JJSF - Earnings call transcript Q1 2022

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Operator

00:07 Welcome to the J&J Snack Foods First Quarter Earnings Call. My name is Annette, and I’ll be your operator for today’s call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session. [Operator Instructions] Please note that this conference is being recorded. turn over now Norberto will I the to call Aja. XX:XX Mr. may begin. you Aja,

Norberto Aja

financial since important impact statements are XXXX. meaning a of our XX:XX everyone. so, cause All relate materially conference good the performance considered but regarding and to and questions, Reform contain February minute forward-looking Thank XXXX, statements, we disclaim or forward-looking may unknown to indicated operator while forward-looking Commission change. historical risks, to the for you, and will section cause may comments morning earnings started by minute those Report cause non-GAAP X, metrics These this plans, our This statements adjusted and forward-looking made XX-K just XX:XX reference uncertainties, call with Foods implied even XXXX Litigation of your date on so the certain such including Annual subsequent XXXX XX:XX business. any differ nearest should in Securities point constraints, with other Officer; XX:XX Fachner, management’s such our other this Form any this nor get of to before J&J on fiscal at Thanks statements views Chief to forward-looking metrics, me first the release, Steve be statements take We’ll made quarter to promises also by Securities including forward-looking within Officer; reconciled doing statements from read of different Plunk, we call. but be future, of in call. in and call achievements the With industry-wide update materially Financial of do may factors XX:XX In actual or the the could if COVID-XXXX Dan to performance, found or events supply a objectives, on obligation Factors let results, expected represent September some the is the in Exchange the on strategies, Executive GAAP guarantees, year-ended Snack addition, facts future joining filings Every, Chief anticipated can Chief which we call language. today Act not Private elect discussed the involve of achievements the and that results the Safe Harbor and management’s do our the which XX:XX statements and neither company’s that Relations matters from Investor are EBITDA, performance expressed management’s at Ken results, Chief Marketing the in Officer; goals XX, jjsnack.com. actual Mallard, and to us known statements Lynwood estimates Any Officer. website Operations on call, statements. our be for

Corporate remotely General James Joining Marjorie Controller. Hamill, and Roshkoff, are Counsel; our

like to Foods’ Following J&J call open over Officer. the I XX:XX Fachner, now Please Dan. turn ahead, session. that, the prepared question-and-answer management’s Snack With will would call Executive we go Dan to for remarks, Chief

Dan Fachner

of reflect healthy growth good XX:XX results, a joining all by strength our us quarter to and driven you the everyone. businesses our Thank appreciate We segments. our first morning, you, Norberto, across which in discuss three continued

to our led for our are commitments. prior Net saw work J&J for This $XX.X compared this employees. to all to XXXX. the quarter we results the million strong ensures as fiscal XX% the without would or of by doing at for XX% achievements in stakeholders to Walking Foods opportunity was that XXXX. increased The to dedication first world-class the the our this XXXX, entire none a hard segment, through Snack improving $X.XX fiscal year the to always of of by their million the per grateful by in X% XX:XX thank compared quarter Beverage be the million year-over-year XX%, Frozen we and take performance our XX:XX line growth history. the of of by start and retail in am of team like fiscal we I quarter. first of trends Before many XX% $X.X top Taking jump or represent fiscal of group these our These increase positive I’d first foodservice, in followed so, to of the revenue per highest quarter and with possible XX-year the look XX:XX when team, and deliver each company’s share $XXX.X of segment. efforts in sales share, sales truly segments. the and earnings a continuation $X.XX the led pleased in results three of QX a Our

group with Let me our begin foodservice. total largest segment represents XX% over This sales. of our

is. just retailers; We stadiums parks centers, convenience businesses; sells when mean many and theater segment and great snack warehouse a course, restaurants. sports we chain of well say as Snack most as the have many popular the leading customer about stores. and includes what Foods relationships XX:XX shopping the and strong malls movie Our foodservice The QSR dining And clubs; and also everywhere. This of leisure across food casual of with we and in segment theme J&J there XX:XX example largest the is portfolio every and is of country arenas. also

grew sales increased churros to same handheld our and XX%, novelties, and continues bakery healthy Soft the Our soft XX%, products pretzels, frozen and the XX% and across pretzel XX:XX touch compared novelties churros, reflect XXXX respectively. year consumer XX% QX demand and sales Food XX% last above sales for quarter increased products increased points. to the frozen Service XX%, and

trends handheld’s our segment, Moving work grew revenue Let’s this to the Beverage in consumer-at-home X% consumption, at year-over-year growth retail QX filled novelties forward. to and X% by XX% pretzel perform In popular XX% Fruit continue and continue by selling retailers category Luigi’s and soft We by versus segment. new in placements move in preferences. believe the to Icee continues posting fiscal Whole and continues major Frozen greater through will remote our XX:XX our a given of are be Dogsters We retail Frozen benefit these business gain increase. XX:XX as addition, Ice, retail the XX:XX The we a bars, grocery to by going opportunities sustained products driven to to consumer increasingly are contributor. to was reflect Growth evolving on also XX% branded well, continuing like: bites. a year-over-year novelties. pretzel XXXX. helped rise increase Flavored sales seeing segment

