0001437749-14-007320.txt : 20140428 0001437749-14-007320.hdr.sgml : 20140428 20140428160152 ACCESSION NUMBER: 0001437749-14-007320 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 11 CONFORMED PERIOD OF REPORT: 20140329 FILED AS OF DATE: 20140428 DATE AS OF CHANGE: 20140428 FILER: COMPANY DATA: COMPANY CONFORMED NAME: J&J SNACK FOODS CORP CENTRAL INDEX KEY: 0000785956 STANDARD INDUSTRIAL CLASSIFICATION: COOKIES & CRACKERS [2052] IRS NUMBER: 221935537 STATE OF INCORPORATION: NJ FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-14616 FILM NUMBER: 14789446 BUSINESS ADDRESS: STREET 1: 6000 CENTRAL HGWY CITY: PENNSAUKEN STATE: NJ ZIP: 08109 BUSINESS PHONE: 6096659533 MAIL ADDRESS: STREET 1: 6000 CENTRAL HIGHWAY CITY: PENNSAUKEN STATE: NJ ZIP: 08109 10-Q 1 jjsf20140331_10q.htm FORM 10-Q jjsf20140331_10q.htm

UNITED STATES

 

SECURITIES AND EXCHANGE COMMISSION

 

Washington, D.C. 20549

 

FORM 10-Q

 

(Mark One)

 

X     Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

 

For the period ended March 29, 2014

or

 

 

Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

 

Commission File Number:     0-14616

 

J & J SNACK FOODS CORP.

(Exact name of registrant as specified in its charter)

 

New Jersey 

22-1935537 

 

(State or other jurisdiction of  

(I.R.S. Employer 

 

incorporation or organization)

Identification No.) 

 

                 

6000 Central Highway, Pennsauken, NJ 08109

(Address of principal executive offices)

 

Telephone (856) 665-9533

 

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

 

X     Yes  

No 

                                            

 

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

 

X     Yes  

No 

                                            

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer,” “non-accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

 

Large Accelerated filer (X)  

Accelerated filer ( ) 

 

 

 

 

Non-accelerated filer ( ) 

Smaller reporting company ( ) 

 

(Do not check if a smaller reporting company)

 

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

 

Yes 

X     No 

                                             

 

As April 21, 2014 there were 18,701,116 shares of the Registrant’s Common Stock outstanding.

 

 
1

 

 

INDEX

 

 

 

 

 

Page

Number

       

Part I.     Financial Information

 

 

 

 

 

 

Item l.     Consolidated Financial Statements 

 

 

 

 

 

    Consolidated Balance Sheets  March 29, 2014 (unaudited) and September 28, 2013  3

 

 

 

 

    Consolidated Statements of Earnings (unaudited) – Three and Six Months Ended March 29, 2014 and March 30, 2013 4

 

 

 

 

    Consolidated Statements of Comprehensive Income (unaudited) – Three and Six Months Ended March 29, 2014 and March 30, 2013 5

 

 

 

 

    Consolidated Statements of Cash Flows (unaudited) – Six Months Ended March 29, 2014 and March 30, 2013  6

 

 

 

 

    Notes to the Consolidated Financial Statements (unaudited)   7

 

 

 

 

  Item 2.     Management’s Discussion and Analysis of Financial Condition and Results of Operations  19

 

 

 

 

  Item 3.     Quantitative and Qualitative Disclosures About Market Risk  23

 

 

 

 

 

Item 4.     Controls and Procedures

23

       

Part II.     Other Information 

 

 

 

 

 

  Item 6.     Exhibits 24

 

 
2

 

 

 J & J SNACK FOODS CORP. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(in thousands, except share amounts)

 

   

March 29,

2014

(unaudited)

   

September 28,
2013

 

Assets

               

Current assets

               

Cash and cash equivalents

  $ 77,301     $ 97,345  

Marketable securities held to maturity

    -       256  

Accounts receivable, net

    86,870       87,545  

Inventories, net

    76,752       71,785  

Prepaid expenses and other

    3,918       3,284  

Deferred income taxes

    4,638       4,502  

Total current assets

    249,479       264,717  
                 

Property, plant and equipment, at cost

               

Land

    2,496       2,496  

Buildings

    26,741       26,741  

Plant machinery and equipment

    188,172       179,331  

Marketing equipment

    252,260       244,770  

Transportation equipment

    6,730       5,953  

Office equipment

    17,847       16,282  

Improvements

    26,231       24,917  

Construction in progress

    4,600       9,952  
      525,077       510,442  

Less accumulated depreciation and amortization

    369,822       363,278  
      155,255       147,164  
                 

Other assets

               

Goodwill

    84,615       76,899  

Other intangible assets, net

    42,575       44,012  

Marketable securities held to maturity

    2,000       2,000  

Marketable securities available for sale

    128,740       107,664  

Other

    3,330       3,205  
      261,260       233,780  
    $ 665,994     $ 645,661  
                 

Liability and Stockholder's Equity

               

Current Liabilities

               

Current obligations under capital leases

  $ 212     $ 211  

Accounts payable

    54,226       50,906  

Accrued insurance liability

    10,044       9,954  

Accrued income taxes

    465       1,740  

Accrued liabilities

    4,913       3,769  

Accrued compensation expense

    10,153       13,671  

Dividends payable

    5,983       2,988  

Total current liabilities

    85,996       83,239  
                 

Long-term obligations under capital leases

    430       136  

Deferred income taxes

    45,132       45,183  

Other long-term liabilities

    536       538  
                 

Stockholders' Equity

               

Preferred stock, $1 par value; authorized 10,000,000 shares; none issued

    -       -  

Common stock, no par value; authorized, 50,000,000 shares; issued and outstanding 18,701,000 and 18,677,000 respectively

    36,712       34,516  

Accumulated other comprehensive loss

    (4,777 )     (5,930 )

Retained Earnings

    501,965       487,979  
      533,900       516,565  
    $ 665,994     $ 645,661  

  

The accompanying notes are an integral part of these statements.

