SodaStream Reports Record Fourth Quarter Results

               SodaStream Reports Record Fourth Quarter Results

Fourth Quarter Revenue Increased 55% to $132.9 Million

Full Year Revenue Increased 51% to $436.3 Million

Fourth Quarter Net Income Increased 42% to $7.5 Million

Full Year Net Income Increased 60% to $43.9 Million

PR Newswire

AIRPORT CITY, Israel, Feb. 20, 2013

AIRPORT CITY, Israel, Feb. 20, 2013 /PRNewswire/ -- SodaStream International
Ltd. (NASDAQ: SODA), a leading manufacturer of home beverage carbonation
systems, announced today its results for the three and twelve month periods
ended December 31, 2012.

For the fourth quarter ended December 31, 2012:

  oTotal revenue increased 55.2% to $132.9 million from $85.7 million in the
    fourth quarter 2011.
  oNet income increased 41.6% to $7.5 million compared to $5.3 million a year
    ago, and Adjusted net income was $9.4 million compared to $6.7 million in
    the prior year.
  oDiluted earnings per share increased 38.5% to $0.36, compared to $0.26 in
    the fourth quarter 2011 and Adjusted diluted earnings per share were $0.45
    compared to $0.32 in the prior year.

For the year ended December 31, 2012:

  oTotal revenue increased 51.0% to $436.3 million from $289.0 million in
    2011.
  oNet income increased 59.6% to $43.9 million compared to $27.5 million a
    year ago, and Adjusted net income was $50.0 million compared to $32.9
    million in the prior year.
  oDiluted earnings per share increased 56.0% to $2.09, compared to $1.34 in
    2011 and Adjusted diluted earnings per share were $2.39 compared to $1.60
    in the prior year.

"Our fourth quarter performance was marked by significant growth in all major
areas of our business and represents a strong finish to another record year,"
said Daniel Birnbaum, Chief Executive Officer of SodaStream. "Our efforts
throughout 2012 to increase global awareness of our brand and category and
expand our retail presence culminated in a very successful holiday season.
For the first time ever we exceeded 1 million soda makers sold in a quarter,
resulting in approximately 3.5 million soda makers for the year. Notably, U.S.
sell-through of soda makers and consumables exceeded expectations, continuing
our growth trajectory in the world's biggest soda market. We believe the
growing strength of our brand equity driven by our new branding campaign,
strategic partnerships and innovative product portfolio, including our newest
soda maker, the Source, all set the stage for continued growth in 2013 and
beyond."

Fourth Quarter 2012 Financial Review
Geographical Revenue Breakdown


Revenue                       Three Months Ended
                              December 31,  December 31,  Increase  Increase
                              2011          2012
                              In Millions USD                        %
The Americas                  $    32.0     $    62.8     $   30.8   96%
Western Europe                     39.7          51.9         12.2   31%
Asia-Pacific                       8.8           11.6         2.8    31%
Central & Eastern Europe,          5.2           6.6          1.4    28%
Middle East, Africa
Total                         $    85.7     $    132.9    $   47.2   55%



Product Segment Revenue
Breakdown


Revenue           Three Months Ended
                  December 31,    December 31,    Increase       Increase
                  2011            2012            (decrease)
                                                                  (decrease)
                  In millions USD                                     %
Soda Maker        $     40.7      $     66.1      $     25.4          62%
Starter Kits
Consumables             42.3            64.8            22.5          54%
Other                   2.7             2.0             (0.7)         (28)%
Total             $     85.7      $     132.9     $     47.2          55%



Product Segment Unit Breakdown


                        Three Months Ended
                        December 31,  December 31,
                                                    Increase  Increase
                        2011          2012
                        In thousands                           %
Soda Maker Starter Kits 767           1,111         344        45%
CO2 Refills             3,414         4,308         894        26%
Flavors                 4,592         7,362         2,770      60%



Gross margin for the fourth quarter 2012 was 53.0%, compared to 57.3% for the
same period in 2011. The decrease was in-line with guidance and primarily due
to higher dependency on subcontractors and expedited shipments including air
freight of raw materials and finished goods mainly to support the Source
launch and to fulfill better than expected overall demand. This negative
impact on the gross margin was partially offset by an increase in direct
distribution that accounted for 82% of total revenue in the quarter compared
to 75% in the fourth quarter 2011. The increase in direct distribution is
mainly due to growth in U.S. revenue and the shift to self-distribution in the
Nordics.

