SANFILIPPO JOHN B & SON INC

Our net sales of $281.8 million for the third quarter of fiscal 2026 increased $20.9 million, or 8.0%, from our net sales of $260.9 million for the third quarter of fiscal 2025. Net sales for the first thirty-nine weeks of fiscal 2026 increased by $57.1 million, or 6.8%, to $895.2 million compared to the first thirty-nine weeks of fiscal 2025.

Sales volume, measured as pounds sold to customers, decreased 0.3% compared to the third quarter of fiscal 2025. Sales volume for the first thirty-nine weeks of fiscal 2026 decreased 3.7% compared to the first thirty-nine weeks of fiscal 2025.

Gross profit decreased $2.1 million, and our gross profit margin, as a percentage of net sales, decreased to 19.1% for the third quarter of fiscal 2026, compared to 21.4% for the third quarter of fiscal 2025. Gross profit increased $12.3 million, and our gross profit margin increased to 18.7% from 18.5% for the first thirty-nine weeks of fiscal 2026 compared to the first thirty-nine weeks of fiscal 2025.

Total operating expenses for the third quarter of fiscal 2026 increased by $2.3 million, or 8.3%, compared to the third quarter of fiscal 2025. As a percentage of net sales, total operating expenses was 10.6% for both the third quarter of fiscal 2026 and fiscal 2025. Total operating expenses for the first thirty-nine weeks of fiscal 2026 increased by $0.1 million, or 0.2%, compared to the first thirty-nine weeks of fiscal 2025. As a percentage of net sales, total operating expenses for the first thirty-nine weeks of fiscal 2026 decreased to 10.1% from 10.8% for the first thirty-nine weeks of fiscal 2025.

The total value of inventories on hand at the end of the third quarter of fiscal 2026 decreased $5.2 million, or 2.0%, compared to the total value of inventories on hand at the end of the third quarter of fiscal 2025.

We have seen acquisition costs for most major nut types, except for walnuts and peanuts, increase in the 2025 crop year (which falls into our current 2026 fiscal year). We completed procurement of inshell walnuts during the first half of fiscal 2026 and the final total payments due to our walnut growers were determined in the current quarter. The final prices paid, and remaining to be paid to the walnut growers, were based upon current market prices and other factors, such as crop size and export demand. A large majority of payments to walnut growers were completed in the third quarter of fiscal 2026. Remaining amounts to be paid to walnut growers as of March 26, 2026 are final and are not subject to revision. We decreased our walnut grower liability by approximately $2.8 million during the third quarter of fiscal 2026, as the final payments due to walnut growers are slightly less than the amounts estimated at the end of the second quarter. This decrease is insignificant compared to our total inshell walnut procurement costs for the year, and the portion of the adjustment to cost of sales was immaterial to our results of operations.