 
3

 

 

J & J SNACK FOODS CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF EARNINGS

(Unaudited)

(in thousands, except per share amounts)

 

   

Three months ended

   

Six months ended

 
   

March 29,

2014

   

March 30,

2013

   

March 29,

2014

   

March 30,

2013

 
                                 

Net Sales

  $ 205,321     $ 201,326     $ 408,844     $ 392,734  
                                 

Cost of goods sold(1)

    144,208       143,175       287,825       280,448  

Gross Profit

    61,113       58,151       121,019       112,286  
                                 

Operating expenses

                               

Marketing (2)

    17,519       16,809       35,551       33,945  

Distribution (3)

    16,382       15,713       32,502       31,113  

Administrative (4)

    6,781       6,460       13,765       13,059  

Other general expense (income)

    99       10       898       (51 )
      40,781       38,992       82,716       78,066  
                                 

Operating Income

    20,332       19,159       38,303       34,220  
                                 

Other income (expense)

                               

Investment income

    976       896       2,114       1,672  

Interest expense & other

    (27 )     (28 )     (63 )     (53 )
                                 

Earnings before income taxes

    21,281       20,027       40,354       35,839  
                                 

Income taxes

    7,760       7,367       14,407       12,953  
                                 

NET EARNINGS

  $ 13,521     $ 12,660     $ 25,947     $ 22,886  
                                 

Earnings per diluted share

  $ 0.72     $ 0.67     $ 1.38     $ 1.21  
                                 

Weighted average number of diluted shares

    18,819       18,886       18,806       18,878  
                                 

Earnings per basic share

  $ 0.72     $ 0.67     $ 1.39     $ 1.22  
                                 

Weighted average number of basic shares

    18,693       18,800       18,686       18,803  

 

(1)

Includes share-based compensation expense of $117 and $235 for the three months and six months ended March 29, 2014, respectively and $102 and $227 for the three months and six months ended March 30, 2013.

(2)

Includes share-based compensation expense of $170 and $340 for the three months and six months ended March 29,2014, respectively and $137 and $310 for the three months and six months ended March 30, 2013.

(3)

Includes share-based compensation expense of $11 and $21 for the three months and six months ended March 29, 2014, respectively and $7 and $15 for the three months and six months ended March 30, 2013.

(4)

Includes share-based compensation expense of $227 and $453 for the three months and six months ended March 29, 2014, respectively and $163 and $364 for the three months and six months ended March 30, 2013.

See accompanying notes to the consolidated financial statements

  

 
4

 

 

J&J SNACK FOODS CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)

(in thousands)

 

   

Three months ended

   

Six months ended

 
   

March 29,

2014

   

March 30,

2013

   

March 29,

2014

   

March 30,

2013

 
                                 

Net Earnings

  $ 13,521     $ 12,660     $ 25,947     $ 22,886  
                                 

Foreign currency translation adjustments

    (172 )     570       (276 )     447  

Unrealized holding gain on marketable securities

    956       166       1,429       184  
                                 

Total Other Comprehensive Income, net of tax

    784       736       1,153       631  
                                 

Comprehensive Income

  $ 14,305     $ 13,396     $ 27,100     $ 23,517  

 

 

All amounts are net of tax.

 

 
5

 

 

J & J SNACK FOODS CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)     (in thousands)

 

   

Six months ended

 
   

March 29,

2014

   

March 30,

2013

 

Operating activities:

               

Net earnings

  $ 25,947     $ 22,886  

Adjustments to reconcile net earnings to net cash provided by operating activities:

               

Depreciation of fixed assets

    15,591       13,864  

Amortization of intangibles and deferred costs

    2,511       2,388  

Share-based compensation

    1,049       916  

Deferred income taxes

    (189 )     (86 )

Loss on sale of marketable securities

    296       -  

Other

    (126 )     (63 )

Changes in assets and liabilities net of effects from purchase of companies

               

Decrease(increase)in accounts receivable

    636       (2,797 )

Increase in inventories

    (5,106 )     (5,090 )

Increase in prepaid expenses

    (633 )     (920 )

Decrease in accounts payable and accrued liabilities

    (889 )     (2,543 )

Net cash provided by operating activities

    39,087       28,555  

Investing activities:

               

Payment for purchases of of companies, net of cash acquired

    (11,000 )     -  

Purchases of property, plant and equipment

    (20,825 )     (15,557 )

Purchases of marketable securities

    (25,747 )     (83,342 )

Proceeds from redemption and sales of marketable securities

    6,060       23,478  

Proceeds from disposal of property and equipment

    815       493  

Other

    (92 )     (36 )

Net cash used in investing activities

    (50,789 )     (74,964 )

Financing activities:

               

Payments to repurchase common stock

    -       (2,763 )

Proceeds from issuance of stock

    1,023       2,576  

Payments on capitalized lease obligations

    (204 )     (177 )

Payment of cash dividend

    (8,966 )     (5,449 )

Net cash used in financing activities

    (8,147 )     (5,813 )

Effect of exchange rate on cash and cash equivalents

    (195 )     362  

Net decrease in cash and cash equivalents

    (20,044 )     (51,860 )

Cash and cash equivalents at beginning of period

    97,345       154,198  

Cash and cash equivalents at end of period

  $ 77,301     $ 102,338  

 

See accompanying notes to the consolidated financial statements.

  

 
6

 

 

J & J SNACK FOODS CORP. AND SUBSIDIARIES

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

 

Note 1

In the opinion of management, the accompanying unaudited consolidated financial statements contain all adjustments (consisting of only normal recurring adjustments) necessary to present fairly the financial position and the results of operations and cash flows. Certain prior year amounts have been reclassified to conform to the current period presentation. These reclassifications had no effect on reported net earnings.

 

The results of operations for the three and six months ended March 29, 2014 and March 30, 2013 are not necessarily indicative of results for the full year. Sales of our frozen beverages and frozen juice bars and ices are generally higher in our third and fourth quarters due to warmer weather.

 

While we believe that the disclosures presented are adequate to make the information not misleading, it is suggested that these consolidated financial statements be read in conjunction with the consolidated financial statements and the notes included in the Company’s Annual Report on Form 10-K for the fiscal year ended September 28, 2013.

 

Note 2

We recognize revenue from our products when the products are shipped to our customers. Repair and maintenance equipment service revenue is recorded when it is performed provided the customer terms are that the customer is to be charged on a time and material basis or on a straight-line basis over the term of the contract when the customer has signed a service contract. Revenue is recognized only where persuasive evidence of an arrangement exists, our price is fixed or estimable and collectability is reasonably assured. We record offsets to revenue for allowances, end-user pricing adjustments, trade spending, coupon redemption costs and returned product. Customers generally do not have the right to return product unless it is damaged or defective. We provide an allowance for doubtful receivables after taking into consideration historical experience and other factors. The allowance for doubtful receivables was $820,000 and $854,000 at March 29, 2014 and September 28, 2013, respectively.