Sales and marketing expenses for the fourth quarter 2012 totaled $52.8
million, or 39.7% of revenue, compared to $36.4 million, or 42.5% of revenue,
for the comparable period in the prior year. The 280 basis point improvement
is mainly attributable to a decrease in advertising and promotion expense as a
percent of revenue to 22.7% compared to 25.1% in the fourth quarter 2011.

General and administrative expenses for the fourth quarter 2012 were $10.2
million, or 7.6% of revenue, compared to $7.4 million, or 8.7% of revenue in
the comparable period of last year. The 110 basis point improvement was driven
by leveraging fixed expenses on higher revenue, partially offset by additional
expenses associated with the acquisition of the distribution channels in the
Nordics in the first quarter 2012 and the acquisition of the Company's
distribution channels in Canada in the third quarter 2012. The fourth quarter
2012 also included additional share-based compensation expense associated with
the adoption of a new long-term incentive plan for the Company's Chief
Executive Officer.

Operating income increased to $7.9 million, or 5.9% of revenue as compared to
$5.3 million, or 6.2% of revenue in the fourth quarter 2011.

Tax expense was $78,000 representing a 1.0% effective tax rate compared to
$306,000 or a 5.4% effective tax rate in the fourth quarter 2011. This
reduction in effective tax rate is primarily attributable to additional
utilization of taxable expenses in one of our jurisdictions following an
agreement with the tax authority secured late in the quarter.

Balance Sheet Review

  oCash and cash equivalents and bank deposits at December 31, 2012 were
    $62.1 million compared to $74.3 million at December 31, 2011. The decrease
    is primarily attributable to the acquisition of the Nordics and Canadian
    distribution activities, debt repayment and an increase in working
    capital.
  oThe Company had no outstanding loans and borrowings at December 31, 2012
    compared to $4.0 million at December 31, 2011.
  oWorking capital at December 31, 2012 increased 21.5% to $95.1 million
    compared to $78.3 million at December 31, 2011.
  oInventories at December 31, 2012 increased 47.1% to $112.7 million
    compared to $76.6 million at December 31, 2011, primarily reflecting the
    additional inventory associated with the acquisition of the Nordics and
    Canadian inventory and the Company's business growth.

Change in Reporting Currency

Beginning with the quarter ended March 31, 2012, the Company changed its
reporting currency to the U.S. dollar (USD). Previously, the Company
presented its annual and quarterly consolidated balance sheets and related
consolidated statements of operations and cash flows in Euro (EUR). In
accordance with IFRS, the financial statements for comparative periods were
translated into the new reporting currency using the EUR to USD exchange rate
at January 1, 2012 of EUR 1.00 = USD 1.2973.

Full Year 2013 Guidance

  oThe Company expects full year 2013 revenue to increase approximately 25%
    over 2012 revenue of $436.3 million.
  oThe Company expects full year 2013 Adjusted EBITDA to increase
    approximately 34% over 2012 Adjusted EBITDA of $61.1 million.
  oThe Company expects full year 2013 net income on an Adjusted basis, which
    excludes share-based compensation expense, to increase approximately 25%
    over the Adjusted net income of $50.0 million reported in 2012.
  oThe Company expects full year 2013 net income to increase approximately
    18% as compared with its net income of $43.9 million in 2012. 2013
    guidance includes:

       oAn effective tax rate of approximately 10% compared with an effective
         tax rate of 1.7% in 2012.
       oShare-based compensation expense of approximately $11.0 million
         compared to share-based compensation expense of $6.2 million in 2012.
         The increase is primarily related to the recent adoption of the
         Company's long-term incentive plan.

