Exhibit 99.1

IMMEDIATE RELEASE FOR:      Contact: Dennis G. Moore Senior Vice President                Chief Financial Officer (856) 532-6603

  

6000 Central Highway

Pennsauken, NJ 08109

J & J SNACK FOODS

REPORTS THIRD QUARTER SALES

AND EARNINGS

Pennsauken, NJ, July 29, 2019 - J & J Snack Foods Corp. (NASDAQ-JJSF) today announced sales and earnings for the third quarter ended June 29, 2019.

Sales increased 7% to $326.7 million from $306.2 million in last year’s third quarter. Net earnings increased 18% to $30.9 million in the current quarter from $26.1 million last year. Earnings per diluted share increased 17% to $1.63 for the third quarter from $1.39 last year. Operating income increased 12% to $39.0 million in the current quarter from $34.9 million in the year ago quarter.

For the nine months ended June 29, 2019, sales increased 4% to $874.6 million from $837.5 million in last year’s nine months.  Net earnings decreased to $68.8 million in the nine months from $80.2 million last year. Earnings per diluted share decreased to $3.64 from $4.27 last year. Operating income increased 8% to $85.9 million this year from $79.6 million last year.

Net earnings for last year’s nine months benefitted from a $20.9 million, or $1.11 per diluted share, gain on the re-measurement of deferred tax liabilities and were impacted by a $1.2 million, or $.06 per diluted share, provision for the one-time repatriation tax, both of which resulted from the Tax Cuts and Jobs Act enacted in December 2017.   This year’s nine months benefitted by a reduction of approximately $900,000 in tax, or $.05 per diluted share, as the one-time repatriation tax was recorded on an estimated basis at December 30, 2017 and was revised downward in this year’s first quarter.     

Gerald B. Shreiber, J & J’s President and Chief Executive Officer, commented, “We are pleased to report improved performance and increased operating income across all of our business segments in this quarter. We continue to be focused on improving our margins and revenue going forward.”

J&J Snack Foods Corp. is a leader and innovator in the snack food industry, providing nutritional and affordable branded niche snack foods and beverages to foodservice and retail supermarket outlets.  Manufactured and distributed nationwide, our principal products include SUPERPRETZEL, BAVARIAN BAKERY and other soft pretzels, ICEE and SLUSH PUPPIE frozen beverages, LUIGI’S, MINUTE MAID* frozen juice bars and ices, WHOLE FRUIT sorbet and frozen fruit bars, MARY B’S biscuits and dumplings, DADDY RAY’S fig and fruit bars, TIO PEPE’S and CALIFORNIA CHURROS, THE FUNNEL CAKE FACTORY funnel cakes, and several bakery brands within COUNTRY HOME BAKERS and HILL & VALLEY. For more information, please visit http://www.jjsnack.com.

*MINUTE MAID is a registered trademark of The Coca-Cola Company

J & J SNACK FOODS CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF EARNINGS

(Unaudited)

(in thousands, except per share amounts)

	Three months ended					Nine months ended
	June 29,		June 30,			June 29,		June 30,
	2019		2018			2019		2018
Net Sales	$	326,701	$	306,239		$	874,615	$	837,550
Cost of goods sold		225,352		211,764			617,155		592,518
Gross Profit		101,349		94,475			257,460		245,032
Operating expenses
Marketing		26,398		25,589			69,792		69,672
Distribution		24,447		24,325			70,521		67,901
Administrative		10,668		9,654			29,909		28,014
Other general expense (income)		794		38			1,343		(193	)
Total operating expenses		62,307		59,606			171,565		165,394
Operating Income		39,042		34,869			85,895		79,638
Other income (expense)
Investment income		1,953		1,705			5,775		4,687
Interest expense & other		1,972		(209	)		1,920		267
Earnings before income taxes		42,967		36,365			93,590		84,592
Income taxes		12,095		10,236			24,838		4,381
NET EARNINGS	$	30,872	$	26,129		$	68,752	$	80,211
Earnings per diluted share	$	1.63	$	1.39		$	3.64	$	4.27
Weighted average number of diluted shares		18,947		18,822			18,912		18,801
Earnings per basic share	$	1.64	$	1.40		$	3.66	$	4.29
Weighted average number of basic shares		18,823		18,698			18,794		18,683

