A slowing in the T.G.I. Friday’s brand coupled with increased brand investment crimped earnings at Inventure Foods, Inc. in the first quarter of fiscal 2013. Net income in the quarter ended March 30 was $1,056,000, equal to 5c per share on the common stock, down 39% from $1,722,000, or 9c per share, in the same period a year ago.
Sales for the quarter were $48,537,000, up 3% from $47,020,000 during the same period of the previous year.
“We experienced some disappointments in our first-quarter results, largely driven by a slowing in the T.G.I. Friday’s brand and increased brand investment, which we referred to in our last call, resulting in lower-than-expected earnings for the quarter,” said Terry McDaniel, chief executive officer. “However, we maintain our outlook to achieve positive revenue and earnings growth for the full year.”
Mr. McDaniel said Inventure continues to see strong growth in its healthy/natural portfolio of products, which now makes up 68% of total net revenues.
“Our healthy/natural portfolio net revenues grew due to sustained demand for our frozen fruit products and continued growth of our Boulder Canyon products,” he said. “Our Boulder Canyon brand generated its highest quarterly net revenues this quarter, which is reflective of our dedicated team’s effort the past several months. We also began shipping and incurring brand investments for our Seattle’s Best Coffee frozen coffee blends to select retailers near the end of the first quarter. We remain optimistic about the incremental benefits this new product line will bring as we continue our phased roll out.”
Mr. McDaniel said a newly restructured debt agreement has positioned Inventure to fund new acquisitions and future growth, including the recently announced planned purchase of Salem, Ore.-based berry processing business, Willamette Valley Fruit Co.
“This proposed acquisition will help us meet growing consumer demand for berries and will bring additional operational synergies,” Mr. McDaniel said. “This will also provide additional freezing capabilities, packaging capacities and a presence in another geographic location.”
Other future growth opportunities under way include a large national co-packing partnership agreement with a highly reputable snack food company, he said.
Inventure’s snack division net revenue fell nearly 10% over the same quarter a year ago to $21.9 million. T.G.I. Friday’s brand sales decreased 16% in the quarter, partially offset by a 13% increase in sales of Boulder Canyon Natural Foods and a 17% increase in sales of premium private label products.
Frozen segment net sales, which include Jamba All Natural Smoothies, totaled $26.6 million in the first quarter, up 17% from the same period a year ago. Jamba net sales for the quarter totaled $3.2 million, down 9% from the same period a year ago. Net revenues of frozen berries increased 21% due to continued sales growth of branded frozen fruit.
