The services of David J. Colo as president, chief executive officer and board member of Mississauga, Ontario, Canada-headquartered SunOpta Inc. have been terminated. Katrina L. Houde, an 18-year director of the company, which supplies a wide assortment of food and beverage products that include Pure Nature brand frozen vegetables and fruits, has stepped in to serve as interim ceo until a fulltime replacement is named.
“I thank the board for entrusting me with the job,” said Houde, who has held the interim ceo post in the past. “During the transition, the board and I will take full advantage of available resources to continue progress in the company’s go-to-market strategy, process sustainability, and operational excellence initiatives.”
Colo spent two years at the helm of SunOpta, joining the company in February of 2017 after working as executive vice president and chief operating officer at Diamond Foods for three years. His experience prior to that included a senior leadership position at the consumer products division of ConAgra Foods.
After wishing Colo well in future endeavors, Chairman Dean Hollis commented: “Since 2016, SunOpta has made substantial progress in its transformation. The company has exited and sold unprofitable and non-core business lines, made significant investments in food safety and quality, and returned to growth. In the next phase of our transformation, we intend to relentlessly drive growth and enhance productivity in our core consumer products platforms, while maintaining our leadership position in global organic ingredients sourcing and remaining well aligned with consumer trends towards organic and non-GMO foods.”
Q4 Revenues up 9.6%
Meanwhile, on February 26 the company reported that revenues of $320.5 million for the fourth quarter of 2018 ending on December 29 were up 9.6% over $292.4 million generated during Q4 of 2017. Adjusted for changes in foreign exchange, commodity prices, and the discontinuation of flexible resealable pouch and nutrition bar products, receipts grew 16.0% during the fourth quarter.
Loss attributable to common shareholders, however, amounted to $99.0 million, or $1.13 per common share in the fourth quarter of 2018, compared to a loss attributable to common shareholders of $119.4 million, or $1.38 per common share in the fourth quarter of 2017. The losses in Q4 of 2018 and 2017 included non-cash goodwill impairment charges of $81.2 million and $115.0 million, respectively, associated with the healthy fruit platform.
The adjusted loss was $9.3 million or $0.11 per common share during the fourth quarter of 2018, compared to an adjusted loss of $8.8 million in Q4 2017.
Frozen Fruit Profitability Slips
“While we achieved our goal of delivering $20 million of productivity savings in 2018, these productivity gains were more than offset by decreased profitability in frozen fruit as we invested in food safety, quality, service and price to improve our positioning and key customer relationships,” said Houde. “Fourth quarter profitability was additionally pressured by growth investments and costs associated with the launch of new SKUs across the consumer products segment. As a result, fourth quarter margins were not reflective of the earnings potential of our business. In 2019, our top priority is to maintain our top-line momentum while driving higher profitability through our fruit margin optimization plan.”
