FDD Talk 2013: Average Net Revenue and Cash Flow Margin of Specified Traditional and Non-Traditional Jamba Juice Stores (2013 FDD)

Highlights of Jamba Juice’s Item 19 Financial Performance Representations (2013 FDD)

• The following three tables present unaudited information about (a) the actual Revenue of franchised and franchisor-owned Jamba Juice Stores for Fiscal Year 2012, and (b) certain expenses and cash flow margin (earnings before depreciation and amortization, general and administrative expenses, store pre-opening expenses, other operating expenses, and formation and operating costs) of certain franchisor-owned Jamba Juice Stores for Fiscal Year 2012.

Explanatory Notes for Table 1 (Net Revenue of Specified Traditional Stores by Quartile for Fiscal Year 2012) and Table 2 (Net Revenue of Specified Non-Traditional Stores by Quartile for Fiscal Year 2012)

• In Table 1, Revenue is provided separately for Traditional Stores (“Specified Traditional Stores”). The franchisor-owned store information included in Table 1 is based on reports of 279 Specified Traditional Stores that were owned and operated  by Jamba Juice for the entire Fiscal Year 2012 (i.e. it does not include stores sold to or acquired from franchisees) and had been opened and operating for more than one year as of January 1, 2013 (“Specified Company Traditional Stores”).

• The franchised store information included in Table 1 below is based on reports of 287 Specified Traditional Stores that were owned and operated by franchisees as of January 1, 2013, and had been opened and operating for more than one year as of January 1, 2013 (“Specified Franchise Traditional Stores”). The Specified System Traditional Store information in Table 1 reflects 566 Specified Traditional Stores.

• In Table 2, Revenue is provided separately for Non-Traditional Stores (“Specified Non-Traditional Stores”). The franchisor-owned store information included in Table 2 is based on reports of 21 Specified Non-Traditional Stores that were owned and operated  by Jamba Juice for the entire Fiscal Year 2012 (i.e. it does not include stores sold to or acquired from franchisees) and had been opened and operating for more than one year as of January 1, 2013 (“Specified Company Non-Traditional Stores”).

• The franchised store information included in Table 2 below is based on reports of 140 Specified Non-Traditional Stores that were owned and operated by franchisees as of January 1, 2013, and had been opened and operating for more than one year as of January 1, 2013 (“Specified Franchise Non-Traditional Stores”). The Specified System Non-Traditional Store information in Table 2 reflects 161 Specified Non-Traditional Stores.

• Jamba Juice selected Stores that were opened and operating for more than one year because, unlike other quick service, casual restaurants which open with higher initial “honeymoon” period Revenue, Jamba Juice Stores tend to open with lower sales volumes and build sales volumes over time, particularly in new markets.

• The Specified System Traditional Stores and Specified System Non-Traditional Stores are a subset of the 301 company-owned and 473  franchisee-owned Jamba Juice Stores operating on January 1, 2013.

• Approximately 96% of the Specified Company Traditional Stores are located in California where Jamba Juice has a significant presence, which means that the Net Revenue figure below may not be indicative of Net Revenue outside California. Approximately 82% of the Specified Franchise Traditional Stores are located outside of California.

• The median maturity (duration open and operating) of the Specified Company Traditional Stores and Specified Franchise Traditional Stores were 10.2 and 9.1 years respectively.

Explanatory Notes for Table 3 (Average Net Revenue and Cash Flow Margin of Specified Company Traditional and Non-Traditional Stores for Fiscal Year 2012)

• Cost of sales is mostly comprised of fruit, dairy, and other products used to make smoothies and juices, prepared foods, and paper products.

• Labor cost is comprised of store management salaries and bonuses, hourly team member payroll and training costs, and other payroll related items.

• Occupancy costs include both fixed and variable portions of rent, real estate taxes, property insurance, and common area maintenance charges.

• Store operating expenses consist primarily of various store-level costs such as repairs and maintenance, refurbishments, cleaning supplies, bank charges, utilities, and marketing.

• Historically, the cash flow margin of company-owned Jamba Juice Stores has generally ranged between 16% and 20%. The company attributes the Cash Flow Margin of Specified Company Traditional and Non-Traditional Stores for Fiscal Year 2012 to several factors, including the recession in the U.S. economy and less than optimal site selection.

•  A strategic priority for the company in 2013 is the continued discipline of expense reductions for company-owned Stores, focused on cost reductions in a number of areas, including labor savings from operational simplification, improved wage and benefit management, and improved management of controllable costs. Through the careful management of staffing levels, wages and benefits, and other controllable costs, franchisees also have the opportunity to control store level costs.

• The cash flow margin is earnings before depreciation and amortization, general and administrative expenses, some pre-opening expenses, other operating expense, and formation and operating costs.

Table 1 – Net Revenue of Specified Traditional Stores by Quartile for Fiscal Year 2012

System Traditional Stores Net Revenue Range

1st Quartile