Green Mountain Coffee Roasters, Inc. Reports Fourth Quarter and Fiscal Year 2012 Results

  Green Mountain Coffee Roasters, Inc. Reports Fourth Quarter and Fiscal Year
  2012 Results

 Fourth Quarter Fiscal 2012 Revenue Increases 33%, GAAP EPS Up 23%, Non-GAAP
                                EPS Grows 36%;

Fiscal Year 2012 Revenue Increases 46%, GAAP EPS Up 74% and Non-GAAP EPS Grows
      46%; Company Generates $77 million in Free Cash Flow for the Year

Business Wire

WATERBURY, Vt. -- November 27, 2012

Green Mountain Coffee Roasters, Inc., (GMCR) (NASDAQ: GMCR), a leader in
specialty coffee and coffee makers, today announced its fourth quarter and
fiscal year results for the 14 and 53 weeks ended September 29, 2012.


Fourth Quarter & Fiscal Year 2012 Performance Highlights

($ in             Fourteen     Thirteen                  Fifty-three     Fifty-two
millions          weeks        weeks                     weeks           weeks
except        ended      ended      %          ended         ended        %
earnings          Sept.        Sept.        Increase     Sept. 29,       Sept. 24,      Increase
per               29,          24,                       2012            2011
share)            2012         2011
Net Sales         $ 946.7    $ 711.9      33   %     $  3,859.2    $ 2,650.9      46   %
Operating
Income:
GAAP              $ 143.7      $ 106.7      35   %       $  568.9        $ 368.9        54   %
Non-GAAP          $ 157.1      $ 119.1      32   %       $  621.6        $ 428.7        45   %
Net
Income:
GAAP              $ 91.9       $ 75.4       22   %       $  362.6        $ 199.5        82   %
Non-GAAP          $ 101.0      $ 75.3       34   %       $  381.6        $ 248.9        53   %
Diluted
Income
Per
Share:
GAAP              $ 0.58       $ 0.47       23   %       $  2.28         $ 1.31         74   %
Non-GAAP          $ 0.64       $ 0.47       36   %       $  2.40         $ 1.64         46   %
EBITDA                                                   $  779.9        $ 472.5        65   %
(*)
                                                                                             
Note: Complete GAAP to Non-GAAP reconciliation tables provided with this release.
(*) EBITDA is earnings before interest, taxes, depreciation, and amortization.


“Our fourth quarter fiscal year 2012 revenue and earnings growth speaks to
GMCR’s continued strategic progress and we believe points to the significant
opportunity still ahead for the Company,” said GMCR’s President and CEO,
Lawrence J. Blanford. “We continue to drive awareness of Keurig^® single cup
brewing and consumers continue to embrace and adopt Keurig^® brewers and
Keurig Brewed^® beverages as an integral part of their daily routine.”

During 2012, the Harris Poll 2012 EquiTrend^® Study named Keurig^® the coffee
maker “Brand of the Year” and Green Mountain Coffee^® the coffee “Brand of the
Year.” In addition, Landor Associates’ annual Breakaway Brands Study, which
identifies U.S. brands showing sustained brand-strength growth over a
three-year period spanning 2008 through 2011, ranked the Keurig^® brand
second, with 79% growth in brand strength over the period.

“The innovative spirit that pervades the entire GMCR organization is nothing
less than inspiring,” continued Blanford. “In the span of less than ten
months, our organization has introduced two new brewing platforms, the
Keurig^® Vue^® brewer and in cooperation with our partner, Lavazza, the
Keurig^® Rivo™ Cappucino and Latte system. We also introduced a Vue^® model
for our away-from-home customers and multiple new beverages, including the
very first varieties in our new Wellness Brewed™ collection.”

“As we look to the future, we remain committed to bringing fresh ideas to
light; pushing forward disruptive technologies; and capturing true innovation
in products that delight consumers.” Blanford concluded, “We also remain
focused on driving sales and earnings in line with our longer term outlook and
continuing to allocate capital wisely to balance profitability, cash flow and
investment.”

Please note that the Company’s fiscal year 2012 included an additional week
(53^rd week). This unique calendar shift last occurred in fiscal year 2006 and
is not scheduled to occur again until fiscal year 2017. The 53^rd week added
approximately $90.0 million in net sales; approximately $11.0 million (net of
income taxes of $5.8 million) in net income; and, approximately $0.07 in
diluted earnings per share in the fourth quarter and fiscal year 2012.