 

Note 3

Depreciation of equipment and buildings is provided for by the straight-line method over the assets’ estimated useful lives. Amortization of improvements is provided for by the straight-line method over the term of the lease or the assets’ estimated useful lives, whichever is shorter. Licenses and rights, customer relationships and non-compete agreements arising from acquisitions are amortized by the straight-line method over periods ranging from 3 to 20 years. Depreciation expense was $7,903,000 and $7,074,000 for the three months ended March 29, 2014 and March 30, 2013, respectively, and for the six months ended March 29, 2014 and March 30, 2013 was $15,591,000 and $13,864,000 respectively.

 

 
7

 

 

Note 4

Basic earnings per common share (EPS) excludes dilution and is computed by dividing income available to common shareholders by the weighted average common shares outstanding during the period. Diluted EPS takes into consideration the potential dilution that could occur if securities (stock options) or other contracts to issue common stock were exercised and converted into common stock. Our calculation of EPS is as follows:

 

 

   

Three Months Ended March 29, 2014

 
   

Income

(Numerator)

   

Shares

(Denominator)

   

Per Share

Amount

 
                         
   

(in thousands, except per share amounts)

 

Basic EPS

                       

Net Earnings available to common stockholders

  $ 13,521       18,693     $ 0.72  
                         

Effect of Dilutive Securities

                       

Options

    -       126       -  
                         

Diluted EPS

                       

Net Earnings available to common stockholders plus assumed conversions

  $ 13,521       18,819     $ 0.72  

 

 

   

Six Months Ended March 29, 2014

 
   

Income

(Numerator)

   

Shares

(Denominator)

   

Per Share

Amount

 
                         
   

(in thousands, except per share amounts)

 

Basic EPS

                       

Net Earnings available to common stockholders

  $ 25,947       18,686     $ 1.39  
                         

Effect of Dilutive Securities

                       

Options

    -       120       (0.01 )
                         

Diluted EPS

                       

Net Earnings available to common stockholders plus assumed conversions

  $ 25,947       18,806     $ 1.38  

  

 
8

 

 

 

   

Three Months Ended March 30, 2013

 
   

Income

(Numerator)

   

Shares

(Denominator)

   

Per Share

Amount

 
                         
   

(in thousands, except per share amounts)

 

Basic EPS

                       

Net Earnings available to common stockholders

  $ 12,660       18,800     $ 0.67  
                         

Effect of Dilutive Securities

                       

Options

    -       86       -  
                         

Diluted EPS

                       

Net Earnings available to common stockholders plus assumed conversions

  $ 12,660       18,886     $ 0.67  

 

 

   

Six Months Ended March 30, 2013

 
   

Income

(Numerator)

   

Shares

(Denominator)

   

Per Share

Amount

 
                         
   

(in thousands, except per share amounts)

 

Basic EPS

                       

Net Earnings available to common stockholders

  $ 22,886       18,803     $ 1.22  
                         

Effect of Dilutive Securities

                       

Options

    -       75       (0.01 )
                         

Diluted EPS

                       

Net Earnings available to common stockholders plus assumed conversions

  $ 22,886       18,878     $ 1.21  

 

Note 5

At March 29, 2014, the Company has three stock-based employee compensation plans. Share-based compensation was recognized as follows:

  

 
9

 

 

 

   

Three months ended

   

Six months ended

 
   

March 29, 2014

   

March 30, 2013

   

March 29, 2014

   

March 30, 2013

 
   

(in thousands, except per share amounts)

 
                                 
                                 

Stock Options

  $ 388     $ 215     $ 700     $ 390  

Stock purchase plan

    48       45       177       137  

Stock issued to outside directors

    -       12       -       24  

Restricted stock issued to an employee

    4       5       8       9  
    $ 440     $ 277     $ 885     $ 560  
                                 

Per diluted share

  $ 0.02     $ 0.01     $ 0.05     $ 0.03  
                                 

The above compensation is net of tax benefits

  $ 85     $ 132     $ 164     $ 356  

 

 

The Company anticipates that share-based compensation will not exceed $1.7 million net of tax benefits, or approximately $.09 per share for the fiscal year ending September 27, 2014.

 

The fair value of each option grant is estimated on the date of grant using the Black-Scholes options-pricing model with the following weighted average assumptions used for grants in fiscal 2014 first six months: expected volatility of 20.6%; risk-free interest rate of 1.4%; dividend rate of .8% and expected lives of 5 years.

 

During the 2014 six month period, the Company granted 98,975 stock options. The weighted-average grant date fair value of these options was $15.21. During the 2013 six month period, the Company granted 1,100 stock options. The weighted-average grant date fair value of these options was $12.24.

 

Expected volatility is based on the historical volatility of the price of our common shares over the past 55 months for 5 year options and 10 years for 10 year options. We use historical information to estimate expected life and forfeitures within the valuation model. The expected term of awards represents the period of time that options granted are expected to be outstanding. The risk-free rate for periods within the expected life of the option is based on the U.S. Treasury yield curve in effect at the time of grant. Compensation cost is recognized using a straight-line method over the vesting or service period and is net of estimated forfeitures.

 

Note 6

We account for our income taxes under the liability method. Under the liability method, deferred tax assets and liabilities are determined based on the difference between the financial statement and tax bases of assets and liabilities as measured by the enacted tax rates that will be in effect when these differences reverse.  Deferred tax expense is the result of changes in deferred tax assets and liabilities.

  

 
10

 

 

Additionally, we recognize a liability for income taxes and associated penalties and interest for tax positions taken or expected to be taken in a tax return which are more likely than not to be overturned by taxing authorities (“uncertain tax positions”).  We have not recognized a tax benefit in our financial statements for these uncertain tax positions.  

 

The total amount of gross unrecognized tax benefits is $420,000 and $438,000 on March 29, 2014 and September 28, 2013, respectively, all of which would impact our effective tax rate over time, if recognized. We recognize interest and penalties related to income tax matters as a part of the provision for income taxes. As of March 29, 2014 and September 28, 2013, respectively, the Company has $222,000 and $224,000 of accrued interest and penalties.


In addition to our federal tax return and tax returns for Mexico and Canada, we file tax returns in all states that have a corporate income tax with virtually all open for examination for three to four years.

