Jamba, Inc. Reports Net Income of $2.8 Million for Fiscal Third Quarter 2009
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Consolidated EBITDA Improvement of Over 300 Percent
Rescheduling of the Company's Third Quarter 2009 Earnings Conference Call
EMERYVILLE, Calif.--(BUSINESS WIRE)-- Jamba, Inc. (NASDAQ: JMBA) today reported financial results for the fiscal third quarter ended October 6, 2009.
Financial and Operational Highlights
Highlights for the 12 weeks ended October 6, 2009, compared to the 12 weeks ended October 7, 2008:
-- Consolidated EBITDA* increased 308% to $7.0 million from $1.7 million
for 3Q08, reflecting an increase of $5.3 million.
-- Store-level EBITDA* improved $2.1 million to $15.9 million from $13.8
million for 3Q08, reflecting an improvement of 15.1%.
-- Total revenue for 3Q09 decreased $7.1 million to $79.0 million from
$86.1 million for 3Q08, a decrease of 8.2%.
-- Net income for 3Q09 of $2.8 million showed significant improvement when
compared to a net loss for 3Q08 of $(12.4) million.
-- Diluted earnings per share for 3Q09 of $0.04 compared to a diluted loss
per share for 3Q08 of $(0.23).
-- Company-owned comparable store sales for 3Q09 declined 5.3%(1) but
reflected an 800 basis point sequential improvement over 2Q09 comparable
store sales.
-- 10 new franchise stores and one new company-owned store were opened
during the fiscal third quarter of 2009, bringing the store count to 742
stores system-wide, of which 254 are franchise stores and 488 are
company-owned stores.
"We continued to make solid progress throughout the quarter in several strategically important areas, including food, franchise development, brand licensing, cost management and operating efficiency. Our performance reflected this progress with improvement quarter over quarter in 2009 in our comparable store sales and EBITDA gains," said James D. White, president and chief executive officer, Jamba, Inc. "We achieved the gains despite the slow pace of economic recovery and continued high unemployment in California where Jamba has a concentrated store presence."
"I am especially pleased with our food initiative," continued Mr. White. "Food is now present with full or limited offerings in 377 stores. As an early indicator of progress, system-wide our stores with food are showing a 200-400 basis point improvement in comparable store sales over our non-food stores. We believe our future performance will be boosted by a recently launched marketing campaign, the 'Feel Good Campaign,' which is Jamba's most comprehensive effort ever. The 'Feel Good Campaign' is a multi-faceted, integrated campaign that is already driving additional traffic."
"We opened 10 new campus locations, which gives us brand presence on over 30 college and university campuses across the nation, and one new company store in California. We also recently completed the sale of eight company stores to current franchise operators in conjunction with our goal of refranchising up to 150 Company-owned stores by the close of 2010," concluded Mr. White.
Outlook for 2009
The Company is tracking against targeted 2009 expense goals as follows:
-- Cost of sales at or below 26% of company store revenue;
-- Labor costs at or below 34% of company store revenue;
-- Other controllable expenses included in store operating, at or below
3.5% of company store revenue; and
-- General and administrative costs at or below $35 million, before
share-based compensation expense.
Outlook for 2010
The Company plans to achieve the following in 2010:
-- Deliver positive comparable store sales;
-- Build on Jamba's disciplined approach to expense management and cost
savings including reducing G&A by 10-12 percent (excluding share-based
compensation);
-- Deliver consolidated EBITDA of 5-7 percent;
-- Deliver store level EBITDA of 15-17 percent;
-- Grow via franchise development by adding up to 50 franchise stores and
expanding into one major international market;
-- Execute additional licensing agreements in relevant categories; and
-- Complete the refranchising initiative of up to 150 company-owned stores
started in 2009.
The Company will continue to be focused on efforts to improve sales and build a sustainable business model for growth throughout 2010.
Liquidity
On October 6, 2009, the Company held $32.1 million in cash, cash equivalents, and restricted cash. The restricted cash balance was $2.7 million. The Company eliminated all debt for borrowed money with the convertible preferred stock transaction announced on June 1, 2009.
Footnotes
(1) Comparable store sales are calculated using sales of stores open at least thirteen full fiscal periods. Management reviews the increase or decrease in comparable store sales compared with the same period in the prior year to assess business trends and make certain business decisions.
* Use of Non-GAAP Financial Measures
The Company uses the non-GAAP financial measures of consolidated EBITDA and store-level EBITDA in its statements made in this release. The Company defines consolidated EBITDA as store-level EBITDA including general and administrative expenses. The Company believes that consolidated EBITDA is a helpful indicator of the Company's financial performance. The Company defines store-level EBITDA, as net income (loss) from operations and other income less: (a) depreciation and amortization, (b) general and administrative expenses; (c) store pre-opening expenses; (d) trademark impairment; (e) store lease termination and closure expenses; (f) impairment of long-lived assets; (g) other operating expenses and (h) income taxes. Consolidated EBITDA and store level EBITDA are not measurements determined in accordance with GAAP and should not be considered in isolation or as an alternative to income (loss) from operations or net income (loss) as indicators of financial performance. Each non-GAAP financial measure used as presented may not be comparable to other similarly titled measures used by other companies. For a reconciliation of consolidated EBITDA to net income (loss) and store-level EBITDA to net income (loss), please see the tables at the end of this release.