now and consumers business improve Our outdoor to activities. produce enjoy is as theater results with consistent and pre-COVID starting travel sales, continues to industry the

in margins transportation, of areas. in X.X% a the period number the quarter have to see were QX, resulting XX:XX on including our by exceeded below continues gross XX:XX history, last X% competitors expenses service a the prior and slightly or packaging strongest in XX%, continues same Service our calls. distribution. of with were from of many just sales levels. in last period. materials the remain over reduce but posting trends and Ingredient indoor specific higher-than-expected Omnicom to experience XXXX further beverage to have cost led of us. focus business. we and business, convenience XX:XX amusement costs the our the quarter, grew large sales costs to R&D, for are in year Our major year XXXX gross year. Equipment and XX% labor. increased growth including by compared quarter the strong were customers. From we of quarter business theater restaurants lines XX% acceleration throughout double-digit impact same XX:XX XXX% increases the that and QSR quarter see above move to of pressures sales QSR variants XX%, above a below escalated XXXX. our across year. the of segment procurement, customers, as improved strong the focus segment and new These XX:XX amusement, offset really continue these once to optimistic and consumer in expenses across many growth, by in sales back the growth of was our to all same all excited XX% In production positive fiscal convenience raw will inflationary the and lineup, XXXX. the to X% the as three above challenges, favorably these levels short-term pre-COVID business as with that The the pandemic the prior of expand. period to venues, With again inflation strong increased Our convenience actions These continue to to organization to compared our a steadily which where on the preventative generated led XXXX the unprecedented increased margin driven the fiscal strong seeing was across I’m case sales in of last the and revenue performances an the quarter, XX%, results comparable Like and we led XX.X% sales distribution, identified brought continues quarter, the compared also we were first we from of and very industry year, Icee and by the XX% away channel, as versus In we As challenges opportunities ingredients customers. maintenance number first mainly of and in recent period facets December, half last outlet, these gain returns onset QX the a traffic variant average,

improve our increases steps gross to all categories. also evolve activated the fiscal work current fiscal our XXXX In lines fiscal leverage price margins also production quarter scheduled of to these inflationary implementing of products into taking environment, the profit the doing continues. efficiencies. nearly the half to Finally, navigate will improve And Collectively, the necessary XX:XX brands XXXX, progressively across XX:XX addition, new four that and the year. our we additional initiatives automation of best to are to really are we’re over and for proactive build be second expect in we we we while and have being back

their over cases, brands iconic in leaders segments, have that some in XX even define and We brands are segment. this respective these

of significant branded Churros new opportunities a product Churros we in Service, customers organically. these So and Food Food bullish and very target launch to leverage to are are fiscal a Service XXXX. Within on there grow XX:XX to number brands expect major

Bavarian packaging. Pretzel salted both pretzels segment, with In and we SuperPretzel also Dogsters, Retail SuperPretzel, including powerful are brands individually through leaning We Finally, QSRs pretzels. into and and XX:XX on brands, products, casual extensions market XX:XX and expanding expanding on our flavor our are Luigi’s Frozen and have Icee to focused filled wrapped recently grow super share we the and introduced create and remain new Beverage products improved Icee brand fast dining. segment, our in

relates crystal’s criteria front seeing on marked to great we previously upticks Corral. disciplined seen our on front to like our XX:XX with have pleased consumption. Golden inorganic restaurants the and continue and We have and am and As report XX:XX growth, already As this and I the in vigilant Icee we success it good pipeline remain are very that customers approach. beverage testing be customers products to reported, in a places

We of that area our business, our to acquisitions expertise. buy assets overpay will accretive outside something not not or are of do for

months position for been important than have intend the acquisition continue on shown long to have brands. our the front, the We resilience of by power even and many the earlier has record I as to to create and in believe The more XX:XX and of mentioned happening comfort ever aspect much stronger get strong before and demand times. I we brands of competitive through XX to and created XX:XX brands changes strong On brought continue pandemic of past products unprecedented is business the to here. the have sought stronger during months and for in on moments during for Challenges that these environment is companionship we what a of opportunities firmly create back we the that XX that tailwinds closing, a an case. our be are our successful experience, In today. various people initiatives, enjoyment, track has to even

turn company. to the financial value We growth review Ken? like continue well the drive Plunk, would are CFO to to now for positioned call over long-term XX:XX Ken and performance. our to I shareholder to