 

Note 7

In February 2013, the FASB issued guidance which requires us to provide information about the amounts reclassified out of accumulated other comprehensive income by component. In addition, we are required to present, either on the face of the statement where net income is presented or in the notes, significant amounts reclassified out of accumulated other comprehensive income by the respective line items of net income but only if the amount reclassified is required under U.S. GAAP to be reclassified to net income in its entirety in the same reporting period. For other amounts not required under U.S. GAAP to be reclassified in their entirety to net income, we are required to cross-reference to other disclosures required under U.S. GAAP that provide additional detail about those amounts. This guidance was effective for our fiscal year 2014 first quarter and its adoption did not have a material impact on our financial statements.

 

 
11

 

 

Note 8

Inventories consist of the following:

 

   

March 29, 2014

   

September 28, 2013

 
   

(unaudited)

         
   

(in thousands)

 
                 

Finished goods

  $ 36,296     $ 33,013  

Raw Materials

    14,530       14,489  

Packaging materials

    6,428       5,937  

Equipment parts & other

    19,498       18,346  
    $ 76,752     $ 71,785  
                 

The above inventories are net of reserves

  $ 4,544     $ 4,449  

 

 

Note 9

We principally sell our products to the food service and retail supermarket industries. Sales and results of our frozen beverages business are monitored separately from the balance of our food service business because of different distribution and capital requirements. We maintain separate and discrete financial information for the three operating segments mentioned above which is available to our Chief Operating Decision Makers.

 

We have applied no aggregation criteria to any of these operating segments in order to determine reportable segments. Our three reportable segments are Food Service, Retail Supermarkets and Frozen Beverages. All inter-segment net sales and expenses have been eliminated in computing net sales and operating income (loss). These segments are described below.

 

Food Service

 

The primary products sold by the food service group are soft pretzels, frozen juice treats and desserts, churros, dough enrobed handheld products and baked goods. Our customers in the food service industry include snack bars and food stands in chain, department and discount stores; malls and shopping centers; fast food outlets; stadiums and sports arenas; leisure and theme parks; convenience stores; movie theatres; warehouse club stores; schools, colleges and other institutions. Within the food service industry, our products are purchased by the consumer primarily for consumption at the point-of-sale.

 

 

Retail Supermarkets

 

The primary products sold by the retail supermarket segment are soft pretzel products – including SUPERPRETZEL, frozen juice treats and desserts including LUIGI’S Real Italian Ice, MINUTE MAID Juice Bars and Soft Frozen Lemonade, WHOLE FRUIT frozen fruit bars, WHOLE FRUIT Sorbet, ICEE Squeeze-Up Tubes, dough enrobed handheld products and TIO PEPE’S Churros. Within the retail supermarket channel, our frozen and prepackaged products are purchased by the consumer for consumption at home.

   

 
12 

 

 

Frozen Beverages

 

We sell frozen beverages and related products to the food service industry primarily under the names ICEE, ARCTIC BLAST,

SLUSH PUPPIE and PARROT ICE in the United States, Mexico and Canada. We also provide repair and maintenance service to customers for customers’ owned equipment.

  

The Chief Operating Decision Maker for Food Service and Retail Supermarkets and the Chief Operating Decision Maker for Frozen Beverages monthly review detailed operating income statements and sales reports in order to assess performance and allocate resources to each individual segment. In addition, the Chief Operating Decision Makers review and evaluate depreciation, capital spending and assets of each segment on a quarterly basis to monitor cash flow and asset needs of each segment. Information regarding the operations in these three reportable segments is as follows:

 

 

   

Three months ended

   

Six months ended

 
   

March 29,

2014

   

March 30,

2013

   

March 29,

2014

   

March 30,

2013

 
   

(unaudited)

 
   

(in thousands)

 

Sales to External Customers:

                               

Food Service

                               

Soft pretzels

  $ 38,815     $ 35,337     $ 78,123     $ 67,931  

Frozen juices and ices

    11,857       10,122       20,086       17,649  

Churros

    13,430       14,067       27,381       27,874  

Handhelds

    5,712       6,938       12,116       13,252  

Bakery

    66,169       67,084       135,245       135,389  

Other

    2,346       1,845       4,158       3,485  
    $ 138,329     $ 135,393     $ 277,109     $ 265,580  
                                 

Retail Supermarket

                               

Soft pretzels

  $ 10,309     $ 10,046     $ 19,224     $ 18,624  

Frozen juices and ices

    8,402       8,998       14,825       15,468  

Handhelds

    4,815       5,117       10,102       11,430  

Coupon redemption

    (689 )     (754 )     (1,369 )     (1,543 )

Other

    213       146       432       277  
    $ 23,050     $ 23,553     $ 43,214     $ 44,256  
                                 

Frozen Beverages

                               

Beverages

  $ 26,713     $ 25,183     $ 51,902     $ 50,480  

Repair and maintenance service

    13,135       12,710       26,744       24,552  

Machines sales

    3,759       3,945       9,282       6,993  

Other

    335       542       593       873  
    $ 43,942     $ 42,380     $ 88,521     $ 82,898  
                                 

Consolidated Sales

  $ 205,321     $ 201,326     $ 408,844     $ 392,734  
                                 

Depreciation and Amortization:

                               

Food Service

  $ 5,233     $ 4,717     $ 10,372     $ 9,226  

Retail Supermarket

    8       7       16       15  

Frozen Beverages

    3,921       3,541       7,714       7,011  
    $ 9,162     $ 8,265     $ 18,102     $ 16,252  
                                 

Operating Income:

                               

Food Service

  $ 17,562     $ 15,363     $ 32,713     $ 27,960  

Retail Supermarket

    2,602       2,404       4,566       3,974  

Frozen Beverages

    168       1,392       1,024       2,286  
    $ 20,332     $ 19,159     $ 38,303     $ 34,220  
                                 

Capital Expenditures:

                               

Food Service

  $ 4,991     $ 4,682     $ 10,839     $ 9,942  

Retail Supermarket

    -       -       -       -  

Frozen Beverages

    6,517       3,394       9,986       5,615  
    $ 11,508     $ 8,076     $ 20,825     $ 15,557  
                                 

Assets:

                               

Food Service

  $ 505,745     $ 471,807     $ 505,745     $ 471,807  

Retail Supermarket

    6,051       6,082       6,051       6,082  

Frozen Beverages

    154,198       141,944       154,198       141,944  
    $ 665,994     $ 619,833     $ 665,994     $ 619,833  

  

 
13

 

 

Note 10

Our three reporting units, which are also reportable segments, are Food Service, Retail Supermarkets and Frozen Beverages.

