UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16
OF THE SECURITIES EXCHANGE ACT OF 1934
For the month of February 2016
Commission File Number: 001-34929
SodaStream International Ltd.
(Translation of Registrant’s Name
into English)
Gilboa Street, Airport City
Ben Gurion Airport 70100, Israel
(Address of Principal Executive Office)
Indicate by check mark whether the registrant files or will
file annual reports under cover of Form 20-F or Form 40-F: Form 20-F þ Form 40-F
o
Indicate by check mark if the registrant is submitting the Form
6-K in paper as permitted by Regulation S-T Rule 101(b)(1): Yes o No þ
Indicate by check mark if the registrant is submitting the Form
6-K in paper as permitted by Regulation S-T Rule 101(b)(7): Yes o No þ
EXPLANATORY NOTE
On February 18, 2016, SodaStream International
Ltd. (the “Company”) issued a press release announcing its fourth quarter and full fiscal year results for the period
ending December 31, 2015. A copy of the press release is furnished as Exhibit 99.1 herewith.
In conjunction with the conference call
being held on February 18, 2016, the Company also is releasing commentary from its Chief Financial Officer and a PowerPoint presentation
with additional information, furnished herewith as Exhibit 99.2 and Exhibit 99.3, respectively.
Other than as indicated below, the information
in this Form 6-K (including in Exhibits 99.1, 99.2 and 99.3) shall not be deemed “filed” for purposes of Section 18
of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) or otherwise subject to the liabilities of
that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the
Exchange Act.
The condensed consolidated balance sheets,
the International Financial Reporting Standards information contained in the condensed consolidated statements of operations and
the condensed consolidated statement of cash flows contained in the press release attached as Exhibit 99.1 to this Report on Form
6-K are hereby incorporated by reference into the Company’s Registration Statements on Form S-8 (File Nos. 333-195578, 333-190655,
333-170299 and 333-208811).
SIGNATURES
Pursuant to the requirements of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
|
SODASTREAM INTERNATIONAL LTD.
(Registrant)
|
Date: February 18, 2016 |
By: |
/s/ Dotan Bar-Natan |
|
|
Dotan Bar-Natan |
|
|
Head of Legal Department |
EXHIBIT INDEX
Exhibit |
Description |
|
|
99.1 |
Press release dated February 18, 2016. |
|
|
99.2 |
Commentary from the Chief Financial Officer of the Registrant. |
|
|
99.3 |
PowerPoint presentation with additional information. |
|
|
Exhibit 99.1
SODASTREAM REPORTS FOURTH QUARTER FISCAL
2015 RESULTS
AIRPORT CITY, Israel - February 18,
2016 - SodaStream International Ltd. (NASDAQ: SODA), the leading manufacturer of home beverage carbonation systems, announced
today its results for the three months and year ended December 31, 2015.
For the fourth quarter ended December 31,
2015, on an Adjusted basis (including comparative figures) *
| · | Revenue was $112.9 million compared to $126.5 million
in the fourth quarter 2014; Revenue on a constant currency basis was $124.4 million |
| · | Adjusted operating income was $6.2 million compared
to $8.1 million in the fourth quarter 2014; Adjusted operating income on a constant currency basis was $11.5 million |
| · | Adjusted operating income excluding shares-based payment
and on a constant currency basis increased 176% to $14.2 million compared to $5.1 million in the fourth quarter 2014 |
| · | Adjusted EBITDA was $10.5 million compared to $16.4
million in the fourth quarter 2014; Adjusted EBITDA on a constant currency basis was $15.9 million |
| · | Adjusted net income was $5.0 million compared to $7.5
million in the fourth quarter 2014 |
| · | Adjusted diluted earnings per share were $0.24 compared
to $0.35 in the fourth quarter 2014 |
*Adjusted revenue, Adjusted operating income,
Adjusted net income and Adjusted diluted earnings per share are non-IFRS financial measures that eliminate the effect of restructuring
costs, which include $2.2 million of pre-tax charges incurred as part of the company’s restructuring and growth plan announced
on October 29, 2014. These charges represent the final restructuring costs incurred in connection with this plan and were related
primarily to activities associated with the transition to the new Lehavim plant in southern Israel which increased cost of revenue.
Adjusted EBITDA represents earnings before financial expense (income), income tax, depreciation and amortization, and further eliminates
the effect of restructuring costs. Reconciliations of the non-IFRS measures included in this press release to the IFRS results
are included at the end of this press release.
Daniel Birnbaum, Chief Executive Officer
of SodaStream, commented, “The past year was a period of significant change as we sought to set the company on a course for
renewed growth moving forward. We began repositioning SodaStream as a healthy water brand and launched our new portfolio of enhanced
better-for-you flavors, completed the consolidation of our manufacturing base in our new state-of-the-art plant in Lehavim, and reconfigured
our regional management structure including new leadership in key markets. During the fourth quarter, we began to witness the benefits
of our efforts to create a stronger, more efficient organization and capture the market opportunity as consumers rapidly shift
from sugared soft drinks to healthier water-based products. Fourth quarter sales were up sequentially and roughly flat year-over-year
on a constant currency basis, while operating income was ahead of plan as we meaningfully leveraged selling and marketing expenses.
There is still work ahead of us in order to position the company for consistent profitable growth, but I am confident that our
recent actions have us heading in the right direction and will create value for shareholders over the long-term.”
Fourth Quarter 2015 Financial Review
(The financial review relates to the Non-IFRS Consolidated Statements
of Operations. All U.S. dollar values are in accordance with IFRS unless stated otherwise.)
Geographical Revenue Breakdown Revenue | |
Three Months Ended | | |
| | |
| |
| |
December 31, 2014 | | |
December 31, 2015 | | |
(Decrease) | | |
(Decrease) | |
| |
In Millions USD | | |
% | |
Western Europe | |
$ | 66.9 | | |
$ | 63.2 | | |
$ | (3.7 | ) | |
| (5.4 | )% |
The Americas | |
| 37.2 | | |
| 30.0 | | |
| (7.2 | ) | |
| (19.3 | )% |
Asia-Pacific | |
| 16.4 | | |
| 13.7 | | |
| (2.7 | ) | |
| (16.8 | )% |
Central & Eastern Europe, Middle East, Africa | |
| 6.0 | | |
| 6.0 | | |
| (0.0 | ) | |
| (0.5 | )% |
Total | |
$ | 126.5 | | |
$ | 112.9 | | |
$ | (13.6 | ) | |
| (10.7 | )% |
Geographical Revenue Breakdown - constant currency basis Revenue | |
Three Months Ended | | |
| | |
| |
| |
December 31,
2014 | | |
December 31,
2015 - at
Q4-2014
average rates | | |
Increase (Decrease) | | |
Increase (Decrease) | |
| |
In Millions USD | | |
% | |
Western Europe | |
$ | 66.9 | | |
$ | 71.0 | | |
$ | 4.1 | | |
| 6.1 | % |
The Americas | |
| 37.2 | | |
| 31.4 | | |
| (5.8 | ) | |
| (15.6 | )% |
Asia-Pacific | |
| 16.4 | | |
| 15.6 | | |
| (0.8 | ) | |
| (4.9 | )% |
Central & Eastern Europe, Middle East, Africa | |
| 6.0 | | |
| 6.4 | | |
| 0.4 | | |
| 6.7 | % |
Total | |
$ | 126.5 | | |
$ | 124.4 | | |
$ | (2.1 | ) | |
| (1.7 | )% |
Product Segment Revenue Breakdown | |
Three Months Ended | | |
| | |
| |
| |
December 31, 2014 | | |
December 31, 2015 | | |
(decrease) | | |
(decrease) | |
| |
In millions USD | | |
% | |
Sparkling Water Maker Starter Kits | |
$ | 53.1 | | |
$ | 41.5 | | |
$ | (11.6 | ) | |
| (22 | )% |
Consumables | |
| 72.5 | | |
| 70.5 | | |
| (2.0 | ) | |
| (3 | )% |
Other | |
| 0.9 | | |
| 0.9 | | |
| (0.0 | ) | |
| (1 | )% |
Total | |
$ | 126.5 | | |
$ | 112.9 | | |
$ | (13.6 | ) | |
| (11 | )% |
Product Segment Unit Breakdown | |
Three Months Ended | | |
| | |
| |
| |
December 31, 2014 | | |
December 31, 2015 | | |
Increase (decrease) | | |
Increase (decrease) | |
| |
In thousands | | |
% | |
Sparkling Water Maker Starter Kits | |
| 1,018 | | |
| 769 | | |
| (249 | ) | |
| (24 | )% |
CO2 Refills | |
| 6,289 | | |
| 6,749 | | |
| 460 | | |
| 7 | % |
Flavors | |
| 6,054 | | |
| 5,573 | | |
| (481 | ) | |
| (8 | )% |
The decrease in revenue compared to the
fourth quarter 2014 was mainly due to changes in foreign currency exchange rates, which reduced revenue by $11.5 million. Since
the same period a year ago, several foreign currencies have weakened compared to the U.S. dollar, including the Euro by 12%, the
Australian dollar by 16% and the Canadian dollar by 14%.