J & J SNACK FOODS CORP. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(in thousands, except share amounts)

	June 29,			September 29,
	2019			2018
	(unaudited)
Assets
Current assets
Cash and cash equivalents	$	156,097		$	111,479
Marketable securities held to maturity		40,809			21,048
Accounts receivable, net		146,553			132,342
Inventories		119,190			112,884
Prepaid expenses and other		4,146			5,044
Total current assets		466,795			382,797
Property, plant and equipment, at cost
Land		2,494			2,494
Buildings		26,582			26,582
Plant machinery and equipment		307,787			290,396
Marketing equipment		307,077			290,955
Transportation equipment		9,534			8,929
Office equipment		30,958			30,752
Improvements		39,761			38,941
Construction in progress		12,978			8,468
Total Property, plant and equipment, at cost		737,171			697,517
Less accumulated depreciation and amortization		486,519			454,844
Property, plant and equipment, net		250,652			242,673
Other assets
Goodwill		102,511			102,511
Other intangible assets, net		55,721			57,762
Marketable securities held to maturity		96,064			118,765
Marketable securities available for sale		21,032			24,743
Other		2,915			2,762
Total other assets		278,243			306,543
Total Assets	$	995,690		$	932,013
Liabilities and Stockholders' Equity
Current Liabilities
Current obligations under capital leases	$	330		$	324
Accounts payable		80,237			69,592
Accrued insurance liability		9,281			11,217
Accrued liabilities		14,098			8,031
Accrued compensation expense		17,177			20,297
Dividends payable		9,413			8,438
Total current liabilities		130,536			117,899
Long-term obligations under capital leases		714			753
Deferred income taxes		53,009			52,322
Other long-term liabilities		1,764			1,948
Stockholders' Equity
Preferred stock, $1 par value; authorized 10,000,000 shares; none issued		-			-
Common stock, no par value; authorized, 50,000,000 shares; issued and outstanding 18,830,000 and 18,754,000 respectively		37,840			27,340
Accumulated other comprehensive loss		(12,548	)		(11,994	)
Retained Earnings		784,375			743,745
Total stockholders' equity		809,667			759,091
Total Liabilities and Stockholders' Equity	$	995,690		$	932,013

J & J SNACK FOODS CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)     (in thousands)

	Nine months ended
	June 29,			June 30,
	2019			2018
Operating activities:
Net earnings	$	68,752		$	80,211
Adjustments to reconcile net earnings to net cash provided by operating activities:
Depreciation of property, plant and equipment		33,374			31,929
Amortization of intangibles and deferred costs		2,586			2,639
Share-based compensation		3,006			2,874
Deferred income taxes		690			(12,502	)
Loss on marketable securities		410			32
Other		350			(3	)
Changes in assets and liabilities net of effects from purchase of companies
Increase in accounts receivable		(14,289	)		(7,530	)
Increase in inventories		(6,257	)		(13,020	)
Decrease (increase) in prepaid expenses		957			(2,949	)
Increase in accounts payable and accrued liabilities		11,584			3,606
Net cash provided by operating activities	$	101,163			85,287
Investing activities:
Payment for purchases of companies, net of cash acquired		(1,155	)		-
Purchases of property, plant and equipment		(42,136	)		(43,344	)
Purchases of marketable securities		(24,056	)		(65,227	)
Proceeds from redemption and sales of marketable securities		29,721			51,417
Proceeds from disposal of property, plant and equipment		1,463			1,895
Other		(212	)		171
Net cash used in investing activities		(36,375	)		(55,088	)
Financing activities:
Payments to repurchase common stock		-			(2,794	)
Proceeds from issuance of stock		7,426			5,561
Payments on capitalized lease obligations		(33	)		(278	)
Payment of cash dividend		(27,230	)		(24,652	)
Net cash used in financing activities		(19,837	)		(22,163	)
Effect of exchange rate on cash and cash equivalents		(333	)		(3,370	)
Net increase in cash and cash equivalents	$	44,618		$	4,666
Cash and cash equivalents at beginning of period		111,479			90,962
Cash and cash equivalents at end of period	$	156,097		$	95,628