 

The carrying amounts of acquired intangible assets for the Food Service, Retail Supermarkets and Frozen Beverage segments as of March 29, 2014 and September 29, 2013 are as follows:

 

   

March 29, 2014

   

September 28, 2013

 
   

Gross

Carrying

Amount

   

Accumulated Amortization

   

Gross

Carrying

Amount

   

Accumulated Amortization

 
    (in thousands)  
                                 

FOOD SERVICE

                               

Indefinite lived intangible assets

                               

Trade Names

  $ 13,072     $ -     $ 12,880     $ -  
                                 

Amortized intangible assets

                               

Non compete agreements

    592       493       545       478  

Customer relationships

    40,797       28,051       40,187       26,187  

License and rights

    3,606       2,661       3,606       2,614  
    $ 58,067     $ 31,205     $ 57,218     $ 29,279  
                                 

RETAIL SUPERMARKETS

                               
                                 

Indefinite lived intangible assets

                               

Trade Names

  $ 4,006     $ -     $ 4,006     $ -  
                                 

Amortized Intangible Assets

                               

Customer relationships

    279       78       279       62  
    $ 4,285     $ 78     $ 4,285     $ 62  
                                 
                                 

FROZEN BEVERAGES

                               
                                 

Indefinite lived intangible assets

                               

Trade Names

  $ 9,315     $ -     $ 9,315     $ -  
                                 

Amortized intangible assets

                               

Non compete agreements

    198       198       198       198  

Customer relationships

    6,478       5,139       6,478       4,830  

Licenses and rights

    1,601       749       1,601       714  
    $ 17,592     $ 6,086     $ 17,592     $ 5,742  
                                 

CONSOLIDATED

  $ 79,944     $ 37,369     $ 79,095     $ 35,083  

  

 

 

Amortized intangible assets are being amortized by the straight-line method over periods ranging from 3 to 20 years and amortization expense is reflected throughout operating expenses. Intangible assets of $849,000 were acquired in the food service segment in the New York Pretzel acquisition in the three months ended December 28, 2013. Aggregate amortization expense of intangible assets for the three months ended March 29, 2014 and March 30, 2013 was $1,143,000 and $1,113,000, respectively and for the six months ended March 29,2014 and March 30, 2013 was $2,286,000 and $2,232,000, respectively.

 

 
14

 

  

Estimated amortization expense for the next five fiscal years is approximately $4,600,000 in 2014, $4,500,000 in 2015 and $4,300,000 in 2016, $1,800,000 in 2017 and $1,000,000 in 2018. The weighted average amortization period of the intangible assets is 10.1 years.

 

Goodwill

 

The carrying amounts of goodwill for the Food Service, Retail Supermarket and Frozen Beverage segments are as follows:

 

   

Food

Service

   

Retail

Supermarket

   

Frozen

Beverages

   

Total

 
    (in thousands)  

Balance at March 29, 2014

  $ 46,831     $ 1,844     $ 35,940     $ 84,615  

 

 

Goodwill of $7,716,000 was acquired in the New York Pretzel acquisition in the three months ended December 28, 2013, all of which was allocated to the food service segment.

 

Note 11

We have classified our investment securities as marketable securities held to maturity and available for sale. The FASB defines fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, the FASB has established three levels of inputs that may be used to measure fair value:

 

Level 1

Observable input such as quoted prices in active markets for identical assets or liabilities;

 

Level 2

Observable inputs, other than Level 1 inputs in active markets, that are observable either directly or indirectly; and

 

Level 3

Unobservable inputs for which there is little or no market data, which require the reporting entity to develop its own assumptions.

 

Marketable securities held to maturity and available for sale values are derived solely from level 1 inputs.

  

 
15

 

 

The amortized cost, unrealized gains and losses, and fair market values of our investment securities held to maturity at March 29, 2014 are summarized as follows:

 

   

Amortized

Cost

   

Gross

Unrealized

Gains

   

Gross

Unrealized

Losses

   

Fair

Market

Value

 
    (in thousands)  
                                 

US Government Agency Debt

  $ 2,000       -     $ 32     $ 1,968  
    $ 2,000     $ -     $ 32     $ 1,968  

 

 

  

The amortized cost, unrealized gains and losses, and fair market values of our investment securities available for sale at March 29, 2014 are summarized as follows:

 

 

   

Amortized

Cost

   

Gross

Unrealized

Gains

   

Gross

Unrealized

Losses

   

Fair

Market

Value

 
    (in thousands)  
                                 

Mutual Funds

  $ 129,538     $ 779     $ 1,577     $ 128,740  
                                 
    $ 129,538     $ 779     $ 1,577     $ 128,740  

 

The mutual funds seek current income with an emphasis on maintaining low volatility and overall moderate duration. The funds do not have contractual maturities; however, we classify them as long term assets as it is our intent to hold them for a period of over one year, although we may sell some or all of them depending on presently unanticipated needs for liquidity or market conditions. The unrealized losses of $1,577,000 are spread over 22 funds with total fair market value of $82.2 million.

 

The amortized cost, unrealized gains and losses, and fair market values of our investment securities held to maturity at September 28, 2013 are summarized as follows:

 

   

Amortized

Cost

   

Gross

Unrealized

Gains

   

Gross

 Unrealized

Losses

   

Fair

Market

Value

 
    (in thousands)  

US Government Agency Debt

  $ 2,000     $ -     $ 50     $ 1,950  

Certificates of Deposit

    256       -       -       256  
    $ 2,256     $ -     $ 50     $ 2,206  

  

 
16

 

 

The amortized cost, unrealized gains and losses, and fair market values of our investment securities available for sale at September 28, 2013 are summarized as follows:

 

   

Amortized

Cost

   

Gross

Unrealized

Gains

   

Gross

Unrealized

Losses

   

Fair

Market

Value

 
   

(in thousands)

 
                                 

Mutual Funds

  $ 109,891     $ 254     $ 2,481     $ 107,664  
                                 
    $ 109,891     $ 254     $ 2,481     $ 107,664  

 

The amortized cost and fair value of the Company’s held to maturity securities by contractual maturity at March 29, 2014 and September 28, 2013 are summarized as follows:

 

    March 29, 2014    

September 28, 2013

 
                                 
   

Amortized

Cost

   

Fair

 Market

Value

   

Amortized

Cost

   

Fair

 Market

Value

 
    (in thousands)  

Due in one year or less

  $ -     $ -     $ 256     $ 256  

Due after one year through five years

    -       -       -       -  

Due after five years through ten years

    2,000       1,968       2,000       1,950  

Total held to maturity securities

  $ 2,000     $ 1,968     $ 2,256     $ 2,206  

Less current portion

    -       -       256       256  

Long term held to maturity securities

  $ 2,000     $ 1,968     $ 2,000     $ 1,950  

 

 

Proceeds from the redemption and sale of marketable securities were $565,000 and $6,060,000 in the three and six months ended March 29, 2014 respectively, and $23,238,000 and $23,478,000 in the three and six months ended March 30, 2013, respectively. Losses of $36,000 and $296,000 were recorded in the three and six months ended March 29, 2014, respectively, and none were recorded last year. We use the specific identification method to determine the cost of securities sold.

