The Inventure Group Reports Another Record Quarter and Full Year 2009 Results
Delivered 8th consecutive quarter of year-over-year earnings growth, grew annual EPS by 62% and EBITDA by 30%
PHOENIX, Feb. 25 /PRNewswire-FirstCall/ -- The Inventure Group, Inc. (Nasdaq: SNAK), a leading specialty snack food manufacturer, today reported record financial results for the fourth quarter and full year for the period ending December 26, 2009, highlighted by an 8th consecutive quarter of year-over-year earnings growth, annual EPS growth of 62%, annual net income increase of 60%, annual EBITDA gain of 30% and an annual net revenue increase of 7%.
Q4 2009 Results Overview
Consolidated net revenue for the fourth quarter ended December 26, 2009 was $27.9 million, an increase of 0.4% vs. last year's fourth quarter.
Snack division revenue was $19.0 million, up 0.5% from prior year. Key revenue growth drivers included the on-going success of T.G.I. Friday's®, up 4.2% and strong demand for Premium Private Label products which delivered a 42.1% revenue increase. Boulder Canyon™ Natural Foods revenue for the quarter was flat, reflecting significantly increased competitive pressure and a one-time customer issue which has been resolved. Snack division revenue gains were partially offset by continued revenue declines in Poore Brothers® of 35.9% and BURGER KING™ of 4.1%.
Rader Farms net revenue was $9.0 million, an increase of 0.4% despite a double digit percentage price decline. Rader Farms product demand remained especially strong as total pounds sold increased by 29% for the quarter.
Net income for the quarter was $0.6 million or $0.03 per share versus $0.1 million or $0.01 per share last year.
Consolidated EBITDA for the quarter was $2.0 million, an increase of 43% versus last year, attributable to cost savings initiatives in the Snack division as well as a reduction in SG&A expenses. A table reconciling EBITDA to net income is presented at the end of the condensed consolidated financial statements included in this release.
Full Year 2009 Results Overview
Full year 2009 net revenue was $121.0 million, an increase of 7.0% over 2008.
Snack Division revenue was $80.6 million, up 7.9% for the year. Key revenue growth drivers included Boulder Canyon™ Natural Foods growth of 15.0%, T.G.I. Friday's® growth of 5.9%, BURGER KING™ growth of 3.8% and Premium Private Label growth of 89.7%. These increases were partially offset by a decline in the Poore Brothers® brand, down 29.7%.
Rader Farms revenue was $40.5 million, an increase of 5.3% despite the aforementioned fourth quarter price decline. Total Rader pounds, however, were up 21% for the year.
Key Financial Highlights for 2009:
- Gross profit was $23.8 million, representing 19.7% of net revenue and an increase of 7.3% and 0.1 percentage points versus 2008. An increase in both gross profit dollars and margin was achieved without the benefit of any price increases and with a double digit price reduction in the fourth quarter for Rader Farms.
- SG&A expenses were $16.7 million or 13.8% of net revenue, virtually flat in dollars but down 1.1 percentage points versus 2008.
- Operating income was $7.1 million or 5.8% of net revenue, an increase of 32% and 1.1 percentage points versus 2008.
- Net income for the year was $3.8 million or $0.21 per share, an increase of 60% and 8 cents per share versus 2008.
- Total year EBITDA was $10.6 million or 8.8% of net revenue, an increase of 30% and 1.6 percentage points vs. 2008. A table reconciling EBITDA to net income is presented at the end of the condensed consolidated financial statements included in this release.
Management Commentary & Future Outlook
"We are very excited about our second year in a row of record revenue and earnings," said Terry McDaniel, President and CEO. "In an extremely tough economy we managed to grow both the top and bottom lines. Our Rader Farms business continues to perform very well. Despite a double digit price decrease in the fourth quarter, Rader sales grew due to a significant increase in consumption as evidenced by a growth in pounds sold of 29%. We expect to see a continuation in the growth of unit sales. We are launching our new at home Jamba™ smoothie product late in the first quarter of 2010 and we are extremely pleased with the response from the trade thus far." McDaniel continued: "Looking at our snack business, Boulder Canyon™ Natural Foods was up 15% for the year despite a slowdown in Q4 sales growth. We anticipate that 2010 will be an exceptionally strong year for Boulder as we intend to increase investments in people, new products and increase consumer and trade promotion spending. T.G.I. Friday's®, an important earnings contributor, continued its successful turnaround this year by delivering a 5.9% increase in sales, the first annual increase since 2005. We were successful in expanding distribution channels, introducing new products and executing an exciting cross promotion program with T.G.I. Friday's® restaurants. BURGER KING™ was up 3.8% for the year. Looking ahead, we are introducing a series of innovative new products for the BURGER KING™ line, which will utilize our newly developed pellet technology and continue to expand internationally."
"One of our key strategic goals for 2009 was to grow our premium private label business and we were very successful as evidenced by total private label business growth of 90% vs. last year. Aside from the benefit of revenue gains, growth in our private label business also allows us to leverage our plant overhead more efficiently and enhances relationships with existing and potential new retail partners."
