National Beverage Corp.

N a t i o N a l   B e v e r a g e   C o r p.   /   2 0 1 2   a N N u a l   r e p o r t

refresh!

“ We hold these truths to be self-evident …”
Our America needs our Passion and Love —
All of it — from all of us —

Regulated Opportunities – Heavily Taxed Responsibilities . . .

FIZZ ++ FIZZ ++ FIZZ ++ FIZZ ++ FIZZ ++ FIZZ ++ FIZZ ++

Responsibilities and Opportunities are truly identical twins at birth; incapable of 
existing alone, yet in conclusion or celebration, they each act alone and apart.  
To shoulder the opportunities in business today, quite different and much 
heavier than ever in my lifetime, one must resort to a discipline of mental and 
physical astuteness!  There is more stamina and resilience necessary to cope  
with the successful conclusion of something, than the discipline necessary in 
attempting it!  Today, in America, there exists a severe injustice in being a striver, 
an opportunist – in thinking entrepreneurial!!  Absolutely!

Why now? . . . the negative influence of Power!  Divisiveness . . .

Just imagine our America absent a President Jefferson, Lincoln, Roosevelt, 
Truman and others who didn’t check the polls – but persevered to do the right 
thing – regardless!  Those who led, while flying the flag of Hope, stimulated our  
great society’s backbone . . . producing strivers, opportunity challengers and 
entrepreneurial builders of our great nation.  These great American Presidents 
encouraged and incentivized all Americans to confront the challenges that made 
her great.  Yes . . . Yankee ingenuity – an American walked upon the – moon!

National Beverage Corp. could not survive if it made products no one wanted, 
incurred debt our shareholders feared, or consistently failed at its plan.  Employees 
are not imprisoned, nor are investors locked in.  We are one of thousands of 
choices – for our consumers, customers, employees and investors.  This last 
statement differentiates business and government – setting aside votes and 
compensation.

Our Company is in transition from a style/culture that created its original 
framework, to a more aggressive development mode.  Also, the timing may 
initiate opportunistic innovations and alliances that will cause that curve to 
continue.  The soft drink industry is more exciting today than ever; any time all 
corners of something are in motion, advances are forthcoming . . . healthier 
ingredients, guidance referenced package sizes, eco-friendly containers, efficient 
production techniques, distribution alternatives, maturing soft drink infrastructure 
and a smarter, health-conscious society of consumers!  Many, many corners, lots 
of changes, a requisite for Innovation = A More Dynamic Future!  Certain of it . . .

2012  A n n u a l  R e p or t

FIZZ ++ $628.9 REVS . . . $67.1 OP . . . $.95 EPS    FIZZ ++

National Beverage Corp. is extremely fortunate in many ways, primarily due to  
its philosophy – culture – size and ownership.  A parallel exists, reflecting on an 
economic crisis comparative: Greece/America; Banks Too Big To Fail/Banks Too 
Small To Survive; Large Governmental Agencies/Entrepreneurial Enterprises.

The culture/philosophy of an enterprise determines its Passion-Efficiency Index.  
Once the PEI is near correct, profits or results can be relied upon; more importantly  
– continually relied upon.  (Imagine) a governmental agency or enterprise 
obtaining their results with management, whose only incentive is – ‘if they want 
to or not.’  Further, (imagine) a very large percentage do not agree with the 
philosophy and another larger group is being compromised with entitlements, 
coaxing them to perform.  Additionally, every so often, words of ridicule about 
their workers come from the leaders of this governmental agency that just 
announced – paychecks are not forthcoming.  A joke you say?  Certainly it is!  

This is how – America Inc. is presently managed!!

[Read the Article . . . Our Big Fat Greek Habits!  WSJ August 8, 2012]

National Beverage’s culture/philosophy prohibits this from Happening!!

At the FY 2011 Annual Shareholders meeting, we announced a fortification of 
our uniqueness by emphasizing: Focus – Function – Efficacy – Value!  FY 2012 
results confirmed that our agility/size affords us flexibility when abrupt surprises 
occur.  Agility also enhances our ability to quickly develop and market new 
products, giving us an edge with Company-owned and independent distributors.

National Beverage’s Crown Jewel . . . Creativity/Innovation – in a industry where 
the consumer’s zest for ‘different’ – is a near daily priority.  This natural ingredient 
is proprietary and runs as liquid miracle  through the arteries of Team National.  
Over the upcoming months, several new brand themes are being introduced 
that will give our retail partners incremental use of space presently unmapped 
for revenue.  Theme brand introduction, while creating ‘new’ sales space, is quite 
novel and innovative, placing us on an exciting new course . . . nuevo curso . . . 
nouveau cours . . . nuovo corso – we are loving it!  More to come soon . . .  
“Hi BisCus!”

N a t i on a l  B e v er a g e  C or p.

FIZZ ++ $628.9 REVS . . . $67.1 OP . . . $.95 EPS    FIZZ ++

Over the past decade, National Beverage has strongly emphasized offering 
healthier beverages to our consumers.  We have lowered the caloric count in our 
flagship Shasta brand – with Shasta Oooh having zero calories, zero carbs and 
zero caffeine – long before zero was hip.  Our Everfresh 1/2 (50% less calories), 
Sundance (reduced calories) and our all-natural, zero calorie LaCroix brand, all 
appeal to the health-conscious consumer.

Often, profound sincerity routinely expressed, no longer is thought of as 
genuine.  Well, I want to reemphasize a Titanium commitment made to the 
intrepid shareholder/investor – that (formation) day long ago: “We will place 
your interests first; All-Ways, Always, All Times!”  That promise continues . . .

Focus – Function – Efficacy – Value!  While bold, for the nucleus of management, 
brand development, retailer partnerships and team building – they are formidable 
descriptives in the compassionate embrace with our . . . Shareholders!

Come on America – It’s Time . . .

Writing this has been accompanied by viewing Olympian competitiveness!  The 
Games have been a positive ‘stimulator.’  Americans everywhere crave the end of 
the Un-Americanism generated from the – Number One’s  Capitol retreat – daily!  
(The image of my so patriotic Grandfather, walking from Ellis Island, New York to 
a small village in southwestern Pennsylvania, his new life – in his new America, 
lives embedded in my heart!)  Can it be?  America’s Lamp of Hope – is out of fuel!

At one point, the huge screen provided a startling paradox.  In high resolution 
clarity, I witnessed a youngster give a breathtaking performance, locking up a 
Gold medal.  Suddenly on screen, a political campaign ad; inapposite, there was 
the world’s most powerful leader, performing as well – doing exactly contrary to 
what the youngster representing our great democratic stalwart, so gallantly just 
– did!  There before my eyes, two American representatives; one, not yet mature 
but every ounce a champion – and the other, wearing the smile of a champ, 
exhibited inadequate ‘practice’ and ‘little heart’ as he failed to instill Hope  into 
his neglected Americans.  No medal this time . . .

The Greatest Leaders ever; Desperately needed to be!

2012  A n n u a l  R e p or t

FIZZ ++ FIZZ ++ FIZZ ++ FIZZ ++ FIZZ ++ FIZZ ++ FIZZ ++

Remember earlier, the man who walked from Ellis Island to Pennsylvania?  Well 
he did it again, this time with a pregnant new wife.  As was the custom, upon my 
birth, I was given my grandfather’s name.  So, I soon became his talking buddy; 
carting a large bowl of vegetables, doused with wine vinegar/olive oil, I often 
walked this lunch to him.  Sitting, back-to-tree near his garden, hands motioning 
as he spoke his language, “Nicola, America was made for you and me” . . . biting 
on the tomato.  I listened – “Here, you can be anything; all you have to do is 
want it bad enough and work hard!  Here,” cupping his hands together, “God 
holds you – like this, Nicola!  Here . . . the Sun never sleeps.”  He was right!

Together . . . All Americans must wield profound courage, that gallant Americans 
before us so valiantly dared, while creating this – the greatest nation on the planet!

(What happened to the America that belonged to my Grandfather and me?)

Let’s get it back on track again . . . Let’s Refresh America’s image . . . Let’s truly 
Refresh hope . . . Let’s absolutely Refresh our future – Now!!

Come on America – It’s Time . . . Team National Will Do More Than Its Part!

Nick A. Caporella 
Chairman & Chief Executive Officer

N a t i on a l  B e v er a g e  C or p.

 
 
Let’s do it, America …

Refresh!Shasta & Faygo – Turn of the century soft drinks . . .

True Americana icons that have endured and 

matured into favorites for the celebrations  

and patriotic times in our lives.

6

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N a t i on a l  B e v er a g e  C or p.

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Focus…Ready – Set – FOCUS  – Innovate . . .

. . . 21st century champions!

The tomorrow of carbonated soft drinks is a holiday in 

spirit; every bit refreshing and fun-filled and true to our 

heritage – also healthier for the health of our nation.

Every day – every way, our consumers know . . .  

we are natural innovators.

2012  A n n u a l  R e p or t

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If it does something – it’s Functional . . .

If Sir William was around today, he certainly would agree, 

“Never say Ever . . . without saying Fresh!”    We feel that also 

applies to all of our good-for-you beverages.  Look-alikes 

are just that . . . National Beverage dares to be – Functional!

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N a t i on a l  B e v er a g e  C or p.

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Functional…“To Be . . . or Not to Be,”  Sir William Shakespeare is  
quoted. Certainly our aim is “To Be . . . FUNCTIONAL!”

If it does something great . . . it’s Ours!

Reducing calories while increasing taste is not 

easy . . . but who said innovating was easy! 

Check out the great taste of our better-for-you’s.

2012  A n n u a l  R e p or t

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Efficacy is to National Beverage Corp. . . .

The long tedious call of duty, as in war or the tough  

paramedic night, necessitates the use of a boost  

to achieve peak performance.  Combine this with  

great taste and a refreshing thirst quencher – now,  

that’s our definition of Efficacy.

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N a t i on a l  B e v er a g e  C or p.

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Efficacy…Discriminating consumers are our choice,  
for they make EFFICACY  a covenant!

What water is to . . . Rain!

All natural is a class of its own – nothing can come 

close to this statement, whether a beverage or a 

character or a philosophy.

Genuine to the core!

Flavor may be our name . . . but Value is our game!

The Value of faith; the Value of trust; the Value of  

promise; the Value of future; the Value of . . . Us!

12

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N a t i on a l  B e v er a g e  C or p.

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Value…“Focus—Function—Efficacy—Value!  While bold, for the 

nucleus of management, brand development, retailer  

partnerships and team building—they are formidable  

descriptives in the compassionate embrace with our . . .  

Shareholders!”