Gross margin (before the impact of restructuring
costs) was 48.0% compared to 50.4% for the same period in 2014. Fourth quarter 2015 gross margin was negatively impacted by changes
in foreign currency exchange rates compared to the same period last year, partially offset by higher share of CO2 refills
in the product mix.
Sales and marketing expenses were $35.0
million, or 31.0% of revenue, compared to $42.9 million, or 33.9% for the fourth quarter 2014. The decrease was primarily attributable
to lower advertising and promotion expenses, which decreased $5.5 million to 11.7% of revenue from 14.9% of revenue in the same
period in 2014, and lower distribution costs driven by lower sales volume. Sales and marketing expenses also decreased compared
to the same period last year due to changes in foreign currency rates, mainly the weakening of the Euro and the Australian dollar.
General and administrative expenses were
$12.4 million, or 11.0% of revenue, compared to $9.4 million, or 7.5% of revenue, in the fourth quarter 2014. The increase was
mainly due to $2.1 million of share-based payment expenses related to the stock options granted to our Chief Executive Officer
in December 2015 and a reversal of share-based payment expenses in the fourth quarter 2014.
Operating income (before the impact of
restructuring costs) was $6.2 million, or 5.4% of revenue, compared to $8.1 million, or 6.4% of revenue, in the fourth quarter
2014. The decrease in operating income was driven primarily by the negative impact on revenue from changes in foreign currency
exchange rates and the increase in share-based payments, partially offset by lower operating expenses, mainly due to a reduction
in sales and marketing expenses and a reduction in expenses deriving from impairment of intangible assets.
The net negative impact on Adjusted operating
income from changes in foreign currency exchange rates in comparison with the same period in 2014 was approximately $5.4 million.
Adjusted operating income on a constant currency basis and excluding share-based payments increased 176% to $14.2 million from
$5.1 million in the fourth quarter 2014.
Net financial expense was $0.3 million
compared to net financial income of $0.5 million in the same period in 2014. Financial expense in the fourth quarter 2015 was mainly
due to an increase in hedging expenses.
Tax expense was $0.8 million with an effective
tax rate of 14.5% on a Non-IFRS basis, excluding the impact of restructuring, compared to $1.2 million with an effective tax rate
of 13.8% in the fourth quarter 2014. The increase in the effective tax rate is due to the geographical allocation of profit before
income tax.
Balance Sheet Review
Cash and cash equivalents at December 31,
2015 were $34.5 million compared to $46.9 million at December 31, 2014. The decrease is mainly due to investments in the new plant
and repayment of bank debt, partially offset by cash generated from operations.
The company generated positive free cash
flow, defined as cash flow from operating activities less cash flow for investment activities, of $1.5 million compared to negative
free cash flow of $2.4 million in the fourth quarter 2014.
The company had $36.8 million of bank debt
at December 31, 2015 mainly for financing the investment in its new production facility, compared to $43.9 million of bank debt
at December 31, 2014.
Working capital at December 31, 2015 decreased
by 11.4% to $140.7 million compared to $158.8 million at December 31, 2014 largely due to rationalization of inventory and the
impact of the restructuring. Inventories at December 31, 2015 decreased by 18.4% to $113.0 million compared to $138.4 million at
December 31, 2014.
Conference Call and Management Commentary
Detailed CFO commentary and a supplemental
slide presentation have been furnished as Exhibits 99.2 and 99.3 to the Form 6-K furnished to the Securities and Exchange Commission
and will be posted on the company’s website, http://sodastream.investorroom.com.
The company has scheduled a conference
call for 8:30 a.m. Eastern Standard Time (U.S. time) today (Thursday, February 18, 2016) to review the company’s financial
results. The conference call will be broadcast over the Internet as a “live” listen only Webcast. To listen, please
go to: http://sodastream.investorroom.com. Listeners are urged to login approximately
20 minutes before the conference call is scheduled to begin in order to register, as well as download and install any necessary
audio software. An archive of the Webcast will be available for 30 days after the call.
About SodaStream International
SodaStream is the world's leading manufacturer
and distributor of Sparkling Water Makers, which enable consumers to easily transform ordinary tap water into sparkling water and
flavored sparkling water in seconds. By making ordinary water more exciting and fun to drink, SodaStream helps consumers drink
more water. Sparkling Water Makers offer a highly differentiated and innovative solution to consumers of bottled and canned carbonated
soft drinks. The products promote health and wellness, are environmentally friendly, cost effective, and are customizable and fun
to use. Products are available at more than 70,000 retail stores across 45 countries, including approximately 13,000 retail stores
in the United States. To learn more about how SodaStream makes water exciting and follow SodaStream on Facebook, Twitter, Pinterest,
Instagram and YouTube, visit http://www.sodastream.com.
Non-IFRS Financial Measures
This press release contains certain non-IFRS
measures, including Adjusted revenue, Adjusted operating income, Adjusted net income, Adjusted EBITDA, and Adjusted diluted earnings
per share (“Adjusted diluted EPS”).
Adjusted EBITDA represents earnings before
financial expense (income), income tax, depreciation and amortization, and further eliminates the effect of restructuring costs.
Adjusted revenue, Adjusted operating income, Adjusted net income and Adjusted diluted EPS eliminate the effect of restructuring
costs.
The company believes that the Adjusted
revenue, Adjusted operating income, Adjusted net income, Adjusted EBITDA and Adjusted diluted EPS, as described above, should be
considered in evaluating the company’s performance. Adjusted revenue, Adjusted operating income, Adjusted net income, Adjusted
EBITDA and Adjusted diluted EPS exclude restructuring costs because most of this charge is a non-cash expense that does not reflect
the performance of the company’s underlying business and operations. Adjusted EBITDA facilitates operating performance comparisons
from period to period and company to company by backing out potential differences caused by variations in capital structures (affecting
financial expenses (income), net), tax positions (such as the impact of changes in effective tax rates)
and the age and depreciation charges and amortization of fixed and intangible assets, respectively (affecting relative depreciation
and amortization expense, respectively).
These measures should be considered in
addition to results prepared in accordance with IFRS and should not be considered a substitute for the IFRS results. The non-IFRS
measures included in this press release have been reconciled to the IFRS results.
Forward Looking Statements
This press release contains forward-looking
statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of
1933, and Section 21E of the Securities Exchange Act of 1934. These forward-looking statements include information about possible
or assumed future results of our business and financial condition, as well as the results of operations, liquidity, plans and objectives.
