J & J Snack Foods Reports Fiscal 2025 Third Quarter Results

MOUNT LAUREL, N.J., Aug. 05, 2025 (GLOBE NEWSWIRE) -- J & J Snack Foods Corp. (NASDAQ: JJSF) (the “Company”) today reported financial results for the third quarter ended June 28, 2025. Third Quarter Actuals$ vs. LY% vs. LYNet Sales$454.3M$14.3M3%Gross Profit $150.0M$2.3M2%Operating Income$60.6M$10.5M21%Net Earnings$44.2M$7.9M22%Earnings per Diluted Share $2.26$0.3921% Adjusted Operating Income$53.4M$0.4M1%Adjusted EBITDA$72.0M$1.2M2%Adjusted Earnings per Diluted Share$2.00$0.021% This press release contains non-GAAP financial measures. Please refer to the Non-GAAP Financial Measures section below for reconciliations to the most comparable GAAP measures. Dan Fachner, J&J Snack Foods Chairman, President, and CEO stated, “We delivered strong third quarter results, achieving record performance across key financial metrics, including net sales of $454.3 million and adjusted EBITDA of $72.0 million. These results reflect the resilience of our business, the strength of our diversified portfolio, the continued appeal of our brands, and our team’s relentless focus on disciplined execution in the face of a cautious consumer environment and weather-related headwinds. “Our performance was led by sales growth within our Food Service and Frozen Beverage segments, with meaningful sales growth in our core soft pretzel, bakery, and Dippin’ Dots businesses. Retail sales fell as we reduced promotional activity for frozen novelties while handheld sales declined due to capacity constraints resulting from a facility fire last year. We are implementing a solution to restore handheld capacity by the end of the calendar year. Sequential margin expansion was supported by a seasonal mix shift toward our higher-margin products, as well as recent pricing initiatives designed to offset persistent input cost inflation. “As we close out our fiscal fourth quarter, we remain cautious given the consumer backdrop, tariff-related risks, and projections for box office sales to be down in the fourth quarter. Looking ahead to fiscal 2026, we remain focused on execution and innovation, with several key product launches and customer pilots underway across pretzels, churros and frozen beverages. We are also making progress on better-for-you innovation, including high protein pretzels and clean-label novelties with functional benefits. We remain committed to driving sustainable growth and long-term value for our customers, partners and shareholders.” Third Quarter Highlights Net sales increased 3.3% from the prior year quarter to $454.3 million due primarily to higher Food Service and Frozen Beverage sales. Key highlights include: Food Service segment sales increased 4.8%Retail Supermarket segment sales decreased 7.1%Frozen Beverage segment sales increased 6.1% Gross profit increased from $147.8 million in the prior year quarter to $150.0 million, while gross margin declined from 33.6% to 33.0%. The slight decline in gross margin is mostly attributable to lower gross margin in the Frozen Beverage segment due to a higher proportion of lower margin machine sales in the quarter. Ingredient costs increased in the aggregate as compared to the prior year quarter, with the largest increases related to chocolates; however, price increases helped to offset these impacts in the quarter. Total operating expenses of $89.4 million, which included a $10.6 million gain on insurance proceeds received for damage to property, plant and equipment, and a $1.5 million intangible asset impairment charge, represented 19.7% of sales for the quarter, compared to 22.2% in the prior year quarter. Excluding these non-recurring items, operating expenses would have increased less than 1% in the quarter. Marketing and selling expenses were $33.8 million or 7.5% of sales, up slightly from 7.4% in the prior year quarter, and increased 3.8%. The increase was primarily related to expenses for summer promotions in our Frozen Beverages and Dippin’ Dots businesses.Distribution expenses were $44.7 million or 9.8% of sales, down from 10.2% in the prior year quarter. Distribution cost improvements were driven by our exit from third-party logistics facilities, lower outbound freight costs from freight optimization initiatives, and lower fuel expenses.Administrative expenses were $20.0 million or 4.4% of sales, down slightly from 4.5% in the prior year quarter. Administrative expenses were materially flat to the prior year quarter, reflecting expense control discipline. Operating income was $60.6 million, compared to $50.1 million in the prior year quarter, while adjusted operating income was $53.4 million, compared to $53.1 million in the prior year quarter. Earnings per