 

 

Note 12

In June 2012, we acquired the assets of Kim & Scott’s Gourmet Pretzels, Inc., a manufacturer and seller of a premium brand soft pretzel. This business had sales of approximately $8 million over the prior twelve months to food service and retail supermarket customers and had sales of approximately $1.8 million in our 2012 fiscal year from the acquisition date.

 

In October 2013, we acquired the assets of New York Pretzel, a manufacturer and distributor of soft pretzels selling primarily in the northeast to foodservice and retail locations.  Of the purchase price of $11.8 million, $849,000 was allocated to intangible assets, $7,716,000 was allocated to goodwill and $3,049,000 was allocated to property, plant and equipment.    

  

 
17

 

 

These acquisitions were and will be accounted for under the purchase method of accounting, and their operations are and will be included in the consolidated financial statements from their respective acquisition dates.

 

 

 

The goodwill and intangible assets acquired in the business combinations are recorded at fair value. To measure fair value for such assets, we use techniques including discounted expected future cash flows (Level 3 input).

 

Note 13 Changes to the components of accumulated other comprehensive loss are as follows:

 

   

Three Months Ended March 29, 2014

   

Six Months Ended March 29, 2014

 
    (unaudited)     (unaudited)  
    (in thousands)     (in thousands)  
                                                 
   

Foreign Currency Translation Adjustments

   

Unrealized Holding Loss on Marketable Securities

   

Total

   

Foreign Currency Translation Adjustments

   

Unrealized Holding Loss on Marketable Securities

   

Total

 
                                                 

Beginning Balance

  $ (3,807 )   $ (1,754 )   $ (5,561 )   $ (3,703 )   $ (2,227 )   $ (5,930 )
                                                 

Other comprehensive income (loss) before reclassifications

    (172 )     914       742       (276 )     1,126       850  
                                                 

Amounts reclassified from accumulated other comprehensive income

    -       42       42       -       303       303  
                                                 

Ending Balance

  $ (3,979 )   $ (798 )   $ (4,777 )   $ (3,979 )   $ (798 )   $ (4,777 )

 

 

All amounts are net of tax.

  

 
18

 

 

   

Three Months Ended March 30, 2013

   

Six Months Ended March 30, 2013

 
    (unaudited)     (unaudited)  
    (in thousands)     (in thousands)  
                                                 
    Foreign Currency Translation Adjustments     Unrealized Holding Loss on Marketable Securities    

Total

    Foreign Currency Translation Adjustments    

Unrealized Holding Loss on Marketable Securities

   

Total

 
                                                 

Beginning Balance

  $ (3,255 )   $ 18     $ (3,237 )   $ (3,132 )   $ -     $ (3,132 )
                                                 

Other comprehensive income (loss) before reclassifications

    570       166       736       447       184       631  
                                                 

Amounts reclassified from accumulated other comprehensive income

    -       -       -       -       -       -  
                                                 

Ending Balance

  $ (2,685 )   $ 184     $ (2,501 )   $ (2,685 )   $ 184     $ (2,501 )

 

 

All amounts are net of tax.

 

 

 

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

Liquidity and Capital Resources

 

Our current cash and cash equivalents balances and cash expected to be provided by future operations are our primary sources of liquidity. We believe that these sources, along with our borrowing capacity, are sufficient to fund future growth and expansion. See Note 11 to these financial statements for a discussion of our investment securities.

 

The Company’s Board of Directors declared a regular quarterly cash dividend of $.32 per share of its common stock payable on April 3, 2014, to shareholders of record as of the close of business on March 14, 2014.

 

In our fiscal year ended September 28, 2013, we purchased and retired 204,397 shares of our common stock at a cost of $14,500,215. We did not purchase any shares in the six months ended March 29, 2014. On November 8, 2012 the Company’s Board of Directors authorized the purchase and retirement of an additional 500,000 shares of the Company’s common stock; 343,858 shares remain to be purchased under this authorization.

  

 
19

 

 

In the three months ended March 29, 2014 and March 30, 2013 fluctuations in the valuation of the Mexican and Canadian currencies and the resulting translation of the net assets of our Mexican and Canadian subsidiaries caused an increase of $172,000 in accumulated other comprehensive loss in the 2014 second quarter and an decrease of $570,000 in accumulated other comprehensive loss in the 2013 second quarter. In the six month period, fluctuations in the valuation of the Mexican and Canadian currencies and the resulting translation of the net assets of our Mexican and Canadian subsidiaries caused an increase of $276,000 in accumulated other comprehensive loss in the 2014 six month period and a decrease of $447,000 in accumulated other comprehensive loss in the 2013 six month period.

 

Our general-purpose bank credit line which expires in December 2016 provides for up to a $50,000,000 revolving credit facility. The agreement contains restrictive covenants and requires commitment fees in accordance with standard banking practice. There were no outstanding balances under this facility at March 29, 2014.

 

 

Results of Operations

 

Net sales increased $3,995,000 or 2% to $205,321,000 for the three months and $16,110,000 or 4% to $408,844,000 for the six months ended March 29, 2014 compared to the three and six months ended March 30, 2013.

 

We believe our sales, and to a lesser extent, our costs, were impacted by the severe weather which occurred in many parts of the country during the current three month period; although we are unable to quantify the impact on our operating income.  Most of our product sales are to consumers at snack bar and food stand locations, restaurants and schools so to the extent that traffic was reduced at these locations because of weather, our sales were affected.       