In some cases, you can identify forward-looking statements by terminology such as “believe,” “may,” “estimate,”
“continue,” “anticipate,” “intend,” “should,” “plan,” “expect,”
“predict,” “potential,” or the negative of these terms or other similar expressions: Such statements are
based on management's current beliefs and expectations and involve a number of known and unknown risks and uncertainties that could
cause our future results, performance or achievements to differ significantly from the results, performance or achievements expressed
or implied by such forward-looking statements. Important factors that could cause or contribute to such differences include risks
relating to: our ability to maintain or expand sales in our target markets, including the United States; our ability to maintain
or continue to develop our presence in retail networks; our ability to develop and implement production and operating infrastructure
to effectively support our growth; the success of our marketing campaigns and media spending in terms of increased sales or increased
product and brand name awareness; our ability to maintain our customer base in markets where we have an established presence; the
risks associated with our reliance on exclusive arrangements for the distribution of our beverage carbonation systems and consumables
in each of the markets in which we use third-party distributors; our ability to compete effectively with other companies which
currently offer, or may offer in the future, competing products; our ability to maintain margins due to decline in product selling
price and/or rising costs; potential product liability claims if any component of our beverage carbonation systems is misused;
our ability to protect our intellectual property rights; our being found to have a dominant position in certain markets which may
place limits on our ability to operate; risks associated with our being a multinational corporation, including fluctuations in
currency exchange rates; our potential exposure to greater than anticipated tax liabilities; our products being subject to extensive
governmental regulation in the markets in which we operate; adverse conditions in the global economy which could negatively impact
our customers' demand for our products; and other factors discussed under the heading “Risk Factors” in the Annual
Report on the Form 20-F for the year ended December 31, 2014 and other documents filed with or furnished to the Securities
and Exchange Commission. These forward-looking statements are made only as of the date hereof, and the company undertakes
no obligation to update or revise the forward-looking statements, whether as a result of new information, future events or otherwise.
Investor Contact:
Brendon Frey
ICR
Phone: + 1 203-682-8200
brendon.frey@icrinc.com
Consolidated Statements of Operations
In thousands (other than per share amounts)
| |
For the year ended | | |
For the three months ended | |
| |
December 31, | | |
December 31, | |
| |
2014 | | |
2015 | | |
2014 | | |
2015 | |
| |
(Audited) | | |
(Unaudited) | | |
(Unaudited) | | |
(Unaudited) | |
Revenues | |
$ | 511,774 | | |
$ | 413,135 | | |
$ | 126,526 | | |
$ | 112,942 | |
Cost of revenues | |
| 258,686 | | |
| 216,364 | | |
| 71,018 | | |
| 60,909 | |
| |
| | | |
| | | |
| | | |
| | |
Gross profit | |
| 253,088 | | |
| 196,771 | | |
| 55,508 | | |
| 52,033 | |
| |
| | | |
| | | |
| | | |
| | |
Operating expenses | |
| | | |
| | | |
| | | |
| | |
| |
| | | |
| | | |
| | | |
| | |
Sales and marketing | |
| 177,668 | | |
| 138,641 | | |
| 42,945 | | |
| 35,031 | |
General and administrative | |
| 49,795 | | |
| 47,258 | | |
| 9,437 | | |
| 12,389 | |
Other expenses | |
| 10,654 | | |
| 631 | | |
| 10,654 | | |
| 631 | |
| |
| | | |
| | | |
| | | |
| | |
Total operating expenses | |
| 238,117 | | |
| 186,530 | | |
| 63,036 | | |
| 48,051 | |
| |
| | | |
| | | |
| | | |
| | |
Operating income (loss) | |
| 14,971 | | |
| 10,241 | | |
| (7,528 | ) | |
| 3,982 | |
| |
| | | |
| | | |
| | | |
| | |
Interest expense (income), net | |
| 401 | | |
| 350 | | |
| (151 | ) | |
| 286 | |
Other financial expenses (income), net | |
| (1,593 | ) | |
| (5,192 | ) | |
| (383 | ) | |
| 20 | |
| |
| | | |
| | | |
| | | |
| | |
Total financial expenses (income), net | |
| (1,192 | ) | |
| (4,842 | ) | |
| (534 | ) | |
| 306 | |
| |
| | | |
| | | |
| | | |
| | |
Income (loss) before income taxes | |
| 16,163 | | |
| 15,083 | | |
| (6,994 | ) | |
| 3,676 | |
| |
| | | |
| | | |
| | | |
| | |
Income tax expense | |
| 3,868 | | |
| 3,006 | | |
| 1,196 | | |
| 848 | |
| |
| | | |
| | | |
| | | |
| | |
Net income (loss) for the period | |
$ | 12,295 | | |
$ | 12,077 | | |
$ | (8,190 | ) | |
$ | 2,828 | |
| |
| | | |
| | | |
| | | |
| | |
Net income (loss) per share | |
| | | |
| | | |
| | | |
| | |
Basic | |
$ | 0.59 | | |
$ | 0.57 | | |
$ | (0.39 | ) | |
$ | 0.13 | |
Diluted | |
$ | 0.58 | | |
$ | 0.57 | | |
$ | (0.39 | ) | |
$ | 0.13 | |
| |
| | | |
| | | |
| | | |
| | |
Weighted average number of shares | |
| | | |
| | | |
| | | |
| | |
Basic | |
| 20,968 | | |
| 21,037 | | |
| 21,007 | | |
| 21,064 | |
Diluted | |
| 21,251 | | |
| 21,117 | | |
| 21,076 | | |
| 21,151 | |
Consolidated Balance Sheets as of | |
| | |
| |
| |
| | |
| |
| |
December 31, | | |
December 31, | |
| |
2014 | | |
2015 | |
| |
(Audited) | | |
(Unaudited) | |
| |
(In thousands) | |
Assets | |
| | | |
| | |
Cash and cash equivalents | |
$ | 46,880 | | |
$ | 34,534 | |
Inventories | |
| 138,392 | | |
| 112,973 | |
Trade receivables | |
| 94,217 | | |
| 76,566 | |
Other receivables | |
| 34,789 | | |
| 29,099 | |
Derivative financial instruments | |
| 1,035 | | |
| 631 | |
Total current assets | |
| 315,313 | | |
| 253,803 | |
| |
| | | |
| | |
Property, plant and equipment | |
| 124,817 | | |
| 155,294 | |
Intangible assets | |
| 44,389 | | |
| 42,095 | |
Deferred tax assets | |
| 2,506 | | |
| 1,106 | |
Other receivables | |
| 273 | | |
