COCA Cola is set to snap up a tenth of Green Mountain Coffee Roasters (GMCR) sending the firm’s shares soaring in after hours trading.
The coffee company’s results for the three months to the end of December showed profits of $138.2m (£84.72m), an increase of 28 per cent from the same period last year. Net sales rose more modestly, climbing up by just four per cent to $1.386bn.
The group also revealed the terms of a major 10-year agreement with Coca-Cola. The drinks giant will work with GMCR to develop and promote its Keurig Cold product, which will allow customers to make their own cold beverages at home.
GMCR shares exploded after the news was released, with share prices climbing by around 40 per cent after hours.
The deal will see Coca Cola take a 10 per cent equity position in the coffee firm.
Sales of GMCR’s existing coffee brewers and accessories actually fell in comparison to the previous quarter, down less than one per cent to $375.1m. The sales do not include the new cold drink product.
Brian Kelley, CEO of GMCR, said that the firm was “very pleased with our solid gross margin progress”, adding that it was the group’s best Christmas yet.