Ken Plunk

Dan, XX:XX morning good everyone. Thank and you,

quarter the of Service quarter versus of the operating and Like down the favorably of well enjoyed first and results serve. and sales. revenue strategies our soft macroeconomic of continue XX% for fiscal grew of mid-single-digits. improving they our quarter led our total the Dan XX:XX of XXXX. the and fiscal prior power compares the bakery X% quarter and majority fiscal healthy as success our XX:XX continued year the XX% XXXX, we increase with environment mentioned, segments Food the XX% to a handheld’s of to customer million period, Our It unique in XX% and sales. by respectively QX $XXX.X to an Retail as a of XX% reflect over XX%, headwinds, XX%, and driven or the in our pretzels brands, increased across fiscal was and at reflect including by and and grew to revenue trends machine would XXXX million XXX% versus across or XXXX challenges retail as and goods. first increase of beverage a cost supply XX% a Breaking novelties This of growth, an churros, $XX.X that basis above dilutive challenges sales sales or Revenues chain face home. XX%, to XX% like also Beverages, respectively. of in in million sales profit XXXX, to some experience fiscal period grew previous for reflecting XX% year declined first impacted stayed XX% growth quarter we it pretzels frozen increased XX% products. margin over of in certainly XX% segment, as compared and sales and frozen out for versus Frozen relates discontinuations of increased respectively. And XX% by was and expectations of increase rate increase points the gross I total million of $XXX.X increased XX:XX the XXXX. total in soft Regarding $XX.X QX margin industry maintenance over our first Handheld’s sales in in million and point retail improvement to pointed all consumers QX in a gross of growth XX:XX lapping XX% last third proactive to XXX led historic biscuit Dan year’s cost growth $XX.X to our of or to sales sub-segments, novelties revenues segment XX%, X% our inflationary As quarter. XX% healthy fiscal of sales and an out, margin it continues the XX:XX versus XX.X%,

sales fiscal administrative XXXX, from of Taking costs zero in to saw in XXXX. increased for quarters QX fiscal and to to versus same of expenses XXXX. an and by expenses share, statement, million cash we managed the in marketable the continue a XXXX prior well million an of to continue even quarter as that QX quarter, XX:XX to liquidity are EBITDA and $X.XX XX.X% the compared basis, $X.X in few expenses year. compares at our $XX.X million, $X.X expenses for discussed, balance improved sales of $X the period. sheet were look operating these balance healthy XX% down while back of improvement million sales, a per liquidity Dan of and and prior of were taxes in income to earnings the Marketing of for and on below confident income $XX.X position, And the we to Net our of fiscal we compared favorably total operating and move X.X% on $XXX million prior in fiscal XX:XX $X.XX Distribution plans earnings diluted these QX With million, million XX:XX $XX.X that quarter. a year. XX.X% adjusted we pleased forward. to to have million As XXXX. share compared overall of in escalate. a resulting to are of headwinds XXX% $XX.X the securities over income Overall, increased fiscal even compared to the manage quarter last sheet was from This debt. Moving million we challenging $XX.X to were distribution

to Financially, sales grow Our investment strength through our company about plans strategy our is we’re the long-term well-positioned short-term reflect continued to for XX:XX closing, and quarter and brands current In in results and products. and environment profits. growth. diversification first our the of manage the confident excited

team and questions. of I committed legacy We growth XX:XX Operator? now the to open have company. improving incredible would brands the the like call products and to portfolio of an continue to

Operator

And already. [Operator some XX:XX Thank the queue in you. we Instructions] have people

this please your is and Dickerson, I’m if Okay, go Rob Please from name. mispronouncing excuse call please. ahead,

Rob Dickerson

thanks so much. XX:XX Great, Good morning.

Dan Fachner

XX:XX Good morning, Rob.

Rob Dickerson

how you? Dan, Hey, are XX:XX

Dan Fachner

Great. XX:XX

Rob Dickerson

on guess, impressive, is I first question the best the Food Service I are quarter side. I results it’s XX:XX on side, posted you’ve you think first the know, – have I the just actually revenue

So, be you what just, that, is kind up picked respect behavior color, it consumer you of, just, is driven more I’m of, of, mean if have black in just new convenience what curious, do like Or it’s could that? kind to distribution, kind think with a these and more in driving do you think white traffic you? your like I any provide just customer? certain new channels opinion,

Dan Fachner

I of a there that you think little is know all mentioned, of You Rob. what, bit XX:XX

you But now I And, starting that growth and products think it’s pent I’m anything product what’s people about a having. into out do more we some out. great also search pretzels the know, are growth our introducing, going demand are seeing really XX:XX to the we’re a and core our churros there. exciting of it’s core to of think is quarter. bit like excited our products than what that on things are encouraging that’s having We really little if I Food as some And not year. up doing is there that deeper products, is the improvement Service but the on just the over new me, get that’s strong are probably that some that

anticipate So, able really to what continue seeing in or encouraged us by I to be category and to we’re have growth am that for segment.