Fiscal Year 2012 Financial Review
Net Sales
                  Fifty-three    Fifty-two                 
        Net Sales by  weeks ended     weeks ended
        Product
        ($ in         September 29,   September       $ Increase    % Increase
        millions)                     24,
                      2012           2011            (Decrease)   (Decrease)
        Single Serve  $    2,708.9    $  1,704.0      $ 1,004.9     59    %
        Packs
        Brewers and        759.8         524.7          235.1       45    %
        Accessories
        Other
        Products and      390.5        422.2         (31.7   )   (8    )%
        Royalties
        Total Net     $    3,859.2    $  2,650.9      $ 1,208.3    46    %
        Sales
                                                                          

  *Approximately 90% of consolidated fiscal year 2012 net sales were from
    sales of Keurig^® Single Cup Brewers, single serve packs, and
    Keurig^®-related accessories, with the remainder of net sales consisting
    primarily of sales of bagged coffee and sales from the office coffee
    services business.

       *The billion dollar increase in single serve pack net sales was driven
         by a 49 percentage point increase in sales volume; a 9 percentage
         point increase in K-Cup^® pack net price realization due primarily to
         price increases implemented during fiscal year 2011 to offset the
         then higher green coffee and the other input costs; and, a 2
         percentage point increase in K-Cup^® pack net sales due to the
         acquisition of Van Houtte. These increases in single serve pack net
         sales were offset by a 1 percentage point reduction due to single
         serve pack product mix.
       *GMCR sold 8.6 million Keurig^® Single Cup Brewers during fiscal year
         2012. This brewer shipment number does not account for consumer
         returns.
       *The Company estimates that the combination of brewer shipments from
         GMCR and its licensed partners resulted in shipments of 9.2 million
         Keurig^® Single Cup Brewers in fiscal year 2012.
       *Other products and royalties declined year-over-year primarily as a
         result of the sale of the Filterfresh on October 3, 2011.

Operating Metrics

  *In fiscal year 2012, gross margin declined to 32.9% from 34.1% in the
    prior year period.

       *The higher gross margin in fiscal 2011 compared to fiscal 2012
         primarily was due to demand-related investments in fiscal 2012,
         including the introduction of the Vue^® brewing system. This resulted
         in higher labor and overhead manufacturing costs associated with the
         ramp up in the Company’s manufacturing base.Unfavorable green coffee
         costs and an increase in single serve pack obsolescence also
         adversely impacted gross margin year over year.
       *These adverse impacts were partially offset by the net price
         realization from price increases taken on single serve packs in
         fiscal year 2011 to offset higher green coffee and other input costs
         experienced in fiscal year 2011 and the first half of fiscal year
         2012, as well as lower warranty-related expense compared to the prior
         year period.
       *The following table quantifies the changes in gross margin period to
         period:

                                                                    Change
                                                                FY 2011 to
                                                                    FY 2012
                                                                    
Net price realization - single serve packs                          +260 bps
Higher manufacturing costs due to ramp up in manufacturing          -220 bps
base
Unfavorable green coffee costs                                      -80 bps
Increase in obsolescence                                            -70 bps
Vue®-related impact                                                 -50 bps
Lower warranty expense                                              +40 bps

  *GAAP operating margin of 14.7% of net sales in fiscal year 2012 increased
    from 13.9% in the prior year period as a result of operating expense
    leverage.
  *Non-GAAP operating margin, which excludes $6.7 million in expenses
    associated with the SEC inquiry and pending litigation in the year, as
    well as $46.0 million in amortization of identifiable intangibles related
    to the Company’s acquisitions, was 16.1% of net sales in fiscal year 2012
    compared to 16.2% in the prior year period.
  *The Company’s effective income tax rate was 36.9% for fiscal year 2012 as
    compared to a 33.6% effective tax rate for the prior year period.The
    increase is attributable to the release of valuation allowances related to
    a $17.7 million capital loss carryforward and a $5.4 million net operating
    loss carryforward in the fourth quarter of fiscal year 2011 associated
    with the Company’s sale of Filterfresh.
  *Diluted weighted average shares outstanding as of fiscal year 2012
    increased to 159.1 million from 152.1 million in the prior year period.
  *Under its Board-authorized share repurchase program the Company
    repurchased 3.1 million shares in the fiscal year, with all of the
    purchases occurring in the fourth quarter of fiscal year 2012.
  *GMCR allocates a portion of its pre-tax profit to social and environmental
    projects. In fiscal year 2012, as a result of improved profitability, GMCR
    allocated $28.8 million to these efforts, up from $15.2 million in fiscal
    year 2011.

       *Included in this total is record volunteerism by the Company’s
         employees under its Café Time, or "Community Action for Employees"
         programs. GMCR encourages its employees to volunteer up to 52 hours
         annually of company-paid service to give back to local organizations
         and communities.
       *The number of employees participating in volunteer efforts increased
         81% in fiscal year 2012 to 3,643 from 2,018 in fiscal year 2011,
         driving volunteer hours to increase 129% in fiscal year 2012 to
         70,181 hours from 30,586 hours in fiscal year 2011.

