• Underlying net income more than doubles to $6.7m
  • Adjusted EBITDA up 62.8%
  • Turnover grows 14.1%
Inventure Foods posted record annual sales and EPS

Inventure Foods posted record annual sales and EPS

A jump in sales of healthy and natural snacks has helped US firm Inventure Foods post record annual turnover and earnings.

Inventure said yesterday (28 February) sales of the snacks were up 26.8% last year, or 30% when the impact of the extra week in the previous financial year was removed.

Turnover was up 14.1% at $185.2m for the 12 months to 29 December. Excluding the extra week in Inventure's 2011 fiscal year and the impact of the disposal of its DSD business, sales increased 17.2%.

Underlying net income more than doubled to US$6.7m. Adjusted EBITDA was up 62.8% at $16m. Fully diluted earnings per share was a record $0.34, Inventure said.

The proceeds from the sale of Inventure's DSD business boosted net income and EBITDA further. Its reported net income for the year was $7.4m.

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Inventure Foods Reports Fourth Quarter and Fiscal Year 2012 Results

Record annual net revenue and EPS; Borrowings decreased $8.1 million

 

 

PHOENIX, Feb. 28, 2013 /PRNewswire/ -- Inventure Foods, Inc. (Nasdaq: SNAK), a leading specialty food marketer and manufacturer, today reported financial results for the fourth quarter and year ended December 29, 2012 highlighted by record annual net revenues of $185.2 million and annual fully diluted earnings per share of $0.38.

Two factors impacted the comparability of the Company's 2012 fourth quarter and fiscal year as compared to the 2011 fourth quarter and fiscal year. First, the fourth quarter of 2011 contained an additional reporting week. Inventure's fiscal year ends on the Saturday closest to December 31, which periodically results in a 53 week year. The fourth quarter and fiscal year ended December 29, 2012 contained 13 weeks and 52 weeks respectively, compared to the fourth quarter and fiscal year ended December 31, 2011, which contained 14 weeks and 53 weeks respectively. Second, the sale of the DSD business, which was effective November 5, 2012, impacted net revenues as the Company no longer sells third-party partner brands and sells company-owned brands to the new distributor at a lower cost.

Fourth Quarter Highlights

For the fourth quarter of 2012 compared to the fourth quarter of 2011:

  • Adjusted for comparability, net revenues increased approximately 8.5%
  • Gross profit increased 15.2% to $8.9 million.
  • Gross margin increased 310 basis points to 20.4%.
  • Completed a new distribution agreement with Snyder's-Lance, including the sale of the DSD business, resulting in a gain of $1.1 million during the quarter.
  • Diluted earnings per share were $0.12 or $0.08 excluding the gain on the sale of the DSD business.
  • EBITDA increased 88.6% to $5.0 million. Excluding the gain on the sale of the DSD business, Adjusted EBITDA increased 47.5% to $3.9 million, or 9.1% of net revenues. A table reconciling Adjusted EBITDA to net income is presented at the end of the consolidated financial statements included in this release.

Full Year Highlights

For the full year 2012 compared to the full year 2011:

  • Adjusted for comparability, net revenues increased approximately 17.2%.
  • Gross profit increased 22.4% to $36.9 million.
  • Gross margin increased 130 basis points to 19.9%.
  • Record diluted earnings per share totaled $0.38 or $0.34 excluding the gain on the sale of the DSD business.
  • EBITDA increased 74.0% to $17.1 million. Excluding the gain on the sale of the DSD business, Adjusted EBITDA increased 62.8% to $16.0 million, or 8.7% of net revenues.
  • Borrowings decreased $8.1 million during the year.

Quarter Overview

Consolidated net revenues for the fourth quarter were $43.5 million, a decrease of 2.1%, compared to $44.5 million during the prior-year period. Adjusted for comparability, net revenues increased 8.5%. Net revenues during the fourth quarter of 2012 were supported by a 10.3% growth, or 21.0% increase on a comparable week basis, in the healthy/natural portfolio over the prior-year period. Gross profit increased 15.2% to $8.9 million, compared to $7.7 million in the prior-year period. Gross profit margin improved 310 basis points to 20.4% from 17.3% last year, primarily in the Snack segment as a result of operational efficiencies, favorable materials costs, and the Company benefited from the sale of our lower margin DSD business. Selling, general and administrative expenses remained relatively consistent with the prior year at 14.1% of net revenues. Net income increased 218.8% to $2.4 million, while fully diluted earnings per share were $0.12, and EBITDA increased 88.6%, to $5.0 million, or 11.6% of net revenues. Excluding the gain on the sale of the DSD business, net income grew 123.6%, totaling $1.7 million, while fully diluted earnings per share were $0.08 and Adjusted EBITDA increased 47.5% to $3.9 million, or 9.1% of net revenues.

