Jamba reports Q1 net loss of US$1.5M, compared with net loss of US$6.5M in year-ago period; revenue down 20% to US$53M

EMERYVILLE, California , May 7, 2012 (press release) – Jamba, Inc. (NASDAQ:JMBA) today reported unaudited financial results for the first fiscal quarter ended April 3, 2012. The Company recorded a quarterly comparable company-store sales increase of 12.7%, the sixth consecutive quarter of company-owned store sales growth, driven by a significant increase in store traffic and average check.

Jamba also recorded solid increases in store-level operating margin and royalty revenue from its expanding consumer products platform. During the quarter, 10 new stores were opened; four stores in North America and six in Asia. The Company also introduced three new juice blends to its squeezed-to-order fresh juice offerings, the Fit ‘N Fruitful meal replacement smoothie platform, and completed the acquisition of the premium tea company, Talbott Teas.

Highlights for the 13 weeks ended April 3, 2012, compared to the 16 weeks ended April 19, 2011:

This is the first quarter the Company’s results are being reported on the basis of four 13 week fiscal quarters which results in 12 fiscal periods. This means that the fiscal 2012 quarterly results are not directly comparable to fiscal 2011 quarterly results. Fiscal 2012 first quarter began on January 4, 2012 and ended on April 3, 2012. The Company has provided proforma results for fiscal 2011 first quarter with a reconciliation to the fiscal 2011 first quarter, as reported, in the attached tables. The first quarter of fiscal 2012 had 13 weeks and the first quarter of fiscal 2011 had 16 weeks.

* Company-owned comparable store sales(1) increased 12.7% for the quarter as compared to the prior year period, reflecting the Company’s sixth consecutive quarter of comparable store sales growth.
* System-wide comparable store sales(1) increased 11.6% and franchise-operated comparable store sales(1) increased 10.5% for the quarter.
* Net loss was $(1.5) million, or $(0.03) diluted loss per share for the quarter, compared to net loss of $(6.5) million or $(0.11) diluted loss per share for the prior year period.
* As a result of the 13 week quarter ended April 3, 2012 compared to the prior year’s 16 week quarter ended April 19, 2011 and the reduced number of stores, total revenue decreased 19.8% to $53.0 million.
* Due to three fewer weeks in the quarter ended April 3, 2012, general and administrative expenses decreased 17.3% to $8.6 million from $10.4 million for the prior year period.
* During the quarter, franchisees opened 10 new stores globally; four new franchise stores in the U.S., and six new international stores.
* Three new juice blends were added, doubling Jamba’s line of fresh-squeezed all-natural juices.
* Jamba expanded its position as a health and wellness brand with the acquisition of Talbott Teas, a Chicago-based boutique premium tea company that sells its products on-line, in specialty stores, gourmet grocers, salon spas, luxury hotels and Chicagoland restaurants.

Highlights for the 13 weeks ended April 3, 2012, compared to the proforma 13 weeks ended March 29, 2011:

* Total revenue for the 13 weeks ended April 3, 2012 was $53.0 million. Non-GAAP proforma total revenue for the 13 weeks ended March 29, 2011 was $50.6 million.
* General and administrative expenses for the 13 weeks ended April 3, 2012 increased 2.8% to $8.6 million from $8.4 million for non-GAAP proforma general and administrative expenses for the 13 weeks ended March 29, 2011.
* The attached tables include non-GAAP proforma results for the 13 weeks ended March 29, 2011.

“Jamba experienced a strong first quarter with gains in comparable store sales, store traffic, average price and operating margin,” said James D. White, Chairman, President and CEO of Jamba, Inc. “We are implementing our new Blend Plan 2.0 strategic priorities that are designed to accelerate our growth as a healthy, active lifestyle brand through product and menu innovation, retail growth in the U.S. and internationally, and expansion of our consumer products platform.

“We believe our innovative JambaGo express format and our exciting, new better-for-you smoothies and fresh juice blends have excellent prospects to power our growth. Royalty revenue from our consumer products is on track this year to achieve income levels of $3 million. Internationally, we expect to double the number of our stores by the end of the year,” said Mr. White.

