OREANDA-NEWS. Jamba, Inc. (NASDAQ:JMBA) today reported unaudited financial results for the first quarter ended March 29, 2016.

Financial Highlights

  • System-wide comparable store sales(1) decreased 2.1% for the quarter. Company-owned comparable store sales(1) increased 0.2% for the quarter. Franchise-operated comparable store sales(1) decreased 2.4% for the quarter.
  • Total revenue for the quarter decreased 64.3% to $18.8 million from $52.5 million for the prior year, primarily due to the reduction in the number of Company stores as part of the Company’s refranchising initiative.
  • Total Company-owned stores at the end of the first quarter of 2016 was 68, compared to 259 at the end of the first quarter of 2015.
  • GAAP net loss attributable to Jamba, Inc. was $(2.8) million for the first quarter or $(0.19) loss per share compared to $(1.8) million, or $(0.11) loss per share for the prior year. Non-GAAP Adjusted Net Loss attributable to Jamba, Inc.(2), was $(1.2) million for the first quarter, or $(0.08) loss per share compared to $(1.9) million, or $(0.11) loss per share for the prior year period.
  • General and administrative expenses for the quarter decreased 15.1% to $7.6 million compared with $9.0 million for the prior year period. Non-GAAP Adjusted General and Administrative Expense(2) for the quarter was $6.0 million compared with $8.5 million for the prior year period.
  • Adjusted EBITDA(3) was $1.3 million for the first quarter of 2016 and $1.2 million for the first quarter of 2015.
  • Franchisees opened 16 new Jamba Juice stores globally during the quarter. At March 29, 2016, Jamba’s global store base consisted of 68 Company Stores and 817 Franchise Stores, of which 752 are located domestically and 65 stores are located internationally.

“One of the primary levers for driving profitability and increasing brand awareness is new store development. The year started off strong with 16 new Jamba locations opened during the quarter, which provides a jumpstart to meeting our development commitments for the year,” said David A. Pace, Chief Executive Officer of Jamba, Inc.

“Over the last few weeks I’ve visited our stores, met with franchisees, employees and customers and could not be more excited about what lies ahead for the Company,” said David A. Pace, Chief Executive Officer of the Company. “Going forward we will be focused on five core strategies. First, we will position Jamba as a youthful and contemporary brand that simplifies and inspires healthy living. Second, we will re-focus the organization on a customer and store-centric operating philosophy. Third, we will drive sales and transactions through innovation and product news. Fourth, we will work with our franchise partners to improve store level profitability through operations simplification and cost reduction and finally we will expand our store footprint across all platforms both domestically and internationally.”

“We also announced today that we plan to move our headquarters to Frisco, Texas within the next six to eight months. We believe this move will better position us as we focus on these core strategies. Specifically, the move will allow us to reduce costs, attract and retain talent and provides a more central location for our market expansion plans.

First Quarter Fiscal 2016 Results

Revenue

The Company ended the first quarter of 2016 with a total of 68 company locations and 817 franchise locations, as a result of the completion of the Company’s shift to an asset light franchise business model through a refranchising initiative during 2015 that included the sale of 179 company locations. The comparisons to the prior year will be skewed due to the significant number of company locations that were sold during 2015.

For the Company’s fiscal quarter ended March 29, 2016, total revenue decreased 64.3% to $18.8 million from $52.5 million for the fiscal quarter ended March 31, 2015. The decrease is primarily due to the reduction in the number of Company-owned stores pursuant to the Company’s refranchising strategy along with the decrease in System-wide comparable store sales(1) of 2.1%. This was partially offset by an increase in Company-owned comparable store sales(1) of 0.2% which was primarily due to an increase in average check of approximately 470 basis points and a decrease in transaction count of approximately 450 basis points.

Franchise and other revenue increased 42.4% to $6.8 million for the quarter from $4.8 million in the prior year period, primarily due to the increase in royalties associated with the net increase in the number of franchise stores both domestically and internationally partially offset by the decrease of Franchise-operated comparable store sales(1) of 2.4%. Other revenue, which includes JambaGO® and CPG, was $1.3 million and $1.1 million in the first quarter of 2016 and first quarter of 2015, respectively. The increase in revenue was primarily from the Company’s cold-pressed RTD juice business.

