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Showing posts from July, 2012

Can Green Mountain Coffee Roasters explain those missing beans?

Green Mountain Coffee Roasters (NASDAQ: GMCR) can't seem to get its act together. It appears to have made a significant error in a recent revision of its segment numbers. Specifically, $15.2 million of purported revenue adjustments for a twenty-six period in 2011 are unaccounted for. Its revenue adjustments do not match revenue numbers disclosed in other financial reports.

Background

Green Mountain Coffee Roasters operates its business under three segments: Specialty Coffee business unit (“SCBU”), Keurig business unit (“KBU”) and a Canadian business unit (“CBU”). Starting in fiscal year 2012, GMCR moved its Timothy’s subsidiary out of the SCBU segment and into the CBU segment. At the same time it moved a portion of the At Home ("AH") single cup business from its KBU segment to its CBU segment.

In subsequent 10-Q reports issued during fiscal year 2012, Green Mountain Coffee revised its previous fiscal year 2011 segment numbers to show Timothy’s as part of the CBU segment. …

Green Mountain Coffee’s Numbers Submitted to S.E.C. Examiners Don’t Add Up

Last April, the Securities and Exchange Commission Division of Corporation Finance sent Green Mountain Coffee Roasters (NASDAQ: GMCR) a comment letter requesting certain information about its segment reporting in its 10-K report for the fiscal year ended September 24, 2011. The S.E.C.’s comment letter and the company’s response were just made public this week.

Green Mountain Coffee has three operating segments: Specialty Coffee business unit (“SCBU”), Keurig business unit (“KBU”) and a Canadian business unit (“CBU”). The company provided certain financial information to the S.E.C. examiners relating to its Timothy’s subsidiary for the five quarter period ended September 24, 2011 when it was included in the SCBU reportable segment. However, Timothy’s numbers appear to be erroneous when compared to financial disclosures made by the company in other S.E.C. filings.


If Green Mountain Coffee’s numbers are to be believed, then its income before taxes for its Timothy’s subsidiary exceeded g…