National Beverage Corp.
Financial Review

Selected Financial Data

(In thousands, except per share

and footnote amounts)

SUM M A RY  O F  O PER AT I O NS:
Net sales
Cost of sales

Gross profit
Selling, general and administrative expenses
Interest expense
Other (expense) income—net

Income before income taxes
Provision for income taxes

Fiscal Year Ended

April 28,
2012

April 30,
2011

May 1,
2010

May 2,
2009

May 3,
2008(1)

$ 628,886
415,629

$ 600,193
381,539

$ 593,465
396,450

$ 575,177
405,322

$ 566,001
393,420

213,257
146,169
107
(85)

66,896
22,903

218,654
155,885
99
(20)

62,650
21,896

197,015
145,159
120
(351)

51,385
18,532

169,855
131,918
107
967

38,797
14,055

172,581
138,447
109
1,053

35,078
12,598

Net income

$  43,993

$  40,754

$  32,853

$  24,742

$  22,480

PER  SH A R E   DATA :
Basic net income (2)
Diluted net income (2)
Closing stock price (2)
Cash dividends paid(3)

BA L A N CE  SH EE T   DATA :
Cash and equivalents(3)
Working capital(3)
Property, plant and equipment—net
Total assets(3)
Deferred income tax liability
Shareholders’ equity(3)

$ 

.95
.95
14.68
—

$ 

.88
.88
13.92
2.30

$ 

.71
.71
11.60
1.35

$ 

.54
.54
10.47
—

$ 

.49
.49
8.05
.80

$  35,626
69,818
56,729
222,988
14,214
121,636

$  7,372
30,930
55,337
182,810
14,548
80,336

$  68,566
92,898
53,401
240,359
15,597
141,572

$  84,140
117,840
56,141
265,682
16,517
170,012

$  51,497
89,396
57,639
239,122
16,624
144,625

Cash dividends paid(3)

— 106,314

62,295

—

36,711

(1) Fiscal 2008 consisted of 53 weeks.
(2)  Basic net income per share is computed by dividing earnings applicable to common shares by the weighted average number 
of shares outstanding. Diluted net income per share includes the dilutive effect of stock options. Net income per share and the 
closing stock price have been adjusted for the 20% stock dividend distributed on June 22, 2007.

(3)  The Company paid cash dividends of $106.3 million ($2.30 per share) on February 14, 2011, $62.3 million ($1.35 per share) on 

January 22, 2010, and $36.7 million ($.80 per share) on August 17, 2007.

14

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N a t i on a l  B e v er a g e  C or p.

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Management’s Discussion and Analysis of Financial  
Condition and Results of Operations

OV ER V IE W

National Beverage Corp. is a holding company for 
various  subsidiaries  that  develop,  manufacture, 
market  and  sell  a  diverse  portfolio  of  beverage 
products.  In  this  report,  the  terms  “we,”  “us,”  
“our,” “Company” and “National Beverage” mean 
National  Beverage  Corp.  and  its  subsidiaries 
unless indicated otherwise. 

Our  brands  include  soft  drinks,  energy  drinks 
and  shots,  juices,  teas,  still  and  sparkling  waters 
and  nutritionally  enhanced  beverages,  and  span 
both carbonated and non-carbonated offerings. In 
addition, we produce soft drinks for certain retailers 
(“Allied  Brands”)  who  also  promote  certain  of  
our  brands  (“Strategic  Alliances”).  We  employ  a 
 philosophy  that  demands  vertical  integration  
wherever  possible  and  our  vertically  integrated 
manufacturing  model  unites  the  procurement  of 
raw  materials,  production  of  concentrates  and 
manufacturing  of  finished  products  in  our  twelve 
manufacturing  facilities.  To  service  a  diverse 
customer  base  that  includes  numerous  national 
retailers  as  well  as  hundreds  of  smaller  “up-and 
down-the-street”  accounts,  we  have  developed  a 
hybrid   distribution  system  which  promotes  and 
utilizes customers’ warehouse distribution facilities 
and  our  own  direct-store  delivery  fleet  plus  the 
direct-store  delivery  systems  of  independent 
distributors. 

We  consider  ourselves  to  be  a  leader  in  the 
development  and  sale  of  flavored  beverage 
products. Our soft drink flavor development spans 
over 100 years originating with our flagship brands, 
Shasta®  and  Faygo®,  and  includes  our  Ritz®  and 
Big  Shot®  brands.  For  the  health-conscious 
consumer,  we  offer  a  diverse  line  of  flavored 
beverage  products,  including  Everfresh®,  Home 
Juice® and Mr. Pure® 100% juice and juice-based 
products; LaCroix®, Crystal Bay® and Clear Fruit® 
flavored, sparkling and spring water products; and 
Àsanté®  nutritionally-enhanced  beverage.  In 
addition,  we  produce  and  market  Rip  It®  energy 
drinks  and  shots,  Ohana®  fruit-flavored  non-
carbonated drinks, Sundance® teas and lemonades 

and St. Nick’s® holiday soft drinks. We refer to our 
portfolio  of  brands  other  than  soft  drinks  as  our 
“Power+ Brands.”

Our  strategy  emphasizes  the  growth  of  our 
products  by  (i)  offering  a  beverage  portfolio  of 
 proprietary  flavors  with  distinctive  packaging  and 
broad  demographic  appeal,  (ii)  supporting  the 
franchise value of regional brands, (iii) appealing to 
the  “quality-value”  expectations  of  the  family 
consumer  and  (iv)  responding  to  demographic 
trends  by  developing  innovative  products  tailored 
toward  healthy  lifestyles  or  designed  to  expand 
distribution in higher-margin channels. 

The majority of our sales are seasonal with the 
highest volume typically realized during the summer 
months. As a result, our operating results from one 
fiscal quarter to the next may not be comparable. 
Additionally,  our  operating  results  are  affected  by 
numerous  factors,  including  fluctuations  in  the 
costs  of  raw  materials,  changes  in  consumer 
preference  for  beverage  products,  competitive 
pricing in the marketplace and weather conditions. 

R E SULT S   O F  O PER AT I O NS

Net  Sales  Net  sales  for  the  fiscal  year  ended 
April  28,  2012  (“Fiscal  2012”)  increased  4.8%  to 
$628.9  million  as  compared  to  $600.2  million  for 
the fiscal year ended April 30, 2011 (“Fiscal 2011”). 
The  sales  improvement  is  due  to  case  volume 
growth of 9.9% for our Power+ Brands and 1.4% 
for   carbonated  soft  drinks.  In  addition,  our  unit 
pricing  increased  1.3%  due  to  price  increases 
implemented to offset higher raw material costs. 

Net  sales  for  Fiscal  2011  increased  1.1%  to 
$600.2  million  as  compared  to  $593.5  million  for 
the fiscal year ended May 1, 2010 (“Fiscal 2010”). 
The  sales  improvement  is  due  to  case  volume 
growth  of  13.2%  for  our  Power+  Brands,  and  a 
1.2%  increase  in  unit  pricing  resulting  from 
favorable  product  mix  changes.  This  sales 
improvement was partially offset by a 2.1% volume 
decline for branded carbonated soft drinks due to 
weak demand in certain regional markets. 

2012  A n n u a l  R e p or t

15

(cid:31)(cid:31)(cid:31)Management’s Discussion and Analysis of Financial  
Condition and Results of Operations (continued)

Gross  Profit  Gross  profit  approximated  33.9% 
of  net  sales  for  Fiscal  2012,  which  represents  a 
2.5%  margin  decline  compared  to  Fiscal  2011. 
During  Fiscal  2011  we  benefited  from  sales  of 
certain high margin products to overseas locations. 
These  sales  were  impacted  during  Fiscal  2012 
and, accordingly, gross margins returned to more 
normalized levels. The gross margin decline is also 
due to higher raw material costs and other changes 
in product mix. Cost of sales increased 5.3% on a 
per case basis. 

Gross profit approximated 36.4% of net sales 
for  Fiscal  2011,  which  represents  a  3.2%  margin 
improvement  over  Fiscal  2010.  This  gross  margin 
improvement is primarily due to favorable changes 
in brand and package mix. Cost of sales decreased 
3.7% on a per case basis. 

Shipping  and  handling  costs  are  included  in 
selling,  general  and  administrative  expenses,  the 
classification  of  which  is  consistent  with  many 
 beverage  companies.  However,  our  gross  margin 
may not be comparable to companies that include 
shipping  and  handling  costs  in  cost  of  sales.  
See  Note  1  of  Notes  to  Consolidated  Financial 
Statements.

Selling,  General  and  Administrative  Expenses  
Selling, general and administrative expenses were 
$146.2 million or 23.2% of net sales for Fiscal 2012 
compared to $155.9 million or 26.0% of net sales 
for Fiscal 2011. The decline in expenses is due to a 
decrease in marketing and administrative expenses. 
Selling,  general  and  administrative  expenses 
were $155.9 million or 26.0% of net sales for Fiscal 
2011  compared  to  $145.2  million  or  24.5%  of  net 
sales for Fiscal 2010. The increase in expenses was 
primarily due to additional investment in expanded 
distribution,  including  expanded  marketing  and 
selling programs. Marketing costs reflect increased 
cooperative  advertising  programs  with  customers 
and increased brand support expenditures. 

Interest  Expense  and  Other  Expense—Net  
Interest  expense  is  comprised  of  interest  on 
borrowings and fees related to maintaining lines of 
credit.  Other  expense  is  net  of  interest  income  of 
$69,000 for Fiscal 2012, $140,000 for Fiscal 2011 
and  $229,000  for  Fiscal  2010.  The  decline  in 
interest  income  for  Fiscal  2012  is  due  to  lower 
average  invested  balances  and  investment  yields. 
The  decline  in  interest  income  for  Fiscal  2011  is 
due to lower investment yields. 

Income  Taxes  Our  effective  tax  rate  was 
approxi  mately  34.2%  for  Fiscal  2012,  34.9%  for 
Fiscal  2011  and  36.1%  for  Fiscal  2010.  The 
difference  between  the  effective  rate  and  the 
federal statutory rate of 35% was primarily due to 
the  effects  of  state  income  taxes  and  the 
manufacturing deduction. See Note 8 of Notes to 
Consolidated Financial Statements.

L I Q UID I T Y  AN D  FIN AN CIAL  CO N D I T I O N

Liquidity  and  Capital  Resources  Our  principal 
source of funds is cash generated from operations, 
which  may  be  supplemented  by  borrowings 
available  under  our  credit  facilities.  The  Company 
maintains  $75  million  unsecured  revolving  credit 
facilities  of  which  $2.4  million  was  utilized  for 
standby  letters  of  credit  at  April  28,  2012.  We 
believe  that  existing  capital  resources  will  be 
sufficient to meet our capital requirements for the 
foreseeable  future.  See  Note  4  of  Notes  to 
Consolidated Financial Statements.

We  continually  evaluate  capital  projects  to 
expand  our  production  capacity,  enhance 
packaging  capabilities  or  improve  efficiencies  at 
our  manufacturing  facilities.  Expenditures  for 
property,  plant  and  equipment  amounted  to  $9.9 
million  for  Fiscal  2012;  there  were  no  material 
capital expenditure commitments at April 28, 2012.
The  Company  paid  special  cash  dividends  
of $106.3 million ($2.30 per share) on February 14, 
2011  and  $62.3  million  ($1.35  per  share)  on 
January 22, 2010. 

16

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(cid:31)(cid:31)(cid:31)Pursuant  to  a  management  agreement,  we 
incurred a fee to Corporate Management Advisors, 
Inc. (“CMA”) of approximately $6.3 million for Fiscal 
2012, $6.0 million for Fiscal 2011 and $5.9 million 
for  Fiscal  2010.  At  April  28,  2012,  management 
fees payable to CMA were $3.0 million. See Note 5 
of Notes to Consolidated Financial Statements.

