NATIONAL BEVERAGE CORP - Quarter Report: 2009 October (Form 10-Q)
Table of Contents
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended October 31, 2009
Commission file number 1-14170
NATIONAL BEVERAGE CORP.
(Exact name of registrant as specified in its charter)
![(NATIONAL BEVERAGE CORP. LOGO)](https://www.sec.gov/Archives/edgar/data/0000069891/000095012309069774/g21529g2152901.gif)
Delaware | 59-2605822 | |
(State of incorporation) | (I.R.S. Employer Identification No.) |
8100 SW Tenth Street, Suite 4000, Ft. Lauderdale, FL 33324
(Address of principal executive offices including zip code)
(Address of principal executive offices including zip code)
(954) 581-0922
(Registrants telephone number including area code)
(Registrants telephone number including area code)
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for
such shorter period that the Registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. Yes þ No o
Indicate by check mark whether the registrant has submitted electronically and posted on its
corporate Web site, if any, every Interactive Data File required to be submitted and posted
pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months
(or for such shorter period that the registrant was required to submit and post such files). Yes
o No o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a
non-accelerated filer, or a smaller reporting company. See the definitions of large accelerated
filer, accelerated filer, and smaller reporting company in Rule 12b-2 of the Exchange Act.
Large accelerated filer o | Accelerated filer þ | Non-accelerated filer o (Do not check if a smaller reporting company) | Smaller reporting company o |
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the
Exchange Act). Yes o No þ
The number of shares of registrants common stock outstanding as of December 4, 2009 was
46,049,564.
NATIONAL BEVERAGE CORP.
QUARTERLY REPORT ON FORM 10-Q
INDEX
QUARTERLY REPORT ON FORM 10-Q
INDEX
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PART I FINANCIAL INFORMATION
ITEM 1. | FINANCIAL STATEMENTS |
National Beverage Corp. and Subsidiaries
Condensed Consolidated Balance Sheets
(In thousands, except share amounts)
(Unaudited)
(In thousands, except share amounts)
(Unaudited)
October 31, | May 2, | |||||||
2009 | 2009 | |||||||
Assets |
||||||||
Current assets: |
||||||||
Cash and equivalents |
$ | 105,202 | $ | 84,140 | ||||
Trade receivables net of allowances of $459 ($445 at May 2, 2009) |
46,521 | 53,735 | ||||||
Inventories |
34,076 | 39,612 | ||||||
Deferred income taxes net |
3,198 | 3,262 | ||||||
Prepaid and other assets |
4,134 | 5,552 | ||||||
Total current assets |
193,131 | 186,301 | ||||||
Property net |
54,329 | 56,141 | ||||||
Goodwill |
13,145 | 13,145 | ||||||
Intangible assets net |
1,861 | 1,861 | ||||||
Other assets |
7,750 | 8,234 | ||||||
$ | 270,216 | $ | 265,682 | |||||
Liabilities and Shareholders Equity |
||||||||
Current liabilities: |
||||||||
Accounts payable |
$ | 31,733 | $ | 48,005 | ||||
Accrued liabilities |
22,481 | 20,142 | ||||||
Income taxes payable |
66 | 314 | ||||||
Total current liabilities |
54,280 | 68,461 | ||||||
Deferred income taxes net |
16,308 | 16,517 | ||||||
Other liabilities |
10,880 | 10,692 | ||||||
Shareholders equity: |
||||||||
Preferred stock, 7% cumulative, $1 par value - 1,000,000 shares
authorized; 150,000 shares issued; no shares outstanding |
150 | 150 | ||||||
Common stock, $.01 par value - 75,000,000 shares authorized;
50,074,188 shares issued (50,045,718 shares at May 2, 2009) |
501 | 500 | ||||||
Additional paid-in capital |
27,455 | 27,153 | ||||||
Retained earnings |
178,326 | 160,209 | ||||||
Accumulated other comprehensive income |
316 | | ||||||
Treasury stock at cost: |
||||||||
Preferred stock - 150,000 shares |
(5,100 | ) | (5,100 | ) | ||||
Common stock - 4,032,784 shares |
(12,900 | ) | (12,900 | ) | ||||
Total shareholders equity |
188,748 | 170,012 | ||||||
$ | 270,216 | $ | 265,682 | |||||
See accompanying Notes to Condensed Consolidated Financial Statements.
