Note 9

3 Months Ended

Dec. 26, 2020

Notes to Financial Statements

Segment Reporting Disclosure [Text Block]

Note 9 We principally sell our products to the food service and retail supermarket industries. Sales and results of our frozen beverages business are monitored separately from the balance of our food service business because of different distribution and capital requirements. We maintain separate and discrete financial information for the three operating segments mentioned above which is available to our Chief Operating Decision Makers.

Our three reportable segments are Food Service, Retail Supermarkets and Frozen Beverages. All inter-segment net sales and expenses have been eliminated in computing net sales and operating income. These segments are described below.

Food Service

The primary products sold by the food service group are soft pretzels, frozen juice treats and desserts, churros, dough enrobed handheld products and baked goods. Our customers in the food service industry include snack bars and food stands in chain, department and discount stores; malls and shopping centers; fast food outlets; stadiums and sports arenas; leisure and theme parks; convenience stores; movie theatres; warehouse club stores; schools, colleges and other institutions. Within the food service industry, our products are purchased by the consumer primarily for consumption at the point-of-sale.

Retail Supermarkets

The primary products sold to the retail supermarket channel are soft pretzel products – including SUPERPRETZEL, frozen juice treats and desserts including LUIGI’S Real Italian Ice, MINUTE MAID Juice Bars and Soft Frozen Lemonade, WHOLE FRUIT frozen fruit bars and sorbet, PHILLY SWIRL cups and sticks, ICEE Squeeze-Up Tubes and dough enrobed handheld products including PATIO burritos. Within the retail supermarket channel, our frozen and prepackaged products are purchased by the consumer for consumption at home.

Frozen Beverages

We sell frozen beverages and related products to the food service industry primarily under the names ICEE, SLUSH PUPPIE and PARROT ICE in the United States, Mexico and Canada. We also provide repair and maintenance service to customers for customers’ owned equipment.

The Chief Operating Decision Maker for Food Service and Retail Supermarkets and the Chief Operating Decision Maker for Frozen Beverages monthly review detailed operating income statements and sales reports in order to assess performance and allocate resources to each individual segment. Sales and operating income are key variables monitored by the Chief Operating Decision Makers and management when determining each segment’s and the company’s financial condition and operating performance. In addition, the Chief Operating Decision Makers review and evaluate depreciation, capital spending and assets of each segment on a quarterly basis to monitor cash flow and asset needs of each segment. Information regarding the operations in these three reportable segments is as follows:

	Three months ended
	December 26,			December 28,
	2020			2019
		(unaudited)
		(in thousands)
Sales to External Customers:
Food Service
Soft pretzels	$	32,687		$	49,941
Frozen juices and ices		6,295			7,043
Churros		11,542			16,391
Handhelds		17,611			7,189
Bakery		88,964			96,372
Other		3,326			6,512
Total Food Service	$	160,425		$	183,448
Retail Supermarket
Soft pretzels	$	13,888		$	9,826
Frozen juices and ices		15,316			10,093
Biscuits		7,660			6,978
Handhelds		2,780			2,761
Coupon redemption		(1,075	)		(543	)
Other		525			311
Total Retail Supermarket	$	39,094		$	29,426
Frozen Beverages
Beverages	$	15,855		$	35,255
Repair and maintenance service		18,896			22,486
Machines revenue		6,489			11,981
Other		238			301
Total Frozen Beverages	$	41,478		$	70,023
Consolidated Sales	$	240,997		$	282,897
Depreciation and Amortization:
Food Service	$	6,786		$	6,918
Retail Supermarket		386			359
Frozen Beverages		5,776			5,453
Total Depreciation and Amortization	$	12,948		$	12,730
Operating Income :
Food Service	$	6,180		$	18,034
Retail Supermarket		4,723			2,217
Frozen Beverages		(10,325	)		1,452
Total Operating Income	$	578		$	21,703
Capital Expenditures:
Food Service	$	8,286		$	8,403
Retail Supermarket		21			960
Frozen Beverages		1,369			8,242
Total Capital Expenditures	$	9,676		$	17,605
Assets:
Food Service	$	744,277		$	760,852
Retail Supermarket		31,668			30,963
Frozen Beverages		275,898			304,291
Total Assets	$	1,051,843		$	1,096,106