Balance Sheet & Cash Flow Highlights

“Stronger than expected fourth quarter fiscal year 2012 sales combined with
ongoing inventory management efforts and lower-than-forecasted capital
investment enabled us to generate free cash flow ahead of plan,” said Frances
G. Rathke, GMCR’s Chief Financial Officer. “We expect to continue to
strategically invest in the business as demand warrants, and continue to
forecast free cash flow in a range of $100 million to $150 million for fiscal
year 2013.”


Balance Sheet & Cash Flow Highlights
($ in millions)      September  September 24,   $ Increase  % Increase
                         29,
                         2012       2011             (Decrease)  (Decrease)
Cash and cash            $  71.2     $  40.5           $  30.7      76     %
equivalents
Accounts                 $  363.8    $  310.3          $  53.5      17     %
receivable, net
Inventories              $  768.4    $  672.2          $  96.2      14     %
Raw materials &          $  229.9    $  182.8          $  47.1      26     %
supplies
Coffee                   $  148.9    $  115.5          $  33.4      29     %
Packaging &
other raw                $  81.0     $  67.3           $  13.7      20     %
materials
Finished goods           $  538.5    $  489.4          $  49.1      10     %
Brewers &                $  384.3    $  279.3          $  105.0     38     %
accessories
Single serve             $  120.9    $  173.5          $  (52.6 )   (30    )%
packs
Other                    $  33.3     $  36.6           $  (3.3  )   (9     )%
Debt outstanding
and capital
lease and                $  531.5    $  582.6          $  (51.1 )   (9     )%
financing
obligations
Cash provided by
operating                $  477.8    $  0.8            $  477.0     59625  %
activities (1)
Free cash flow           $  76.7     $  (282.7  )      $  359.5     N/A
(1) (*)

(1) represents 53 weeks for fiscal 2012 and 52 weeks for fiscal 2011.
(*) Free cash flow is calculated by subtracting capital expenditures for fixed
assets from net cash provided by operating activities as reported in the
unaudited consolidated statements of cash flows.

Fourth Quarter Fiscal Year 2012 Financial Review
      Net Sales
                     Fourteen   Thirteen               
       Net Sales by          weeks       weeks
       Product               ended       ended
       ($ in                 September   September     $ Increase   % Increase
       millions)             29,         24,
                             2012       2011          (Decrease)  (Decrease)
                                        
       Single Serve          $   700.2   $   475.5     $  224.7     47    %
       Packs
       Brewers and               150.1       115.1        35.0      30    %
       Accessories
       Other
       Products and             96.4       121.3       (24.9 )   (21   )%
       Royalties
       Total Net             $   946.7   $   711.9     $  234.8    33    %
       Sales
                                                                          

  *Approximately 90% of consolidated fourth quarter fiscal year 2012 net
    sales were from sales of Keurig^® Single Cup Brewers, single serve packs,
    and Keurig^®-related accessories, with the remainder of net sales
    consisting primarily of sales of bagged coffee and sales from the office
    coffee services business.

       *The increase in single serve pack sales was driven by a 50 percentage
         point increase in sales volume. This increase was offset by a 2
         percentage point decrease due to the impact of single serve pack
         product mix and a 1% decrease due to the net price realization on
         single serve packs.
       *GMCR sold 1.8 million Keurig^® Single Cup Brewers during the fourth
         quarter of fiscal year 2012. This brewer shipment number does not
         account for consumer returns.
       *The Company estimates that the combination of brewer shipments from
         GMCR and its licensed partners resulted in shipments of 2.0 million
         Keurig^® Single Cup Brewers in the fourth quarter of fiscal year
         2012.
       *Fourth quarter fiscal year 2012 net sales included $9.6 million of
         sales of Vue^® brewers and Vue^® packs.
       *Other products and royalties declined year-over-year primarily as a
         result of the sale of the Filterfresh on October 3, 2011.

Operating Metrics

  *In the fourth quarter of fiscal year 2012, gross margin declined to 33.4%
    from 35.7% in the prior year period.

