News & Events zu Coffee Holding Co Inc (JVA)JVACoffee Holding Co Inc

Coffee Holding reveals shutdown of Comfort Foods production plant

Coffee Holding announced that the Company will be closing its Comfort Foods North Andover, Massachusetts manufacturing facility at the end of the month. This facility was acquired in 2017 as the key component to the transaction that resulted in the Company purchasing the assets of Comfort Foods, which then became a 100% wholly owned subsidiary of the Company."The Comfort Foods acquisition was initially viewed by us as a long-term strategic need for our company" said Andrew Gordon, CEO. "After closing our Brooklyn, New York facility in 2009 and moving all production to our larger facility in Colorado, we knew we would eventually need to have production capabilities on the East Coast in the future in order to remain competitive for the business opportunities which could not be serviced efficiently from a logistical and profitability standpoint from the West Coast.Comfort Foods opened the door to this opportunity for a nominal price. We acquired a "turn-key", first class manufacturing facility, an established customer base and a well-established regional brand, Harmony Bay, for $2mm. Once again, roasting and manufacturing on the East Coast proved to be a winning strategy as we reestablished relationships with many large East Coast supermarket chains whose sales became the main component of our rebound in our annual revenues, which had been steadily declining for a number of years. However, as the coffee industry continues to evolve, we began to experience a steady decline in sales for the Harmony Bay product line, similar to what most regional brands have experienced. This is due to the fact that major supermarket chains have reduced shelf space that was once allocated to regional brands in order to accommodate the few remaining national brands, and the advertising dollars supporting them. This has resulted in a substantial decrease in our profitability at Comfort Foods which has impacted our overall results over the last few years. But we still relied on the facility for the production of products for our new private label customers, as well as our increased sales levels of both Cafe Caribe and Cafe Supremo Espressos. With the recent acquisition of Empire Coffee Company through Second Empire and its successful integration into our business, we believe that we can close the Massachusetts production facility and move all production into our Second Empire facility located in Port Chester, New York. This transfer of production location will improve efficiencies by providing us with both manufacturing and logistical cost savings. We believe that these operational improvements should have a positive effect on profitability. Also, by not operating redundant manufacturing facilities on the East Coast and transferring all private brand, Harmony Bay, Cafe Supremo and Cafe Caribe production to the Second Empire facility we expect to eventually realize additional annualized net savings on overhead of approximately $700k through the closure of the Massachusetts facility."

Coffee Holding announces Q3 earnings per share of 21 cents, compared to 11 cents in the previous year.

Reports Q3 revenue $23.9M vs. $18.8M last year. "We had net sales of $23.9M for the three months ending July 31, 2025 compared to $18.8M for the same period in 2024, an increase of 27%. However, we experienced a net loss of $1.19M for the period, as our derivative positions represented a $2.2M negative impact on our profitability." Said Andrew Gordon, CEO. "Operations continue to remain strong, and it was unfortunate that our derivatives had such an effect on our results, but the coffee market was in freefall for most of the quarter as the uncertainty and the impact of President Trump's tariffs along with the weight of next Brazil's harvest sent coffee prices spiraling lower by $1.25 in the third quarter. Fortunately, we held our positions during the period, as coffee prices have now resumed their prior upward trajectory and are trading near all-time historic highs again. We believe this will ensure that our inventory positions continue to be secured at least through the end of 2025. In addition, we believe a reversal of the unrealized loss on many of these derivatives in the fourth quarter will occur, thereby boosting profits and confirming the previously announced anticipated dividend based on our year-end profits. Also, during this quarter, our latest acquisition, Second Empire, recorded a profit in July. This success in a relatively short period of time hopefully confirms the future success of our initiatives. We now expect Second Empire to be accretive to earnings on a go-forward basis. Although our borrowing increased during this quarter, we built our inventories in advance to avoid the maximum impact of the tariffs. This was essential, as the decline in coffee prices forced many of our competitors into price concessions, which now have to be reversed due to the recent climb in coffee prices. Our company, on the other hand, held to our previously announced price increases and did not pass on the additional costs resulting from the tariffs to our customers, which had a minimal impact on us for the three-month period. Moving forward, however, as we continue to deplete our 'tariff-free' inventories, it may become necessary for us to implement tariffs to many of our wholesale and retail customers, similar to what the national brands are doing, in order to maintain our margins. We do not expect major pushback against implementing such price increases as this has unfortunately become normalized in the industry over the last several months. Lastly, although this quarter's earnings were disappointing due to the unrealized loss on derivatives, operations still remain profitable during what I consider to be the most challenging period I've seen in my forty years in the coffee industry. I believe we are headed for a promising outlook for the fourth quarter and the near future."