Conference Call and Management Commentary

Detailed CFO commentary and a supplemental slide presentation have been filed
as part of today's 6-K and will be posted on the Company's website,
http://sodastream.investorroom.com.

The Company has scheduled a conference call for 8:30 AM Eastern Standard Time
(U.S. time) today (Wednesday, February 20, 2013) 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 manufactures beverage carbonation systems which enable consumers to
easily transform ordinary tap water instantly into carbonated soft drinks and
sparkling water. Soda makers offer a highly differentiated and innovative
solution to consumers of bottled and canned carbonated soft drinks and
sparkling water. Our products are environmentally friendly, cost effective,
promote health and wellness, and are customizable and fun to use. In addition,
our products offer convenience by eliminating the need to carry bottles home
from the supermarket, to store bottles at home or to regularly dispose of
empty bottles. Our products are available at more than 60,000 retail stores in
45 countries around the world. For more information on SodaStream, please
visit the Company's website: www.sodastream.com.

To download SodaStream's investor relations app, which offers access to SEC
documents, press releases, videos, audiocasts and more, please visit
http://itunes.apple.com/us/app/soda-ir/id524423001?mt=8 for your iPhone/iPad,
or https://play.google.com/store/apps/details?id=com.theirapp.soda for your
Android mobile device.

Non-IFRS Financial Measures

This press release contains certain non-IFRS measures, including Adjusted net
income, Adjusted Earnings Before Interest, Income Tax, Depreciation and
Amortization ("Adjusted EBITDA"), and Adjusted diluted earnings per share
("Adjusted diluted EPS").

Adjusted net income represents net income calculated in accordance with IFRS
as adjusted for the impact of the share-based compensation expense. Adjusted
EBITDA represents earnings before interest, income tax, depreciation and
amortization, and further eliminates the effect of the share-based
compensation expense. Adjusted diluted EPS represents earnings per share
calculated in accordance with IFRS as adjusted for the impact of the
share-based compensation expense.

The Company believes that the Adjusted net income, Adjusted EBITDA and
Adjusted diluted EPS, which exclude share-based compensation expense, should
be considered in evaluating the Company's operations. Adjusted net income and
Adjusted diluted EPS exclude share-based compensation because it 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
interest expenses, net), tax positions (such as the impact on periods or
companies of changes in effective tax rates) and the age and book depreciation
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, but 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 in the tables below.

Forward Looking Statements

This release contains forward-looking statements, which express the current
beliefs and expectations of management. 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 expand into our target
markets, including the United States; our ability to continue to develop or
maintain 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; 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 detailed in documents we file from time to time with the United
States Securities and Exchange Commission. Forward-looking statements in this
release are made pursuant to the safe harbor provisions contained in the
Private Securities Litigation Reform Act of 1995.

Consolidated Statements of Operations
In thousands (other than per share amounts)
                       For the twelve months ended  For the three months ended
                       December 31,                 December 31,
                       2011          2012           2011           2012
                       (Audited)     (Unaudited)    (Unaudited)
Revenue                $  288,953    $   436,316    $   85,688     $  132,947
Cost of revenue           131,405        200,491        36,549        62,439
Gross profit              157,548        235,825        49,139        70,508
Operating expenses
Sales and marketing       99,170         153,009        36,432        52,833
General and               29,829         37,767         7,422         10,160
administrative
Other income, net         (158)          (484)          (38)          (350)
Total operating           128,841        190,292        43,816        62,643
expenses
Operating income          28,707         45,533         5,323         7,865
Interest expense          (1,526)        169            (326)         129
(income), net
Other financial           (625)          767            22            125
expense (income), net
Total financial           (2,151)        936            (304)         254
expense (income), net
Income before income      30,858         44,597         5,627         7,611
taxes
Income tax expense        3,373          737            306           78
Net income for the     $  27,485     $   43,860     $   5,321      $  7,533
period
Net income per share
Basic                  $  1.40       $   2.16       $   0.26       $  0.37
Diluted                $  1.34       $   2.09       $   0.26       $  0.36
Weighted average
number of shares
Basic                     19,553         20,344         20,081        20,530
Diluted                   20,572         20,968         20,826        21,047