| 431 | |
Total non-current assets | |
| 171,985 | | |
| 198,926 | |
| |
| | | |
| | |
Total assets | |
| 487,298 | | |
| 452,729 | |
| |
| | | |
| | |
Liabilities | |
| | | |
| | |
Loans and borrowings | |
| 9,239 | | |
| 11,917 | |
Derivative financial instruments | |
| 491 | | |
| - | |
Trade payables | |
| 79,966 | | |
| 50,549 | |
Income tax payable | |
| 11,740 | | |
| 7,505 | |
Provisions | |
| 2,469 | | |
| 2,407 | |
Other current liabilities | |
| 14,927 | | |
| 18,118 | |
Total current liabilities | |
| 118,832 | | |
| 90,496 | |
| |
| | | |
| | |
Loans and borrowings | |
| 34,645 | | |
| 24,905 | |
Employee benefits | |
| 2,174 | | |
| 2,152 | |
Other non-current liabilities | |
| 122 | | |
| 156 | |
Deferred tax liabilities | |
| 750 | | |
| 832 | |
Total non-current liabilities | |
| 37,691 | | |
| 28,045 | |
| |
| | | |
| | |
Total liabilities | |
| 156,523 | | |
| 118,541 | |
| |
| | | |
| | |
Shareholders’ equity | |
| | | |
| | |
Share capital | |
| 3,400 | | |
| 3,414 | |
Share premium | |
| 198,918 | | |
| 205,527 | |
Translation reserve | |
| (14,908 | ) | |
| (29,993 | ) |
Retained earnings | |
| 143,365 | | |
| 155,240 | |
Total shareholders’ equity | |
| 330,775 | | |
| 334,188 | |
| |
| | | |
| | |
Total liabilities and shareholders’ equity | |
$ | 487,298 | | |
$ | 452,729 | |
Consolidated Statements of Cash Flows | |
| | |
| | |
| | |
| |
| |
For the year ended | | |
For the three months ended | |
| |
December 31, | | |
December 31, | |
| |
2014 | | |
2015 | | |
2014 | | |
2015 | |
| |
(Audited) | | |
(Unaudited) | | |
(Unaudited) | | |
(Unaudited) | |
Cash flows from operating activities | |
| | | |
| | | |
| | | |
| | |
Net income (loss) for the period | |
$ | 12,295 | | |
$ | 12,077 | | |
$ | (8,190 | ) | |
$ | 2,828 | |
| |
| | | |
| | | |
| | | |
| | |
Adjustments: | |
| | | |
| | | |
| | | |
| | |
Amortization of intangible assets | |
| 2,948 | | |
| 3,710 | | |
| 906 | | |
| 945 | |
Change in fair value of derivative financial instruments | |
| (906 | ) | |
| (2,678 | ) | |
| 418 | | |
| 362 | |
Exchange rate differences on short-term loans and borrowing | |
| - | | |
| (1,386 | ) | |
| - | | |
| - | |
Exchange rate differences on long-term loans and borrowing | |
| (2,986 | ) | |
| (3,675 | ) | |
| (1,956 | ) | |
| (805 | ) |
Depreciation of property, plant and equipment | |
| 14,099 | | |
| 13,233 | | |
| 4,014 | | |
| 3,411 | |
Restructuring costs | |
| 15,649 | | |
| 6,930 | | |
| 15,649 | | |
| 394 | |
Impairment of goodwill and other intangible assets | |
| 3,312 | | |
| 631 | | |
| 3,312 | | |
| 631 | |
Share-based payments | |
| 3,760 | | |
| 6,471 | | |
| (2,972 | ) | |
| 2,706 | |
Interest expense (income), net | |
| 401 | | |
| 350 | | |
| (151 | ) | |
| 286 | |
Income tax expense | |
| 3,868 | | |
| 3,006 | | |
| 1,196 | | |
| 848 | |
| |
| 52,440 | | |
| 38,669 | | |
| 12,226 | | |
| 11,606 | |
Decrease (increase) in inventories | |
| (12,658 | ) | |
| 19,860 | | |
| 2,946 | | |
| 9,743 | |
Decrease (increase) trade and other receivables | |
| 21,471 | | |
| 12,211 | | |
| (1,954 | ) | |
| (5,162 | ) |
Decrease in trade payables and other liabilities | |
| (22,054 | ) | |
| (24,680 | ) | |
| (4,106 | ) | |
| (3,637 | ) |
Increase (decrease) in employee benefits | |
| 49 | | |
| (89 | ) | |
| 119 | | |
| (48 | ) |
Increase (decrease) in provisions | |
| 855 | | |
| (62 | ) | |
| 462 | | |
| (215 | ) |
| |
| 40,103 | | |
| 45,909 | | |
| 9,693 | | |
| 12,287 | |
Interest paid | |
| (438 | ) | |
| (479 | ) | |
| (145 | ) | |
| (297 | ) |
Income tax received | |
| 956 | | |
| 565 | | |
| 241 | | |
| 16 | |
Income tax paid | |
| (5,036 | ) | |
| (5,987 | ) | |
| (675 | ) | |
| (479 | ) |
Net cash from operating activities | |
| 35,585 | | |
| 40,008 | | |
| 9,114 | | |
| 11,527 | |
| |
| | | |
| | | |
| | | |
| | |
Cash flows from investing activities | |
| | | |
| | | |
| | | |
| | |
Interest received | |
| 87 | | |
| 129 | | |
| 45 | | |
| 11 | |
Proceeds from investment grants | |
| - | | |
| 2,252 | | |
| - | | |
| - | |
Proceeds from derivative financial instruments, net | |
| 797 | | |
| 2,591 | | |
| 1,324 | | |
| 20 | |
Acquisition of property, plant and equipment | |
| (55,174 | ) | |
| (49,466 | ) | |
| (11,208 | ) | |
| (8,673 | ) |
Acquisition of intangible assets | |
| (5,684 | ) | |
| (4,236 | ) | |
| (1,630 | ) | |
| (1,411 | ) |
Net cash used in investing activities | |
| (59,974 | ) | |
| (48,730 | ) | |
| (11,469 | ) | |
| (10,053 | ) |
| |
| | | |
| | | |
| | | |
| | |
Cash flows from financing activities | |
| | | |
| | | |
| | | |
| | |
Proceeds from exercise of employee share options | |
| 860 | | |
| 153 | | |
| 40 | | |
| - | |
Receipts of long-term loans and borrowings | |
| 49,253 | | |
| 10,000 | | |
| 19,043 | | |
| 10,000 | |
Repayments of long-term loans and borrowings | |
| (2,383 | ) | |
| (16,248 | ) | |
| (2,383 | ) | |
| (2,222 | ) |
Change in short-term debt | |
| (15,452 | ) | |
| 4,247 | | |
| (6,622 | ) | |
| (17,766 | ) |
Net cash from (used in) financing activities | |
| 32,278 | | |
| (1,848 | ) | |
| 10,078 | | |
| (9,988 | ) |
| |
| | | |
| | | |
| | | |
| | |
Net increase (decrease) in cash and cash equivalents | |
| 7,889 | | |
| (10,570 | ) | |
| 7,723 | | |
| (8,514 | ) |
Cash and cash equivalents at the beginning of the period | |
| 40,885 | | |
| 46,880 | | |
| 39,901 | | |
| 43,480 | |
Effect of exchange rates fluctuations on cash and cash equivalents | |
| (1,894 | ) | |
| (1,776 | ) | |
| (744 | ) | |
| (432 | ) |
| |
| | | |
| | | |
| | | |
| | |
Cash and cash equivalents at the end of the period | |
$ | 46,880 | | |
$ | 34,534 | | |
$ | 46,880 | | |
$ | 34,534 | |
Information about Adjusted revenue in reportable segments | |
| | |
| |
| |
| | |
| | |
| | |
| | |
| |
| |
Western Europe | | |
The Americas | | |
Asia-Pacific | | |
Central & Eastern Europe, Middle East, Africa | | |
Total | |
| |
(In thousands) | |
Year ended: | |
| | |
| | |
| | |
| | |
| |