Loss from Operations

Loss from Operations was $(2.7) million for the first quarter of 2016 compared to a loss from operations of $(1.7) million for the first quarter of 2015. Non-GAAP Adjusted Loss from Operations(2) which excludes gains and costs associated with refranchising and severance related to the shift to the asset-light business model was approximately $(1.1) million, compared to $(1.8) million in the prior year.

Retail Growth

As of March 29, 2016, there were 885 Jamba® stores System-wide, of which 817 are Franchise-operated stores and 68 are Company-owned. Franchise-operated stores include 43 express formats. During the quarter, Jamba opened 13 new domestic Franchise-operated stores and three international stores. No new Company-owned stores opened during the quarter. There were approximately 2,000 JambaGO® units in operation nationwide.

Liquidity

As of March 29, 2016, the Company held $12.5 million in cash and cash equivalents as compared to $19.7 million cash and cash equivalents at December 29, 2015. As of March 29, 2016 and March 31, 2015, the Company did not have any restricted cash.

2016 Outlook

The Company expects to achieve the following results:

  • Total revenues of $80-$82 million
  • Annual system-wide comparable sales growth of 1-3%
  • 100 new store openings, 75% Domestic/25% International
  • We will begin operations in 2 new international markets – Thailand and Indonesia
  • Non-GAAP Adjusted G&A(2) of $24.3 million, exiting 2016 with a run rate of no more than $21.7; and,
  • Non-GAAP Adjusted EBITDA(3) of $12.0-$13.0 million

About Jamba, Inc.

Jamba, Inc., owns and franchises Jamba Juice® stores through its wholly-owned subsidiary, Jamba Juice Company. Jamba Juice Company is a leading restaurant retailer of better-for-you, specialty beverage and food offerings, which include great tasting, whole fruit smoothies, fresh-squeezed juices and juice blends, and a variety of food items including, hot oatmeal, breakfast wraps, sandwiches, Artisan Flatbreads™, Energy Bowls™, baked goods and snacks. As of March 29, 2016, there were 885 store locations globally. There were 68 Company-owned and operated stores and 752 Franchise-operated stores in the United States, and 65 Franchise-operated international stores. Jamba Juice Company expanded the Jamba® brand by direct selling of consumer packaged goods (“CPG”) and licensing its trademarks. CPG products for at-home enjoyment are also available online, through select retailers across the nation and in Jamba® outlets in the United States.

     
JAMBA, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(in thousands, except share and per share amounts)
         
    13-Week Period Ended
    March 29, 2016   March 31, 2015
Revenue:        
Company stores   $ 11,953     $ 47,728  
Franchise and other revenue     6,801       4,776  
         
Total revenue     18,754       52,504  
         
Costs and operating expenses:        
Cost of sales     2,962       12,407  
Labor     4,158       16,088  
Occupancy     2,036       6,835  
Store operating     2,362       8,034  
Depreciation and amortization     1,502       1,873  
General and administrative     7,610       8,963  
Loss (gain) on disposal of assets     109       (778 )
Store pre-opening     324       22  
Store lease termination and closure     120       22  
Other operating, net     271       706  
         
Total costs and operating expenses     21,454       54,172  
         
Loss from operations     (2,700 )     (1,668 )
         
Other income (expense), net:        
Interest income     71       15  
Interest expense     (59 )     (41 )
         
Total other income (expense), net     12       (26 )
         
Loss before income taxes     (2,688 )     (1,694 )
Income tax expense     (132 )     (26 )
         
Net loss     (2,820 )     (1,720 )
Less: Net income attributable to noncontrolling interest     -       31  
         
Net loss attributable to Jamba, Inc.   $ (2,820 )   $ (1,751 )
         
