J & J Snack Foods Announces Down Earnings

J & J Snack Foods Corp. (NASDAQ:JJSF) today announced record sales but lower earnings for the first quarter ended December 29, 2007.

Sales increased 15% to $130.9 million from $114.1 million in last year’s first quarter. Net earnings decreased 50% to $1.9 million in the current quarter from $3.8 million last year. Earnings per diluted share were $.10 for the first quarter compared to $.20 last year. Operating income decreased 55% to $2.3 million in the current quarter from $5.1 million in the year ago quarter.

Gerald B. Shreiber, J & J’s President and Chief Executive Officer, commented, “The unprecedented escalation in commodity costs including both wheat and dairy impacted this quarter. Given the current environment and expected lack of substantial relief, this will continue to pressure earnings in the future. We are committed to managing our business for the long term and maintaining our market share and presence. We are gratified to have grown our sales by 15% during this difficult environment.”

J & J Snack Foods Corp.’s principal products include SUPERPRETZEL, PRETZEL FILLERS and other soft pretzels, ICEE, SLUSH PUPPIE and ARCTIC BLAST frozen beverages, LUIGI’S, MAMA TISH’S, SHAPE UPS, MINUTE MAID* and BARQ’S** and CHILL*** frozen juice bars and ices, WHOLE FRUIT sorbet, FRUIT-A-FREEZE frozen fruit bars, MARY B’S biscuits and dumplings, DADDY RAY’S fig and fruit bars, TIO PEPE’S churros, THE FUNNEL CAKE FACTORY funnel cakes, and MRS. GOODCOOKIE, CAMDEN CREEK, COUNTRY HOME and READI-BAKE cookies. J & J has manufacturing facilities in Pennsauken, Bridgeport and Bellmawr, New Jersey; Scranton, Hatfield and Chambersburg, Pennsylvania; Carrollton, Texas; Atlanta, Georgia; Moscow Mills, Missouri; Pensacola, Florida and Vernon and Newport, California.

*MINUTE MAID is a registered trademark of The Coca-Cola Company.

**BARQ’S is a registered trademark of Barq’s Inc.

***CHILL is a registered trademark of Wells Dairy, Inc.

 

Consolidated Statement of Operations

Three Months Ended

December 29,

 

December 30,

2007

2006

(unaudited)

(in thousands)

 

Net sales

$

130,898

$

114,142

Cost of goods sold

 

95,511

 

78,894

Gross profit

35,387

35,248

Operating expenses

 

33,051

 

30,113

Operating income

2,336

5,135

Other income

 

779

 

956

Earnings before income taxes

3,115

6,091

Income taxes

 

1,218

 

2,286

Net earnings

$

1,897

$

3,805

 

Earnings per diluted share

$

.10

$

.20

Earnings per basic share

$

.10

$

.21

Weighted average number of diluted shares

19,076

18,895

Weighted average number of basic shares

18,769

18,539

 

 

Consolidated Balance Sheets

December 29, 2007

 

September 29, 2007

(unaudited)

(in thousands)

 

Current assets

$

157,971

$

165,364

Property, plant & equipment, net

94,218

93,222

Goodwill

60,314

60,314

Other intangibles, net

57,141

58,333

Other assets

 

3,013

 

3,055

Total

$

372,657

$

380,288

 

Current liabilities

$

55,399

$

64,601

Long-term obligations under capital leases

451

474

Deferred income taxes

19,180

19,180

Other long term obligations

2,211

451

Stockholders’ equity

 

295,416

 

295,582

Total

$

372,657

$

380,288

The forward-looking statements contained herein are subject to certain risks and uncertainties that could cause actual results to differ materially from those projected in the forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect management’s analysis only as of the date hereof. The Company undertakes no obligation to publicly revise or update these forward-looking statements to reflect events or circumstances that arise after the date hereof.