	Three months ended						Nine months ended
	June 29,			June 30,			June 29,			June 30,
	2019			2018			2019			2018
	(unaudited)
	(in thousands)
Sales to External Customers:
Food Service
Soft pretzels	$	55,867		$	53,880		$	154,670		$	151,649
Frozen juices and ices		13,862			12,825			30,336			29,448
Churros		18,888			16,739			49,793			46,603
Handhelds		8,550			9,974			25,339			30,667
Bakery		95,299			93,082			288,172			278,828
Other		6,105			5,201			19,576			16,235
Total Food Service	$	198,571		$	191,701		$	567,886		$	553,430
Retail Supermarket
Soft pretzels	$	7,294		$	7,332		$	28,309		$	27,925
Frozen juices and ices		26,515			28,785			52,179			53,950
Handhelds		3,063			2,960			8,110			8,749
Coupon redemption		(962	)		(1,278	)		(2,163	)		(2,647	)
Other		642			733			1,341			1,715
Total Retail Supermarket	$	36,552		$	38,532		$	87,776		$	89,692
Frozen Beverages
Beverages	$	56,937		$	49,132		$	121,976		$	115,401
Repair and maintenance service		22,514			19,693			62,291			58,005
Machines revenue		11,810			6,856			33,875			20,183
Other		317			326			811			839
Total Frozen Beverages	$	91,578		$	76,006		$	218,953		$	194,428
Consolidated Sales	$	326,701		$	306,239		$	874,615		$	837,550
Depreciation and Amortization:
Food Service	$	6,973		$	6,237		$	19,911		$	19,376
Retail Supermarket		335			332			990			980
Frozen Beverages		5,015			4,860			15,059			14,212
Total Depreciation and Amortization	$	12,323		$	11,429		$	35,960		$	34,568
Operating Income:
Food Service	$	21,154		$	19,663		$	59,195		$	54,098
Retail Supermarket		3,651			3,203			7,739			8,295
Frozen Beverages		14,237			12,003			18,961			17,245
Total Operating Income	$	39,042		$	34,869		$	85,895		$	79,638
Capital Expenditures:
Food Service	$	8,665		$	10,172		$	23,346		$	25,872
Retail Supermarket		597			273			1,730			376
Frozen Beverages		6,523			6,618			17,060			17,096
Total Capital Expenditures	$	15,785		$	17,063		$	42,136		$	43,344
Assets:
Food Service	$	752,117		$	672,861		$	752,117		$	672,861
Retail Supermarket		24,349			24,215			24,349			24,215
Frozen Beverages		219,224			217,156			219,224			217,156
Total Assets	$	995,690		$	914,232		$	995,690		$	914,232

RESULTS OF OPERATIONS

Net sales increased $20,462,000 or 7% to $326,701,000 for the three months and $37,065,000 or 4% to $874,615,000 for the nine months ended June 29, 2019 compared to the three and nine months ended June 30, 2018, respectively.

FOOD SERVICE

Sales to food service customers increased $6,870,000 or 4% in the third quarter to $198,571,000 and increased $14,456,000 or 3% to $567,886,000 for the nine months. Soft pretzel sales to the food service market increased 4% to $55,867,000 in the three months and 2% to $154,670,000 in the nine months due primarily to higher sales to convenience store chains. Two chains accounted for about 3/4 of the sales increase in the third quarter and about 1/2 of the increase in the nine months.

Frozen juices and ices sales increased 8% to $13,862,000 in the three months and 3% to $30,336,000 in the nine months as sales to warehouse club stores accounted for over 60% of the increase in the third quarter and all of the increase in the nine months.

   Churro sales to food service customers were up 13% in the quarter to $18,888,000 and up 7% to $49,793,000 in the nine months with strong sales to warehouse club stores and general increases and decreases across our customer base.