Cash Flows  During Fiscal 2011 and Fiscal 2010, 
cash  flow  was  significantly  impacted  by  the 
payment of two special cash dividends aggregating 
$168.6 million. 

During Fiscal 2012, $37.7 million was provided 
by  operating  activities,  which  was  offset  by  $9.9 
million  used  in  investing  activities.  Cash  provided 
by  operating  activities  decreased  $17.6  million 
 primarily due to increases in trade receivables and 
inventories as well as a decline in accrued liabilities. 
Cash  used  in  investing  activities  decreased  $1.5 
million due to lower capital expenditures.

During Fiscal 2011, $55.3 million was provided 
by operating activities, offset by $11.3 million used 
in  investing  activities  and  a  special  cash  dividend 
payment  of  $106.3  million.  Cash  provided  by 
operating  activities  increased  $.9  million  primarily 
due  to  higher  earnings.  Cash  used  in  investing 
activities  increased  $3.0  million  due  to  expanded 
capital investments. 

Financial  Position  During  Fiscal  2012,  our 
working  capital  increased  $38.9  million  to  $69.8 
million due to cash provided by operating activities. 
Trade  receivables  increased  $5.7  million,  which 
represents  an  increase  in  days  sales  outstanding 
from  approximately  33.4  days  to  33.9  days,  and 
inventories increased $7.5 million, which represents 
a  reduction  in  annual  inventory  turns  from  11.7  to 
11 times. These increases are primarily due to the 
commencement  of  a  new  Strategic  Alliance 
agreement  in  the  latter  part  of  Fiscal  2012.  The 
increase  in  inventory  is  also  due  to  higher  raw 
material  costs  and  quantity  increases  related  to 
anticipated sales growth. Prepaid and other assets 
decreased $4.0 million due to a decline in the fair 
value of derivative assets. See Note 6 of Notes to 
Consolidated  Financial  Statements.  At  April  28, 
2012, the current ratio was 1.9 to 1, as compared 
to 1.4 to 1 at April 30, 2011.

During  Fiscal  2011,  our  working  capital 
decreased $62.0 million to $30.9 million due to the 
special  cash  dividend  paid  in  February  2011. 
Inventory  decreased  $1.3  million  due  to  reduced 
inventory  quantities.  Prepaid  and  other  assets 
increased $4.2 million primarily due to an increase 
in  the  fair  value  of  derivative  assets.  At  April  30, 
2011, the current ratio was 1.4 to 1, as compared 
to 2.3 to 1 at May 1, 2010.

CO N T R AC T UAL  O B LI G AT I O NS

Contractual obligations at April 28, 2012 are payable as follows:

(In thousands)

Operating leases
Purchase commitments

Total

Total

Less Than
1 Year

1 to 3
Years

3 to 5 More Than
Years

5 Years

$  16,461
102,785

$  4,261
57,830

$  5,151
44,955

$ 3,673
—

$3,376
—

$ 119,246

$62,091

$ 50,106

$ 3,673

$3,376

As  of  April  28,  2012,  we  guaranteed  the 
residual  value  of  certain  leased  equipment  in  the 
amount  of  $7.1  million.  If  the  proceeds  from  the 
sale of such equipment are less than the balance 
required  by  the  lease  when  the  lease  terminates 
July  31,  2012,  the  Company  shall  be  required  to 

pay the difference up to such guaranteed amount. 
The  Company  expects  to  have  no  loss  on  such 
guarantee. 

We  contribute  to  certain  pension  plans  under 
collective  bargaining  agreements  and  to  a 
discretionary profit sharing plan. Total contributions 

2012  A n n u a l  R e p or t

17

(cid:31)(cid:31)(cid:31)Management’s Discussion and Analysis of Financial  
Condition and Results of Operations (continued)

were  $2.5  million  for  Fiscal  2012,  $2.5  million  for 
Fiscal  2011  and  $2.3  million  for  Fiscal  2010.  See 
Note  10  of  Notes  to  Consolidated  Financial 
Statements. 

We  maintain  self-insured  and  deductible 
programs for certain liability, medical and workers’ 
compensation exposures. Other long-term liabilities 
include  known  claims  and  estimated  incurred  but 
not  reported  claims  not  otherwise  covered  by 
insurance,  based  on  actuarial  assumptions  and 
historical  claims  experience.  Since  the  timing  and 
amount  of  claim  payments  vary  significantly,  we 
are  not  able  to  reasonably  estimate  future 
payments for the specific periods indicated in the 
table above. In connection with our self-insurance 
programs,  we  have  standby  letters  of  credit 
aggregating $2.4 million which expire in fiscal 2013. 
We expect to renew these standby letters of credit.

O FF - BAL AN CE  SH EE T  AR R AN G E M EN T S

We  do  not  have  any  off-balance  sheet 
arrangements that have, or are reasonably likely to 
have,  a  current  or  future  material  effect  on  our 
financial condition.

CR I T I C AL  ACCO UN T IN G  P O LI CIE S

The  preparation  of  financial  statements  in 
conformity  with  generally  accepted  accounting 
principles requires management to make estimates 
and assumptions that affect the amounts reported 
in  the  financial  statements  and  accompanying 
notes.  Although  these  estimates  are  based  on 
management’s  knowledge  of  current  events  and 
actions  it  may  undertake  in  the  future,  they  may 
ultimately differ from actual results. We believe that 
the  critical  accounting  policies  described  in  the 
following paragraphs comprise the most significant 
estimates and assumptions used in the preparation 
of our consolidated financial statements. For these 
policies,  we  caution  that  future  events  rarely 
develop  exactly  as  estimated  and  the  best 
estimates routinely require adjustment.

Credit  Risk  We  sell  products  to  a  variety  of 
customers  and  extend  credit  based  on  an 
evaluation  of  each  customer’s  financial  condition, 
generally  without  requiring  collateral.  Exposure  to 
credit losses varies by customer principally due to 
the  financial  condition  of  each  customer.  We 
monitor our exposure to credit losses and maintain 
allowances for anticipated losses based on specific 
customer  circumstances,  credit  conditions  and 
historical write-offs. 

Impairment of Long-Lived Assets  All long-lived 
assets,  excluding  goodwill  and  intangible  assets 
not subject to amortization, are evaluated for impair-
ment  on  the  basis  of  undiscounted  cash  flows 
whenever  events  or  changes  in  circumstances 
indicate that the carrying amount of an asset may 
not  be  recoverable.  An  impaired  asset  is  written 
down  to  its  estimated  fair  market  value  based  on 
the  best  information  available.  Estimated  fair 
market value is generally measured by discounting 
future  cash  flows.  Goodwill  and  intangible  assets 
not  subject  to  amortization  are  evaluated  for 
impairment  annually  or  sooner  if  we  believe  such 
assets  may  be  impaired.  An  impairment  loss  is 
recognized if the carrying amount or, for goodwill, 
the carrying amount of its reporting unit, is greater 
than its fair value.

Income  Taxes  Our  effective  income  tax  rate  is 
based  on  estimates  of  taxes  which  will  ultimately 
be  payable.  Deferred  taxes  are  recorded  to  give 
recognition  to  temporary  differences  between  the 
tax bases of assets or liabilities and their reported 
amounts  in  the  financial  statements.  Valuation 
allowances are established to reduce the carrying 
amounts of deferred tax assets when it is deemed, 
more  likely  than  not,  that  the  benefit  of  deferred 
tax assets will not be realized.

Insurance  Programs  We  maintain  self-insured 
and  deductible  programs  for  certain  liability, 
 medical  and  workers’  compensation  exposures. 
Accordingly,  we  accrue  for  known  claims  and 
 estimated  incurred  but  not  reported  claims  not 
otherwise covered by insurance based on actuarial 
assumptions and historical claims experience.

18

N a t i on a l  B e v er a g e  C or p.

(cid:31)(cid:31)(cid:31)Sales Incentives  We offer various sales incentive 
arrangements  to  our  customers  that  require 
customer  performance  or  achievement  of  certain 
sales  volume  targets.  In  those  circumstances 
when the incentive is paid in advance, we amortize 
the  amount  paid  over  the  period  of  benefit  or 
contractual  sales  volume.  When  the  incentive  is 
paid in arrears, we accrue the expected amount to 
be paid over the period of benefit or expected sales 
volume. The recognition of these incentives involves 
the  use  of  judgment  related  to  performance  and 
sales  volume  estimates  that  are  made  based  on 
historical  experience  and  other  factors.  Sales 
incentives  are  accounted  for  as  a  reduction  of 
sales  and  actual  amounts  ultimately  realized  may 
vary from accrued amounts. 

FO RWAR D - LO O K IN G  S TAT E M EN T S

National  Beverage  and  its  representatives  may 
make  written  or  oral  statements  relating  to  future 
events or results relative to our financial, operational 
and  business  performance,  achievements, 
objectives  and  strategies.  These  statements  are 
“forward-looking” within the meaning of the Private 
Securities  Litigation  Reform  Act  of  1995  and 
include statements contained in this report, filings 
with  the  Securities  and  Exchange  Commission 
and  other  reports  or  communications  to  our 
stockholders.  Certain  statements  including, 
without limitation, statements containing the words 
“believes,” “anticipates,” “intends,” “plans,” “expects,” 
and  “estimates”  constitute  “forward-looking 
statements” and involve known and unknown risk, 
uncertainties and other factors that may cause the 
actual  results,  performance  or  achievements  of 
our  Company  to  be  materially  different  from  any 
future  results,  performance  or  achievements 
expressed  or  implied  by  such  forward-looking 
statements.  Such  factors  include,  but  are  not 
limited  to,  the   following:  general  economic  and 
business  conditions,  pricing  of  competitive 
products,  success  in  acquiring  other  beverage 
businesses,  success  of  new  product  and  flavor 
introductions,  fluctuations  in  the  costs  of  raw 
materials  and  packaging   supplies,  ability  to  pass 

along  cost  increases  to  our  customers,  labor 
strikes or work stoppages or other interruptions in 
the employment of labor, continued retailer support 
for our products, changes in consumer preferences 
and  our  success  in  creating  products  geared 
toward consumers’ tastes, success in implementing 
business strategies, changes in business strategy 
or  development  plans,  government  regulations, 
taxes or fees imposed on the sale of our products, 
unseasonably cold or wet weather conditions and 
other   factors  referenced  in  this  report,  filings  with 
the Securities and Exchange Commission and other 
reports  or  communications  to  our  stockholders. 
We  disclaim  an  obligation  to  update  any  such 
factors  or  to  publicly  announce  the  results  of  any 
revisions  to  any  forward-looking  statements 
contained  herein  to  reflect  future  events  or 
developments.

