Got almond milk? If so, you're not alone.
For health and dietary reasons, consumers are increasingly
opting for plant-based alternatives to conventional dairy
In the past few years, almond milk has risen to the top of the
With a nearly two-thirds share in the U.S., it has surpassed
soy milk in popularity.
Beverage and packaged-goods companyWhiteWave Foods Co. (
) is feeling the love for almond milk.
First-quarter sales of its Silk-branded almond milk in North
America rose 52% from the prior year, helping drive total sales
up 13.2% to $171 million for the firm's North American
plant-based food and beverage segment.
Silk-branded soy milk and coconut milk are also part of the
category. The company doesn't break down sales by product
Demand for almond milk has been so strong that WhiteWave has
been "shifting shelf space away from soy to almond milk," CEO
Gregg Engles said on a first-quarter conference call.
WhiteWave plans to step up investments in production capacity
so it won't run out. The company focuses on high-growth food and
beverage categories that are aligned with emerging consumer
"The shift away from conventional dairy to plant-based
alternatives is becoming more of a mainstream phenomenon, and we
continue to be the beneficiary of that," Engles said.
The company manufactures, markets and distributes plant-based
food and beverages, coffee creamers and beverages, premium dairy
products and organic greens and produce in North America and
Europe. Its products are sold to grocery stores, mass
merchandisers, club stores, convenience stores and food-service
channels. Customers includeWal-Mart (
) andSafeway (
A new business in packaged organic greens and produce came via
WhiteWave's $600 million acquisition of organic-food company
Earthbound Farm in January.
With Earthbound Farm, WhiteWave now has a 56% share of the
branded organic packaged salad segment, according to
Earthbound added $146 million to WhiteWave's first-quarter
sales basket -- a big reason for the firm's 36.5% jump in total
revenue to $830 million.
Excluding Earthbound, sales in the quarter grew 12%.
WhiteWave's Q1 earnings climbed 38% to 22 cents a share.
"There are very few pockets of growth in food right now, and
health and wellness is one of them," said John Baumgartner,
analyst at Wells Fargo Securities.
WhiteWave has real cow's milk, too. It's the organic variety,
a category that has been taking share from conventional milk.
The company's organic milk is sold under the Horizon
WhiteWave's premium-dairy revenue, which includes organic
milk, rose 8.2% to $154 million during the first quarter,
accounting for nearly 20% of total revenue.
Coffee creamers and beverages, however, remain the company's
largest category, thanks to a consumer trend focused on
personalizing at-home coffee consumption. These products are
marketed under the International Delight and Land O'Lakes
First-quarter sales in the segment grew 9.3% to $234 million,
driven by new products and flavored creamers.
WhiteWave was spun off fromDean Foods (
) as a separately traded company in October 2012. Dean sold its
majority stake in WhiteWave several months later.
WhiteWave's sales and earnings have grown in double digits the
past five quarters. Analysts expect full-year earnings to
increase 32% in 2014 and an additional 18% in 2015.
While analysts predict a 32% gain in revenue this year, they
see an 8% rise in 2015 without the boost of an acquisition like
Meanwhile, Europe is providing another bounce for WhiteWave.
First-quarter revenue in Europe, which accounted for about 15% of
the total, rose 24% from the prior year to $126 million. Growth
was led again by almond-milk sales.
During the conference call, Engles said almond milk in Europe
is showing the same kind of growth seen in the U.S. four or five
years ago. Almond milk was launched in Europe less than two years
ago. Soy milk is still the top beverage there for WhiteWave.
One reason for the share shift from soy milk to almond milk in
the U.S., Baumgartner says, is due to studies that have linked
soy milk to increased risk for breast cancer because of its
estrogen levels. These studies have been disputed, however.
Dairy-milk alternatives come with different nutritional
benefits. Almond milk has fewer calories than soy milk and no
saturated fat, but little protein. It's high in vitamins E and
Soy milk has more protein, B vitamins and potassium and
magnesium. But it can cause bloating.
WhiteWave's plant-based food and beverage group in Europe
operates under the Alpro and Provamel brands. Alpro, which
includes almond and soy beverages, has the No. 1 market share in
its nine largest markets there.
China could become a meaningful contributor to WhiteWave
starting later this year through a joint venture with Mengniu
Dairy, the largest dairy company in China. WhiteWave is in the
process of commercializing the venture.
"Soy milk in China is a $2 billion category and growing over
10% (annually)," Baumgartner said.
Meanwhile, line extensions in the U.S. are ramping up this
year, including new almond and coconut milk blends under the Silk
Horizon has new snack crackers and cookies and macaroni and
cheese. The Earthbound division is bringing out new meal