Rescheduled Webcast and Conference Call Information
Due to a scheduling conflict, the Company has rescheduled its previously announced earnings conference call for tomorrow, November 12, 2009, at 5:00 p.m. ET to tomorrow, November 12th, at 11:00 a.m. ET. Participating on the call will be James D. White, president and chief executive officer and Karen Luey, senior vice president and chief financial officer. The conference call numbers have been changed and can be accessed live over the phone by dialing (877) 941-8416 or for international callers by dialing (480) 629-9812. The conference call replay can be accessed live over the phone by dialing (800) 406-7325 or (303) 590-3030 for international callers; the pin number is 4176619. A simultaneous webcast of the call will be available by visiting the investor relations section at http://www.jambajuice.com. A replay will be available until December 3, 2009.
About Jamba, Inc.
Jamba, Inc. (NASDAQ: JMBA) is a holding company and through its wholly-owned subsidiary, Jamba Juice Company, owns and franchises JAMBA JUICE(R) stores. Founded in 1990, Jamba Juice is a leading restaurant retailer of better-for-you food and beverage offerings, including great tasting fruit smoothies, juices, and teas, hot oatmeal made with organic steel cut oats, wraps, salads, sandwiches, and California Flatbreads(TM), and a variety of baked goods and snacks. As of October 6, 2009, Jamba Juice had 742 locations consisting of 488 company-owned and operated stores and 254 franchise stores. For the nearest location or a complete menu, visit the Jamba Juice website at www.jambajuice.com or call 1-866-4R-FRUIT.
Forward-Looking Statements
This press release (including information incorporated or deemed incorporated by reference herein) contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are those involving future events and future results that are based on current expectations, estimates, forecasts, and projects as well as the current beliefs and assumptions of our management. Words such as "outlook", "believes", "expects", "appears", "may", "will", "should", "anticipates", "plans to achieve", or the negative thereof or comparable terminology, are intended to identify such forward looking statements. Any statement that is not a historical fact, including estimates, projections, future trends and the outcome of events that have not yet occurred, is a forward-looking statement. Forward-looking statements are only predictions and are subject to risks, uncertainties and assumptions that are difficult to predict. Therefore actual results may differ materially and adversely from those expressed in any forward-looking statements. Factors that might cause or contribute to such differences include, but are not limited to, those discussed under the section entitled "Risk Factors" in our reports filed with the SEC. Many of such factors relate to events and circumstances that are beyond our control. You should not place undue reliance on forward-looking statements. The Company does not assume any obligation to update the information contained in this press release.
JAMBA, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
October 6, December 30,
(In thousands, except share and per share amounts) 2009 2008
ASSETS
Current assets:
Cash and cash equivalents $ 29,421 $ 20,822
Restricted cash 1,530 5,059
Receivables, net of allowances of $117 and $416 1,697 4,594
Inventories 3,883 3,435
Prepaid rent 3,165 185
Prepaid and refundable income taxes 636 5,670
Prepaid expenses and other current assets 2,286 1,328
Total current assets 42,618 41,093
Property, fixtures and equipment, net 74,147 95,154
Trademarks and other intangible assets, net 2,099 2,998
Restricted cash 1,190 2,659
Deferred income taxes 353 354
Other long-term assets 2,981 3,462
Total assets $ 123,388 $ 145,720
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 5,486 $ 8,089
Accrued compensation and benefits 7,702 7,667
Workers' compensation and health insurance reserves 1,181 1,922
Accrued jambacard liability 23,846 30,764
Current portion of capital lease obligations 258 246
Other accrued expenses 10,523 12,074
Derivative liabilities - 2,098
Total current liabilities 48,996 62,860
Note payable - 22,829
Long-term capital lease obligations 49 281
Long-term workers' compensation and health insurance 1,267 2,659
reserves
Deferred rent and other long-term liabilities 15,295 16,670
Total liabilities 65,607 105,299
Commitments and contingencies
Series B redeemable preferred stock, $.001 par
value, 304,348
