J+J Snack Foods: Reports Q1-2022 Sales and Earnings

Pennsauken / NJ. (jj) J+J Snack Foods Corporation reported financial results for the first quarter 2022, that ended in Camden County on December 25, 2021.

Q1-2022 Actuals Change
.
Net Sales USD 318.5 million 32.2 %
Operating Income USD 14.8 million 2468 %
Net Earnings USD 11.1 million 524 %
Earnings per Diluted Share (EPS) USD 0.58 520 %

President and CEO Dan Fachner: «Our first quarter fiscal 2022 results reflect a continuation of positive consumer trends and healthy demand for our products even as the spread and impact of Covid-19 accelerated throughout the quarter. Net sales increased 32 percent year-over-year and by 17 percent versus the same period in fiscal 2019, led by strong results from our core products including pretzels and churros, frozen novelties, as well as sales exceeding pre-pandemic levels in our frozen beverages segment. The Food Service segment grew 32 percent, compared to the prior year period, while the Retail and Frozen Beverages segments grew 9 percent and 54 percent, respectively. Overall, our first quarter sales performance demonstrates ongoing strength and our belief of the tremendous growth potential of our business in both the near- and long-term as we move deeper into a post-pandemic recovery.

«As was the case last quarter, our industry continues to experience unprecedented inflationary pressures and higher-than-expected cost increases across many facets of the business, from raw materials and ingredients, to transportation, packaging and labour. First quarter fiscal 2022 gross margin was 25 percent, favourably comparing to 21 percent for the prior year, but below the 28 percent gross margin generated in the comparable 2019 period. Our organization continues to focus on specific actions to offset the short-term cost challenges and we have identified a number of opportunities to reduce expenses across our business, including procurement, R+D, production and distribution. In addition, we have four new production lines scheduled to be activated in fiscal 2022 that will leverage automation to improve efficiencies. Finally, we are also implementing additional price increases for our products across nearly all of our categories. Collectively, we expect these initiatives to improve our gross margins progressively over the second quarter of fiscal 2022 and into the back-half of the fiscal year.

«With a strong balance sheet and liquidity position, we have the financial flexibility to continue making select return-focused strategic investments in sales, marketing and product innovation to further J+J’s position as a leader in the snack foods segment. We are also actively evaluating inorganic, accretive growth opportunities that complement our existing product portfolio and bring added value to our shareholders. We are confident that our continued execution on these strategic priorities is positioning J+J Snack Foods for continued near- and long-term growth and success, particularly as economic trends further improve and segments of our of business such as theatres, amusement parks and outdoor events continue their recovery.

«I believe our future is exceedingly bright as we leverage our unique and valuable assets, including some of the most powerful and enduring brands in the snack food industry, brands that are real and sustainable and have been time tested. This year, J+J Snack Foods is celebrating the 50th anniversary of its founding, highlighting our transformational growth and success over five decades driven by a disciplined approach toward managing the business and an organization-wide commitment to ‘serving fun’ to our customers. We are determined to continue that trend in 2022 and beyond.»

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