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National Beverage Corp. and Subsidiaries
Condensed Consolidated Statements of Income
(In thousands, except per share amounts)
(Unaudited)
(In thousands, except per share amounts)
(Unaudited)
Three Months Ended | Six Months Ended | |||||||||||||||
October 31, | November 1, | October 31, | November 1, | |||||||||||||
2009 | 2008 | 2009 | 2008 | |||||||||||||
Net sales |
$ | 149,571 | $ | 144,375 | $ | 312,402 | $ | 297,302 | ||||||||
Cost of sales |
98,774 | 101,866 | 211,082 | 208,729 | ||||||||||||
Gross profit |
50,797 | 42,509 | 101,320 | 88,573 | ||||||||||||
Selling, general and administrative
expenses |
37,520 | 32,929 | 72,834 | 67,075 | ||||||||||||
Interest expense |
27 | 31 | 57 | 55 | ||||||||||||
Other income (expense) net |
(325 | ) | 565 | (297 | ) | 763 | ||||||||||
Income before income taxes |
12,925 | 10,114 | 28,132 | 22,206 | ||||||||||||
Provision for income taxes |
4,601 | 3,631 | 10,015 | 7,972 | ||||||||||||
Net income |
$ | 8,324 | $ | 6,483 | $ | 18,117 | $ | 14,234 | ||||||||
Net income per share - |
||||||||||||||||
Basic |
$ | .18 | $ | .14 | $ | .39 | $ | .31 | ||||||||
Diluted |
$ | .18 | $ | .14 | $ | .39 | $ | .31 | ||||||||
Average common shares outstanding - |
||||||||||||||||
Basic |
46,020 | 46,002 | 46,017 | 45,992 | ||||||||||||
Diluted |
46,275 | 46,195 | 46,268 | 46,165 | ||||||||||||
See accompanying Notes to Condensed Consolidated Financial Statements.
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National Beverage Corp. and Subsidiaries
Condensed Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
(In thousands)
(Unaudited)
Six Months Ended | ||||||||
October 31, | November 1, | |||||||
2009 | 2008 | |||||||
Operating Activities: |
||||||||
Net income |
$ | 18,117 | $ | 14,234 | ||||
Adjustments to reconcile net income to net cash
provided by operating activities: |
||||||||
Depreciation and amortization |
6,377 | 6,065 | ||||||
Deferred income tax (benefit) provision |
(320 | ) | 149 | |||||
Loss on disposal of property, net |
193 | 74 | ||||||
Impairment loss on long-lived assets |
500 | | ||||||
Stock-based compensation |
171 | 172 | ||||||
Changes in assets and liabilities: |
||||||||
Trade receivables |
7,214 | 1,571 | ||||||
Inventories |
5,536 | (3,590 | ) | |||||
Prepaid and other assets |
1,656 | 1,554 | ||||||
Accounts payable |
(16,272 | ) | (7,356 | ) | ||||
Accrued and other liabilities |
2,057 | (750 | ) | |||||
Net cash provided by operating activities |
25,229 | 12,123 | ||||||
Investing Activities: |
||||||||
Marketable securities purchased |
| (73,250 | ) | |||||
Marketable securities sold |
| 76,250 | ||||||
Additions to property, plant and equipment |
(4,309 | ) | (2,753 | ) | ||||
Proceeds from sale of property, plant and equipment |
10 | 55 | ||||||
Net cash (used in) provided by investing activities |
(4,299 | ) | 302 | |||||
Financing Activities: |
||||||||
Proceeds from stock options exercised |
67 | 212 | ||||||
Stock-based tax benefits |
65 | 46 | ||||||
Net cash provided by financing activities |
132 | 258 | ||||||
Net Increase in Cash and Equivalents |
21,062 | 12,683 | ||||||
Cash and Equivalents Beginning of Year |
84,140 | 51,497 | ||||||
Cash and Equivalents End of Period |
$ | 105,202 | $ | 64,180 | ||||
Other Cash Flow Information: |
||||||||
Interest paid |
$ | 61 | $ | 51 | ||||
Income taxes paid |
10,497 | 6,170 |
See accompanying Notes to Condensed Consolidated Financial Statements.