       *The higher gross margin in the fourth quarter of fiscal 2011 compared
         to the fourth quarter of fiscal 2012 primarily was due to
         demand-related investments in fiscal 2012, including the introduction
         of the Vue^® brewing system. This resulted in higher labor and
         overhead manufacturing costs associated with the ramp up in the
         Company’s manufacturing base.
       *These adverse impacts were partially offset by a decrease in green
         coffee costs in the quarter compared to the prior year period.
       *The following table quantifies the changes in gross margin period to
         period:

                                                                    Change
                                                                Q4 2011 to
                                                                    Q4 2012
                                                                    
Higher manufacturing costs due to ramp up in manufacturing          -280 bps
base
Favorable green coffee costs                                        +100 bps
Vue®-related impact                                                 -50 bps

  *GAAP operating margin of 15.2% of net sales in the fourth quarter of
    fiscal year 2012 increased from 15.0% in the prior year period.
  *Non-GAAP operating margin, which excludes $1.9 million in expenses
    associated with the SEC inquiry and pending litigation in the quarter, as
    well as $11.5 million in amortization of identifiable intangibles related
    to the Company’s acquisitions, was 16.6% of net sales in the fourth
    quarter of fiscal year 2012 compared to 16.7% in the prior year period.
  *The Company’s effective income tax rate was 34.6% for the fourth quarter
    of fiscal year 2012 as compared to 23.7% for the prior year period. The
    increase is attributable to the release of valuation allowances related to
    a $17.7 million capital loss carryforward and a $5.4 million net operating
    loss carryforward in the fourth quarter of fiscal year 2011 associated
    with the Company’s sale of Filterfresh.
  *Diluted weighted average shares outstanding as of the end of the fourth
    quarter of fiscal year 2012 decreased to 158.1 million from 159.2 million
    in the prior year period in part as a result of 3.1 million shares
    repurchased in the fourth quarter of fiscal year 2012 as part of the
    Company’s previously announced share repurchase program.

Business Outlook and Other Forward-Looking Information

Company Estimates for First Quarter and Fiscal Year 2013

The Company provided its outlook for its first quarter of fiscal year 2013:

  *Total net sales growth in the range of 14% to 18% over the first quarter
    of fiscal year 2012.
  *First quarter fiscal year 2013 non-GAAP earnings per diluted share in a
    range of $0.62 to $0.67 per diluted share, excluding approximately $0.06
    per share due to the amortization of identifiable intangibles related to
    the Company’s acquisitions; any acquisition-related transaction expenses;
    and, legal and accounting expenses related to the SEC inquiry and the
    Company’s pending litigation. The Company’s first quarter of fiscal year
    2013 non-GAAP earnings per diluted share estimate includes the impact of
    shares repurchased prior to November 27, 2012 as part of its previously
    announced share repurchase program, but excludes any impact from potential
    future Company share repurchases.

The Company reiterated its net sales growth, capital expenditures and free
cash flow estimates and refined its non-GAAP earnings per share outlook for
its fiscal year 2013:

  *Total fiscal year 2013 net sales growth in the range of 15% to 20% over
    fiscal year 2012.
  *Fiscal year 2013 non-GAAP earnings per diluted share in a range of $2.64
    to $2.74 per diluted share, excluding approximately $0.23 per share due to
    the amortization of identifiable intangibles related to the Company’s
    acquisitions; any acquisition-related transaction expenses; and legal and
    accounting expenses related to the SEC inquiry and the Company’s pending
    litigation. The Company’s fiscal year 2013 non-GAAP earnings per diluted
    share estimate includes the impact of shares repurchased prior to November
    27, 2012 as part of its previously announced share repurchase program, but
    excludes any impact from potential future Company share repurchases.
  *Capital expenditures in the range of $380 million to $430 million.
  *Free cash flow in the range of $100 million to $150 million.

Use of Non-GAAP Financial Measures

In addition to reporting financial results in accordance with generally
accepted accounting principles (GAAP), the Company provides non-GAAP operating
results that exclude certain charges or credits such as transaction expenses
related to the Company’s acquisitions including the foreign exchange impact of
hedging the risk associated with the Canadian dollar purchase price of the Van
Houtte acquisition; any gain from sale of the Filterfresh U.S.-based coffee
services business; legal and accounting expenses related to the SEC inquiry
and pending litigation; and non-cash related items such as amortization of
identifiable intangibles and losses incurred on the extinguishment of debt,
each of which include adjustments to show the tax impact of excluding these
items. These amounts are not in accordance with, or an alternative to, GAAP.
The Company’s management believes that these measures provide investors with
transparency by helping illustrate the underlying financial and business
trends relating to the Company’s results of operations and financial condition
and comparability between current and prior periods. Management uses the
measures to establish and monitor budgets and operational goals and to
evaluate the performance of the Company. Please see the “GAAP to Non-GAAP
Reconciliation of Unaudited Consolidated Statements of Operations” tables that
accompany this document for a full reconciliation the Company’s GAAP to
non-GAAP results.

