Inventure Foods, Inc. reported financial results for the third quarter ended Sept. 29, 2012. Consolidated net revenues for the third quarter were $46.6 million, an increase of 24.2 percent compared to $37.5 million during the prior-year period. This increase was largely driven by a 41.5 percent increase in the healthy/natural portfolio. Gross profit increased 47.8 percent to $9.5 million, compared to $6.4 million in the prior-year period. Gross profit margin improved 320 basis points to 20.3 percent from 17.1 percent last year, primarily as a result of lower cost berries in the frozen segment. Selling, general and administrative expenses decreased to 14.0 percent of net revenues, or 360 basis points, compared to 17.6 percent in the prior year. This decline is primarily attributable to decreased marketing and sampling expenses related to the prior-year promotions for the Jamba® brand. Net income increased to $1.7 million compared to a net loss of $0.2 million in the prior year.
The snack segment net revenues were up 1.4 percent with $23.8 million in the third quarter of 2012 compared to $23.5 million during the same period a year ago. T.G.I. Friday's® and premium private label net revenues increased 10.7 percent and 20.9 percent, respectively, offset by a 13.2 percent decrease in sales of Boulder Canyon Natural Foods®.
The frozen segment net revenues, which includes Jamba® All Natural Smoothies, totaled $22.8 million for the quarter, were up 62.3 percent over the prior-year period. Continuing the momentum from the first half of 2012, net revenues for the Frozen segment excluding Jamba® increased 72.7 percent for the quarter due to continued growth in branded and private label sales to new and existing customers. Jamba® net revenues for the quarter totaled $4.3 million, an increase of 28.6 percent compared $3.3 million in the third quarter of 2011.
Year-to-Date Overview
Consolidated net revenues for the nine months ended Sept. 29, 2012 were $141.6 million, an increase of 20.3 percent compared to $117.8 million during the prior-year period. This increase was largely driven by a 33.2 percent increase in the healthy/natural portfolio, as well as a 4.7 percent increase in the indulgent/specialty portfolio revenues. Gross profit increased 24.9 percent to $28.0 million, compared to $22.4 million in the prior-year period. Net income increased 145.0 percent to $5.1 million, compared to net income of $2.1 million in the prior year. Fully diluted earnings per share for the first nine months of 2012 were $0.26, versus $0.11 during the same period in 2011, an increase of 136.4 percent. Consolidated earnings before interest, depreciation and amortization (EBIDA) increased 68.6 percent to $12.1 million, or 8.5 percent of net revenues.
"Continuing the success realized during the first half of 2012, we are pleased to report our ninth consecutive quarter of double-digit growth in year-over-year net revenues and record third quarter earnings per share," said Terry McDaniel, chief executive officer of Inventure Foods, Inc., in a prepared statement.
"The increase in our healthy/natural portfolio, which represents 60 percent of total revenues, was led by strong increases in our frozen segment with frozen fruit sales up 72.7 percent and Jamba "at home" Smoothie sales up 28.6 percent over prior year, primarily due to increased distribution to new and existing customers and increased velocity of existing business."
"The increase in the healthy/natural portfolio was partially offset by a decline in sales of our Boulder Canyon products primarily due to increased pricing pressure. We remain dedicated to the growth of our Boulder Canyon brand. We are adding sales and marketing resources dedicated to the Boulder brand to regain our momentum and we plan to introduce new categories beyond salty snacks within the next year. We also look forward to leveraging the new distribution partnership with Snyder's-Lance to push Boulder and other Inventure product lines in certain markets."
"Increased sales in our indulgent snack product portfolio were primarily driven by sales of our T.G.I. Friday's products, which were up 10.7 percent over the same quarter last year and the success of our new Nathan's Famous brand. Our Nathan's Famous products have been well received since we introduced them during the fourth quarter of 2011. In fact, our Nathan's Famous Honey Mustard Crunchy Crinkle Fries were recently awarded the 2012 Best New Product award in the salty snacks category by the Convenience Store News. Considering the variety of snacks and number of competitors in this channel, we are very honored to receive this recognition."
McDaniel concluded, "We are pleased with the double-digit growth in both revenues and profits achieved year-to-date. We remain focused on executing our strategic plan and delivering sustainable long-term growth for our shareholders."
