Add
JJSF to Portfolio
Set Alert
Email to a
Friend
| |||
|
|
Quotes & Info
|
| JJSF > SEC Filings for JJSF > Form 10-Q on 23-Apr-2009 | All Recent SEC Filings |
23-Apr-2009
Quarterly Report
Liquidity and Capital Resources
Our current cash balances and cash expected to be provided by future operations are our primary sources of liquidity. We believe that these sources, along with our borrowing capacity, are sufficient to fund future growth and expansion. See Note 10 to these financial statements for a discussion of our investment securities.
The Company's Board of Directors declared a regular quarterly cash dividend of $.0975 per share of its common stock payable on April 2, 2009 to shareholders of record as of the close of business on March 16, 2009.
In the six months ended March 28, 2009, we purchased and retired 450,597 shares of our common stock at a cost of $12,510,000 under a million share buyback authorization approved by the Company's Board of Directors in February 2008 leaving 414,279 as the number of shares that may yet be purchased under the share buyback authorization. We did not purchase any shares in the three months ended March 28, 2009. We purchased and retired 135,124 shares at a cost of $3,539,000 in our fiscal year ended September 27, 2008. Of the shares purchased and retired in this year's six months, 400,000 shares were purchased at the purchase price of $27.90 per share from Gerald B. Shreiber, Chairman of the Board, Chief Executive Officer and Director of the Company.
In the three months ended March 28, 2009 and March 29, 2008, fluctuations in the valuation of the Mexican and Canadian currencies and the resulting translation of the net assets of our Mexican and Canadian subsidiaries caused an increase of $444,000 and a decrease of $95,000, respectively, in accumulated other comprehensive loss. In the six month periods, there was an increase of $1,881,000 in fiscal year 2009 and a decrease of $146,000 in fiscal year 2008.
On January 9, 2007 we acquired the assets of Hom/Ade Foods, Inc., a manufacturer and distributor of biscuits and dumplings sold under the MARY B'S and private label store brands to the supermarket industry. Hom/Ade, headquartered in Pensacola, Florida, had prior annual sales of approximately $30 million.
On January 31, 2007 we acquired the assets of Radar Inc., a manufacturer and seller of fig and fruit bars selling its products under the brand DADDY RAY'S. Headquartered and with its manufacturing facility in Moscow Mills, MO (outside of St. Louis), Radar, Inc. had prior annual sales of approximately $23 million selling to the retail grocery segment and mass merchandisers, both branded and private label.
On April 2, 2007, we acquired the WHOLE FRUIT Sorbet and FRUIT-A-FREEZE Fruit Bar brands, along with related assets. Selling primarily to the supermarket industry, sales for 2007 were less than $2 million.
On June 25, 2007, we acquired the assets of an ICEE distributor in Kansas with annual sales of less than $1 million.
These acquisitions were accounted for under the purchase method of accounting, and their operations are included in the consolidated financial statements from their respective acquisition dates.
Our general-purpose bank credit line which expires in December 2011 provides for up to a $50,000,000 revolving credit facility. The agreement contains restrictive covenants and requires commitment fees in accordance with standard banking practice. There were no outstanding balances under this facility at March 28, 2009.
Results of Operations
Net sales increased $5,123,000 or 4% for the three months to $149,352,000 and $15,367,000 or 6% to $290,494,000 for the six months ended March 28, 2009 compared to the three and six months ended March 29, 2008.
FOOD SERVICE
Sales to food service customers increased $5,031,000 or 5% in the second quarter to $99,914,000 and increased $13,157,000 or 7% for the six months. Soft pretzel sales to the food service market decreased 1% to $24,853,000 in the second quarter and increased 1% to $49,088,000 in the six months. Unit sales of soft pretzels declined about 6% in the quarter and were down 7% for the six months. Italian ice and frozen juice treat and dessert sales increased 4% to $10,990,000 in the three months and 3% to $19,256,000 in the six months. Churro sales to food service customers increased 16% to $7,408,000 in the second quarter and were up 24% to $14,764,000 in the six months, with about 75% of the increase in both periods coming from sales to one customer. Sales of bakery products, excluding biscuit and dumpling sales and fruit and fig bar sales, increased $1,933,000 or 5% in the second quarter to $39,192,000 and increased $5,460,000 or 7% for the six months due primarily to increased sales to private label customers. Biscuit and dumpling sales decreased 4% to $7,967,000 in the quarter and were up 2% to $17,659,000 for the six months. Sales of fig and fruit bars increased 23% in the second quarter to $7,585,000 and increased 24% in the six months to $14,443,000 due to strong volume growth. The changes in sales throughout the food service segment were from a combination of volume changes and price increases.