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National Beverage Corp. and Subsidiaries
Notes to Condensed Consolidated Financial Statements
(Unaudited)
(Unaudited)
1. SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
National Beverage Corp. develops, manufactures, markets and distributes a complete portfolio of
multi-flavored soft drinks, juice drinks, water and specialty beverages throughout the United
States. Incorporated in Delaware in 1985, National Beverage Corp. is a holding company for various
operating subsidiaries. When used in this report, the terms we, us, our, Company and
National Beverage mean National Beverage Corp. and its subsidiaries.
The accompanying unaudited condensed consolidated financial statements have been prepared in
accordance with accounting principles generally accepted in the United States (GAAP) and rules
and regulations of the Securities and Exchange Commission for interim financial information. The
financial statements do not include all information and notes required by GAAP for complete
financial statements. In our opinion, all adjustments (consisting of normal recurring adjustments)
considered necessary for a fair presentation have been included. Results for the interim periods
presented are not necessarily indicative of results which might be expected for the entire fiscal
year.
These interim financial statements should be read in conjunction with the audited consolidated
financial statements and notes thereto included in the Companys Annual Report on Form 10-K for the
fiscal year ended May 2, 2009. In preparing these interim financial statements, we have reviewed
and considered for disclosure all significant events occurring through December 10, 2009, the date
of financial statement issuance.
Derivative Financial Instruments
We use derivative financial instruments to partially mitigate our exposure to changes in raw
material costs. All derivative financial instruments are recorded at fair value in our Condensed
Consolidated Balance Sheets. The estimated fair value of derivative financial instruments is
calculated based on market rates to settle the instrument. Such valuation does not entail
significant amount of judgment and the inputs that are significant to the fair value measurement
are Level 2 in the fair value hierarchy. We do not use derivative financial instruments for
trading or speculative purposes. See Note 6.
2. INVENTORIES
Inventories are stated at the lower of first-in, first-out cost or market. Inventories at October
31, 2009 are comprised of finished goods of $19,469,000 and raw materials of $14,607,000.
Inventories at May 2, 2009 are comprised of finished goods of $22,168,000 and raw materials of
$17,444,000.
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3. PROPERTY
Property consists of the following:
(In thousands) | ||||||||
October 31, | May 2, | |||||||
2009 | 2009 | |||||||
Land |
$ | 9,779 | $ | 9,779 | ||||
Buildings and improvements |
43,851 | 44,224 | ||||||
Machinery and equipment |
126,770 | 123,911 | ||||||
Total |
180,400 | 177,914 | ||||||
Less accumulated depreciation |
(126,071 | ) | (121,773 | ) | ||||
Property net |
$ | 54,329 | $ | 56,141 | ||||
Depreciation expense was $2,930,000 and $5,418,000 for the three-month and six-month periods ended
October 31, 2009, respectively, and $2,534,000 and $4,985,000 for the three-month and six-month
periods ended November 1, 2008, respectively.
Included in Selling, general and administrative expenses for the second quarter ended October 31,
2009 is a $500,000 impairment loss related to an owned warehouse.
4. DEBT
At October 31, 2009, a subsidiary of the Company maintained unsecured revolving credit facilities
with banks aggregating $75 million (the Credit Facilities). The Credit Facilities expire through
December 2013 and currently bear interest at rates ranging from .3% to .6% above LIBOR or, at our
election, .5% below the banks reference rates. At October 31, 2009, $2.8 million of the Credit
Facilities was used for standby letters of credit and $72.2 million was available for borrowings.
