Vending
J&J Snack Foods Q4 sales, earnings tumble but beat market expectations
November 9, 2020
J&J Snack Foods Corp., which manufactures brands including Superpretzel, ICEE, Slush Puppie, Luigi's Real Italian Ice, Minute Maid frozen ice, California Churros, The Funnel Cake Factory and more, reported a 19% decrease in fourth quarter sales from $311.9 million last year to $252.5 million for the quarter ending Sept. 26, 2020, according to an earnings release.
The fourth quarter revenue beat market expectations by $25.47 million and GAAP earnings per share of 35 cents beat projections by 32 cents, according to Seeking Alpha.
Shares traded at $139.38 Friday against a 52-week range of $105.67-$191.49.
"Our business continues to recover from the pandemic that has affected our world," Dan Fachner, president, said in the release. "We experienced sustained growth in the retail side of our business as well as improved sales as we closed the quarter in both foodservice and ICEE. The company has also enjoyed some new business sales growth that will extend into this coming year. We feel a sense of recovery as we close our 2020 year and like our future growth opportunities but we continue to face the uncertainty that all of us face from prolonged COVID-19 impacts."
Net earnings decreased to $6.6 million (35 cents per diluted share) in this year's fourth quarter compared to $26.1 million ($1.36 per diluted share). Net earnings for the quarter and year benefited from an adjustment to income tax expense related to state deferred taxes.
Operating income was $3.9 million in the fourth quarter, down from $31.1 million in last year's quarter.
The company also said it has had sequential improvement from its third quarter operations in which sales were down 34% from the year ago third quarter and in which it had an operating loss of $19.4 million as parts of the economy that impact its operations continued to open up through the fourth quarter.
Approximately two-thirds of the company's sales are due to venues and locations that have shut down or sharply curtailed foodservice operations during COVID-19.
As the company has $278 million of cash and marketable securities on its balance sheet, up from $267 million at March 28, 2020, it does not expect to have any liquidity issues, nor does it anticipate a material amount of its assets would be impaired.
For an update on how the coronavirus pandemic has affected convenience services, click here.
