YoCream International Announces Record Third Quarter Results With Sales Up 16% and Earnings Up 25%
PORTLAND, Ore., Sept. 9 /PRNewswire-FirstCall/ -- YoCream International, Inc. (Pink Sheets: YOCM), a manufacturer and wholesaler of frozen desserts and beverages, today reported the financial results for the third quarter ended July 31, 2010.
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Sales for the three months ended July 31, 2010 increased 15.6% to $18,445,000. Sales for the nine months increased 12.1% to $41,721,000. Net income increased 25% to $2,141,000 for the quarter and increased 6% to $4,778,000 for the nine month period.
Sales of the Company's core frozen yogurt business grew 50.2% in the third quarter following 52.1% and 30.9% in the second and first quarters, respectively.
"Our conviction remains that the notable growth of our core frozen yogurt products will continue as evidenced by performance," stated Tyler Bargas, YoCream Director of Sales. "We ardently pursue business with independent shops, regional chains and other foodservice establishments through education and solution-based consulting."
Matt Hanna, YoCream Senior Director, commented that, while the Company is enjoying greater earnings from increased sales, gross profit margins have decreased. The margin decrease is mainly due to higher ingredient costs. "The Company is currently experiencing a softening of certain ingredient costs," stated Hanna. "Management is monitoring this decrease in costs, with the intention of delaying any price increases until absolutely necessary. We believe this to be a responsible position in recognition of the general state of the economy and the thousands of businesses we support through core product supply."
"Consumers are more interested than ever in the quality and health benefits of the foods they are consuming," stated Suzanne Gardner, YoCream Director of Marketing. "They are making better-for-you choices like real nonfat frozen yogurt with high live and active probiotic yogurt cultures. This demand is the basis for the sustainable success of the frozen yogurt establishments that are opening around the country and the world."
YoCream International, Inc. is a world leader in the frozen yogurt industry. Since 1977, YoCream has pioneered the innovation, production and marketing of frozen yogurt and fruit-based frozen desserts and beverages. The Company operates a state-of-the-art production facility in Portland, Oregon, to manufacture its "true" frozen yogurt, which contains the real yogurt that is fermented and cultured on site daily. The Company offers over 110 flavors of frozen yogurt, ice cream, frozen custard, sorbet, smoothies, frozen carbonated beverages, slushes and frozen drink mixes. In addition to the YoCream brand, the Company also provides other branded flavors such as Hershey's™ (e.g. Hershey's™ Kisses™, Reese's™, York™, Jolly Rancher™, Twizzlers™, Bubble Yum™) and Rockstar™ under exclusive licenses. YoCream's end-user customers number in the thousands and include marquee convenience stores, quality quick service restaurants, warehouse stores, prestigious eating establishments, large grocery chains, frozen yogurt shops, colleges, military and government foodservice locations, international restaurants and neighborhood stores involving over 250 specialty and full line distributors in the supply chain. YoCream is currently selling its frozen yogurt products in 17 foreign countries.
This release may contain certain forward-looking statements, which are based on management's current expectations. Factors that could cause future results to vary materially from these expectations include, but are not limited to, change in distribution abilities, level of customer acceptance of new products, change in strategic alliances and other economic, competitive, governmental, and regulatory factors affecting the Company's operations, pricing, products and service.
YOCREAM INTERNATIONAL, INC. |
||||||||
Three Months Ended |
Nine Months Ended |
|||||||
July 31, |
July 31, |
|||||||
2010 |
2009 |
2010 |
2009 |
|||||
Sales |
$ 18,444,986 |
$ 15,955,206 |
$ 41,721,058 |
$ 37,223,816 |
||||
Cost of goods sold |
10,656,598 |
8,750,096 |
23,496,517 |
20,018,074 |
||||
Gross profit |
7,788,388 |
7,205,110 |
18,224,541 |
17,205,742 |
||||
Operating costs and expenses |
||||||||
Distribution expenses |
2,205,980 |
1,541,357 |
4,869,964 |
3,492,268 |
||||
Selling, and marketing expenses |
