Jamba Juice Company (JMBA) today reiterated fiscal year 2013 guidance, including Company comparable store sales guidance range of flat to 1%(1). The Company also released strategic priorities and initiatives that will guide Jamba’s growth in 2014.
“Jamba had a successful but challenging year in 2013. We made excellent progress on several key priorities to strengthen our brand with successful juice and smoothie innovations and engaging marketing programs with strategic partners such as Disney and ISIS. We also expanded our global retail store growth, added new channel strength and continued to explore new ways to reduce cost and improve productivity. But a combination of constraints on consumer spending, adverse weather in key markets and heightened competition hurt sales.” said James D. White, chairman, president and CEO, Jamba Juice Company. “We believe the actions we took and changes we implemented to address those challenges will have a meaningful impact in accelerating our growth in 2014.”
“Our 2014 priorities provide continuity and a blueprint for focusing our resources. Important drivers of our growth initiatives will be a dramatic expansion of our exciting whole food blending and premium juice beverages, continued rapid global store growth and the leveraging of our significant JambaGo® opportunities. In addition, Jamba is pursuing an enterprise-wide cost savings initiative that will result in a 100 - 200 basis point improvement in operating margins.
“Our focus on whole food blending and freshly-squeezed premium juices takes us back to Jamba’s roots. Our innovative blended beverages are an evolution in that tradition and they are now in the forefront of the growing consumer trend to healthy living.” Mr. White concluded.
Brand Activation and Leadership
Brand Activation and Leadership
The primary focus will be on initiatives that build total brand value though multi-channel brand building and product innovation, including consumer loyalty, engaging national and local marketing programs, and national scale partnerships. The development of relevant partnerships and programs will continue to encourage healthy active lifestyles. The Company has also become a leader in leveraging technology to enhance the customer experience through loyalty programs and mobile payment apps.
Jamba kicked-off a new brand and consumer message centered around “Whole Food Nutrition,” which encompasses blending juices and whole fruits and vegetables into convenient beverages for breakfast, lunch, or snack on the go. Early results show this initiative will be key in driving Jamba’s leadership in this category.
Leverage an Innovative In-Store Experience
Jamba will continue to provide a superior customer experience that will build loyalty across the enterprise. The highlight will be the rollout of whole food blending and juicing to over 300 system wide stores in 2014. In conjunction with the rollout, Jamba will continue to develop integrated programs that deliver excellent customer service and superior product knowledge to the Jamba workforce across the system.
Expand Retail Footprint
Over the past three years, the Company has had significant accomplishments in transitioning to a franchise-oriented organization. At the close of the fiscal year, 535 of 803 domestic stores/stations were franchise-owned; 268 were company-owned and operated stores. Internationally, Jamba experienced accelerated growth, ending the year with 48 franchise stores in four global markets. In addition, the Company just announced an agreement for 80 stores over the next 10 years in the Middle East. This will bring the total number of international stores to 480 over time.
Jamba embarked on significant refresh of company stores that provide a more contemporary and fresh experience for the guest, and importantly, includes the whole food blending and juice platform, which will expand into several hundred additional company and franchise locations by year end.
New Product, Partners, Channels, and Markets
Jamba will continue to build upon new markets and channels in 2014. In 2013, Jamba also expanded its flexible format solution, JambaGO, that will facilitate rapid growth of healthy menu options into K-12 schools, retail and convenience venues. As a result, the Company partnered with Target to add JambaGo units to over 1,000 Target store locations, bringing Jamba’s installations to 1,800 by the end of the year. In 2014, Jamba also will extend the product portfolio into new channels and markets through the CPG license program that was started three years ago and includes the Jamba branded frozen smoothie kits and naturally boosted energy drink.
Design Effective and Efficient Organization
A primary focus will be relentlessly pursuing ways to reduce costs, drive productivity and increase engagement across the enterprise. At the close of 2013, the Company identified cost savings across the enterprise that will increase margin by 100-200 basis points. Jamba will continue to explore and leverage existing and new partnerships to drive greater efficiencies and effectiveness. Improving store economics, including labor, COGS, distribution, occupancy, and store operations, through disciplined cost control and outlier management, will be an ongoing focus for the Company.
Outlook for 2014
The Company expects to achieve the following results for fiscal 2014:
- Deliver positive Company-owned comparable store sales of 2%-4%
- Deliver store-level margin of 18% to 19%;
- Achieve income from operations of 2.0% to 3.0%;
- Add 1,000 JambaGO™ machine sites.
Founded in 1990, Jamba Juice Company (NASDAQ:JMBA) 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, hot coffee and teas, hot oatmeal, breakfast wraps, sandwiches and mini-wraps, California Flatbreads™, and a variety of baked goods and snacks. As of December 31, 2013, there were 851 Jamba Juice store locations globally.
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