The Credit Facilities require the subsidiary to maintain certain financial ratios and contain other
restrictions, none of which are expected to have a material impact on our operations or financial
position. Significant financial ratios and restrictions include: fixed charge coverage; net worth
ratio; and limitations on incurrence of debt. At October 31, 2009, we were in compliance with all
loan covenants and approximately $25 million of retained earnings were restricted from
distribution.
5. STOCK-BASED COMPENSATION
During the six months ended October 31, 2009, options to purchase 3,000 shares were granted
(weighted average exercise price of $6.05), options to purchase 28,470 shares were exercised
(weighted average exercise price of $2.36), and options to purchase 1,201 shares were cancelled
(weighted average exercise price of $6.21). At October 31, 2009, options to purchase 568,612
shares (weighted average exercise price of $3.94) were outstanding and stock-based awards to
purchase 3,242,243 shares of common stock were available for grant.
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6. DERIVATIVE FINANCIAL INSTRUMENTS
In June 2009, we entered into an aluminum swap contract to partially mitigate our exposure to
changes in the cost of aluminum cans through April 2010. The financial instrument was designated
and accounted for as a cash flow hedge. Accordingly, gains or losses attributable to the effective
portion of the cash flow hedge are reported in Other Comprehensive Income (OCI) and reclassified
into earnings, through cost of sales, in the period in which the hedged transaction affects
earnings. Any gains or losses related to hedge ineffectiveness are recognized in the current
period cost of sales. As of October 31, 2009, the notional amount of our outstanding aluminum swap
contract was $3.8 million and the fair value of the derivative asset was $491,000, which was
included in Prepaid and Other Assets. The following summarizes the gains (losses) recognized in
the Condensed Consolidated Statements of Income and OCI relative to the cash flow hedge for the
second quarter and six months ended October 31, 2009.
In thousands | ||||||||
Second | Six | |||||||
Quarter | Months | |||||||
Recognized in OCI- |
||||||||
Gain (loss) before income taxes |
$ | (1 | ) | $ | 597 | |||
Less income tax provision |
| 213 | ||||||
Net |
$ | (1 | ) | $ | 384 | |||
Reclassified from OCI to cost of sales- |
||||||||
Gain before income taxes |
$ | 145 | $ | 106 | ||||
Less income tax provision |
52 | 38 | ||||||
Net |
$ | 93 | $ | 68 | ||||
Net change to OCI |
$ | (94 | ) | $ | 316 | |||
The ineffective portion of the change in fair value of our cash flow hedge was immaterial.
Assuming no change in the commodity prices as measured on October 31, 2009, $316,000 of unrealized
net gain will be reclassified from OCI and recognized in earnings over the next seven months. See
Notes 1 and 7.
7. COMPREHENSIVE INCOME
Comprehensive income for the second quarter and six months ended October 31, 2009 and November 1,
2008 is comprised of net income and changes in the fair value of our cash flow hedge (see Note 6
above) as follows:
In thousands | ||||||||||||||||
Second Quarter Ended | Six Months Ended | |||||||||||||||
2009 | 2008 | 2009 | 2008 | |||||||||||||
Net income |
$ | 8,324 | $ | 6,483 | $ | 18,117 | $ | 14,234 | ||||||||
Cash flow hedge, net of tax |
(94 | ) | | 316 | | |||||||||||
Comprehensive income |
$ | 8,230 | $ | 6,483 | $ | 18,433 | $ | 14,234 | ||||||||
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8. NEW ACCOUNTING STANDARDS
In September 2006, the Financial Accounting Standards Board (FASB) issued new guidance on fair
value measurements. The guidance defines fair value, provides a framework for measuring fair value
and expands disclosures about fair value measurements. The guidance was effective at the beginning
of our 2009 fiscal year for all financial assets and liabilities and for nonfinancial assets and
liabilities measured at fair value on a recurring basis. For all other nonfinancial assets and
liabilities, the guidance was effective at the beginning of our 2010 fiscal year. The adoption of
this guidance did not have a material impact on our consolidated financial statements.
