J & J Snack Foods Corp. has reported a 4.1% increase in net sales for the first quarter of fiscal 2025, reaching $362.6 million. However, the gross profit decreased by 0.7% to $93.9 million. Operating income also saw a decline of 35.6% to $6.2 million, while net earnings dropped by 29.4% to $5.1 million. Adjusted operating income decreased by 39.7% to $8.2 million, and adjusted EBITDA fell by 16.3% to $25.3 million.
The company's earnings per diluted share also experienced a decline of 29.7% to $0.26, while the adjusted earnings per diluted share dropped by 36.5% to $0.33.
Despite the challenges faced in the first quarter, J & J Snack Foods Corp. remains confident in its ability to address short-term margin pressures and improve profitability in the coming quarters through incremental pricing actions and driving efficiencies across its supply chain.
The Board of Directors has also approved a new $50 million stock repurchase authorization, reflecting the company's confidence in its long-term value and strong balance sheet. This authorization is effective for two years and demonstrates the company's commitment to driving shareholder returns.
In terms of segment performance, the food services, retail supermarket, and frozen beverages segments all experienced sales growth compared to the prior year quarter. However, gross profit as a percentage of sales decreased to 25.9% in the first quarter of fiscal 2025 from 27.2% in the same period of the previous year.
The company's total operating expenses represented 24.2% of sales for the quarter, slightly lower than the 24.4% in the first quarter of fiscal 2024. Operating income was $6.2 million, down from $9.7 million in the prior year period, leading to net earnings of $5.1 million compared to $7.3 million in the same quarter of fiscal 2024.
J & J Snack Foods Corp. remains optimistic about the market catalysts in fiscal 2025, particularly in movie theaters, where its customers are expected to benefit from a stronger film slate. The company's diversified product portfolio and long-term strategy position it well for sustained growth.
The first quarter results indicate that while J & J Snack Foods Corp. faced challenges in certain segments, it remains focused on addressing these issues and leveraging opportunities for growth in the coming quarters. The market has reacted to these announcements by moving the company's shares -3.3% to a price of $132.7. If you want to know more, read the company's complete 8-K report here.