McDaniel concluded: "In summary, 2009 was another exciting year for The Inventure Group and we anticipate positive momentum to carry forward to 2010. In the year ahead we will be launching our new at home Jamba™ Smoothie line towards the end of Q1, continue to invest aggressively in Boulder Canyon™ Natural Foods and remain focused on our indulgent specialty line of products. Private label will remain a strategic focus of ours and we have already added new private label customers which we expect to begin shipping this summer and which could add more than $2 million in incremental annualized sales. We will also be announcing a major Bluffton facility project in the second quarter which should drive efficiencies and help leverage the existing plant infrastructure. On the heels of two years of record results, we will continue to execute according to our long term plan of investing in brands, plants and people and look to achieve even greater success."
Conference Call
The Inventure Group's executive management team will host a conference call today at 4 p.m. ET to discuss the Company's fourth quarter and full year 2009 results and comment on its future outlook. To participate in the conference call, please call toll-free (877) 280-7280 or (707) 287-9365 for international callers.
A live webcast of the call will also be available by accessing www.inventuregroup.net and will be archived for one year following the event.
About The Inventure Group, Inc.
With manufacturing facilities in Arizona, Indiana and Washington, The Inventure Group is a marketer and manufacturer of specialty brands in better-for-you and Indulgent categories under a variety of Company owned and licensed brand names, including Boulder Canyon Natural Foods™, Rader Farms®, T.G.I. Friday's®, BURGER KING™, Jamba™, Poore Brothers®, Tato Skins® and Bob's Texas Style®. For further information about The Inventure Group visit www.inventuregroup.net.
Statements contained in this press release that are not historical facts are forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. Because such statements include risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements. Factors that may cause actual results to differ from the forward-looking statements contained in this press release and that may affect the Company's prospects in general include, but are not limited to, the potential need for additional financing, acquisition-related risks, significant competition, customer acceptance of new products, dependence upon major customers, dependence upon existing and future license agreements, general risks related to the food products industry, deteriorating economic conditions, and such other factors as are described in the Company's filings with the Securities and Exchange Commission.
THE INVENTURE GROUP, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
Quarter Ended Twelve Months Ended
------------- -------------------
Dec. 26, Dec. 27, Dec. 26, Dec. 27,
2009 2008 2009 2008
--------- --------- --------- ---------
(unaudited) (unaudited) (unaudited) (unaudited)
Net revenue $27,935,533 $27,816,849 121,011,309 $113,058,715
Cost of revenue 23,280,485 23,111,156 97,189,028 90,864,406
---------- ---------- ---------- ----------
Gross profit 4,655,048 4,705,693 23,822,281 22,194,309
Selling, general &
Administrative expenses 3,597,257 4,051,628 16,746,148 16,827,692
--------- --------- ---------- ----------
Operating income 1,057,791 654,065 7,076,133 5,366,617
Interest expense, net 197,548 275,408 878,807 1,275,535
------- ------- ------- ---------
Income before income
taxes 860,243 378,657 6,197,326 4,091,082
Income tax provision 306,911 246,441 2,415,687 1,721,791
------- ------- --------- ---------
Net income $553,332 $132,216 $3,781,639 $2,369,291
-------- -------- ---------- ----------
Earnings per common share:
--------------------------
Basic $0.03 $0.01 $0.21 $0.13
----- ----- ----- -----
Diluted $0.03 $0.01 $0.21 $0.13
----- ----- ----- -----
Weighted average number
of common shares:
------------------
Basic 17,887,580 18,483,086 17,955,165 18,736,331
---------- ---------- ---------- ----------
Diluted 18,007,819 18,483,086 18,239,380 18,736,331
---------- ---------- ---------- ----------
THE INVENTURE GROUP, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
Dec. 26, Dec. 27,
2009 2008
---- ----
(unaudited) (unaudited)
Current assets $30,730,825 $26,039,814
Property and equipment, net 23,734,921 24,548,060
Other assets, net 14,969,543 14,673,168
---------- ----------
Total assets $69,435,289 $65,261,042
----------- -----------
Line of credit $9,870,590 $8,188,990
Other current liabilities 12,870,696 13,353,748
Long-term debt 10,037,902 11,251,510
Other long-term liabilities 3,749,538 3,415,488
--------- ---------
Total liabilities 36,528,726 36,209,736
Shareholders' equity 33,377,758 29,051,306
Treasury stock, at cost (471,195) --
-------- ---
Total liabilities and shareholders' equity $69,435,289 $65,261,042
----------- -----------
THE INVENTURE GROUP, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
RECONCILIATION
(unaudited)
Quarter Ended Twelve Months Ended
------------- -------------------
Dec. 26, Dec. 27, Dec. 26, Dec. 27,
2009 2008 2009 2008
-------- -------- -------- --------
Reconciliation – EBITDA (1):
Reported net income $553,332 $132,216 $3,781,639 $2,369,291
Add back: Interest, net 197,548 275,408 878,807 1,275,535
Add back: Income tax expense 306,911 246,441 2,415,687 1,721,791
Add back: Depreciation 916,816 721,780 3,450,267 2,737,626
Add back: Amortization of
intangible assets 15,610 15,610 62,442 49,025
------ ------ ------ ------
EBITDA $1,990,217 $1,391,455 $10,588,842 $8,153,268
---------- ---------- ----------- ----------
(1) EBITDA is presented as a supplemental performance measure and is not intended as an alternative to net income or any other measure calculated in accordance with generally accepted accounting principles. Further, EBITDA may not be comparable to similarly titled measures used by other companies.
SOURCE The Inventure Group, Inc.
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