PENNSAUKEN, N.j. — J&J Snack Foods Corp.’s top executive said the company remains committed to long-term profitable sales growth after the company turned in a quarter in which net sales increased but net income fell.
Net income at J&J Snack Foods Corp. in the first quarter ended Dec. 28, 2019, totaled $17,059,000, equal to 89c per share on the common stock, down 3% from $17,526,000, or 93c per share, in the same period a year ago. Fiscal 2019 results benefited from a reduction of approximately $900,000 in income tax. Earnings before income taxes totaled $23,463,000, up from $23,095,000 in the first quarter of fiscal 2019.
Net sales increased 4% to $282,897,000 from $271,612,000.
Overall, total food service operating income at J&J Snack Foods increased 2% in the first quarter to $18,034,000 from $17,697,000 in the same period a year ago. Sales, meanwhile, increased 2% to $183,448,000. Within the food service division, sales of bakery products totaled $96,372,000, up 2% from the same period a year ago, while churros sales increased 8% to $16,391,000 and soft pretzel sales rose 2% to $49,941,000.
Gerard G. Law, senior vice-president and assistant to the president, said J&J Snack has several new products ready to roll out in the food service segment, including new fries, funnel cakes and savory crackers.
“We feel good about schools rolling forward, which has been a headwind for us in the first quarter,” Mr. Law said during a Jan. 28 conference call with analysts.
In the retail supermarket segment, operating income totaled $2,217,000, up narrowly from $2,211,000 a year ago. Total sales in the retail supermarket segment were $29,426,000, down 6% from the same period a year ago. Within the retail supermarket division, sales of soft pretzels decreased 4% to $9,826,000, frozen juices and ices decreased 8% to $10,093,000, and handhelds increased 8% to $2,761,000.
“Retail, the resets are going to be great for us, we think,” Mr. Law said. “We’ve refreshed our Luigi's packaging, which we feel like we’re going to get a bump out of. We have a … more comprehensive marketing program going forward in the next couple of quarters. So we’re doing a lot around the business to get the top line to move.”
Gerald B. Shreiber, president and chief executive officer, added that Auntie Anne’s, which was acquired nearly two years ago, has been a good acquisition for J&J Snack.
“Although it was a competitor to us in the soft pretzel category and supermarkets, now it’s a complementary product to our SuperPretzel,” he said. “So we expect to benefit from that this year and beyond.”