SodaStream International Ltd.
) better-than-expected third quarter results marked yet another
robust quarterly performance for this leading soda maker. The
company's earnings have now outperformed the Zacks Consensus
Estimate for eight consecutive quarters. Buoyed by the strong
results, the company also upped its financial outlook for the
Adjusted earnings of 80 cents per share outpaced the Zacks
Consensus Estimate of 68 cents by 17.7%. Solid top-line growth
also drove the earnings 66.7% higher from 48 cents recorded a
Revenue and Margins
Revenue of $112.5 million increased 48.7% year over year on
the back of strong performance of both the product categories
(soda makers and consumables) and all the four geographic
regions. Total revenue also beat the Zacks Consensus Estimate of
Revenue increased 61% in Americas, 33% in Western Europe, 37%
in Central and Eastern Europe, Middle East, Africa and 145% in
Asia/Pacific. Among the products categories, soda maker sales
increased 21% year over year with a significant gain in the
Gross margins improved 70 basis points (bps) due to increase
in revenue from direct distribution and better fixed cost
leverage. Operating margin improved 160 bps year over year driven
by better gross margins and lower general and administrative
expenses, which partially offset the rise in marketing costs.
Following the solid third quarter results, SodaStream is
confident about the next quarter and thus upped its outlook for
the full year.
For 2012, SodaStream expects yearly revenue growth of 46%, up
from prior expectation of a growth of 40%. Net income is expected
to go up by 59%, up from its previous guidance of 55%. For the
fourth quarter, the company expects demand to be stronger than
Though SodaStream carries a Zacks #3 Rank (short term 'Hold'
rating), it has bright prospects going forward. Solid demand,
expanding strategic partnerships like with
Kraft Foods Group, Inc.
), enhanced marketing activities, regular product innovations,
accretive acquisitions and successful strategic investments will
drive the stock going forward. We cannot rule out a Zacks Rank
upgrade for this stock in the near term.
Based in Israel, Soda Stream commands a global leadership
position in home beverage carbonation market. These soda making
systems, sold mainly under the SodaStream brand name, offer a
healthier way to enjoy carbonated beverages at home. SodaStream's
products are primarily sold at huge retail stores like
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