Conference Call and Webcast

Green Mountain Coffee Roasters, Inc. will be discussing these financial
results with analysts and investors in a conference call and live webcast
available via the Internet at 5:00 p.m. ET today, November 27, 2012.
Management’s prepared remarks on its quarterly results will be provided via a
Current Report on Form 8-K and also posted under the events link in the
Investor Relations section of the Company’s website at www.GMCR.com. As a
result, the conference call will include only brief remarks by management
followed by a question and answer session. The call along with accompanying
slides is accessible via live webcast from the events link in the Investor
Relations portion of the Company’s website at
http://investor.gmcr.com/events.cfm. The Company archives the latest
conference call for a period of time. A replay of the conference call also
will be available by telephone at (719) 785-1749, Passcode 4771050 from 9:00
p.m. ET on November 27, 2012 through 9:00 p.m. ET on Sunday, December 2, 2012.

About Green Mountain Coffee Roasters, Inc.

As a leader in specialty coffee and coffee makers, Green Mountain Coffee
Roasters, Inc. (GMCR) (NASDAQ: GMCR), is recognized for its award-winning
coffees, innovative Keurig^® Single Cup brewing technology, and socially
responsible business practices. GMCR supports local and global communities by
offsetting 100% of its direct greenhouse gas emissions, investing in
sustainably-grown coffee, and donating a portion of its pre-tax profits to
social and environmental projects.

GMCR routinely posts information that may be of importance to investors in the
Investor Relations section of its website, including news releases and its
complete financial statements, as filed with the SEC. The Company encourages
investors to consult this section of its website regularly for important
information and news. Additionally, by subscribing to the Company’s automatic
email news release delivery, individuals can receive news directly from GMCR
as it is released.

Forward-Looking Statements

Certain information contained in this release, including statements concerning
expected performance such as those relating to net sales, earnings, cost
savings, acquisitions and brand marketing support, are “forward-looking
statements”. Generally, these statements may be identified by the use of words
such as “may,” “will,” “would,” “expect,” “should,” “anticipate,” “estimate,”
“believe,” “forecast,” “intend,” “plan” and similar expressions intended to
identify forward-looking statements. These statements may relate to: the
expected impact of raw material costs and our pricing actions on our results
of operations and gross margins, expected trends in net sales and earnings
performance and other financial measures, the expected productivity and
working capital improvements, the ability to maximize or successfully assert
our intellectual property rights, the success of introducing and producing new
product offerings, ability to attract and retain senior management, the impact
of foreign exchange fluctuations, the adequacy of internally generated funds
and existing sources of liquidity, such as the availability of bank financing,
the expected results of operations of businesses acquired by us, our ability
to issue debt or additional equity securities, our expectations regarding
purchasing shares of our common stock under the existing authorizations, and
the impact of the inquiry initiated by the SEC and any related litigation or
additional governmental inquiry or enforcement proceedings.

These and other forward-looking statements are based on management’s current
views and assumptions and involve risks and uncertainties that could
significantly affect expected results. Results may be materially affected by
external factors such as damage to our reputation or brand name, business
interruptions due to natural disasters or similar unexpected events, actions
of competitors, customer relationships and financial condition, the ability to
achieve expected cost savings and margin improvements, the successful
acquisition and integration of new businesses, fluctuations in the cost and
availability of raw and packaging materials, changes in regulatory
requirements, and global economic conditions generally which would include the
availability of financing, interest, inflation rates and investment return on
retirement plan assets, as well as foreign currency fluctuations, risks
associated with our information technology systems, the threat of data
breaches or cyber-attacks, and other risks described in the Company’s filings
with the Securities and Exchange Commission.

Actual results could differ materially from those projected in the
forward-looking statements. The Company undertakes no obligation to update or
revise publicly, any forward-looking statements, whether as a result of new
information, future events or otherwise, except as may be required by law.

GMCR-C

                                                          
                                                                 
GREEN MOUNTAIN COFFEE ROASTERS, INC.
Unaudited Consolidated Balance Sheets
(Dollars in thousands)
                                                                 
                                               September 29,     September 24,
                                               2012              2011
Assets
Current assets:
Cash and cash equivalents                      $  58,289         $ 12,989
Restricted cash and cash equivalents              12,884           27,523
Receivables, less uncollectible
accounts and return allowances
of $34,517 and $21,407 at September
29, 2012 and
September 24, 2011, respectively                  363,771          310,321
Inventories                                       768,437          672,248
Income taxes receivable                           32,943           18,258
Other current assets                              35,019           28,072
Deferred income taxes, net                        51,613           36,231
Current assets held for sale                     -               25,885    
Total current assets                              1,322,956        1,131,527
                                                                 
Fixed assets, net                                 944,296          579,219
Intangibles, net                                  498,352          529,494
Goodwill                                          808,076          789,305
Other long-term assets                            42,109           47,759
Long-term assets held for sale                   -               120,583   
                                                                 
