YOCREAM International Operating Income Up 27%, Net Income Up 13.8% In Third Quarter
PORTLAND, Ore., Sep 12, 2000 /PRNewswire via COMTEX/ -- YOCREAM International, Inc. (Nasdaq:YOCM), a manufacturer and wholesaler of frozen desserts and smoothies, today reported that for the quarter ended July 31, 2000, sales, operating income, and net income were up over the same period in 1999.
Sales for the third quarter were $4.7 million, a 1.9% increase compared to sales of $4.6 million in the same 1999 quarter. Operating income increased 27.1% to $713,000 compared to $561,000, due to higher sales, continued improvement in gross margins, and lower expenses. The gross margin in the current quarter was 32.7% compared with 31.7% in the same 1999 quarter. The margin improved over the same period last year due to increased efficiencies, implementation of supply chain management practices, and lower operating expenses. Reductions in selling, general and administrative expenses also contributed to the improved results for the quarter. Net income increased 13.8% to $449,000, or $.20 per share, compared to $395,000, or $.17 per share for last year. Current period earnings were affected by an increase in the effective tax rate to 37.4% compared with 28% a year ago. The effective tax rate a year ago was less than normal due to recognizing the remaining net operating loss carryforward benefit from prior years.
"The rate of sales growth was higher a year ago because a couple of major customers were involved at that time in a significant product ramp up in their operations," said Douglas Caudell, Chief Financial Officer of YOCREAM International. "We have recently completed testing and began rollout of another new smoothie product which is expected to make a significant contribution to near future sales and operating results."
"We are currently reconfiguring and upgrading our production facilities which is expected to more than double production capacity when completed by December of this year," said Caudell. "These steps are being taken because we anticipate a continued positive growth curve."
For the nine months, sales of $11.3 million increased 8.3% from $10.4 million, and net income increased 1.3% to $762,000, or $.33 per share. For the comparable 1999 nine months net income was $753,000, or $.32 per share. A slight improvement in gross margins to 32%, and holding the line on selling and administrative expenses resulted in increasing pre-tax income for the current nine-month period by 17.2%. Most of these gains in the current year were offset by the higher effective income tax rate, resulting in an increase in net income of 1.3%. Cash flow, as measured by EBITDA, for the first three quarters of 2000 totaled $1.5 million compared to $1.36 million for the same year-to-date period. Caudell also pointed out that, "YOCREAM's cash and equivalents have increased to $1.1 million, and book value at July 31, 2000 is $2.56 per share."
YOCREAM International, Inc. makes, markets and sells frozen desserts, snacks and smoothies throughout the United States and in several foreign countries. It sells primarily to food distributors and wholesales clubs; and the company's products are available in restaurants, convenience stores, schools, hospitals, corporate cafeterias and wholesale clubs.
This release may contain certain forward-looking statements, which are based on management's current expectations. Factors that could cause future results to vary materially from these expectations include, but are not limited to, change in distribution abilities, level of customer acceptance of new products, change in co-packing relationships and strategic alliances and other economic, competitive, governmental, regulatory and factors affecting the company's operations, pricing, products and service. For a more complete discussion of the risks associated with forward-looking information, refer to the Risk Factors contained in the company's Form 10-K filed with the Securities and Exchange Commission on January 28, 2000.
YOCREAM INTERNATIONAL, INC. Income Statement Summary (Unaudited) Three Months Ended Nine Months Ended July 31, July 31, 2000 1999 2000 1999 Sales $4,714,158 $4,625,638 $11,288,898 $10,424,730 Cost of sales 3,171,555 3,157,236 7,677,063 7,116,196 Gross profit 1,542,603 1,468,402 3,611,835 3,308,534 Selling, general and administrative expenses 829,376 907,177 2,384,702 2,204,727 Income from operations 713,227 561,225 1,227,133 1,103,807 Other income (expenses) 4,130 (13,111) (1,636) (58,028) Income before taxes 717,357 548,114 1,225,497 1,045,779 Income tax provision 268,100 153,200 463,200 293,200 Net income $449,257 $394,914 $762,297 $752,579 Earnings per common share Basic $0.20 $0.17 $0.33 $0.32 Diluted $0.20 $0.17 $0.33 $0.32 Shares used in per share calculation Basic 2,279,654 2,312,585 2,288,968 2,316,614 Diluted 2,296,297 2,367,678 2,313,371 2,374,965SOURCE YOCREAM International, Inc.
For more information, contact Terry Lusetti, YoCream Investor Relations, 503-256-3754