-related costs and an increase of $2.1m of non-cash stock compensation expense.
Adjusted net income (a non-GAAP financial measure) was $3.3m or $0.41 per diluted share in the third quarter of fiscal year 2010, an improvement from an adjusted net income of $1.4m or $0.25 per diluted share in the same quarter of the prior year.
Adjusted net income represents net income or loss before merger related costs, non-cash stock compensation expense, severance expenses related to the departure of Diedrich Coffee’s former CEO, J Russell Phillips, loss from discontinued operations and the timing of the fiscal 2009 accrual for management incentive compensation.
As announced on 8 December 2009, Diedrich Coffee entered into a definitive agreement under which Green Mountain Coffee Roasters Inc will acquire all of the outstanding common stock of Diedrich Coffee in an all-cash transaction valued at $35 per share or a total transaction value of approximately $290m pursuant to a cash tender offer by GMCR’s wholly owned subsidiary, Pebbles Acquisition Sub Inc, which is currently scheduled to expire on 3 May 2010.
Source: Diedrich Coffee
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