Consolidated Balance Sheets as of
                                           December 31,  December 31,
                                           2011          2012
                                           (Audited)     (Unaudited)
                                           (In thousands)
Assets
Cash and cash equivalents                  $   34,769    $   62,068
Bank deposits                                  39,485        -
Inventories                                    76,625        112,679
Trade receivables                              58,452        86,650
Other receivables                              20,064        28,021
Derivative financial instruments               322           803
Assets classified as available-for-sale        837           868
Total current assets                           230,554       291,089
Property, plant and equipment                  46,434        76,906
Intangible assets                              25,358        41,978
Deferred tax assets                            1,168         2,133
Other receivables                              224           271
Total non-current assets                       73,184        121,288
Total assets                                   303,738       412,377
Liabilities
Loans and borrowings                           4,006         -
Derivative financial instruments               -             261
Trade payables                                 47,383        86,431
Income tax payable                             9,171         8,866
Provisions                                     397           1,304
Other current liabilities                      21,071        37,022
Total current liabilities                      82,028        133,884
Employee benefits                              1,497         1,939
Provisions                                     514           537
Deferred tax liabilities                       717           1,527
Total non-current liabilities                  2,728         4,003
Total liabilities                              84,756        137,887
Shareholders' equity
Share capital                                  3,238         3,330
Share premium                                  168,601       178,338
Translation reserve                            1,471         3,628
Retained earnings                              45,672        89,194
Total shareholders' equity                     218,982       274,490
Total liabilities and shareholders' equity $   303,738   $   412,377



Consolidated Statements of Cash Flows
                       For the twelve months ended  For the threemonths ended
                       December 31,                 December 31,
                       2011           2012          2011           2012
                       (Audited)      (Unaudited)   (Unaudited)
                          (In thousands)
Cash flows from
operating activities
Net income for the     $  27,485      $   43,860    $  5,321       $  7,533
period
Adjustments:
Amortization of           937             1,602        459            495
intangible assets
Change in fair value
of derivative            392             504          (74)           -
financial instruments
Depreciation of
property, plant and      5,013           8,522        1,885          2,493
equipment
Gain on sales of
property, plant and       -               (766)        -              (766)
equipment
Share based payment       5,389           6,189        1,349          1,896
Interest expense          (1,526)         169          (326)          129
(income), net
Income tax expense        3,373           737          306            78
                          41,063          60,817       8,920          11,858
Increase in               (25,552)        (26,844)     (5,471)        (2,935)
inventories
Increase in trade and     (22,705)        (49,431)     (3,657)        (11,447)
other receivables
Increase (decrease) in    4,291           39,957       (1,799)        16,369
trade payables
Increase in employee      131             91           145            119
benefits
Increase (decrease) in
provisions and other      (811)           14,891       (895)          9,067
current liabilities
                          (3,583)         39,481       (2,757)        23,031
Interest paid             (422)           (454)        (149)          (120)
Income tax received       -               2,191        -              458
Income tax paid           (4,182)         (4,041)      (1,173)        (994)
Net cash from (used
in) operating             (8,187)         37,177       (4,079)        22,375
activities
Cash flows from
investing activities
Interest received         1,261           1,303        258            122
Investment in bank        (90,811)        (20,000)     (38,919)       -
deposits
Proceeds from bank        51,892          58,919       51,892         20,000
deposits
Payments for
derivative financial     (156)           (724)        (112)          (731)
instruments, net
Acquisition of
subsidiary, net of        (1,025)         (10,954)     (1,025)        -
cash acquired
Acquisition of
property, plant and      (18,690)        (34,080)     (4,624)        (10,321)
equipment
Acquisition of            (1,029)         (3,692)      (379)          (1,567)
intangible assets
Net cash from (used
in) investing            (58,558)        (9,228)      7,091          7,503
activities
Cash flows from
financing activities
Share issuance            42,929          -            -              -
Proceeds from exercise
of employee share         1,117           2,890        218            1,272
options
Change in short-term      (11,172)        (3,873)      (2,563)        -
debt
Net cash from (used
in) financing             32,874          (983)        (2,345)        1,272
activities
Net increase
(decrease) in cash and    (33,871)        26,966       667            31,150
cash equivalents
Cash and cash
equivalents at the        68,627          34,769       33,933         30,676
beginning of the
period
Effect of exchange
rates fluctuations on    13              333          169            242
cash and cash
equivalents
Cash and cash
equivalents at the    $  34,769      $   62,068    $  34,769      $  62,068
end of the period



