Keurig Green Mountain is exploding
Shares of Keurig Green Mountain surged by as much as 21% in early trading on Thursday.
On Wednesday afternoon the company reported fiscal fourth-quarter results that beat expectations as well as an increase in dividends.
The company's stock has fallen by more than 60% this year amid aplunge in sales.
The specialty coffee maker reported a 13% drop in net sales to $1.04 billion during the quarter, though this still beat analysts' forecast for $1.03 billion, according to Bloomberg.
Earnings per share came in at $0.85, above the estimate for $0.70.
The company's board authorized a 13% increase in dividends.
Earlier this year, Keurig announced plans to lay off workers to cut costs.
CEO Brian Kelley said in the earnings statement: "I'm particularly pleased with the benefits realized from our cost-reduction efforts as well as our strong cash generation, both of which exceeded expectations in the fourth quarter. While we expect marketplace conditions will remain challenging in the near term, we have a stronger product lineup and price positioning as we enter the new holiday season."
The company plans to roll out the Keurig Kold, a single-serve brewer for beverages, including sodas and iced tea, amid sliding soda sales in the US. The success of this product is crucial, after weak sales of the Keurig 2.0 model after customers discovered that it worked only with certain K-Cups.
In Q4, sales in every product category were lower compared with the same period last year. Net sales from pods fell 9% to $861.2 million and 32% to $123.6 million in the brewers and accessories category.
The company sold 2 million Keurig brewers during the quarter.Google
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