diluted share were $2.26, compared to $1.87 in the prior year quarter, while adjusted earnings per diluted share were $2.00, compared to $1.98 in the prior year quarter. The effective tax rate was 27.2%, compared to 27.9% in the prior year quarter. Food Service Segment Third Quarter Highlights Food Service sales increased 4.8% to $277.2 million. Pretzel sales increased 12.8%, with a significant portion of the growth attributable to our Bavarian varieties. Churro sales declined 13.2%, reflecting the wind-down of a limited time offer program in the prior year.Sales of new products and added placement with new customers were approximately $8.4 million in the quarter, driven primarily by the addition of frozen novelties and churro related products, as well as new distribution of cookies.Operating income increased by $11.3 million, or 55.7% to $31.5 million, which included the net $9.1 benefit of the non-recurring insurance gain on proceeds received for property, plant and equipment, and the intangible asset impairment charge. Retail Supermarket Segment Third Quarter Highlights Retail sales decreased 7.1% to $63.9 millionFrozen novelties sales decreased 8.5% and were impacted by lower promotional activity in the quarter. Although frozen novelty sales declined in total, Dogsters and Dippin’ Dots Sundaes continued to deliver sales growth in the quarter. Retail handheld sales declined 21% as continued capacity constraints from the fire at our North Carolina facility last year limited sales. Soft pretzel sales increased 3.3%.Sales of new products and added placement with new customers were approximately $3.3 million in the quarter driven by the recent launch of our Dippin’ Dots Sundaes as well as additional distribution of pretzel dogs.Operating income decreased 26.3% to $5.8 million. Frozen Beverages Segment Third Quarter Highlights Frozen beverage segment sales increased 6.1% to $113.3 million.Beverage sales declined 1.5% which included the impact of unfavorable foreign exchange rates.Machine Service revenues increased 2.7% on higher call volumes, while machine sales increased 73.4%, primarily due to a major convenience customer upgrading its equipment across its store network.Operating income increased 5.8% to $23.3 million driven primarily by the increase in equipment sales as well as focused expense management. Conference CallJ&J Snack Foods Corp. will host a conference call to discuss results and business outlook on August 5, 2025, at 10:00 a.m. Eastern Time. Conference call participants should register by clicking on this Registration Link to receive the dial-in number and a personal PIN, which are required to access the conference call. A live audio webcast of the conference call will also be available on the Investors homepage at investors.jjsnack.com. About J & J Snack Foods Corp. J & J Snack Foods Corp. (NASDAQ: JJSF) is a leader and innovator in the snack food industry, providing innovative, niche, and affordable branded snack foods and beverages to foodservice and retail supermarket outlets. Manufactured and distributed nationwide, our principal products include SUPERPRETZEL, the #1 soft pretzel brand in the world, as well as internationally known ICEE and SLUSH PUPPIE frozen beverages, DIPPIN’ DOTS ice cream, LUIGI’S Real Italian Ice, MINUTE MAID* frozen ices, WHOLE FRUIT sorbet and frozen fruit bars, HOLA! CHURROS, and THE FUNNEL CAKE FACTORY funnel cakes and several bakery brands within DADDY RAY’S, COUNTRY HOME BAKERS and HILL & VALLEY. For more information, please visit http://www.jjsnack.com. *MINUTE MAID is a registered trademark of The Coca-Cola Company. Cautionary Statement Regarding Forward-Looking Information This press release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements regarding the Company’s expected future financial position, results of operations, revenue growth and profit levels, cash flows, business strategy, budgets, projected costs, capital expenditures, products, competitive positions, growth opportunities, plans and objectives of management for future operations, as well as statements that include words such as “anticipate,” “if,” “believe,” “plan,” “goals,” “estimate,” “expect,” “intend,” “may,” “could,” “should,” “will,” and other similar expressions are forward-looking statements. This includes, without limitation, our statements, and expectations regarding any current or future recovery in our industry and the future impact of our operational efficiency projects. Such forward-looking statements are inherently uncertain, and readers must recognize that actual results may differ materially from the expectations of management. We do not undertake a duty to update such forward-looking statements. Factors