FORM 6-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Report of Foreign Private Issuer
Pursuant to Rule 13a-16 or 15d-16 of
the Securities Exchange Act of 1934
For the month of January 2004
Commission File No. 000-27476
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Coolbrands International Inc.
(Translation of registrant's name into English)
8300 Woodbine Avenue, Markham, Ontario Canada L3R 9Y7
(Address of principal executive offices)
Indicate by check mark whether the registrant files or will file annual
reports under cover Form 20-F or Form 40-F.
Form 20-F [ ] Form 40-F [X]
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)________
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)________
Indicate by check mark whether the registrant by furnishing the information
contained in this Form is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes [ ] No [X]
If "Yes" is marked, indicate below the file number assigned to the
registrant in connection with Rule 12g3-2(b):82-_________
Materials relating to Registrant and filed pursuant to this Form 6-K
include a press release filed with SEDAR in Canada relating to the Registrant's
announcement of record increases in revenues for the first quarter of fiscal
2004.
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.
COOLBRANDS INTERNATIONAL INC.
Date: January 22, 2004 By: /s/ Aaron Serruya
------------------------------------
Name: Aaron Serruya
Title: Executive Vice President
NEWS FROM:
COOLBRANDS INTERNATIONAL, INC.
8300 Woodbine Avenue, 5th Floor Contact: Michael Serruya
Markham, Ontario, Canada, L3R 9Y7 Telephone: (905) 479-8762
FOR IMMEDIATE RELEASE: January 22, 2004
COOLBRANDS INTERNATIONAL INC. REPORTS
RECORD INCREASES IN REVENUES AND NET EARNINGS
FOR FIRST QUARTER OF FISCAL 2004
CoolBrands International Inc. (TSX: COB.A) announced today that revenues for the
first quarter of fiscal 2004 increased by 115.3% to $138,450,000 from
$64,299,000 for the same quarter last year. Net earnings for the quarter
increased by 178.8% to $7,591,000 ($0.14 basic and diluted earnings per share)
as compared with net earnings of $2,723,000 ($0.05 basic and diluted earnings
per share) for the same quarter last year
The growth in revenues for the first quarter of 2004 reflected increased sales
of prepackaged consumer products, including incremental sales from Americana
Foods, Eskimo Pie Frozen Distribution and from the Dreamery'r' and Whole
Fruit'TM' brands and the Godiva'r' brand license that were acquired in July 2003
and drayage income. Sales for the first quarter increased by 93.7% to
$122,121,000 as compared with $63,062,000 for the first quarter of 2003. Drayage
and other income increased to $15,365,000. Drayage income represents the fees
paid to CoolBrands by Dreyer's/Nestle to deliver products invoiced to customers
by Dreyer's/Nestle.
Gross profit dollars increased to $30,409,000 for the first quarter of fiscal
2004 from $23,499,000 for the same quarter last year, a 29.4% increase. Gross
profit percentage for first quarter of fiscal 2004 decreased to 24.9% as
compared to 37.3% for the first quarter of fiscal 2003, due to the impact of
lower margins generated by Americana Foods' manufacturing operations and Eskimo
Pie Frozen Distribution's distribution operations. Selling, general and
administrative expenses for first quarter of fiscal 2004 declined as a
percentage of revenues to 24.1% as compared to 30.8% for first quarter of fiscal
2003.
EBITDA for the first quarter increased to $14,525,000 from $6,222,000 during the
same quarter last year, an increase of $8,303,000, or 133.5%. Cash and short
term investments increased to $49,468,000 at November 30, 2003 from $30,140,000
at August 31, 2003. Working capital improved to $107,966,000 at November 30,
2003 from $85,734,000 at August 31, 2003. CoolBrands' current ratio improved to
2.6 to 1 at November 30, 2003 from 2.1 to 1 at August 31, 2003.
Commenting on the results, David J. Stein, President and Co-Chief Executive
Officer of CoolBrands International Inc. stated, "Our first quarter results
reflect the successful integration of the assets and businesses we acquired in
2003 and the ongoing growth of our base business. Our expanded portfolio of
brands, as well as our new distribution and manufacturing operations, all
contributed to the dramatic increase in the size and profitability of CoolBrands
during the quarter."
CoolBrands International Inc.