In December 2007, the FASB issued new guidance to improve, simplify, and converge internationally
the accounting for business combinations and the reporting of noncontrolling interests in
consolidated financial statements. The guidance was effective as of the beginning of our 2010
fiscal year and its adoption did not have a material impact on our consolidated financial
statements.
In May 2009, the FASB issued new guidance on subsequent events that establishes general standards
of accounting for and disclosure of events that occur after the balance sheet date but before
financial statements are issued. We adopted the guidance effective August 1, 2009.
In June 2009, the FASB issued the FASB Accounting Standards Codification and the Hierarchy of
Generally Accepted Accounting Principles (the Codification) which authorized the Codification as
the sole source for authoritative U.S. GAAP. Any accounting literature that is not in the
Codification will be considered non-authoritative. We began utilizing the Codification as our sole
source of authoritative U.S. GAAP effective for our second quarter ended October 31, 2009.
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ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
OVERVIEW
National Beverage Corp. develops, manufactures, markets and distributes a complete portfolio of
quality beverage products throughout the United States. Incorporated in Delaware in 1985, National
Beverage Corp. is a holding company for various operating subsidiaries. In this report, the terms
we, us, our, Company and National Beverage mean National Beverage Corp. and its
subsidiaries.
We consider ourselves to be a leader in the development and sale of flavored beverage products in
the United States, offering the widest selection of flavored soft drinks, juices, sparkling waters,
energy drinks and nutritionally-enhanced waters. Our flavor development spans over 100 years
originating with our flagship brands, Shasta® and Faygo®, each of which has over 50 flavor
varieties. We also maintain a diverse line of flavored beverage products geared to the
health-conscious consumer, including Everfresh®, Home Juice®, and Mr. Pure® 100% juice and
juice-based products; LaCroix®, Crystal Bay® and ClearFruit® flavored, sparkling, and spring water
products; and ÀSanté® nutritionally-enhanced waters. In addition, we distribute Rip It® energy
drinks, Ohana® fruit-flavored drinks, St. Nicks® holiday soft drinks as well as powder and
effervescent tablet beverage enhancers sold under the NutraFizz® brand name. Substantially all of
our brands are produced in twelve manufacturing facilities that are strategically located in major
metropolitan markets throughout the continental United States. To a lesser extent, we develop and
produce soft drinks for certain retailers and beverage companies (allied brands).
Our strategy emphasizes the growth of our products by offering a branded beverage portfolio of
proprietary flavors; by supporting the franchise value of regional brands and expanding those
brands with distinctive packaging and broader demographic emphasis; by developing and acquiring
innovative products tailored toward healthy lifestyles; and by appealing to the quality-price
expectations of the family consumer. We believe that the regional share dynamics of our brands
perpetuate consumer loyalty within local regional markets, resulting in more retailer sponsored
promotional activities.
Over the last several years, we have focused on increasing penetration of our brands in the
convenience channel through Company-owned and independent distributors. The convenience channel
consists of convenience stores, gas stations, and other smaller up-and-down-the-street accounts.
Because of the higher retail prices and margins that typically prevail, we have undertaken several
measures to expand convenience channel distribution in recent years. These include development of
products specifically targeted to this market, such as ClearFruit, Crystal Bay, Rip It and ÀSanté.
Additionally, we have created proprietary and specialized packaging with distinctive graphics for
these products. We intend to continue our focus on enhancing growth in the convenience channel
through both specialized packaging and innovative product development.
Beverage industry sales are seasonal with the highest volume typically realized during the summer
months. Additionally, our operating results are subject to numerous factors, including
fluctuations in the costs of raw materials, changes in consumer preference for beverage products
and competitive pricing in the marketplace.
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RESULTS OF OPERATIONS
Three Months Ended October 31, 2009 (second quarter of fiscal 2010) compared to
Three Months Ended November 1, 2008 (second quarter of fiscal 2009)
Three Months Ended November 1, 2008 (second quarter of fiscal 2009)
Net sales for the second quarter of fiscal 2010 increased 3.6% to $149.6 million compared to $144.4
million for the second quarter of fiscal 2009. The net sales improvement reflects a 3.1% increase
in unit pricing due primarily to product mix and a 1.8% increase in branded case volume. The sales
improvement was partially offset by lower allied-branded case volume.
