John B. Sanfilippo & Son(JBSS) - 2025 Q3 - Quarterly Results

Financial Performance - Net sales for Q3 fiscal 2025 decreased by $11.0 million, or 4.0%, to $260.9 million, attributed to a 7.9% decrease in sales volume [3] - Diluted EPS increased by 49.6% to $1.72 per share, reflecting improved gross profit despite a decline in sales volume [4] - Gross profit increased by $6.7 million to $55.9 million, with gross margin rising to 21.4% from 18.1% in the prior year [9] - Gross profit margin decreased from 20.6% to 18.5% for the nine-month period, mainly due to increased commodity acquisition costs [17] Inventory and Assets - The value of total inventories increased by $47.1 million, or 22.4%, primarily due to higher quantities and costs of finished goods [11] - Inventories increased to $257,798 million in March 2025, up from $196,563 million in June 2024, reflecting a rise of 31.1% [23] - Total assets increased to $589,976 million in March 2025, up from $515,575 million in June 2024, representing a growth of 14.5% [23] - Cash reserves rose significantly to $1,295 million in March 2025, compared to $484 million in June 2024, marking an increase of 168.6% [23] - Accounts receivable decreased to $74,538 million in March 2025 from $84,960 million in June 2024, a decline of 12.2% [23] - The company reported a significant increase in prepaid expenses and other current assets, rising to $15,565 million in March 2025 from $12,078 million in June 2024, a growth of 28.3% [23] - The operating lease right-of-use assets increased to $28,871 million in March 2025, compared to $27,404 million in June 2024, reflecting a rise of 5.3% [23] Liabilities and Equity - Current liabilities rose to $173,991 million in March 2025, compared to $125,940 million in June 2024, an increase of 38.1% [23] - Total stockholders' equity increased to $346,613 million in March 2025, up from $322,613 million in June 2024, a growth of 7.4% [23] - Long-term debt decreased slightly to $5,765 million in March 2025 from $6,365 million in June 2024, a reduction of 9.4% [23] - Retained earnings increased to $207,968 million in March 2025, compared to $186,965 million in June 2024, an increase of 11.2% [23] Operational Insights - Sales volume in the consumer distribution channel decreased by 9.2%, driven by a 16.0% reduction in bars volume [5] - The commercial ingredients distribution channel saw an 8.3% decrease in sales volume, mainly due to competitive pricing pressures [7] - The company plans to invest approximately $90 million in equipment to expand domestic production capabilities by the end of fiscal 2026 [2] - The company is monitoring the impact of import tariffs on 15-20% of raw material purchases and is working with suppliers to manage cost increases [14] - Operating expenses decreased by $3.5 million to $90.1 million, driven by reductions in incentive compensation and advertising expenses [17]