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Jamba, Inc. Reports Results for the First, Second, and Third Quarters of Fiscal 2017, and Updates 2017 and 2018 Guidance

FRISCO, Texas--(BUSINESS WIRE)--Mar. 15, 2018-- Jamba, Inc. (NASDAQ:JMBA) (“the Company”) today announced financial results for the fiscal quarters ended April 4, 2017 (“first quarter”), July 4, 2017 (“second quarter”), and October 3, 2017 (“third quarter”), and updated its fiscal 2017 and 2018 financial guidance.

Highlights for the 39-week period ended October 3, 2017 compared to the 39-week period ended September 27, 2016:

  • Total Revenue declined $6.1 million to $56.3 million, primarily due to the Company’s transition to an asset light business model and the exit of non-core business units.
  • Domestic system-wide sales increased $7.1 million to $392.9 million.
  • Net Income (Loss) improved $5.4 million, to a loss of $1.9 million.
  • Non-GAAP Adjusted EBITDA increased 39.2% to $12.8 million.
  • Non-GAAP Adjusted EBITDA Margin increased to 22.8%, compared to 14.8%.
  • Opened 35 new stores, of which 27 were domestic and eight international.
  • Completed portfolio optimization transactions in Chicago, Phoenix, and Seattle, including development agreements for 32 new stores across the three markets.

CEO Comments

Dave Pace, President and Chief Executive Officer, noted: “Along with the filing of the 2016 10-K on February 12th, completion of the 2017 10-Qs meets an important filing deadline, and accelerates our return to a standard reporting cadence.”

Pace continued: “Financial results for the first three quarters of 2017 reflect our concrete actions to reinvigorate the Jamba business. We enhanced our organization with experienced additions to the leadership team, exited non-core and underperforming business units to improve profitability, and launched innovative new products. Together, these changes elevated the customer experience in our stores. We saw sequential improvements in comparable store sales through 2017, culminating in our previously reported 5.3% increase in the fourth quarter. The fourth quarter also marked the seventh consecutive quarter in which our comparable store sales beat the industry benchmark. Adjusted EBITDA grew 39% through the first three quarters of 2017.”

Pace concluded: “Jamba is an iconic brand. We have positioned it for sustainable growth and significant value-creation for our shareholders and are optimistic about our performance in 2018.”

 
KEY OPERATING METRICS FOR THE 39-WEEKS ENDED OCTOBER 3, 2017
 
  First quarter, ended   Second quarter, ended   Third quarter, ended   Year to date, ended
April 4,
2017
  March 29,
2016
July 4,
2017
  June 28,
2016
October 3,
2017
  September 27,
2016
October 3,
2017
  September 27,
2016
Number of system-wide stores

open at end of period

868 842 870 842 866 849 866 849
New store openings 15 13 10 11 10 16 35 40
Domestic system-wide

comparable store sales change (a)

(5.8 )% (2.1 )% (0.0 )% 4.2 % (0.2 )% (1.1 )% (1.9 )% 0.4 %
Domestic system-wide sales

(in thousands)

117,034 115,503 139,822 137,389 136,088 132,918 392,944 385,810
Blended royalty rate 5.1 % 5.2 % 5.0 % 5.1 % 4.9 % 5.1 % 5.0 % 5.1 %
Net Income (in thousands) (3,152 ) (2,820 ) 1,725 (2,479 ) (457 ) (1,964 ) (1,884 ) (7,263 )
Adjusted EBITDA (in thousands) 3,005 1,283 5,081 3,811 4,727 4,111 12,813 9,206
Adjusted EBITDA

margin percent

17.1 % 6.8 % 24.8 % 17.7 % 26.0 % 18.6 % 22.8 % 14.8 %
 
(a) Due to a 53 week fiscal 2016, 2017 year-over-year fiscal comparisons are offset by one week. Comparable calendar period is presented above. Using comparable calendar periods balances the one week shift and provides a clearer year over year comparison. 2016 fiscal and calendar comparisons are the same.
 

Liquidity

As previously disclosed, the Company held cash of $11.9 million as of October 3, 2017, $11.2 million as of July 4, 2017, $8.2 million as of April 4, 2017, and $7.1 million as of January 3, 2017.

On February 12, 2018, the Company provided additional information. As of January 2, 2018, the Company held cash of $10.0 million, including restricted cash of $0.3 million.

The Company used approximately $5.7 million of cash during fiscal 2017 to pay audit and related expenses. The Company anticipates audit and related expenses will continue into 2018 and result in additional use of cash, and financial statement expense, though at a reduced level as compared to 2017.

The Company had not drawn against its line of credit, and had no outstanding principal balance as of the end of fiscal 2017.

Reported balances are unaudited.

Fiscal 2017 Financial Guidance

The Company expects to achieve the following results for fiscal 2017:

   
Metric

Initial Guidance
Issued March 20, 2017

Current Outlook
Total Revenue $75 to $77 million Approximately $71 million
Annual system-wide comparable sales Flat, to slightly positive -0.4% (a)
New store openings 65 to 75 new store openings; 25 to 35 openings, net of closures 50 new store openings; 11 openings, net of closures (a)
Non-GAAP Adjusted G&A expense Approximately $21 million, exiting 2017 with a run rate of no more than $20 million Approximately $18 million; exiting 2017 with a run rate of no more than $20 million
Non-GAAP Adjusted EBITDA $13 million to $15 million At least $14.5 million
 

(a) Actual results as reported February 12, 2018

 

Marie Perry, Executive Vice President and Chief Financial Officer, noted: “We expect 2017 to be a year of strong profit growth. The transition to an asset-light model, along with a strategic refocusing on the core retail business, will cause revenue to decline in a predictable fashion. On this reduced revenue base, however, we expect significant improvements in profitability. Specifically, we anticipate an improvement of approximately $3.5 million in Adjusted EBITDA in fiscal 2017 as compared to fiscal 2016.”