Sales of bakery products increased $2,217,000 or 2% to $95,299,000 in the third quarter and increased $9,344,000 or 3% to $288,172,000 for the nine months as sales were higher school foodservice and were up and down across our customer base.

Sales of handhelds decreased $1,424,000 or 14% in the quarter and $5,328,000 or 17% in the nine months with the decrease primarily coming from lower sales to co-pack customers because of unsuccessful product launches. Sales of funnel cake increased $522,000 or, 10%, to $5,616,000 in the quarter and $2,873,000, or 19%, to $18,308,000 in the nine months. The nine months sales increase was primarily sales to a quick service restaurant under a limited time offer program which ended in the second quarter.

Sales of new products in the first twelve months since their introduction were approximately $4 million in this quarter and $11 million in the nine months. Price increases were approximately $4 million for the quarter and $11 million for the nine months and net volume increases were approximately $3 million of sales in the quarter and in the nine months.

     Operating income in our Food Service segment increased from $19,663,000 to $21,154,000 in the quarter and increased from $54,098,000 to $59,195,000 in the nine months. For the quarter, operating income increased primarily because of increased volume, lower distribution expenses and increased pricing but was impacted by approximately $600,000 of costs related to prior years’ product recalls.  For the nine months, operating income improved primarily because of increased volume, price increases, lower marketing expenses and improved operations at several of our manufacturing facilities. Additionally, last year’s first quarter included shutdown costs of our Chambersburg, PA production facility. However, this year’s nine months, all in the first quarter, was impacted by approximately $900,000 of higher distribution expenses primarily due to higher freight rates which increased with the implementation of the electronic logging device mandate in January 2018. Additionally, lower sales of our MARY B’s biscuits and related costs due to our recall in January 2018 impacted our operating income by approximately $500,000 in last year’s first quarter.

RETAIL SUPERMARKETS

     Sales of products to retail supermarkets decreased $1,980,000 or 5% to $36,552,000 in the third quarter and decreased $1,916,000 or 2% to $87,776,000 for the nine months. Soft pretzel sales for the third quarter were down less than 1% to $7,294,000 and up 1% to $28,309,000 for the nine months. Sales of frozen juices and ices decreased $2,270,000 or 8% to $26,515,000 in the third quarter and decreased $1,771,000 or 3% in the nine months as we lost some volume and placements due to price increases. Handheld sales to retail supermarket customers increased 3% to $3,063,000 in the quarter and were down 7% to $8,110,000 in the nine months as the sales of this product line continue their long-term decline.

Sales of new products in the third quarter were approximately $200,000 and were approximately $1 million for the nine months. Price increases provided about $1.1 million of sales in the quarter and $2.0 million of sales in the nine months and net volume decreased by about $3.1 million for the quarter and $4.0 million for the nine months.

     Operating income in our Retail Supermarkets segment increased to $3,651,000 in this year’s third quarter from $3,203,000 in last year’s quarter, a 14% increase and decreased to $7,739,000 in this year’s nine months compared to $8,295,000 in last year’s nine months. For the quarter, operating income benefited from lower marketing and distribution costs and increased pricing.  For the nine months, increased product costs combined with lower volume were the primary drivers of the decrease in operating income.

FROZEN BEVERAGES

Frozen beverage and related product sales increased 20% to $91,578,000 in the third quarter and increased 13% to $218,953,000 in the nine months.  Beverage related sales were up 16% to $56,937,000 in the quarter due in large part to increased sales to one distributor of about $4 million and up 6% to $121,976,000 in the nine months.   The increased sales to this one distributor did not benefit operating income.  Sales to this distributor may continue to be higher into our fourth quarter. Gallon sales were up 2% for the three months.  Service revenue increased 14% to $22,514,000 in the third quarter and increased 7% to $62,291,000 in the nine months with sales increases and decreases spread throughout our customer base, but with significant increases in sales to two customers.

