EX-99.1 2 v037868_ex99-1.htm
FOR IMMEDIATE RELEASE
Contact: Andrew Gordon, President & CEO
Telephone: (718) 832-0800

Coffee Holding Co., Inc. Reports First Quarter Earnings

BROOKLYN, New York - March 15, 2006. Coffee Holding Co., Inc. (AMEX:JVA) today announced its operating results for the first quarter ended January 31, 2006. In this release, the Company:

Ÿ   Reports sales growth of 71.8% for the quarter;

Ÿ   Announces an increase in net income of 29.2% for the quarter; and

Ÿ   Reports net income of $0.09 per share for the quarter.

Net income increased $117,000, or 29.2%, to $520,000 or $0.09 per share, for the quarter ended January 31, 2006 compared to $402,000, or $0.10 per share, for the quarter ended January 31, 2005. The increase in net income reflects an increase in net sales, partially offset by an increase in cost of sales. Net sales increased by $5.8 million, or 71.8%, to $13.8 million for the quarter compared to $8.1 million for the quarter ended January 31, 2005. The increase in net sales primarily reflects increased sales of green coffee.

The decrease in earnings per share for the quarter ended January 31, 2006 compared to the quarter ended January 31, 2005 was attributable to the Company’s initial public offering in May 2005. During the three months ended January 31, 2006, there were 1,620,000, or 40.5%, more shares of common stock outstanding than during the three months ended January 31, 2005. If the number of outstanding shares of common stock had remained constant, the Company’s basic and diluted earnings per share would have been $.13 per share for the quarter.

“We are pleased with the results for the quarter. We continue to show strength on our revenue line and our operations have remained profitable during a period of extreme volatility in the coffee market (prices). More importantly, we experienced expansion in all three core segments of our business as our green coffee sales and roasted product sales were substantially higher year over year,” said Andrew Gordon, President and Chief Executive Officer.

About Coffee Holding

Coffee Holding is a leading integrated wholesale coffee roaster and dealer in the United States and one of the few coffee companies that offers a broad array of coffee products across the entire spectrum of consumer tastes, preferences and price points. Coffee Holding has been a family operated business for three generations and has remained profitable through varying cycles in the coffee industry and the economy. The Company's private label and branded coffee products are sold through the United States, Canada and abroad to supermarkets, wholesalers, and individually owned and multi unit retail customers.

Any statements that are not historical facts contained in this release are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. It is possible that the assumptions made by management for purposes of such statements may not materialize. Actual results may differ materially from those projected or implied in any forward-looking statements. Such statements may involve risks and uncertainties, including but not limited to those relating to product demand, pricing, market acceptance, the effect of economic conditions, intellectual property rights, the outcome of competitive products, risks in product development, the results of financing efforts, the ability to complete transactions, and other factors discussed from time to time in the Company’s Securities and Exchange Commission filings. The Company undertakes no obligation to update or revise any forward-looking statement for events or circumstances after the date on which such statement is made.
 
 
 
 
 
COFFEE HOLDING CO., INC.
CONDENSED BALANCE SHEETS
JANUARY 31, 2006 AND OCTOBER 31, 2005

   
January 31,
2006
  
October 31,
2005
  
   
(unaudited)
      
- ASSETS -
  
CURRENT ASSETS:
          
Cash
  
$
1,845,600
  
$
735,468
  
Due from broker
    
2,672,863
    
2,994,394
  
Accounts receivable, net of allowance for doubtful accounts of $420,349 for 2006 and 2005
    
4,404,636
    
5,159,576
  
Inventories
    
3,456,891
    
4,496,578
  
Prepaid expenses and other current assets
    
314,923
    
284,170
  
Deferred tax asset
    
269,600
    
318,600
  
TOTAL CURRENT ASSETS
    
12,964,513
    
13,988,786
  
               
Property and equipment, at cost, net of accumulated depreciation of $3,840,341 and $3,727,524 for 2006 and 2005, respectively
    
2,341,331
    
2,379,952
  
Deposits and other assets
    
210,556
    
176,575
  
TOTAL ASSETS
  
$
15,516,400
  
$
16,545,313
  
               
- LIABILITIES AND STOCKHOLDERS' EQUITY -
CURRENT LIABILITIES:
              
