With a global pandemic, there’s been considerable demand for packaged baked goods.
In fact, such products saw a 37% increase in sales in March 2020 alone year over year, according to IRI, as highlighted by Candy Industry. All as folks indulge in comfort foods while at home. According to USA Today, “Snacks are enjoying a feast, according to companies like Conagra Brands, which sells Slim Jim jerky and Orville Redenbacher's popcorn.” Such news is creating opportunity for companies such as Blackhawk Growth Corp. (CSE:BLR)(OTC:BLRZF), TreeHouse Foods Inc. (NYSE:THS), J&J Snack Foods Corp. (NASDAQ:JJSF), Hostess Brands Inc. (NASDAQ:TWNK), and J.M. Smucker Co. (NYSE:SJM).
Blackhawk Growth Corp. (CSE:BLR)(OTC:BLRZF) BREAKING NEWS: Blackhawk Growth Corp. provided a corporate update on its latest investment NuWave Foods Inc. NuWave recently signed a “Technology Evaluation and License Option Agreement” with EnWave Corporation (TSX.V:ENW). During the term of the TELOA, NuWave will have full access to EnWave’s patented drying technology and access to their food engineers for product development and technology evaluation purposes. In addition, NuWave has the option to license EnWave’s Radiant Energy Vacuum technology for donuts and fritters in North America. REV™ equipment is expected to arrive at NuWave’s Edmonton facility in the coming weeks.
"This is a huge leap forward” said Frederick Pels CEO of Blackhawk. “Access to EnWave’s proven equipment for the dehydration of baked goods will allow NuWave to rapidly expand its product line through collaborative product development. We couldn't be more excited to be working with the amazing team at EnWave, and the timing of this agreement could not be more important. Amid the growing threat of COVID-19, people all over North America have been scrambling to stock their pantries with limited options available. NuWave is positioned to bring high quality, shelf stable baked goods to the marketplace at a time when it's needed the most. With EnWave’s technology and NuWave's quality products and methods, we are able to keep food preservative free and get it to the market quickly. We look forward to growing with NuWave as they create products designed for the world's rapidly changing needs. "
Other related developments from around the markets include:
TreeHouse Foods Inc. (NYSE:THS) reported first quarter GAAP loss per diluted share from continuing operations of $(0.58) compared to $(0.26) reported for the first quarter of 2019. The Company had adjusted earnings per diluted share from continuing operations1 of $0.37 in the first quarter of 2020 compared to $0.33 in the first quarter of 2019. "We want to thank all of our employees for working tirelessly - in our manufacturing plants, as we have ramped up production; in our warehouses, as we have been working diligently to fulfill orders; and throughout our customer-facing organization, as we have partnered with our customers to service the heightened order flow. I'm very proud of the way the entire TreeHouse organization has come together in the midst of the COVID-19 crisis to deliver solid operational, commercial and financial results," said Steve Oakland, Chief Executive Officer and President. "First quarter adjusted EPS of $0.37 and revenue of $1.08 billion came in above our expectations, as our hard work over the last three years to transform the business and our reorganization from three to two divisions have enabled us to quickly and successfully escalate production to meet the significantly higher demand for food and beverages during this pandemic."
J&J Snack Foods Corp. (NASDAQ:JJSF) announced sales and earnings for the second quarter ended March 28, 2020. Sales decreased 2% to $272.0 million from $276.3 million in last year’s second quarter. Net earnings decreased 64% to $7.3 million in the current quarter from $20.4 million last year. Earnings per diluted share decreased 65% to $.38 for the second quarter from $1.08 last year. Operating income decreased 56% to $11.0 million in the current quarter from $24.8 million in the year ago quarter. For the six months ended March 28, 2020, sales increased 1% to $554.9 million from $547.9 million in last year’s first half. Net earnings decreased 36% to $24.4 million in the six months from $37.9 million last year. Earnings per diluted share decreased 36% to $1.28 from $2.00 last year. Operating income decreased 30% to $32.7 million this year from $46.9 million last year. The Company also said that sales for the first 4 weeks of its third quarter that will end June 27, 2020 were down approximately 45% from a year ago. Although it cannot estimate whether sales will continue to be down at the same rate for the balance of the quarter, the Company said that it might have an operating loss in the quarter which would compare to operating income of $39 million in the year ago June quarter if sales continue to be down at the same rate. Approximately 2/3 of the Company’s sales are to venues and locations that have shut down or sharply curtailed their foodservice operations so the Company anticipates COVID-19 will continue to have a negative impact on its business. As the Company has $267 million of cash and marketable securities on its balance sheet, it does not expect to have any liquidity issues, nor does it anticipate a material amount of its assets would be impaired.
Hostess Brands Inc. (NASDAQ:TWNK) reported its financial results for the three months ended March 31, 2020. “We achieved strong results exceeding our expectations during the beginning of the first quarter prior to the impacts of COVID-19,” commented Andy Callahan, the Company's President and Chief Executive Officer. “In light of the COVID-19 pandemic we have implemented meaningful changes to our operations to address our primary concern for the health and safety of our employees as we execute through this unprecedented operating environment. Our agile operating network has enabled us to be responsive and adjust to the changes we are facing while the dedication and perseverance of our employees has allowed us to successfully deliver against rapidly evolving consumer demands.” Mr. Callahan continued, “During the quarter our team executed on the growth of core Hostess®, completed significant integration activities for the recently acquired Voortman business and implemented operational improvements enabling us to exceed our financial targets for the first quarter and enabling us to continue to drive future sustainable, long-term profitable growth. Going forward, while we are pleased with our start to the year and our opportunities to benefit from additional food-at-home consumption, the greatest uncertainty is the duration and magnitude of the COVID-19 pandemic and its potential impact on our business and supply chain. We are confident that the challenges and lessons learned during this time will make us stronger with our long-term objectives still well within our reach.”
J.M. Smucker Co. (NYSE:SJM) announced that its Board of Directors has approved a $0.88 per share dividend on the common shares of the Company. The dividend will be paid on Monday, June 1, 2020, to shareholders of record at the close of business on Friday, May 15, 2020. The Company also announced that its Annual Meeting of Shareholders will be held on Wednesday, August 19, 2020. The meeting will be held at 10:00 a.m., Mountain Time, at The St. Julien Hotel, 900 Walnut Street, Boulder, Colorado 80302, subject to any changes caused by the COVID-19 pandemic. Shareholders of record at the close of business on Monday, June 22, 2020, will be entitled to notice of the annual meeting and to vote on matters considered at the meeting.
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