Earthbound Farm, the new kid on the block at WhiteWave Foods Co., continues to boost its new parent company’s bottom line, accounting for almost 20% of WhiteWave’s net sales in the second quarter this year.
Without Earthbound’s numbers, WhiteWave’s net sales for the quarter ending June 30 would have increased only 11%, said chief executive officer Gregg Engles during an Aug. 7 conference call. With the Earthbound sales, WhiteWave posted a 36% increase in net sales compared to the second quarter of 2013.
Earthbound’s net sales of $153 million accounted for more than 18.5% of WhiteWave’s total net sales of $838 million for the quarter. During the first quarter this year — the first time WhiteWave’s financial report included the fruits of its $600 million acquisition of Earthbound — the San Juan Batista, Calif., organic grower-shipper generated 17.5% of the parent company’s net sales.
“Management expects net sales growth of approximately 30% in the third quarter of 2014, which reflects typical seasonality in Earthbound Farm’s business,” according to Denver-based WhiteWave’s financial statement. “Excluding Earthbound Farm, management expects net sales on an organic basis to increase 8% to 9% over the balance of 2014.”
Part of the anticipated growth will come from expansions to the Earthbound line of products, said Kevin Yost, Earthbound Farm president. Organic salads continue to increase their market share, increasing two percentage points during the second quarter to capture 24% of the overall packaged salad category, according to WhiteWave’s report.
“There is tremendous growth potential in the packaged greens category,” Yost said. “We will continue with more (product) line extensions and packaging innovations. We need to be innovative, too, in increasing retail shelf space.”
In response to questions from financial analysts, Yost said Earthbound Farm isn’t feeling much effect from the drought in California. He said the company’s growing operations there are disproportionally driven by well water. Yost said other regions, especially the Central Valley where Earthbound does not have fields, are not as fortunate.
WhiteWave’s acquisition of Earthbound Farm was finalized in January. WhiteWave’s other brands include Silk brand plant-based non-dairy products, Alpro, Horizon Organic, International Delight and Land O Lakes.