Good morning, everyone, thank you for participating in today's conference call to discuss Coffee Holding Company's financial results for the fiscal third quarter ended July 31st, 2015. Joining us today is Coffee Holdings President and CEO, Andrew Gordon. Following his remarks, we will open the call for your questions. Before we go further, I would like to make the following remarks concerning forward-looking statements. All statements in this conference call, other than historical facts, are forward-looking statements. The words anticipate, believe, estimate, expect, intend, guidance, confidence, target, project, and other similar expressions typically are used to identify forward-looking statements.
These forward-looking statements are not guarantees of future performance and may involve and subject to risks, uncertainties, and other factors that may cause Coffee Holding Company's business, financial condition, and operating results, which include but are not limited to the risk factors and other qualifications contained in Coffee Holding Company's annual report on Form 10-K, quarterly reports on Form 10-Q, and other reports filed by Coffee Holding Company with the Securities and Exchange Commission to which your attention is directed. Therefore, actual outcomes and results may differ materially from what is expressed or implied by these forward-looking statements. Coffee Holding Company expressly disclaims any intent or obligation to update these forward-looking statements. I would like to remind everyone that this call is being recorded and will be available for replay through September 22nd, 2015, starting later today.
It will be accessible via the replay number provided in today's earnings release. With that, I will now turn the call over to the President and Chief Executive Officer of Coffee Holding Company, Mr. Andrew Gordon. Please go ahead, sir.
Thank you for my introduction. Good morning, everyone. As you saw yesterday evening, we issued a press release announcing the results for our fiscal third quarter ending July 31st, 2015. Our fiscal third quarter represents the first clean look at our core business without speculative trading activities. This is also our third consecutive quarter of year-over-year sales growth despite continued headwinds in the overall coffee market and commodity pricing. While the top line growth was modest, we returned to profitability as expected. Operationally, our three business segments remain strong with growth across specialty green coffee distribution and sales of private label and branded products.
Our new channels of distribution in the Texas market for our Café Caribe label and expected to continue growth in that market has now made this the second most important marketing area for us for our Café Caribe label, surpassing our distribution efforts in the Chicago Midwest market and trailing only our distribution in the New York, New Jersey, and Pennsylvania marketing areas. We also remain on target to hit our 2015 goal of 56.1 MMlb of coffee sold, which represents a 4% increase from 2014. Before commenting further on operations, I'd like to provide a quick overview of our business for newcomers to the Coffee Holding story as well as our financial results for the fiscal third quarter. Our business operates across three primary divisions: wholesale green coffee sales, private label, and branded products.
In our green coffee business, we sell unroasted green coffee beans to roasters and coffee shop operators of all sizes throughout the U.S., Australia, Canada, and China. Specialty coffee is widely considered the fastest-growing category in the coffee industry, and we have roughly 115 different high-end quality Arabica specialty coffee offerings for our over 300 accounts. In our private label business, we roast, blend, and package coffee for over 30 different private labels that wholesalers and retailers then sell as their own brands. It's an ideal service for grocers and retail stores that want to sell their own coffee label without entering the coffee manufacturing business. Our high-quality coffee enables these retail chains to provide coffee that's equivalent to major national brands at a lower price point. Finally, our branded coffee business.
This business includes five proprietary brands, most notably our flagship brand, Café Caribe, and two exclusive license agreements with Del Monte. This coffee is sold through grocery wholesalers and retail chains throughout the country as well as in the Asia-Pacific region. It's important to note that each brand has different price points and flavor profiles that target a particular consumer in the coffee market, leading to limited cannibalization amongst our own brands. Across our three business segments, our range of coffee flavor profiles and price points spanning the entire pricing spectrum make us one of the only coffee companies that's both vertically and horizontally integrated. Moving on to our financial results for the fiscal third quarter. Net sales increased approximately to approximately $27 million compared to approximately $26.6 million in the year-ago quarter.
As I mentioned earlier, the increase was driven by strong performance across our core business operations, including specialty green coffee distribution and increased sales of private label and branded products. It is also worth noting that we experienced this increase despite the fact that commodity prices of green coffee decreased nearly 75% when compared to a year-ago quarter. Gross profit in the third quarter was approximately $2 million compared to approximately $3.1 million in the year-ago quarter. The 2014 quarter includes gains from our trading activities, which we've since significantly pared back. Our selling, general, and administrative expenses in this fiscal third quarter total approximately $1.9 million compared to approximately $1.8 million in the year-ago quarter. As a percentage of revenues, SG&A was 7% compared to 6.8%.
Our net income in the fiscal third quarter was approximately $0.1 million or $0.02 per diluted share compared to net income of approximately $0.8 million or approximately $0.11 per diluted share in the year-ago quarter. The decline was due to gains from the aforementioned trading activities in the 2014 quarter. Excluding trading activities in both periods, our basic EPS was $0.05 per share in 2015 period compared to $0.08 per share in the year-ago quarter. At July 31st, 2015, our cash balance totaled approximately $3.3 million compared to approximately $3.8 million at October 31st, 2014. Total debt was approximately $4.3 million at July 31st, 2015, compared to approximately $2.5 million at October 31st, 2014. Turning back to our operations.