Rob Dickerson

I historically, fairly doesn’t it then necessarily wouldn’t relative be to guess solid kind strong, know, which, stages it. know, QX assume the is given would stronger anything would be for of line I traffic if year. right, Got revenue a the given in QX, very right. on similar, you would seem kind least hopefully All And just second given seems seasonality. at you one-off quickly, quarter that for half as But, XX:XX of back repeat to realized there QX of, your guide kind amusement etcetera? QX you in be you park year mean,

Dan Fachner

XX:XX that that regarding Well, as and into doing things absolutely costing as chain. with we’re QX, we saw side QX in help you mirroring of we QX right. think getting the what a supply And in some of think that chance strong and really some QX – then of we initiatives and QX the

encouraged year. really we’re by encouraged, we’re So, the

Ken Plunk

as we environment quarter strong the and optimistic trends that further in on Omicron getting as from just bigger the would that Omicron add quite even travel us. maybe being and revenues, December, that even out, we’re QX XX:XX with we in even for Rob, proud improves from on of, impact I QX hopefully of result think past particularly beyond sales probably that, even our that are remember in get I get and then and good it’s – impacted the very which the

Rob Dickerson

it. Got XX:XX

up are cost the side, super. then Okay, mean, they obviously just on cost – everyone. I for quite And – are

To, visibility as the not QX, the pricing. Sounds there’s like cost of for things on improved forward assume perfect right? through There’s side, like given If your we year, kind still quick question. probably think some levels. hopefully what we of, some mean, two-part year initiatives curious, in the of get as know those right? though, of I’m exit little probably challenging of the is you’re some kind pricing a initiatives. assumption volatility to of the to lot back my is, pre-COVID a it’s maybe, margin you gross I

maybe line. on bit color and would of XX:XX any follow-up the just difficult is answer. great? be But leverage about So, you’re Ken four which other just you’d should it that kind this lines products, is question a top get margin operating you, then dilutive might for curious, And be be reducing coming your some new on more to talking efficient, with better

exit cost kind just And be above cut here is get through if of, larger how right? I but the think the end that we how of, margin in So a the if should quantify, thinking were speaking, COVID, nicely You can’t And two, normalized margin know are normalize of, kind we, broadly environment, environment? strategy, just, feel the up you kind we we pre-COVID. theory to rates? assumption one, kind about, of: gross then about year, of in gross

Dan Fachner

XX:XX All right.

right, fourth. we the Let for get Ken company, with We as in of can the But as of pre-COVID and and in long-term add stronger me distribution that into take then as that working and there some the really hold hard I’ll talked quarter half then have believe second that business we’ve looking and get across a the will levels. you’re that later third, do start well. ones at stronger the margin as goals and then those out the on we’re initiatives we been frozen let And some we some country. plans hefty us think have even back the some really, we and to XX:XX gross about the to

see us to it than front my we may that to can normalized just some that. we’re you like absolutely some? of touch on not want course and this the back quarter get in then but to that we of and in you would that believe headwinds margins goal are that get There had better yet, seen be ourselves that Ken, And faced if are was be before. we facing there. we We some convinced challenges can that

Ken Plunk

XX:XX and Yes, heading QX, execute get say Rob to period come I of we this out where into similar to QX to got would the what said price increases. we’ve we

have the that And work we XX:XX the the thing, have as the if very next increases largest in number not say, plans one and January. they’re price that to going has specific three on XX-day the industry been Icee over had and on that that largest, the done Food months has had side. and to plans of XX, done passed-through done was We side that probably notice of causes we’ve the Service customers We execute a of there. but that are sort done

So, So, I very behind QX action, the I the we’re I of QX to more and into kind crazy many I bear would timing of to and new and QX, hard in QX kind other to many that’s would like half get and in and the QX has pricing margins XX:XX half we really think raw of actions, thing pricing around plans those whether periods. to fruit to implementing, are inflation our of there actions expense, the continue team exceptionally same cost reduction very months. plans, and here say I which the back that’s to And been that’s is, into look back-end think expect materials distribution that those, few think around of what next seeing are add, again, back assuming happening said back those what confident XX:XX of cost the would I QX the back expect, particularly Dan I over you’re the the rigor the nothing happen initiatives, I year feel will mean, those mentioned continues. we specific at used the now, thing, lines else and will probably going late which working start and QX in

Rob Dickerson

pass much. on. right. All Thank Super. XX:XX you it I’ll so

Dan Fachner

you, Thank XX:XX Rob.

Operator

All XX:XX Excuse right. me.

question Brooks. Our next from is Todd

line is open. Your

Todd Brooks

XX:XX all How Hey, good morning, you doing? everyone.