Q UAN T I TAT I V E  AN D   Q UAL I TAT I V E 
D IS CLOSUR E S   AB O U T  M AR K E T  R ISK

Commodities  We purchase various raw materials, 
including  aluminum  cans,  plastic  bottles,  high 
fructose  corn  syrup,  corrugated  packaging  and 
juice  concentrates,  the  prices  of  which  fluctuate 
based  on  commodity  market  conditions.  Our 
 ability  to  recover  increased  costs  through  higher 
pricing  may  be  limited  by  the  competitive 
environment  in  which  we  operate.  At  times,  we 
manage our exposure to this risk through the use 
of   supplier  pricing  agreements  that  enable  us  to 
establish  the  purchase  prices  for  certain 
commodities.  Additionally,  we  use  derivative 
financial  instruments  to  partially  mitigate  our 
exposure to changes in certain raw material costs.

Interest  Rates  We  had  no  debt-related  interest 
rate  exposure  during  Fiscal  2012.  Our  investment 
portfolio  is  comprised  of  highly  liquid  securities 
consisting  primarily  of  short-term  money  market 
investments,  the  yields  of  which  fluctuate  based 
largely on short-term Treasury rates. 

2012  A n n u a l  R e p or t

19

(cid:31)(cid:31)(cid:31)Consolidated Balance Sheets

(In thousands, except share amounts)

A S SE T S
Current assets:
  Cash and equivalents
  Trade receivables—net of allowances of $399 (2012) and $452 (2011)

Inventories

  Deferred income taxes—net
  Prepaid and other assets

  Total current assets
Property, plant and equipment—net
Goodwill
Intangible assets
Other assets

L I A B I L I T I E S  A N D  SH A R EH O L D ER S’  E Q U I T Y
Current liabilities:
  Accounts payable
  Accrued liabilities

Income taxes payable

  Total current liabilities
Deferred income taxes—net
Other liabilities
Shareholders’ equity:
  Preferred stock, 7% cumulative, $1 par value, aggregate liquidation preference  

April 28,
2012

April 30,
2011

$  35,626
61,591
40,862
3,550
4,425

146,054
56,729
13,145
1,615
5,445

$  7,372
55,912
33,353
1,493
8,403

106,533
55,337
13,145
1,615
6,180

$ 222,988

$ 182,810

$  54,875
21,279
82

$  49,257
26,214
132

76,236
14,214
10,902

75,603
14,548
12,323

  of $15,000—1,000,000 shares authorized; 150,000 shares issued

150

150

  Common stock, $.01 par value—75,000,000 shares authorized; 50,321,559  

  shares (2012) and 50,262,139 shares (2011) issued

  Additional paid-in capital
  Retained earnings
  Accumulated other comprehensive (loss) income
  Treasury stock—at cost:

  Preferred stock—150,000 shares
  Common stock—4,032,784 shares

  Total shareholders’ equity

See accompanying Notes to Consolidated Financial Statements.

503
30,425
109,200
(642)

503
29,725
65,207
2,751

(5,100)
(12,900)

(5,100)
(12,900)

121,636

80,336

$222,988

$182,810

20

N a t i on a l  B e v er a g e  C or p.

(cid:31)(cid:31)(cid:31) 
 
 
 
 
 
Consolidated Statements of Income

(In thousands, except per share amounts)

Net sales
Cost of sales

Gross profit
Selling, general and administrative expenses
Interest expense
Other expense—net

Income before income taxes
Provision for income taxes

Net income

Net income per share:
  Basic
  Diluted

Weighted average common shares outstanding:
  Basic
  Diluted

See accompanying Notes to Consolidated Financial Statements.

Fiscal Year Ended

April 28,
2012

April 30,
2011

May 1,
2010

$ 628,886
415,629

$ 600,193
381,539

$ 593,465
396,450

213,257
146,169
107
85

66,896
22,903

218,654
155,885
99
20

62,650
21,896

197,015
145,159
120
351

51,385
18,532

$  43,993

$  40,754

$  32,853

$ 
$ 

.95
.95

$ 
$ 

.88
.88

$ 
$ 

.71
.71

46,267
46,448

46,188
46,373

46,065
46,294

2012  A n n u a l  R e p or t

21

(cid:31)(cid:31)(cid:31)Consolidated Statements of Shareholders’ Equity

(In thousands)

N U M B ER  O F  CO M M O N  SH A R E S   ISSU ED
Beginning of year
Stock options exercised

End of year

PR EFER R ED  S TO CK
Beginning and end of year

CO M M O N  S TO CK
Beginning of year
Stock options exercised

End of year

A D D I T I O N A L   PA I D - I N  C A PI TA L
Beginning of year
Stock options exercised
Stock-based compensation
Stock-based tax benefits

End of year

R E TA I N ED  E A R N I N G S
Beginning of year
Net income
Cash dividends

End of year

AC CUMU L AT ED  OT H ER   CO M PR EH ENSI V E   (LOSS)  I N CO M E
Beginning of year
Cash flow hedges
Other

End of year

T R E A SU RY  S TO CK— PR EFER R ED
Beginning and end of year

T R E A SU RY  S TO CK— CO M M O N
Beginning and end of year

TO TA L  SH A R EH O L D ER S’  EQ U I T Y

CO M PR EH ENSI V E  I N CO M E
Net income
Cash flow hedges
Other

Comprehensive income

See accompanying Notes to Consolidated Financial Statements.

22

N a t i on a l  B e v er a g e  C or p.

Fiscal Year Ended

April 28,
2012

April 30,
2011

May 1,
2010

50,262
60

50,322

50,189
73

50,262

50,045
144

50,189

$ 

150

$ 

150

$ 

150

503
—

503

29,725
115
290
295

30,425

502
1

503

28,150
208
446
921

29,725

500
2

502

27,153
264
349
384

28,150

65,207
43,993

130,767
40,754
— (106,314)

160,209
32,853
(62,295)

109,200

65,207

130,767

2,751
(3,063)
(330)

(642)

3
2,748
—

2,751

—
3
—

3

(5,100)

(5,100)

(5,100)

(12,900)

(12,900)

(12,900)

$ 121,636

$  80,336

$ 141,572

$  43,993
(3,063)
(330)

$  40,754
2,748
—

$  32,853
3
—

$  40,600

$  43,502

$  32,856

(cid:31)(cid:31)(cid:31)Consolidated Statements of Cash Flows

(In thousands)

O P ER AT I N G  AC T I V I T I E S:
Net income
Adjustments to reconcile net income to net cash  
  provided by operating activities:
  Depreciation and amortization
  Deferred income tax benefit
  Loss on disposal of property, net
  Stock-based compensation
  Changes in assets and liabilities:

  Trade receivables

Inventories

  Prepaid and other assets
  Accounts payable
  Accrued and other liabilities

Fiscal Year Ended

April 28,
2012

April 30,
2011

May 1,
2010

$43,993

$  40,754

$ 32,853 

10,651
(477)
7
290

(5,679)
(7,509)
(2,239)
5,618
(6,959)

11,356
(694)
82
446

(2,078)
1,319
(1,215)
829
4,503

12,350 
(1,026)
791 
349 

(99)
4,940 
8 
423 
3,796 

Net cash provided by operating activities

37,696

55,302

54,385 

I N V E S T I N G  AC T I V I T I E S:
Additions to property, plant and equipment
Proceeds from sale of property, plant and equipment

Net cash used in investing activities

FI N A N CI N G  AC T I V I T I E S:
Common stock cash dividend
Proceeds from stock options exercised
Stock-based tax benefits

Net cash provided by (used in) financing activities

N E T  I N CR E A SE  (D ECR E A SE )   I N   C A SH   A N D   EQ U I VA L EN T S

C A SH   A N D   EQ U I VA L EN T S — B EG I N N I N G  O F  Y E A R

C A SH   A N D   EQ U I VA L EN T S — EN D   O F   Y E A R

OT H ER  C A SH  FLOW   I N FO R M AT I O N:
Interest paid
Income taxes paid

See accompanying Notes to Consolidated Financial Statements.

(9,905)
53

(9,852)

(11,389)
77

(8,349)
35 

(11,312)

(8,314)

—
115
295

410

(106,314)
209
921

(62,295)
266 
384 

(105,184)

(61,645)

28,254
7,372

(61,194)
68,566

(15,574)
84,140 

$35,626

$ 

7,372

$ 68,566 

$      95
23,127

$ 

101
20,816

$ 

124 
18,541 

2012  A n n u a l  R e p or t

23

(cid:31)(cid:31)(cid:31) 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Notes to Consolidated Financial Statements

National Beverage Corp. develops, manufactures, 
markets  and  sells  a  diverse  portfolio  of  multi-
flavored  soft  drinks,  juice  drinks,  water  and 
specialty  beverages  primarily  in  North  America. 
Incorporated  in  Delaware  in  1985,  National 
Beverage  Corp.  is  a  holding  company  for  various 
operating  subsidiaries.  When  used  in  this  report, 
the  terms  “we,”  “us,”  “our,”  “Company”  and 
“National  Beverage”  mean  National  Beverage 
Corp. and its subsidiaries. 

1.  SI G NIFI C AN T  ACCO UN T IN G  P O LI CIE S

Basis of Presentation  Our consolidated financial 
statements  are  prepared  in  accordance  with 
accounting  principles  generally  accepted  in  the 
United States. The consolidated financial statements 
include  the  accounts  of  National  Beverage  Corp. 
and  all  subsidiaries.  All  significant  intercompany 
transactions  and  accounts  have  been  eliminated. 
Our  fiscal  year  ends  the  Saturday  closest  to  April 
30  and,  as  a  result,  an  additional  week  is  added 
every five or six years. Fiscal 2012, Fiscal 2011 and 
Fiscal 2010 consisted of 52 weeks. 

Cash  and  Equivalents  Cash  and  equivalents 
are comprised of cash and highly liquid securities 
(consisting  primarily  of  short-term  money-market 
investments)  with  an  original  maturity  of  three 
months or less.

Derivative  Financial  Instruments  We  use 
derivative financial instruments to partially mitigate 
our exposure to changes in raw material costs. All 
derivative financial instruments are recorded at fair 
value in our Consolidated Balance Sheets. We do 
not use derivative financial instruments for trading 
or  speculative  purposes.  Credit  risk  related  to 
derivative  financial  instruments  is  managed  by 
requiring  high  credit  standards  for  counterparties 
and frequent cash settlements. See Note 6. 

Fair Value  The fair values of our cash and cash 
equivalents, trade receivables and accounts payable 
approximate  their  carrying  amounts  due  to  their 
short-term nature. The estimated fair values of our 
derivative financial instruments are calculated based 
on  market  rates  to  settle  the  instruments.  These 
values represent the estimated amounts we would 
receive upon sale, taking into consideration current 
market prices and credit worthiness. See Note 6. 

Impairment of Long-Lived Assets  All long-lived 
assets,  excluding  goodwill  and  intangible  assets 
not  subject  to  amortization,  are  evaluated  for 
impairment  on  the  basis  of  undiscounted  cash 
flows whenever events or changes in circumstances 
indicate that the carrying amount of an asset may 
not  be  recoverable.  An  impaired  asset  is  written 
down  to  its  estimated  fair  market  value  based  on 
the  best  information  available.  Estimated  fair 
market value is generally measured by discounting 
future  cash  flows.  Goodwill  and  intangible  assets 
not  subject  to  amortization  are  evaluated  for 
impairment  annually  or  sooner  if  we  believe  such 
assets  may  be  impaired.  An  impairment  loss  is 
recognized if the carrying amount or, for goodwill, 
the carrying amount of its reporting unit, is greater 
than its fair value.