December 31, 2014 (Audited) | |
$ | 281,690 | | |
| 142,301 | | |
| 53,837 | | |
| 33,946 | | |
$ | 511,774 | |
December 31, 2015 (Unaudited) | |
| 251,496 | | |
| 102,104 | | |
| 40,711 | | |
| 21,644 | | |
$ | 415,955 | |
| |
| | | |
| | | |
| | | |
| | | |
| | |
Three months ended: | |
| | | |
| | | |
| | | |
| | | |
| | |
December 31, 2014 (Unaudited) | |
$ | 66,885 | | |
| 37,160 | | |
| 16,441 | | |
| 6,040 | | |
$ | 126,526 | |
December 31, 2015 (Unaudited) | |
$ | 63,258 | | |
| 30,006 | | |
| 13,671 | | |
| 6,007 | | |
$ | 112,942 | |
The following tables present the company’s Adjusted
revenue, by product type for the periods presented, as well as such revenue by product type as a percentage of total Adjusted revenue:
| |
Year ended | | |
Three months ended | |
| |
December 31, | | |
December 31, | |
| |
2014 | | |
2015 | | |
2014 | | |
2015 | |
| |
(Audited) (Unaudited) | | |
(Unaudited) | |
| |
Revenue | |
| |
(in thousands) | |
| |
| | |
| | |
| | |
| |
Sparkling Water Maker starter kits (including exchange cylinders) | |
$ | 172,614 | | |
$ | 133,033 | | |
$ | 53,080 | | |
$ | 41,534 | |
Consumables | |
| 327,400 | | |
| 275,645 | | |
| 72,565 | | |
| 70,512 | |
Other | |
| 11,760 | | |
| 7,277 | | |
| 881 | | |
| 896 | |
Total | |
$ | 511,774 | | |
$ | 415,955 | | |
$ | 126,526 | | |
$ | 112,942 | |
| |
Year ended | | |
Three months ended | |
| |
December 31, | | |
December 31, | |
| |
2014 | | |
2015 | | |
2014 | | |
2015 | |
| |
(Audited) | | |
(Unaudited) | | |
(Unaudited) | |
| |
As a percentage of revenue | |
| |
| | |
| | |
| | |
| |
Sparkling Water Maker starter kits (including exchange cylinders) | |
| 33.7 | % | |
| 32.0 | % | |
| 42.0 | % | |
| 36.8 | % |
Consumables | |
| 64.0 | % | |
| 66.3 | % | |
| 57.4 | % | |
| 62.4 | % |
Other | |
| 2.3 | % | |
| 1.7 | % | |
| 0.6 | % | |
| 0.8 | % |
Total | |
| 100.0 | % | |
| 100.0 | % | |
| 100.0 | % | |
| 100.0 | % |
The following table provides a reconciliation of Non-IFRS
to IFRS financial data for the three months ended December 31, 2015:
| |
Non-IFRS | | |
Restructuring | | |
IFRS | |
| |
In Thousands USD | |
Revenue | |
$ | 112,942 | | |
$ | | | |
$ | 112,942 | |
Cost of revenue | |
| 58,738 | | |
| (2,171 | ) | |
| 60,909 | |
Gross profit | |
| 54,204 | | |
| 2,171 | | |
| 52,033 | |
Operating income | |
| 6,153 | | |
| 2,171 | | |
| 3,982 | |
Net income for the period | |
$ | 4,999 | | |
$ | 2,171 | | |
$ | 2,828 | |
Net income per share | |
| | | |
| | | |
| | |
Basic and diluted (in USD) | |
| 0.24 | | |
| 0.11 | | |
| 0.13 | |
The following table provides
a reconciliation of Non-IFRS to IFRS financial data for the year ended December 31, 2015:
| |
Non-IFRS | | |
Restructuring | | |
IFRS | |
| |
In Thousands USD | |
Revenue | |
$ | 415,955 | | |
$ | 2,820 | | |
$ | 413,135 | |
Cost of revenue | |
| 209,666 | | |
| (6,698 | ) | |
| 216,364 | |
Gross profit | |
| 206,289 | | |
| 9,518 | | |
| 196,771 | |
Operating income | |
| 19,759 | | |
| 9,518 | | |
| 10,241 | |
Net income for the period | |
$ | 21,595 | | |
$ | 9,518 | | |
$ | 12,077 | |
Net income per share diluted (in USD) | |
| 1.02 | | |
| 0.45 | | |
| 0.57 | |
EBITDA | |
| | |
| | |
| | |
| |
| |
Year ended | | |
Three months ended | |
| |
December 31, | | |
December 31, | |
| |
2014 | | |
2015 | | |
2014 | | |
2015 | |
| |
(Unaudited) | |
| |
(In thousands) | |
| |
| | |
| | |
| | |
| |
Reconciliation of Net Income to EBITDA | |
| | | |
| | | |
| | | |
| | |
Net income | |
$ | 12,295 | | |
$ | 12,077 | | |
$ | (8,190 | ) | |
$ | 2,828 | |
Financial expense (income), net (*) | |
| (1,192 | ) | |
| (4,842 | ) | |
| (534 | ) | |
| 306 | |
Income tax expense | |
| 3,868 | | |
| 3,006 | | |
| 1,196 | | |
| 848 | |
Depreciation and amortization | |
| 17,047 | | |
| 16,943 | | |
| 4,920 | | |
| 4,356 | |
EBITDA | |
$ | 32,018 | | |
$ | 27,184 | | |
$ | (2,608 | ) | |
$ | 8,338 | |
Restructuring | |
| 15,649 | | |
| 9,518 | | |
| 15,649 | | |
| 2,171 | |
Impairment of goodwill | |
| 3,312 | | |
| - | | |
| 3,312 | | |
| - | |
Adjusted EBITDA | |
| 50,979 | | |
| 36,702 | | |
| 16,353 | | |
| 10,509 | |
| (*) | Starting in Q1 2015, the company presents EBITDA excluding
total financial expense (income), net, as compared to 2014, in which EBITDA was presented excluding only interest expense. The
three months ended December 31, 2014 and the year ended December 31, 2014 EBITDA were also Adjusted to exclude the total financial
expense. |
Exhibit 99.2
SodaStream International Ltd.
Chief Financial Officer’s Commentary
Fourth Quarter 2015
Restructuring
During the fourth quarter of 2015, the
Company recorded pre-tax charges of $2.2 million in cost of revenues as part of the restructuring and growth plan it announced
on October 29, 2014. These charges represent the final restructuring costs incurred in connection with this plan and were related
primarily to activities associated with the transition to the new Lehavim plant in southern Israel.
The following table provides a reconciliation
of Non-IFRS to IFRS financial data for the three months ended December 31, 2015:
| |
Non-IFRS | | |
Restructuring | | |
IFRS | |
| |
In Thousands USD | |
Revenue | |
$ | 112,942 | | |
$ | | | |
$ | 112,942 | |
Cost of revenue | |
| 58,738 | | |
| (2,171 | ) | |
| 60,909 | |
Gross profit | |
| 54,204 | | |
| 2,171 | | |
| 52,033 | |
Operating income | |
| 6,153 | | |
| 2,171 | | |
| 3,982 | |
Net income for the period | |
$ | 4,999 | | |
$ | 2,171 | | |
$ | 2,828 | |
Net income per share basic and diluted (in USD) | |
| 0.24 | | |
| 0.11 | | |
| 0.13 | |
Revenue
Fourth quarter revenue decreased
10.7% to $112.9 million from $126.5 million in the fourth quarter 2014. Changes in foreign currency exchange rates negatively
impacted revenue by approximately $11.5 million, primarily reflecting the weakening of the Euro/U.S. dollar exchange rate by
12%, the Australian dollar/U.S. dollar by 16% and the Canadian dollar/U.S. dollar by 14% versus the same period in the prior
year.