Total Revenue guidance issued March 20, 2017 included 13 stores in the greater Chicago area as Company-owned for the full year. Subsequent to this guidance, in June 2017, these 13 stores were successfully refranchised to an existing franchisee. As a result of this transaction, 2017 Revenue declined by approximately $3.8 million relative to the March 20, 2017 guidance expectation.

Fiscal 2018 Financial Guidance

The Company expects to achieve the following results for fiscal 2018:

   
Metric

Initial Guidance
Issued February 12, 2018

Current Outlook
Total Revenue $68 million to $70 million $68 million to $70 million
Annual system-wide comparable sales Positive Positive
New store openings n.a. Approximately 50 new store openings
Non-GAAP Adjusted G&A expense n.a. Under $20 million
Non-GAAP Adjusted EBITDA $15 million to $16 million $15 million to $16 million
Adjusted EBITDA margin percent n.a. 22% to 23%
 

At a future date, the Company will provide an update to this guidance to include the necessary adjustments for the new revenue recognition standard. The Fiscal 2018 Financial Guidance currently excludes the impact of this new standard.

Non-GAAP Adjusted G&A Expense, Non-GAAP Adjusted EBITDA and Non-GAAP Adjusted EBITDA Margin Percent set forth above are forward looking Non-GAAP measures which the Company is not able to provide comparable GAAP forward-looking estimate of net income without unreasonable effort, as information needed to make a reasonable forward-looking estimate is difficult to predict and estimate and dependent on future events which are uncertain or outside the Company’s control. The probable significance of such adjustments is also similarly difficult to estimate for the same reasons.

Fiscal 2017 Form 10-K Filing

As previously disclosed, the delay in completion of the Company’s financial statements resulted from changes the Company underwent in the past several years, including:

  • transitioning to a franchise focused, asset light business model
  • significant changes in leadership and key personnel
  • relocating its corporate office from California to Texas in 2016
  • accounting for an unusually high number of non-routine transactions impacting its existing financial reporting processes
  • executing against a reduced materiality threshold resulting from the changes in its business model referenced above

The Company continues to work diligently with Jamba’s newly appointed auditor, Whitley Penn LLP to complete fiscal 2017 financial statements and their subsequent audit, and to thereafter file the 2017 Form 10-K as soon as practicable.

Anticipated Expenses

As previously disclosed, the Company expects to record additional expenses (collectively, “audit and related expenses”) resulting from efforts to complete 2016 financial statements, their subsequent audit and review, and remediation efforts related to the anticipated Material Weakness disclosed in the Company’s Form 12b-25 filed with the Securities and Exchange Commission on May 15, 2017. As a result of the ongoing nature of this work, the Company expects to record expenses in its 2017 and 2018 financial statements in addition to expenses in 2016 as reflected in its 2016 Form 10-K. Due to the unusual and non-recurring nature of these expenses, the Company anticipates adjusting for them in its Non-GAAP financial measures.

Conference Call

The Company will host a conference call Friday, March 16 at 8:30 a.m. Eastern Time. The call will be webcast live from the Company’s website at www.jambajuice.com under the Corporate Investor Relations section or directly at http://ir.jambajuice.com. The conference call can also be accessed live over the phone by dialing (877) 407-3982. A replay will be available at 11:30 a.m. Eastern Time and can be accessed by dialing (844) 512-2921; the pin number is 13677475. The replay will be available until Friday, April 6, 2018.

About Jamba, Inc.

Jamba, Inc. (Nasdaq: JMBA) through its wholly-owned subsidiary, Jamba Juice Company, is a global healthy lifestyle brand that inspires and simplifies healthful living through freshly blended whole fruit and vegetable smoothies, bowls, juices, cold-pressed shots, boosts, snacks, and meal replacements. Jamba’s blends are made with premium ingredients free of artificial flavors and preservatives so guests can feel their best and blend the most into life.

Jamba Juice® has more than 800 franchised and company-owned locations worldwide, as of January 2, 2018. For more information, visit jambajuice.com.

Forward-Looking Statements

This press release (including information incorporated or deemed incorporated by reference herein) contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are those involving future events and future results that are based on current expectations, estimates, forecasts, and projections as well as the current beliefs and assumptions of the Company’s management. Words such as “believes”, “expects”, “appears”, “may”, “will”, “should”, “anticipates”, or the negative thereof or comparable terminology, are intended to identify such forward-looking statements. Any statement that is not a historical fact, including estimates, projections, future trends and the outcome of events that have not yet occurred, is a forward-looking statement. Forward-looking statements are only predictions and are subject to risks, uncertainties and assumptions that are difficult to predict. Therefore actual results may differ materially from those expressed in any forward-looking statements. These statements include, but are not limited to, statements referenced under the caption “Fiscal 2017 Financial Guidance” and “Fiscal 2018 Financial Guidance” above, risks and uncertainties relating to the Company’s ability to file its periodic reports with the Securities and Exchange Commission and hold its annual meeting in a manner to regain and continue to maintain compliance with Nasdaq listing rules, the Company’s business strategy and financial performance, its revenue and customer volatility based upon weather and general economic conditions, the operating results of the Company’s franchisees, additional costs expected to be incurred as a result of ongoing work relating to the Company’s financial statements, including anticipated remediation efforts relating to the material weakness disclosed in the Company’s Form 10-K, the fluctuations in various food and supply costs, competition and other risks related to the food services business, the Company’s ability to retain its executive management team and key employees and other factors discussed under the section entitled “Risk Factors” in the Company’s reports filed with the SEC. Many of such factors relate to events and circumstances that are beyond the Company’s control. You should not place undue reliance on forward-looking statements. The Company does not assume any obligation to update the information contained in this press release.