Weighted-average shares used in computation of earnings per share attributable to Jamba, Inc.:        
Basic     15,084,037       16,370,885  
Diluted     15,084,037       16,370,885  
         
Net loss per share attributable to common stockholders attributable to Jamba, Inc.:        
Basic   $ (0.19 )   $ (0.11 )
Diluted   $ (0.19 )   $ (0.11 )
                 
               
JAMBA, INC.  
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS  
Reconciliation of GAAP to Non-GAAP  
(Unaudited)  
Adjusted for Transitional Costs Associated with Shift to Asset-Light Business Model  
(In thousands except share and per share amounts)  
                           
    GAAP       Non-GAAP   GAAP       Non-GAAP  
    Reported       As Adjusted   Reported       As Adjusted  
    13 Week   Gains and   13 Week   13 Week   Gains and   13 Week  
    Period Ended   Transitional   Period Ended   Period Ended   Transitional   Period Ended  
    March 29, 2016   Costs   March 29, 2016   March 31, 2015   Costs   March 31, 2015  
                           
Revenue:                          
Company stores   $ 11,953     $ -     $ 11,953     $ 47,728     $ -     $ 47,728    
Franchise and other revenue     6,801       -       6,801       4,776       -       4,776    
                           
Total revenue     18,754       -       18,754       52,504       -       52,504    
                           
Costs and operating expenses:                          
Cost of sales     2,962       -       2,962       12,407       -       12,407    
Labor     4,158       -       4,158       16,088       -       16,088    
Occupancy     2,036       -       2,036       6,835       -       6,835    
Store operating     2,362       -       2,362       8,034       (189 )     7,845    
Depreciation and amortization     1,502       -       1,502       1,873       -       1,873    
General and administrative     7,610       (1,650 )     5,960       8,963       (440 )     8,523    
Loss (gain) on disposal of assets     109       -       109       (778 )     856       78    
Store pre-opening     324       -       324       22       -       22    
Store lease termination and closure     120       -       120       22       -       22    
Other operating, net     271       -       271       706       (120 )     586    
                           
Total costs and operating expenses     21,454       (1,650 )     19,804       54,172       107       54,279    
                           
Loss from operations     (2,700 )     1,650       (1,050 )     (1,668 )     (107 )     (1,775 )  
                           
Other income (expense), net:                          
Interest income     71       -       71       15       -       15    
Interest expense     (59 )     -       (59 )     (41 )     -       (41 )  
                           
Total other income (expense), net     12       -       12       (26 )     -       (26 )  
                           
Loss before income taxes     (2,688 )     1,650       (1,038 )     (1,694 )     (107 )     (1,801 )  
Income tax expense     (132 )     -       (132 )     (26 )     -       (26 )  
                           
Net loss     (2,820 )     1,650       (1,170 )     (1,720 )     (107 )     (1,827 )  
Less: Net income attributable to noncontrolling interest     -       -       -       31       -       31    
                           
Net loss attributable to Jamba, Inc.   $ (2,820 )   $ 1,650     $ (1,170 )   $ (1,751 )   $ (107 )   $ (1,858 )  
                           
Weighted-average shares used in computation of earnings per share attributable to Jamba, Inc.:                          
Basic     15,084,037           15,084,037       16,370,885           16,370,885    
Diluted     15,084,037           15,084,037       16,370,885           16,370,885    
                           
Net loss per share attributable to common stockholders attributable to Jamba, Inc.:                          
Basic   $ (0.19 )       $ (0.08 )   $ (0.11 )       $ (0.11 )  
Diluted   $ (0.19 )       $ (0.08 )   $ (0.11 )       $ (0.11 )  
                                           
   
JAMBA, INC.  
(Unaudited)  
                   
STORE COUNT                  
    NUMBER OF STORES  
    COMPANY   FRANCHISE   TOTAL  
        Domestic   International      
For the 13-Week Period Ended March 29, 2016                  
At December 29, 2015   70   748   75   893  
Opened   -   13   3   16  
Acquired   -   -   -   -  
Closed   (2)   (9)   (13)   (24)  
Refranchised   -   -   -   -  
At March 29, 2016   68   752   65   885  
                   
