(JMBA), through its subsidiary, Jamba Juice Company, offers
delicious blended beverages, juices, and fruit smoothies. The
company just reported third-quarter EPS of $0.15 cents missing the
consensus of 18 cents by 16.7% and the year-ago quarter's earnings
of 21 cents by 28.6%.
Total revenue in the quarter was down 6.3% year over year to $61.4
million owing to the decline in company sales and lower comps.
Quarterly revenues were also below the Zacks Consensus Estimate of
$62 million by nearly 1%.
Less to Squeeze?
The company could offer a host of reasons to explain the sales and
profits dip, including the uncertain economic and political
environment, which may have led cash-conscious customers to spend
less on eating out. Adverse weather in some major markets also
seems to be responsible for such disappointing results in the third
But the bottom line for food, just like fashion, is that customers
can be fickle and the competition can be fierce. With new venues
like Protein Bar in Chicago offering healthy, delicious, and fast
shakes, the Jamba appeal may be less juicy. And the Zacks Price
& Consensus chart below shows what the analysts think of the
numbers going forward...
Sales at the company stores dropped 7.6% year over year to $57.1
million in the third quarter. Comps (same-store sales) in the
quarter were mostly affected by low consumer spending, inclement
weather in major markets and stiff competition. Failure of some
marketing campaigns has also been held responsible for such lower
Franchise and other revenues were up 15.8% year over year to $4.3
million, driven by increased royalties. CPG and JambaGO revenues
were $0.8 million as against $0.7 million in the year-earlier
Comps at franchise-operated restaurants declined 1.3% during the
third quarter versus comps growth of 1.0% in the year-ago quarter.
System-wide comps were down 3.4% as against the year-ago quarter's
comps growth of 2.5%. Operating margin decreased 150 bps year over
year to 5.4% due to lower top line.
Jamba operates 849 stores including 517 franchised and 287
company-owned units. The company unveiled 26 franchised restaurants
in the domestic market and three stores at international locations.
During the quarter, they introduced JambaGO machines in 1000
markets, bringing the total number of JambaGO served locations to
The company plans to set up 60-80 stores in the U.S. and
international market in 2013 as well as in 2014. They also intend
to add JambaGO stations in another 1,000 new locations by the end
Emeryville, California-based Jamba lowered its guidance for 2013
following the lackluster third-quarter results. The company expects
company-owned comps to be flat to up 1% as against the comps growth
Store-level operating margin is estimated to be 16%-17%, down from
20%. Operating margin was guided in the range of 1% to 2%, down
from the prior expectation of 2.5%-3.0%.
This outlook made it easy for analysts to slash their growth
estimates. So, while the store growth and innovation in the form of
JambaGO stations are impressive, we need to see the earnings
estimates turn back up before we can get excited about this juicy
Kevin Cook is a Senior Stock Strategist for Zacks where he runs
Follow The Money
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