Gross profit approximated 34.0% of net sales for the second quarter of fiscal 2010 compared to
29.4% of net sales for the second quarter of fiscal 2009. The gross profit improvement was due
primarily to higher sales volume and lower raw material costs. Cost of goods sold per unit
decreased 3.5%.
Selling, general and administrative expenses were $37.5 million or 25.1% of net sales for the
second quarter of fiscal 2010 compared to $32.9 million or 22.8% of net sales for the second
quarter of fiscal 2009. The increase in expenses is due to higher marketing and administrative
expenses.
Other income includes interest income of $55,000 (fiscal 2010) and $247,000 (fiscal 2009). Also,
included in other income for the second quarter of fiscal 2010 is a loss of $96,000 from the
disposal of property, plant and equipment and $250,000 from the write-off of other assets.
The Companys effective rate for income taxes, based upon estimated annual income tax rates,
approximated 35.6% of income before taxes for the second quarter of fiscal 2010 and 35.9% for the
comparable period in fiscal 2009. The difference between the effective rate and the federal
statutory rate of 35% was primarily due to the effects of state income taxes, nondeductible
expenses and nontaxable interest income.
Net income was $8.3 million for the second quarter of fiscal 2010 compared to $6.5 million for the
second quarter of fiscal 2009.
Six Months Ended October 31, 2009 (first six months of fiscal 2010) compared to
Six Months Ended November 1, 2008 (first six months of fiscal 2009)
Six Months Ended November 1, 2008 (first six months of fiscal 2009)
Net sales for the first six months of fiscal 2010 increased 5.1% to $312.4 million compared to
$297.3 million for the first six months of fiscal 2009. The net sales increase reflects case
volume growth of 1.5% for the Companys energy drinks, juices and waters and 9.3% for branded
carbonated soft drinks. This improvement was partially offset by lower allied-branded volume.
Gross profit approximated 32.4% of net sales for the first six months of fiscal 2010 compared to
29.8% of net sales for the first six months of fiscal 2009. The gross profit improvement was due
primarily to higher sales volume and lower raw material costs. Cost of goods sold per unit
decreased 3.1%.
Selling, general and administrative expenses were $72.8 million or 23.3% of net sales for the first
six months of fiscal 2010 compared to $67.1 million or 22.6% of net sales for the
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comparable period in fiscal 2009. The increase in expenses is due to higher marketing and administrative
expenses.
Other income (expense) includes interest income of $154,000 (fiscal 2010) and $449,000 (fiscal
2009). Also, included in other income (expense) for the first six months of fiscal 2010 is a loss
of $193,000 from the disposal of property, plant and equipment and $250,000 from the write-off of
other assets.
The Companys effective rate for income taxes, based upon estimated annual income tax rates,
approximated 35.6% of income before taxes for the first six months of fiscal 2010 and 35.9% for the
comparable period in fiscal 2009. The difference between the effective rate and the federal
statutory rate of 35% was primarily due to the effects of state income taxes, nondeductible
expenses and nontaxable interest income.
Net income was $18.1 million for the first six months of fiscal 2010 compared to $14.2 million for
the first six months of fiscal 2009.
LIQUIDITY AND FINANCIAL CONDITION
Liquidity and Capital Resources
Our principal source of funds is cash generated from operations, which may be supplemented by
borrowings under existing credit facilities. We maintain unsecured revolving credit facilities
aggregating $75 million, of which $2.8 million was used for standby letters of credit at October
31, 2009. There was no debt outstanding under the credit facilities. We believe that our capital
resources, including cash and equivalents aggregating $105.2 million as of October 31, 2009, are
sufficient to fund our capital requirements for the foreseeable future.
Cash Flows
During the first six months of fiscal 2010, $25.2 million was provided by operating activities
while $4.3 million was used in investing activities. Cash provided by operating activities
increased $13.1 million due primarily to an improvement in earnings and working capital
requirements. Cash used in investing activities increased $4.6 million due primarily to changes in
net marketable securities and additions to property, plant and equipment.
