John B. Sanfilippo & Son, Inc. First Quarter Diluted EPS was $1.11 per Share
John B. Sanfilippo & Son (NASDAQ: JBSS) reported its fiscal 2021 Q1 results, revealing a net income of $12.8 million, or $1.11 per diluted share, slightly down from $12.9 million in Q1 2020. Net sales decreased to $210.3 million, a 3.5% decline attributed to lower sales volume. Consumer distribution saw a 3.8% increase mainly from private brand sales, while significant declines occurred in the commercial ingredients channel, down 27.7%. Gross profit fell to $39.3 million with margins at 18.7%. The company raised its annual dividend by 8.3% and paid a special dividend of $1.85 per share.
- Net income nearly matched record results from Q1 2020, indicating stable profitability.
- Annual dividend increased by 8.3% to $0.65 per share, reflecting commitment to shareholder returns.
- Special dividend of $1.85 per share paid in Q1 2021, enhancing shareholder value.
- 3.8% increase in sales volume in the consumer distribution channel, driven by private brand growth.
- Net sales decreased 3.5% year-over-year, signaling potential market challenges.
- 27.7% drop in sales volume in the commercial ingredients distribution channel, heavily impacted by COVID-19.
- Gross profit decreased to $39.3 million, contributing to a reduced gross profit margin of 18.7%.
- Sales volume for branded products like Fisher recipe nuts and Orchard Valley Harvest dropped significantly, indicating distribution losses.
ELGIN, Ill.--(BUSINESS WIRE)--John B. Sanfilippo & Son, Inc. (NASDAQ: JBSS) (the “Company”) today announced operating results for its first quarter of fiscal 2021. Net income for the first quarter of fiscal 2021 was
Net sales decreased to
Sales volume for our branded products in the consumer distribution channel changed as follows:
Fisher recipe nuts |
(14.1)% |
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Orchard Valley Harvest |
(16.1)% |
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Fisher snack nuts |
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Southern Style Nuts |
(8.4)% |
The sales volume decline for Fisher recipe nuts resulted from lost distribution at some customers, which was offset in part by increased sales with Internet retailers and increased sales with other existing customers in the grocery sector. The sales volume decline for our Orchard Valley Harvest brand came primarily from some lost distribution at one customer and reduced foot traffic at a major customer in the non-food sector as a result of COVID-19. The Fisher snack nuts sales volume increase was due to increased promotional activity and distribution gains at new and existing customers for our Oven Roasted Never Fried product line. The decrease in sales volume for Southern Style Nuts was due to lower promotional activity at several customers, which was offset in part by distribution gains with new grocery customers and increased sales with Internet retailers.
Gross profit decreased to
Total operating expenses, as a percentage of net sales, declined to
Interest expense declined
The value of total inventories on hand at the end of the first quarter of fiscal 2021 declined
“The first quarter fiscal 2021 net income and diluted earnings per share nearly equaled the record results we reported in last year’s first quarter despite COVID-19 related challenges in our food service business. We also continued our goal of returning profits to our stockholders by increasing our regular annual dividend by
The Company will host an investor conference call and webcast on Tuesday, October 27, 2020, at 10:00 a.m. Eastern (9:00 a.m. Central) to discuss these results. To participate in the call via telephone, dial 1-844-536-5471 from the U.S. or 1-614-999-9317 internationally and enter conference ID number 6069596. This call is being webcast by Intrado Digital Media and can be accessed at the Company’s website at www.jbssinc.com.
