Vending

J&J Snack Foods boosts Q3 2023 sales, earnings

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August 1, 2023

J & J Snack Foods Corp. lifted its Q3 2023 sales and earnings over the prior year period, driven in part by the acquisition of Dippin' Dots, according to a press release. Sales rose in all business segments. Highlights include:

• Sales rose from $380.2 million in Q3 2022 to $425.8 million in the quarter ending June 24, 2023.
• Net earnings rose from $15.5 million to $34.9 million in the comparative quarters.
• EPS rose from 81 cents to $1.82 on a basic basis and from 81 cents to $1.81 on a diluted basis.
• Adjusted earnings per diluted share rose from 95 cents to $1.92.
• Foodservice sales rose 11.9% from $227.8 million to $254.9 million.
• Core brands and products continued to experience revenue growth, including 176.4% growth in frozen novelties, reflecting the acquisition of Dippin' Dots, a 19% increase in churros and a 13.6% increase in soft pretzels.
• Sales of new products and expanded customer placement were approximately $400,000, driven primarily by bakery products at a major convenience store customer.
• Retail supermarket sales increased 0.2% from $61 million to $61.2 million.
• Handhelds sales grew by 180.2%, while frozen novelty, soft pretzel and biscuit sales declined by 0.4%, 12.2% and 15.3%, respectively, versus the prior year period.
• New product innovation and expanded placement contributed approximately $3.5 million in the quarter led by handheld sales to a major mass merchandiser and a frozen novelty item with grocery customer.
• Frozen beverage segment sales rose 20% from $91.4 million to $109.6 million.
• Beverage sales grew 26.1% led by 9% growth in gallons reflecting strong theater performance and continued strong consumption trends across mass merchants and amusement venues.
• Machine repair and maintenance service revenues increased 5.5%, reflecting healthy ongoing maintenance business, while equipment sales increased 17.1% on the back of growing installations with new clients.

Shares traded Monday at $160.32 against a 52-week range of $127.80 to $165.90.

The $425.8 million in quarterly revenue missed analyst expectations by $17.36 million while the Non-GAAP EPS of $1.92 beat expectations by 39 cents, according to Seeking Alpha.

"Our results showcase the positive impact of the various operational and strategic initiatives undertaken over the past two years combined with an improving inflationary environment," Dan Fachner, president and CEO, said in the press release. "Our frozen beverages business delivered record sales and profits for the quarter led by a recovering theater industry and strong gross margin performance."