Stock Market Watch

Jamba Inc. Cut Full-Year Guidance

by ·


Smoothie Company, Jamba Inc. (NASDAQ: JMBA) cut its full-year guidance for several key metrics, citing rising competition, slowdown in consumer spending and adverse weather conditions.

Jamba now anticipates margins to be in the range of 16% to 17% while operating margin is expected to be 1% to 2%, down from earlier forecast of store level margins of 20% and an operating margin of 2.5% to 3%.

System wide same-store-sales for the current fiscal year is expected to be flat to 1%, down from its original projection of 4% to 6%.

Speaking to analysts in conference call, Jamba Inc. Chief Executive James D. White, said, “Our analysis shows that a consumer spending slowdown reduced third quarter comparable store sales comparisons for company stores by 3% to 4%.”

For the current quarter, Mr. White expects same-store-sales to decline 3.4%.

For the next fiscal year, Jamba Inc. expects same-store-sales growth to be between 2% to 4%. Store level margin is expected between 18% and 19% and an operating margin of 2% to 3%.

For many years, the Company has been trying to lower its costs structure and improve its menu (adding more items beyond smoothies). Fast changing and highly competitive landscape, in which food companies are introducing new and nutritional items have prompted Jamba to relook at its business strategy, including international expansion.

Earlier this year, Jamba entered in a franchise agreement with Casa Operadora de Franquicias MAV to open 80 Jamba Juice stores in Mexico over the course of next ten years.

 








More Posts by this author

edliston
Post Written By: Ed Liston

Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing in his yacht.

Tags:

Ed Liston

Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing.

You may also like...