Coffee Holding Co., Inc. announced its operating results for the year ended Oct. 31, 2013.
The company had a net loss of $1,480,235, or $0.23 per share basic and diluted, for the fiscal year ended Oct. 31, 2013 compared to a net income of $2,485,677, or $0.39 per share basic and $0.37 diluted for the fiscal year ended Oct. 31, 2012. The decrease in net income reflects the increased realized loss and decreased unrealized gains on hedging activities during the fiscal year.
Net sales totaled $133,980,759 for the fiscal year ended Oct. 31, 2013, a decrease of $39,675,456, or 22.8 percent, from $173,656,215 for the fiscal year ended Oct. 31, 2012. The decrease in net sales reflects an approximate 60 percent lower commodity price during the fiscal year which resulted in a decrease in the price per pound of coffee sold.
Cost of sales for the fiscal year ended Oct. 31, 2013 was $128,011,678, or 95.5 percent of net sales, as compared to $161,649,282, or 93.1 percent, of net sales for the fiscal year ended Oct. 31, 2012. Cost of sales consists primarily of the cost of green coffee and packaging materials and realized and unrealized gains or losses on hedging activity. The increase in cost of sales primarily reflects our lower green coffee prices offset by increased realized losses and decreased unrealized gains on hedging activities. Cost of sales includes purchases of approximately $31.2 million and $31.9 million in fiscal years 2013 and 2012, respectively, from a related party.
Gross profit for the fiscal year ended Oct. 31, 2013 was $5,969,081, a decrease of $6,037,852 from $12,006,933 for the fiscal year ended Oct. 31, 2012. Gross profit as a percentage of net sales decreased to 4.5 percent for the fiscal year ended Oct. 31, 2013 from 6.9 percent for the fiscal year ended Oct. 31, 2012 due to net realized hedging losses and unrealized hedging gains of $6,208,648 and $383,349, respectively, during fiscal 2013 as compared to net realized and unrealized hedging losses and gains of $667,302 and $500,169, respectively, during fiscal 2012.
Total operating expenses decreased $85,359, or 1.1 percent, to $7,521,910 for the fiscal year ended Oct. 31, 2013 from $7,607,269 for the fiscal year ended Oct. 31, 2012. Selling and administrative expenses increased $39,620, or 0.6 percent, to $6,939,819 for the year ended Oct. 31, 2013 from $6,900,199 for the year ended Oct. 31, 2012. Officers' salary decreased $124,979 or 17.7 percent to $582,091 for the year ended Oct. 31, 2013 from $707,070 for the year ended Oct. 31, 2012.