shares authorized and outstanding at October 6,
2009. No
shares authorized and outstanding at December 30, 30,952 -
2008
Stockholders' equity:
Common stock, $0.001 par value, 150,000,000 shares 53 55
authorized,
52,690,728 shares issued and outstanding at October
6, 2009 and
December 30, 2008, respectively
Additional paid-in-capital 358,108 358,258
Accumulated deficit (331,332 ) (317,892 )
Total stockholders' equity 26,829 40,421
Total liabilities and stockholders' equity $ 123,388 $ 145,720
JAMBA, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
12 Week Period Ended 40 Week Period Ended
(In thousands,
except share October 6, October 7, October 6, October 7, 2008
and per share 2009 2008 2009
amounts)
Revenue:
Company stores $ 77,493 $ 84,427 $ 246,174 $ 279,371
Franchise and 1,498 1,652 4,781 5,360
other revenue
Total revenue 78,991 86,079 250,955 284,731
Costs and
operating
expenses:
Cost of sales 19,282 22,746 59,798 74,459
Labor 23,612 28,124 80,925 97,542
Occupancy 10,178 10,679 34,072 34,614
Store 10,032 10,721 29,681 35,305
operating
Depreciation
and 3,943 5,835 14,397 19,331
amortization
General and 8,839 12,082 28,747 37,228
administrative
Impairment of
long-lived 532 5,901 11,107 13,198
assets
Trademark - - - 82,600
impairment
Other 3 1,427 312 6,312
operating
Total costs
and operating 76,421 97,515 259,039 400,589
expenses
Income (loss) 2,570 (11,436 ) (8,084 ) (115,858 )
from operations
Other income
(expense):
Gain (loss)
from - (520 ) 1,597 7,610
derivative
liabilities
Interest 21 69 384 315
income
Interest (320 ) (485 ) (6,920 ) (703 )
expense
Total other
(expense) (299 ) (936 ) (4,939 ) 7,222
income
Income (loss)
before income 2,271 (12,372 ) (13,023 ) (108,636 )
taxes
Income tax 495 9 462 647
benefit
Net income 2,766 (12,363 ) (12,561 ) (107,989 )
(loss)
Preferred stock (653 ) - (879 ) -
dividends
Net income
available (loss
attributable) $ 2,113 $ (12,363 ) $ (13,440 ) $ (107,989 )
to common
stockholders
Weighted-average shares used in
computation of earnings (loss)
per share:
Basic 52,690,728 53,251,591 53,912,157 52,821,493
Diluted 83,775,099 53,251,591 53,912,157 52,821,493
Earnings (loss)
per share:
Basic $ 0.04 $ (0.23 ) $ (0.25 ) $ (2.04 )
Diluted $ 0.04 $ (0.23 ) $ (0.25 ) $ (2.04 )
JAMBA, INC.
Reconciliation of GAAP Net Income (Loss) to Consolidated EBITDA
(Unaudited)
(In thousands) 12 Week Period Ended 40 Week Period Ended
October 6, October 7, 2008 October 6, 2009 October 7, 2008
2009
Company stores $ 77,493 $ 84,427 $ 246,174 $ 279,371
revenue
Franchise and 1,498 1,652 4,781 5,360
other revenue
Cost of sales (19,282 ) (22,746 ) (59,798 ) (74,459 )
Labor (23,612 ) (28,124 ) (80,925 ) (97,542 )
Occupancy (10,178 ) (10,679 ) (34,072 ) (34,614 )
Store (10,032 ) (10,721 ) (29,681 ) (35,305 )
operating
General and (8,839 ) (12,082 ) (28,747 ) (37,228 )
administrative
Consolidated $ 7,048 $ 1,727 $ 17,732 $ 5,583
EBITDA
Consolidated $ 7,048 $ 1,727 $ 17,732 $ 5,583
EBITDA
Less:
Depreciation (3,943 ) (5,835 ) (14,397 ) (19,331 )
and
amortization
Less:
Impairment of (532 ) (5,901 ) (11,107 ) (13,198 )
long-lived
assets
Less: Other (3 ) (1,427 ) (312 ) (6,312 )
operating
Less:
Trademark - - - (82,600 )
impairment
Add (less):
Other income (299 ) (936 ) (4,939 ) 7,222
(expense)
Add: Income 495 9 462 647
tax benefit
Net income $ 2,766 $ (12,363 ) $ (12,561 ) $ (107,989 )
(loss)
JAMBA, INC.
Reconciliation of GAAP Net Income (Loss) to Store-level EBITDA
(Unaudited)
(In thousands) 12 Week Period Ended 40 Week Period Ended
October 6, October 7, 2008 October 6, 2009 October 7, 2008
2009
Company stores $ 77,493 $ 84,427 $ 246,174 $ 279,371
revenue
Franchise and 1,498 1,652 4,781 5,360
other revenue
Cost of sales (19,282 ) (22,746 ) (59,798 ) (74,459 )
Labor (23,612 ) (28,124 ) (80,925 ) (97,542 )
Occupancy (10,178 ) (10,679 ) (34,072 ) (34,614 )
Store (10,032 ) (10,721 ) (29,681 ) (35,305 )
operating
Store-level $ 15,887 $ 13,809 $ 46,479 $ 42,811
EBITDA
Store-level $ 15,887 $ 13,809 $ 46,479 $ 42,811
EBITDA
Less: General
and (8,839 ) (12,082 ) (28,747 ) (37,228 )
administrative
Less:
Depreciation (3,943 ) (5,835 ) (14,397 ) (19,331 )
and
amortization
Less:
Impairment of (532 ) (5,901 ) (11,107 ) (13,198 )
long-lived
assets
Less: Other (3 ) (1,427 ) (312 ) (6,312 )
operating
Less:
Trademark - - - (82,600 )
impairment
Add (less):
Other income (299 ) (936 ) (4,939 ) 7,222
(expense)
Add: Income 495 9 462 647
tax benefit
Net income $ 2,766 $ (12,363 ) $ (12,561 ) $ (107,989 )
(loss)
Source: Jamba, Inc.
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