Some of the statements in this release are forward-looking. These forward-looking statements may be generally identified by the use of forward-looking words and phrases such as “will”, “intends”, “may”, “believes”, “anticipates”, “should” and “expects” and are based on the Company’s current expectations or beliefs concerning future events and involve risks and uncertainties. Consequently, the Company’s actual results could differ materially. The Company undertakes no obligation to update publicly or otherwise revise any forward-looking statements, whether as a result of new information, future events or other factors that affect the subject of these statements, except where expressly required to do so by law. Among the factors that could cause results to differ materially from current expectations are: (i) the risks associated with our vertically integrated model with respect to pecans, peanuts and walnuts; (ii) sales activity for the Company’s products, such as a decline in sales to one or more key customers, or to customers generally, in some or all channels, a change in product mix to lower price products, a decline in sales of private brand products or changing consumer preferences; (iii) changes in the availability and costs of raw materials and the impact of fixed price commitments with customers; (iv) the ability to pass on price increases to customers if commodity costs rise and the potential for a negative impact on demand for, and sales of, our products from price increases; (v) the ability to measure and estimate bulk inventory, fluctuations in the value and quantity of the Company’s nut inventories due to fluctuations in the market prices of nuts and bulk inventory estimation adjustments, respectively; (vi) the Company’s ability to appropriately respond to, or lessen the negative impact of, competitive and pricing pressures; (vii) losses associated with product recalls, product contamination, food labeling or other food safety issues, or the potential for lost sales or product liability if customers lose confidence in the safety of the Company’s products or in nuts or nut products in general, or are harmed as a result of using the Company’s products; (viii) the ability of the Company to control expenses, such as transportation, compensation, medical and administrative expenses; (ix) the potential negative impact of government regulations and laws and regulations pertaining to food safety, such as the Food Safety Modernization Act; (x) uncertainty in economic conditions, including the potential for economic downturn particularly in light of the outbreak of COVID-19; (xi) the timing and occurrence (or nonoccurrence) of other transactions and events which may be subject to circumstances beyond the Company’s control; (xii) the adverse effect of labor unrest or disputes, litigation and/or legal settlements, including potential unfavorable outcomes exceeding any amounts accrued; (xiii) losses due to significant disruptions at any of our production or processing facilities or employee unavailability due to illness or quarantine; (xiv) the ability to implement our Strategic Plan, including growing our branded and private brand product sales and expanding into alternative sales channels; (xv) technology disruptions or failures, including disruptions due to employees working remotely; (xvi) the inability to protect the Company’s brand value, intellectual property or avoid intellectual property disputes; (xvii) the Company’s ability to manage successfully the price gap between its private brand products and those of its branded competitors; and (xviii) the ability of the Company to respond to or manage the outbreak of COVID-19 or other infectious diseases and the various implications thereof.
John B. Sanfilippo & Son, Inc. is a processor, packager, marketer and distributor of nut and dried fruit based products that are sold under a variety of private brands and under the Company’s Fisher®, Orchard Valley Harvest®, Squirrel Brand®, Southern Style Nuts® and Sunshine Country® brand names