Just last month, we began selling our own single cup product line, which we manufacture through our joint venture, Generations Coffee Company LLC, to address the continued shift in consumer demand from packaged ground coffee to single cup product offerings. We do not expect this new initiative to affect any of our current wholesale client or partnership relationships. With this new product offering, we are solely targeting our current customer base and potential new customers, both of which we believe would otherwise purchase their single cup needs from other smaller third parties. We expect the single cup initiative to supplement our other revenues for growth in 2015. As I mentioned earlier, we've increased our distribution in the Texas market with one of the largest Hispanic populations in the country.
Given the strong Hispanic following of our Café Caribe brand, we'd expect our Café Caribe label to take market share as it has in the Northeast and Atlantic marketing region. We plan to further increase our marketing promotion efforts into next year to capitalize on the momentum we have achieved over the past several months. I remain confident that we have the tools in place to drive profitability through our operations and not rely on high commodity prices to drive results. As I've stated in the past, one of the key differentiations in our business that the flex falling commodity prices is the quality of our green coffee beans. We believe our high quality, rare specialty green coffee beans command premiums regardless of market conditions. Given the limited supply of these beans, we believe its dependency is much less reliant on macroeconomic variables.
We also continue to eliminate accounts and customers that have given us limited flexibility in our pricing. With regards to the acquisition landscape, we remain opportunistic and continue to target companies that can easily be integrated into our coffee platform and be accretive to our bottom line. Most importantly, we look for the best opportunities that could drive incremental value to our shareholders. For the remainder of 2015 and beyond, we expect to continue driving growth through our three core business operations and potential acquisitions. With that, I'd like to open up the call for your questions.
Thank you. At this time, we will conduct a question-and-answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the questioning queue. You may press star two if you would like to remove your question from the queue. Participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. Once again, that's star one to ask a question at this time. One moment while we poll for questions. Once again, to ask a question, that's star one on your telephone keypad. Our first question comes from Michael Solomon with Raymond James. Please proceed with your question.
Yes, thanks, Andy, for taking the call. My question is regarding the tea. You didn't mention any sales of the tea business. Can you tell us what's going on?
Yes, Michael. The tea business was rolled out in this quarter, and it is progressing a little slower than one would have hoped. Given the timing of the seasonal timing of it and trying to establish a new product line into customers when many are on vacation, we believe that the fourth quarter will see much greater results in this area.
Okay, thank you. You had mentioned, do you think the margins, the normalized margins for the business is gonna be like 12% based on?
I believe we should be looking at a total gross profit margin of roughly 10 to 11 points, yes. On the overall-
Okay.
On overall before SG&A.
Okay. Thank you. That's it for me.
Our next question comes from Chris Reynolds with Neuberger Berman. Please proceed with your question.
Hello. Thank you for taking my call. Just a general question about the private label business. It seems like that could be a category that could have above average growth, you know, given how expensive some of the premium coffee offerings like a Starbucks and others would be. Is that an opportunity and for more pricing and growth, or is that not an accurate observation?
It's a fairly accurate observation. We continue to view private label with, you know, optimism. As you and I have met in the past, and as I've mentioned to you, we look at opportunities and try to be selective. We're not willing to do business for anything less than our targeted margins, and that does, in some instances, limit who we can attempt to provide private label for. We've seen growth in this area, and we will be picking up new customers in this category for the fourth quarter.
Okay. Thank you.
Once again, to ask a question, that's star 1 on your telephone keypad. Our next question comes from Anthony Chiarenza with Key Equity Investor. Please proceed with your question.
Good morning. My question is on the trading program. I'm new to the company, and I wanna try to understand how you scaled it back. Previously, you were actually doing some speculative trading, and now you've gone down to more of a hedging program. Can you just provide some explanation, please?
I mean, that's a fairly accurate assessment. In the past, there would be positions out there which we felt would be opportunistic for us, you know, and to capitalize on market moves. Given that we've had, you know, 30 years plus experience in the business, we felt with the recent volatility in the green coffee market due to the change in the trading platform from open outcry to commodity algorithm and black box type business through the computers, we've scaled it back to more of a one-to-one correspondence business to hedges.
Okay. You don't anticipate any change to that? It's really just gonna be a hedging business to like lock in inventory or lock in spreads as you buy something and expect to sell it over the next few months or so.
Correct. Unless the market provides us a unique opportunity where we can acquire an additional inventory for at a much lower price than we that we believe that we could sell it at, we anticipate being a more of a one-to-one correspondence hedges to realize business.
Okay, great. That sounds good. The other thing is you're a little bit concentrated in terms of your sales. Is one of the main objective is to get more diversified? Again, if one customer is a significant amount of your sales.
Correct. Obviously, nobody likes concentration, but in this case, when you have a customer this big and who is, also has a certain, you know, panache in the market, we don't believe that this is a negative. Obviously, we would like to broaden our overall customer base to get this concentration less than 50%, and that is definitely an achievable goal over the next several months.
Okay. Thank you very much. Good luck.
Thank you.
At this time, I would like to turn the call back over to Mr. Andrew Gordon for closing comments.
Thank you. Thanks to everyone for joining the call. I wanna thank our hardworking team of employees, and we look forward to speaking with our investors when we report our fiscal fourth quarter results next year.
Thank you. This does conclude today's teleconference. You may disconnect your lines at this time and have a great day.