Non-GAAP Financial Measures

The Company provides certain forward-looking Non-GAAP financial measures to its investors. The Company believes that providing these forward-looking Non-GAAP measures to its investors provides investors the benefit of viewing the Company's performance using the same financial metrics that the management team uses in making many key decisions and understanding how the Company's core business operations may perform and may look in the future. The Non-GAAP financial measures are discussed further below.

Non-GAAP financial measures are not in accordance with, or an alternative for, generally accepted accounting principles in the United States of America. Non-GAAP measures should not be considered in isolation from or as a substitute for financial information presented in accordance with generally accepted accounting principles, and may be different from Non-GAAP measures used by other companies.

The following definitions apply to these terms as used in this release:

Blended royalty rate is defined as total royalty dollars divided by total franchise sales dollars, as reported by franchisees.

Company-owned comparable store sales represents the change in year-over-year sales for Company-owned stores opened for at least one full year. Franchise-operated comparable store sales, a Non-GAAP financial measure, represents the change in year-over-year sales for all Franchise Stores opened for at least one full year, as reported by franchisees, and excludes International Stores and Express format. System-wide comparable store sales, a Non-GAAP financial measure, represents the change in year-over-year sales for all Company and Franchise Stores opened for at least one full year, as reported by franchisees, and excludes International Stores and Express format. Comparable store sales includes closed locations for the periods in which they have comparable sales. Company-owned comparable store sales percentages as used herein may not be equivalent to Company-owned comparable store sales as defined or used by other companies. Franchise-operated comparable store sales percentages and System-wide comparable stores sales percentages as used herein are Non-GAAP financial measures and should not be considered in isolation or as substitute for other measures of performance prepared in accordance with generally accepted accounting principles in the United States. Management reviews the increase or decrease in comparable store sales compared with the same period in the prior year to assess business trends and make certain business decisions. The Company believes the data is useful in assessing the overall performance of the Jamba® brand and, ultimately, the performance of the Company, the Company-owned stores, and Franchise-operated stores.

Domestic system-wide sales are the sum of company-operated restaurant revenue and sales from domestic franchised stores. Our total revenue in our consolidated statements of operations is limited to company-operated store revenue, franchise revenue from our franchisees, and other revenue. Accordingly, domestic system-wide sales should not be considered in isolation or as a substitute for our results as reported under GAAP. Management believes that domestic system-wide sales are an important figure for investors, because they are widely used in the restaurant industry, including by our management, to evaluate brand scale and market penetration. We have included a reconciliation of domestic system-wide sales to total revenue.

New store openings, net of closures is defined as the count of new store openings, minus the count of store closures.

Non-GAAP Adjusted EBITDA is equal to net income, adjusted for: (a) depreciation and amortization; (b) interest income; (c) interest expense; (d) income taxes; (e) impairment expense; (f) stock based compensation expense; and (g) other one-time or extraordinary items that are not reflective of the ongoing business such as legal settlements, expenses related to the extended audit and gain or loss resulting from refranchising activities. The Company believes this metric is useful in measuring the operating performance of the Company.

Non-GAAP Adjusted EBITDA margin percent is defined as Adjusted EBITDA divided by Total Revenue.

Non-GAAP Adjusted General and Administrative (“G&A”) expense is calculated as general and administrative expense in accordance with GAAP excluding refranchise and severance costs associated with the move to an asset-light business model, charges related to the executive organization changes, costs due to the Company’s corporate office relocation to Frisco, Texas, and other non-recurring general and administrative expenses. The Company believes that general and administrative expense adjusted to exclude the costs of such items is a helpful indicator of the Company's operating performance in that it shows the net expense without the impact of what the Company believes to be upfront transitional costs. Management does not believe such costs are reflective of the Company's ongoing performance and accordingly excludes those items from Non-GAAP Adjusted General and Administrative Expense.

 
JAMBA, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per value data)
(Unaudited)
 
  13-Week Period Ended
April 4,   March 29,
2017 2016
Revenue:
Company stores $ 11,107 $ 11,953
Franchise and other revenue   6,506     6,801  
Total revenue   17,613     18,754  
 
Costs and operating expenses:
Cost of sales 2,662 2,962
Labor 4,288 4,158
Occupancy 1,763 2,036
Store operating 1,798 2,021
Depreciation and amortization 881 1,502
General and administrative 8,601 7,610
Loss on disposal of assets 162 109
Store pre-opening 238 324
Store lease termination and closure 181 120
Other operating, net   76     612  
Total costs and operating expenses   20,650     21,454  
Income (loss) from operations (3,037 ) (2,700 )
 
Other income (expenses):
Interest income 54 71
Interest expense   (83 )   (59 )
Total other income (expenses), net (29 ) 12
 
Income (loss) before income taxes (3,066 ) (2,688 )
Income tax expense   (86 )   (132 )
Net income (loss) $ (3,152 ) $ (2,820 )
 
Share Data:
Weighted-average shares used in the computation of income (loss) per share:
Basic 15,411,695 15,084,037
Diluted 15,411,695 15,084,037
Income (loss) per share:
Basic $ (0.20 ) $ (0.19 )
Diluted $ (0.20 ) $ (0.19 )
 
 
JAMBA, INC.
CONSOLIDATED BALANCE SHEETS
(In thousands, except per share data)
(unaudited)
 
