John B. Sanfilippo & Son(US:JBSS)2021-10-27 20:03Financial Performance - Net sales for the first quarter of fiscal 2022 increased by 7.6% to $226.3 million compared to $210.3 million in the first quarter of fiscal 2021[84]. - Sales volume, measured as pounds sold, increased by 14.0% in the first quarter of fiscal 2022 compared to the same period in fiscal 2021[86]. - Gross profit increased by $12.4 million, or 31.7%, to $51.8 million, with a gross profit margin of 22.9% for the first quarter of fiscal 2022, up from 18.7% in the prior year[98]. - Income from operations increased to $27.3 million, representing 12.1% of net sales, compared to $18.9 million, or 9.0% of net sales, in the first quarter of fiscal 2021[103]. - Net income for the first quarter of fiscal 2022 was $19.2 million, or $1.67 per common share basic, compared to $12.8 million, or $1.12 per common share basic, for the same period in fiscal 2021, representing a 50% increase in net income[108]. Operating Expenses - Total operating expenses rose by $4.0 million, or 19.6%, to $24.5 million, increasing as a percentage of net sales from 9.7% to 10.8%[87]. - Selling expenses for the first quarter of fiscal 2022 were $17.7 million, an increase of $5.7 million, or 46.8%, from the first quarter of fiscal 2021[100]. Inventory and Cash Flow - Operating cash flow decreased to $0.9 million in the first quarter of fiscal 2022 from $20.6 million in the same period of fiscal 2021, primarily due to increased working capital for inventory[112]. - Total inventories increased by $4.6 million, or 3.1%, to $152.6 million at September 23, 2021, compared to the previous quarter, driven by higher quantities of almonds and ingredients[113]. Investment and Financing Activities - Cash used in investing activities was $1.2 million in the first quarter of fiscal 2022, a decrease from $6.0 million in the same period last year, due to net proceeds from property dispositions[115]. - Cash provided by financing activities was $0.2 million in the first quarter of fiscal 2022, compared to a cash outflow of $15.4 million in the same period last year, with net short-term borrowings increasing to $36.6 million[116]. Future Outlook and Strategies - The company expects acquisition costs for dried fruit and major tree nuts to increase in the 2021 crop year, impacting future financial results[89]. - The company plans to increase promotional and advertising activity to drive growth across key categories, focusing on e-commerce and new consumer engagement strategies[77]. - The company expects total capital expenditures for fiscal 2022 to be approximately $18.0 million, focusing on new equipment and facility upgrades[115]. - The company anticipates that net cash flow generated from operations will be sufficient to fund operations for the next twelve months[110]. - The company is exploring growth strategies outlined in its Strategic Plan, including expanding branded and private label nut programs[110]. Compliance and Credit Facilities - The weighted average interest rate for the Credit Facility was 2.1% as of September 23, 2021, with $68.0 million of available credit under the facility[122]. - The company has been in compliance with all covenants under its Credit Facility and Mortgage Facility as of September 23, 2021[123].