Total assets                                   $  3,615,789      $ 3,197,887 
                                                                 
Liabilities and Stockholders' Equity
Current liabilities:
Current portion of long-term debt              $  6,691          $ 6,664
Current portion of capital lease and              3,057            5
financing obligations
Accounts payable                                  279,577          265,511
Accrued compensation costs                        38,458           43,260
Accrued expenses                                  132,992          92,120
Income tax payable                                29,322           9,617
Deferred income taxes, net                        245              243
Other current liabilities                         29,645           34,613
Current liabilities related to assets            -               19,341    
held for sale
Total current liabilities                         519,987          471,374
                                                                 
Long-term debt, less current portion              466,984          575,969
Capital lease and financing                       54,794           -
obligations, less current portion
Deferred income taxes, net                        270,348          189,637
Other long-term liabilities                       32,544           27,184
Long-term liabilities related to                  -                474
assets held for sale
                                                                 
Commitments and contingencies
                                                                 
Redeemable noncontrolling interests               9,904            21,034
                                                                 
Stockholders' equity:
Preferred stock, $0.10 par value:
Authorized - 1,000,000 shares;
No shares issued or outstanding                   -                -
Common stock, $0.10 par value:
Authorized - 500,000,000 shares;
Issued and outstanding - 152,680,855
and 154,466,463 shares at September               15,268           15,447
29, 2012 and September 24, 2011,
respectively
Additional paid-in capital                        1,464,560        1,499,616
Retained earnings                                 771,200          411,727
Accumulated other comprehensive income           10,200          (14,575   )
(loss)
Total stockholders' equity                       2,261,228       1,912,215 
                                                                 
Total liabilities and stockholders'            $  3,615,789      $ 3,197,887 
equity
                                                                 
                                                                 

GREEN MOUNTAIN COFFEE ROASTERS, INC.
Unaudited Consolidated Statements of Operations
(Dollars in thousands except per share data)
                                                                     
                       Fourteen          Thirteen          Fifty-three       Fifty-two
                       weeks ended       weeks ended       weeks ended       weeks ended
                       September 29,     September 24,     September 29,     September 24,
                       2012              2011              2012              2011
Net sales              $ 946,736         $ 711,883         $ 3,859,198       $ 2,650,899
Cost of sales           630,290         457,793         2,589,799       1,746,274   
Gross profit             316,446           254,090           1,269,399         904,625
                                                                             
Selling and
operating                111,048           95,150            481,493           348,696
expenses
General and
administrative          61,661          52,228          219,010         187,016     
expenses
Operating                143,737           106,712           568,896           368,913
income
                                                                             
Other income             230               (285        )     1,819             648
(expense), net
Gain (loss) on
financial                (4,731      )     5,574             (4,945      )     (6,245      )
instruments,
net
Gain (loss) on
foreign                  5,812             (7,555      )     7,043             (2,912      )
currency, net
Gain on sale             -                 -                 26,311            -
of subsidiary
Interest                (4,321      )    (5,097      )    (22,983     )    (57,657     )
expense
Income before            140,727           99,349            576,141           302,747
income taxes
                                                                             
Income tax              (48,692     )    (23,528     )    (212,641    )    (101,699    )
expense
Net Income             $ 92,035          $ 75,821          $ 363,500         $ 201,048
                                                                             
Net income
attributable
to                      148             452             872             1,547       
noncontrolling
interests
                                                                             
Net income
attributable           $ 91,887         $ 75,369         $ 362,628        $ 199,501     
to GMCR
                                                                             
                                                                             
Basic income
per share:
Basic weighted
average shares           154,557,765       153,837,445       154,933,948       146,214,860
outstanding
Net income per
common share -         $ 0.59            $ 0.49            $ 2.34            $ 1.36
basic
                                                                             
Diluted income
per share:
Diluted
weighted                 158,094,806       159,207,852       159,075,646       152,142,434
average shares
outstanding
Net income per
common share -         $ 0.58            $ 0.47            $ 2.28            $ 1.31
diluted
                                                                                           
                                                                                           

GREEN MOUNTAIN COFFEE ROASTERS, INC.
Unaudited Consolidated Statements of Cash Flows
(Dollars in thousands)
                                                         
