Jamba Reports First Fiscal Year of Net Income since Becoming a Public Company
Comparable Store Sales Growth for Second Consecutive Year – 5.1% Company and System-Wide in Fiscal Year 2012
Number of International Stores Increases by 16 in Fiscal Year 2012
EMERYVILLE, Calif. - (BUSINESS WIRE) - Mar. 5, 2013 - Jamba, Inc. (NASDAQ:JMBA) today reported unaudited financial results for the fourth quarter and fiscal year ended January 1, 2013.
For the year, Jamba delivered on all its targets and strategic objectives for strengthening the business model, recording its first year of net income since becoming a public company with an $8.6 million swing in year over year profitability and a second consecutive year of comparable store sales gains for Company-owned stores, attaining 5.1% in fiscal year 2012. Along with the core Jamba business, three key areas showed solid gains in becoming growth drivers for the future – Jamba branded consumer products, the JambaGO express business and international expansion.
For the quarter, Jamba recorded a system-wide comparable store sales increase and significant revenue growth for the portfolio of Jamba-branded CPG products. In addition, Jamba opened 23 franchise-operated stores in the U.S. and international markets and announced plans for adding up to 125 stores in California over the next several years.
“Jamba achieved significant growth and record accomplishments in fiscal 2012 and we look forward to the momentum continuing in 2013. Our annual net income, Jamba’s first since the Company became public, signals that we have a business model designed for accelerated, sustained profitable growth. Our new BLEND Plan 3.0, introduced earlier this year, will broaden and strengthen our efforts to become a globally recognized $1 billion globally recognized, healthy active lifestyle brand by 2015,” said James D. White, chairman, president and CEO of Jamba, Inc.
“We expect our growth will come on several fronts including our core business that will have an innovative, extended beverage and food portfolio across all day parts; an expanded retail footprint with new concepts, formats and markets; increased growth for Jamba-branded CPG products; and global expansion for both retail stores and CPG products,” Mr. White said. “And we will continue to relentlessly pursue new ways to reduce costs, increase engagement throughout our organization and drive productivity.”
Highlights for the 52 weeks ended January 1, 2013, compared to the 53 weeks ended January 3, 2012:
Highlights for the 13 weeks ended January 1, 2013, compared to the 13 weeks ended January 3, 2012:
For the fiscal year ended January 1, 2013, total revenue increased 1.0% to $228.8 million from $226.4 million in the prior year. The increase is primarily due to the 5.1% increase in Company-owned comparable store sales(1) and increased CPG revenues, partially offset by $6.8 million increase in customer value-price promotions and the approximately $3.6 million effect of 52 weeks in fiscal 2012 compared to 53 weeks in fiscal 2011. The increase in Company-owned comparable store sales(1) of 5.1% was driven primarily by an increase in transaction count of 250 basis points and an average check increase of 260 basis points. During fiscal year ended January 1, 2013, franchise-operated comparable store sales(1) increased 5.1%. Franchise and other revenue increased 17.8% to $13.7 million from $11.6 million in the prior year. Jamba’s CPG revenue was $2.1 million in fiscal 2012, compared to $1.1 million in the prior year.
Jamba’s non-GAAP adjusted operating profit(2) increased $7.3 million to $52.4 million for fiscal 2012, reflecting Company-owned store comparable sales growth and the impact of the Company’s cost savings initiatives. Non-GAAP adjusted operating profit margin(2) increased by 300 basis points to 22.9% for fiscal 2012 as compared to the prior year, primarily as a result of improved leverage of its fixed costs resulting from the positive Company-owned comparable store sales increase.
The general and administrative expense increase of $3.0 million from the prior year primarily resulted from the grant of increased amounts of performance and stock based compensation and the Company’s accelerated investments in growth initiatives during fiscal 2012, including JambaGO, the Talbott Teas business and research on development concepts. The increase was partially offset by the approximately $0.5 million effect of 52 weeks in fiscal 2012 compared to 53 weeks in fiscal 2011. On a non-GAAP adjusted basis(3), excluding these factors, G&A increased $0.1 million.
For the fourth quarter ended January 1, 2013, total revenue was essentially flat at $44.2 million compared to the $44.3 million in the prior year period. The slight decrease in Company-owned comparable store sales(1) was offset by the increase in franchise revenues relating to the 2.3% increase in franchise-operated comparable store sales(1) and the opening of 45 additional domestic and international franchise-operated stores, net, from the prior year and a 200% increase in CPG revenue. Jamba’s CPG revenue was $0.8 million in the fourth quarter of 2012, compared to $0.3 million in the prior year period. Franchise and other revenue increased 24.5% to $3.4 million from $2.8 million in the prior year period. In the fourth quarter of 2012, the system-wide comparable store sales(1) increase of 0.6% was driven primarily by an increase in average check of 460 basis points, partially offset by a decrease in transaction count of 400 basis points.