RETAIL SUPERMARKETS
Sales of products to retail supermarkets increased $519,000 or 4% to $13,529,000 in the second quarter and were essentially unchanged at $23,562,000 in the first half. Soft pretzel sales for the second quarter were up 5% to $8,241,000 and were up less than 1 percent to $15,083,000 for the six months on a unit volume decline of 6% for the quarter and 12% for the six months. Higher selling prices offset the unit volume declines. Sales of frozen juices and ices increased $56,000 or 1% to $5,746,000 in the second quarter and were down 3% to $9,328,000 in the first half on a unit volume increase of 18% in the quarter and 7% for the six months. Increased trade spending for the introduction of new frozen novelty items reduced sales dollars in relation to the unit volume increases.
THE RESTAURANT GROUP
Sales of our Restaurant Group decreased 17% to $319,000 in the second quarter and 23% to $752,000 for the six month period. The sales decreases were caused primarily by the closing of unprofitable stores over the past year. Sales of stores open for both year's six months were down about 3% from last year.
FROZEN BEVERAGES
Frozen beverage and related product sales decreased 1% to $35,590,000 in the second quarter and increased $2,521,000 or 4% to $68,731,000 in the six month period. Beverage sales alone increased 2% to $22,148,000 in the second quarter and were up 3% to $42,223,000 in the six months. Excluding a change in program structure for one customer which resulted in higher sales and higher cost of sales and operating expenses, beverage sales alone would have been down less than one-half of one percent for both periods. Gallon sales were up 1% for the three months and down 1% for the six months in our base ICEE business. Service revenue increased 11% to $9,810,000 in the second quarter and 21% to $20,360,000 for the six months. Sales of frozen carbonated beverage machines were $1,565,000 lower this year than last in the three month period and for the six months, sales of machines were lower by $1,732,000.
CONSOLIDATED
Gross profit as a percentage of sales increased to 30.38% in the three month period from 28.01% last year and increased to 29.63% in the six month period from 27.54% a year ago. Lower commodity costs in excess of $1,500,000, higher pricing and increased efficiencies due to volume in some of our product lines were the primary drivers causing the gross profit percentage increase for the quarter. For the six months, commodity costs were about $1,000,000 higher than last year but higher pricing and volume efficiencies resulted in the gross profit percentage increase.
Total operating expenses decreased $1,223,000 in the second quarter and as a percentage of sales decreased to 22% from 24% last year. For the first half, operating expenses decreased $423,000 and as a percentage of sales decreased to 23% from 25% last year. Marketing expenses decreased from 12% to 11% of sales in the quarter and six months. Lower spending in our food service and frozen beverages segments accounted for the decline in the quarter and lower spending in our food service segment accounted for the decline for the six months. Distribution expenses declined to 8% in both periods this year from 9% in both periods last year due to lower fuel and freight costs. Administrative expenses were 4% of sales in all periods.
Operating income increased $6,200,000 or 109% to $11,880,000 in the second quarter and $10,695,000 or 133% to $18,711,000 in the first half. Operating income was impacted by higher group health insurance costs of about $900,000 in the six month period.
Investment income decreased by $391,000 and $744,000 in the second quarter and six months, respectively, due to a general decline in the level of interest rates and the movement of our investments to lower risk securities. We expect this trend to continue for the foreseeable future.
The effective income tax rate has been estimated at 40% for both periods this year compared to 37% for last year's quarter and 38% for last year's six months. The increase is due to a lower amount of tax advantaged investment income and higher state taxes this year and because of the recognition of previously unrecognized tax benefits in last year's second quarter.
Net earnings increased $3,246,000 or 81% in the current three month period to $7,244,000 and increased 96% to $11,563,000 in the six months this year from $5,895,000 last year.
|
|