1,214,705 |
1,018,234 |
3,010,717 |
2,620,456 |
||||
General and administrative expenses |
871,207 |
1,212,140 |
2,460,757 |
2,863,607 |
||||
Income from operations |
3,496,496 |
3,433,379 |
7,883,103 |
8,229,411 |
||||
Other income (expenses) |
||||||||
Interest income |
4,433 |
5,217 |
17,554 |
21,971 |
||||
Interest expense |
(97,641) |
(141,304) |
(304,394) |
(373,692) |
||||
Restricted stock compensation |
- |
(671,700) |
- |
(952,200) |
||||
Income before income taxes |
3,403,288 |
2,625,592 |
7,596,263 |
6,925,490 |
||||
Income tax provision |
(1,262,000) |
(918,900) |
(2,818,000) |
(2,423,900) |
||||
Net income |
$ 2,141,288 |
$ 1,706,692 |
$ 4,778,263 |
$ 4,501,590 |
||||
Earnings per common share – basic |
$0.82 |
$0.65 |
$1.83 |
$1.88 |
||||
Earnings per common share – diluted |
$0.82 |
$0.65 |
$1.83 |
$1.81 |
||||
Shares used in basic earnings per share |
2,607,898 |
2,607,898 |
2,607,898 |
2,391,842 |
||||
Shares used in diluted earnings per share |
2,607,898 |
2,607,898 |
2,607,898 |
2,479,668 |
||||
YOCREAM INTERNATIONAL, INC BALANCE SHEETS |
||||
July 31, |
October 31, |
|||
2010 |
2009 |
|||
(Unaudited) |
(Audited) |
|||
ASSETS |
||||
Current assets |
||||
Cash and cash equivalents |
$ 8,498,292 |
$ 12,118,067 |
||
Accounts receivable, net |
5,801,770 |
2,542,618 |
||
Inventories |
6,221,778 |
5,151,899 |
||
Income tax receivable |
- |
100,248 |
||
Other current assets |
608,245 |
569,775 |
||
Deferred tax assets |
243,775 |
243,775 |
||
Total current assets |
21,373,860 |
20,726,382 |
||
Fixed assets, net |
14,401,817 |
14,712,748 |
||
Intangible and other long-term assets, net |
1,283,078 |
1,196,655 |
||
Deferred tax assets |
374,200 |
309,500 |
||
$ 37,432,955 |
$ 36,945,285 |
|||
LIABILITIES AND SHAREHOLDERS' EQUITY |
||||
Current liabilities |
||||
Note payable – line of credit |
$ - |
$ - |
||
Current portion of long-term debt |
388,318 |
647,873 |
||
Accounts payable |
4,675,301 |
3,440,694 |
||
Income tax payable |
468,278 |
- |
||
Other accrued liabilities |
535,430 |
761,085 |
||
Total current liabilities |
6,067,327 |
4,849,652 |
||
Long-term debt, less current portion |
7,292,091 |
7,378,449 |
||
Deferred tax liabilities |
2,144,975 |
2,144,975 |
||
Other liabilities |
- |
145,250 |
||
Total liabilities |
15,504,393 |
14,518,326 |
||
Shareholders' equity |
||||
Preferred stock, no par value, none issued or outstanding |
- |
- |
||
Common stock, no par value, 30,000,000 shares authorized, 2,607,898 issued and outstanding as of July 2010 and October 2009 |
7,750,865 |
7,750,865 |
||
Retained earnings |
14,778,097 |
15,172,494 |
||
Accumulated other comprehensive income |
(600,400) |
(496,400) |
||
Total shareholders' equity |
21,928,562 |
22,426,959 |
||
$ 37,432,955 |
$ 36,945,285 |
|||
YOCREAM INTERNATIONAL, INC. STATEMENTS OF CASH FLOWS For the nine months ended July 31, 2010 and 2009 |
||||
2010 |
2009 |
|||
Cash flows from operating activities |
||||
Net income |
$ 4,778,263 |
$ 4,501,590 |
||
Adjustments to reconcile net income to net cash provided by operating activities |
||||
Depreciation and amortization |
825,604 |
763,623 |
||
Deferred income taxes |
- |
170,400 |
||
Change in assets and liabilities |
||||
Accounts receivable |
(3,259,152) |
(1,343,486) |
||
Inventories |
(1,069,879) |
(1,967,856) |
||
Other assets |
(124,893) |
(160,045) |
||
Accounts payable |
1,415,281 |
(412,515) |
||
Income taxes payable |
568,526 |
(973,361) |
||
Restricted stock compensation |
- |
952,200 |
||
Other accrued liabilities |
(370,905) |
368,080 |
||
Net cash provided by operating activities |
2,762,845 |
1,934,630 |
||
Cash flows from investing activities |
||||
Proceeds from sale and leaseback of equipment |
- |
438,753 |
||
Expenditures for fixed assets |
(695,347) |
(2,868,322) |
||
Net cash used in investing activities |
(695,347) |
(2,429,569) |
||
Cash flows from financing activities |
||||
Principal payments on long-term debt |
(514,613) |
(487,113) |
||
Excess tax benefits of restricted stock |
- |
744,130 |
||
Cash dividend payment |
(5,172,660) |
- |
||
Net cash provided by (used) in financing activities |
(5,687,273) |
257,187 |
||
Net decrease in cash and cash equivalents |
(3,619,775) |
(237,752) |
||
Cash and cash equivalents, beginning of period |
12,118,067 |
7,169,393 |
||
Cash and cash equivalents, end of period |
$ 8,498,292 |
$ 6,931,641 |
||
SOURCE YoCream International, Inc.
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