Geographical Revenue Breakdown Revenue | |
Three Months Ended | | |
| | |
| |
| |
December 31, 2014 | | |
December 31, 2015 | | |
(Decrease) | | |
(Decrease) | |
| |
In Millions USD | | |
% | |
Western Europe | |
$ | 66.9 | | |
$ | 63.2 | | |
$ | (3.7 | ) | |
| (5.4 | )% |
The Americas | |
| 37.2 | | |
| 30.0 | | |
| (7.2 | ) | |
| (19.3 | )% |
Asia-Pacific | |
| 16.4 | | |
| 13.7 | | |
| (2.7 | ) | |
| (16.8 | )% |
Central & Eastern Europe, Middle East, Africa | |
| 6.0 | | |
| 6.0 | | |
| (0.0 | ) | |
| (0.5 | )% |
Total | |
$ | 126.5 | | |
$ | 112.9 | | |
$ | (13.6 | ) | |
| (10.7 | )% |
On a constant currency basis the revenue
comparison is as follows:
Geographical Revenue Breakdown – constant currency basis Revenue | |
Three Months Ended | | |
| | |
| |
| |
December 31, 2014 | | |
December 31, 2015 - at Q4-2014 average rates | | |
Increase (Decrease) | | |
Increase (Decrease) | |
| |
In Millions USD | | |
% | |
Western Europe | |
$ | 66.9 | | |
$ | 71.0 | | |
$ | 4.1 | | |
| 6.1 | % |
The Americas | |
| 37.2 | | |
| 31.4 | | |
| (5.8 | ) | |
| (15.6 | )% |
Asia-Pacific | |
| 16.4 | | |
| 15.6 | | |
| (0.8 | ) | |
| (4.9 | )% |
Central & Eastern Europe, Middle East, Africa | |
| 6.0 | | |
| 6.4 | | |
| 0.4 | | |
| 6.7 | % |
Total | |
$ | 126.5 | | |
$ | 124.4 | | |
$ | (2.1 | ) | |
| (1.7 | )% |
The following table sets forth each region’s
contribution to total revenue and a comparison with the fourth quarter 2014 (by percentage):
Region | |
Portion of the revenue in three months ended | |
| |
December 31, 2014 | | |
December 31, 2015 | |
Western Europe | |
| 52.8 | % | |
| 56.0 | % |
The Americas | |
| 29.4 | % | |
| 26.6 | % |
Asia-Pacific | |
| 13.0 | % | |
| 12.1 | % |
Central & Eastern Europe, Middle East & Africa | |
| 4.8 | % | |
| 5.3 | % |
Total | |
| 100.0 | % | |
| 100.0 | % |
The revenue decrease in the Americas was
mainly due to lower demand for sparkling water makers and flavor units in the U.S. The decrease in Western Europe revenue was mainly
due to changes in foreign currency exchange rates. Excluding the foreign currency exchange impact, Western Europe revenue increased
by approximately 6.1% due to increased sales in Germany, Austria, and Switzerland, partially offset by declines in France and the
Nordics. Asia-Pacific revenue decreased primarily due to changes in foreign currency exchange rates combined with lower sparkling
water makers and flavor unit sales in Australia, partially offset by increased sales in Japan. CEMEA revenue remained flat with
increased sales in Israel partially offset by changes in foreign currency exchange rates.
Sparkling water maker unit sales decreased
24% to 769,000 from 1,018,000 in the same period in 2014 mainly due to decreases in the U.S., France and Australia, partially offset
by increases in Germany, Austria, Japan and Italy. CO2 refill unit sales increased 7% to 6.7 million and flavor unit
sales decreased 8% to 5.6 million.
Gross Margin
Gross margin (before the impact of restructuring
costs) was 48.0% compared to 50.4% for the same period in 2014. Fourth quarter 2015 gross margin was negatively impacted by changes
in foreign currency exchange rates compared to the same period in the prior year, partially offset by higher share of CO2
refills in the product mix.
Sales and Marketing
Sales and marketing expenses were $35.0
million, or 31.0% of revenue, compared to $42.9 million, or 33.9% of revenue in the same period in 2014. The decrease was attributable
to lower advertising and promotion expenses and lower distribution expenses. Sales and marketing expenses also decreased in comparison
to the same period in the prior year due to changes in foreign currency rates, mainly the weakening of the Euro and the Australian
dollar versus the U.S. dollar.
Sales organization, logistics and distribution
expenses decreased $2.4 million to $21.7 million, or 19.3% of revenue, compared to $24.1 million, or 19.1% of revenue, in the fourth
quarter 2014, mainly due to lower sparkling water maker sales volume. Advertising and promotion expenses decreased $5.5 million
to $13.3 million, or 11.7% of revenue, in the quarter, compared to $18.8 million, or 14.9% of revenue, in the fourth quarter 2014.
General and Administrative
General and administrative expenses were $12.4 million, or 11.0%
of revenue, compared to $9.4 million, or 7.5% of revenue in the same period of in the prior year. The increase was mainly due to
$2.1 million of share-based payment expenses related to the stock options granted to our Chief Executive Officer in December 2015
and a reversal of share-based payment expenses in the fourth quarter 2014.
Operating Income
Operating income (before the impact of
restructuring) was $6.2 million, or 5.4% of revenue, compared to $8.1 million, or 6.4% of revenue, in the fourth quarter 2014.
The decrease in operating income was driven mainly by negative impact on revenue from the changes in foreign currency exchange
rates and the increase in share-based payments, partially offset by a reduction in sales and marketing expenses and a reduction
in expenses deriving from impairment of intangible assets. Adjusted operating income on a constant currency basis was $11.5 million,
or 9.3% of revenue, reflecting an increase of 41.9% compared to the same period last year. Adjusted operating income on a constant
currency basis and excluding share-based payments was $14.2 million, 176% increase compared to an Adjusted operating income excluding
share-based payments of $5.1 million in the fourth quarter of 2014.
Tax Expense
Tax expense was $0.8 million, or an effective
tax rate of 14.5%, compared to $1.2 million, or an effective tax rate of 13.8% in the fourth quarter 2014 on a Non-IFRS basis,
excluding the impact of restructuring. The increase in the effective tax rate is due to the geographical allocation of profit before
income tax.
IFRS Net Income
Net income on IFRS basis was $2.8 million,
or $0.13 per diluted share, based on 21.2 million weighted shares outstanding compared to a net loss on IFRS basis of $8.2 million,
or loss of $0.39 per diluted share, based on 21.1 million weighted shares outstanding in the fourth quarter 2014.
Adjusted Net Income
Adjusted net income was $5.0 million, or
$0.24 per diluted share, compared to net income on Adjusted basis of $7.5 million, or $0.35 per diluted share, in the fourth quarter
2014.
Foreign Currency Impact
Changes in foreign currency exchange rates
("FX") had a negative impact of approximately $11.5 million on revenue mainly due to a weakening of the Euro, the Australian
dollar and the Canadian dollar exchange rate against the U.S. dollar compared to their average rates in the fourth quarter 2014.
Conversely, FX had a positive impact on cost of revenue and operating expenses during the fourth quarter 2015, because approximately
72% of costs and expenses in the fourth quarter were denominated in currencies other than the U.S. dollar (mainly the Euro and
the Israeli Shekel) whose values decreased by 12% and 1% respectively against the U.S. dollar compared to their average rate in
the same period 2014. As a result, FX had an overall net negative impact of approximately $5.4 million on operating income.
Balance Sheet
Cash and cash equivalents at December 31,
2015 were $34.5 million compared to $46.9 million at December 31, 2014. The decrease is mainly attributable to repayment of short
term debt, partially offset by cash generated from operations.
The company generated positive free cash
flow, defined as cash flow from operating activities less cash flow for investment activity, of $1.5 million compared to negative
free cash flow of $2.4 million in the fourth quarter 2014.
The company had $36.8 million of bank debt
at December 31, 2015 mainly for financing the investment in its new production facility, compared to $43.9 million of bank debt
at December 31, 2014.
Working capital at December 31, 2015 decreased by 11.4% to $140.7
million compared to $158.8 million at December 31, 2014 mainly due to rationalization of inventory and the impact of the restructuring.
Inventories at December 31, 2015 decreased by 18.4% to $113.0 million compared to $138.4 million at December 31, 2014.
Full year 2015
Restructuring
During 2015, the Company recorded pre-tax
charges of $9.5 million, which decreased revenue by $2.8 million and increased cost of revenue by $6.7 million. These charges represent
the final restructuring costs incurred in connection with the growth plan of October 29, 2014.