Machines revenue (primarily sales of frozen beverage machines) was $11,810,000, an increase of $4,954,000, in the quarter and $33,875,000, an increase of $13,692,000, in the nine months. Increases in sales to three customers accounted for the higher revenue in the quarter. Operating income in our Frozen Beverages segment increased to $14,237,000, or 19%, in this quarter and was up $1,716,000, or 10%, to $18,961,000 in the nine months primarily as a result of the increases in sales.

CONSOLIDATED

Gross profit as a percentage of sales was 31.02% in the third quarter and 30.85% last year.  Gross profit as a percentage of sales was 29.44% in the nine month period this year and 29.26% last year. Gross profit percentage for the quarter and nine months increased because of improved operations at several of our manufacturing facilities, price increases and because last year had the burden of shutting down our Chambersburg, PA production facility and moving its production to other facilities.

Total operating expenses increased $2,701,000 in the third quarter and as a percentage of sales decreased to 19.1% from 19.5% last year. For the nine months, operating expenses increased $6,171,000 and as a percentage of sales decreased to 19.6% from 19.7% last year. Marketing expenses decreased to 8.1% of sales in this year’s quarter from 8.4% last year and were 8.0% in the nine months compared to 8.3% of sales in last year’s nine months primarily because of controlled spending across all of our segments. Distribution expenses were 7.5% of sales in the third quarter and 7.9% of sales in last year’s quarter and were 8.1% in both year’s nine months. Distribution expenses as a percentage of sales were lower in the third quarter primarily because freight rates have dropped compared to last year. Administrative expenses were 3.3% of sales in the third quarter compared to 3.2% of sales last year in the third quarter and were 3.4% in this year’s nine months compared to 3.3% of sales in last year’s nine months. Other general operating expense in this year’s quarter includes $621,000 of costs related to prior years’ product recalls.

Operating income increased $4,173,000 or 12% to $39,042,000 in the three months and increased $6,257,000 or 8% to $85,895,000 the first nine months as a result of the aforementioned items.

Investment income increased by $248,000 and $1,088,000 in the third quarter and nine months, respectively, resulting from higher amounts invested and higher interest rates. Additionally, the third quarter and nine months were impacted by $118,000 and $385,000 of recognized unrealized losses.

     This year’s other income in the third quarter includes a $2.0 million payment received from a customer due to cancellation of production under a co-manufacturing agreement. Other income for last year’s nine months includes a $520,000 gain on a sale of property.

     Net earnings increased $4,743,000, or 18%, in the current three month period to $30,872,000 and were $68,752,000 for the nine month period this year compared to $80,211,000 for the nine month period last year.

     Net earnings for last year’s nine months benefited from a $20.9 million gain, or $1.11 per diluted share, on the remeasurement of deferred tax liabilities which was partially offset by a $1.2 million, or $.06 per diluted share, provision for the one time repatriation tax, both of which resulted from the Tax Cuts and Jobs Act enacted in December 2017. Excluding the deferred tax gain and the one time repatriation tax, our effective tax rate was 28.4% in last year’s nine months. Net earnings in this year’s nine months benefitted by a reduction of approximately $900,000 in tax as the provision for the one time repatriation tax was reduced as the amount recorded last year was an estimate.  Excluding the reduction in the provision for the one time repatriation tax, our effective tax rate was 27.5% in this year’s nine months. Our effective tax rate for the third quarter this year was 28.1% and 28.1% for last year’s third quarter, as this year benefitted from tax credits on returns filed this year and a lower federal tax rate.   

There are many factors which can impact our net earnings from year to year and in the long run, among which are the supply and cost of raw materials and labor, insurance costs, factors impacting sales as noted above, the continuing consolidation of our customers, our ability to manage our manufacturing, marketing and distribution activities, our ability to make and integrate acquisitions and changes in tax laws and interest rates.

The forward-looking statements contained herein are subject to certain risks and uncertainties that could cause actual results to differ materially from those projected in the forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect management’s analysis only as of the date hereof. The Company undertakes no obligation to publicly revise or update these forward-looking statements to reflect events or circumstances that arise after the date hereof.

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