  April 4,   January 3,
2017 2017
ASSETS
Current Assets:
Cash and cash equivalents $ 8,192 $ 7,133
Receivables, net of allowances of $705 and $1,808 8,951 11,778
Inventories 465 534
Prepaid rent 815 1,053
Assets held for sale 136 206
Prepaid expenses and other current assets   3,495     3,000  
Total current assets 22,054 23,704
Property, fixtures and equipment, net of accumulated depreciation of $30,869 and $38,645 11,844 12,512
Goodwill 1,183 1,183
Trademarks and other intangible assets, net of accumulated amortization of $785 and $2,606 1,299 1,327
Notes receivable and other long-term assets   2,822     2,894  
Total assets $ 39,202   $ 41,620  
LIABILITIES AND SHAREHOLDERS' (DEFICIT) EQUITY
Current Liabilities:
Accounts payable $ 12,861 $ 10,407
Accrued compensation and benefits 3,678 4,255
Accrued gift card liability 21,733 24,131
Other current liabilities   8,682     7,664  
Total current liabilities 46,954 46,457
Deferred rent and other long-term liabilities   8,964     8,940  
Total liabilities 55,918 55,397
Commitments and contingencies
Shareholders’ (deficit) equity:
Common stock, $0.001 par value—30,000,000 shares authorized; 18,281,474 and 15,422,657 shares issued and outstanding, respectively, at April 4, 2017, and 18,268,885 and 15,410,068 shares issued and outstanding, respectively, at January 3, 2017 18 18
Additional paid-in capital 407,786 407,273
Treasury shares, at cost, 2,858,817 (40,009 ) (40,009 )
Accumulated deficit   (384,511 )   (381,059 )
Total shareholders’ (deficit) equity   (16,716 )   (13,777 )
Total liabilities and shareholders' (deficit) equity $ 39,202   $ 41,620  
 
 
JAMBA, INC.
(Unaudited)
REVENUE
   
13-Week Period Ended
April 4, 2017 March 29, 2016
Revenue (in thousands):
Company stores $ 11,107 $ 11,953
Franchise revenue 5,752 5,610
Other revenue   754     1,191  
Total revenue $ 17,613   $ 18,754  
 
JAMBA, INC.
(Unaudited)
RECONCILIATION OF GENERAL AND ADMINISTRATIVE TO NON-GAAP ADJUSTED GENERAL AND ADMINISTRATIVE
 
13-Week Period Ended
April 4, 2017 March 29, 2016
General and administrative (in thousands): $ 8,601 $ 7,610
Corporate relocation expenses (1,295 )
Audit related expenses (571 )
Other non-recurring expenses   (2,294 )   (1,650 )
Non-GAAP Adjusted General and administrative $ 4,441   $ 5,960  
 
JAMBA, INC.
(Unaudited)
RECONCILIATION OF NET LOSS TO NON-GAAP ADJUSTED EBITDA
 
13-Week Period Ended
April 4, 2017 March 29, 2016
Net Loss (in thousands): $ (3,152 ) $ (2,820 )
Depreciation and amortization 881 1,502
Interest income (54 ) (71 )
Interest expense 83 59
Income taxes 86 132
Stock based compensation 148 831
Other non-recurring expenses   5,013     1,650  
Non-GAAP Adjusted EBITDA $ 3,005   $ 1,283  
 
JAMBA, INC.
(Unaudited)
RECONCILIATION OF NON-GAAP DOMESTIC SYSTEMWIDE SALES
 
13-Week Period Ended
April 4, 2017 March 29, 2016
Total Revenue (in thousands): $ 17,613 $ 18,754
Franchise and other revenue (6,506 ) (6,801 )
Domestic franchise sales   105,928     103,550  
Non-GAAP domestic system-wide sales $ 117,035   $ 115,503  
 
 
JAMBA, INC.
(Unaudited)
 
COMPARABLE STORE SALES    
 

Fiscal Calendar Basis

13-Weeks Ended
April 4, 2017 vs March 29, 2016 vs
Increase/(Decrease) March 29, 2016 March 31, 2015
Percentage Change in Comparable store sales
Company stores (4.5 )% 0.2 %
Franchise stores (2.2 )% (2.4 )%
System-wide (2.5 )% (2.1 )%
 

Comparable Calendar Basis (a)

13-Weeks Ended
April 4, 2017 vs March 29, 2016 vs
Increase/(Decrease) April 5, 2016 March 31, 2015
Percentage Change in Comparable store sales
Company stores (7.3 )% 0.2 %
Franchise stores (5.6 )% (2.4 )%
System-wide (5.8 )% (2.1 )%
 
Percentage Change in Comparable calendar

Company store sales

Traffic (9.9 )% (4.5 )%
Average check 2.6 % 4.7 %
Total Comparable Company store sales (7.3 )% 0.2 %
 

(a) Due to a 53 week fiscal 2016, year-over-year fiscal comparisons are offset by one week. Using comparable calendar periods balances the one week shift and provides a clearer year over year comparison. 2016 fiscal and calendar comparisons are the same.

 
 
JAMBA, INC.
(Unaudited)
       
STORE COUNT
NUMBER OF STORES
COMPANY FRANCHISE TOTAL
Domestic International
For the Quarter Ended April 4, 2017
At January 3, 2017 66 726 70 862
Opened 13 2 15
Acquired
Closed (5 ) (4 ) (9 )
Refranchised        
At April 4, 2017 66   734   68   868  
 
For the Quarter Ended March 29, 2016(a)
At December 29, 2015 70 706 75 851
Opened 10 3 13
Acquired
Closed (2 ) (7 ) (13 ) (22 )
Refranchised        
At March 29, 2016 68   709   65   842  
 
(a) As communicated on March 20, 2017, the Company now excludes Express format stores from store counts. Store counts exclude Express in both 2016 and 2017 for comparability.
 