The following table provides a reconciliation
of Non-IFRS to IFRS financial data for the year ended December 31, 2015:
| |
Non-IFRS | | |
Restructuring | | |
IFRS | |
| |
In Thousands USD | |
Revenue | |
$ | 415,955 | | |
$ | 2,820 | | |
$ | 413,135 | |
Cost of revenue | |
| 209,666 | | |
| (6,698 | ) | |
| 216,364 | |
Gross profit | |
| 206,289 | | |
| 9,518 | | |
| 196,771 | |
Operating income | |
| 19,759 | | |
| 9,518 | | |
| 10,241 | |
Net income for the period | |
$ | 21,595 | | |
$ | 9,518 | | |
$ | 12,077 | |
Net income per share diluted (in USD) | |
| 1.02 | | |
| 0.45 | | |
| 0.57 | |
Revenue
Revenue before the impact of the restructuring
decreased 18.7% to $416.0 million from $511.8 million in 2014. Changes in foreign currency exchange rates negatively impacted revenue
by $58.6 million, primarily as a result of the weakening of the Euro/U.S. dollar exchange rate by 17%, the Australian dollar/U.S.
dollar by 17% and the Swedish Krona/U.S. dollar by 19% versus the same period in the prior year.
Geographical Revenue Breakdown Adjusted Revenue | |
Year Ended | | |
| | |
| |
| |
December 31, 2014 | | |
December 31, 2015 | | |
(Decrease) | | |
(Decrease) | |
| |
In Millions USD | | |
% | |
Western Europe | |
$ | 281.7 | | |
$ | 251.5 | | |
$ | (30.2 | ) | |
| (10.7 | %) |
The Americas | |
| 142.3 | | |
| 102.1 | | |
| (40.2 | ) | |
| (28.2 | %) |
Asia-Pacific | |
| 53.8 | | |
| 40.7 | | |
| (13.1 | ) | |
| (24.4 | %) |
Central & Eastern Europe, Middle East, Africa | |
| 34.0 | | |
| 21.7 | | |
| (12.3 | ) | |
| (36.2 | %) |
Total | |
$ | 511.8 | | |
$ | 416.0 | | |
$ | (95.8 | ) | |
| (18.7 | %) |
On a constant currency basis, the Adjusted
revenue comparison is as follows:
Geographical Revenue Breakdown - constant currency basis Adjusted Revenue | |
Year Ended | | |
| | |
| |
| |
December 31, 2014 | | |
December 31, 2015* | | |
Increase (Decrease) | | |
Increase (Decrease) | |
| |
In Millions USD | | |
% | |
Western Europe | |
$ | 281.7 | | |
$ | 298.0 | | |
$ | 16.3 | | |
| 5.8 | % |
The Americas | |
| 142.3 | | |
| 104.8 | | |
| (37.5 | ) | |
| (26.3 | %) |
Asia-Pacific | |
| 53.8 | | |
| 47.3 | | |
| (6.5 | ) | |
| (12.2 | %) |
Central & Eastern Europe, Middle East, Africa | |
| 34.0 | | |
| 24.5 | | |
| (9.5 | ) | |
| (27.8 | %) |
Total | |
$ | 511.8 | | |
$ | 474.6 | | |
$ | (37.2 | ) | |
| (7.3 | %) |
* At 2014 average rates
The following table sets forth each region’s
contribution to total Adjusted revenue and a comparison with 2014
(by percentage):
Region | |
Portion of the Adjusted revenue in year ended | |
| |
December 31, 2014 | | |
December 31, 2015 | |
Western Europe | |
| 55.0 | % | |
| 60.5 | % |
The Americas | |
| 27.8 | % | |
| 24.5 | % |
Asia-Pacific | |
| 10.5 | % | |
| 9.8 | % |
Central & Eastern Europe, Middle East & Africa | |
| 6.7 | % | |
| 5.2 | % |
Total | |
| 100.0 | % | |
| 100.0 | % |
The revenue decrease in the Americas was
mainly due to lower demand for sparkling water makers and flavors in the U.S., which was partially due to the product transition
as part of the Company’s repositioning and growth plan. The decrease in revenue in Western Europe was mainly due to the impact
of changes in foreign currency exchange rates. Excluding the impact of foreign currency exchange rates, Western Europe revenue
increased approximately 5.8% due to increased sales in Germany, Austria and Switzerland partially offset by declines in France
and the Nordics. Asia-Pacific revenue decrease was primarily driven by changes in foreign currency exchange rates and decrease
in sparkling water makers and flavor unit sales in Australia and South Korea partially offset by increased sales in Japan. The
decrease in CEMEA revenue was mainly due to lower sales in Czech Republic.
Sparkling water maker unit sales decreased
25% to 2.4 million from 3.2 million in 2014 mainly due to the decrease in the U.S and France partially offset by the increase in
Germany, Austria and Switzerland. CO2 refill unit sales increased 7% to a record 26.8 million compared to 25.0 million
in 2014 and flavor unit sales decreased 29% to 22.3 million compared to 31.4 million in 2014 mainly due to the product line transition.
Gross Margin
Gross margin (before the impact of restructuring) was 49.6%
in 2015 compared to 51.1% in 2014. 2015 gross margin reduced mainly due to the impact of unfavorable changes in foreign currency
exchange rates on revenue, partially offset by higher share of CO2 refills in product mix.
Sales & Marketing
Sales and marketing expenses decreased
22.0% to $138.6 million, or 33.3% of Adjusted revenue, compared to $177.7 million, or 34.7% of revenue in 2014. Sales organization,
logistics and distribution expenses were $83.5 million or 20.1% of Adjusted revenue, compared to $100.8 million or 19.7% of revenue
in 2014. Advertising and promotion expenses were $55.1 million or 13.3% of Adjusted revenue compared to $76.9 million or 15.0%
of revenue in 2014.
General & Administrative
General and administrative expenses for
were $47.3 million, or 11.4% of Adjusted revenue, compared to $49.8 million, or 9.7% of revenue in 2014. The decrease was mainly
due to administrative cost reduction, partially offset by an increase in the share-based payment expenses.
Operating Income
Operating income (before the impact of
restructuring) decreased to $19.8 million, or 4.8% of Adjusted revenue compared to $30.6 million or 6.0% of revenue in 2014. Operating
income was negatively impacted from changes in foreign currency exchange rates by approximately $14.1 million.
Tax Expense
Tax expense was $3.0 million representing an effective tax rate
of 19.9% compared to $3.9 million or an effective tax rate of 23.9% in 2014. On a Non-IFRS basis, excluding the impact on the restructuring
charges, the effective tax rate was 12.2%, similar to 2014.
IFRS Net Income
2015 net income on an IFRS basis was $12.1
million, or $0.57 per diluted share, based on 21.1 million weighted shares outstanding, compared to net income of $12.3 million,
or $0.58 per diluted share, based on 21.3 million weighted shares outstanding in 2014.
Adjusted Net Income
2015 Adjusted net income was $21.6 million,
or $1.02 per diluted share compared to net income on Adjusted basis of $27.9 million, or $1.31 per diluted share, in 2014.
Foreign Currency Impact
Changes in FX had a negative impact on
Adjusted revenue of $58.6 million mainly due to the weakening in the Euro, the Australian dollar and the Swedish Krona average
exchange rates against the U.S. dollar compared to the 2014. Conversely, FX had a positive impact on cost of revenue and operating
expenses during 2015, because approximately 79% of costs and expenses were denominated in currencies other than the U.S. dollar
(mainly the Israeli Shekel), whose value decreased 8% against the U.S. dollar compared to their average rates in 2014. As a result,
FX had an overall net negative impact of approximately $14.1 million on operating income.