Information about revenue in reportable segments
                                                            Central
                                                            and
                                                            Eastern

                         The Americas  Western Asia-Pacific Europe,  Total
                                       Europe
                                                            Middle

                                                            East,
                                                            Africa
                         (In thousands)
Twelve months ended:
December 31, 2011        $   83,894    153,174 21,010       30,875   $ 288,953
(Audited)
December 31, 2012        $   157,705   204,332 42,367       31,912   $ 436,316
(Unaudited)
Three months ended:
December 31, 2011        $   31,976    39,717  8,844        5,151    $ 85,688
(Unaudited)
December 31, 2012        $   62,762    51,996  11,591       6,598    $ 132,947
(Unaudited)



Reported (IFRS) to Adjusted (non-IFRS) Reconciliation of Consolidated Statements of
Operations
               Twelve months ended December 31,
               2011                                2012
               Reported      Share                 Reported      Share
                             based                               based
               (Unadjusted)  payment    Adjusted   (Unadjusted)  payment    Adjusted
               (Unaudited)
               In thousands (other than per share amounts)
Revenue        $   288,953   $ -        $ 288,953  $   436,316   $ -        $ 436,316
Cost of            131,405     -          131,405      200,491     -          200,491
revenue
Gross profit       157,548     -          157,548      235,825     -          235,825
Operating
expenses
Sales and          99,170      -          99,170       153,009     -          153,009
marketing
General and        29,829      (5,389)    24,440       37,767      (6,189)    31,578
administrative
Other income,      (158)       -          (158)        (484)       -          (484)
net
Total
operating          128,841     (5,389)    123,452      190,292     (6,189)    184,103
expenses
Operating          28,707      5,389      34,096       45,533      6,189      51,722
income
Interest
expense            (1,526)     -          (1,526)      169         -          169
(income), net
Other
financial          (625)       -          (625)        767         -          767
expense
(income), net
Total
financial          (2,151)     -          (2,151)      936         -          936
expense
(income), net
Income before      30,858      5,389      36,247       44,597      6,189      50,786
income taxes
Income tax         3,373       -          3,373        737         -          737
expense
Net income for $   27,485    $ 5,389    $ 32,874   $   43,860    $ 6,189    $ 50,049
the period
Net income per
share
Basic          $   1.40                 $ 1.69     $   2.16                 $ 2.46
Diluted        $   1.34                 $ 1.60     $   2.09                 $ 2.39
Weighted
average
number of
shares
Basic              19,553                 19,553       20,344                 20,344
Diluted            20,572                 20,572       20,968                 20,968