Income  Taxes  Our  effective  income  tax  rate  is 
based  on  estimates  of  taxes  which  will  ultimately 
be  payable.  Deferred  taxes  are  recorded  to  give 
recognition  to  temporary  differences  between  the 
tax bases of assets or liabilities and their reported 
amounts  in  the  financial  statements.  Valuation 
allowances are established to reduce the carrying 
amounts of deferred tax assets when it is deemed, 
more  likely  than  not,  that  the  benefit  of  deferred 
tax assets will not be realized.

Insurance  Programs  We  maintain  self-insured 
and  deductible  programs  for  certain  liability, 
medical  and  workers’  compensation  exposures. 
Accordingly,  we  accrue  for  known  claims  and 
estimated  incurred  but  not  reported  claims  not 
otherwise covered by insurance, based on actuarial 
assumptions and historical claims experience.

24

N a t i on a l  B e v er a g e  C or p.

(cid:31)(cid:31)(cid:31)Intangible assets as of April 28, 
Intangible Assets 
2012 and April 30, 2011 consisted of non-amortizable 
trademarks. 

Inventories  are  stated  at  the  lower  
Inventories 
of  first-in,  first-out  cost  or  market.  Inventories  at 
April  28,  2012  were  comprised  of  finished  goods 
of $24.4 million and raw materials of $16.5 million. 
Inventories  at  April  30,  2011  were  comprised  of 
finished  goods  of  $20.2  million  and  raw  materials 
of  $13.1  million.  (See  Management’s  Discussion 
and Analysis of Financial Condition and Results of 
Operations—Financial Position.)

Marketing  Costs  We  are  involved  in  a  variety  
of  marketing  programs,  including  cooperative 
advertising programs with customers, to advertise 
and promote our products to consumers. Marketing 
costs  are  expensed  when  incurred,  except  for 
prepaid  advertising  and  production  costs  which 
are  expensed  when  the  advertising  takes  place. 
Marketing  costs,  which  are  included  in  selling, 
general and administrative expenses, totaled $45.8 
million  in  Fiscal  2012,  $52.9  million  in  Fiscal  2011 
and $44.7 million in Fiscal 2010. 

Net  Income  Per  Share  Basic  net  income  per 
share  is  computed  by  dividing  net  income  by  the 
weighted  average  number  of  common  shares 
outstanding during the period. Diluted net income 
per  share  is  calculated  in  a  similar  manner,  but 
includes the dilutive effect of stock options, which 
amounted to 181,000 shares in Fiscal 2012, 185,000 
shares in Fiscal 2011 and 229,000 shares in Fiscal 
2010.  Options  to  purchase  291,000  shares  in 
Fiscal 2011 and 18,000 shares in Fiscal 2010 were 
not included in the calculation of diluted net income 
per share because these options were anti-dilutive. 

Property, Plant and Equipment  Property, plant 
and  equipment  are  recorded  at  cost.  Additions, 
replacements  and  betterments  are  capitalized, 
while maintenance and repairs that do not extend 
the useful life of an asset are expensed as incurred. 
Depreciation  is  recorded  using  the  straight-line 
method over estimated useful lives of 7 to 30 years 
for  buildings  and  improvements,  and  3  to  15  

years  for  machinery  and  equipment.  Leasehold 
improvements are amortized using the straight-line 
method  over  the  shorter  of  the  remaining  lease 
term or the estimated useful life of the improvement. 
When  assets  are  retired  or  otherwise  disposed, 
the  cost  and  accumulated  depreciation  are 
removed  from  the  respective  accounts  and  any 
related gain or loss is recognized. 

Revenue  Recognition  Revenue  from  product 
sales is recognized when title and risk of loss pass 
to  the  customer,  which  generally  occurs  upon 
delivery.  Our  policy  is  not  to  allow  the  return  of 
products  once  they  have  been  accepted  by  the 
customer. However, on occasion, we have accepted 
returns or issued credit to customers, primarily for 
damaged  goods.  The  amounts  have  been 
immaterial  and,  accordingly,  we  do  not  provide  a 
specific valuation allowance for sales returns.

Sales Incentives  We offer various sales incentive 
arrangements  to  our  customers  that  require 
customer  performance  or  achievement  of  certain 
sales  volume  targets.  In  those  circumstances 
when the incentive is paid in advance, we amortize 
the  amount  paid  over  the  period  of  benefit  or 
contractual  sales  volume.  When  the  incentive  is 
paid in arrears, we accrue the expected amount to 
be  paid  over  the  period  of  benefit  or  expected 
sales  volume.  The  recognition  of  these  incentives 
involves the use of judgment related to performance 
and sales volume estimates that are made based 
on  historical  experience  and  other  factors.  Sales 
incentives  are  accounted  for  as  a  reduction  of 
sales  and  actual  amounts  ultimately  realized  may 
vary from accrued amounts. 

Segment  Reporting  We  operate  as  a  single 
operating  segment  for  purposes  of  presenting 
financial  information  and  evaluating  performance. 
As such, the accompanying consolidated financial 
statements present financial information in a format 
that  is  consistent  with  the  internal  financial 
information  used  by  management.  We  do  not 
accumulate  revenues  by  product  classification 
and,  therefore,  it  is  impractical  to  present  such 
information.

2012  A n n u a l  R e p or t

25

(cid:31)(cid:31)(cid:31)Notes to Consolidated Financial Statements (continued)

Shipping  and  Handling  Costs  Shipping  and 
handling costs are reported in selling, general and 
administrative  expenses  in  the  accompanying 
statements  of  income.  Such  costs  aggregated 
$45.6 million in Fiscal 2012, $45.1 million in Fiscal 
2011  and  $43.0  million  in  Fiscal  2010.  Although 
our classification is consistent with many beverage 
companies,  our  gross  margin  may  not  be 
comparable  to  companies  that  include  shipping 
and handling costs in cost of sales.

Stock-Based  Compensation  Compensation 
expense for stock-based compensation awards is 
recognized  over  the  vesting  period  based  on  the 
grant-date  fair  value  estimated  using  the  Black-
Scholes model. See Note 9. 

Trade Receivables  We record trade receivables 
at  net  realizable  value,  which  includes  an 
appropriate  allowance  for  doubtful  accounts.  We 
extend  credit  based  on  an  evaluation  of  each 
customer’s  financial  condition,  generally  without 
requiring  collateral.  Exposure  to  credit  losses 
varies by customer principally due to the financial 
condition  of  each  customer.  We  monitor  our 
exposure to credit losses and maintain allowances 
for anticipated losses based on specific customer 
circumstances,  credit  conditions  and  historical 
write-offs.  Activity  in  the  allowance  for  doubtful 
accounts was as follows: 

(In thousands)

Balance at beginning of year
Net charge to expense
Net charge-off

Fiscal
2012

$452
4
(57)

Fiscal
2011

$ 509
67
(124)

Fiscal
2010

$ 445
340
(276)

Balance at end of year

$399

$ 452

$ 509

As of April 28, 2012 and April 30, 2011, we did 
not have any customer that comprised more than 
10%  of  trade  receivables.  No  one  customer 
accounted for more than 10% of net sales during 
any of the last three fiscal years. 

Use  of  Estimates  The  preparation  of  financial 
statements  in  conformity  with  generally  accepted 
accounting  principles  requires  management  to 
make  estimates  and  assumptions  that  affect  the 
amounts  reported  in  the  financial  statements  and 
accompanying  notes.  Although  these  estimates 
are based on management’s knowledge of current 
events  and  anticipated  future  actions,  actual 
results may vary from reported amounts.

2 .  PR O PER T Y,  PL AN T  AN D  EQ UIPM EN T

Property, plant and equipment as of April 28, 2012 
and April 30, 2011 consisted of the following:

(In thousands)

2012

2011

Land
Buildings and improvements
Machinery and equipment

$ 

9,779
48,363
136,019

$  9,779
47,374
132,709

Total
194,161
Less accumulated depreciation (137,432)

189,862
(134,525)

Property, plant and  
  equipment—net

$  56,729

$  55,337

Depreciation  expense  was  $8.5  million  for 
Fiscal 2012, $9.3 million for Fiscal 2011 and $10.3 
million for Fiscal 2010. 

3.  ACCRUED  L IAB ILI T IE S

Accrued liabilities as of April 28, 2012 and April 30, 
2011 consisted of the following:

(In thousands)

Accrued compensation
Accrued promotions
Accrued insurance
Other

Total

2012

2011

$  9,252
5,450
1,621
4,956

$  9,862
7,130
2,078
7,144

$ 21,279

$ 26,214

26

N a t i on a l  B e v er a g e  C or p.

(cid:31)(cid:31)(cid:31)4.  D EB T

At  April  28,  2012,  a  subsidiary  of  the  Company 
maintained  unsecured  revolving  credit  facilities 
with  banks  aggregating  $75  million  (the  “Credit  
Facilities”).  The  Credit  Facilities  expire  through  
July 8, 2013 and, currently, any borrowings would 
bear interest at .3% to .9% above LIBOR or, at our 
election,  .5%  below  the  banks’  reference  rate.  At 
April  28,  2012,  $2.4  million  of  the  Credit  Facilities 
was  used  for  standby  letters  of  credit  and  $72.6 
million was available for borrowings. 

The  Credit  Facilities  require  the  subsidiary  to 
maintain certain financial ratios, principally debt to 
net  worth  and  debt  to  EBITDA  (as  defined  in  the 
loan  agreements),  and  contain  other  restrictions, 
none  of  which  are  expected  to  have  a  material 
effect  on  our  operations  or  financial  position.  At 
April 28, 2012, we were in compliance with all loan 
covenants  and  approximately  $1.2  million  of 
retained earnings was restricted from distribution. 

5.  C API TAL  S TO CK  AN D  T R ANSAC T I O NS   W I T H 
R EL AT ED  PAR T IE S

The  Company  paid  special  cash  dividends  of 
$106.3 million ($2.30 per share) on February 14, 
2011  and  $62.3  million  ($1.35  per  share)  on 
January 22, 2010. 

In April 2012, the Board of Directors authorized 
an  increase  in  the  Company’s  Stock  Buyback 
Program  from  800,000  to  1.6  million  shares  of 
common  stock.  As  of  April  28,  2012,  502,060 
shares  were  purchased  under  the  program  and 
1,097,940  shares  were  available  for  purchase. 
There  were  no  shares  purchased  during  the  last 
three fiscal years.

The  Company  is  a  party  to  a  management 
agreement with Corporate Management Advisors, 
Inc. (“CMA”), a corporation owned by our Chairman 
and  Chief  Executive  Officer.  This  agreement  was 
originated  in  1991  for  the  efficient  use  of 
management of two public companies at the time. 
In  1994,  one  of  those  public  entities,  through  a 
merger,  no  longer  was  managed  in  this  manner. 

