June July news

NAMA profit report: 2011 challenged operators’ profits

The National Automatic Merchandising Association (NAMA) 2012 profit report indicated vending operators posted less profit on a percentage basis in 2011 than 2010, reversing a positive trend from 2009. Pre-tax profit fell from 2.4 percent among companies with more than $2 million in annual sales to 2.0 percent in 2011.

The tables and graphs in the report present a guide for analyzing profitability and 84 participating operators.

In 2011, for companies with more than $2 million in annual sales, cost of goods increased, gross margin decreased, operating expenses as a percent of sales were same, sales per employee increased but profit before taxes decreased and pre-tax return on assets decreased.

The operators participating in the NAMA report once again outperformed the industry as a whole in 1-year sales change, based on the Automatic Merchandiser State of the Vending Industry Report. NAMA noted that sales growth was 4.8 percent among these firms, reflecting an emergence from the recession. However, the directional change has been similar among both groups, with sales having progressively improved for the past three years. The NAMA report indicates operators gained productivity from employees but could not translate that into higher profitability. NAMA noted the main source of the minor slippage was among the high-profit firms whose bottom-line profit fell from 8.7 percent to 5.9 percent.

In past years the larger the firm, the higher the level of profit, NAMA noted. In 2011, this pattern was true until the very largest group of firms, those with over $20 million in sales. This group had a dramatic fall-off in profit from 2.6 percent of sales to 1.0 percent. For companies with sales below $2 million, the typical operator posted a 7 percent increase in sales and a 3.4 percent pre-tax profit margin, NAMA noted.

For information on the report, call 312-346-0370.

New York City mayor seeks to restrict large size drinks

New York City Mayor Michael Bloomberg announced plans to enact a far-reaching ban on the sale of large sodas and other sugary drinks at restaurants, movie theaters and street carts, in the most ambitious effort yet by the Bloomberg administration to combat rising obesity. The plan does not include grocery stores, convenience stores or vending machines.

The National Restaurant Association and the American Beverage Association were exploring legal means to prevent the ban.

Farley & Sathers and Ferrara Pan to merge

Farley’s & Sathers Candy Co., Inc. and Ferrara Pan Candy Co., Inc. announced a definitive merger agreement under which the two companies will combine to create a general line candy manufacturer. The combined company, Ferrara Candy Co., Inc., will maintain the century-old Ferrara name and will be led by longtime industry leader Salvatore Ferrara II, the chairman and CEO of Ferrara Pan. Terms of the transaction were not disclosed.

ConAgra buys pita chips from Kangaroo, will buy Odom’s Tennessee Pride

ConAgra Foods, Inc. acquired Kangaroo Brands’ pita chip business. ConAgra Foods’ acquisition of the pita chip business is consistent with its strategy to grow its presence in private label foods. ConAgra Foods, Inc. has agreed to acquire Odom’s Tennessee Pride, a producer of frozen and refrigerated breakfast sandwiches and sausage.

Flowers Foods to buy Lepage Bakeries

Flowers Foods, Inc. announced an agreement to acquire Lepage Bakeries, Inc., of Auburn, Me. for $370 million in cash and stock. Flowers expects to complete the transaction in its fiscal second quarter, pending necessary regulatory approvals.

Monique Terrazas rejoins AM as publisher

Monique Terrazas has rejoined Automatic Merchandiser as publisher, replacing Gary Thom, who left to pursue other interests.

Terrazas was an account executive with Automatic Merchandiser from 2004 to 2006. She has been with Cygnus Business Media for more than 12 years and has held various roles within the organization. She brings a heavy background in digital and social media. She can be reached at [email protected].

Canteen franchise buys Williams Food Service

Canteen Service Co. of Kentuckiana, a Canteen franchise based in Owensboro, Ky., recently purchased the assets of Williams Food Service, which provided mobile catering and full-line food and beverage vending services in the Louisville region since 1928.

Fresh Brew Vending buys Tri-Cities

FreshBrew Vending, a subsidiary of FreshBrew Group, has acquired Beaumont, Texas’s largest vending company, Tri-Cities Vending, in an effort to begin expanding its Houston operations.

Wichita Vending buys Wichita Canteen

Wichita Vending recently acquired Wichita Canteen, which served the Wichita, Kan. market for 50 years.

H.I.G. buys Compass correctional business

H.I.G. Capital completed the acquisition of the correctional services business, Trinity, of Compass Group PLC, which operates under the brand names Trinity Services Group and Canteen Corrections.

Seaga partners with Fresh Healthy Vending

Seaga announced its partnership in North America with Fresh Healthy Vending. Together the companies will be offering the Fresh Healthy Vending Café version of the company’s Saeco Diamante vending machine model. This partnership comes just one year after its North American entry into the Saeco line of gourmet espresso and coffee equipment.