that may cause actual results to differ materially from those in the forward-looking statements include consumer spending, price competition, acceptance of new products, the pricing and availability of raw materials, transportation costs, changes in the competitive marketplace the uncertainty and ultimate economic impact of the COVID-19 pandemic or similar health outbreaks, and other risks identified in our annual report on Form 10-K, and our other filings with the Securities and Exchange Commission. Many of these factors are outside of the Company’s control. Non-GAAP Financial Measures Adjusted EBITDA consists of net earnings adjusted to exclude: income taxes (benefit); investment income; interest expense; depreciation and amortization; share-based compensation expense; net (gain) loss on sale or disposal of assets; impairment charges, restructuring costs, merger and acquisition costs, acquisition related inventory adjustments, strategic business transformation costs, integration costs, non-recurring legal fee settlements and gain on insurance proceeds received for damage to property, plant and equipment. Adjusted Operating Income consists of operating income adjusted to exclude: impairment charges, restructuring costs, merger and acquisition costs, acquisition related amortization expenses and inventory adjustments, strategic business transformation costs, integration costs, non-recurring legal fee settlements, and gain on insurance proceeds received for damage to property, plant and equipment. Adjusted Earnings per Diluted Share consists of net earnings adjusted to exclude: impairment charges, restructuring costs, merger and acquisition costs, acquisition related amortization expenses and inventory adjustment, strategic business transformation costs, integration costs, non-recurring legal fee settlements, and gain on insurance proceeds received for damage to property, plant and equipment. For purposes of comparability, the income tax effect of pre-tax adjustments is determined using statutory tax rates. This press release contains certain non-GAAP financial measures; Adjusted EBITDA, Adjusted Operating Income, and Adjusted Earnings per Diluted Share. A "non-GAAP financial measure" is a numerical measure of a company's financial performance that excludes or includes amounts so as to be different than the most directly comparable measure calculated and presented in accordance with U.S. generally accepted accounting principles ("GAAP") in the statements of income, balance sheets, or statements of cash flow of the company. Pursuant to applicable reporting requirements, the company has provided reconciliations below of non-GAAP financial measures to the most directly comparable GAAP measure. The non-GAAP financial measures presented within the Company's earnings release are not indicators of our financial performance under GAAP and should not be considered as an alternative to the applicable GAAP measure. These non-GAAP measures have limitations as analytical tools, and you should not consider them in isolation or as a substitute for analysis of our results as reported under GAAP. In addition, in evaluating these non-GAAP measures, you should be aware that in the future we may incur income, expenses, gains and losses, similar to the adjustments in this press release. Our presentation of these non-GAAP measures should not be construed as an inference that our future results will be unaffected by unusual or infrequent items. We compensate for these limitations by providing equal prominence to our GAAP results and using non-GAAP measures only as supplemental presentations. The non-GAAP measures presented are utilized by management to evaluate the Company's business performance and profitability by excluding certain items that may not be indicative of our recurring core business operating results. The Company believes that these measures provide additional clarity for investors by excluding specific income, expenses, gains, and losses, in an effort to show comparable business operating results for the periods presented. Similarly, Management believes these adjusted measures are useful performance measures because certain items included in the calculations may either mask or exaggerate trends in the Company’s ongoing operating performance. See the reconciliation of Non-GAAP Financial Measures below. Investor Contact: Joseph Jaffoni, Norberto Aja, or Jennifer NeumanJCIR(212) 835-8500jjsf@jcir.com J & J SNACK FOODS CORP. