Jamba States FY12 & FY13 View - Analyst Blog
Emeryville, California-based Jamba Inc. ( JMBA ) reaffirmed its previously issued operating guidance for fiscal 2012 and declared its expansionary plans, brand modernization initiatives, addition of new products in its pipeline and BLEND Plan 3.0 for fiscal 2013.
Fiscal 2012 Guidance
As per the guidance, the company continues to expect that its company-owned comparable store sales will grow by 4%-6% in fiscal 2012. Jamba's management had provided a detailed financial outlook for fiscal 2012 when it reported the third quarter results. Consumer Packaged Goods (CPG) licensing revenue is expected to be nearly $3 million.
The company projects that adjusted operating profit margin will be within 20%-23%. In fiscal 2012, general and administrative costs are expected to remain consistent year over year.
On the expansion front, management plans to open 40-50 new restaurants in U.S. In addition, the company is also planning to unveil nearly 15 outlets overseas and 400-500 JambaGO units in fiscal 2012.
Apart from the guidance, the company also intends to focus on innovation of new brands, advertising programs and product extensions. In this regard, the company is venturing into emerging markets by forming new partnerships and acquisitions.
Earlier in 2012, Jamba had acquired Talbott Teas to enhance its health and wellness business. Moreover, the company has also declared acquisition of Nestle's Intellectual Property to boost its Jamba All-Natural Energy Drinks platform.
BLEND Plan 3.0
The company is continuously gaining from its BLEND Plan 2.0 initiatives in terms of cost and efficiency and now expects that its newly launched BLEND Plan 3.0 would further augment its growth in fiscal 2013.
With the new plan, the company will improve its brand value through enhancing its menu format and upgrading its store style in fiscal 2013. The company will also benefit from the expansion of its limited menu Smoothie Stations as well JambaGO and CPG growth under Jamba-brand.
Fiscal 2013 Outlook
The company also provided fiscal 2013 guidance. The company anticipates that its company-owned comparable store sales will increase 4%-6%. Moreover, CPG revenue at Jamba will be within $4 million - $5 million. Store-level margins are expected to be 20%.
In fiscal 2013, the company is planning to launch 60-80 stores in U.S. and worldwide. The company is also expecting to launch 1,000 JambaGO units and 100 Smoothie Stations. Further, the company's guidance includes revamping 100 stores.
Jamba owns and franchises Jamba Juice stores and also operates as a restaurant retailer of specialty beverages and various food products across the globe. During the third quarter of fiscal 2012, the company was operating 473 franchised and 301 company owned stores. The company also owns 35 franchised units across three international markets.
Currently, Jamba retains a Zacks Rank#5 (Strong Sell). We maintain our long-term 'Underperform' recommendation on the stock.
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