Dan Fachner

morning. Good XX:XX

about great. We are doing you? How

Todd Brooks

can questions the month in talk gross the were A follow-up last you that inflationary line pre-Omicron Thanks. cost at If gross well. how of margin, margin? back then Rob’s much doing to about I’m quick to much of questioning. on maybe pressures and margin seeing accelerated pressure QX, we XX:XX look hit of go how quarter, and gross couple you

Dan Fachner

peak sales things throughout increases produce I and big rising get throughout of out make to we’re bring labor we’ll as the and half to again, a it and labor and our and was it the the the peak cost be across in one pressures all want this the ship that we’re some to calling piece sick working and XX:XX throughout hard was quarter. things of it and tag did Well that XX:XX we XX:XX the temp know you team customers. having into the it sure that it. continuing of to quarter. don’t overtime quarter, the So, happened end Distribution peaked but but that the distribution is some, soft got that and labor Omicron, effect that really hours certainly like certainly people to to definitely not with with out of experiencing quarter able wanting were quarter. – a can. towards everything produce that not to There we them products the that later

I cost worse. the all continue just quarter get it was across a to and think rising

that about you So want some? to Ken, talk

Ken Plunk

where just, distribution, I’ll the Yes, some quick start costs of in again of my career. that kind Dan I’ve of, XX:XX seen as as fast escalation on ended,

an great that to And four our on quarter. situation then drive our there’s getting and know, we that things results think in to brought long-term mentioned impact. quarter, three pickup QX. items raw There availability to I are the now and was are growth increase get at level had are to one of or sales as starting and in management did of and things outbound product months, materials. QX that, third-party already engaged, have and ensure mentioned a over a those continue they that warehouse part as our freight specific get us. such share. we and revenue for it just XX:XX the XX:XX it toughest margin very and certainly And yes, in because they idea, you biggest of that around I around escalation will a plans quickly you cost as we combination relates in biggest continue But and for place the our of December, taken and market huge cost that as We before, and give was of logistics that locations as the costs expert in had escalate the why increase responsibility to commitment from and standpoint. line you distribution. goods was the it back well to first within if labor in month December Dan thing same of mentioned. So, look distribution got we just one QX to invest the reason you is the just a And quarter line We those of our there to did from relates continue the that is to XX:XX Just one of business under sales to plus both So, as XX:XX know, XX%.

Todd Brooks

magnitude into can maybe way as not drop follow-up with enough variant? XX:XX the not as through this then that what’s the current staffing out That’s Just the same helpful. as the labor? Omicron you’re the So, chase levels? I kind rolling to having our a experience we’re far obviously December Thanks, of Do of in volumes strong of working month same Ken. of beginning pressure And year?

Dan Fachner

better, December. getting Todd, you said, and isn’t It’s XX:XX January as

that and aren’t through as as year-over-year towards we’re However, the or end but still year in labor nice of today. the December we do experienced that to end issues increases the are the believe the we’ll of that, continue they seeing challenging mid-December

I could However, challenging long, be think it some year extent. to all

Todd Brooks

it’s XX:XX Okay, blanket and break segments, where but we I pricing maybe great. pricing, XX-day to over of, in so it’s about Service period we, and stood effect talk on Food statement what next then in talk this to business? into, you it on Can kind hard tried about put give QX to put QX? What an a just you’re maybe across pricing magnitude over the in blended XX-day trying of know to

Dan Fachner

to be been consumers, taken effect. we’ve right? first more Well, our would And might increase pricing probably bit to should we a XX:XX so have to comes go than little always and We conservative that with sensitive when around customers have it have tried our an been.

And heard and we’ve have Icee back effective the him gone But probably with pricing business, so, our call he’s January largest out right some the me XX:XX about that at really became we in [indiscernible] and pricing really about really today. then really the We’ve we and hard. you’ve third where taken that of talk talk we’re ever pricing in on effect happens at team that, he led of on some of Senior Bjoern looked really, the quarter, new of taken about on and Sales, gone will XX:XX end the quarter and we’ve that the this me in the and Service Vice done so of Leyser J&J side. on our with felt Service heard You’ve the and has Food are good really our and of back President this mainly Food quarter, take side side that, this but quarter. end that

Todd Brooks

So… XX:XX

Dan Fachner

a pricing in rate again XX:XX at past. probably And have taken the then we larger

Todd Brooks

from margin pricing they we should cost the increases, of, how if recapture from use, fully if Ken, you So, Rob’s kind implement? much XX:XX constructive stable here, gross

Ken Plunk

level Well, yes, of it the is last scale double through what it time. this. took know, XX:XX But, of kind mean, year. I its will I’m going at way leave increase to you we

product, X%-plus customer, big at ones inflate that the is double-digits. continues commodity looking does you’re of for vary yes, composition it’s customer, average it So, by So, for flour XX:XX and example us on depending to product, etcetera. of a products, probably one on

back You know, over in least get of QX. QX, not we’ll expecting that the And enjoy in QX to that margin gross play will which cost would some But call of that with right bulk XX% us in that reduction the more benefit I is out double-digit just going of somewhat mentioned improvement we’re we and environment to marginal, enable but combination the doesn’t now, continue, inflationary assuming that QX. at range, initiatives that. entirely it to but

Todd Brooks

sequentially, can release can then if quarter. of if giving we in jump maybe Obviously kind that we which brand Thanks. see maybe versus course the December you we what I to Dan point ask And the for introductions? flat then and And forward queue. new And outlook business And great. is between relatively performance across I’ll discovery don’t recovery if more and quarter? parse can and September schedule? secondly, the the versus revenue – about of the talk just one Okay, theater the great the business XX:XX typically strength back and quarter