Under the terms of the agreement, CMA provides, 
subject  to  the  direction  and  supervision  of  the 
Board  of  Directors  of  the  Company,  (i)  senior 
corporate  functions  (including  supervision  of  the 
Company’s  financial,  legal,  executive  recruitment, 
internal audit and management information systems 
departments)  as  well  as  the  services  of  a  Chief 
Executive  Officer  and  Chief  Financial  Officer,  and 
(ii)  services  in  connection  with  acquisitions, 
dispositions  and  financings  by  the  Company, 
including  identifying  and  profiling  acquisition 
candidates,  negotiating  and  structuring  potential 
transactions and arranging financing for any such 
transaction.  CMA,  through  its  personnel,  also 
provides,  to  the  extent  possible,  the  stimulus  and 
creativity  to  develop  an  innovative  and  dynamic 
persona  for  the  Company,  its  products  and 
corporate  image.  In  order  to  fulfill  its  obligations 
under the management agreement, CMA employs 
numerous  individuals,  whom,  acting  as  a  unit, 
provide  management,  administrative  and  creative 
functions  for  the  Company.  The  management 
agreement  provides  that  the  Company  will  pay 
CMA  an  annual  base  fee  equal  to  one  percent  of 
the  consolidated  net  sales  of  the  Company,  and 
further provides that the Compensation and Stock 
Option Committee and the Board of Directors may 
from  time  to  time  award  additional  incentive 
compensation  to  CMA.  While  our  sales  from 
inception  of  this  agreement  have  increased  63% 
and  enterprise  value  has  increased  896%,  no 
incentive  compensation  has  been  paid.  We 
incurred management fees to CMA of $6.3 million 
for  Fiscal  2012,  $6.0  million  for  Fiscal  2011  and 
$5.9  million  for  Fiscal  2010.  Included  in  accounts 
payable were amounts due CMA of $3.0 million at 
April 28, 2012.

6 .  D ER I VAT I V E  FINAN CIAL  INS T RUM EN T S

We  have  entered  into  various  aluminum  swap 
contracts  to  partially  mitigate  our  exposure  to 
changes  in  the  cost  of  aluminum  cans  through 
April  2013.  The  financial  instruments  were 

2012  A n n u a l  R e p or t

27

(cid:31)(cid:31)(cid:31)Notes to Consolidated Financial Statements (continued)

designated  and  accounted  for  as  a  cash  flow 
hedge. Accordingly, gains or losses attributable to 
the  effective  portion  of  the  cash  flow  hedge  are 
reported  in  Accumulated  Other  Comprehensive 
Income  (“AOCI”)  and  reclassified  into  earnings 
through  cost  of  sales  in  the  period  in  which  the 
hedged transaction affects earnings. The ineffective 
portion of the change in fair value of our cash flow 
hedge  was  immaterial.  The  following  summarizes 
the  gains  (losses)  recognized  in  the  Consolidated 
Statements  of  Income  and  AOCI  relative  to  the 
cash flow hedge:

(In thousands)

Recognized in AOCI—
(Loss) gain before  
income taxes

  Less income tax  

Fiscal
2012

Fiscal
2011

Fiscal 
2010

$ (4,484) $ 3,650

$603

(benefit) provision

(1,642)

1,299

  Net

(2,842)

2,351

214

389

Reclassified from AOCI to  
  cost of sales—
  Gain (loss) before  
income taxes

  Less income tax  

  provision (benefit)

  Net

290

(617)

599

69

221

(220)

(397)

213

386

Net change to AOCI

$ (3,063) $ 2,748

$    3

As  of  April  28,  2012,  the  notional  amount  of 
our  outstanding  aluminum  swap  contracts  was 
$21.7  million  and,  assuming  no  change  in  the 
commodity prices, $503,000 of unrealized net loss 
(before  tax)  will  be  reclassified  from  AOCI  and 
recognized  in  earnings  over  the  next  twelve 
months. See Note 1. 

As  of  April  28,  2012,  the  fair  value  of  the 
derivative  liability  was  $503,000,  which  was 
included in Accrued liabilities. As of April 30, 2011, 
the  fair  value  of  the  derivative  asset  was  $4.3 

million,  which  was  included  in  Prepaid  and  other 
assets. Such valuation does not entail a significant 
amount of judgment and the inputs that are significant 
to the fair value measurement are Level 2 in the fair 
value  hierarchy  as  they  are  observable  market 
based  inputs  or  unobservable  inputs  that  are 
corroborated by market data. 

7.   OT H ER  E X PENSE

Other expense (income) consisted of the following:

Fiscal
2012

Fiscal
2011

Fiscal
2010

$ (69)

$ (140) $ (229)

7
147

82
78

291
289

$  85

$  20

$ 351

(In thousands)

Interest income
Loss on disposal of  
  property, net
Other

Total

8 .  IN CO M E  TA X E S

The provision (benefit) for income taxes consisted 
of the following: 

(In thousands)

Current
Deferred

Total

Fiscal
2012

Fiscal
2011

Fiscal
2010

$23,380
(477)

$ 22,590
(694)

$19,558 
(1,026)

$22,903

$ 21,896

$18,532

Deferred taxes are recorded to give recognition 
to temporary differences between the tax bases of 
assets  or  liabilities  and  their  reported  amounts  in 
the  financial  statements.  Valuation  allowances  are 
established  to  reduce  the  carrying  amounts  of 
deferred tax assets when it is deemed, more likely 
than not, that the benefit of deferred tax assets will 
not  be  realized.  Deferred  tax  assets  and  liabilities 

28

N a t i on a l  B e v er a g e  C or p.

(cid:31)(cid:31)(cid:31) 
 
 
 
 
 
 
 
 
as of April 28, 2012 and April 30, 2011 consisted of 
the following:

included  in  “Other  liabilities”  in  the  accompanying 
consolidated balance sheets, is as follows: 

(In thousands)

2012

2011

Deferred tax assets:
  Accrued expenses and other

Inventory and amortizable assets

$  5,173
450

$  4,893
497

  Total deferred tax assets

5,623

5,390

Deferred tax liabilities:
  Property

Intangibles and other

16,186
101

16,889
1,556

  Total deferred tax liabilities

16,287

18,445

Net deferred tax liabilities

$ 10,664

$ 13,055

Current deferred tax assets—net

$  3,550

$  1,493

Noncurrent deferred tax  

liabilities—net

$ 14,214

$ 14,548

The reconciliation of the statutory federal income 

tax rate to our effective tax rate is as follows:

Fiscal
2012

Fiscal
2011

Fiscal
2010

Statutory federal income  

tax rate

35.0% 35.0% 35.0%

State income taxes, net of  

federal benefit

2.7

2.4

2.8

Manufacturing deduction  
  benefit
Other differences

(3.1)
(.4)

(3.0)
.5

(2.0)
.3

Effective income tax rate

34.2% 34.9% 36.1%

As  of  April  28,  2012,  the  gross  amount  of 
unrecognized  tax  benefits  was  $4.5  million,  of 
which  $89,000  was  recognized  as  tax  benefit  in 
Fiscal  2012.  If  we  were  to  prevail  on  all  uncertain 
tax  positions,  the  net  effect  would  be  to  reduce 
our  tax  expense  by  approximately  $3.6  million.  A 
reconciliation of the changes in the gross amount 
of  unrecognized  tax  benefits,  which  amounts  are  

(In thousands)

Beginning balance
Increases due to current  
  period tax positions
Decreases due to lapse  
  of statute of limitations

Fiscal
2012

Fiscal
2011

Fiscal
2010

$4,687

$3,997

$3,662

408

857

391

(547)

(167)

(56)

Ending balance

$4,548

$4,687

$3,997

We  recognize  accrued  interest  and  penalties 
related to unrecognized tax benefits in income tax 
expense.  As  of  April  28,  2012,  unrecognized  tax 
benefits included accrued interest of $540,000, of 
which approximately $20,000 was recognized as a 
tax benefit in Fiscal 2012. 

We file annual income tax returns in the United 
States and in various state and local jurisdictions. 
A number of years may elapse before an uncertain 
tax  position,  for  which  we  have  unrecognized  tax 
benefits,  is  resolved.  While  it  is  often  difficult  to 
predict the final outcome or the timing of resolution 
of any particular uncertain tax position, we believe 
that our unrecognized tax benefits reflect the most 
probable outcome. We adjust these unrecognized 
tax benefits, as well as the related interest, in light 
of changing facts and circumstances. The resolution 
of  any  particular  uncertain  tax  position  could 
require the use of cash and an adjustment to our 
provision for income taxes in the period of resolution. 
Federal  income  tax  returns  for  fiscal  years 
subsequent  to  2007  are  subject  to  examination. 
Generally,  the  income  tax  returns  for  the  various 
state  jurisdictions  are  subject  to  examination  for 
fiscal years ending after fiscal 2007. 

2012  A n n u a l  R e p or t

29

(cid:31)(cid:31)(cid:31) 
 
 
 
 
 
Notes to Consolidated Financial Statements (continued)

9.  S TO CK- BA SED  CO M PENSAT I O N

Our  stock-based  compensation  program  is  a 
broad-based  program  designed  to  attract  and 
retain  employees  while  also  aligning  employees’ 
interests with the interests of the stockholders.

The  1991  Omnibus  Incentive  Plan  (the 
“Omnibus Plan”) provides for compensatory awards 
consisting of (i) stock options or stock awards for 
up to 4,800,000 shares of common stock, (ii) stock 
appreciation  rights,  dividend  equivalents,  other 
stock-based  awards  in  amounts  up  to  4,800,000 
shares  of  common  stock  and  (iii)  performance 
awards  consisting  of  any  combination  of  the 
above.  The  Omnibus  Plan  is  designed  to  provide 
an  incentive  to  officers  and  certain  other  key 
employees and consultants by making available to 
them  an  opportunity  to  acquire  a  proprietary 
interest  or  to  increase  such  interest  in  National 
Beverage. The number of shares or options which 
may  be  issued  under  stock-based  awards  to  an 
individual  is  limited  to  1,680,000  during  any  year. 
Awards may be granted for no cash consideration 
or  such  minimal  cash  consideration  as  may  be 
required by law. Options generally have an exercise 
price equal to the fair market value of our common 
stock  on  the  date  of  grant,  vest  over  a  five-year 
period and expire after ten years.

The  Special  Stock  Option  Plan  provides  for 
the issuance of stock options to purchase up to an 
aggregate of 1,800,000 shares of common stock. 
Options may be granted for such consideration as 
determined by the Board of Directors. The vesting 
schedule  and  exercise  price  of  these  options  are 
tied  to  the  recipient’s  ownership  level  of  common 
stock  and  the  terms  generally  allow  for  the 
reduction  in  exercise  price  upon  each  vesting 
period. Also, the Board of Directors authorized the 
issuance  of  options  to  purchase  up  to  50,000 
shares  of  common  stock  to  be  issued  at  the 
direction of the Chairman.

The Key Employee Equity Partnership Program 
(“KEEP  Program”)  provides  for  the  granting  of 
stock options to purchase up to 240,000 shares of 
common  stock  to  key  employees,  consultants, 
directors  and  officers.  Participants  who  purchase 
shares of stock in the open market receive grants  
of  stock  options  equal  to  50%  of  the  number  of 
shares  purchased,  up  to  a  maximum  of  6,000 
shares  in  any  two-year  period.  Options  under  the 
KEEP Program are forfeited in the event of the sale 
of  shares  used  to  acquire  such  options.  Options 
are  granted  at  an  initial  exercise  price  of  60%  of 
the  purchase  price  paid  for  the  shares  acquired 
and  the  exercise  price  reduces  to  the  stock  par 
value at the end of the six-year vesting period. 

