PHOENIX — Buoyed by demand for its healthy and natural products line, earnings at Inventure Foods, Inc. increased 44% in the third quarter of fiscal 2014. Net income in the quarter ended Sept. 27 was $3,084,000, equal to 16c per share on the common stock, up from $2,148,000, or 11c per share, in the same period a year ago. Net revenues increased 33% to $72,556,000 from $54,514,000.
During the quarter, Inventure received a boost from its healthy/natural products line, which represents nearly 85% of the company’s business. Sales of healthy/natural products increased 70% in the quarter, which helped offset a $3.5 million reduction in the company’s co-pack business.
The $3.5 million reduction in the co-pack business combined with the company’s decision to discontinue approximately $1.5 million in lower margin sales weighed on net revenues in the company’s snack segment. Net revenues in the segment fell a little more than 2% during the third quarter, to $26.4 million. Excluding the two factors, net revenues in the segment increased 21%. Gross profit in the snack segment increased $1.2 million, or 33%, to $5.1 million during the third quarter.
“We are pleased with our ability to generate solid top-line growth across our product portfolio,” said Terry McDaniel, chief executive officer. “While snack segment sales decreased slightly versus the prior year, importantly, our gross margin increased an impressive 500 basis points to 19.2%, and we expect to continue to realize margin improvements as we maintain our focus on better positioning our business for long-term growth. Going forward, our team remains committed to our ongoing strategic initiatives to expand EBITDA growth through strong sales growth, margin enhancements and leveraging the capabilities of our acquired businesses. These strategies have already proven to have a positive impact, and over time we believe they will enable us to further streamline our business in order to deliver consistent returns to our shareholders.”
Gross profit in Inventure’s frozen segment advanced 26% to $7.8 million in the third quarter, up from $6.2 million in the same period a year ago. Net revenues increased 68% to $46.1 million, up from $27.5 million a year ago.For the nine months ended Sept. 27, net income at Inventure Foods was $7,153,000, or 37c per share, up 55% from $4,611,000, or 24c per share, in the same period a year ago. Net revenues totaled $211,917,000, up 35% from $156,728,000.