Inventure Foods, Inc., a leading specialty food marketer and manufacturer, reported financial results for the first quarter ended March 30, 2013 highlighted by quarterly net revenues of $48.5 million.
Consolidated net revenues for the first quarter were $48.5 million, an increase of 3.2 percent, compared to $47.0 million during the prior-year period. Comparability of our current period net revenues was affected by the prior year sale of the direct store delivery (DSD) business. Excluding the impact of the sale of the DSD business, our consolidated revenues were up 5.8 percent. Net revenues during the first quarter of 2013 were supported by a 15.3 percent growth in the healthy/natural portfolio over the prior-year period. Gross profit decreased 5.6 percent to $8.8 million, compared to $9.3 million in the prior-year period. Gross profit margin declined 170 basis points to 18.2 percent from 19.9 percent last year primarily due to a decrease in sales of our T.G.I. Friday's® products in the Snack segment. Selling, general and administrative expenses increased 50 basis points to 14.3 percent of net revenues compared to 13.8 percent last year primarily due to sampling expenses incurred for a non-recurring mass merchandiser event for our T.G.I. Friday's® brand. Net income decreased 38.7 percent to $1.1 million, resulting in a corresponding decrease in fully diluted earnings per share to $0.05, and earnings before interest, taxes and amortization (EBITDA) decreased 23.0 percent, to $3.1 million, or 6.4 percent of net revenues.
Frozen segment net revenues totaled $26.6 million for the quarter, an increase of 16.8 percent over the prior-year period. Net revenues of frozen berries increased 21.4 percent for the quarter due to continued sales growth of our branded frozen fruit. Jamba® net revenues decreased 8.7 percent to $3.2 million for the quarter, largely attributed to timing of temporary rotations in the club channel. Excluding the club channel, Jamba® net revenues increased 25.4 percent for the quarter.
Snack segment net revenues of $21.9 million in the quarter were down 9.5 percent, compared to $24.2 million during the prior-year period. Snack segment net revenues in the current year were also affected by the prior year sale of the DSD business. Excluding the impact of the sale of the DSD business, our Snack segment revenues were down 5.0 percent. T.G.I. Friday's® net revenues decreased 16.1 percent during the quarter, which were partially offset by a 12.8 percent increase in sales of Boulder Canyon Natural Foods® and a 17.3 percent increase in sales of premium private label products.
"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. However, we maintain our outlook to achieve positive revenue and earnings growth for the full year," said Terry McDaniel chief executive officer of Inventure Foods, Inc in a prepared statement.
McDaniel continued, "we continue to see strong growth in our healthy/natural portfolio of products, which now makes up 68 percent 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. 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."
"With our newly restructured debt agreement, we are well positioned to fund new acquisitions and future growth. This includes our recently announced plan to purchase Oregon based berry processing business, Willamette Valley Fruit Company. This proposed acquisition will help us meet growing consumer demand for berries and will bring additional operational synergies. This will also provide additional freezing capabilities, packaging capacities and a presence in another geographic location. Other future growth opportunities underway include a large national co-packing partnership agreement with a highly reputable snack food company. More details surrounding this agreement are anticipated to be announced in the second quarter," concluded McDaniel.