Consolidated Balance Sheets
as at November 30, and August 31, 2003
- --------------------------------------------------------------------------------
(in thousands of dollars)
November 30, August 31,
2003 2003
(Unaudited)
$ $
Assets
Current assets:
Cash and short term investments 49,468 30,140
Receivables 60,763 60,807
Receivables - affiliates 3,556 3,185
Inventories 53,298 55,604
Prepaid expenses 6,608 9,722
Future income taxes 2,684 1,930
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Total current assets 176,377 161,388
Future income taxes 4,230 2,977
Property, plant and equipment 26,798 28,349
License agreements 11,381 12,357
Intangible and other assets 8,529 9,084
Goodwill 95,492 99,695
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322,807 313,850
======= =======
Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable 19,824 27,339
Payables - affiliates 622 754
Accrued liabilities 39,115 33,530
Income taxes payable 1,703 5,204
Future income taxes 1,880 3,144
Current maturities of long-term debt 5,267 5,683
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Total current liabilities 68,411 75,654
Long-term debt 31,407 38,671
Other liabilities 3,635 3,984
Future income taxes 4,535 4,722
------- -------
Total liabilities 107,988 123,031
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Minority interest 14,614 2,968
------- -------
Shareholders' Equity:
Capital stock 138,103 122,406
Cumulative translation adjustment (19,838) (8,904)
Retained earnings 81,940 74,349
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Total shareholders' equity 200,205 187,851
------- -------
322,807 313,850
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<Page>
CoolBrands International Inc.
Consolidated Statements of Earnings
for the three months ended November 30, 2003 and 2002
- --------------------------------------------------------------------------------
(Unaudited)
(in thousands of dollars, except share data)
2003 2002
$ $
Revenues:
Sales 122,121 63,062
Franchising and licensing revenues:
Royalty income 597 696
Franchise and license fees 284 346
Consumer products license fee 83
Drayage and other income 15,365 195
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Total revenues 138,450 64,299
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Operating expenses:
Cost of goods sold 91,712 39,563
Selling, general and administrative expenses 33,385 19,796
Interest expense 577 548
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Total operating expenses 125,674 59,907
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Minority interest 288
------- ------
Earnings before income taxes 12,488 4,392
Provision for income taxes 4,897 1,669
------- ------
Net earnings 7,591 2,723
======= ======
Earnings per share:
Basic and diluted 0.14 0.05
======= ======
Weighted average shares outstanding:
Shares used in per share calculation - basic 54,413 51,714
Shares used in per share calculation - diluted 55,891 53,300
CoolBrands International Inc.
Consolidated Statements of Cash Flows
for the three months ended November 30, 2003 and 2002
- --------------------------------------------------------------------------------
(Unaudited)
(in thousands of dollars)
2003 2002
$ $
Cash and short term investments provided by (used in):
Operating activities:
Net earnings 7,591 2,723
Items not affecting cash:
Depreciation and amortization 1,460 1,282
Future income taxes (1,886) (1,176)
Minority interest 288
Changes in current assets and liabilities:
Receivables (322) 9,028
Receivables - affiliates (381) 1,199
Allowance for doubtful accounts 349 91
Inventories 2,371 (4,323)
Prepaid income taxes (215)
Prepaid expenses 3,197 2,648
Accounts payable (7,723) 1,207
Payables - affiliates (136) (127)
Accrued liabilities 5,880 (3,479)
Income taxes payable (3,596) (7,392)
Other assets (73) (1)
Other liabilities (359) 113
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Cash provided by operating activities 6,660 1,578
------ ------
Investing activities:
Increase in notes receivable (19)
Repayment of notes receivable 3 108
Purchase of leasehold improvements and equipment (3,005) (1,297)
------ ------
Cash used in investing activities (3,002) (1,208)
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Financing activities:
Expenses for special warrants (144)
Proceeds from issuance of Class A and B shares 15,697 28
Capital contributions from Partnership's minority partner 11,554
Repayment of long-term debt (5,000) (1,578)
------ ------
Cash provided by (used in) financing activities 22,251 (1,694)
------ ------
(Decrease) increase in cash flow due to changes in
foreign exchange rates (6,581) 189
------ ------
Increase (decrease) in cash and short term investments 19,328 (1,135)
Cash and short-term investments - beginning of period
30,140 47,086
------ ------
Cash and short-term investments - end of period 49,468 45,951
====== ======
CoolBrands International Inc.