Exhibit 99.3
Q4 2015 % Change Y/Y Q4 2015 at Q4 - 2014 average exchange rates % Change Y/Y currency neutral Total Revenues $112.9 million - 11% $124.4 million - 2% Sparkling Water Maker Units 769,000 - 24% Flavor Units 5.6 million - 8% CO 2 Refill Units 6.7 million +7% Operating Income Non - IFRS (1) $6.2 million - 24% $11.5 million +42% Operating Income exc. Share Based Compensation Non - IFRS (1 $8.9 million +72% $14.2 million +176% Net Income Non - IFRS (1) $5.0 million - 33% Net Income exc. Share Based Compensation Non - IFRS (1 $7.7 million +72% EPS (2) Non - IFRS (1) $0.24 - 31% Net Income IFRS $2.8 million NA EPS (2) IFRS $0.13 NA Financial Highlights Q4 2015 (1 ) Excluding impact of restructuring. For reconciliations of the non - IFRS measures to the IFRS results, see the company’s press release “SodaStream reports fourth quarter fiscal 2015 results” ( 2) Based on 21.2 million weighted shares outstanding in Q4 2015 and 21.1 million weighted shares outstanding in Q4 2014
Q4 and FY - 2012 Presentation 2 Revenue 2014 – 2015 $ 118 $141 $126 $127 $91 $105 $102 $119 $ 110 $126 $113 $124 Q1 2014 Q2 2014 Q3 2014 Q4 2014 Q1 2015 Q1 2015 Currency Neutral* Q2 2015 Q2 2015 Currency Neutral* Q3 2015 Q3 2015 Currency Neutral* Q4 2015 Q4 2015 Currency Neutral* ($m) - 11% - 2% 0% - 16 % % change vs. 2014 qtr. currency neutral * Excluding restructuring cost and Currency Neutral: 2015 at 2014 exchange rates
Q4 and FY - 2012 Presentation 3 Operating Income 2014 – 2015 $2.3 $11.2 $8.9 $8.1 $ 3.7 $6.3 $4.5 $9.0 $5.4 $10.5 $6.2 $11.5 Q1 2014 Q2 2014 Q3 2014 Q4 2014 Q1 2015 Q1 2015 Currency Neutral* Q2 2015 Q2 2015 Currency Neutral* Q3 2015 Q3 2015 Currency Neutral* Q4 2015 Q4 2015 Currency Neutral* ($m) +174% +42% +18% - 20% % change vs. 2014 qtr. currency neutr al *Excluding restructuring cost and Currency Neutral: 2015 at 2014 exchange rates
2015 % Change Y/Y 2015 at 2014 average exchange rates % Change Y/Y currency neutral Total Revenues $416.0 million - 19% $474.6 million - 7% Sparkling Water Maker Units 2,4 million - 25% Flavor Units 22.3 million - 29% CO 2 Refill Units 26.8 million +7% Operating Income Non - IFRS ( 1 ) $19.8 million - 35% $33.8 million +10% Operating Income exc. Share Based Compensation Non - IFRS (1) $26.2 million - 24% $40.3 million +17% Net Income Non - IFRS (1) $21.6 million - 23% Net Income exc. Share Based Compensation Non - IFRS (1 $28.1 million - 11% EPS (2) Non - IFRS (1) $1.02 - 22% Net Income IFRS $12.1 million - 2% EPS (2) IFRS $0.57 - 2% Financial Highlights Full - Year 2015 ( 1 ) Excluding impact of restructuring. For reconciliations of the non - IFRS measures to the IFRS results, see the company’s press release “SodaStream reports fourth quarter fiscal 2015 results” ( 2 ) Based on 21.1 million weighted shares outstanding in 2015 and 21.3 million weighted shares outstanding in 2014 4
Q 4 and FY - 2012 Presentation 5 Revenue 2010 – 2015 $208.4 $289.0 $436.3 $562.7 $511.8 $ 416.0 $ 474.6 2010 2011 2012 2013 2014 2015 2015 Currency Neutral* ($m) * Excluding restructuring cost and Currency Neutral: 2015 at 2014 exchange rates - 19% - 7%
Q4 and FY - 2012 Presentation 6 Operating Income 2010 – 2015 14.5 28.7 45.5 48.9 30.6 19.8 33.8 2010 2011 2012 2013 2014 2015 2015 Currency Neutral* ($m) *Excluding restructuring cost and Currency Neutral: 2015 at 2014 exchange rates - 35% +10%
Q4 and FY - 2012 Presentation 7 Product Sales Quantity 2010 – 2015 (millions) 1.9 2.7 3.5 4.4 3.2 2.4 2010 2011 2012 2013 2014 2015 Sparkling Water Makers 10.3 13.3 16.5 21.5 25.0 26.8 2010 2011 2012 2013 2014 2015 Gas Refills 13.8 18.9 28.1 34.3 31.4 22.3 2010 2011 2012 2013 2014 2015 Flavors
Consolidated Statements of Operations Q4 - 2015 vs. Q4 - 2014 2014 2015 Reported Reported (Unadjusted) Restructuring Adjusted (Unadjusted) Restructuring Adjusted (Audited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) Revenue $126,526 $0 $126,526 $112,942 $0 $112,942 Cost of revenue 71,018 (8,307) 62,711 60,909 (2,171) 58,738 Gross profit 55,508 8,307 63,815 52,033 2,171 54,204 Operating expenses Sales and marketing 42,945 42,945 35,031 35,031 General and administrative 9,437 9,437 12,389 0 12,389 Other income, net 10,654 (7,342) 3,312 631 0 631 Total operating expenses 63,036 (7,342) 55,694 48,051 0 48,051 Operating income (7,528) 15,649 8,121 3,982 2,171 6,153 Interest expense (income), net (151) (151) 286 286 Other financial expense (income), net (383) (383) 20 20 Total financial expense (income), net (534) (534) 306 306 Income before income taxes (6,994) 15,649 8,655 3,676 2,171 5,847 Income tax expense 1,196 1,196 848 848 Net income for the period - $8,190 $15,649 $7,459 $2,828 $2,171 $4,999 Net income per share Basic - $0.39 $0.75 $0.36 $0.13 $0.11 $0.24 Diluted - $0.39 $0.74 $0.35 $0.13 $ 0.11 $0.24 Weighted average number of shares Basic 21,007 21,007 21,064 21,064 Diluted 21,076 21,076 21,151 21,151 8
Consolidated Statements of Operations FY - 2015 vs. FY - 2014 2014 2015 Reported Reported (Unadjusted) Restructuring Adjusted (Unadjusted) Restructuring Adjusted (Audited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) Revenue $511,774 $0 $511,774 $413,135 $2,820 $415,955 Cost of revenue 258,686 (8,307) 250,379 216,364 (6,698) 209,666 Gross profit 253,088 8,307 261,395 196,771 9,518 206,289 Operating expenses Sales and marketing 177,668 177,668 138,641 138,641 General and administrative 49,795 49,795 47,258 47,258 Other income, net 10,654 (7,342) 3,312 631 0 631 Total operating expenses 238,117 (7,342) 230,775 186,530 0 186,530 Operating income 14,971 15,649 30,620 10,241 9,518 19,759 Interest expense (income), net 401 401 350 350 Other financial expense (income), net (1,593) (1,593) (5,192) (5,192) Total financial expense (income), net (1,192) (1,192) (4,842) (4,842) Income before income taxes 16,163 15,649 31,812 15,083 9,518 24,601 Income tax expense 3,868 3,868 3,006 3,006 Net income for the period $12,295 $15,649 $27,944 $12,077 $9,518 $21,595 Net income per share Basic $0.59 $0.74 $1.33 $0.57 $ 0.46 $1.03 Diluted $0.58 $0.73 $1.31 $0.57 $0.45 $1.02 Weighted average number of shares Basic 20,968 20,968 21,037 21,037 Diluted 21,251 21,251 21,117 21,117 9
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