Tofutti Announces Third Quarter and Nine Month Results

CRANFORD, N.J., Nov. 17, 2015

Tofutti Brands reported net sales for the fourteen weeks ended October 3, 2015 of $3,671,000, an increase of $379,000, or 12%, compared to net sales of $3,292,000 for the thirteen weeks ended September 27, 2014.  The increase in revenues was mainly the result of increases in frozen dessert product sales and soy-cheese sales.  Net sales for the forty week period ended October 3, 2015 were $10,438,000, a decrease of $209,000, or 2%, compared to net sales of $10,647,000 for the thirty-nine week period ended September 27, 2014.  The decrease in sales in the 2015 forty week period was primarily attributable to the decrease in sales recorded in the first quarter of the year. In addition, in the fourteen and forty week 2015 periods promotional and allowance activity increased by $89,000 and $548,000, respectively, which negatively affected reported sales. 

The company's gross profit and gross profit percentage for the fourteen week period ending October 3, 2015 were approximately $875,000 and 24%, respectively, compared to $841,000 and 26%, respectively, for the thirteen week period ending September 27, 2014. The decrease in the gross profit percentage was due primarily to the significant increase in the sales allowance expense to $543,000 for the fourteen week period ending October 3, 2015 compared with $454,000 for the 2014 period. The company's gross profit and gross profit percentage for the forty week period ending October 3, 2015 were $2,697,000 and 26%, respectively, compared to $3,092,000 and 29%, respectively, for the thirty-nine week period ending September 27, 2014.  The decrease in the company's gross profit percentage for the 2015 forty week period was due primarily to the substantial increase in the company's promotional sales allowance programs.

For the fourteen week period ended October 3, 2015, the company reported a net loss of $126,000, or $0.02 per share, compared to a net loss of $164,000, or $0.03 per share for the thirteen week period ended September 27, 2014.  The company's net loss for the forty weeks ended October 3, 2015 was $526,000, or $0.10 per share, compared to a net loss of $248,000, or $0.05 per share, for the thirty-nine weeks ended September 27, 2014.

As of October 3, 2015, the company had approximately $136,000 in cash and cash equivalents and its working capital was approximately $2.1 million, compared with approximately $341,000 in cash and cash equivalents and working capital of $2.5 million at December 27, 2014.   

Mr. David Mintz, Chairman and Chief Executive Officer of the company stated, "While we recorded a small loss for the quarter, our principal product lines continued to show consumer acceptance. Sales of soy-cheese products increased by 18% and frozen desserts sales increased by approximately 8% as compared to the comparable period in 2014. We have reduced expenses while focusing on expanding sales of our non-dairy cheese products and frozen dessert and food products.  Price increases instituted earlier in 2015 should provide improved gross margins during the remainder of the year."

About Tofutti Brands Inc.