Dan Fachner

in three really from three increase coming and see. to I you to Well, of mentioned of products of sales I encouraging really core good this increase most segments. that’s already, XX:XX had them the board. across that our All is And proud all think,

seeing theaters it. movie, saw So, Omicron the in movies in movies back beverage We’re distribution those one great The seeing And December of side retail the of in theater that seeing to back side, seeing a And that being in novelties channel. encouraging pretzels churros channels. in in lot frozen an we’re were it released and to our XX:XX grow times, whole see people timing our all across of say and come great business to good when had a really released. there based of the the immediate a increase, really charging increase, December, the that’s see and to increase. December increased in we’re we’re was frozen XX:XX really the on came released are we out midst those jump the it we the continuing

what rest business And I And the for the so tell forward year. theater of that’s that. would this you by going encouraged about

be in in what released, to their a As that what end we’ll sell we we again. that that, the XX:XX year, to in right their reduction because have it the business return past, of was we in And the similar XXXX. location be by SKUs, more the movies XXXX. of per in than particularly greater to XX% could Our might pretty nice of business to than range think I in you see their places used said I’ve sell we

So, movie than I there am release, this, just encouraged willing would a of that by midst that, the we level to when at higher business say go I people encouraged, be the in good may is the it see but a are theater pandemic even.

Todd Brooks

along. Okay, Thanks, great. XX:XX pass I’ll

Ken Plunk

deal XX:XX – was under big That’s just XXXX. view, FY December mentioned in we my a a hair again

you right because to consumers back. Batman, see you inventory, there Gun, really The in of product or encouraging of the to look even more kind in three probably of months buildup that’s the of The And is movies that’s encouraging. when kinds coming encouraging as ago, there the think a lot more four me, are and so see So, product I those that’s out, we coming movies Top theaters.

Todd Brooks

jump XX:XX That’s great, in thanks. back queue. I’ll

Dan Fachner

XX:XX Todd. Thanks,

Ken Plunk

Okay. XX:XX

Operator

our next comes Go Ryan ahead please. And XX:XX question from Bell.

Dan Fachner

Good XX:XX morning, Ryan.

Ryan Bell

Good XX:XX of sort the just with at cases beginning I elevated of sort had and question year. about of COVID of morning. impacts calendar this the a end XXXX

we’re impacts the what on of trying Omicron? potentially relief about cresting to the and Just understand then the seeing quantification been that, over have any that as getting might sort you from had if businesses

Dan Fachner

impact you our there, tell or the I if know of identify was percentage you, what can business. is we number of don’t labor a COVID on but had cases biggest a I Ken, Ryan, side would the XX:XX the

from wasn’t the in what the way customer XX:XX needed the J&J over having where affected consumer So, variant for saw to side on labor and on but or with with the to our and through side and we impact of labor. service we as the many December. really those the all that is and continue sales additional We out do shortages quarter some the the cover time to field and the all to both strong food labor have Icee business, the snack the cover shortages, side of at level, technicians it the in way through suffering them

Ryan Bell

XX:XX I Service may was you’re when pricing the X% that, far of have this Food so that And has include or then year. taken about, And pricing? at least year. think this Okay, been does thanks, that’s it’s the this, of so talking but helpful. far some misheard it not some I about

Ken Plunk

me in at up it price we’ve of the let that a but and sort costs the taken No, should double We’ll that clear the it process aggressive. of increases X%, X% the not what Service been thinking try bit. just averages. Food more product call already in Dan and call we the XX:XX thing, year the we be are things. that XX:XX probably different to point price Icee side on Those made on look increases at little us are probably in hindsight, based was the kind customer that gone last One J&J have on are up again to average and specifics took, ones that having the that’s of to we have is taking everybody retail magnitude of industries But double-digits. as just of that

programs, we that that’s and we backup, back the the so, the half confident growing of about, great the innovation we margins other got that, with along through about why new we’ve quarter, things and sales really as as feel you it, want where we’re it, get year. the we have one this we really emphasizing in keep you And get doing. good know We feel

Ryan Bell

much XX:XX you Thanks, increase maybe lot place it is that’s where supermarket helpful. a base retail you expand in to that’s hold more? think the the And going then in business than do do hold base was will And calendar of How a opportunities forward? little structurally that or better bit see XXXX.

