It took a few years, but Jamba Juice parent Jamba
The smoothie chain posted better-than-expected results last night. Revenue fell 14% to $57.1 million, but that's part of the company's refranchising efforts. Jamba has spent the past two years handing over company-owned stores to franchisees, resulting in lower top-line results but a steadier flow of high-margin royalties. Jamba's net income clocked in at $4.1 million or $0.05 a share, reversing a small loss during last year's third quarter.
Analysts figured that Jamba would only earn $0.03 a share on $56.6 million in revenue. This is the first time since going public in 2005 that Jamba has scored back-to-back profitable quarters.
Investors can't get greedy. This is a seasonal business, and a quarterly deficit is likely for the current quarter as chilly weather makes a refreshing smoothie less tantalizing as a beverage option.
Same-store sales were up 3.3% at company-owned stores during the period, making it Jamba's fourth consecutive quarter of positive comps. Traffic itself was roughly flat. The gain here is a combination of a recent price hike and customers buying more non-smoothie items. Jamba's been trying to drum up ways to increase the attachment rate of its customers, adding a broader line of baked goods, oatmeal, flatbreads, and other items that are logical purchases alongside its signature blended treats. It has been successfully testing frozen yogurt at many of its California stores to beef up traffic later in the day, and plans to expand that offering next year.
International expansion is also moving along nicely. A Canadian partner opened its first store in Toronto last month, and its South Korean partner opened four more locations during the quarter. Jamba's also inking new retail licensing deals, taking advantage of its healthy active lifestyle brand in bottom line-padding agreements.
Jamba knows that it's not the only accessible smoothie chain out there. Starbucks
As the Jamba empire grows -- now at 762 stores and counting -- the beverage retailer is starting to become the active lifestyle brand that it always wanted to be. Year-round profitability should be its next granola-topped goal.
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