Completes Implementation of Cost Savings Designed to Reduce G&A Expense to $30 Million Annually
Repurchased 477,356 Shares as of December 1, 2014
Comments on Favorable Same Store Sales for First Eight Weeks of the Fourth Quarter
EMERYVILLE, Calif. - (BUSINESS WIRE) - Dec. 4, 2014 - Jamba Inc. (NASDAQ:JMBA), a leading health and wellness brand and the leading retailer of freshly squeezed juice, today provided an update on its continuing movement to an asset light model and other initiatives to enhance shareholder value. The Company also provided an update on business momentum in the fourth quarter.
"We are pleased with the progress we are making on all fronts at Jamba as our juice and whole food blending platform continues to gain consumer traction and we continue to implement improvements to enhance the efficiency and profitability of our organization," said James D. White, chairman, president and CEO of Jamba. "Over the past several months we have been working diligently to identify cost reductions and accelerate our transition to an asset light model, which we believe will enable our company to drive growth and shareholder value."
Jamba continues to execute its movement to an asset light model through an accelerated refranchising program. Jamba has previously refranchised 13 stores and added 51 new global franchise stores through the end of the third quarter. In furtherance of the Company’s previously announced accelerated refranchising program of an additional 114 stores in California, the Company’s business development team has been coordinating with potential franchisees and has received considerable interest thus far. Jamba expects to have packages ready for prospective franchisee bidders shortly and remains on track to complete its accelerated refranchising program within the first half of 2015. With this progress to date, the Company believes it will be in position to achieve its target of at least an 80%+ franchise-to-company-owned model in the next 12 months. Furthermore, the Company remains on track to add 500 new franchised stores in the next five years, further positioning it as an asset light model.
Since August 2014, Jamba has been working with Capgemini, a leading provider of consulting, technology and outsourcing services, to create workflow efficiencies and identify cost savings. Jamba has now fully implemented organizational changes and anticipates it will meet its goal of reducing the Company’s overall G&A expense by the previously identified 20%, resulting in approximately $30 million of annual G&A expense.
As of December 1, 2014, Jamba has repurchased 477,356 shares of its common stock for a total of $6.0 million under its previously announced stock repurchase program. The Company continues to believe the repurchase program is a prudent use of its capital. The Company also intends to institute a 10b5-1 Share Repurchase Plan to facilitate further repurchases of its common stock under its previously announced plan.
Jamba today reported that same store sales have shown increases in the mid-single digit percentage point range through the first eight weeks of the fourth quarter of 2014. This strong sales momentum reflects increasing consumer adoption of the Company’s juice and whole food blending platform as well as its recently launched line of cold pressed ready-to-drink juices. The Company continues to expect that its shift to more health and wellness items will drive greater traffic and increased sales results.
As demonstrated by the actions outlined above, the Jamba Board of Directors and management team continue to take meaningful steps to drive significant growth and value creation. Jamba looks forward to providing further updates on its progress on these and other initiatives in the future.
Founded in 1990, Jamba, Inc. 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 teas, and a variety of food items including hot oatmeal, breakfast wraps, sandwiches, Artisan Flatbreads™, baked goods, and snacks. As of September 30, 2014, there were 807 Jamba Juice store locations globally. Jamba is a proud sponsor of "Team Up for a Healthy America" in the fight against childhood obesity and encourages fans to join the Team Up community of celebrities, athletes, and other leaders committed to getting kids active and involved at www.myhealthpledge.com. 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", "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 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.
SOURCE Jamba Inc.
Dir. Corporate Communications