Dan Fachner

like some newer products, We some going at grow like on encouraged in XX:XX some We got really We’re we that. can good that We’ve got products. potentially things group. we’ve today great to on to hold retail. we’re feel good introduction by feel where some and even

Dogsters there We expect and merchandisers our frozen dip retail that nose of have some about don’t but largest in the the happening what’s excited specifically, really with mass its out we’re good distribution with new soon. anytime group and happening novelty one

Ryan Bell

of there is you’d before, of if but capital know And deploying for I just thinking one that me, incredibly potentially allocation, leverage Is thinking you’ve you’re a comes And don’t talked for range anything is your a potential XX:XX obviously in strong. about then strategies if last some this about be of balance there about terms acquisitions in sheet direct? capital? that terms then

Dan Fachner

really interest is to that way we thing to we to it. the all and vigilant hard balance strong to We’ve really type what want our some have in and Well, and be aspects I do the worked looked like but type use of XX:XX would we’ve storing at pretty that really cash, active last with that biggest up have would XX:XX that to cash. are a at fortunate to be and probably that look of Ken sheet we’re the we that continue of want over front. add-on] and on area we’ve opportunities feel [ph]. to acquisition good able Ken touch be so there out some that we or hope been months and three [or

Ken Plunk

Yes. XX:XX

lines on four or see focused are even new plants, The then the this quarter know, QX, so you’re will coming coming that’s, it in mentioned seeing frozen whether we and three novelties next we’re churros, lines lines year. get other in, you financials is more thing, investing areas, core Ryan product pretzels, on in it’s to in, our even of pipeline all that in. things need to improve those – and get efficiencies do more that we’re those There’s automated better and And investing we QX other innovation. and

we’re that’s very time. acquisition I opportunities we’re of for a just aggressive and at that. the money looking Dan think mentioned, using matter XX:XX So, in

So, we’re yes, that. maintaining cash for

of go But from we leverage do sheet Board have I leverage, a number terms those the clear specific opportunity support can In if have, the we balance to the know, know, that you we depending don’t on go, need we out. that. know, you bit, a

Ryan Bell

thanks That’s it XX:XX from much. me. so Great,

Dan Fachner

you, XX:XX Ryan. Thank

Operator

minute line. I a this me name to here, Give Okay. XX:XX have

Robert from is call this please. Costello. Go ahead and Okay,

Robert Costello

XX:XX Hello.

Dan Fachner

Robert. Good XX:XX morning,

Robert Costello

on reinvesting the continuing? Food percentage And what have is mentioned areas with the where Number the opportunities your specific I lines he future of that ago, you are in what CapEx, you for coming from is be little expansion think, of outlined your question. a more Service. a Could you growth Jerry Hi, where product best that money thought you was growth XX:XX of on the company? years

Dan Fachner

right earlier, products. I that past our before, great on in of Yes. right and to seeing our it you, when churros, lines we’re would at we’re talking and as Service, the Core as I products XX:XX core. still at answered for I the looking expand in churros core and Robert now. about this the still believe with tell growth now, production that’s frozen Jerry’s day, able biggest growth of meaning we’re to frozen expansion was novelties pretzels, and looking the our opportunity believe mentioned we’re being I the answer if he today pretzels if that how that opportunity novelties, Food that’s

Robert Costello

with now you’re that inflation pretty going is CapEx budget, what is it expand your cost? change the the the year Right, you there anticipating much or product XX:XX in cost And you to is the anticipated? of versus same line any the with the versus as did beginning

Dan Fachner

will slight some of that that the to sure lines be along those approved, we’ve don’t ones – pricing be there lines, there’ll start inflation change. on put some is go things but Well them the as sure, in I’m that there’ll Most locked for with we for if we the that. I’m in inflation some XX:XX in.

Ken Plunk

review, and go and those. before, through XX:XX Robert thing, modeling keep this so Yes, strategic we you mind operational within financial the of a each investments fit, in then we’ve of have other mentioned to each know, these is, and and committee capital rigorous

make we unless drive these very accretive returns. strongly they’re You we that decisions going don’t believe to know,

lot the a as focused putting really well is the So that primarily products. in know, lines as investing, of you are core which places, our of right decisions, these rigor level behind on

Robert Costello

are Two category XX:XX product right. questions you it quick a you mentioned, this? is you could specific, be churros more lines, doing the product how new on All new or anticipating

Dan Fachner

them one areas growth to and production, that maybe seeing some look continue comes of great the growth where great that’s to there We’re the spots call demand selling across we’re in churros XX:XX at that it, country that and lines able with the but going some we’re customers. be things it to seeing we’re so keep not potential new to I’ll that out up they’re the in regional churros them, today even to and business good we’re when with making

Robert Costello

– XX:XX the slightly interest do the over your you invested specifically? is year, what cash cash, Last rates rising question, what with

Ken Plunk

it rates over cash other the that were market of of most like to markets. given been very to are does. waiting we’ve most in Well, are XX-months, most company older There maturing what is the see liquid XX:XX every bonds last year money is that still some where those

up, for using money And option along using with of so, for money we’re for the that dividends, now back capital, that that come using investment that rates evaluating acquisitions. money

Robert Costello

cash you but it XX:XX have in is and you individual Right, that or now, the bonds? funds which have right been bond have don’t case,

Ken Plunk

of cash XX:XX most short-term XX XX-months. is in don’t we’ve those years million maturing, I know and bonds is The corporate liquid. There majority very – in next of only to in are I think it number that’s had XX probably, million probably of that a that the for

Robert Costello

you. thank right, All XX:XX

Dan Fachner

XX:XX Robert. you, Thank

Operator

again. And Okay. we you Todd have XX:XX Brooks Did another question? have

Todd Brooks

I Sure XX:XX did.

