US nut group John B. Sanfilippo & Son saw rising sales for its brands, including Fisher, drive annual sales but the company’s profit numbers were mixed.
Full-year sales for the 12 months to 30 June rose to US$952m, an increase of 7.3% year-on-year. Sales volumes were up 6.6% in the period, with growth across all sales channels, the company said.
“Our brands continued to grow significantly in respect to sales volume,” CEO Jeffrey Sanfilippo said. “Our consumer channel sales and marketing teams were very effective in executing our most important growth strategy, which is [to] grow our brands.”
However, increases in the cost of sales and operating expenses dampened operating profit, which dropped to $51.3m from $51.9m in the 12 months. This was offset by lower interest and rental expenses, meaning net profit was higher in the year, rising from $29.3m to $30.4m.
Sanfilippo has three divisions – consumer, contract packaging and commercial ingredients. The company saw revenue from all three channels rise in its last financial year, although, looking ahead, Mr. Sanfilippo said the business would lose a customer for its commercial ingredients arm in the first half of 2016/2017.
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“While sales volume increased in our commercial ingredients channel in the quarterly comparison, in August, we were notified by a significant customer in this channel of its intent to move some or all of its almond butter requirements to a vertically integrated almond butter supplier during our second quarter of fiscal 2017. Almond butter sales to this customer in fiscal 2016 were approximately $90 million, while the gross profit margin on this business was substantially lower than our total gross profit margin for fiscal 2016. Demand for almond butter in the commercial ingredients channel has been increasing considerably in recent years, and we believe that we will have many opportunities to secure new almond butter business during fiscal 2017,” Mr. Sanfilippo said.