 
JAMBA, INC.
(Unaudited)
 
NEW STORE OPENINGS, NET OF CLOSURES
  13-Weeks Ended
April 4, 2017   March 29, 2016 (a)
Openings
Traditional 11 7
Non-traditional 1 3
Drive thru 1
International 2   3  
Total 15   13  
 
Closures
Traditional (2 ) (2 )
Non-traditional (3 ) (7 )
Drive thru
International (4 ) (13 )
Total (9 ) (22 )
 
Openings, Net of Closures(b)
Traditional 9 5
Non-traditional (2 ) (4 )
Drive thru 1
International (2 ) (10 )
Total 6   (9 )
 
(a) As communicated on March 20, 2017, the Company now excludes Express format stores from store counts. Store counts exclude Express in both 2016 and 2017 for comparability.
(b) New store openings, net of closures is defined as the count of new store openings, minus the count of store closures.
 
 
JAMBA, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per value data)
(Unaudited)
       
13-Week Period Ended 26-Week Period Ended

July 4, 2017

June 28, 2016

July 4, 2017

June 28, 2016

Revenue:
Company stores $ 13,262 $ 13,874 $ 24,369 $ 25,827
Franchise and other revenue   7,252     7,666     13,758     14,467  
Total revenue   20,514     21,540     38,127     40,294  
 
Costs and operating expenses:
Cost of sales 2,928 3,321 5,590 6,283
Labor 4,281 4,668 8,569 8,826
Occupancy 1,711 1,900 3,474 3,936
Store operating 2,531 2,272 4,329 4,293
Depreciation and amortization 899 1,674 1,780 3,176
General and administrative 6,757 9,423 15,358 17,033
Loss (gain) on disposal of assets 392 188 554 297
Store pre-opening 105 326 343 650
Impairment of long-lived assets 127 127
Store lease termination and closure 57 (56 ) 238 64
Other operating, net   (867 )   245     (791 )   857  
Total costs and operating expenses   18,794     24,088     39,444     45,542  
Income (loss) from operations 1,720 (2,548 ) (1,317 ) (5,248 )
 
Other income (expenses):
Interest income 41 74 95 145
Interest expense   (83 )   (59 )   (166 )   (118 )
Total other income (expenses), net (42 ) 15 (71 ) 27
 
Income (loss) before income taxes 1,678 (2,533 ) (1,388 ) (5,221 )
Income tax (expense) benefit   47     54     (39 )   (78 )
Net income (loss) $ 1,725   $ (2,479 ) $ (1,427 ) $ (5,299 )
 
Share Data:
Weighted-average shares used in the computation of income (loss) per share:
Basic 15,472,137 15,168,348 15,441,916 15,126,192
Diluted 15,867,544 15,168,348 15,441,916 15,126,192
Income (loss) per share:
Basic $ 0.11 $ (0.16 ) $ (0.09 ) $ (0.35 )
Diluted $ 0.11 $ (0.16 ) $ (0.09 ) $ (0.35 )
 
 
JAMBA, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except per share data)
(unaudited)
 
  July 4,   January 3,
2017 2017
ASSETS
Current Assets:
Cash and cash equivalents $ 11,246 $ 7,133
Receivables, net of allowances of $789 and $1,808 9,993 11,778
Inventories 469 534
Prepaid rent 778 1,053
Assets held for sale 18 206
Prepaid expenses and other current assets   3,234     3,000  
Total current assets 25,738 23,704
Property, fixtures and equipment, net of accumulated depreciation of $31,772 and $38,645 11,026 12,512
Goodwill 1,181 1,183
Trademarks and other intangible assets, net of accumulated amortization of $813 and $2,606 1,270 1,327
Notes receivable and other long-term assets   914     2,894  
Total assets $ 40,129   $ 41,620  
LIABILITIES AND SHAREHOLDERS' (DEFICIT) EQUITY
Current Liabilities:
Accounts payable $ 11,092 $ 10,407
Accrued compensation and benefits 1,991 4,255
Accrued gift card liability 23,526 24,131
Other current liabilities   9,152     7,664  
Total current liabilities 45,761 46,457
Deferred rent and other long-term liabilities   8,383     8,940  
Total liabilities 54,144 55,397
Commitments and contingencies
Shareholders’ (deficit) equity:
Common stock, $0.001 par value—30,000,000 shares authorized; 18,427,023 and 15,568,206 shares issued and outstanding, respectively, at July 4, 2017, and 18,268,885 and 15,410,068 shares issued and outstanding, respectively, at January 3, 2017 18 18
Additional paid-in capital 408,762 407,273
Treasury shares, at cost, 2,858,817 (40,009 ) (40,009 )
Accumulated deficit   (382,786 )   (381,059 )
Total shareholders’ (deficit) equity   (14,015 )   (13,777 )
Total liabilities and shareholders' (deficit) equity $ 40,129   $ 41,620  
 
 
JAMBA, INC.
(Unaudited)
REVENUE
 
13-Week Period Ended 26-Week Period Ended
July 4, 2017 June 28, 2016 July 4, 2017 June 28, 2016
Revenue (in thousands):
Company stores $ 13,262 $13,874 $24,369 $25,827
Franchise revenue 6,951 6,441 12,704 11,922
Other revenue   301   1,225   1,054   2,545  
Total revenue $ 20,514   $21,540   $38,127   $40,294  
 
JAMBA, INC.
(Unaudited)

RECONCILIATION OF GENERAL AND ADMINISTRATIVE TO NON-GAAP ADJUSTED GENERAL
AND ADMINISTRATIVE

   
 
