Gross profit for the third quarter of 2012 increased 33.4% to $55.3 million from $41.5 million in the third quarter of 2011. Gross profit expressed as a percentage of net sales increased 4.7 percentage points to 35.9% for the third quarter of 2012 from 31.2% in the third quarter of 2011. The increase in gross profit expressed as a percentage of net sales was primarily attributable to pricing gains of $3.5 million and a sales mix shift to higher margin products (primarily due to the Culver Specialty Brands acquisition), partially offset by commodity cost increases. Operating income increased 41.5% to $38.3 million for the third quarter of 2012, from $27.1 million in the third quarter of 2011.
Net interest expense for the third quarter of 2012 increased $3.7 million or 44.1% to $12.0 million from $8.3 million for the third quarter of 2011. The increase in net interest expense for the third quarter was primarily attributable to an increase in the Company’s indebtedness to finance the Culver Specialty Brands acquisition, and an additional $0.8 million of amortization of deferred debt financing costs and bond discount relating to the acquisition financing.
The Company’s reported net income under U.S. generally accepted accounting principles (GAAP) was $16.9 million, or $0.35 per diluted share, for the third quarter of 2012, as compared to reported net income of $12.1 million, or $0.25 per diluted share, for the third quarter of 2011. The Company’s adjusted net income for the third quarter of 2011 was $12.4 million.
For the third quarter of 2012, EBITDA increased 37.7% to $42.8 million from $31.1 million for the third quarter of 2011.Financial Results for the First Three Quarters of 2012 Net sales for the first three quarters of 2012 increased 16.8% to $460.1 million from $393.9 million for the first three quarters of 2011. Net sales of the Culver Specialty Brands contributed $65.3 million to the Company’s net sales for the first three quarters of 2012. Net sales for the base business increased $0.9 million, with a sales price increase of $10.3 million offset by a $9.4 million unit volume decline.
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