Net income at J&J Snack Foods in the second quarter ended March 31 totaled $17,833,000, equal to 95c per share on the common stock, up 12% from $15,987,000, or 85c per share, in the second quarter of fiscal 2017. Net sales increased 8% to $266,101,000 from $246,513,000.
Overall, total food service operating income at J&J Snack Foods decreased 6% in the second quarter to $18,535,000 from $19,636,000 in the same period a year ago. Within the food service division, sales of bakery products totaled $90,813,000, up 8% from the same period a year ago, while soft pretzel sales increased 13% to $48,748,000, and churros increased 4% to $15,272,000.
“Sales of our food service products improved this quarter with significant increased sales of soft pretzels in restaurants and movie theaters, funnel cakes in schools and handhelds to a handful of customers,” Gerald B. Shreiber, chairman, president and chief executive officer, said during a May 1 conference call with analysts. “Bakery sales without Hill & Valley were improved this quarter as sales to private label business increased. Sales of our new Brahaus Pretzel have been very encouraging. Handheld sales were up strong 15% for the quarter as we have had increases to a handful of customers — existing and new. Churro sales were up 4% even though sales of … limited time offer churros were down $1.1 million. This was to a couple of customers.”
In general, Mr. Shreiber said food service has been “a star” for J&J Snack.
“We went from almost $0 to $50 million in that (fast-food restaurant and casual dining) segment, and then we backed off about $10 million as they went through their new product showing … but it’s growing again,” he said. “Our school business continues to be healthy. We went through a period of maybe two years where because of challenges with nutrition that we declined there for a little bit, but we’re back on track. Our c-store business is growing nicely. And we’ve added mid-single digits to low-double digits across all of our food service product, and we think that’s a good sign.”
In the retail supermarket segment, operating income totaled $2,534,000, up 3% from $2,454,000 a year ago. Within the retail supermarket division, sales of soft pretzels increased 10% to $10,081,000, frozen juices and ices increased 17% to $15,438,000, and handhelds fell 18% to $2,763,000.
Mr. Shreiber said the increase in the retail supermarket segment came against “a tough environment.”