STATEN ISLAND, N.Y., March 17, 2011 (GLOBE NEWSWIRE) -- Coffee Holding Co., Inc. ("Coffee Holding") (Nasdaq:JVA) today announced its operating results for the three months ended January 31, 2011. In this release, the Company:
- Reports net sales of $25,641,093 for the three months ended January 31, 2011 and $21,359,151 for the three months ended January 31, 2010;
- Reports sales growth of 20% for the three months ended January 31, 2011 compared to the three months ended January 31, 2010; and
- Reports net income of $1,041,072, or $0.19 per share (basic and diluted), for the three months ended January 31, 2011 compared to net income of $557,978, or $0.10 per share (basic and diluted), for the three months ended January 31, 2010.
Results of Operations
The Company had net income of $1,041,072, or $0.19 per share (basic and diluted), for the three months ended January 31, 2011 compared to net income of $557,978, or $0.10 per share (based and diluted), for the three months ended January 31, 2010. The increase in net income primarily reflects increased gross profit.
Net sales totaled $25,641,093 for the three months ended January 31, 2011, an increase of $4,281,942, or 20% from $21,359,151 for the three months ended January 31, 2010. The increase in net sales reflects higher sales prices compared to the first quarter of fiscal 2010 as well as additional poundage sold due to the addition of our OPTCO subsidiary.
Cost of sales for the three months ended January 31, 2011 was $22,560,399 or 87.9% of net sales, as compared to $18,721,421 or 87.7% of net sales for the three months ended January 31, 2010. The increase in cost of sales reflects the increased cost of green coffee.
Total operating expenses increased by $97,188, or 6.11%, to $1,686,096 for the three months ended January 31, 2011 as compared to operating expenses of $1,588,908 for the three months ended January 31, 2010. The increase in operating expenses was due to increases in selling and administrative expense of $67,221 and an increase in officers' salaries of $30,001. The added expenses were justified due to the high level of business during this period.
"In spite of commodity pressure and dramatically increased coffee prices during the quarter, we were still able to almost double our net income as compared to the same period last year. Our horizontal integrated business structure combined with our hedging policies helped us to significantly alleviate these higher costs as evidenced by our cost of sales only slightly increasing by 0.02 % during a time when the underlying commodity increased by over one dollar per pound as the fundamentals in the coffee market led to higher futures prices. With the national brands and our other competitors increasing their prices, but not to the full effect of the increase in the futures market, we remained under financial constraints on a portion of our private label sales; yet we were able to absorb much of those margin pressures through other areas of our business. We anticipate this trend will continue and we have just implemented another round of price increases which should be reflected in the results of our upcoming quarter even as coffee prices continue to climb to over thirty year highs."
"We remain upbeat regarding our overall business and believe we are well positioned to continue to improve both our top and bottom lines during these challenging times," said Andrew Gordon, President & CEO.
The Company's previously announced quarterly cash dividend of $0.03 per share will be paid to stockholders of record as of the close of business on April 18, 2011. The dividend will be paid on May 2, 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, coffee prices, pricing of our products, 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