Jamba, Inc. (NASDAQ:JMBA) today reported unaudited financial results for the second fiscal quarter ended July 1, 2014. Jamba® recorded quarterly comparable store sales (1) increases for company-owned and franchise-operated stores, driven by the expansion of Jamba’s fresh-squeezed juice and whole food blending platform.
Juice and whole food blending was introduced to 376 stores during the quarter as a result of the accelerated national rollout, bringing the new platform to a total of 508 Jamba units by quarter end. The juice platform, which was available for only one month during the quarter in most units, is on target to add 300-400 basis points to sales based upon store sales to date. Beyond juice, Jamba continued its global growth with 19 units opened in domestic and international markets, putting the Company on track to reach its annual target of 60-80 new units. The Company also made progress on its refranchising efforts / transition to an asset-light model and decreased the number of company operated stores to 258 at quarter end. This transition helped contribute to our reduction in general and administration (G&A) expense by 6.4% year-over-year to $9.6 million.
Highlights for the 13 weeks ended July 1, 2014, compared to the 13 weeks ended July 2, 2013:
- Company-owned comparable store sales (1) increased 2.5% for the quarter compared to the prior year period.
- System-wide comparable store sales (1) increased 2.2% and franchise-operated comparable store sales (1) rose 2.0% for the quarter compared to the prior year period.
- Net income was $6.4 million, or $0.36 diluted earnings per share for the quarter, flat compared to the prior year period. On a non-GAAP basis excluding one-time costs relating to the Company’s juice launch, adjusted net income (2) was $7.7 million, or $0.44 diluted earnings per share for the quarter, an increase of 22.2%.
- Total revenue decreased 5.4% to $64.2 million compared to total revenue of $67.8 million for the prior year period, primarily caused by a decrease in the number of company-owned stores due to the Company’s refranchising initiatives.
- Income from operations was $6.6 million, flat with the prior year period. Operating margin improved by 60 basis points to 10.3% for the second quarter of 2014. On a non-GAAP basis excluding one-time costs relating to the Company’s juice launch, adjusted income from operations (2) was $8.0 million, an increase of $1.4 million.
- General and administration expense decreased 6.4% to $9.6 million compared with $10.2 million for the prior year period. On a non-GAAP basis excluding one-time costs relating to the Company’s juice launch, adjusted general and administration expense (2) was $9.3 million, a decrease of $1.0 million.
- Global development continued with franchisees opening 19 Jamba Juice stores -- 13 domestically, including one Smoothie Station, and six in International markets. At quarter end, there were 857 stores globally; 258 company stores, 551 domestic franchise stores and 48 international franchise stores.
- 376 stores launched fresh-squeezed juice in the quarter – 120 Company-owned stores and 256 franchise-operated units.
- By mid-July, the Jamba Insider Rewards™ loyalty program enlisted more than one million members in less than five months, outpacing the rate of other industry leaders. At the same time, the ISIS® mobile wallet was used for one million transactions to redeem free Jamba® smoothies and juices.
“Our second-quarter marked a significant milestone for Jamba as we continue to successfully execute on our U.S. growth strategy and drive shareholder value. Our fresh-squeezed juice and whole food blending platform is now in more than 500 stores across the U.S. While we’re in the very early days of this national rollout, we are very pleased with the marketplace excitement, consumer acceptance and incremental sales generated by this initiative,” said James D. White, chairman, president and CEO of Jamba, Inc.