CoolBrands International, Inc. (formerly Yogen Fruz World-Wide Incorporated) (TSE: YF.A – news) today reported net earnings for the quarter ending May 31, 2000 of $1,412,000 or $0.03 per share, as compared to net earnings for the same period of the prior year of $723,000 or $0.02 per share.
Earnings before income taxes for the third quarter of fiscal 2000 were $2,112,000, as compared to $161,000 for the same period of the prior year. Earnings before income taxes were reduced by a $338,000 non-cash special charge relating solely to the asset impairment charge taken in the second quarter due to the increase in the US$ conversion rate to Cdn$ during the third quarter. Earnings before the non-cash asset impairment special charge were $2,450,000, or approximately 15 times greater than $161,000 for the same period of the prior year. EBITDA for the quarter increased by 125% to $3,646,000, as compared to $1,618,000 for the same period of the prior year.
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Sales of consumer products grew by approximately 10% in the quarter as compared with the same period of the prior year. Operating results for the quarter improved primarily due to the increased sales of consumer products, which have higher gross margins than the Company’s other products, and by improved gross margins for all of the Company’s products in 2000 as compared with the 1999 quarter.
Additionally, operating results were favorably impacted by reduced selling, general and administrative expenses which declined $423,000 to $11,340,000 for the quarter ended May 31, 2000, from $11,763,000 for the quarter ended May 31, 1999 and by a $164,000 improvement in company-owned store operations, primarily due to the sale of Company-owned stores to franchisees.
Increased sales of consumer products during the quarter were offset by a decline of bulk ice cream and frozen yogurt product sales, lower franchising revenues and lower sales by the fewer remaining company-owned stores for the quarter as compared with the same period of the prior year, reflecting fewer stores open during the current quarter as compared with the same quarter of the prior year. As a result, total revenues for the quarter were $28,781,000 as compared to $29,539,000 for the same period of the prior year.
During the third quarter, shareholders approved changing the Company’s name to CoolBrands International, Inc. from Yogen Fruz World-Wide Incorporated. The Company’s Class A subordinate voting shares continue to trade using the symbol YF.A on the Toronto Stock Exchange.
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By GlobalDataAs of May 31, 2000, CoolBrands has company-owned, franchised and non-traditional partnership locations in 82 countries. The Company operates a Family of Brands including Yogen Fruz, I Can’t Believe It’s Yogurt, Bresler’s Ice Cream and Premium Frozen Yogurt, Swensen’s Ice Cream, Steve’s Ice Cream, Golden Swirl, Paradise, Ice Cream Churn and Java Coast Fine Coffees. The Company also directly, and through its subsidiary Integrated Brands, markets, sells and distributes Tropicana frozen fruit juice bars and frozen dessert products, as well as a variety of frozen novelties and frozen dessert products under the Betty Crocker, Trix, Yoplait, Colombo and Yoo Hoo brand names, pursuant to long-term license agreements.
“Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995: Information in this release relating to the Company’s future plans and performance are “forward looking statements” and, as such, involve certain risks and uncertainties that could cause actual results to vary materially. Potential risks and uncertainties include, but are not limited to: (1) the highly competitive nature of the frozen dessert market and the level of consumer interest in the Company’s products (2) product costing, (3) the weather, (4) the performance of management, including management’s ability to implement its plans as contemplated, (5) the Company’s relationships with its customers, franchisees, licensees and licensors, and (6) government regulation.
Summary Financial Data
(In Thousands of dollars, except for share data):
Nine Months Ended
May 31,
2000 1999
$ $
Revenues 65,116 70,505
Earnings (loss) before non-cash asset
impairment special charge 267 (742)
Non-cash asset impairment special
charge (24,807)
(Loss) Earnings before income taxes (24,540) (742)
Benefit of (provision for) income taxes (513) 866
Net earnings (loss) before non-cash
asset impairment special charge (246) 124
Net earnings (loss) (25,053) 124
Earnings (Loss) per share before non-
cash asset impairment special charge
-Basic and fully diluted (.01) Nil
-Fully Diluted (.01) Nil
Earnings (Loss) Per Share
– Basic (.55) Nil
– Fully dilluted (.54) Nil
Weighted average number of shares
outstanding 45,823 45,778
EBITDA 4,519 3,527
Three Months Ended
May 31,
2000 1999
$ $
Revenues 28,781 29,539
Earnings (loss) before non-cash asset
impairment special charge 2,450 161
Non-cash asset impairment special
charge (338)
(Loss) Earnings before income taxes 2,112 161
Benefit of (provision for) income taxes (700) 562
Net earnings (loss) before non-cash
asset impairment special charge 1,750 723
Net earnings (loss) 1,412 723
Earnings (Loss) per share before non-
cash asset impairment special charge
-Basic and fully diluted .04 .02
-Fully Diluted .04 .02
Earnings (Loss) Per Share
– Basic .03 .02
– Fully dilluted .03 .02
Weighted average number of shares
outstanding 45,826 45,779
EBITDA 3,646 1,618