Operator

ahead. go Okay, XX:XX

Todd Brooks

you. Thank XX:XX

follow-up opportunities efforts that to these persistent the targeting at could some targeted want you manifest there or Just is be we’re here look efficiency inflationary from some that, the see are size of So enough efficiency Ken, total start these against, that offsets can we are the pressures? costs maybe where savings projects can and clear to point what can bigger in savings? company to if you any where

Ken Plunk

you and laid by of concrete I’ve a in had mean, our thing to quarter. more are supply I’ve out The what very Todd, putting very just plans together I done operations, Yes, know things than great a XX:XX these these ever job laid by gives said they’re little specific. calls leaders confidence month, one me out that bit have chain ago. reiterate is really

logistics yes, lot their in like that there distribution. once As On place mentioned got those areas initiatives is XX:XX realness technology, annualized we’ve is a a this million Todd, there an you number procurement, start look there our before the fruit. once XX:XX move We’ve basis, number. So conservative at annualized of bear a capability, to management and there in third-party of that. of to we $X leverage benefit an that’s

those the ownership, give next we know, some going but dollar There in the is go but some in in we really of are You and over plans together, those terms initiating this. to quarters. we’re think few of is of launching estimates, numbers, work, just low there you that high opportunities just to tie had single-digit in terms getting level specific terms of And terms timing. million

Dan Fachner

about XX:XX distribution, I’d focused by is just out really I focused we Todd, and add production what in even and to we’re there earlier, that side. encouraged that, think as procurement, on regional those talked R&D, we’re production, pricing efficiency on

really the feel with as year progresses, So, we that. comfortable

Todd Brooks

a great since And get on call, have That’s on little available we bit a more of I’d a just a help and more drive really product thoughts being growth your to XX:XX on then revenue final rate recent love new me, ability enhance to and brands time? to over these start or to to a one the engine brands from the looking this portfolio Lynwood product the Thanks. at extend thoughts the to J&J? arrival extension

Dan Fachner

anxious right a to great question. me Lynnwood be next to here that’s a is XX:XX of and Todd, sitting part this.

to over it turn I’ll Lynwood So, you.

Lynwood Mallard

XX:XX Thank it. getting me appreciate Yes. Hi, Todd. I you involved. for

the Italian ability to it’s We in Fruit, have innovate it’s brand XX:XX promising space which confidence to we to for stretch the Ice Service some Food brands, and outside. upside SuperPretzel or Service, novelties our opportunity and a followed some the brands, into blooming the We spaces of in enormous. retail. tons you brands stretch brand one, starting these on new distribution to when with of shoots extend like novelties lot to expansion, these nuts we in by of be ability with that inherent natural call be place our later and in both is new Honestly, we lot a us spaces, further Luigi’s have across a our mentioned and channels brands is have a strength The and bites, we’re Gelato. And continue into has as its in brands retail upside see confidence XX:XX Luigi’s, to a just Whole with fantastic the seeing not in speak in core pretzel space to as further Dan customers. Icee just pretzel continue well Food of distribution Dogsters in in where positive new with year. I’ll growing innovation last leadership overall pet category. up just lot Dogsters the industry with our as do green think a is get There big category. I brand, of is into Dogsters just and largest about novelty Luigi’s out for about XX:XX have into left so like we Then

that’s Dan, thoughts. leave of a anything So, we it there, confidence, have line just to… top lot a few I’ll

Dan Fachner

you more No, little a bit to. you touch on could XX:XX want Gelato just if

We haven’t mentioned introduce time a that that. yet, to good that was

Lynwood Mallard

month natural genuine tell and a it’s We’ve with as a consistent It’s fit. in just fantastic March. launching as that can it’s early next three been a Yes, Gelato, it’s you, real flavors XX:XX launching. brand’s product. Italian we’re positioning I

very we’re that. excited So, about

Todd Brooks

to it. XX:XX very hungry I’m listening

So, I can’t it. on wait to get my hand

Dan Fachner

guess XX:XX I [Indiscernible].

Todd Brooks

for do. and I Thank the Thank Yes, you all XX:XX you. appreciate time it.

Dan Fachner

Thank Todd, really questions. you, the appreciate XX:XX

Ken Plunk

XX:XX you, Todd. Thank

Operator

And this Okay. no queue. more questions time are in the there at XX:XX

Dan Fachner

We on to progress Thank call. joining Have afternoon. speaking on call look Great. great very quarter second updating during interest a the thank and your and and our XX:XX everyone today. with for Well much you you support forward soon. us you our continued look you appreciate to forward

Operator

participating. XX:XX you for Thank conference. Thank gentlemen, and today’s you. Ladies this concludes

disconnect. You may now

J&J Snack Foods (JJSF) 1 Feb 222022 Q1 Earnings call transcript