Inventure Foods Reports Third Quarter 2013 Results

              Inventure Foods Reports Third Quarter 2013 Results

Net Revenues up 17.0%; EPS $0.11

PR Newswire

PHOENIX, Oct. 31, 2013

PHOENIX, Oct. 31, 2013 /PRNewswire/ --Inventure Foods, Inc. (Nasdaq: SNAK), a
leading specialty food marketer and manufacturer, today reported financial
results for the third quarter ended September 28, 2013.

Third Quarter 2013 Highlights

For the third quarter of 2013 compared to the third quarter of 2012:

  oNet revenues increased 17.0% to a record $54.5 million, or 19.7% adjusting
    for the prior year sale of the Company's DSD business.
  oDiluted earnings per share were $0.11, compared to $0.09.
  oSigned letter of intent to purchase Fresh Frozen Foods, LLC, a frozen
    vegetable processor.

Quarter Overview

Consolidated net revenues for the 2013 third quarter were $54.5 million, an
increase of 17.0% compared to the prior year, or an increase of 19.7%
adjusting for the prior year sale of Inventure's DSD business. The increase
in net revenues for the quarter was largely driven by a 20.8% increase in the
healthy/natural portfolio over the prior-year period. Gross profit increased
$0.6 million to $10.1 million, compared to $9.5 million in the prior year.
Gross profit margin declined 190 basis points to 18.4% from 20.3% last year,
primarily due to a decrease in sales of T.G.I.Friday's® products. Selling,
general and administrative expenses of $6.4 million remained relatively
consistent to the prior year expense of $6.5 million, but decreased 230 basis
points as a percentage of net sales compared to prior year. Net income
increased $0.4 million to $2.1 million compared to $1.7 million in the prior
year. Consolidated EBITDA increased 26.3% to $5.2 million, or 9.6% of net
revenues.

Frozen segment net revenues increased 20.5% to $27.5 million. Net revenues
for frozen berries increased 33.0% for the quarter due to continued sales
growth of branded frozen fruit, primarily due to the addition of Willamette
Valley Fruit Company. Net revenues from frozen beverages decreased 33.8%
compared to prior year, largely due to decreased Jamba sales in the Club
channel and slower growth of the frozen beverage category.

Snack segment net revenues of $27.0 million were up 13.6%, or 18.8% excluding
the impact of the sale of the DSD business. Boulder Canyon Natural Foods® net
revenues increased 27.5%, offset by an 18.6% decrease in sales of T.G.I.
Friday's. Net revenues of co-packed products increased almost 9 times over
the prior year with the addition of the new co-packing agreement earlier this
year.

Year-to-Date Overview

Consolidated net revenues for the nine months ended September 28, 2013 were
$156.7 million. Consolidated net revenues increased 10.7%, or 12.7% adjusting
for the prior year sale of the DSD business. The year-to-date increase in net
revenues was largely driven by an 18.2% increase in the healthy/natural
portfolio. Gross profit remained relatively consistent with the prior-year
period at $28.0 million and decreased 190 basis points compared to prior
year. Net income decreased 9.3% to $4.6 million, compared to net income of
$5.1 million in the prior year. Fully diluted earnings per share for the
first nine months of 2013 were $0.23, versus $0.26 during the same period in
2012. Consolidated EBITDA decreased 1.8% to $11.9 million, or 7.6% of net
revenues.

Management Commentary & Future Outlook

"We are pleased with another quarter of record net revenues, realizing
double-digit growth in both our healthy/natural and indulgent portfolios,"
said Terry McDaniel, Chief Executive Officer of Inventure Foods, Inc. "Our
healthy/natural products represented 63% of net revenues and sales growth of
20.8%. The strength of our frozen fruit business allows us to consistently
perform well against industry averages in the category, with a 33% increase in
the quarter versus the prior year. The addition of Willamette Valley Fruit
Company to our family of brands has also proven to be a great operations play,
adding to the growth of our frozen berry business in the third quarter. When
coupled with our planned acquisition of Fresh Frozen Foods, we create a
formidable presence in the frozen business that we believe can drive solid
sales and profit growth into the future."

"Our Boulder Canyon brand continued its strong performance, growing 27.5% over
last year, its fourth consecutive quarter of growth, reflecting the successful
launch of several new products this year. In frozen beverages, we also
continue to gain market share with our Jamba-At-Home® smoothies with the
introduction of the Green Fusion flavor and our recently introduced Seattle's
Best Frozen Coffee Blends. The overall frozen beverage category has dropped
over the last two quarters, but we are pleased with our sell through and
anticipate continued share gains in our market-leading Jamba products and the
introduction of our new Seattle's Best Coffee branded products."

"Our indulgent portfolio had net revenues of $20.2 million, up 17.7% from
prior year, on a comparable basis. This growth was driven by strong
contributions from our co-packing and premium private label businesses as well
as continued growth of our Vidalia brand. This growth helped to offset
continued softness in our T.G.I. Friday's brand, which was down 18.6% for the
quarter. We remain committed to the return to growth of this important
product line, and have been making progress by launching several new products
during theyear with more slated for the fourth quarter and early 2014."

McDaniel concluded, "We believe that the investments we have made so far this
year in our brands, product assortment, facilities and strategic acquisitions
will continue to position us well for driving shareholder value."

Conference Call

Inventure Foods' executive management team will host a conference call today
at 11 a.m. ET to discuss the Company's third quarter 2013 results and comment
on its future outlook. To participate in the conference call, please call
(877) 853-7702 toll-free, or (408) 940-3848 for international callers. A live
webcast of the call will also be available at www.inventurefoods.com and will
be archived for one year following today's event.

About Inventure Foods,Inc.