                                              Fifty-three       Fifty-two
                                              weeks ended       weeks ended
                                              September 29,     September 24,
                                              2012              2011
Cash flows from operating activities:
Net income                                    $  363,500        $ 201,048
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation                                     135,656          72,297
Amortization of intangibles                      45,991           41,339
Amortization deferred financing fees             6,050            6,158
Loss on extinguishment of debt                   -                19,732
Unrealized (gain) loss of foreign                (6,557   )       1,041
currency
Loss on disposal of fixed assets                 2,517            884
Gain on sale of subsidiary, excluding            (28,914  )       -
transaction costs
Provision for doubtful accounts                  3,197            2,584
Provision for sales returns                      107,436          64,457
Unrealized loss on financial                     6,310            3,292
instruments, net
Tax benefit from exercise of
non-qualified options and                        (1,006   )       (6,142     )
disqualified dispositions of
incentive stock options
Excess tax benefits from equity-based            (12,070  )       (67,813    )
compensation plans
Deferred income taxes                            60,856           (8,828     )
Deferred compensation and stock                  18,079           10,575
compensation
Other                                            334              -
Changes in assets and liabilities,
net of effects of acquisition:
Receivables                                      (159,317 )       (157,329   )
Inventories                                      (92,862  )       (375,709   )
Income tax receivable/payable, net               16,457           63,487
Other current assets                             (6,900   )       (715       )
Other long-term assets, net                      (469     )       (11,454    )
Accounts payable                                 (17,668  )       106,202
Accrued compensation costs                       (4,908   )       2,233
Accrued expenses                                 39,701           25,600
Other current liabilities                        (2,718   )       (3,118     )
Other long-term liabilities                     5,090          10,964     
Net cash provided by operating                   477,785          785
activities
                                                                
Cash flows from investing activities:
Change in restricted cash                        (2,875   )       2,074
Acquisition of LJVH Holdings, Inc.               -                (907,835   )
(Van Houtte), net of cash acquired
Proceeds from sale of subsidiary, net            137,733          -
of cash transferred
Capital expenditures for fixed assets            (401,121 )       (283,444   )
Other investing activities                      618            1,533      
Net cash used in investing activities            (265,645 )       (1,187,672 )
                                                                
Cash flows from financing activities:
Net change in revolving line of                  (108,727 )       333,835
credit
Proceeds from issuance of common                 12,092           17,328
stock under compensation plans
Proceeds from issuance of common                 -                291,096
stock for private placement
Proceeds from issuance of common                 -                673,048
stock in public equity offering
Financing costs in connection with               -                (25,685    )
public equity offering
Repurchase of common stock                       (76,470  )       -
Excess tax benefits from equity-based            12,070           67,813
compensation plans
Payments on capital lease and                    (7,558   )       (8         )
financing obligations
Proceeds from borrowings of long-term            -                796,375
debt
Deferred financing fees                          -                (46,009    )
Repayment of long-term debt                      (7,814   )       (906,885   )
Other financing activities                      3,283          (1,063     )
Net cash (used in) provided by                   (173,124 )       1,199,845
financing activities
                                                                
Change in cash balances included in              5,160            (5,160     )
current assets held for sale
                                                                
Effect of exchange rate changes on               1,124            790
cash and cash equivalents
                                                                
Net increase in cash and cash                    45,300           8,588
equivalents
Cash and cash equivalents at                    12,989         4,401      
beginning of period
Cash and cash equivalents at end of           $  58,289        $ 12,989     
period
                                                                
Supplemental disclosures of cash flow
information:
Cash paid for interest                        $  20,783         $ 33,452
Cash paid for income taxes                    $  136,407        $ 58,182
Fixed asset purchases included in
accounts payable and not disbursed at         $  56,127         $ 25,737
the end of each period
Noncash financing and investing
activities:
Fixed assets acquired under capital           $  66,531         $ -
lease and financing obligations
                                                                             
                                                                             

GREEN MOUNTAIN COFFEE ROASTERS, INC.
GAAP to Non-GAAP Reconciliation
(Dollars in thousands, except per share data)
                                                           
                                                 Fourteen        Thirteen
                                                 weeks ended     weeks ended
                                                 September 29,   September 24,
                                                 2012            2011
                                                                 
Operating income                                 $   143,737     $  106,712
Expenses related to SEC inquiry (1)                  1,858          675
Amortization of identifiable intangibles            11,495        11,752   
(2)
Non-GAAP operating income                        $   157,090     $  119,139  
                                                                 
                                                                 
                                                 Fourteen        Thirteen
                                                 weeks ended     weeks ended
                                                 September 29,   September 24,
                                                 2012            2011
                                                                 
Net income attributable to GMCR                  $   91,887      $  75,369
After tax:
Expenses related to SEC inquiry (1)                  1,184          453
Amortization of identifiable intangibles             7,897          7,829
(2)
Net operating and capital loss                      -             (8,376   )
carryforwards (3)
Non-GAAP net income                              $   100,968     $  75,275   
                                                                 
                                                                 
                                                 Fourteen        Thirteen
                                                 weeks ended     weeks ended
                                                 September 29,   September 24,
                                                 2012            2011
                                                                 
