QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
(State or Other Jurisdiction of Incorporation or Organization) |
(I.R.S. Employer Identification No.) |
(Address of Principal Executive Offices) |
(Zip Code) |
Title of Each Class |
Trading Symbol |
Name of Each Exchange on Which Registered | ||
(NASDAQ Global Select Market) |
☒ | Accelerated filer | ☐ | ||||
Non-accelerated filer |
☐ | Smaller reporting company | ||||
Emerging growth company |
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31 |
For the Quarter Ended |
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September 23, 2021 |
September 24, 2020 |
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Net sales |
$ | $ | ||||||
Cost of sales |
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Gross profit |
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Operating expenses: |
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Selling expenses |
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Administrative expenses |
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Gain on sale of facility, net |
( |
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Total operating expenses |
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Income from operations |
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Other expense: |
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Interest expense including $ |
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Rental and miscellaneous expense, net |
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Other expense |
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Total other expense, net |
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Income before income taxes |
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Income tax expense |
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Net income |
$ | $ | ||||||
Other comprehensive income: |
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Amortization of prior service cost and actuarial loss included in net periodic cost |
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Income tax expense related to pension adjustments |
( |
) | ( |
) | ||||
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Other comprehensive income, net of tax: |
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Comprehensive income |
$ | $ | ||||||
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Net income per common share-basic |
$ | $ | ||||||
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Net income per common share-diluted |
$ | $ | ||||||
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September 23, 2021 |
June 24, 2021 |
September 24, 2020 |
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ASSETS |
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CURRENT ASSETS: |
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Cash |
$ | $ | $ | |||||||||
Accounts receivable, less allowance for doubtful accounts of $ |
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Inventories |
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Prepaid expenses and other current assets |
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Assets held for sale |
— |
— |
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TOTAL CURRENT ASSETS |
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PROPERTY, PLANT AND EQUIPMENT: |
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Land |
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Buildings |
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Machinery and equipment |
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Furniture and leasehold improvements |
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Vehicles |
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Construction in progress |
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Less: Accumulated depreciation |
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Rental investment property, less accumulated depreciation of $ |
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TOTAL PROPERTY, PLANT AND EQUIPMENT |
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Intangible assets, net |
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Cash surrender value of officers’ life insurance and other assets |
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Deferred income taxes |
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Goodwill |
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Operating lease right-of-use |
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TOTAL ASSETS |
$ | $ | $ | |||||||||
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September 23, 2021 |
June 24, 2021 |
September 24, 2020 |
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LIABILITIES & STOCKHOLDERS’ EQUITY |
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CURRENT LIABILITIES: |
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Revolving credit facility borrowings |
$ | $ | $ | |||||||||
Current maturities of long-term debt, including related party debt of $ |
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Accounts payable |
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Bank overdraft |
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Accrued payroll and related benefits |
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Other accrued expenses |
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TOTAL CURRENT LIABILITIES |
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LONG-TERM LIABILITIES: |
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Long-term debt, less current maturities, including related party debt of $ |
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Retirement plan |
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Long-term operating lease liabilities, net of current portion |
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Other |
