Inventure Foods, Inc., a specialty food marketer and manufacturer, reported record financial results for the first quarter ending March 31, 2012, highlighted by double-digit net revenue growth in both the snack and frozen segments and record first quarter earnings of $0.09 per fully diluted share.
Inventure generated record net revenues of $47.0 million for the first quarter, an increase of 28.3 percent, or $10.4 million versus the prior-year first quarter, attributable to strong performance in both the Snack and Frozen segments.
The snack segment posted an 11.3 percent, increase to $24.2 million in net revenue compared to the same quarter a year ago. T.G.I. Friday's® led the segment with strong sales growth of 18.0 percent,, while Boulder Canyon Natural Foods™ was up 13.1 percent, and private label increased 17.2 percent. These gains were partially offset by declines in the company's other smaller brands.
Frozen segment net revenues, which includes Jamba® All Natural Smoothies, totaled $22.8 million for the quarter, up 53.1 percent, over the prior-year period. Excluding Jamba®, the Frozen segment net revenues increased 50.7 percent, for the quarter driven by competitive pricing against other berry segments, continued category growth and new distribution. Jamba® net revenues for the quarter totaled $3.5 million ($4.9 million gross), an increase of 68.1 percent, compared to net revenues of $2.1 million ($2.5 million gross) in the first quarter last year, due to increased retail distribution and consumer demand.
Consolidated net income for the quarter grew 22.4 percent, and totaled $1.7 million, or $0.09 per fully diluted share, compared to $1.4 million, or $0.08 per fully diluted share, in the first quarter of 2011.
Consolidated EBITDA for the quarter was $4.0 million, or 8.5 percent, of net revenue, an increase of 14.2 percent, compared to the first quarter of last year. A table reconciling EBITDA to net income is presented at the end of the consolidated financial statements included in this release.
Other first quarter financial highlights included:
Gross profit of $9.3 million, or 19.9 percent, of net revenues, was up 17.8 percent, in dollars, but declined 170 basis points compared to last year. This decline in gross margin was primarily due to higher cost of goods sold in the company's frozen segment, generated by increased cost of purchased berries in order to meet growing demand. Gross profit was also affected by an increase of $1.8 million in above-the-line product support spending such as trade promotions, coupons and slotting fees, primarily for the Jamba® and Boulder Canyon™ brands.
Selling, general and administrative (SG&A) expenses totaled $6.5 million for the quarter, an increase of $1.0 million. SG&A, as a percent of net revenues, was down 120 basis points to 13.8 percent,, compared to the first quarter of the prior year. The increase in SG&A expense was largely due to higher variable broker commissions on increased sales volume, as well as continued investments in Jamba® and Boulder Canyon™, including increased marketing and sampling expenses.
"This quarter marks another record-setting milestone in our company's history, as the recent financial results further affirm the growing consumer demand for our innovative products," said Terry McDaniel, chief executive officer of Inventure Foods in a prepared statement. "We were very pleased to see the momentum continue in both the snack and frozen segments as we delivered year-over-year revenue and earnings growth. Our healthy/natural portfolio now represents 61 percent, of total revenue, having increased 45 percent, from the first quarter of 2011."
"Our investments made during the prior year to support both our brands and our operations are beginning to pay dividends. We remain committed to supporting the success of our brands. Jamba® continues to demonstrate positive results from those investments, delivering $4.9 million in gross revenues this quarter. Our Boulder Canyon™ products grew 13 percent, for the quarter, in part from continued momentum of the brand as well as new offerings in the portfolio. We are also excited by the continued growth of our T.G.I. Friday's® and private label brands, which grew 18 percent, and 17 percent,, respectively."
McDaniel concluded: "We are very pleased with the first quarter results, posting our highest quarterly net revenues and earnings per share. We remain focused on executing our strategic plan, while adding value to our shareholders through sustainable long-term growth."