13-Week Period Ended 26-Week Period Ended
July 4, 2017 June 28, 2016 July 4, 2017 June 28, 2016
General and administrative (in thousands): $ 6,757 $9,423 $15,358 $ 17,033
Corporate relocation expenses (380 ) (2,722 ) (1,675 ) (2,722 )
Audit related expenses (863 ) (1,434 )
Other non-recurring expenses   (195 ) (1,096 ) (2,489 )   (2,747 )
Non-GAAP Adjusted General and administrative $ 5,319   $5,605   $9,760   $ 11,564  
 
JAMBA, INC.
(Unaudited)
RECONCILIATION OF NET INCOME (LOSS) TO NON-GAAP ADJUSTED EBITDA
 
13-Week Period Ended 26-Week Period Ended
July 4, 2017 June 28, 2016 July 4, 2017 June 28, 2016
Net Income (Loss) (in thousands): $ 1,725 $(2,479 ) $(1,427 ) $(5,299 )
Depreciation and amortization 899 1,674 1,780 3,176
Interest income (41 ) (74 ) (95 ) (145 )
Interest expense 83 59 166 118
Income taxes (47 ) (54 ) 39 78
Stock based compensation 497 867 645 1,698
Other non-recurring expenses   1,965   3,818   6,978   5,469  
Non-GAAP Adjusted EBITDA $ 5,081   $3,811   $8,086   $5,095  
 
JAMBA, INC.
(Unaudited)
RECONCILIATION OF NON-GAAP DOMESTIC SYSTEMWIDE SALES
   
13-Week Period Ended
July 4, 2017 June 28, 2016
Total Revenue (in thousands): $20,514 $21,540
Franchise and other revenue (7,252 ) (7,666 )
Domestic franchise sales 126,559   123,515  
Non-GAAP domestic system-wide sales $139,821   $137,389  
 
 
JAMBA, INC.
(Unaudited)
       
COMPARABLE STORE SALES
 

Fiscal Calendar Basis

13-Weeks Ended 26-Weeks Ended
July 4, 2017 vs June 28, 2016 vs July 4, 2017 vs June 28, 2016 vs
Increase/(Decrease) June 28, 2016 June 30, 2015 June 28, 2016 June 30, 2015
Percentage Change in Comparable store sales
Company stores 0.9 % 5.7 % (1.6 )% 3.0 %
Franchise stores (1.0 )% 4.0 % (1.5 )% 1.1 %
System-wide (0.8 )% 4.2 % (1.5 )% 1.3 %
 

Comparable Calendar Basis (a)

13-Weeks Ended 26-Weeks Ended
July 4, 2017 vs June 28, 2016 vs July 4, 2017 vs June 28, 2016 vs
Increase/(Decrease) July 5, 2016 June 30, 2015 July 5, 2016 June 30, 2015
Percentage Change in Comparable store sales
Company stores 1.0 % 5.7 % (3.0 )% 3.0 %
Franchise stores (0.2 )% 4.0 % (2.7 )% 1.1 %
System-wide (0.0 )% 4.2 % (2.7 )% 1.3 %
 
Percentage Change in Comparable calendar Company store sales
Traffic (2.9 )% 1.4 % (6.2 )% (1.6 )%
Average check 3.9 % 4.3 % 3.3 % 4.6 %
Total Comparable Company store sales 1.0 % 5.7 % (3.0 )% 3.0 %
 
(a) Due to a 53 week fiscal 2016, year-over-year fiscal comparisons are offset by one week. Using comparable calendar periods balances the one week shift and provides a clearer year over year comparison. 2016 fiscal and calendar comparisons are the same.
 
 
JAMBA, INC.
(Unaudited)
       
STORE COUNT
NUMBER OF STORES
COMPANY FRANCHISE TOTAL
Domestic International
For the Quarter Ended July 4, 2017
At April 4, 2017 66 734 68 868
Opened 6 4 10
Acquired
Closed (8 ) (8 )
Refranchised (13 ) 13      
At July 4, 2017 53   745   72   870  
 
For the Quarter Ended June 28, 2016 (a)
At March 29, 2016 68 709 65 842
Opened 1 8 2 11
Acquired
Closed (1 ) (9 ) (1 ) (11 )
Refranchised        
At June 28, 2016 68   708   66   842  
 
(a) As communicated on March 20, 2017, the Company now excludes Express format stores from store counts. Store counts exclude Express in both 2016 and 2017 for comparability.
 
 
JAMBA, INC.
(Unaudited)
       
NEW STORE OPENINGS, NET OF CLOSURES
13-Weeks Ended 26-Weeks Ended
July 4, 2017 June 28, 2016 (a) July 4, 2017 June 28, 2016 (a)
Openings
Traditional 4 4 15 11
Non-traditional 4 1 7
Drive thru 2 1 3 1
International 4   2   6   5  
Total 10   11   25   24  
 
Closures
Traditional (3 ) (3 ) (5 ) (5 )
Non-traditional (5 ) (7 ) (8 ) (14 )
Drive thru
International   (1 ) (4 ) (14 )
Total (8 ) (11 ) (17 ) (33 )
 
Openings, Net of Closures(b)
Traditional 1 1 10 6
Non-traditional (5 ) (3 ) (7 ) (7 )
Drive thru 2 1 3 1
International 4   1   2   (9 )
Total 2     8   (9 )
 
(a) As communicated on March 20, 2017, the Company now excludes Express format stores from store counts. Store counts exclude Express in both 2016 and 2017 for comparability.
(b) New store openings, net of closures is defined as the count of new store openings, minus the count of store closures.
 