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF EARNINGS(Unaudited)(in thousands, except per share amounts) Three months ended Nine months ended June 28, June 29, June 28, June 29, 2025 2024 2025 2024 Net sales$454,293 $439,957 $1,172,990 $1,147,999 Cost of goods sold 304,248 292,191 833,341 797,405 Gross profit 150,045 147,766 339,649 350,594 Operating expenses Marketing 33,847 32,598 91,023 87,720 Distribution 44,685 45,074 126,128 129,626 Administrative 20,028 19,880 58,685 56,600 Intangible asset impairment charges 1,500 - 1,500 - Gain on insurance proceeds received for damage to property, plant, and equipment (10,622) - (10,622) - Other general expense 10 98 76 (1,055)Total operating expenses 89,448 97,650 266,790 272,891 Operating income 60,597 50,116 72,859 77,703 Other income (expense) Investment income 622 783 2,348 2,265 Interest expense (441) (543) (738) (1,532) Earnings before income taxes 60,778 50,356 74,469 78,436 Income tax expense 16,531 14,057 20,255 21,526 NET EARNINGS$44,247 $36,299 $54,214 $56,910 Earnings per diluted share$2.26 $1.87 $2.77 $2.93 Weighted average number of diluted shares 19,537 19,456 19,554 19,423 Earnings per basic share$2.27 $1.87 $2.78 $2.94 Weighted average number of basic shares 19,455 19,396 19,471 19,373 J & J SNACK FOODS CORP. AND SUBSIDIARIESCONSOLIDATED BALANCE SHEETS(Unaudited)(in thousands, except share amounts) June 28, September 28, 2025 2024Assets Current assets Cash and cash equivalents$77,377 $73,394 Accounts receivable, net 205,965 189,233 Inventories 194,965 173,141 Prepaid expenses and other 10,142 14,646 Total current assets 488,449 450,414 Property, plant and equipment, at cost 1,046,546 1,012,043 Less accumulated depreciation and amortization 641,563 620,858 Property, plant and equipment, net 404,983 391,185 Other assets Goodwill 185,070 185,070 Trade name intangible assets, net 106,677 109,695 Other intangible assets, net 68,184 72,561 Operating lease right-of-use assets 156,763 152,383 Other 3,803 3,793 Total other assets 520,497 523,502 Total Assets$1,413,929 $1,365,101 Liabilities and Stockholders' Equity Current Liabilities Current finance lease liabilities$557 $243 Accounts payable 104,405 89,268 Accrued insurance liability 18,132 16,933 Accrued liabilities 23,171 10,063 Current operating lease liabilities 21,129 19,063 Accrued compensation expense 22,253 23,325 Dividends payable 15,175 15,178 Total current liabilities 204,822 174,073 Long-term debt - - Noncurrent finance lease liabilities 1,525 445 Noncurrent operating lease liabilities 143,975 140,751 Deferred income taxes 87,908 87,824 Other long-term liabilities 5,774 5,038 Stockholders' Equity Preferred stock, $1 par value; authorized 10,000,000 shares; none issued - - Common stock, no par value; authorized, 50,000,000 shares; issued and outstanding 19,455,000 and 19,460,000 respectively 139,200 136,516 Accumulated other comprehensive loss (13,670) (15,299)Retained Earnings 844,395 835,753 Total stockholders' equity 969,925 956,970 Total Liabilities and Stockholders' Equity$1,413,929 $1,365,101 J & J SNACK FOODS CORP. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF CASH FLOWS(Unaudited)(in thousands) Nine months ended June 28, June 29, 2025 2024Operating activities: Net earnings$54,214 $56,910 Adjustments to reconcile net earnings to net cash provided by operating activities Depreciation of fixed assets 48,296 47,141 Amortization of intangibles and deferred costs 5,871 5,244 Intangible asset impairment charges 1,500 - (Gains) from disposals of property & equipment (394) (23)Share-based compensation 4,580 4,841 Deferred income taxes 127 310 Gain on insurance proceeds received for damage to property, plant, and equipment (10,622) - Gain on insurance proceeds received in excess of operating losses recognized (799) - Other 212 268 Changes in assets and liabilities, net of effects from purchase of companies (Increase) in accounts receivable (16,491) (10,949)(Increase) in inventories (21,634) (7,264)Net changes in other operating assets and liabilities 33,837 30,268 Net cash provided by operating activities 98,697 126,746 Investing activities: Payments for acquisitions - (7,014)Purchases of property, plant and equipment (61,264) (56,371)Proceeds from disposal of property and equipment 1,413 484 Proceeds from insurance for fixed assets 11,421 - Net cash (used in) investing activities (48,430) (62,901) Financing activities: Payments to repurchase common stock (5,000) - Proceeds from issuance of stock 3,104 9,657 Borrowings under credit facility 40,000 57,000 Repayment of borrowings under credit facility (40,000) (72,000)Payments on finance lease obligations (182) (120)Payment of cash dividend (45,575) (42,693)Net cash (used in) financing activities (47,653) (48,156) Effect of exchange rates on cash and cash equivalents 1,369 (1,223) Net increase in cash and cash equivalents 3,983 14,466 Cash and cash equivalents at beginning of period 73,394 49,581 Cash and cash equivalents at end of period$77,377 $64,047 J & J SNACK FOODS CORP. