Jamba, Inc. Reports Financial Results for Fourth Quarter and Fiscal Year 2008

Jamba, Inc. (NASDAQ:JMBA, NASDAQ:JMBAU, NASDAQ:JMBAW) today reported audited financial results for the fourth quarter and fiscal year ended December 30, 2008.

Company reports, for the 12 week fiscal fourth quarter of 2008 compared to the 11 week fiscal fourth quarter of 2007:

. Total revenue for 4Q08 increased 2.8% to $56.1 million from $54.6 million for 4Q07.
. Loss from operations for 4Q08 was $(39.8) million as compared to a loss of $(219.7) million in 4Q07. Loss from operations would have been $(16.3) million as compared to $(16.3) million in 4Q07, excluding the impact of goodwill and other intangible asset impairment, store impairment, lease termination and closure costs and non-cash share-based compensation of $23.5 million compared to $203.4 million in 4Q07. *
. Net loss for 4Q08 of $(41.2) million compared to a net loss for 4Q07 of $(150.0) million. Included in the net loss for 4Q08 is a non-cash, derivative liability gain of $0.3 million associated with a change in the fair value of the Company's warrants and derivatives. Included in the net loss for 4Q07 is a non-cash derivative liability gain of $20.7 million associated with a change in the fair value of the Company's warrants.
. Diluted loss per share for 4Q08 of $(0.75) compared to a diluted loss per share for 4Q07 of $(2.85).
. Company-owned comparable store sales for 4Q08 decreased 12.0%.
. No new company-owned stores were opened in fiscal fourth quarter of 2008, compared to 31 new company-owned stores in fiscal fourth quarter of 2007. The total number of stores increased to 729, including 511 company-owned stores and 218 franchised stores.

Company reports, for the 52 week fiscal year 2008 compared to the 51 week fiscal year 2007:

. Total revenue for fiscal 2008 increased 8.1% to $342.9 million from $317.2 million in fiscal 2007.
. Diluted loss per share for fiscal 2008 of $(2.80) compared to a diluted loss per share for fiscal 2007 of $(2.17).
. Company-owned comparable store sales for fiscal 2008 decreased 8.1% (1)
. 35 new company-owned stores were opened in fiscal 2008, compared to 99 new company-owned stores in fiscal 2007.

'While we are disappointed with the results for fiscal 2008, the Company's board of directors and new management team have taken significant steps to improve long-term performance. As previously announced, we are making significant progress implementing our strategic priorities. Our strategic priorities are focused on a disciplined expense reduction effort, building a customer-first and operationally focused service culture across the company, assembling a retail food capability across all day-parts, accelerating franchise and non-traditional store growth, and enhancing our licensing platform,' stated James White, president and chief executive officer, Jamba, Inc.

'In my short time as CEO, I am very pleased with the progress we are making. In January we announced the national rollout of the Steel Cut Oatmeal with Fruit menu item, which we believe is a successful first step in our plan to assemble a retail food capability across all day-parts. To help enhance our consumer products platform and other relationships to accelerate our consumer product initiatives, we hired Susan Shields in January, a well-respected consumer products industry veteran. Also, consistent with our strategic priority of franchise and non-traditional store growth, on March 10, 2009, we completed the sale of 10 company-owned stores in Arizona to a franchisee and in February we announced the opening of new Jamba Juice airport locations at Chicago O'Hare, San Diego International and George Bush Intercontinental in Houston,' continued Mr. White.

'While we expect the economic environment to remain challenging in 2009, we are confident that we have the right strategy in place to revitalize Jamba and create long-term shareholder value,' concluded Mr. White.

Outlook

The Company continues to expect negative comparable sales trends based on the current environment and has targeted 2009 expense goals as follows:

. Cost of sales at or below 26.0% of company store revenue,
. Labor costs at or below 34.0% of company store revenue,
. Other controllable expenses included in store operating, at or below 3.5% of company store revenue and
. General and administrative costs at or below 10%, before share-based compensation expense

In addition, the Company has planned minimal, if any, Company store development and up to 50 new franchise stores in 2009.

Liquidity

On December 30, 2008, the Company held $28.5 million in cash, equivalents and restricted cash and had a total outstanding debt balance of $22.8 million.

The Company is subject to a number of customary covenants under its financing agreement, including limitations on additional indebtedness, liens, asset sales, acquisitions, dividend payments, and requirements to maintain certain financial covenants. The two financial covenants the Company is required to maintain are to retain $3 million of cash in the bank and a trailing 13 period of Store-level EBITDA of $35 million. As of December 30, 2008, the Company was in compliance with all debt covenants and expects to remain in compliance through fiscal year 2009.

. Store-level EBITDA* decreased to $44.9 million for fiscal 2008 compared to $52.9 million for fiscal 2007 and Store-level EBITDA* was zero in 4Q08 compared to $0.9 million in 4Q07. For a reconciliation of Store-level EBITDA*, a non-GAAP financial measure, to net income (loss), a GAAP financial measure please see the table at the end of this release.


Logos, product and company names mentioned are the property of their respective owners.

Reader Comments:

Be the first to leave a comment for this article

Tweet