BROOKLYN, N.Y., Jan. 31, 2011 (GLOBE NEWSWIRE) -- Coffee Holding Co., Inc. (Nasdaq:JVA) today announced its operating results for the fiscal year ended October 31, 2010. In this release, the Company:
- Reports net income of $2,389,361, or $0.44 per share (basic and diluted) for the fiscal year ended October 31, 2010;
- Reports net sales of $83,491,967 for the fiscal year ended October 31, 2010; and
- Reports sales growth of 12.1% for the fiscal year ended October 31, 2010 compared to the fiscal year ended October 31, 2009.
The Company had net income of $2,389,361, or $0.44 per share (basic and diluted), for the fiscal year ended October 31, 2010 compared to a net income of $3,291,066, or $0.60 per share (basic and diluted) for the fiscal year ended October 31, 2009. Results for the fiscal year ended October 31, 2009 include a one-time gain of $1,205,796, or $0.36 cents per share, on the sale of the Company's Brooklyn, New York facility.
Net sales totaled $83,491,967 for the fiscal year ended October 31, 2010, an increase of $9,040,294, or 12.1%, from $74,451,673 for the fiscal year ended October 31, 2009. The increase in net sales reflects higher coffee prices during fiscal year 2010 as compared to fiscal year 2009, the addition of the OPTCO operations and an increase in poundage sold as the Company eclipsed the 40 million pound level for the first time in its history.
Cost of sales for the fiscal year ended October 31, 2010 was $72,931,626, or 87.3% of net sales, as compared to $64,439,494, or 86.6%, of net sales for the fiscal year ended October 31, 2009. Cost of sales consists primarily of the cost of green coffee and packaging materials and realized and unrealized gains or losses on hedging activity. The increase in cost of sales reflects the increased cost of green coffee. Cost of sales includes purchases of approximately $19.3 million and $16.7 million in fiscal years 2010 and 2009, respectively, from a related party.
Total operating expenses increased $155,547, or 2.4%, to $6,544,597 for the fiscal year ended October 31, 2010 from $6,389,050 for the fiscal year ended October 31, 2009 due to a slight increase in selling and administrative expense, partially offset by a slight decrease in officers' salaries. Selling and administrative expenses increased $183,746, 2.9%, to $5,809,397 for the year ended October 31, 2010 from $5,625,651 for 2009. The slight increase in selling and administrative expenses reflects several factors, including increases of approximately $20,000 in advertising costs, $33,000 in insurance cost, $153,000 in professional services, $20,000 in office expenses and $118,000 in travel/show and demo costs, partially offset by decreases of approximately $103,000 in salaries, $50,000 in utilities and $16,000 in moving costs.
"We are pleased to report another year of positive results to our loyal shareholder base. Our continued growth as one of the leading specialty coffee dealers together with our acquisition of OPTCO in 2010 was the driving force behind a 12% increase in sales which led to an increased income from operations as compared to 2009. We believe we remain well positioned within the industry to take advantage of the coffee consumers' desire for a better cup of coffee. Our shift in our sales mix reflects this as approximately 60% of our revenues are now derived from higher end specialty coffee sales which are comprised of top quality Arabica coffees as well as our increased penetration into the fast growing organic coffee market aided by our OPTCO transaction," said Andrew Gordon, the Company's President and Chief Executive Officer.
"Sales of private label and our own brands continue to play an important role in our Company's growth. Although we have less private label business now than in past years, our current core customer base represents a solid loyal platform from which to build upon at a time when the volatility and steep rise in the green coffee market has made this end of the business an area where selectivity is vital for profitability," commented Mr. Gordon.
"We also have rolled out additional new flavors on our Entenmann's bagged coffee line which is where we have had our greatest success with this brand. We believe the future of specialty retail coffee is not only looking up for our wholesale customer base, but for our own higher end marketed brands (S&W and Entenmann's) as well," said Mr. Gordon.
"Although we continue to expect continued volatility and high prices in the Arabica coffee (commodity) market, we believe we are well positioned for continued growth and profitability in 2011," added Mr. Gordon.
The Company's previously announced quarterly cash dividend of $0.03 per share will be paid on January 31, 2011 to stockholders of record as of the close of business on January 17, 2011.
About Coffee Holding
Coffee Holding is a leading integrated wholesale coffee roaster and dealer in the United States and one of the few coffee companies that offers a broad array of coffee products across the entire spectrum of consumer tastes, preferences and price points. Coffee Holding has been a family-operated business for three generations and has remained profitable through varying cycles in the coffee industry and the economy. The Company's private label and branded coffee products are sold throughout the United States, Canada and abroad to supermarkets, wholesalers, and individually owned and multi-unit retail customers.
Any statements that are not historical facts contained in this release are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. We have based these forward-looking statements upon information available to management as of the date of this release and management's expectations and projections about certain future events. It is possible that the assumptions made by management for purposes of such statements may not materialize. Actual results may differ materially from those projected or implied in any forward-looking statements. Such statements may involve risks and uncertainties, including but not limited to those relating to product demand, pricing, market acceptance, the effect of economic conditions, intellectual property rights, the outcome of competitive products, risks in product development, the results of financing efforts, the ability to complete transactions, and other factors discussed from time to time in the Company's Securities and Exchange Commission filings. The Company undertakes no obligation to update or revise any forward-looking statement for events or circumstances after the date on which such statement is made.
CONTACT: Coffee Holding Co., Inc. Andrew Gordon, President & CEO (718) 832-0800