Financial Position
During the first six months of fiscal 2010, working capital increased $21.0 million to $138.9
million due primarily to cash provided by operating activities. Trade receivables, inventory and
accounts payable decreased due to lower volume related to seasonality. Prepaid and other assets
decreased due to a decline in income tax refund receivables. The current ratio was 3.6 to 1 at
October 31, 2009 and 2.7 to 1 at May 2, 2009.
NEW ACCOUNTING STANDARDS
See Note 8 of Notes to Condensed Consolidated Financial Statements for information about recently
issued accounting standards.
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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
There are no material changes to the disclosures made on this matter in the Companys Annual Report
on Form 10-K for the fiscal year ended May 2, 2009.
ITEM 4. CONTROLS AND PROCEDURES
As of the end of the period covered by this report, we carried out an evaluation, under the
supervision and with the participation of the Companys management, including our Chief Executive
Officer and Principal Financial Officer, of the effectiveness of the design and operation of our
disclosure controls and procedures (as defined in Rule 13a-15(e) of the Exchange Act). Based
upon that evaluation, the Chief Executive Officer and Principal Financial Officer concluded that
our disclosure controls and procedures were effective to ensure information required to be
disclosed by us in reports we file or submit under the Exchange Act is (1) recorded, processed,
summarized and reported within the time periods specified in SEC rules and (2) accumulated and
communicated to our management, including our Chief Executive Officer and Principal Financial
Officer, to allow timely decisions regarding required disclosure.
There were no changes in our internal control over financial reporting during our most recent
fiscal quarter that have materially affected, or are reasonably likely to materially affect, our
internal control over financial reporting.
FORWARD-LOOKING STATEMENTS
Certain statements in this Quarterly Report on Form 10-Q (this Form 10-Q) constitute
forward-looking statements within the meaning of the Private Securities Litigation Reform Act of
1995. Such forward-looking statements involve known and unknown risks, uncertainties and other
factors which may cause the actual results, performance or achievements of the Company to be
materially different from any future results, performance or achievements expressed or implied by
such forward-looking statements. Such factors include, but are not limited to, the following:
general economic and business conditions; pricing of competitive products; success in acquiring
other beverage businesses; success of new product and flavor introductions; fluctuations in the
costs of raw materials; our ability to increase prices; continued retailer support for our
products; changes in consumer preferences; success of implementing business strategies; changes in
business strategy or development plans; government regulations; regional weather conditions; and
other factors referenced in this Form 10-Q. For a further list and description of various risks,
relevant factors and uncertainties that could cause future results or events to differ materially
from those expressed or implied in our forward-looking statements, see the Risk Factors and
Managements Discussion and Analysis of Financial Condition and Results of Operations sections
contained in our Annual Report on Form 10-K for the fiscal year ended May 2, 2009 and other filings
with the Securities and Exchange Commission. We disclaim an obligation to update any such factors
or to publicly announce the results of any revisions to any forward-looking statements contained
herein to reflect future events or developments.
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PART II OTHER INFORMATION
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
At the Companys Annual Meeting of Shareholders held October 2, 2009, Mr. Samuel C. Hathorn, Jr.
and Mr. Joseph G. Caporella were re-elected to the Board of Directors for a three-year term. Of
the 44,705,802 shares voted, 44,198,543 shares were voted for the election of Mr. Samuel C.
Hathorn, Jr. (507,259 shares were withheld) and 41,308,925 shares were voted for the election of
Mr. Joseph G. Caporella (3,396,877 shares were withheld).
ITEM 6. EXHIBITS
Exhibit No. | Description | |
31.1 |
Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | |
31.2 |
Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | |
32.1 |
Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | |
32.2 |
Certification of Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |
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SIGNATURE
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.
Date: December 10, 2009
National Beverage Corp. (Registrant) |
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By: | /s/ Dean A. McCoy | |||
Dean A. McCoy | ||||
Senior Vice President and Chief Accounting Officer |
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