With manufacturing facilities in Arizona, Indiana, Washington and Oregon,
Inventure Foods, Inc. (Nasdaq: SNAK) is a marketer and manufacturer of
specialty food brands in better-for-you and indulgent categories under a
variety of Company owned and licensed brand names, including Boulder Canyon
Natural Foods®, Jamba®, Seattle's Best Coffee®, Rader Farms®, T.G.I.
Friday's®, Nathan's Famous®, Vidalia Brands®, Poore Brothers®, Tato Skins®,
Willamette Valley Fruit Company™ and Bob's Texas Style®. For further
information about Inventure Foods, please visit www.inventurefoods.com.

Statements contained in this press release that are not historical facts are
forward-looking statements as that term is defined in the Private Securities
Litigation Reform Act of 1995. Because such statements include risks and
uncertainties, actual results may differ materially from those expressed or
implied by such forward-looking statements. Factors that may cause actual
results to differ from the forward-looking statements contained in this press
release and that may affect the Company's prospects in general include, but
are not limited to, general economic conditions, increases in cost or
availability of ingredients, packaging, energy and employees, price
competition and industry consolidation, ability to execute strategic
initiatives, product recalls or safety concerns, disruptions of supply chain
or information technology systems, customer acceptance of new products and
changes in consumer preferences, food industry and regulatory factors,
interest rate risks, dependence upon major customers, dependence upon existing
and future license agreements, the possibility that we will need additional
financing due to future operating losses or in order to implement the
Company's business strategy, acquisition and divestiture-related risks, the
volatility of the market price of the Company's common stock, and such other
factors as are described in the Company's filings with the Securities and
Exchange Commission.



INVENTURE FOODS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share data)
(unaudited)
                        Quarter     Nine Months
                       Ended        Ended
                        September   September   September   September
                       28,           29,           28,           29,
                       2013          2012          2013         2012
Net revenues           $       $       $        $     
                       54,514       46,601       156,728      141,637
Cost of revenues       44,458        37,130        128,711       113,617
 Gross profit      10,056        9,471         28,017        28,020
Selling, general &
administrative         6,395         6,535         20,241        19,415
expenses
 Operating income  3,661         2,936         7,776         8,605
Interest expense, net  250           179           641           613
 Income       3,411         2,757         7,135         7,992
before income taxes
Income tax provision   1,263         1,017         2,524         2,907
 Net income        $       $       $       $      
                        2,148       1,740       4,611       5,085
Earnings per common
share:
 Basic             $       $       $       $      
                         0.11       0.09       0.24       0.27
 Diluted           $       $       $       $      
                         0.11       0.09       0.23       0.26
Weighted average
number of common
shares:
Basic             19,473        19,031        19,329        18,737
Diluted           19,843        19,690        19,746        19,537



INVENTURE FOODS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
                                                                                          
                                                                                  September   December
                                                                                  28,         29,
                                                                                  2013       2012
                                                                                  (unaudited)
Assets
Current
assets:
                                                                                  $      $   
 Cash and cash equivalents                                                           
                                                                                  819          
                                                                                              419
 Accounts receivable, net allowance                                            22,228      17,547
 Inventories                                                                   41,505      27,071
 Deferred income tax asset                                                     848         1,030
 Other current assets                                                          1,072       1,323
 Total current assets                                                      66,472      47,390
Property and equipment, net                                                       40,419      34,051
Goodwill                                                                          14,763      11,616
Trademarks and other intangibles, net                                             5,862       2,010
Other assets                                                                      948         827
                                                                                  $      $   
 Total assets                                                                    128,464    
                                                                                               95,894
Liabilities and Shareholders' Equity
Current liabilities:
                                                                                  $      $   
 Accounts payable                                                                          
                                                                                  12,733       12,178
 Accrued liabilities                                                           17,424      8,415
 Current portion of long-term debt                                             2,785       1,646
 Total current liabilities                                                 32,942      22,239
Long-term debt, less current portion                                              14,013      6,897
Line of credit                                                                    17,380      10,117
Deferred income tax liability                                                     4,019       3,968
Interest rate swaps                                                               577         766
Other liabilities                                                                 2,849       808
 Total liabilities                                                             71,780      44,795
Shareholders' equity:
Common stock                                                                      198         196
Additional paid-in capital                                                        30,516      29,660
Accumulated other comprehensive loss                                              (262)       (378)
Retained earnings                                                                 26,703      22,092
                                                                                  57,155      51,570
Less: treasury stock                                                              (471)       (471)
Total shareholders' equity                                                        56,684      51,099
                                                                                  $      $   
Total liabilities and shareholders' equity                                          128,464    
                                                                                               95,894



INVENTURE FOODS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
RECONCILIATION
(in thousands)
(unaudited)
                        Quarter Ended            Nine Months Ended
                        September   September   September   September
                       28,           29,           28,           29,
                                  
                       2013  2012  2013  2012
Reconciliation –
EBITDA^(1):
 Reported net     $       $       $       $      
income                  2,148       1,740       4,611       5,085
 Add back:        250           179           641           613
Interest, net
 Add back: Income 1,263         1,017         2,524         2,907
tax provision
 Add back:        1,478         1,196         4,023         3,474
Depreciation
 Add back:
Amortization of        83            3             88            21
intangible assets
 EBITDA           $       $       $       $      
                        5,222        4,135      11,887       12,100

(1) EBITDA is presented as a supplemental performance measure and is not
intended as an alternative to net income or any other measure calculated in
accordance with generally accepted accounting principles. Further, EBITDA may
not be comparable to similarly titled measures used by other companies.



SOURCE Inventure Foods, Inc.

Website: http://www.inventurefoods.com
Contact: Steve Weinberger, Chief Financial Officer, Inventure Foods, Inc.,
(623) 932-6200
 
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