Accounts payable and accrued expenses
  
$
3,392,866
  
$
4,431,577
  
Current portion of obligations under capital lease
    
-
   
1,329
  
Line of credit borrowings
    
471,125
    
1,063,167
  
Income taxes payable - current
    
288,114
    
218,864
  
TOTAL CURRENT LIABILITIES
    
4,152,105
    
5,714,937
  
               
Income taxes payable - deferred
    
34,000
    
53,700
  
Deferred compensation payable
    
169,035
    
135,054
  
TOTAL LIABILITIES
    
4,355,140
    
5,903,691
  
               
COMMITMENTS AND CONTINGENCIES
              
               
STOCKHOLDERS' EQUITY:
             
Preferred stock, par value $.001 per share; 10,000,000 shares authorized; none issued
    
-
   
-
 
Common stock, par value $.001 per share; 30,000,000 shares authorized, 5,529,830 shares issued and outstanding for 2006 and 2005
    
5,530
    
5,530
  
Additional paid-in capital
    
7,327,023
    
7,327,023
  
Retained earnings
    
3,828,707
    
3,309,069
  
TOTAL STOCKHOLDERS' EQUITY
   
11,161,260
    
10,641,622
  
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY
  
$
15,516,400
  
$
16,545,313
  
 
 
 
 
 
 
COFFEE HOLDING CO., INC.
CONDENSED STATEMENTS OF INCOME
THREE MONTHS ENDED JANUARY 31, 2006 AND 2005
(Unaudited)

       
   
2006
  
2005
  
NET SALES
  
$
13,844,845
  
$
8,060,280
  
               
COST OF SALES
    
11,519,402
    
5,988,013
  
               
GROSS PROFIT
    
2,325,443
    
2,072,267
  
               
OPERATING EXPENSES:
              
Selling and administrative
    
1,282,837
    
1,268,065
  
Officers' salaries
    
135,975
    
127,321
  
TOTALS
    
1,418,812
    
1,395,386
  
               
INCOME FROM OPERATIONS
    
906,631
    
676,881
  
               
OTHER INCOME (EXPENSE)
              
Interest income
    
30,566
    
3,270
  
Interest expense
    
(15,459
)
  
(26,470
)
     
15,107
    
(23,200
)
               
INCOME BEFORE INCOME TAXES
    
921,738
    
653,681
  
               
Provision for income taxes
    
402,100
    
251,400
  
               
NET INCOME
  
$
519,638
  
$
402,281
  
               
Basic and diluted earnings per share
  
$
.09
  
$
.10
  
               
Weighted average common shares outstanding:
              
Basic
    
5,529,830
    
3,999,650
  
Diluted
    
5,593,250
    
3,999,650
  


 
 
 

COFFEE HOLDING CO., INC.
CONDENSED STATEMENTS OF CASH FLOWS
THREE MONTHS ENDED JANUARY 31, 2006 AND 2005
(Unaudited)

   
2006
  
2005
  
OPERATING ACTIVITIES:
          
Net income
  
$
519,638
  
$
402,281
  
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
              
Depreciation and amortization
    
112,817
    
105,000
  
Deferred taxes
    
29,300
    
(40,600
)
Changes in operating assets and liabilities:
              
Due from broker
    
321,531
    
(66,251
)
Accounts receivable
    
754,940
    
924,301
  
Inventories
    
1,039,687
    
(728,721
)
Prepaid expenses and other assets
    
(64,734
)
  
26,982
  
Accounts payable and accrued expenses
    
(1,038,711
)
  
(1,576,078
)
Deferred compensation payable
    
33,981
    
-
 
Income taxes payable
    
69,250
    
35,500
  
Net cash provided by (used in) operating activities
    
1,777,699
    
(917,586
)
               
INVESTING ACTIVITIES:
              
Purchases of property and equipment
    
(74,196
)
  
(14,402
)
Deposits and other assets
    
-
   
(8,025
)
Net cash (used in) investing activities
    
(74,196
)
  
(22,427
)
               
FINANCING ACTIVITIES:
              
Principal payments on term loan
    
-
   
(252,000
)
Advances under bank line of credit
    
10,317,070
    
3,480,045
  
Principal payments under bank line of credit
    
(10,909,112
)
  
(2,685,045
)
Principal payments of obligations under capital leases
    
(1,329
)
  
(38,657
)
Net cash (used in) provided by financing activities
    
(593,371
)
  
504,343
  
               
               
NET INCREASE (DECREASE) IN CASH
    
1,110,132
    
(435,670
)
               
Cash, beginning of year
    
735,468
    
642,145
  
               
CASH, END OF PERIOD
  
$
1,845,600
  
$
206,475
  
               
SUPPLEMENTAL DISCLOSURE OF CASH FLOW DATA:
              
Interest paid
  
$
13,176
  
$
32,366
  
Income taxes paid
  
$
299,321
  
$
256,500