Reported (IFRS) to Adjusted (non-IFRS) Reconciliation of Consolidated Statements of
Operations
               Three months ended December 31,
               2011                               2012
               Reported      Share                Reported      Share
                             based                              based
               (Unadjusted)  payment    Adjusted  (Unadjusted)  payment    Adjusted
               (Unaudited)
               In thousands (other than per share amounts)
Revenue        $   85,688    $ -        $ 85,688  $   132,947   $ -        $ 132,947
Cost of            36,549      -          36,549      62,439      -          62,439
revenue
Gross profit       49,139      -          49,139      70,508      -          70,508
Operating
expenses
Sales and          36,432      -          36,432      52,833      -          52,833
marketing
General and        7,422       (1,349)    6,073       10,160      (1,896)    8,264
administrative
Other income,      (38)        -          (38)        (350)       -          (350)
net
Total
operating          43,816      (1,349)    42,467      62,643      (1,896)    60,747
expenses
Operating          5,323       1,349      6,672       7,865       1,896      9,761
income
Interest
expense            (326)       -          (326)       129         -          129
(income), net
Other
financial          22          -          22          125         -          125
expense, net
Total
financial          (304)       -          (304)       254         -          254
expense
(income), net
Income before      5,627       1,349      6,976       7,611       1,896      9,507
income taxes
Income tax         306         -          306         78          -          78
expense
Net income for $   5,321     $ 1,349    $ 6,670   $   7,533     $ 1,896    $ 9,429
the period
Net income per
share
Basic          $   0.26                 $ 0.34    $   0.37                 $ 0.46
Diluted        $   0.26                 $ 0.32    $   0.36                 $ 0.45
Weighted average number of shares
Basic              20,081                 20,081      20,530                 20,530
Diluted            20,826                 20,826      21,047                 21,047



EBITDA and Adjusted EBITDA
                                       Twelve months ended  Three months ended
                                       December 31,         December 31,
                                       2011       2012      2011      2012
                                       (Unaudited)
                                       (In thousands)
Reconciliation of Net Income to EBITDA
and Adjusted EBITDA
Net income                             $ 27,485   $ 43,860  $  5,321  $ 7,533
Interest expense (income), net           (1,526)    169        (326)    129
Income tax expense                       3,373      737        306      78
Depreciation and amortization            5,950      10,124     2,344    2,988
EBITDA                                   35,282     54,890     7,645    10,728
Share based payment                      5,389      6,189      1,349    1,896
Adjusted EBITDA                        $ 40,671   $ 61,079  $  8,994  $ 12,624



The following tables present the Company's revenue, by product type for the
periods presented, as well as such revenue by product type as a percentage of
total revenue:
               Twelve months ended                 Three months ended
               December 31,                        December 31,
               2011             2012               2011           2012
               (Audited)        (Unaudited)        (Unaudited)
               Revenue
               (in thousands)
Soda maker
starter kits
(including     $   125,595      $    185,875       $   40,683     $  66,075
exchange
cylinders)
Consumables        156,959           241,922           42,275        64,893
Other              6,399             8,519             2,730         1,979
Total          $   288,953      $    436,316       $   85,688     $  132,947



                                    Twelve months ended     Three months ended
                                    December 31,            December 31,
                                    2011       2012         2011       2012
                                    (Audited)  (Unaudited)  (Unaudited)
                                    As a percentage of revenue
Soda maker starter kits (including  43.5%      42.6%        47.5%      49.7%
exchange cylinders)
Consumables                         54.3%      55.4%        49.3%      48.8%
Other                               2.2%       2.0%         3.2%       1.5%
Total                               100.0%     100.0%       100.0%     100.0%





SOURCE SodaStream International Ltd.

Website: http://sodastream.investorroom.com
Contact: Yonah Lloyd, Chief Corporate Development and Communications Officer,
SodaStream International Ltd., +972-3-976-2462, yonahl@sodastream.com;
Investor Contacts (US): Brendon Frey, ICR, +1-203-682-8200,
brendon.frey@icrinc.com
 
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