EXHIBIT 99.1
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JOHN B. SANFILIPPO & SON, INC.
NEWS RELEASE
COMPANY CONTACT: Michael J. Valentine
Executive Vice President Finance and Chief
Financial Officer
847-871-6509
FOR IMMEDIATE RELEASE
TUESDAY, JANUARY 27, 2004
Second Quarter Basic EPS of $1.12 Exceeds Previous Second Quarter EPS
Record of $.90
Second Quarter Net Sales Increases 24% Over 2003 Second Quarter Net Sales
Year-to-Date Earnings increase 78% and Net Sales increase 27% vs. Last Year
Elk Grove Village, IL, January 27, 2004 -- John B. Sanfilippo & Son,
Inc. (Nasdaq: JBSS) today announced record operating results for the
second quarter of fiscal 2004, ended December 25, 2003. Net income
was approximately $10.4 million or $1.12 per share basic ($1.09 per
share diluted) versus net income of $8.2 million or $.90 per share
basic ($.89 per share diluted) for the second quarter of fiscal 2003.
Current year to date net income was also record setting at
approximately $17.6 million or $1.88 per share basic ($1.85 per share
diluted) compared to approximately $9.9 million or $1.08 per share
basic ($1.07 per share diluted) for the same period in fiscal 2003.
In the second quarter, the Company reclassified its freight expense
presentation, previously shown as a reduction in net sales, to selling
expenses to conform to existing accounting guidance. The Company
believes that this reclassification will enhance the comparability of
its financial information with the financial information of other
companies that are in similar industries. This reclassification had
no effect upon the Company's financial condition or its income,
including operating income, net income and earnings per share. The
information set forth below gives effect to the reclassification.
Net sales grew significantly to approximately $171.4 million in the
second quarter of fiscal 2004 from net sales of approximately $138.1
million in the second quarter of fiscal 2003. The 24.1 percent
increase in net sales was attributable to sizeable gains in the
consumer, industrial, food service and export distribution channels
during the second quarter. The gross profit, as a percentage of net
sales, rose from 19.1 percent for the second quarter of fiscal 2003 to
19.4 percent for the current quarter. Gross profit, as a percentage of
net sales, was favorably impacted because the price decline in the
pecan market, which the Company anticipated in the first quarter, did
not materialize. The gross profit margin further increased as unit
volume sales increased
while certain costs of sales remained fixed. Fiscal year to date net
sales grew from $233.4 million in fiscal 2003 to $296.2 million in
fiscal 2004. The 26.9 percent increase in net sales was fueled
primarily by a 35 percent increase in sales through the industrial
channel, a 27 percent increase in sales through the consumer channel,
and a 29 percent increase in sales through the food service channel.
Gross profit, as a percentage of net sales, was 19.8 percent for the
first twenty-six weeks of fiscal 2004, which was up from 17.0 percent
for the same period in fiscal 2003. The improvement in gross profit
margin for the first twenty-six weeks of fiscal 2004 was mainly
attributable to unit volume sales increases while certain costs of
sales remained fixed, lower peanut cost and better than expected
results in the Company's pecan shelling operation which led to a
quantity increase in the pecan inventory.
As a percentage of net sales, selling and administrative expenses were
9.0 percent for the second quarter of fiscal 2004 versus 8.6 percent
for the second quarter of fiscal 2003. For the current year to date
period, selling and administrative expenses were 9.5 percent of net
sales versus 9.2 percent of net sales for the same period in fiscal
2003. For both the quarter and the first twenty-six weeks of fiscal
2004, the increase in selling and administrative expense, as a
percentage of net sales, was mainly attributable to an increase in
incentive based compensation attributable to improved operating
results and increased legal and professional fees.
For the second quarter of fiscal 2004, operating income was 10.4
percent of net sales versus 10.5 percent of net sales for the second
quarter of fiscal 2003. Current year to date operating income
advanced from 7.8 percent of net sales in fiscal 2003 to 10.3 percent
of net sales.
Interest expense for the second quarter of fiscal 2004 was
approximately $.9 million compared to approximately $1.1 million for
the second quarter of fiscal 2003. Interest expense for the current
year to date period was approximately $1.9 million versus
approximately $2.3 million for the first two quarters of fiscal 2003.
Scheduled payments of long-term debt, made during both the current
quarter and the year to date period led to the reduction in interest
expense.
Subsequent to the issuance of the Company's quarterly financial
statements on Form 10-Q for the quarter ended September 25, 2003, and
the Company's annual financial statements on Form 10-K for the fiscal
years ended June 26, 2003, June 27, 2002 and June 28, 2001, the
Company determined that its freight costs, which had been recorded as
a reduction in net sales should be classified as an operating expense
in accordance with the guidance of Emerging Issues Task Force No. 00-
10, "Accounting for Shipping and Handling Fees and Costs."