 
JAMBA, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per value data)
(Unaudited)
 
  13-Week Period Ended   39-Week Period Ended

October 3,
2017

 

September 27,
2016

October 3,
2017

 

September 27,
2016

Revenue:
Company stores $ 11,222 $ 14,350 $ 35,591 $ 40,177
Franchise and other revenue   6,934     7,711     20,692     22,178  
Total revenue   18,156     22,061     56,283     62,355  
 
Costs and operating expenses:
Cost of sales 2,460 3,437 8,050 9,720
Labor 3,589 4,644 12,158 13,470
Occupancy 1,504 1,879 4,978 5,815
Store operating 1,988 2,381 6,317 6,674
Depreciation and amortization 897 1,068 2,677 4,244
General and administrative 6,505 9,699 21,863 26,732
Loss (gain) on disposal of assets 117 204 671 501
Store pre-opening 150 210 493 860
Impairment of long-lived assets 229 356
Store lease termination and closure (29 ) 178 209 242
Other operating, net   1,336     104     545     961  
Total costs and operating expenses 18,517 24,033 57,961 69,575
Income (loss) from operations (361 ) (1,972 ) (1,678 ) (7,220 )
 
Other income (expenses):
Interest income 2 50 97 195
Interest expense   (81 )   (51 )   (247 )   (169 )
Total other income (expenses), net (79 ) (1 ) (150 ) 26
 
Income (loss) before income taxes (440 ) (1,973 ) (1,828 ) (7,194 )
Income tax (expense) benefit   (17 )   9     (56 )   (69 )
Net income (loss) $ (457 ) $ (1,964 ) $ (1,884 ) $ (7,263 )
 
Share Data:
Weighted-average shares used in the computation of income (loss) per share:
Basic 15,580,074 15,292,699 15,487,969 15,181,695
Diluted 15,580,074 15,292,699 15,487,969 15,181,695
Income (loss) per share:
Basic $ (0.03 ) $ (0.13 ) $ (0.12 ) $ (0.48 )
Diluted $ (0.03 ) $ (0.13 ) $ (0.12 ) $ (0.48 )
 
 
JAMBA, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except per share data)
(unaudited)
 
  October 3,   January 3,
2017 2017
ASSETS
Current Assets:
Cash and cash equivalents $ 11,871 $ 7,133
Receivables, net of allowances of $877 and $1,808 7,270 11,778
Inventories 466 534
Prepaid rent 779 1,053
Assets held for sale 206
Prepaid expenses and other current assets   2,972     3,000  
Total current assets 23,358 23,704
Property, fixtures and equipment, net of accumulated depreciation of $31,942 and $38,645 10,991 12,512
Goodwill 1,181 1,183
Trademarks and other intangible assets, net of accumulated amortization of $828 and $2,606 1,239 1,327
Notes receivable and other long-term assets   923     2,894  
Total assets $ 37,692   $ 41,620  
LIABILITIES AND SHAREHOLDERS' (DEFICIT) EQUITY
Current Liabilities:
Accounts payable $ 9,630 $ 10,407
Accrued compensation and benefits 2,430 4,255
Accrued gift card liability 22,381 24,131
Other current liabilities   9,368     7,664  
Total current liabilities 43,809 46,457
Deferred rent and other long-term liabilities   7,819     8,940  
Total liabilities 51,628 55,397
Commitments and contingencies
Shareholders’ (deficit) equity:
Common stock, $0.001 par value—30,000,000 shares authorized; 18,447,023 and 15,588,206 shares issued and outstanding, respectively, at October 3, 2017, and 18,268,885 and 15,410,068 shares issued and outstanding, respectively, at January 3, 2017 18 18
Additional paid-in capital 409,298 407,273
Treasury shares, at cost 2,858,817 (40,009 ) (40,009 )
Accumulated deficit   (383,243 )   (381,059 )
Total shareholders’ (deficit) equity   (13,936 )   (13,777 )
Total liabilities and shareholders' (deficit) equity $ 37,692   $ 41,620  
 
 
JAMBA, INC.
(Unaudited)
REVENUE
     
13-Week Period Ended 39-Week Period Ended
October 3, 2017 September 27, 2016 October 3, 2017 September 27, 2016
Revenue (in thousands):
Company stores $ 11,222 $14,350 $35,591 $ 40,177
Franchise revenue 6,673 6,220 19,376 18,142
Other revenue   261   1,491   1,316     4,036  
Total revenue $ 18,156   $22,061   $56,283   $ 62,355  
 
JAMBA, INC.
(Unaudited)
RECONCILIATION OF GENERAL AND ADMINISTRATIVE TO NON-GAAP ADJUSTED GENERAL AND ADMINISTRATIVE
 
13-Week Period Ended 39-Week Period Ended
October 3, 2017 September 27, 2016 October 3, 2017 September 27, 2016
General and administrative (in thousands): $ 6,505 $9,699 $21,863 $ 26,732
Corporate relocation expenses (69 ) (2,880 ) (1,741 ) (5,602 )
Audit related expenses (1,936 ) (3,369 )
Other non-recurring expenses   (531 ) (1,538 ) (3,020 )   (4,285 )
Non-GAAP Adjusted General and administrative $ 3,969   $5,281   $13,733   $ 16,845  
 
JAMBA, INC.
(Unaudited)
RECONCILIATION OF NET LOSS TO NON-GAAP ADJUSTED EBITDA
 
13-Week Period Ended 39-Week Period Ended
October 3, 2017 September 27, 2016 October 3, 2017 September 27, 2016
Net Loss (in thousands): $ (457 ) $(1,964 ) $(1,884 ) $ (7,263 )
Depreciation and amortization 897 1,068 2,677 4,244
Interest income (2 ) (50 ) (97 ) (195 )
Interest expense 81 51 247 169
Income taxes 17 (9 ) 56 69
Stock based compensation 374 668 1,020 2,366
Other non-recurring expenses   3,817   4,347   10,794     9,816  
Non-GAAP Adjusted EBITDA $ 4,727   $4,111   $12,813   $ 9,206  
 
