EX-99.1 2 a06-10612_1ex99d1.htm EX-99

Exhibit 99.1

 

 

Poore Brothers Reports First Quarter 2006 Financial Results

 

GOODYEAR, Ariz. – April 27, 2006 – Poore Brothers, Inc. (Nasdaq: SNAK) today reported financial results for the first quarter ended April 1, 2006.

 

Net revenues for the first quarter of fiscal 2006 were $17.6 million, 6% above last year’s first quarter net revenues of $16.6 million. Net income was $0.1 million, or $0.00 per basic and diluted share, compared to net income of $0.2 million, or $0.01 per basic and diluted share last year. Net revenue growth was primarily attributable to T.G.I. Friday’s® snacks, Boulder Canyon Natural Foods™ snacks and Cinnabon® cookies, offset by a slight decline from Poore Brothers® snacks. The net income decline resulted from increased trade spending, stock option expensing and higher raw material costs offset by reduced selling, general and administrative costs and a $0.3 million pre-tax reversal of a fourth quarter 2005 Cinnabon® cookie unsaleable reserve.

 

Mr. Eric J. Kufel, Chief Executive Officer, commented, “We are in the midst of implementing significant changes throughout the Poore Brothers organization. Since the beginning of the year we have taken multiple actions to improve our operating capabilities and profitability. Specifically, we reduced trade spending from second half 2005 levels, executed price increases across nearly all company brands, implemented selling, general and administrative cost reductions, led trade spending and product development process improvements and streamlined and strengthened the management team.

 

“We are implementing a strategy that emphasizes profitable growth by leveraging existing brands and available manufacturing capacity. We intend to launch unique new products under the T.G.I. Friday’s®, Poore Brothers®, and Boulder Canyon Natural Foods™ brands, several of which are better-for-you snacks. The Company is also in development work on Panda Express® and Cinnabon® products, which we believe will result in a diverse pipeline of new snack food concepts that we intend to test in late 2006 and throughout 2007,” continued Mr. Kufel.

 

Recently, the Company began test marketing a Hispanic-targeted snack chip under a developmental license leveraging the Clamato® brand, a leading beverage amongst Hispanic consumers. This niche product is currently being tested in the vending channel.

 

Mr. Kufel concluded, “While pleased with the early progress of our initiatives to increase Poore Brothers profitability, we recognize meaningful growth in shareholder value will come from

 



 

building brands that generate consistent long-term revenue and profit growth. While we continue to seek acquisitions, our immediate focus is improving profitability by leveraging our existing family of Intensely Different™ brands, excess manufacturing capacity, strong balance sheet and an organization committed to improving shareholder value.”

 

About Poore Brothers, Inc.

With facilities in Indiana and Arizona, Poore Brothers is a marketer and manufacturer of Intensely Different™ snack foods under a variety of owned or licensed brand names, including T.G.I. Friday’s®, Cinnabon®, Tato Skins®, Poore Brothers®, Bob’s Texas Style®, and Boulder Canyon Natural Foods™. For further information about Poore Brothers or this release, please contact Eric Kufel, Chief Executive Officer, at (623) 932-6255, or logon to http://www.poorebrothers.com.

 

Statements contained in this press release that are not historical facts are forward looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. Because such statements include risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements. Factors that may cause actual results to differ from the forward-looking statements contained in this press release and that may affect the Company’s prospects in general include, but are not limited to, the potential need for additional financing, acquisition-related risks, significant competition, customer acceptance of new products, dependence upon major customers, dependence upon existing and future license agreements, general risks related to the food products industry, and such other factors as are described in the Company’s filings with the Securities and Exchange Commission.

 



 

POORE BROTHERS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

 

 

 

Quarter Ended

 

 

 

April 1,
2006

 

March 26,
2005

 

 

 

(unaudited)

 

(unaudited)

 

Net revenue

 

$

17,595,248

 

$

16,556,875

 

Cost of revenue

 

14,497,539

 

13,169,025

 

Gross profit

 

3,097,709

 

3,387,850

 

Selling, general & administrative expenses

 

3,016,343

 

3,047,797

 

Operating income

 

81,366

 

340,053

 

Interest income (expense), net

 

40,817

 

1,299

 

Income before income tax provision

 

122,183

 

341,352

 

Income tax provision

 

54,019

 

133,000

 

Net income

 

$

68,164

 

$

208,352

 

 

 

 

 

 

 

Earnings per common share:

 

 

 

 

 

Basic

 

$

0.00

 

$

0.01

 

Diluted

 

$

0.00

 

$

0.01

 

Weighted average number of common shares:

 

 

 

 

 

Basic

 

20,073,111

 

19,647,561

 

Diluted

 

20,097,237

 

19,854,440

 

 

POORE BROTHERS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

 

 

 

April 1,
2006

 

December 31,
2005

 

 

 

(unaudited)

 

(unaudited)

 

Current assets

 

$

21,002,542

 

$

21,411,795

 

Property and equipment, net

 

9,908,040

 

10,109,654

 

Other assets, net

 

10,280,661

 

10,282,120

 

Total assets

 

$

41,191,243

 

$

41,803,569

 

 

 

 

 

 

 

Current liabilities

 

$

6,757,235

 

$

7,522,523

 

Long-term debt

 

1,668,821

 

1,681,432

 

Other long-term liabilities

 

2,261,707

 

2,356,757

 

Total liabilities

 

10,687,763

 

11,560,712

 

Shareholders’ equity

 

30,503,480

 

30,242,857

 

Total liabilities and shareholders’ equity

 

$

41,191,243

 

$

41,803,569

 

 

POORE BROTHERS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

 

 

 

Quarter Ended

 

 

 

April 1,
2006

 

March 26,
2005

 

 

 

(unaudited)

 

(unaudited)

 

Net cash flows from operating activities

 

$

(187,575

)

$

1,216,110

 

Net cash flows from investing activities

 

(110,781

)

(183,700

)

Net cash flows from financing activities

 

(21,541

)

(233,611

)

Net increase (decrease) in cash

 

(319,897

)

798,799

 

Cash and cash equivalents at beginning of period

 

9,695,245

 

9,675,490

 

Cash and cash equivalents at end of period

 

$

9,375,348

 

$

10,474,289