We  account  for  stock  options  under  the  fair 
value method of accounting using a Black-Scholes 
valuation  model  to  estimate  the  stock  option  fair 
value  at  date  of  grant.  The  fair  value  of  stock 
options  is  amortized  to  expense  over  the  vesting 
period.  Stock  options  granted  were  3,000  KEEP 
shares  in  Fiscal  2012,  301,500  shares  in  Fiscal 
2011  and  3,000  KEEP  shares  in  Fiscal  2010.  The 
weighted  average  Black-Scholes  fair  value 
assumptions  for  stock  options  granted  are  as 
follows: weighted average expected life of 8 years 
for  Fiscal  2012,  7.5  years  for  Fiscal  2011  and  8 
years for Fiscal 2010; weighted average expected 
volatility of 42.9% for Fiscal 2012, 48.6% for Fiscal 
2011 and 52.2% for Fiscal 2010; weighted average 
risk  free  interest  rates  of  2.5%  for  Fiscal  2012, 
2.8% for Fiscal 2011 and 3.4% for Fiscal 2010; and 
expected  dividend  yield  of  5.3%  for  Fiscal  2012, 
4.3% for Fiscal 2011 and 4% for Fiscal 2010. The 
expected  life  of  stock  options  was  estimated 
based  on  historical  experience.  The  expected 
volatility  was  estimated  based  on  historical  stock 
prices  for  a  period  consistent  with  the  expected 
life of stock options. The risk free interest rate was 
based  on  the  U.S.  Treasury  constant  maturity 
interest  rate  whose  term  is  consistent  with  the 
expected  life  of  stock  options.  Forfeitures  were 
estimated based on historical experience.

30

N a t i on a l  B e v er a g e  C or p.

(cid:31)(cid:31)(cid:31)The  following  is  a  summary  of  stock  option 

activity for Fiscal 2012:

Number of 
Shares

Price (a)

Options outstanding, beginning  
  of year
Granted
Exercised
Cancelled

601,620
3,000
(59,420)
(32,580)

Options outstanding, end of year

512,620

Options exercisable, end of year

252,677

$7.51
6.14
1.94
9.14

7.24

5.27

(a) Weighted average exercise price.

Stock-based  compensation  expense  was 
$290,000 for Fiscal 2012, $446,000 for Fiscal 2011 
and  $349,000  for  Fiscal  2010.  The  total  fair  value 
of  shares  vested  was  $513,000  for  Fiscal  2012, 
$135,000  for  Fiscal  2011  and  $402,000  for  Fiscal 
2010.  The  total  intrinsic  value  for  stock  options 
exercised was $758,000 for Fiscal 2012, $799,000 
for Fiscal 2011 and $1,498,000 for Fiscal 2010. Net 
cash proceeds from the exercise of stock options 
were $115,000 for Fiscal 2012, $209,000 for Fiscal 
2011  and  $266,000  for  Fiscal  2010.  Stock-based 
income  tax  benefits  aggregated  $295,000  for 
Fiscal 2012, $921,000 for Fiscal 2011 and $384,000 
for Fiscal 2010. The weighted average fair value for 
stock  options  granted  was  $8.16  for  Fiscal  2012, 
$6.35 for Fiscal 2011 and $7.43 for Fiscal 2010.

As of April 28, 2012, unrecognized compensation 
expense  related  to  the  unvested  portion  of  our 
stock  options  was  $636,000,  which  is  expected  
to  be  recognized  over  a  weighted  average  period 
of  3.4  years.  The  weighted  average  remaining 
contractual term and the aggregate intrinsic value 
for  options  outstanding  as  of  April  28,  2012  was  

5.1 years and $3.8 million, respectively. The weighted 
average  remaining  contractual  term  and  the 
aggregate intrinsic value for options exercisable as 
of  April  28,  2012  was  4.0  years  and  $2.4  million, 
respectively.

We have a stock purchase plan which provides 
for  the  purchase  of  up  to  1,536,000  shares  of 
common  stock  by  employees  who  (i)  have  been 
employed  for  at  least  two  years,  (ii)  are  not  part-
time  employees  and  (iii)  are  not  owners  of  five 
percent  or  more  of  National  Beverage  common 
stock.  As  of  April  28,  2012,  no  shares  have  been 
issued under the plan.

10.  PENSI O N  PL ANS

The Company contributes to certain pension plans 
under  collective  bargaining  agreements  and  to  a 
discretionary profit sharing plan. Total contributions 
(including  contributions  to  multi-employer  plans 
reflected below) were $2.5 million for Fiscal 2012, 
$2.5  million  for  Fiscal  2011  and  $2.3  million  for 
Fiscal 2010. 

The  Company  participates  in  various  multi-
employer  defined  benefit  pension  plans  covering 
certain employees whose employment is covered 
under collective bargaining agreements. Under the 
Pension  Protection  Act  (“PPA”),  if  a  participating 
employer  stops  contributing  to  the  plan,  the 
unfunded obligations of the plan may be borne by 
the  remaining  participating  employers.  If  the 
Company  chooses  to  stop  participating  in  the 
multi-employer  plan,  the  Company  could  be 
required to pay the plan a withdrawal liability based 
on the underfunded status of the plan. 

2012  A n n u a l  R e p or t

31

(cid:31)(cid:31)(cid:31) 
 
Notes to Consolidated Financial Statements (continued)

Summarized below is certain information regarding the Company’s participation in significant multi-
employer  pension  plans  including  the  financial  improvement  plan  or  rehabilitation  plan  status  (“FIP/RP 
Status”). The most recent PPA zone status available in Fiscal 2012 and Fiscal 2011 is for the plan’s years 
ending December 31, 2010 and 2009, respectively. 

Pension Fund

PPA Zone Status

Fiscal
2012

Fiscal
2011

FIP/RP Status

Surcharge
Imposed

Central States, Southeast and Southwest Areas Pension Plan

(EIN no. 36-6044243) (the “CSSS Fund”) 

Red

Red

Implemented

Western Conference of Teamsters Pension Trust Fund

(EIN no. 91-6145047) (the “WCT Fund”)

Green Green Not applicable

Yes

No

For the plan years ended December 31, 2010 
and December 31, 2009, respectively, the Company 
was not listed in the pension trust fund forms 5500 
as providing more than 5% of the total contributions 
for the plans. The collective bargaining agreements 
covering  the  above  pension  trust  funds  expire  on 
October 18, 2016 for the CSSS Fund and May 14, 
2016 for the WCT Fund.

The  Company’s  contributions  for  all  multi-
employer  pension  plans  for  the  last  three  fiscal 
years are as follows:

(In thousands)

CSSS Fund
WCT Fund
Other multi-employer  
  pension funds

Fiscal
2012

$  944
455

Fiscal
2011

Fiscal
2010

$  897
612

$  840
505

244

224

194

Total

$ 1,643

$ 1,733

$ 1,539

11.  CO M M I TM EN T S  AN D  CO N T IN G EN CIE S

We  lease  buildings,  machinery  and  equipment 
under  various  non-cancelable  operating  lease 
agreements  expiring  at  various  dates  through 
2020.  Certain  of  these  leases  contain  scheduled 
rent increases and/or renewal options. Contractual 
rent  increases  are  taken  into  account  when 
calculating  the  minimum  lease  payment  and  

recognized  on  a  straight-line  basis  over  the  
lease term. Rent expense under operating lease 
agreements  totaled  approximately  $9.3  million  for 
Fiscal 2012, $10.0 million for Fiscal 2011 and $8.9 
million for Fiscal 2010.

Our  minimum  lease  payments  under  non-
cancelable  operating  leases  as  of  April  28,  2012 
were as follows: 

(In thousands)

Fiscal 2013
Fiscal 2014
Fiscal 2015
Fiscal 2016
Fiscal 2017
Thereafter

Total minimum lease payments

$  4,261
2,925
2,226
1,987
1,686
3,376

$ 16,461

As of April 28, 2012, we guaranteed the residual 
value of certain leased equipment in the amount of 
$7.1 million. If the proceeds from the sale of such 
equipment  are  less  than  the  balance  required  by 
the lease when the lease terminates July 31, 2012, 
the Company shall be required to pay the difference 
up  to  such  guaranteed  amount.  The  Company 
expects to have no loss on such guarantee. 

32

N a t i on a l  B e v er a g e  C or p.

(cid:31)(cid:31)(cid:31) 
 
 
 
 
 
 
We enter into various agreements with suppliers 
for  the  purchase  of  raw  materials,  the  terms  of 
which  may  include  variable  or  fixed  pricing  and 
minimum purchase quantities. As of April 28, 2012, 
we  had  purchase  commitments  for  raw  materials 
of  $57.8  million  for  Fiscal  2013  and  $45.0  million 
for Fiscal 2014.

From  time  to  time,  we  are  a  party  to  various 
litigation  matters  arising  in  the  ordinary  course  of 
business. We do not expect the ultimate disposition 
of  such  matters  to  have  a  material  adverse  effect 
on our consolidated financial position or results of 
operations.

12 .  Q UAR T ER LY  FINAN CIAL  DATA  (UN AUD I T ED)

(In thousands, except per share amounts) 

FI S C A L  2 012
Net sales
Gross profit
Net income
Net income per share—basic
Net income per share—diluted

FI S C A L  2 011
Net sales
Gross profit
Net income
Net income per share—basic
Net income per share—diluted

First 
Quarter

Second
Quarter

Third
Quarter

Fourth
Quarter

$ 169,080
61,074
13,435
.29
.29

$ 
$ 

$ 157,974
54,103
11,123
.24
.24

$ 
$ 

$ 136,401
45,235
7,904
.17
.17

$ 
$ 

$ 165,431
52,845
11,531
.25
.25

$ 
$ 

$ 165,030
58,488
12,053
.26
.26

$ 
$ 

$ 151,127
56,355
10,207
.22
.22

$ 
$ 

$ 131,926
49,530
7,407
.16
.16

$ 
$ 

$152,110
54,281
11,087
.24
.24

$ 
$ 

2012  A n n u a l  R e p or t

33

(cid:31)(cid:31)(cid:31)Report of Independent Registered Public Accounting Firm

To the Board of Directors and Shareholders of
National Beverage Corp. 

We  have  audited  the  accompanying  consolidated 
balance sheets of National Beverage Corp. as of April 28, 
2012  and  April  30,  2011  and  the  related  consolidated 
statements  of  income,  shareholders’  equity  and  cash 
flows  for  each  of  the  years  in  the  three-year  period 
ended  April  28,  2012.  We  also  have  audited  National 
Beverage Corp.’s internal control over financial reporting 
as  of  April  28,  2012,  based  on  criteria  established  in 
Internal  Control—Integrated  Framework  issued  by  the 
Committee of Sponsoring Organizations of the Treadway 
Commission  (COSO).  National  Beverage  Corp.’s 
management is responsible for these financial statements, 
for  maintaining  effective  internal  control  over  financial 
reporting and for its assessment of the  effectiveness of 
internal control over financial reporting. Our responsibility 
is  to  express  an  opinion  on  these  financial  statements 
and an opinion on the Company’s internal control over 
financial reporting based on our audits.