Summary Financial Data
- --------------------------------------------------------------------------------
(in thousands of dollars, except share data):
For the Three Months Ended
November 30,
--------------------------
2003 2002
$ $
Revenues 138,450 64,299
Earnings before income taxes 12,488 4,392
Provision for income taxes 4,897 1,669
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Net earnings 7,591 2,723
======= ======
Basic and diluted earnings per share: .14 .05
EBITDA 14,525 6,222
Depreciation and amortization 1,460 1,282
Interest expense 577 548
Weighted average number of shares outstanding:
Shares used in per share calculation - basic 54,413 51,714
Shares used in per share calculation - diluted 55,891 53,300
About CoolBrands International Inc.:
CoolBrands International is a leader in the consumer products and franchising
segments of the frozen dessert industry, marketing a diverse range of frozen
dessert products under nationally and internationally recognized brand names.
CoolBrands is the pre-eminent company in the fast-growing "better-for-you" ice
cream category with offerings such as fat free, non-dairy Whole Fruit 'TM'
Sorbet, Weight Watchers'r' Smart Ones'r' low-fat and fat-free frozen desserts
and new Atkins'r' Endulge'TM' controlled carbohydrate super premium ice cream.
CoolBrands also competes in the super premium ice cream category with the
Dreamery'r' Ice Cream and Godiva'r' Ice Cream brands. In addition, CoolBrands
markets a wide variety of "all family" premium ice creams, frozen novelties and
frozen desserts under the Eskimo Pie'r', Chipwich'r', Tropicana'r', Welch's'r',
Yoplait'r', Betty Crocker'r' and Trix'r' brand names.
CoolBrands' subsidiary, Eskimo Pie Frozen Distribution, operates the second
largest "direct store delivery" (DSD) ice cream distribution system in the U.S.,
serving these CoolBrands products and a growing family of Partner Brands to
supermarkets, convenience stores and other retail customers.
CoolBrands' subsidiary, Americana Foods, is a leading U.S. manufacturer and
supplier of soft serve mixes, packaged ice cream, frozen yogurt and sorbet
products and frozen novelties to well known national retailers, food companies
and restaurant chains. Americana Foods also manufactures and sells products for
the foodservice channel, which are extensively used to standardize quality and
reduce labor costs in on-site food preparation.
Coolbrands' Foodservice Division manufactures and sells premium soft serve ice
cream and frozen yogurt to the foodservice industry. CoolBrands also
manufactures and sells a full line of quality flavours, chocolate coatings,
fudge sauces, powders for chocolate milk, egg nog bases and other ingredients
and flexible packaging products for use in private label dairy products in
addition to the Company's brands.
CoolBrands also franchises and licenses frozen dessert outlets operated under a
Family of Brands including Tropicana'r' Smoothies, Juices & More, Swensen's'r'
Ice Cream, I Can't Believe It's Yogurt'r', Yogen Fruz'r', Bresler's'r' Premium
Ice Cream, Golden Swirl'r' and Ice Cream Churn'r', with company-owned,
franchised and non-traditional partnership locations around the world.
This press release includes certain forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995 regarding, among
other things, statements relating to goals, plans and projections regarding the
Company's financial position and business strategy. These statements may be
identified by the fact that they use such words as "anticipate," "estimate,"
"expect," "intend," "plan," "believe," and other words and terms of similar
meaning in connection with any discussion of future operating or financial
performance. Such forward-looking statements are based on current expectations
and involve inherent risks and uncertainties, including factors that could
delay, divert or change any of them, and could cause actual outcomes and results
to differ materially from current expectations. These factors include, among
other things, market factors, competitive product development and promotional
activity, the level of consumer interest in the Company's products, product
costing, the weather, the performance of management, including management's
ability to implement its plans as contemplated, the Company's relationship with
its customers, franchisees, licensees and licensors, governmental regulations
and legislation and litigation. The Company undertakes no obligation to publicly
update any forward-looking statement, whether as a result of new information,
future events or otherwise.
STATEMENT OF DIFFERENCES
The trademark symbol shall be expressed as..................................'TM'
The registered trademark symbol shall be expressed as........................'r'