Snack segment net revenues of $21.5 million in the quarter were down 13.6%, compared to $24.9 million during the prior-year period. Adjusted for comparability, Snack segment net revenues decreased 3.1%. On a comparable basis, T.G.I. Friday's® net revenues decreased 9.2% during the quarter, partially offset by a 33.1% increase in sales of premium private label products. On a comparable basis, Boulder Canyon sales were up 9.8% in the fourth quarter.

Frozen segment net revenues, which include Jamba® All Natural Smoothies, totaled $22.0 million for the quarter, an increase of 12.6% over the prior-year period. Adjusted for comparability, Frozen segment net revenues increased 23.7%. Net revenues for the Frozen segment, excluding Jamba, increased 13.4% for the quarter due to continued growth in branded and private label frozen fruit sales. On a comparable week basis, Jamba sales increased 15.1% over the prior year-period to $2.6 million.

Full Year Overview

Consolidated net revenues for the year ended December 29, 2012 were $185.2 million, an increase of 14.1%, compared to $162.2 million during the prior-year period. Adjusted for comparability, net revenues increased 17.2%. This revenue growth was largely driven by a 26.8%, or 30.0% on a comparable week basis, growth in the healthy/natural portfolio. Gross profit increased 22.4% to $36.9 million, compared to $30.1 million in the prior-year period. Net income increased 164.4% to $7.4 million, while fully diluted earnings per share were $0.38, and EBITDA for the full year increased 74.0% to $17.1 million, or 9.3% of net revenues. Excluding the gain on the sale of the DSD business, net income grew 139.5% to $6.7 million, while fully diluted earnings per share totaled $0.34 and Adjusted EBITDA increased 62.8% to $16.0 million.

Snack segment net revenues were $94.4 million, a decrease of 0.7% from last year. Adjusted for comparability, Snack segment net revenues increased 2.1% for the year. Adjusted for comparability, T.G.I. Friday's and premium private label sales increased 3.5% and 20.4%, respectively, andBoulder Canyon sales were relatively flat in 2012.

Frozen segment net revenues totaled $90.8 million in the current year, an increase of 35.2%, or 38.8% on a comparable basis, from the prior year. Adjusted for comparability, net revenues for the Frozen segment, excluding Jamba, increased 49.4% during 2012 due to continued growth in branded and private label frozen fruit sales. Jamba net revenues for the full year 2012 totaled $13.8 million, and were relatively flat in 2012 on a comparable week basis.

Management Commentary & Future Outlook

"We communicated a strategic vision beginning in 2011 that included key investments in our facilities, brands and also our operations," said Terry McDaniel, Chief Executive Officer of Inventure Foods, Inc. "As we close out 2012, a year of double-digit growth in year-over-year net revenues as well as new records for annual net revenues and earnings, we remain encouraged by our team's delivery of our strategic plan. Our results are a testament to the diversity of our brand portfolio and the distribution channels for each of our brands. We are also excited that this success has not gone unrecognized, having been named as one of the best small companies in America by Forbes magazine. Additionally, Consumer Reports recently awarded our Boulder Canyon Hummus chip product with its highest rating, while our Nathan's Famous Honey Mustard Crinkle-Cut Fries received the 'Best New Product' award by Convenience Store News."

"As we look forward, we will continue to make the necessary investments to strengthen our brand portfolios," continued McDaniel. "We've made significant strides in building our healthy/natural portfolio and remain optimistic as we expand existing channels. Our ability to provide consumers innovative and first-to-market products is further underscored by our recent announcement of the exclusive licensing agreement with Seattle's Best Coffee to market and manufacture a healthier and affordable line of delicious, at-home frozen coffee drinks."

"2012 was a year of solid execution on our strategic plan, which has positioned us well to reap the benefits and further expand our base business throughout this coming year. Our consistent revenue and earnings growth over the past several years also provide further indication that our Company and our strategy remain on track to deliver sustainable long-term growth for our shareholders," McDaniel concluded.

 

Original source: Inventure Foods