We  conducted  our  audits  in  accordance  with  the 
standards of the Public Company Accounting Oversight 
Board (United States). Those standards require that we 
plan  and  perform  the  audits  to  obtain  reasonable 
assurance  about  whether  the  financial  statements  are 
free  of  material  misstatement  and  whether  effective 
internal  control  over  financial  reporting  was  maintained 
in  all  material  respects.  Our  audits  of  the  financial 
statements  included  examining,  on  a  test  basis, 
evidence supporting the amounts and disclosures in the 
financial  statements,  assessing  the  accounting 
principles  used  and  significant  estimates  made  by 
management  and  evaluating  the  overall  financial 
statement  presentation.  Our  audit  of  internal  control 
included  obtaining  an 
over 
understanding of internal control over financial reporting, 
assessing the risk that a material weakness exists and 
testing  and  evaluating  the  design  and  operating 
effectiveness of internal control based on the assessed 
risk.  Our  audits  also  included  performing  such  other 
procedures  as  we  considered  necessary  in  the 
circumstances.  We  believe  that  our  audits  provide  a 
reasonable basis for our opinions.

financial  reporting 

A company’s internal control over financial reporting 
is a process designed to provide reasonable assurance 
regarding  the  reliability  of  financial  reporting  and  the 
preparation of financial statements for external purposes  

in  accordance  with  generally  accepted  accounting 
principles.  A  company’s  internal  control  over  financial 
reporting  includes  those  policies  and  procedures  that  
(1)  pertain  to  the  maintenance  of  records  that,  in 
reasonable  detail,  accurately  and  fairly  reflect  the 
transactions  and  dispositions  of  the  assets  of  the 
company;  (2)  provide  reasonable  assurance  that 
transactions  are  recorded  as  necessary  to  permit 
preparation  of  financial  statements  in  accordance  with 
generally  accepted  accounting  principles  and  that 
receipts  and  expenditures  of  the  company  are  being 
made  only  in  accordance  with  authorizations  of 
management  and  directors  of  the  company;  and  (3) 
provide  reasonable  assurance  regarding  prevention  or 
timely  detection  of  unauthorized  acquisition,  use,  or 
disposition  of  the  company’s  assets  that  could  have  a 
material effect on the financial statements.

Because  of  its  inherent  limitations,  internal  control 
over  financial  reporting  may  not  prevent  or  detect 
misstatements.  Also,  projections  of  any  evaluation  of 
effectiveness  to  future  periods  are  subject  to  the  risk 
that  controls  may  become  inadequate  because  of 
changes in conditions, or that the degree of compliance 
with the policies or procedures may deteriorate.

In  our  opinion,  the  financial  statements  referred  to 
above present fairly, in all material respects, the financial 
position of National Beverage Corp. as of April 28, 2012 
and April 30, 2011 and the results of its operations and 
its  cash  flows  for  each  of  the  years  in  the  three-year 
period  ended  April  28,  2012,  in  conformity  with 
accounting  principles  generally  accepted  in  the  United 
States  of  America.  Also  in  our  opinion,  National 
Beverage  Corp.  maintained,  in  all  material  respects, 
effective  internal  control  over  financial  reporting  as  
of  April  28,  2012,  based  on  criteria  established  in  
Internal  Control—Integrated  Framework  issued  by  the 
Committee of Sponsoring Organizations of the Treadway 
Commission (COSO).

McGladrey LLP
West Palm Beach, Florida
July 12, 2012

34

N a t i on a l  B e v er a g e  C or p.

(cid:31)(cid:31)(cid:31) 
 
 
 
Market for Registrant’s Common Equity, Related Stockholder Matters and 
Issuer Purchases of Equity Securities

The  common  stock  of  National  Beverage  Corp., 
par  value  $.01  per  share,  (“Common  Stock”)  is 
listed on The NASDAQ Global Select Market under 
the  symbol  “FIZZ.”  The  following  table  shows  the 
range  of  high  and  low  prices  per  share  of  the 
Common Stock for the fiscal quarters indicated: 

Fiscal Year Ended

April 28, 2012
Low
High

April 30, 2011
Low
High

First Quarter
$15.52
Second Quarter $17.76
Third Quarter
$17.72
Fourth Quarter
$17.03

$13.41
$13.77
$15.60
$13.30

$14.41
$15.23
$15.45
$14.69

$10.77
$12.32
$12.44
$12.30

At  July  3,  2012,  there  were  approximately 
6,000 holders of our Common Stock, the majority 
of which hold their shares in the names of various 
dealers and/or clearing agencies.

The  Company  paid  special  cash  dividends  of 
$106.3  million  ($2.30  per  share)  on  February  14, 
2011  and  $62.3  million  ($1.35  per  share)  on 
January  22,  2010.  See  Note  4  of  Notes  to 
Consolidated  Financial  Statements  for  certain 
restrictions on the payment of dividends. 

In April 2012, the Board of Directors authorized 
an  increase  in  the  Company’s  Stock  Buyback 
Program  from  800,000  to  1.6  million  shares  of 
Common  Stock.  As  of  April  28,  2012,  502,060 
shares  were  purchased  under  the  program  and 
1,097,940  shares  were  available  for  purchase. 
There  were  no  shares  purchased  during  the  last 
three fiscal years.

2012  A n n u a l  R e p or t

35

(cid:31)(cid:31)(cid:31)Performance Graph

The following graph shows a comparison of the five-year cumulative returns of an investment of $100 
cash on April 28, 2007, assuming reinvestment of dividends, in (i) our Common Stock, (ii) the NASDAQ 
Composite Index and (iii) a company-constructed peer group consisting of Coca-Cola Bottling Company 
Consolidated  and  Cott  Corporation.  Based  on  the  cumulative  total  return  below,  an  investment  in  our 
Common  Stock  on  April  28,  2007  provided  a  compounded  annual  return  of  approximately  9.2%  as  of 
April 28, 2012.

Comparison of 5-Year Cumulative Total Return
among National Beverage Corp., the NASDAQ Composite Index, and a Peer Group

$180

$160

$140

$120

$100

$80

$60

$40

$20

0

4/28/07

5/3/08

5/2/09

5/1/10

4/30/11

4/28/12

National Beverage

NASDAQ Composite

Peer Group

National Beverage Corp.
NASDAQ Composite
Peer Group

180

160

4/28/07

5/3/08

5/2/09

5/1/10

4/30/11

4/28/12

$100.00
100.00
100.00

$65.86
92.99
38.26

$85.65
68.86
38.99

$104.98
97.61
63.95

$147.50
118.78
74.62

$155.55
122.43
61.14  

140

120

100

80

60

40

20

0

4/28/07

5/3/08

5/2/09

5/1/10

4/30/11

4/28/12

36

N a t i on a l  B e v er a g e  C or p.

(cid:31)(cid:31)(cid:31)Subsidiaries
BevCo Sales, Inc.
Beverage Corporation Intl., Inc.
Big Shot Beverages, Inc.
Everfresh Beverages, Inc.
Faygo Beverages, Inc.
Home Juice Corp.
National Beverage Vending 

Company

National Retail Brands, Inc.
NewBevCo, Inc.
NutraFizz Products Corp.
PACO, Inc.
Shasta Beverages, Inc.
Shasta Beverages Intl., Inc.
Shasta Sales, Inc.
Shasta Sweetener Corp.
Shasta West, Inc.
Sundance Beverage Company

Corporate Offices
8100 Southwest Tenth Street
Fort Lauderdale, FL 33324
954-581-0922

Annual Meeting
The Annual Meeting of 
 Share holders will be held on 
Friday, October 5, 2012 at  
2:00 p.m. local time at the  
Hyatt Regency Orlando 
International Airport,  
9300 Jeff Fuqua Boulevard, 
Orlando, FL 32827

Financial and   
Other Information
Copies of National Beverage 
Corp.’s Annual Report, Annual 
Report on Form 10-K and  
supplemental quarterly  finan cial 
data are available free of charge 
on our website or contact  
our Shareholder Relations 
department at the Company’s 
corporate address or at 
877-NBC-FIZZ (877-622-3499).

Earnings and other financial 
results, corporate news and 
other Company information  
are available on National 
Beverage’s website at  
www.nationalbeverage.com

Stock Exchange Listing
Common Stock is listed on  
The NASDAQ Global Select 
Market—symbol FIZZ.

Transfer Agent and Registrar
Computershare
480 Washington Boulevard
Jersey City, NJ 07310-1900
888-313-1476
www.cpushareownerservices.com

Independent Registered   
Public Accounting Firm
McGladrey LLP
West Palm Beach, FL

National Beverage Corp.
Corporate Data

Directors
Nick A. Caporella
Chairman of the Board &  
Chief Executive Officer
National Beverage Corp.

Joseph G. Caporella
President
National Beverage Corp.

Cecil D. Conlee*
Founding Partner
CGR Advisors

Samuel C. Hathorn, Jr.*
Retired Chief Executive Officer
Trendmaker Development Co.

Joseph P. Klock, Jr., Esq.*
Partner
Rasco, Klock, Reininger, Perez, 

Esquenazi, Vigil & Nieto

Stanley M. Sheridan*
Retired President
Faygo Beverages, Inc.

*Member Audit Committee

Corporate Management
Nick A. Caporella
Chairman of the Board &  
Chief Executive Officer

Joseph G. Caporella
President

George R. Bracken
Executive Vice President– 

Finance

Dean A. McCoy
Senior Vice President &  

Chief Accounting Officer

Gregory P. Cook
Vice President–Controller

Brent R. Bott
Executive Director– 

Consumer Marketing

Gregory J. Kwederis
Executive Director– 
Beverage Analyst

Timothy C. Barker
Senior Director–Strategic IT

Vanessa C. Walker
Senior Director– 

Strategic Brand Management

Richard S. Berkes
Director– 

Risk Management

Glenn G. Bryan
Director–Tax

Subsidiary Management
Dennis L. Thompson
President
BevCo Sales, Inc.

John R. Hagan
Senior Executive Vice President– 

Chief Operating Officer

Shasta Beverages, Inc.

Michael J. Bahr
Executive Vice President
Shasta West, Inc.

Alan A. Chittaro
Executive Vice President
Faygo Beverages, Inc.

Alan D. Domzalski
Executive Vice President
Sundance Beverage Company

Brian M. Gaggin
Executive Vice President
National Retail Brands, Inc.

Charles A. Maier
Executive Vice President
Foodservice
Shasta Sales, Inc.

John F. Hlebica
Vice President
Shasta Beverages Intl., Inc.

Worth B. Shuman III
Vice President
Military Sales

Martin J. Rose
General Manager
Shasta Vending

Annual Report Design by Curran & Connors, Inc. / www.curran-connors.com

National Beverage Corp.

8100 Southwest tenth Street / Fort lauderdale, Florida 33324

954.581.0922 / www.nationalbeverage.com