Hansen Natural Reports Net Loss

The beverage company missed fourth quarter earnings estimates due to distributors termination charges.
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On February 26, 2009,

Hansen Natural Corporation


reported that it swung to a net loss during Q4 FY08 on account of distributors termination charges. The company recorded termination charges of $118.20 million associated with the termination of some of its prior distributors. Net loss totaled $23.45 million or $0.25 per share compared to a profit of $45.10 million or $0.45 per share a year ago. The consensus estimate for the latest quarter was a profit of $0.42 per share.

Total net sales for the quarter increased 3.1% to $254.37 million from $246.64 million a year ago, supported by higher prices for Monster Energy brand energy drinks and the Java Monster line of non-carbonated, dairy-based coffee drinks. Average net sales price per case increased to $10.76 from $9.61, while total case sales (in 192-ounce case equivalents) dropped to 23.65 million from 25.66 million a year ago. Sales from the company's DSD segment rose 3.5% to $231.90 million from $224.20 million in the prior year's quarter. Meanwhile, gross sales outside the U.S. grew to $16.90 million from $15.30 million in the comparable quarter of the last year.

During Q4 FY08, Dyer & Berens LLP filed a class action lawsuit against Hansen alleging the issuance of false and misleading statements concerning its business, financial performance and prospects. Also during the quarter, HANS signed a distribution agreement with a subsidiary of Grupo Jumex for distribution of Monster Energy drinks throughout Mexico starting January 2009.

For FY08, net sales increased 14.3% to $1.03 billion from $904.47 million in the previous year, driven by favorable volume and prices. However, earnings dropped 27.7% to $108.03 million or $1.11 per share from $149.41 million or $1.51 per share, hurt by distributor transition charges.