Exhibit 99.1
November 13, 2007
Tofutti Press Release
Company Contact: Steve Kass
Chief Financial Officer
(908) 272-2400
(908) 272-9492 (Fax)
TOFUTTI ANNOUNCES THIRD QUARTER RESULTS
Cranford, New Jersey -- November 13, 2007-- TOFUTTI BRANDS INC. (AMEX
Symbol: TOF) today announced its results for the thirteen and thirty-nine week
periods ended September 29, 2007.
The Company reported net sales for the thirteen week period ended
September 29, 2007 of $4.6 million, a decrease of $332,000, or 7%, from the
sales recorded for the thirteen weeks ended September 30, 2006. Net sales for
the thirty-nine week period ended September 29, 2007 decreased 3% to $14.3
million compared with net sales of $15.1 million for the thirty-nine week period
ended September 30, 2006. The decline in sales was caused by the disruption
arising from the closure of our former frozen novelty manufacturing facility in
early May and our relocating that production site to another facility. This
required us to postpone the shipment of certain large orders that would have
been shipped in the second quarter and third quarters until later in the third
and fourth quarters and to allocate existing inventory of novelty products among
all our customers, further negatively impacting our sales for the period.
For the thirteen and thirty-nine week periods ended September 29, 2007,
the Company reported income before income taxes of $202,000 and $802,000,
respectively, as compared with income before income taxes of $437,000 and $1.1
million for the thirteen and thirty-nine week periods in 2006. The Company's
operating results continued to be negatively impacted as a result of new product
start-up costs, costs incurred at new co-packaging locations, increased
selling and warehouse expenses and higher packaging charges. The Company expects
that its operating expenses will continue to be affected by these same factors
during the remainder of 2007.
The Company recorded net income of $127,000 ($0.02 per share on a basic
and diluted basis) for the thirteen weeks ended September 29, 2007 compared to
$287,000 ($0.05 per share on a basic and diluted basis) for the thirteen weeks
ended September 30, 2006. Net income for the thirty-nine weeks ended September
29, 2006 was $480,000 ($0.09 per share on a basic basis and $0.08 per share on a
diluted basis) compared to $654,000 ($0.12 per share on a basic basis and $0.11
per share on a diluted basis) for the thirty-nine weeks ended September 30,
2006.
As of September 29, 2007 the Company had cash and cash equivalents of
$1.0 million and working capital of $4.5 million compared to cash and cash
equivalents of $289,000 and working capital of $4.0 million at December 31,
2006. The improvement in the Company's cash position and working capital is due
to our purchasing fewer of the ingredients and less of the packaging used in the
production of our frozen dessert products, as these purchases are being made by
our new novelty co-packer.
Mr. David Mintz, Chairman and Chief Executive Officer of the Company
stated, "Our shipments continued to be affected by the disruptions caused by our
transfer of novelty frozen dessert production to a new facility in the late
spring. We believe that we have substantially resolved the issues concerning our
production requirements and that our shipments will return to prior levels in
the fourth quarter."
TOFUTTI BRANDS INC. is principally involved in the development,
production and marketing of TOFUTTI brand soy-based, dairy-free frozen desserts,
soy-based dairy free cheese products and other soy-based, dairy-free food
products. TOFUTTI products are sold in grocery stores,
supermarkets, health and convenience stores throughout the United States and in
approximately twenty-five other countries.
Some of the statements in this press release concerning the Company's
future prospects are forward-looking statements that involve risks and
uncertainties that could cause actual results to differ materially from those in
the forward-looking statements. Actual results may vary significantly based upon
a number of factors including, but not limited to business conditions both
domestic and international, competition, changes in product mix or distribution
channels, resource constraints encountered in promoting and developing new
products and other risk factors detailed in the Company's filings with the
Securities and Exchange Commission, including its annual report on Form 10-KSB.
TOFUTTI BRANDS INC.
Condensed Statements of Operations
(in thousands, except per share figures)
Thirteen weeks Thirteen weeks Thirty-nine Thirty-nine
ended ended weeks ended weeks ended
Sept. 29, 2007 Sept. 30, 2006 Sept. 30, 2007 Sept. 30, 2006
-------------- -------------- -------------- --------------
Net sales............................... $4,616 $4,948 $14,258 $15,110
Cost of sales........................... 3,395 3,442 9,940 10,757
----- ----- ----- ------
Gross profit............................ 1,221 1,506 4,318 4,353
Operating expenses...................... 1,019 1,069 3,516 3,298
----- ----- ----- -----
Income before income taxes.............. 202 437 802 1,055
Income taxes............................ 75 150 322 401
--- --- --- ---
Net income ............................. $127 $287 $480 $654
==== ==== ==== ====
Net income per share:
Basic.......................... $0.02 $0.05 $0.09 $0.12
===== ===== ===== =====
Diluted........................ $0.02 $0.05 $0.08 $0.11
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Weighted average number of shares
outstanding:
Basic.......................... 5,653 5,433 5,609 5,434
===== ===== ===== =====
Diluted........................ 5,919 5,987 5,877 5,993
===== ===== ===== =====
TOFUTTI BRANDS INC.
Condensed Balance Sheets
(in thousands, except for share amounts)
September 29, December 30,
2007 2006
------------ ------------
(unaudited)
Assets
Current assets:
Cash and cash equivalents $1,045 $ 289
Accounts receivable, net of allowance for doubtful
accounts of $298 and $243, respectively 2,653 2,084
Inventories 1,440 2,992
Prepaid expenses and other receivables 10 2
Deferred income taxes 578 558
--- ---
Total current assets 5,726 5,925
----- -----
Fixed assets (net of accumulated depreciation of
$23 and $19) 25 29
Other assets 16 16
-- --
$5,767 $5,970
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Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable $369 $711
Accrued expenses 172 277
Accrued officers' compensation 200 500
Income taxes payable 517 472
--- ---
Total current liabilities 1,258 1,960
----- -----
Stockholders' equity:
Preferred stock - par value $.01 per share;
authorized 100,000 shares, none issued -- --
Common stock - par value $.01 per share;
authorized 15,000,000 shares, issued and
outstanding 5,653,467 shares at September 29, 2007
and 5,433,467 shares at December 30, 2006 57 54
Additional paid-in capital 222 56
Retained earnings 4,230 3,900
----- -----
Total stockholders' equity 4,509 4,010
----- -----
Total liabilities and stockholders' equity $5,767 $5,970
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