First Quarter Fiscal 2012 Results

Revenue

For the first quarter ended April 3, 2012, total revenue decreased 19.8% to $53.0 million from $66.2 million in the first quarter ended April 19, 2011. The decrease is primarily due to the inclusion of 13 weeks in the fiscal 2012 first quarter compared to 16 weeks in the fiscal 2011 first quarter and the reduction in the number of company-owned stores as a result of the Company’s refranchising initiative which ended on April 19, 2011. The increase in company-owned comparable store sales of 12.7% was driven primarily by an increase in transaction count of 880 basis points and an average check increase of 390 basis points. This represents the Company’s sixth consecutive quarter of positive company-owned comparable store sales growth. In the first quarter of 2012, system-wide comparable store sales increased 11.6% and franchise-operated comparable store sales increased 10.5%. Franchise and other revenue was $3.0 million for both the 13 week period ended April 3, 2012 and the 16 week period ended April 19, 2011. The net increase in the number of franchise-operated stores and the increase in CPG revenue offsets the effect of including 13 weeks in the fiscal 2012 first quarter compared to 16 weeks in the fiscal 2011 first quarter. Jamba’s CPG licensed revenue increased to $0.3 million in the first quarter of 2012 from $0.2 million in the prior year period.

Non-GAAP Adjusted Operating Profit(2) and Non-GAAP Adjusted Operating Profit Margin(2)

Jamba’s non-GAAP adjusted operating profit margin(2) increased by 620 basis points to 20.2% for the first quarter of 2012 compared to 14.0% in the quarter ended April 19, 2011. On a dollar basis, non-GAAP operating profit increased $1.4 million from the first quarter of 2011 reflecting Company-operated store comparable sales growth and the impact of the Company’s cost savings initiatives. The Company continued to see efficiencies in the costs of sales and labor expense lines achieved through a smaller, more geographically concentrated and better performing company-owned store base as a result of its refranchising initiative which ended in April 2011. In addition, as a result of company-owned comparable store sales increase, the Company leveraged its fixed costs. During the quarter, the Company also successfully launched its line of Fit’n Fruitful smoothies with Weight Burner Boost and three new squeezed-to-order fresh juice blends.

Number of Stores

System-wide, Jamba has 749 stores in the United States, of which 444 are franchise-operated stores and 305 are company-owned. During the quarter, the Company opened four new domestic franchise stores, of which one was traditional and three were non-traditional. No new company-owned stores were opened. Six Jamba Juice stores closed system-wide. Internationally, the Company’s franchise partners opened six Jamba Juice locations comprised of three stores in South Korea, one store in the Philippines and two stores in Canada.

Outlook for 2012

The Company expects to achieve the following results for its fiscal 2012:

* Deliver positive company-owned comparable store sales(1) of 3-4%;
* Achieve adjusted operating profit margin(2) of 20-22%;
* Develop 40-50 U.S. locations, plus 10-15 new stores at international locations, all excluding JambaGo™ units;
* Maintain general and administrative expenses flat, in dollars with fiscal 2011, excluding performance compensation;
* Deliver CPG licensing revenue of approximately $3 million.

Liquidity

On April 3, 2012, the Company held $19.3 million in cash and cash equivalents as compared to $19.6 million cash and cash equivalents at January 3, 2012. On April 3, 2012, the Company had no restricted cash. At the end of fiscal 2011, the restricted cash balance was $1.4 million.

Webcast and Conference Call Information

A conference call to review the first quarter 2012 results will be held today, May 7, 2012 at 5:00 p.m. ET. The conference call can be accessed live over the phone by dialing (877) 941-1427 or for international callers by dialing (480) 629-9664. A replay will be available at 8:00 p.m. ET and can be accessed by dialing (877) 870-5176 or (858) 384-5517 for international callers; the pin number is 4528270. The replay will be available until June 13, 2012. The call can be accessed from the Company’s website at www.jambajuice.com under the Corporate Investor Relations section or directly at http://ir.jambajuice.com.

About Jamba, Inc.

Jamba, Inc. is a holding company which owns and franchises, on a global basis, Jamba Juice stores through its wholly-owned subsidiary, Jamba Juice Company. Jamba Juice Company is a leading restaurant retailer of better-for-you specialty beverages and food offerings which include great tasting fruit smoothies, fresh-squeezed juices and juice blends, hot teas, hot oatmeal made with organic steel cut oats, fruit and veggie smoothies, Fit’n FruitfulTM smoothies with Weight Burner BoostTM, Whirl’ns™ Frozen Yogurt, breakfast wraps, sandwiches, California Flatbreads™, and a variety of baked goods and snacks. As of April 3, 2012, there were 773 store locations globally, consisting of 305 Company-owned and operated stores (“Company Stores”) and 444 franchise-operated stores (“Franchise Stores”) in the United States and 24 international stores (“International Stores). As of April 3, 2012, Jamba Juice also had nine license agreements in place covering a variety of consumer packaged goods. Fans of Jamba Juice can find out more about Jamba Juice's locations as well as specific offerings and promotions by visiting the Jamba Juice website at www.JambaJuice.com or by contacting Jamba’s Guest Services team at 1-866-4R-FRUIT (473-7848).

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