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TOTAL LONG-TERM LIABILITIES |
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TOTAL LIABILITIES |
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COMMITMENTS AND CONTINGENCIES |
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STOCKHOLDERS’ EQUITY: |
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Class A Common Stock, convertible to Common Stock on a per share basis, cumulative voting rights of ten votes per share, $ par value; |
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Common Stock, non-cumulative voting rights of one vote per share, $ par value; |
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Capital in excess of par value |
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Retained earnings |
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Accumulated other comprehensive loss |
( |
) | ( |
) | ( |
) | ||||||
Treasury stock, at cost; |
( |
) | ( |
) | ( |
) | ||||||
TOTAL STOCKHOLDERS’ EQUITY |
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TOTAL LIABILITIES & STOCKHOLDERS’ EQUITY |
$ | $ | $ | |||||||||
Class A Common Stock |
Common Stock |
Capital in Excess of Par Value |
Retained Earnings |
Accumulated Other Comprehensive Loss |
Treasury Stock |
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Shares |
Amount |
Shares |
Amount |
Total |
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Balance, June 24, 2021 |
$ | $ | $ | $ | $ | ( |
) | $ | ( |
) | $ | |||||||||||||||||||||||||
Net income |
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Cash dividends ($ |
( |
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) | ||||||||||||||||||||||||||||||||
Pension liability amortization, net of income tax expense of $ |
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Equity award exercises, net of shares withheld for employee taxes |
— | ( |
) | ( |
) | |||||||||||||||||||||||||||||||
Stock-based compensation expense |
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Balance, September 23, 2021 |
$ | $ | $ | $ | $ | ( |
) | $ | ( |
) | $ | |||||||||||||||||||||||||
Balance, June 25, 2020 |
$ | $ | $ | $ | $ | ( |
) | $ | ( |
) | $ | |||||||||||||||||||||||||
Net income |
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Cash dividends ($ |
( |
) | ( |
) | ||||||||||||||||||||||||||||||||
Pension liability amortization, net of income tax expense of $ |
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Equity award exercises, net of shares withheld for employee taxes |
— | — | — | |||||||||||||||||||||||||||||||||
Stock-based compensation expense |
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Balance, September 24, 2020 |
$ | $ | $ | $ | $ | ( |
) | $ | ( |
) | $ |
For the Quarter Ended |
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September 23, 2021 |
September 24, 2020 |
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CASH FLOWS FROM OPERATING ACTIVITIES: |
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Net income |
$ | $ | ||||||
Depreciation and amortization |
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Gain on disposition of assets, net |
( |
) | ( |
) | ||||
Deferred income tax expense (benefit) |
( |
) | ||||||
Stock-based compensation expense |
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Change in assets and liabilities: |
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Accounts receivable, net |
( |
) | ( |
) | ||||
Inventories |
( |
) | ||||||
Prepaid expenses and other current assets |
( |
) | ||||||
Accounts payable |
( |
) | ||||||
Accrued expenses |
( |
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) | ||||
Income taxes payable |
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Other long-term assets and liabilities |
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Other, net |
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Net cash provided by operating activities |
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CASH FLOWS FROM INVESTING ACTIVITIES: |
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Purchases of property, plant and equipment |
( |
) | ( |
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Proceeds from disposition of assets, net |
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Other |
( |
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Net cash used in investing activities |
( |
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) | ||||
CASH FLOWS FROM FINANCING ACTIVITIES: |
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Net short-term borrowings |
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Principal payments on long-term debt |
( |
) | ( |
) | ||||
Decrease in bank overdraft |
( |
) | ( |
) | ||||
Dividends paid |
( |
) | ( |
) | ||||
Taxes paid related to net share settlement of equity awards |
( |
) | — | |||||
Net cash provided by (used in) financing activities |
( |
) | ||||||
NET DECREASE IN CASH |
( |
) | ( |
) | ||||
Cash, beginning of period |
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Cash, end of period |
$ | $ | ||||||
• |
References herein to fiscal 2022 and fiscal 2021 are to the 53-week fiscal year ending June 30, 2022 and the 52-week fiscal year ended June 24, 2021, respectively. |
• |
References herein to the first quarter of fiscal 2022 and fiscal 2021 are to the quarters ended September 23, 2021 and September 24, 2020, respectively. |
For the Quarter Ended |
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Distribution Channel |
September 23, 2021 |
September 24, 2020 |
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Consumer |
$ | $ | ||||||
Commercial Ingredients |
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Contract Packaging |
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Total |
$ | $ | ||||||
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September 23, 2021 |
June 24, 2021 |
