Exhibit 99.1
FOR IMMEDIATE RELEASE |
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Inventure Foods Reports First Quarter 2013 Results
PHOENIX — May 2, 2013 — Inventure Foods, Inc. (Nasdaq: SNAK), a leading specialty food marketer and manufacturer, today reported financial results for the first quarter ended March 30, 2013 highlighted by quarterly net revenues of $48.5 million.
First Quarter Overview
For the first quarter of 2013 compared to the first quarter of 2012:
· Net revenues increased 3.2% to $48.5 million.
· Gross profit decreased 5.6% to $8.8 million, or 18.2% of net revenues.
· Diluted earnings per share were $0.05.
· EBITDA decreased 23.0% to $3.1 million.
· Amended an existing credit agreement to extend the term and increase the capacity, while providing more favorable terms with the lending bank, U.S. Bank.
Quarter Overview
Consolidated net revenues for the first quarter were $48.5 million, an increase of 3.2%, compared to $47.0 million during the prior-year period. Comparability of our current period net revenues were affected by the prior year sale of the DSD business. Excluding the impact of the sale of the DSD business, our consolidated revenues were up 5.8%. Net revenues during the first quarter of 2013 were supported by a 15.3% growth in the healthy/natural portfolio over the prior-year period. Gross profit decreased 5.6% to $8.8 million, compared to $9.3 million in the prior-year period. Gross profit margin declined 170 basis points to 18.2% from 19.9% last year primarily due to a decrease in sales of in our T.G.I. Friday’s® products in the Snack segment. Selling, general and administrative expenses increased 50 basis points to 14.3% of net revenues compared to 13.8% last year primarily due to sampling expenses incurred for a non-recurring mass merchandiser event for our T.G.I. Friday’s® brand. Net income decreased 38.7% to $1.1 million, resulting in a corresponding decrease in fully diluted earnings per share to $0.05, and EBITDA decreased 23.0%, to $3.1 million, or 6.4% of net revenues.
Frozen segment net revenues totaled $26.6 million for the quarter, an increase of 16.8% over the prior-year period. Net revenues of frozen berries increased 21.4% for the quarter due to continued sales growth of our branded frozen fruit. Jamba® net revenues decreased 8.7% to $3.2 million for the quarter, largely attributed to timing of temporary rotations in the club channel. Excluding the club channel, Jamba® net revenues increased 25.4% for the quarter.
Snack segment net revenues of $21.9 million in the quarter were down 9.5%, compared to $24.2 million during the prior-year period. Snack segment net revenues in the current year were also affected by the prior year sale of the DSD business. Excluding the impact of the sale of the DSD business, our Snack segment revenues were down 5.0%. T.G.I. Friday’s® net revenues decreased 16.1% during the quarter, which were partially offset by a 12.8% increase in sales of Boulder Canyon Natural Foods® and a 17.3% increase in sales of premium private label products.
Management Commentary & Future Outlook
“We experienced some disappointments in our first quarter results, largely driven by a slowing in the T.G.I. Friday’s brand and increased brand investment, which we referred to in our last call, resulting in lower than expected earnings for the quarter. However, we maintain our outlook to achieve positive revenue and earnings growth for the full year,” said Terry McDaniel Chief Executive Officer of Inventure Foods, Inc.
Inventure Foods, Inc. 5415 E. High Street, Suite 350 Phoenix, AZ 85054 (623) 932-6200 Fax (602) 522-2690
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“We continue to see strong growth in our healthy/natural portfolio of products, which now makes up 68% of total net revenues. Our healthy/natural portfolio net revenues grew due to sustained demand for our frozen fruit products and continued growth of our Boulder Canyon products. Our Boulder Canyon brand generated its highest quarterly net revenues this quarter, which is reflective of our dedicated team’s effort the past several months. We also began shipping and incurring brand investments for our Seattle’s Best Coffee frozen coffee blends to select retailers near the end of the first quarter. We remain optimistic about the incremental benefits this new product line will bring as we continue our phased roll out.”
“With our newly restructured debt agreement, we are well positioned to fund new acquisitions and future growth. This includes our recently announced plan to purchase Oregon based berry processing business, Willamette Valley Fruit Company. This proposed acquisition will help us meet growing consumer demand for berries and will bring additional operational synergies. This will also provide additional freezing capabilities, packaging capacities and a presence in another geographic location. Other future growth opportunities underway include a large national co-packing partnership agreement with a highly reputable snack food company. More details surrounding this agreement are anticipated to be announced in the second quarter,” concluded McDaniel.
Conference Call
Inventure Foods’ executive management team will host a conference call today at 11 a.m. ET to discuss the Company’s first quarter 2013 results and comment on its future outlook. To participate in the conference call, please call (877) 853-7702 toll-free, or (408) 940-3848 for international callers. A live webcast of the call will also be available at www.inventurefoods.com and will be archived for one year following today’s event.
About Inventure Foods, Inc.
With manufacturing facilities in Arizona, Indiana and Washington, Inventure Foods, Inc. (Nasdaq: SNAK) is a marketer and manufacturer of specialty food brands in better-for-you and indulgent categories under a variety of Company owned and licensed brand names, including Boulder Canyon Natural Foods®, Jamba®, Seattle’s Best Coffee®, Rader Farms®, T.G.I. Friday’s®, Nathan’s Famous®, Vidalia Brands®, Poore Brothers®, Tato Skins® and Bob’s Texas Style®. For further information about Inventure Foods, please visit www.inventurefoods.com.
