Acquisitions help boost J&J Snack Foods Q3 earnings

by Eric Schroeder
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PENNSAUKEN, N.J. — The addition of several recently acquired companies coupled with strong results from its Icee and Slush Puppie businesses more than offset rising commodity costs at J&J Snack Foods Corp. Net income in the third quarter ended June 30 totaled $12,497,000, equal to 67c per share on the common stock, up 16% from $10,786,000, or 58c per share, in the same year-ago period.

Sales in the quarter were $162,510,000, up 16% from $140,132,000 a year ago. Approximately $15,700,000 of the sales increase resulted from the acquisitions of Slush Puppie in May 2006, Hom/Ade Foods and Radar in January 2007 and Fruit-A-Freeze and Whole Fruit in April 2007. Excluding these sales, sales increased 5%.

"Although we benefited from positive results from both of our recently acquired companies, Hom/Ade Foods and Daddy Ray's, and a strong showing by our Icee and Slush Puppie business, our quarter’s results were impacted by continuing escalating costs of commodities including flour and dairy products," said Gerald B. Shreiber, president and chief executive officer.

Sales to food service customers increased $12,440,000, or 15%, in the third quarter, to $95,419,000. During the quarter, soft pretzel sales to the food service segment fell 4% to $24,989,000 because of a large unit volume decline to one customer.

Bakery product sales rose 9% during the third quarter, to $34,579,000, as the company experienced higher sales to private label customers.

Sales of products to retail supermarkets advanced $2,870,000, or 20%, during the quarter to $17,380,000. Soft pretzel sales in the sector also moved up 20% to $5,960,000, while case sale of soft pretzels rose 14% and sales of frozen juices and ices increased 21%.

Frozen beverage and related products sales increased 18% during the third quarter to $49,145,000. Excluding the impact of the Icee of Hawaii and Slush Puppie acquisitions, sales were up 7% for the quarter.

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