September 24, 2020 |
Affected Line Item in Consolidated Balance Sheet | |||||||||||
Assets |
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Operating lease right-of-use |
$ | $ | $ | Operating lease right-of-use | ||||||||||
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Total lease right-of-use |
$ | $ | $ | |||||||||||
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Liabilities |
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Current: |
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Operating leases |
$ | $ | $ | Other accrued expenses | ||||||||||
Noncurrent: |
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Operating leases |
Long-term operating lease liabilities | |||||||||||||
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Total lease liabilities |
$ | $ | $ | |||||||||||
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For the Quarter ended September 23, 2021 |
For the Quarter ended September 24, 2020 |
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Operating lease costs ( a ) |
$ | $ | ||||||
Variable lease costs (b) |
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Total Lease Cost |
$ | $ | ||||||
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(a) |
Includes short-term leases which are immaterial. |
(b) |
Variable lease costs consist of sales tax. |
For the Quarter ended September 23, 2021 |
For the Quarter ended September 24, 2020 |
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Operating cash flows information: |
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Cash paid for amounts included in measurements for lease liabilities |
$ | $ | ||||||
Non-cash activity: |
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Right-of-use |
$ | $ |
September 23, 2021 |
June 24, 2021 |
September 24, 2020 |
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Weighted Average Remaining Lease Term (in years) |
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Weighted Average Discount Rate |
% | % | % |
Fiscal year ending |
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June 30, 2022 (excluding the quarter ended September 23, 2021) |
$ | |||
June 29, 2023 |
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June 27, 2024 |
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June 26, 2025 |
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June 25, 2026 |
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June 24, 2027 |
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Thereafter |
— | |||
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Total lease payment |
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Less imputed interest |
( |
) | ||
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Present value of operating lease liabilities |
$ | |||
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For the Quarter Ended September 23, 2021 |
For the Quarter Ended September 24, 2020 |
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Lease income related to lease payments |
$ | $ |
Fiscal year ending |
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June 24, 2022 (excluding the quarter ended September 23, 2021) |
$ |
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June 29, 2023 |
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June 27, 2024 |
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June 26, 2025 |
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June 25, 2026 |
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June 24, 2027 |
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Thereafter |
— |
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Total |
$ |
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September 23, 2021 |
June 24, 2021 |
September 24, 2020 |
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Raw material and supplies |
$ |
$ |
$ |
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Work-in-process |
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Total |
$ |
$ |
$ |
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September 23, 2021 |
June 24, 2021 |
September 24, 2020 |
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Customer relationships |
$ | $ | $ | |||||||||
Brand names |
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Non-compete agreement |
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Less accumulated amortization: |
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Customer relationships |
( |
) | ( |
) | ( |
) | ||||||
Brand names |
( |
) | ( |
) | ( |
) | ||||||
Non-compete agreement |
( |
) | ( |
) | ( |
) | ||||||
( |
) | ( |
) | ( |
) | |||||||
Net intangible assets |
$ | $ | $ | |||||||||
Fiscal year ending |
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June 29, 2023 |
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June 27, 2024 |
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June 26, 2025 |
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June 25, 2026 |
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June 24, 2027 |
For the Quarter Ended |
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September 23, 2021 |
September 24, 2020 |
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Weighted average number of shares outstanding – basic |
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Effect of dilutive securities: |
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Stock options and restricted stock units |
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Weighted average number of shares outstanding – diluted |
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For the Quarter Ended |
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September 23, 2021 |
September 24, 2020 |
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Service cost |
$ | $ | ||||||
Interest cost |
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Amortization of prior service cost |
— | |||||||