Jamba’s non-GAAP adjusted operating profit(2) increased $0.2 million to $5.6 million from the fourth quarter of 2011 reflecting increased franchise revenues relating to franchise-operated comparable store sales(1) growth and the addition of 45 domestic and international franchise-operated stores, net, from the prior year and impact of the Company’s cost savings initiatives. Non-GAAP adjusted operating profit margin(2) increased by 50 basis points to 12.7% for the fourth quarter of 2012 compared to 12.2% in the prior year period, primarily as a result of continuing improvement in store labor efficiencies.
General and administrative expense decreased from $11.9 million to $11.6 million from the fourth quarter of fiscal 2011. The decrease primarily resulted from the decrease in performance-based compensation and litigation settlement and fees, partially offset by accelerated investment in growth initiatives during the fourth quarter of 2012. On a non-GAAP adjusted basis (3), excluding these factors, G&A decreased $0.2 million.
As of January 1, 2013, system-wide, Jamba has 774 stores in the United States, of which 473 are franchise-operated stores and 301 are Company-owned. Franchise-operated stores include 14 Jamba Smoothie Stations™, the new limited menu express format. During the quarter, Jamba opened 20 new domestic franchise-operated stores, four traditional and 16 non-traditional, and three international store locations, two in the Philippines and one in South Korea. One new Company-owned store opened. As of January 1, 2013, there were 35 international store locations, all of which are franchise-operated. During the fourth quarter, the total number of JambaGO served locations increased to 404 from 35 in the prior year fourth quarter.
Effective for Fiscal 2012, which began on January 4, 2012, the Company changed the end of its fiscal quarters. Each quarter now has 13 weeks, resulting in a 12 period fiscal year. Prior to fiscal 2012, the first quarter had 16 weeks and the three subsequent quarters had 12 weeks. The Company’s year-end continues to be the Tuesday closest to December 31.
On January 1, 2013, the Company held $31.5 million in cash and cash equivalents compared to $19.6 million cash and cash equivalents at January 3, 2012. On January 1, 2013, the Company had a restricted cash balance of $0.2 million compared to $1.4 million at the end of fiscal 2011.
The Company continues to expect to achieve the following results for fiscal 2013:
A conference call to review the fourth quarter and full year 2012 results will be held today, March 5, 2013 at 5:00 p.m. ET. The conference call can be accessed live over the phone by dialing (877) 941-4774 or for international callers by dialing (480) 629-9760. A replay will be available at 8:00 p.m. ET and can be accessed by dialing (877) 870-5176 or (858) 384-5517 for international callers; the pin number is 4602860. The replay will be available until March 26, 2013. The call can be accessed from the Company’s website at www.jambajuice.com under the Corporate Investor Relations section or directly at http://ir.jambajuice.com.
Jamba, Inc., (the “Company”) owns and franchises Jamba Juice stores through its wholly-owned subsidiary, Jamba Juice Company. Jamba Juice Company is a leading restaurant retailer of better-for-you, specialty beverage and food offerings, which include great tasting, whole fruit smoothies, fresh squeezed juices and juice blends, hot coffee and teas, hot oatmeal, breakfast wraps, sandwiches and mini-wraps, California Flatbreads™, frozen yogurt, and a variety of baked goods and snacks. As of January 1, 2013, there were 809 store locations globally. There were 301 Company-owned and operated stores and 473 franchise-operated stores in the United States, and 35 international stores. Jamba Juice Company has expanded the Jamba brand by direct selling of consumer packaged goods (“CPG”) and licensing its trademark. CPG products for at-home enjoyment are also available online, through select retailers across the nation and in Jamba outlets in the United States.
Fans of Jamba Juice can find out more about Jamba Juice's locations as well as specific offerings and promotions by visiting the Jamba Juice website at www.JambaJuice.com or by contacting Jamba’s Guest Services team at 1-866-4R-FRUIT (473-7848).
This press release (including information incorporated or deemed incorporated by reference herein) contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are those involving future events and future results that are based on current expectations, estimates, forecasts, and projections as well as the current beliefs and assumptions of the Company’s management. Words such as “outlook”, “guidance”, “believes”, “expects”, “appears”, “may”, “will”, “should”, “anticipates”, or the negative thereof or comparable terminology, are intended to identify such forward looking statements. Any statement that is not a historical fact, including the statements made under the caption “Outlook for 2013” and any other estimates, projections, future trends and the outcome of events that have not yet occurred, is a forward-looking statement. Forward-looking statements are only predictions and are subject to risks, uncertainties and assumptions that are difficult to predict. Therefore actual results may differ materially and adversely from those expressed in any forward-looking statements. Factors that might cause or contribute to such differences include, but are not limited to factors discussed under the section entitled “Risk Factors” in the Company’s reports filed with the SEC. Many of such factors relate to events and circumstances that are beyond the Company’s control. You should not place undue reliance on forward-looking statements. The Company does not assume any obligation to update the information contained in this press release.
The Company provides certain supplemental non-GAAP financial measures to its investors as a complement to the most comparable GAAP measures. The GAAP measure most directly comparable to non-GAAP adjusted operating profit is net income/loss. An explanation and reconciliation of this non-GAAP financial measure to GAAP information is set forth below.