                   
For the 13-Week Period Ended March 31, 2015                  
At December 30, 2014   263   543   62   868  
Opened   -   4   3   7  
Acquired   -   4   -   4  
Closed   -   (5)   (6)   (11)  
Refranchised   (4)   -   -   (4)  
At March 31, 2015   259   546   59   864  
                   
                   
                   
                   
COMPARABLE STORE SALES                  
                   
    13 Week Period Ended          
Increase/(Decrease)   March 29, 2016   March 31, 2015          
                   
Percentage Change in Comparable store sales                  
Company stores   0.2%   6.0%          
Franchise stores   (2.4)%   4.2%          
System-wide   (2.1)%   5.0%          
                   
                   
Percentage Change in Comparable Company store sales                  
Traffic effect   (4.5)%   0.2%          
Average check effect   4.7%   5.8%          
Total Comparable Company store sales   0.2%   6.0%          
                   
         

JAMBA, INC.

(Unaudited)
REVENUE    
    13 Week Period Ended
    March 29, 2016   March 31, 2015
Revenue (in thousands):        
Company stores   $ 11,953     $ 47,728  
Franchise revenue     5,495       3,675  
Other revenue     1,306       1,101  
Total revenue   $ 18,754     $ 52,504  
         
         
         

JAMBA, INC.

(Unaudited)
         
RECONCILIATION OF NET INCOME TO ADJUSTED EBITDA        
         
    13 Week Period Ended   13 Week Period Ended
    March 29, 2016   March 31, 2015
         
Net loss attributable to Jamba, Inc. (in thousands)   $ (2,820 )   $ (1,751 )
Adjustments related to gains and transitional costs     1,650       (107 )
Depreciation and amortization     1,502       1,873  
Interest income     (71 )     (15 )
Interest expense     59       41  
Income taxes     132       26  
Stock based compensation     831       1,146  
Adjusted EBITDA   $ 1,283     $ 1,213  
                 
   
JAMBA, INC.  
CONDENSED CONSOLIDATED BALANCE SHEETS  
(Unaudited)  
(In thousands, except share and per share amounts)  
           
           
    March 29,   December 29,  
    2016   2015  
(Dollars in thousands, except share and per share amounts)          
ASSETS          
Current Assets:          
Cash and cash equivalents   $ 12,536     $ 19,730    
Receivables, net of allowances of $618 and $618     16,068       16,932    
Inventories     770       818    
Prepaid expenses and other current assets     5,158       6,533    
           
Total current assets     34,532       44,013    
Property, fixtures and equipment, net     18,221       18,744    
Goodwill     1,184       1,184    
Trademarks and other intangible assets, net     1,424       1,464    
Other long-term assets     4,121       4,211    
           
Total assets   $ 59,482     $ 69,616    
           
LIABILITIES AND STOCKHOLDERS’ EQUITY          
Current Liabilities:          
Accounts payable   $ 1,922     $ 3,815    
Accrued compensation and benefits     2,533       3,788    
Workers’ compensation and health insurance reserves     651       633    
                   
Accrued jambacard liability     26,569       29,306    
                   
Other current liabilities     16,508       18,093    
           
Total current liabilities     48,183       55,635    
Deferred rent and other long-term liabilities     8,195       8,990    
           
Total liabilities     56,378       64,625    
           
Commitments and contingencies (Note 9)          
           
Stockholders’ equity:          

Common stock, $0.001 par value—30,000,000 shares authorized; 17,948,545 and 15,089,728 shares issued and outstanding at March 29, 2016, respectively, and 17,938,820 and shares issued and 15,080,003 outstanding at December 29, 2015, respectively,

     18       18    
Additional paid-in capital     404,538       403,605    
Treasury shares, at cost     (40,009 )     (40,009 )  
Accumulated deficit     (361,443 )     (358,623 )  
           
Total stockholders’ equity     3,104       4,991    
           
Total liabilities and stockholders’ equity   $ 59,482     $ 69,616