Jamba Juice CEO and CFO Resign

Wednesday, August 6, 2008
Jamba Juice CEO and CFO quitSan Francisco Business Times - by Steven E.F. Brown
San Francisco Business Times
http://www.bizjournals.com/sanfrancisco/stories/2008/08/04/daily30.html

Jamba Inc. CEO Paul Clayton and CFO Donald Breen quit and Chairman Steven Berrard took over as interim CEO.

The Emeryville company (NASDAQ: JMBA), the parent of Jamba Juice, didn't say why the two men quit. But Jamba has been losing money. Its accumulated deficit -- how much money it's lost since it started -- was $175.2 million as of April 22, according to its SEC filings.

Controller Karen Luey becomes interim chief financial officer.

In early July, Karen Kelley quit as senior vice president of operations at Jamba Juice Co. Two men who worked under her -- Steve Adkins and Glenn Lord -- divvied up her work and started reporting directly to CEO Clayton at that time.

Berrard has been Jamba's chairman since January 2005. he was CEO until November 2006. He was paid $100,000 in cash as a director in 2007, according to Jamba's proxy card.

Breen became CFO and Clayton became CEO in late November 2006. Breen's salary in 2007 was $282,691 and Clayton's was $514,903.

Jamba estimated its second quarter sales at $98.6 million, up 10 percent from the $89.6 million in sales it had in the second quarter a year ago. Its second quarter ended July 15 and the company won't give a full profit-and-loss report until Aug. 21.

Same store sales -- an important retail metric comparing sales only at stores open at least a year -- fell 6.8 percent in the quarter, on top of a fall of 3.3 percent a year ago. In stores owned by the company itself, not franchises, same store sales fell even more, 7.3 percent.

At the end of the quarter Jamba had 736 stores, up from 726 at the start. During the quarter it opened 21 stores, 14 of them company owned, and closed 11 stores, all company owned.

In the first quarter ended April 22, the last for which it has filed a report, Jamba lost $6.4 million on sales of $101.6 million. During that quarter it said sales at the 99 new company owned stores opened during 2007 "were lower than expected." Jamba said in SEC filings it would open fewer company owned stores than it previously planned during 2008.

In May the company said it would close 10 stores not doing well and also terminate leases for seven stores not yet built.

Jamba started selling breakfast during the first quarter, hoping to attract more business. But it noted that "a concentration of Company Stores in California" might affect its business.

Starbucks (NASDAQ: SBUX), another company that some people think has too many stores -- on Battery Street in downtown San Francisco two are directly across the road from each other -- has also hit bumps in its growth plans and said last month it would close 600 stores that weren't doing well.