JAMBA, INC.
(Unaudited)
RECONCILIATION OF NON-GAAP DOMESTIC SYSTEMWIDE SALES
   
13-Week Period Ended
October 3, 2017 September 27, 2016
Total Revenue (in thousands): $18,156 $22,061
Franchise and other revenue (6,934 ) (7,711 )
Domestic franchise sales 124,866   118,568  
Non-GAAP domestic system-wide sales $136,088   $132,918  
 
 
JAMBA, INC.
(Unaudited)
       
COMPARABLE STORE SALES
 

Fiscal Calendar Basis

13-Weeks Ended 39-Weeks Ended
October 3, 2017 vs September 27, 2016 vs October 3, 2017 vs September 27, 2016 vs
Increase/(Decrease) September 27, 2016 September 29, 2015 September 27, 2016 September 29, 2015
Percentage Change in Comparable

store sales

Company stores (3.8 )% (0.8 )% (2.3 )% 1.6 %
Franchise stores (0.6 )% (1.1 )% (1.2 )% 0.2 %
System-wide (0.9 )% (1.1 )% (1.3 )% 0.4 %
 

Comparable Calendar Basis (a)

13-Weeks Ended 39-Weeks Ended
October 3, 2017 vs September 27, 2016 vs October 3, 2017 vs September 27, 2016 vs
Increase/(Decrease) October 4, 2016 September 29, 2015 October 4, 2016 September 29, 2015
Percentage Change in Comparable

store sales

Company stores (3.9 )% (0.8 )% (3.3 )% 1.6 %
Franchise stores 0.2 % (1.1 )% (1.7 )% 0.2 %
System-wide (0.2 )% (1.1 )% (1.9 )% 0.4 %
 
Percentage Change in Comparable

calendar Company store sales

Traffic (7.2 )% (1.8 )% (6.5 )% (1.6 )%
Average check 3.3 % 0.9 % 3.3 % 3.2 %
Total Comparable Company store sales (3.9 )% (0.8 )% (3.3 )% 1.6 %
 
(a) Due to a 53 week fiscal 2016, year-over-year fiscal comparisons are offset by one week. Using comparable calendar periods balances the one week shift and provides a clearer year over year comparison. 2016 fiscal and calendar comparisons are the same.
 
 
JAMBA, INC.
(Unaudited)
       
STORE COUNT
NUMBER OF STORES
COMPANY FRANCHISE TOTAL
Domestic International
For the Quarter Ended October 3, 2017
At July 4, 2017 53 745 72 870
Opened 8 2 10
Acquired
Closed (1 ) (10 ) (3 ) (14 )
Refranchised        
At October 3, 2017 52   743   71   866  
 
For the Quarter Ended September 27, 2016 (a)
At June 28, 2016 68 708 66 842
Opened 1 10 5 16
Acquired
Closed (6 ) (3 ) (9 )
Refranchised        
At September 27, 2016 69   712   68   849  
 
(a) As communicated on March 20, 2017, the Company now excludes Express format stores from store counts. Store counts exclude Express in both 2016 and 2017 for comparability.
 
 
JAMBA, INC.
(Unaudited)
       
NEW STORE OPENINGS, NET OF CLOSURES
13-Weeks Ended 39-Weeks Ended
October 3, 2017 September 27, 2016 (a) October 3, 2017 September 27, 2016 (a)
Openings
Traditional 3 9 18 20
Non-traditional 4 1 5 8
Drive thru 1 1 4 2
International 2   5   8   10  
Total 10   16   35   40  
 
Closures
Traditional (5 ) (5 ) (10 ) (10 )
Non-traditional (6 ) (1 ) (14 ) (15 )
Drive thru
International (3 ) (3 ) (7 ) (17 )
Total (14 ) (9 ) (31 ) (42 )
 
Openings, Net of Closures(b)
Traditional (2 ) 4 8 10
Non-traditional (2 ) (9 ) (7 )
Drive thru 1 1 4 2
International (1 ) 2   1   (7 )
Total (4 ) 7   4   (2 )
 
(a) As communicated on March 20, 2017, the Company now excludes Express format stores from store counts. Store counts exclude Express in both 2016 and 2017 for comparability.
(b) New store openings, net of closures is defined as the count of new store openings, minus the count of store closures.
 
 
JAMBA, INC.
(Unaudited)
 
RECONCILIATION OF 2017 GUIDANCE GENERAL AND ADMINISTRATIVE TO NON-GAAP ADJUSTED GENERAL AND ADMINISTRATIVE
 
(in millions) Approximately
 
General and Administrative $ 28.7
Corporate relocation expenses (1.8 )
Audit related expenses (5.3 )
Other non-recurring expenses   (3.6 )
Non-GAAP Adjusted General and Administrative $ 18.0  
 
 
JAMBA, INC.
(Unaudited)
 
RECONCILIATION OF 2017 GUIDANCE NET LOSS TO NON-GAAP ADJUSTED EBITDA
 
(in millions) Approximately
Net Loss $ (4.0 )
Depreciation and amortization 3.5
Interest income (0.1 )
Interest expense 0.3
Income taxes (0.0 )
Stock based compensation 1.2
Other non-recurring expenses   13.6  
Non-GAAP Adjusted EBITDA $ 14.5  

Source: Jamba, Inc.

Jamba, Inc.
Investor Relations
Dara Dierks, 646-277-1212
investors@jambajuice.com



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