Amortization of loss |
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Net periodic benefit cost |
$ | $ | ||||||
Changes to AOCL (a) |
For the Quarter Ended |
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September 23, 2021 |
September 24, 2020 |
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Balance at beginning of period |
$ | ( |
) | $ | ( |
) | ||
Other comprehensive income before reclassifications |
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Amounts reclassified from accumulated other comprehensive loss |
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Tax effect |
( |
) | ( |
) | ||||
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Net current-period other comprehensive income |
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Balance at end of period |
$ | ( |
) | $ | ( |
) | ||
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(a) |
Amounts in parenthesis indicate debits/expense. |
Reclassifications from AOCL to earnings (b) |
For the Quarter Ended |
Affected line item in the Consolidated Statements of Comprehensive Income |
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September 23, 2021 |
September 24, 2020 |
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Amortization of defined benefit pension items: |
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Unrecognized prior service cost |
$ | $ | ( |
) | Other expense | |||||||
Unrecognized net loss |
( |
) | ( |
) | Other expense | |||||||
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Total before tax |
( |
) | ( |
) | ||||||||
Tax effect |
Income tax expense | |||||||||||
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Amortization of defined pension items, net of tax |
$ | ( |
) | $ | ( |
) | ||||||
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(b) |
Amounts in parenthesis indicate debits to expense. See Note 9 – “Retirement Plan” above for additional details. |
Level 1 | – | Quoted prices in active markets that are accessible at the measurement date for identical assets and liabilities. | ||||
Level 2 | – | Observable inputs other than quoted prices in active markets. For example, quoted prices for similar assets or liabilities in active markets or quoted prices for identical assets or liabilities in inactive markets. | ||||
Level 3 | – | Unobservable inputs for which there is little or no market data available. |
September 23, 2021 |
June 24, 2021 |
September 24, 2020 |
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Carrying value of long-term debt: |
$ | $ | $ | |||||||||
Fair value of long-term debt: |
• |
References herein to fiscal 2022 and fiscal 2021 are to the fiscal year for the 53 weeks ending June 30, 2022 and the fiscal year for the 52 weeks ended June 24, 2021, respectively. |
• |
References herein to the first quarter of fiscal 2022 and fiscal 2021 are to the quarters ended September 23, 2021 and September 24, 2020, respectively. |
For the Quarter Ended |
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Product Type |
September 23, 2021 |
September 24, 2020 |
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Peanuts |
17.7 | % | 19.5 | % | ||||
Pecans |
8.6 | 8.6 | ||||||
Cashews & Mixed Nuts |
22.4 | 23.7 | ||||||
Walnuts |
5.7 | 6.6 | ||||||
Almonds |
10.6 | 12.7 | ||||||
Trail & Snack Mixes |
28.2 | 22.8 | ||||||
Other |
6.8 | 6.1 | ||||||
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Total |
100.0 | % | 100.0 | % | ||||
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For the Quarter Ended |
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Distribution Channel |
September 23, 2021 |
Percentage of Total |
September 24, 2020 |
Percentage of Total |
$ Change |
Percent Change |
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Consumer (1) |
$ | 179,761 | 79.4 | % | $ | 166,757 | 79.3 | % | $ | 13,004 | 7.8 | % | ||||||||||||
Commercial Ingredients |
28,156 | 12.4 | 22,811 | 10.9 | 5,345 | 23.4 | ||||||||||||||||||
Contract Packaging |
18,412 | 8.2 | 20,705 | 9.8 | (2,293 | ) | (11.1 | ) | ||||||||||||||||
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Total |
$ | 226,329 | 100.0 | % | $ | 210,273 | 100.0 | % | $ | 16,056 | 7.6 | % | ||||||||||||
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(1) |
Sales of branded products were approximately 19% and 25% of total consumer channel sales during the first quarters of fiscal 2022 and fiscal 2021, respectively. Fisher Orchard Valley Harvest |
September 23, 2021 |
September 24, 2020 |
$ Change |
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Operating activities |
$ | 903 | $ | 20,577 | $ | (19,674 | ) | |||||
Investing activities |
(1,237 | ) | (6,018 | ) | 4,781 | |||||||
Financing activities |
201 | (15,351 | ) | 15,552 | ||||||||
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Net decrease in cash |
$ | (133 | ) | $ | (792 | ) | $ | 659 | ||||
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Exhibit No. |
Description | |
31.2 | Certification of Frank S. Pellegrino pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, as amended | |
32.1 | Certification of Jeffrey T. Sanfilippo pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, as amended | |
32.2 | Certification of Frank S. Pellegrino pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, as amended | |
101.INS | Inline eXtensible Business Reporting Language (XBRL) Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document. | |
101.SCH | Inline XBRL Taxonomy Extension Schema Document | |
101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document | |
101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document | |
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* | Indicates a management contract or compensatory plan or arrangement. |
JOHN B. SANFILIPPO & SON, INC. | ||
By | /s/ FRANK S. PELLEGRINO | |
Frank S. Pellegrino | ||
Chief Financial Officer, Executive Vice President, Finance and Administration |