JOHN B. SANFILIPPO & SON, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (Dollars in thousands, except earnings per share) |
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For the Quarter Ended |
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|
September 24,
|
September 26,
|
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Net sales |
$ |
210,273 |
$ |
217,846 |
||
Cost of sales |
170,941 |
175,598 |
||||
Gross profit |
39,332 |
42,248 |
||||
Operating expenses: |
|
|
||||
Selling expenses |
12,084 |
14,112 |
||||
Administrative expenses |
8,375 |
9,074 |
||||
Total operating expenses |
20,459 |
23,186 |
||||
Income from operations |
18,873 |
19,062 |
||||
Other expense: |
|
|
||||
Interest expense |
450 |
521 |
||||
Rental and miscellaneous expense, net |
432 |
404 |
||||
Other expense |
630 |
566 |
||||
Total other expense, net |
1,512 |
1,491 |
||||
Income before income taxes |
17,361 |
17,571 |
||||
Income tax expense |
4,549 |
4,645 |
||||
Net income |
$ |
12,812 |
$ |
12,926 |
||
Basic earnings per common share |
$ |
1.12 |
$ |
1.13 |
||
Diluted earnings per common share |
$ |
1.11 |
$ |
1.12 |
||
Cash dividends declared per share |
$ |
2.50 |
$ |
3.00 |
||
|
|
|
|
|
||
Weighted average shares outstanding |
|
|
|
|
||
-- Basic |
|
11,477,287 |
|
11,444,560 |
||
-- Diluted |
|
11,550,587 |
|
11,538,976 |
JOHN B. SANFILIPPO & SON, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Dollars in thousands, except per share amounts) |
||||||||||||
|
|
September 24,
|
|
June 25,
|
|
September 26,
|
|
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ASSETS |
|
|
|
|
|
|
|
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CURRENT ASSETS: |
|
|
|
|
|
|
|
|||||
Cash |
|
$ |
743 |
|
$ |
1,535 |
|
$ |
887 |
|
||
Accounts receivable, net |
|
69,881 |
|
56,953 |
|
60,474 |
|
|||||
Inventories |
|
150,371 |
|
172,068 |
|
156,453 |
|
|||||
Prepaid expenses and other current assets |
|
6,353 |
|
8,315 |
|
5,291 |
|
|||||
|
|
227,348 |
|
238,871 |
|
223,105 |
|
|||||
|
|
|
|
|
|
|
|
|||||
PROPERTIES, NET: |
|
126,328 |
|
123,797 |
|
126,037 |
|
|||||
|
|
|
|
|
|
|
|
|||||
OTHER LONG-TERM ASSETS: |
|
|
|
|
|
|
|
|||||
Intangibles, net |
|
21,197 |
|
21,775 |
|
23,604 |
|
|||||
Deferred income taxes |
|
6,987 |
|
6,788 |
|
5,972 |
|
|||||
Operating lease right-of-use assets |
|
4,201 |
|
4,351 |
|
5,170 |
|
|||||
Other |
|
10,697 |
|
11,875 |
|
9,334 |
|
|||||
|
|
43,082 |
|
44,789 |
|
44,080 |
|
|||||
|
|
$ |
396,758 |
|
$ |
407,457 |
|
$ |
393,222 |
|
||
|
|
|
|
|
|
|
|
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LIABILITIES & STOCKHOLDERS' EQUITY |
|
|
|
|
|
|
|
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CURRENT LIABILITIES: |
|
|
|
|
|
|
|
|||||
Revolving credit facility borrowings |
|
$ |
44,168 |
|
$ |
27,008 |
|
$ |
16,042 |
|
||
Current maturities of long-term debt |
|
4,372 |
|
5,285 |
|
7,385 |
|
|||||
Accounts payable |
|
41,441 |
|
36,323 |
|
52,365 |
|
|||||
Bank overdraft |
|
85 |
|
2,041 |
|
1,302 |
|
|||||
Accrued expenses |
|
27,569 |
|
41,511 |
|
27,313 |
|
|||||
|
|
117,635 |
|
112,168 |
|
104,407 |
|
|||||
|
|
|
|
|
|
|
|
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LONG-TERM LIABILITIES: |
|
|
|
|
|
|
|
|||||
Long-term debt |
|
13,780 |
|
14,730 |
|
18,152 |
|
|||||
Long-term operating lease liabilities |
|
2,807 |
|
2,990 |
|
3,774 |
|
|||||
Retirement plan |
|
31,860 |
|
31,573 |
|
24,974 |
|
|||||
Other |
|
7,377 |
|
7,758 |
|
7,865 |
|
|||||
|
|
55,824 |
|
57,051 |
|
54,765 |
|
|||||
|
|
|
|
|
|
|
|
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STOCKHOLDERS' EQUITY: |
|
|
|
|
|
|
|
|||||
Class A Common Stock |
|
26 |
|
26 |
|
26 |
|
|||||
Common Stock |
|
89 |
|
89 |
|
89 |
|
|||||
Capital in excess of par value |
|
124,521 |
|
123,899 |
|
122,890 |
|
|||||
Retained earnings |
|
108,185 |
|
124,058 |
|
117,293 |
|
|||||
Accumulated other comprehensive loss |
|
(8,318 |
) |
(8,630 |
) |
(5,044 |
) |
|||||
Treasury stock |
|
(1,204 |
) |
(1,204 |
) |
(1,204 |
) |
|||||
|
|
223,299 |
|
238,238 |
|
234,050 |
|
|||||
|
|
$ |
396,758 |
|
$ |
407,457 |
|
$ |
393,222 |
|