Diluted income per share                         $   0.58        $  0.47
After tax:
Expenses related to SEC inquiry (1)                  0.01           0.00
Amortization of identifiable intangibles             0.05           0.05
(2)
Net operating and capital loss                      -             (0.05    )
carryforwards (3)
Non-GAAP net income per share                    $   0.64        $  0.47     

(1) Represents legal and accounting expenses related to the SEC inquiry and
pending litigation classified as general and administrative expense.
(2) Represents the amortization of intangibles related to the Company’s
acquisitions classified as general and administrative expense.
(3) Represents the release of the valuation allowance against federal capital
loss carryforwards which represents the estimate of the tax benefit for the
amount of capital losses that were utilized in the first quarter of fiscal
2012 on capital gains generated on the sale of Filterfresh and the utilization
in fiscal 2011 of net operating loss carryforwards generated from the
Filterfresh acquisition.


GREEN MOUNTAIN COFFEE ROASTERS, INC.
GAAP to Non-GAAP Reconciliation
(Dollars in thousands, except per share data)
                                                            
                                             Fifty-three       Fifty-two
                                             weeks ended       weeks ended
                                             September 29,     September 24,
                                             2012              2011
Operating income                             $  568,896        $  368,913
Acquisition-related expenses (1)                -                 10,573
Expenses related to SEC inquiry (2)             6,669             7,868
Amortization of identifiable intangibles       45,991          41,339   
(3)
Non-GAAP operating income                    $  621,556       $  428,693  
                                                                             
                                                                             
                                             Fifty-three       Fifty-two
                                             weeks ended       weeks ended
                                             September 29,     September 24,
                                             2012              2011
Net income attributable to GMCR              $  362,628        $  199,501
After tax:
Acquisition-related expenses (7)                -                 14,524
Expenses related to SEC inquiry (2)             4,073             4,895
Amortization of identifiable intangibles        31,555            27,343
(3)
Loss on extinguishment of debt (4)              -                 11,027
Net operating and capital loss                                    (8,376   )
carryforwards (5)
Gain on sale of subsidiary (6)                 (16,685  )       -        
Non-GAAP net income                          $  381,571       $  248,914  
                                                                             
                                                                             
                                             Fifty-three       Fifty-two
                                             weeks ended       weeks ended
                                             September 29,     September 24,
                                             2012              2011
Diluted income per share                     $  2.28           $  1.31
After tax:
Acquisition-related expenses (7)                -                 0.10
Expenses related to SEC inquiry (2)             0.03              0.03
Amortization of identifiable intangibles        0.20              0.18
(3)
Loss on extinguishment of debt (4)              -                 0.07
Net operating and capital loss                  -                 (0.06    )
carryforwards (5)
Gain on sale of subsidiary (6)                 (0.10    )       -        
Non-GAAP net income per share                $  2.40      *   $  1.64      *

*Does not sum due to rounding.
                                                                             

(1) Represents direct acquisition-related expenses classified as general and
administrative expense.
(2) Represents legal and accounting expenses related to the SEC inquiry and
pending litigation classified as general and administrative expense.
(3) Represents the amortization of intangibles related to the Company’s
acquisitions classified as general and administrative expense.
(4) Represents the write-off of debt issuance costs and original issue
discount, net of tax, primarily associated with the extinguishment of the Term
B loan under the Credit Agreement.
(5) Represents the release of the valuation allowance against federal capital
loss carryforwards which represents the estimate of the tax benefit for the
amount of capital losses that were utilized in the first quarter of fiscal
2012 on capital gains generated on the sale of Filterfresh and the utilization
in fiscal 2011 of net operating loss carryforwards generated from the
Filterfresh acquisition.
(6) Represents the gain recognized on the sale of Filterfresh, net of income
taxes of $9.6 million. The income taxes of $9.6 million include the tax
benefit resulting from the release of the valuation allowance in fiscal 2011.
(7) The 2011 fiscal year reflects direct acquisition-related expenses of $10.6
million ($8.9 million after-tax); the write-off of deferred financing expenses
of $2.6 million ($1.6 million after-tax) on our Former Credit Facility in
conjunction with the new financing secured for the Van Houtte acquisition; and
the foreign exchange impact of hedging the risk associated with the Canadian
dollar purchase price of the Van Houtte acquisition of $5.3 million ($4.0
million after-tax).

Contact:

Green Mountain Coffee Roasters
Suzanne DuLong, 802-488-2600
VP IR & Corporate Comm
Investor.Services@GMCR.com
or
Katie Gilroy, 781-205-7345
Corporate Comm Manager
Investor.Services@GMCR.com
 
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