 

FOOD SERVICE

 

Sales to food service customers increased $2,936,000 or 2% in the second quarter to $138,329,000 and increased $11,529,000 or 4% for the six months. Excluding sales resulting from the acquisition of New York Pretzel in October 2013, food service sales increased approximately 1.5% for the second quarter and increased 4% for the six months. Soft pretzel sales to the food service market increased 10% to $38,815,000 in the second quarter and increased 15% to $78,123,000 in the six months due to increased sales to restaurant chains, warehouse club stores, school food service and throughout our customer base. Increased sales to one customer accounted for approximately 1/2 of the increase in pretzel sales in the quarter and 40% in the six months. Without New York Pretzel, pretzel sales increased about 7% for the second quarter and 13% for the six months. Frozen juices and ices sales increased 17% to $11,857,000 in the three months and 14% to $20,086,000 in the six months resulting from sales increases primarily to warehouse club stores. Churro sales to food service customers decreased 5% to $13,430,000 in the second quarter and were down 2% to $27,381,000 for the six months which was net of a decline in sales of $465,000 in the quarter and $1,229,000 in the six months to one restaurant chain which rolled out a churros product in the year ago period.

  

 
20

 

 

Sales of bakery products decreased $915,000 or 1% in the second quarter to $66,169,000 and were essentially unchanged at $135,245,000 for the six months as sales increases and decreases were spread throughout our customer base.

 

Sales of new products in the first twelve months since their introduction were approximately $2.1 million in this quarter and $4.6 million in the six months. Price increases accounted for approximately $1.3 million of sales in the quarter and $2.2 million in the six months and net volume increases, including new product sales as defined above and sales resulting from the acquisition of New York Pretzel, accounted for approximately $1.6 million of sales in the quarter and $9.3 million in the six months.

 

Operating income in our Food Service segment increased from $15,363,000 to $17,562,000 in the quarter and increased from $27,960,000 to $32,713,000 in the six months. Operating income for the quarter and six months benefited from increased sales volume, price increases and lower ingredient costs.

 

RETAIL SUPERMARKETS

 

Sales of products to retail supermarkets decreased $503,000 or 2% to $23,050,000 in the second quarter and decreased $1,042,000 or 2% to $43,214,000 in the six months. Soft pretzel sales for the second quarter were up 3% to $10,309,000 and were up 3% to $19,224,000 for the six months on a unit volume increase of 2% for the quarter and 2% for the six months. Sales of frozen juices and ices decreased $596,000 or 7% to $8,402,000 in the second quarter and were down 4% to $14,825,000 for the six months on a unit volume decrease of 8% in the quarter and 7% in the six months. Lower sales to one customer accounted for all of the sales decrease in both periods. Coupon redemption costs, a reduction of sales, decreased 9% or about $65,000 for the quarter and decreased 11% to $1,369,000 for the six months. Handheld sales to retail supermarket customers decreased 6% to $4,815,000 in the quarter and decreased 12% to $10,102,000 for the six months with sales increases and decreases throughout our customer base; however, sales to one customer were down over $700,000 for the second quarter and sales to two customers were down about $1.7 million for the six months as products introduced in the year ago period have not been successful.

 

Price increases accounted for approximately $300,000 of sales in the quarter and $1.0 million in the six months and net volume decreases, net of decreased coupon costs, accounted for approximately $800,000 of the sales decrease in this quarter and $2.0 million in the six months. Operating income in our Retail Supermarkets segment increased from $2,404,000 to $2,602,000 in the quarter and from $3,974,000 to $4,566,000 in the six months primarily because of higher gross margins because of product mix and lower coupon expense.

 

 
21

 

 

FROZEN BEVERAGES

 

Frozen beverage and related product sales increased 4% to $43,942,000 in the second quarter and increased 7% to $88,521,000 in the six month period. Beverage related sales alone were up 6% to $26,713,000 in the second quarter and were up 3% to $51,902,000 in the six month period.    Gallon sales were up 5% for the three months and were up 2% for the six month period. Service revenue increased 3% to $13,135,000 in the second quarter and increased 9% to $26,744,000 for the six month period with sales increases and decreases spread throughout our customer base.

 

Sales of beverage machines, which tend to fluctuate from year to year while following no specific trend, were $186,000 or 5% lower in the second quarter and were $2,289,000 or 33% higher in the six month period. The approximate number of company owned frozen beverage dispensers was 46,500 and 44,700 at March 29, 2014 and September 28, 2013, respectively. Operating income in our Frozen Beverage segment was $168,000 in this quarter and $1,024,000 for the six months compared to $1,392,000 and $2,286,000; respectively, last year as higher operating expenses in these seasonally low periods offset the benefits of increased sales. Group health insurance and liability insurance costs were higher by about $900,000 in the quarter and $800,000 in the six months compared to last year due primarily to an unusually high level of medical claims under our self-insured group health insurance program.

 

CONSOLIDATED

 

Gross profit as a percentage of sales increased to 29.76% in the three month period from 28.88% last year and increased to 29.60% in the six month period from 28.59% a year ago. Higher volume in our food service segment was the primary reason for the improved gross profit margin in the six month period while lower ingredients costs benefitted both the three and six month periods.

 

Total operating expenses increased $1,789,000 in the second quarter and as a percentage of sales increased from 19.37% percent to 19.86%. About 1/3 of the increase in total operating expenses were higher group health insurance costs due primarily to an unusually high level of medical claims under our self-insured group health insurance program. For the first half, operating expenses increased $4,650,000, and as a percentage of sales increased from 19.88% to 20.23%. Operating expenses in the six months this year include $800,000 of other general expenses for shutdown costs of our Norwalk, CA manufacturing facility as well as about $500,000 of higher group health insurance costs. Marketing expenses increased from 8.3% to 8.5% of sales in the quarter and increased from 8.6% to 8.7% of sales in the six months. Distribution expenses were 8.0% of sales in this year’s quarter and were 7.8% of sales in last year’s quarter, and were 7.9% of sales in both years’ six month period. Administrative expenses were 3.3% of sales this quarter and 3.4% for the six month period as compared to 3.2% of sales last year in the second quarter and 3.3% for the six months.

 

Operating income increased $1,173,000 or 6% to $20,332,000 in the second quarter and increased $4,083,000 or 12% to $38,303,000 in the first half as a result of the aforementioned items.      

  

 
22

 

 

Investment income increased by $80,000 and $442,000 in the second quarter and six months, respectively, due primarily to increased investments of marketable securities. We have investments of $128.7 million in mutual funds that seek current income with an emphasis on maintaining low volatility and overall moderate duration. We estimate the annual yield from these funds to approximate 3.5 – 3.75%.