The Company believes that providing these non-GAAP measures to its investors, in addition to corresponding GAAP income statement measures, provides investors the benefit of viewing the Company's performance using the same financial metrics that the management team uses in making many key decisions and understanding how the Company's core business operations may perform and may look in the future. The Company’s core business operations comprise Company-owned and franchise-operated stores and consumer packaged goods (CPG) operations. The Company believes its core business performance represents the Company's on-going performance in the ordinary course of its operations. Management excludes from the Company’s core business performance those items, such as impairment charges, income taxes, restructuring and severance programs and costs relating to specific major projects which are non-routine, expenses or income from certain legal actions, settlements and related costs, general and administrative expense, including non-cash compensation related to stock and options. Management does not believe these items, including non-cash items, are reflective of the Company's ongoing core operations and accordingly excludes those items from non-GAAP adjusted operating profit and non-GAAP adjusted operating profit margin. Additionally, each non-GAAP measure has historically been presented by the Company as a complement to its most comparable GAAP measure, and the Company believes that the continuation of this practice increases the consistency and comparability of the Company's earnings releases. The non-GAAP adjustments are discussed further below.
Non-GAAP financial measures are not in accordance with, or an alternative for, generally accepted accounting principles in the United States of America. Non-GAAP measures should not be considered in isolation from or as a substitute for financial information presented in accordance with generally accepted accounting principles, and may be different from non-GAAP measures used by other companies.
(1) Comparable store sales are calculated using sales of Jamba Juice stores open at least one full fiscal year. Company-owned comparable store sales percentages are based on sales from Company-owned stores included in our store base. Franchise-operated comparable store sales percentages are based on sales from franchised stores, as reported by franchisees, which are included in our store base. System-wide sales percentages are based on sales by both Company-owned and franchise-operated stores, as reported by our franchisees, which are included in our store base. Company-owned stores that were sold in refranchising transactions are included in the stores base for each accounting period of the fiscal quarter to the extent the sale is consummated at least three days prior to the end of such accounting period, but only for the days such stores have been Company-owned. Thereafter, such stores are excluded from the store base until such stores have been franchise-operated for at least one full fiscal period, at which point such stores are included in the store base and compared to sales in the comparable period of the prior year. Comparable store sales exclude closed locations. Company-owned comparable store sales percentages as used herein, may not be equivalent to Company-owned comparable store sales as defined or used by other companies. Franchise-operated comparable store sales percentages and system-wide sales percentages as used herein are non-GAAP financial measures and should not be considered in isolation or as substitute for other measures of performance prepared in accordance with generally accepted accounting principles in the United States. Management reviews the increase or decrease in Company-owned comparable store sales, franchise-operated comparable store sales and system-wide sales compared with the same period in the prior year to assess business trends and make certain business decisions. The Company believes the data is useful in assessing the overall performance of the Jamba brand and, ultimately, the performance of the Company, the Company-owned stores, and the franchise-operated stores.
(2) Non-GAAP adjusted operating profit is calculated as net income (loss) as determined in accordance with GAAP, excluding the items described below and as specifically identified in the non-GAAP reconciliation schedules set forth below. Non-GAAP adjusted operating profit margin is calculated as non-GAAP adjusted operating profit as a percentage of GAAP total revenue. The Company evaluates its performance using non-GAAP adjusted operating profit margin to assess the Company's historical and prospective operating financial performance, as well as its core operating performance relative to its competitors. Specifically, management uses these non-GAAP measures to further understand the Company's core business operating performance. The Company believes its core business operating performance represents the Company's on-going performance in the ordinary course of its core operations. Accordingly, the Company excludes from its core operating performance those items whose impact are not reflective of its core operations such as (a) interest income, (b) interest expense, (c) income taxes, (d) depreciation and amortization, (e) impairment of long-lived assets, (f) other operating, net, and (g) general and administrative expenses. The definition of adjusted operating profit margin is the same definition previously used by the Company to define operating profit margin in its 2012 guidance.
(3) Non-GAAP adjusted G&A expense is calculated as G&A, as determined in accordance with GAAP, excluding the items described below and as specifically identified in the non-GAAP reconciliation schedules set forth below. The Company believes that G&A expense adjusted for non-routine items and performance compensation is a helpful indicator of the Company’s operating performance in that it shows the G&A expense without the impact of the non-routine items and performance compensation, the costs incurred for accelerated growth initiatives, charges for share-based compensation, the semi-annual performance-based compensation for achieving its strategic objectives, as well as the impact of one less week in the 52-week period ended January 1, 2013 and one additional week in the 53 week period ended January 3, 2012. Management does not believe these items are reflective of the Company’s ongoing performance and accordingly excludes those items from non-GAAP adjusted G&A expense.
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Source: Jamba, Inc.
ICR
Dara Dierks
203-682-8200
investors@jambajuice.com
Jamba is the global lifestyle brand leader serving on-the-go freshly blended fruit and vegetable smoothies, made-to-order bowls, fresh-squeezed juices and shots, boosts and bites.