Jamba Comes Bearing Gift Baskets of Fruit

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Jamba (NASDAQ: JMBA  ) is blending along just fine.

The parent company of the 829-unit Jamba Juice smoothie chain posted modest growth after Monday's market close.

Revenue climbed 2% to $67.3 million, fueled primarily by a 1.7% increase in systemwide comps. Earnings after dividends rose to $0.36 a share from $0.27 a share a year earlier. As for reporting profitability after dividends, that distinction is about to become moot. Jamba doesn't pay dividends on its common stock, and in June it converted its payout-producing preferred shares to common stock.

Jamba's results fell short of Wall Street expectations of a profit of $0.37 a share on $70.4 million in revenue, but the shares still initially moved higher after Jamba reiterated its ambitious guidance for all of 2013.

Jamba still expects company-owned stores posting 4% to 6% comps growth and 20% in store-level margin. It sees operating profit margin clocking in at 2.5% to 3% for the year. Jamba is still on track to add 60 to 80 locations -- largely franchise-operated stores -- in 2013, and that doesn't include the smaller JambaGO institutional kiosks, for which the goal remains an ambitious 1,000 installations.

Growth outside of its stores still hasn't moved the needle, and Jamba sees no more than $5 million in consumer packaged goods sales this year. Things are starting to happen for Jamba's packaged smoothie and energy drink products, as Jamba singled out Rite-Aid, Wal-Mart, and Safeway as recent wins at the retail level.

Despite the aggressive expansion of smoothies at Starbucks (NASDAQ: SBUX  ) and McDonald's (NYSE: MCD  ) , Jamba continues to keep inching in the right direction. Systemwide comps have now risen every quarter over the past two years.

Jamba was asked if the success that Starbucks has had with its iced Refreshers line of beverages has eaten into its own sales, but the company dismissed the notion. If anything, Jamba is moving to Starbucks' turf by expanding its juice offerings beyond its signature smoothies. Either way, Jamba's steady increase in comps proves that it's been immune to Starbucks offering up more cool drinks and McDonald's aggressively promoting its McCafe smoothie beverages.

The outlook for the balance of 2013 is upbeat. Jamba targeting 4% to 6% in comps growth in 2013 becomes even more ambitious when you consider that comps through the first half of the year only clocked in with a 2.8% gain.

Then again, given the hot nature of how this summer has gone and the seasonal spike that Jamba experiences when weather heats up, it probably shouldn't be a shock to be reminded that the best is still in fact yet to come.

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Related Tickers

9/26/2016 2:45 PM
JMBA $10.47 Down -0.05 -0.48%
Jamba CAPS Rating: **
MCD $116.59 Down -0.58 -0.50%
McDonald's CAPS Rating: ***
SBUX $54.17 Down -0.26 -0.48%
Starbucks CAPS Rating: ****