 

The effective income tax rate has been estimated at 36.5% and 36.8% for the quarter this year and last year, respectively and 35.7% and 36.1% for the six months this year and last year, respectively. We are estimating an effective income tax rate of approximately 36% for the year. 

 

Net earnings increased $861,000 or 7% in the current three month period to $13,521,000 and increased 13% to $25,947,000 for the six months this year from $22,886,000 as a result of the aforementioned items.

 

There are many factors which can impact our net earnings from year to year and in the long run, among which are the supply and cost of raw materials and labor, insurance costs, factors impacting sales as noted above, the continuing consolidation of our customers, our ability to manage our manufacturing, marketing and distribution activities, our ability to make and integrate acquisitions and changes in tax laws and interest rates.

 

 

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

 

There has been no material change in the Company’s assessment of its sensitivity to market risk since its presentation set forth, in item 7a. “Quantitative and Qualitative Disclosures About Market Risk,” in its 2013 annual report on Form 10-K filed with the SEC.

 

Item 4.

Controls and Procedures

 

The Chief Executive Officer and the Chief Financial

Officer of the Company (its principal executive officer and principal financial officer, respectively) have concluded, based on their evaluation as of March 29, 2014, that the Company’s disclosure controls and procedures are effective to ensure that information required to be disclosed by the Company in the reports filed or submitted by it under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and include controls and procedures designed to ensure that information required to be disclosed by the Company in such reports is accumulated and communicated to the Company’s management, including the Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

  

 
23

 

 

There has been no change in the Company’s internal control over financial reporting during the quarter ended March 29, 2014, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

 

 

 PART II. OTHER INFORMATION

 

 

Item 6.

Exhibits

 

Exhibit No.

 

 

31.1 &  31.2 

Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

    

 

 

99.5 &
99.6

Certification Pursuant to the 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

 

 

101.1

The following financial information from J&J Snack Foods Corp.'s Quarterly Report on Form 10-Q for the quarter ended March 29, 2014, formatted in XBRL (extensible Business Reporting Language):

 

(i)

Consolidated Balance Sheets,

 

(ii)

Consolidated Statements of Earnings,

 

(iii)

Consolidated Statements of Comprehensive Income,

 

(iv)

Consolidated Statements of Cash Flows and

 

(v)

the Notes to the Consolidated Financial Statements

                 

 
24

 

 

SIGNATURES

 

 

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

 

J & J SNACK FOODS CORP. 

   
   
   
Dated: April 28, 2014 /s/ Gerald B. Shreiber
 

Gerald B. Shreiber

 

Chairman of the Board,

 

President, Chief Executive

 

Officer and Director

 

(Principal Executive Officer)

   
   
   
Dated: April 28, 2014 /s/ Dennis G. Moore
 

Dennis G. Moore, Senior Vice

 

President, Chief Financial

 

Officer and Director

 

(Principal Financial Officer)

 

(Principal Accounting Officer)

 

 

25

EX-31 2 ex31-1.htm EXHIBIT 31.1

Exhibit 31.1

 

CERTIFICATION PURSUANT TO

SECTION 302

OF THE SARBANES-OXLEY ACT OF 2002

 

I, Dennis G. Moore, certify that:

 

1.    I have reviewed this report on Form 10-Q of J & J Snack Foods Corp.;

 

2.    Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 

3.    Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

 

4.    The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal controls and procedures for financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

a)     designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)     designed such internal controls and procedures for financial reporting, or caused such internal controls over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 
 

 

c)     evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)     disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s second fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.    The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

a)     all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b)     any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls over financial reporting.

Date: April 28, 2014

 

 

 

 

/s/ Dennis G. Moore

Dennis G. Moore, Senior Vice

President, Chief Financial

Officer and Director

(Principal Financial Officer)

(Principal Accounting Officer)

 

 

EX-31 3 ex31-2.htm EXHIBIT 31.2

Exhibit 31.2

 

CERTIFICATION PURSUANT TO

SECTION 302

OF THE SARBANES-OXLEY ACT OF 2002

 

I, Gerald B. Shreiber, certify that:

 

1.    I have reviewed this report on Form 10-Q of J & J Snack Foods Corp.;

 

2.    Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 

3.    Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

 

4.    The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal controls and procedures for financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

a)     designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)     designed such internal controls and procedures for financial reporting, or caused such internal controls over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 
 

 

c)     evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)     disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s second fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.    The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

a)     all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b)     any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls over financial reporting.

Date: April 28, 2014

 

 

/s/ Gerald B. Shreiber

Gerald B. Shreiber

Chairman of the Board,

President, Chief Executive

Officer and Director

(Principal Executive Officer) 

 

EX-99 4 ex99-5.htm EXHIBIT 99.5

Exhibit 99.5

 

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

 

 

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (Section 1350 of Chapter 63 of Title 18 of the United States Code), each of the undersigned officers of J & J Snack Foods Corp. (the “Company”), does hereby certify with respect to the Quarterly Report of the Company on Form 10-Q for the quarter ended March 29, 2014 (the “Report”) that:

 

 

(1)

The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

 

 

(2)

The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

 

Dated: April 28, 2014

 

/s/ Dennis G. Moore

Dennis G. Moore, Senior Vice

President, Chief Financial

Officer and Director

(Principal Financial Officer)

(Principal Accounting Officer) 

 

 

The foregoing certification is being furnished solely pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (Section 1350 of Chapter 63 of Title 18 of the United States Code) and is not being filed as part of the Report or as a separate disclosure document.

EX-99 5 ex99-6.htm EXHIBIT 99.6

Exhibit 99.6

 

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

 

 

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (Section 1350 of Chapter 63 of Title 18 of the United States Code), each of the undersigned officers of J & J Snack Foods Corp. (the “Company”), does hereby certify with respect to the Quarterly Report of the Company on Form 10-Q for the quarter ended March 29, 2014 (the “Report”) that:

 

 

(1)

The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

 

 

(2)

The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

 

 

 

Dated: April 28, 2014

 

/s/ Gerald B. Shreiber

Gerald B. Shreiber

Chairman of the Board,

President, Chief Executive

Officer and Director

(Principal Executive Officer) 

 

 

The foregoing certification is being furnished solely pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (Section 1350 of Chapter 63 of Title 18 of the United States Code) and is not being filed as part of the Report or as a separate disclosure document.

 

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