Poore Brothers, Inc. (Nasdaq: SNAK) today reported financial
results for the first quarter ended April 1, 2006. Net revenues for
the first quarter of fiscal 2006 were $17.6 million, 6% above last
year's first quarter net revenues of $16.6 million. Net income was
$0.1 million, or $0.00 per basic and diluted share, compared to net
income of $0.2 million, or $0.01 per basic and diluted share last
year. Net revenue growth was primarily attributable to T.G.I.
Friday's(R) snacks, Boulder Canyon Natural Foods(TM) snacks and
Cinnabon(R) cookies, offset by a slight decline from Poore
Brothers(R) snacks. The net income decline resulted from increased
trade spending, stock option expensing and higher raw material
costs offset by reduced selling, general and administrative costs
and a $0.3 million pre-tax reversal of a fourth quarter 2005
Cinnabon(R) cookie unsaleable reserve. Mr. Eric J. Kufel, Chief
Executive Officer, commented, "We are in the midst of implementing
significant changes throughout the Poore Brothers organization.
Since the beginning of the year we have taken multiple actions to
improve our operating capabilities and profitability. Specifically,
we reduced trade spending from second half 2005 levels, executed
price increases across nearly all company brands, implemented
selling, general and administrative cost reductions, led trade
spending and product development process improvements and
streamlined and strengthened the management team. "We are
implementing a strategy that emphasizes profitable growth by
leveraging existing brands and available manufacturing capacity. We
intend to launch unique new products under the T.G.I. Friday's(R),
Poore Brothers(R), and Boulder Canyon Natural Foods(TM) brands,
several of which are better-for-you snacks. The Company is also in
development work on Panda Express(R) and Cinnabon(R) products,
which we believe will result in a diverse pipeline of new snack
food concepts that we intend to test in late 2006 and throughout
2007," continued Mr. Kufel. Recently, the Company began test
marketing a Hispanic-targeted snack chip under a developmental
license leveraging the Clamato(R) brand, a leading beverage amongst
Hispanic consumers. This niche product is currently being tested in
the vending channel. Mr. Kufel concluded, "While pleased with the
early progress of our initiatives to increase Poore Brothers
profitability, we recognize meaningful growth in shareholder value
will come from building brands that generate consistent long-term
revenue and profit growth. While we continue to seek acquisitions,
our immediate focus is improving profitability by leveraging our
existing family of Intensely Different(TM) brands, excess
manufacturing capacity, strong balance sheet and an organization
committed to improving shareholder value." About Poore Brothers,
Inc. With facilities in Indiana and Arizona, Poore Brothers is a
marketer and manufacturer of Intensely Different(TM) snack foods
under a variety of owned or licensed brand names, including T.G.I.
Friday's(R), Cinnabon(R), Tato Skins(R), Poore Brothers(R), Bob's
Texas Style(R), and Boulder Canyon Natural Foods(TM). For further
information about Poore Brothers or this release, please contact
Eric Kufel, Chief Executive Officer, at (623) 932-6255, or logon to
http://www.poorebrothers.com. Statements contained in this press
release that are not historical facts are forward-looking
statements as that term is defined in the Private Securities
Litigation Reform Act of 1995. Because such statements include
risks and uncertainties, actual results may differ materially from
those expressed or implied by such forward-looking statements.
Factors that may cause actual results to differ from the
forward-looking statements contained in this press release and that
may affect the Company's prospects in general include, but are not
limited to, the potential need for additional financing,
acquisition-related risks, significant competition, customer
acceptance of new products, dependence upon major customers,
dependence upon existing and future license agreements, general
risks related to the food products industry, and such other factors
as are described in the Company's filings with the Securities and
Exchange Commission. -0- *T POORE BROTHERS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME Quarter Ended
------------------------- April 1, March 26, 2006 2005 ------------
------------ (unaudited) (unaudited) Net revenue $17,595,248
$16,556,875 Cost of revenue 14,497,539 13,169,025 ------------
------------ Gross profit 3,097,709 3,387,850 Selling, general
& administrative expenses 3,016,343 3,047,797 ------------
------------ Operating income 81,366 340,053 Interest income
(expense), net 40,817 1,299 ------------ ------------ Income before
income tax provision 122,183 341,352 Income tax provision 54,019
133,000 ------------ ------------ Net income $ 68,164 $ 208,352
============ ============ Earnings per common share:
-------------------------- Basic $ 0.00 $ 0.01 ============
============ Diluted $ 0.00 $ 0.01 ============ ============
Weighted average number of common shares:
----------------------------------------- Basic 20,073,111
19,647,561 ============ ============ Diluted 20,097,237 19,854,440
============ ============ *T -0- *T POORE BROTHERS, INC. AND
SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS April 1,
December 31, 2006 2005 ------------ ------------ (unaudited)
(unaudited) Current assets $21,002,542 $21,411,795 Property and
equipment, net 9,908,040 10,109,654 Other assets, net 10,280,661
10,282,120 ------------ ------------ Total assets $41,191,243
$41,803,569 ============ ============ Current liabilities $
6,757,235 $ 7,522,523 Long-term debt 1,668,821 1,681,432 Other
long-term liabilities 2,261,707 2,356,757 ------------ ------------
Total liabilities 10,687,763 11,560,712 Shareholders' equity
30,503,480 30,242,857 ------------ ------------ Total liabilities
and shareholders' equity $41,191,243 $41,803,569 ============
============ *T -0- *T POORE BROTHERS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS Quarter Ended
------------------------ April 1, March 26, 2006 2005 -----------
------------ (unaudited) (unaudited) Net cash flows from operating
activities $ (187,575) $ 1,216,110 Net cash flows from investing
activities (110,781) (183,700) Net cash flows from financing
activities (21,541) (233,611) ----------- ------------ Net increase
(decrease) in cash (319,897) 798,799 Cash and cash equivalents at
beginning of period 9,695,245 9,675,490 ----------- ------------
Cash and cash equivalents at end of period $9,375,348 $10,474,289
=========== ============ *T
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