Statements contained in this press release that are not historical facts are forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. Because such statements include risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements. Factors that may cause actual results to differ from the forward-looking statements contained in this press release and that may affect the Company’s prospects in general include, but are not limited to, general economic conditions, increases in cost or availability of ingredients, packaging, energy and employees, price competition and industry consolidation, ability to execute strategic initiatives, product recalls or safety concerns, disruptions of supply chain or information technology systems, customer acceptance of new products and changes in consumer preferences, food industry and regulatory factors, interest rate risks, dependence upon major customers, dependence upon existing and future license agreements, the possibility that we will need additional financing due to future operating losses or in order to implement the Company’s business strategy, acquisition and divestiture-related risks, the volatility of the market price of the Company’s common stock, and such other factors as are described in the Company’s filings with the Securities and Exchange Commission.
INVENTURE FOODS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share data)
(unaudited)
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| Quarter Ended |
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| March 30, |
| March 31, |
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Net revenues |
| $ | 48,537 |
| $ | 47,020 |
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Cost of revenues |
| 39,712 |
| 37,675 |
| ||
Gross profit |
| 8,825 |
| 9,345 |
| ||
Selling, general & administrative expenses |
| 6,957 |
| 6,501 |
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Operating income |
| 1,868 |
| 2,844 |
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Interest expense, net |
| 220 |
| 230 |
| ||
Income before income taxes |
| 1,648 |
| 2,614 |
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Income tax provision |
| 592 |
| 892 |
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Net income |
| $ | 1,056 |
| $ | 1,722 |
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Earnings per common share: |
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Basic |
| $ | 0.05 |
| $ | 0.09 |
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Diluted |
| $ | 0.05 |
| $ | 0.09 |
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Weighted average number of common shares: |
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|
|
|
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Basic |
| 19,206 |
| 18,282 |
| ||
Diluted |
| 19,694 |
| 19,365 |
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INVENTURE FOODS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
|
| March 30, |
| December 29, |
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| (unaudited) |
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Assets |
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Current assets: |
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Cash and cash equivalents |
| $ | 4,589 |
| $ | 419 |
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Accounts receivable, net |
| 17,752 |
| 17,547 |
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Inventories |
| 22,073 |
| 27,071 |
| ||
Deferred income tax asset |
| 873 |
| 1,030 |
| ||
Other current assets |
| 1,318 |
| 1,323 |
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Total current assets |
| 46,605 |
| 47,390 |
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Property and equipment, net |
| 36,267 |
| 34,051 |
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Goodwill |
| 11,616 |
| 11,616 |
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Trademarks and other intangibles, net |
| 2,007 |
| 2,010 |
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Other assets |
| 876 |
| 827 |
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Total assets |
| $ | 97,371 |
| $ | 95,894 |
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Liabilities and Shareholders’ Equity |
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Current liabilities: |
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Accounts payable |
| $ | 15,262 |
| $ | 12,178 |
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Accrued liabilities |
| 7,563 |
| 8,415 |
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Current portion of long-term debt |
| 2,770 |
| 1,646 |
| ||
Total current liabilities |
| 25,595 |
| 22,239 |
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Long-term debt, less current portion |
| 13,862 |
| 6,897 |
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Line of credit |
| — |
| 10,117 |
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Deferred income tax liability |
| 4,002 |
| 3,968 |
| ||
Interest rate swaps |
| 711 |
| 766 |
| ||
Other liabilities |
| 850 |
| 808 |
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Total liabilities |
| 45,020 |
| 44,795 |
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Shareholders’ equity: |
|
|
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Common stock |
| 196 |
| 196 |
| ||
Additional paid-in capital |
| 29,822 |
| 29,660 |
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Accumulated other comprehensive loss |
| (344 | ) | (378 | ) | ||
Retained earnings |
| 23,148 |
| 22,092 |
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|
| 52,822 |
| 51,570 |
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Less: treasury stock |
| (471 | ) | (471 | ) | ||
Total shareholders’ equity |
| 52,351 |
| 51,099 |
| ||
Total liabilities and shareholders’ equity |
| $ | 97,371 |
| $ | 95,894 |
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INVENTURE FOODS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
RECONCILIATION
(in thousands)
(unaudited)
|
| Quarter Ended |
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| March 30, |
| March 31, |
| ||
Reconciliation — EBITDA(1): |
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|
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Net income |
| $ | 1,056 |
| $ | 1,722 |
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Interest, net |
| 220 |
| 230 |
| ||
Income tax provision |
| 592 |
| 892 |
| ||
Depreciation |
| 1,213 |
| 1,149 |
| ||
Amortization of intangible assets |
| 2 |
| 11 |
| ||
EBITDA |
| $ | 3,083 |
| $ | 4,004 |
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(1) EBITDA is presented as a supplemental performance measure and is not intended as an alternative to net income or any other measure calculated in accordance with generally accepted accounting principles. Further, EBITDA may not be comparable to similarly titled measures used by other companies.
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