Consequently, the Company has amended and restated its financial
statements included in its most recent annual report on Form 10-K and
quarterly report on Form 10-Q for the first quarter of fiscal 2004 and
has filed those amended reports on Forms 10-K/A and 10-Q/A.with the
Security and Exchange Commission on January 26, 2004. These changes
had no effect on the Company's financial condition, changes in
financial condition or results of operations, including income from
operations, net income and earnings per share for the periods
mentioned above.
John B. Sanfilippo & Son, Inc. is a processor, packager, marketer and
distributor of shelled and in-shell nuts and sesame sticks that are
sold under a variety of private labels and under the company's
Fisher, Chef's Naturals, Evon's, Snack 'N Serve Nut Bowl, Sunshine
Country, Flavor Tree and Texas Pride brand names. The company also
markets and distributes a diverse product line of other food and snack
items.
The factors that could negatively impact future results are: (i)
sales activity for the Company's products; (ii) changes in the
availability and costs of raw materials for the production of the
Company's products; (iii) fluctuations in the value of the Company's
inventories of pecans, walnuts, almonds, peanuts or other nuts due to
fluctuations in the market prices of these nuts; (iv) the Company's
ability to lessen the negative impact of competitive pressures by
reducing its selling prices and increasing sales volume while at the
same time maintaining profit margins by reducing costs; (v) the
outcome of a pending governmental antitrust investigation of the
peanut shelling industry; and (vi) the timing and occurrence (or
nonoccurrence) of other transactions and events which may be subject
to circumstances beyond the Company's control.
JOHN B. SANFILIPPO & SON, INC.
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CONSOLIDATED STATEMENTS OF OPERATIONS
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(Dollars in thousands, except earnings per share)
For the Quarter Ended For the Twenty-six Weeks Ended
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(Unaudited) (Unaudited)
December 25, December 26, December 25, December 26,
2003 2002 2003 2002
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Net sales $171,392 $138,107 $296,153 $233,434
Cost of sales 138,173 111,678 237,441 193,705
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Gross profit 33,219 26,429 58,712 39,729
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Selling expenses 11,265 9,702 20,296 16,811
Administrative expenses 4,090 2,244 7,933 4,617
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15,355 11,946 28,229 21,428
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Income from operations 17,864 14,483 30,483 18,301
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Other income (expense):
Interest expense (855) (1,104) (1,850) (2,282)
Rental income 119 133 237 244
Miscellaneous 1 1 1 1
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(735) (970) (1,612) (2,037)
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Income before income taxes 17,129 13,513 28,871 16,264
Income tax expense 6,680 5,270 11,260 6,343
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Net income $10,449 $8,243 $17,611 $9,921
========= ========= ========= =========
Basic earnings per share $1.12 $0.90 $1.88 $1.08
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Diluted earnings per share $1.09 $0.89 $1.85 $1.07
========= ========= ========= =========
Weighted average shares
outstanding
-- basic 9,361,091 9,153,790 9,344,988 9,153,627
========= ========= ========= =========
-- diluted 9,589,340 9,268,126 9,534,810 9,239,735
========= ========= ========= =========
JOHN B. SANFILIPPO & SON, INC.
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CONSOLIDATED BALANCE SHEETS
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(Dollars in thousands)
(Unaudited)
December 25, June 26,
2003 2003
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ASSETS
CURRENT ASSETS:
Cash $1,764 $2,448
Accounts receivable, net 50,339 29,142
Inventories 139,885 112,016
Deferred income taxes 1,290 1,257
Income taxes receivable -- 469
Prepaid expenses and other
current assets 2,091 2,192
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195,369 147,524
PROPERTIES, NET 68,895 67,117
OTHER ASSETS 8,392 9,086
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$272,656 $223,727
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<Unaudited)
December 25, June 26,
2003 2003
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LIABILITIES & STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Notes payable $20,373 $29,702
Current maturities of long-term debt 10,817 10,776
Accounts payable 51,871 13,658
Drafts payable 13,007 5,507
Accrued expenses 12,306 12,699
Income taxes payable 2,854 --
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111,228 72,342
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LONG-TERM DEBT 21,139 29,640
LONG-TERM DEFERRED INCOME TAXES 2,958 2,964
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24,097 32,604
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STOCKHOLDERS' EQUITY:
Class A common stock 37 37
Common stock 58 58
Capital in excess of par value 59,850 58,911
Retained earnings 78,590 60,979
Treasury stock (1,204) (1,204)
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137,331 118,781
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$272,656 $223,727
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