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J & J Food Snacks: Resilient And Enduring Amidst The Pandemic

Mar. 02, 2021 9:08 AM ETJ&J Snack Foods Corp. (JJSF)1 Comment


  • J & J Food Snacks Corp. reported revenues recorded a 15% decrease over the first quarter of FY2020, but still an improvement compared to the 19% decline in the last quarter.
  • A 33% increase in sales from the Retail Supermarkets segment was not able to cover significant losses from their main contributor – the Food Service segment.
  • Net income suffered significantly with 90% contraction due to pandemic-induced sales pressure.
  • Long-term debt is paid off continuously which provides financing avenues for the company’s future endeavors in product innovation and/or acquisitions to maximize growth potential.
  • The pressure to prove that it is performing instead of an overvalued stock is in place as expectations are high for its growth in the following fiscal years.

Businesses are still struggling to return to their pre-pandemic operations, and this is still the case for J & J Snack Foods Corp. (NASDAQ: JJSF), a leading manufacturer of nutritional food snacks and frozen beverages distributor to the foodservice and retail supermarkets industry. The imposed lockdowns limiting human traffic brought about repercussions to the food industry through its ties to businesses that were severely affected by the pandemic. These lockdowns pushed some of the establishments selling food and beverages to operate in a reduced and limited capacity which impacted sales of manufacturers and distributors alike.

J & J Snack Food Corp.'s Performance

With two-thirds of their sales attributed to these foodservice venues, J & J Snack Food Corp.’s sales suffered significantly since the start of the pandemic and are continuing to do so despite their efforts to increase revenues from other avenues. The corporation reported a 15% decrease in sales for the first quarter of this fiscal year. Sales went down to $240.997 million from the $272.042 million of last year’s first quarter, as it remains challenged by the lingering impact of COVID-19 on consumers and customers. This was especially evident during the last Christmas season where establishments like these usually rely on the higher traffic to boost their sales up. Despite the decline, improvement can be seen with the 19% decrease in sales for the last quarter.

As mentioned, the food service segment is the largest contributor with 66% of the total quarterly sales followed by the Frozen Beverage segment with 17%, and the Retail Supermarket with 16%. Since the bulk of their revenue relies on the foodservice venues, the continued limited operation of key establishments like theme parks, schools, and theaters impacted the foodservice sales. Foodservice sales recorded a 13%.

Source: Macrotrends

The decrease compared to the last

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Comments (1)

Thank you for this nice assessment. I initiated a small position at 134$ while I thought it is expensive. And boy it is just going higher and higher. My model still says to avoid unless it falls back to 125$. The chicken bake is an interesting story, I will look into that more. I see from CEO: "And it’s the chicken bake, which is being sold in several hundred of the Costco side bar cafes on the outskirts of the store. And we have really high hopes for that. That could be as much as somewhere between $10 million and $25 million netting to us in sales.” The higher number being 5% 2019 net sales if I see this correctly. Not a huge deal right now but it can be a start of something greater.
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