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Unaudited) (in thousands) Three months ended Nine months ended June 28, June 29, June 28, June 29, 2025 2024 2025 2024Sales to external customers: Food Service Soft pretzels$67,142 $59,529 $169,693 $163,985 Frozen novelties 52,804 51,701 104,764 100,464 Churros 26,269 30,269 76,803 89,155 Handhelds 21,281 21,300 67,348 62,851 Bakery 101,744 93,566 304,497 287,455 Other 7,930 8,081 19,001 19,135 Total Food Service$277,170 $264,446 $742,106 $723,045 Retail Supermarket Soft pretzels$11,482 $11,110 $44,565 $46,010 Frozen novelties 42,297 46,210 85,558 82,747 Biscuits 4,440 4,839 17,295 18,078 Handhelds 5,957 7,562 16,243 20,266 Coupon redemption (506) (931) (1,409) (2,032)Other 190 (67) 173 303 Total Retail Supermarket$63,860 $68,723 $162,425 $165,372 Frozen Beverages Beverages$71,040 $72,092 $157,197 $158,708 Repair and maintenance service 24,378 23,748 72,232 71,538 Machines revenue 16,940 9,769 36,603 26,879 Other 905 1,179 2,427 2,457 Total Frozen Beverages$113,263 $106,788 $268,459 $259,582 Consolidated sales$454,293 $439,957 $1,172,990 $1,147,999 Depreciation and amortization: Food Service$12,752 $12,130 36,639 $33,976 Retail Supermarket 289 396 855 1,448 Frozen Beverages 5,616 5,667 16,673 16,961 Total depreciation and amortization$18,657 $18,193 $54,167 $52,385 Operating Income: Food Service$31,515 $20,247 $34,432 $34,194 Retail Supermarket 5,755 7,812 8,919 13,374 Frozen Beverages 23,327 22,057 29,508 30,135 Total operating income$60,597 $50,116 $72,859 $77,703 Capital expenditures: Food Service$16,764 $12,717 $43,268 $33,946 Retail Supermarket 44 - 189 2 Frozen Beverages 5,926 7,028 17,807 22,423 Total capital expenditures$22,734 $19,745 $61,264 $56,371 Assets: Food Service$1,010,849 $991,815 $1,010,849 $991,815 Retail Supermarket 33,116 36,719 33,116 36,719 Frozen Beverages 369,964 352,141 369,964 352,141 Total assets$1,413,929 $1,380,675 $1,413,929 $1,380,675 J & J SNACK FOODS CORP. AND SUBSIDIARIES NON-GAAP FINANCIAL MEASURES (Unaudited) (in thousands) Three months ended Nine months ended June 28, June 29, June 28, June 29, 2025 2024 2025 2024 Reconciliation of GAAP Net Earnings to Adjusted EBITDA Net Earnings $44,247 $36,299 $54,214 $56,910 Income Taxes 16,531 14,057 20,255 21,526 Investment Income (622) (783) (2,348) (2,265)Interest Expense 441 543 738 1,532 Depreciation and Amortization 18,657 18,193 54,167 52,385 Share-Based Compensation 1,828 1,634 4,580 4,842 Strategic Business Transformation Costs (2) - 295 - 4,848 Gain on insurance proceeds received for damage to property, plant, and equipment (10,622) - (10,622) - Restructuring Costs - - 260 - Non-recurring Legal Expenses - - 591 - Net (Gain) Loss on Sale or Disposal of Assets 72 (6) 149 (23)Impairment Costs 1,500 - 1,500 - Acquisition Related Inventory Adjustment - 183 - 183 Merger and Acquisition Costs - 250 - 250 Integration Costs - 205 - 205 Adjusted EBITDA $ 72,032 $ 70,870 $ 123,484 $ 140,393 Reconciliation of GAAP Operating Income to Adjusted Operating Income Operating Income 60,597 50,116 72,859 77,703 Strategic Business Transformation Costs (2) - 295 - 4,848 Gain on insurance proceeds received for damage to property, plant, and equipment (10,622) - (10,622) - Restructuring Costs - - 260 - Non-recurring Legal Expenses - - 591 - Acquisition Related Amortization Expenses 1,946 2,012 5,871 5,244 Impairment Costs 1,500 - 1,500 - Acquisition Related Inventory Adjustment - 183 - 183 Merger and Acquisition Costs - 250 - 250 Integration Costs - 205 - 205 Adjusted Operating Income $ 53,421 $ 53,061 $ 70,459 $ 88,433 Reconciliation of GAAP Earnings per Diluted Share to Adjusted Earnings per Diluted Share Earnings per Diluted Share $2.26 $1.87 $2.77 $2.93 Strategic Business Transformation Costs (2) - 0.02 - 0.25 Gain on insurance proceeds received for damage to property, plant, and equipment (0.54) - (0.54) - Restructuring Costs - - 0.01 - Non-recurring Legal Expenses - - 0.03 - Acquisition Related Amortization Expenses 0.10 0.10 0.30 0.27 Impairment Costs 0.08 - 0.08 - Acquisition Related Inventory Adjustment - 0.01 - 0.01 Merger and Acquisition Costs - 0.01 - 0.01 Integration Costs - 0.01 - 0.01 Tax Effect of Non-GAAP Adjustments (1) 0.10 (0.04) 0.03 (0.15) Adjusted Earnings per Diluted Share $ 2.00 $ 1.98 $ 2.68 $ 3.33 (1) Income taxes associated with pre-tax adjustments determined using statutory tax rates(2) Strategic business transformation costs are start-up costs related to our regional distribution center supply chain transformation.

J & J Snack Foods Reports Fiscal 2025 Third Quarter Results

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