THE COLONY, Texas, Feb. 9, 2010 (GLOBE NEWSWIRE) -- Pizza Inn, Inc. (Nasdaq:PZZI) today reported net income of $0.4 million, or $0.05 per share, for the fiscal quarter ended December 27, 2009, versus net income of $0.1 million, or $0.02 per share, for the same quarter of the prior fiscal year. Total revenue for the second fiscal quarter of 2010 declined to $10.4 million from $11.3 million in the same period of fiscal 2009.
Highlights for the second quarter of fiscal year 2010 included:
- Sales from Company-owned restaurants increased 34%, or $0.2 million, in the second quarter of fiscal 2010 compared to the same quarter of the prior fiscal year, primarily due to the opening of a new buffet location in Ft. Worth, Texas in September, 2009.
- Comparable domestic buffet restaurant sales decreased 6.3% for the second quarter of fiscal 2010 compared to the same quarter of the prior fiscal year.
- Chain-wide comparable domestic restaurant sales decreased 7.0% for the second quarter of fiscal 2010 compared to the same quarter of the prior fiscal year.
- Franchise revenue for the second quarter of fiscal 2010 was relatively flat to the same quarter of the prior fiscal year at $1.0 million despite the decline in same store sales due to the recognition of franchise fees from six new international openings during the current fiscal quarter compared to one new opening in the same quarter of the prior fiscal year.
- For the second consecutive fiscal quarter, there was positive net restaurant growth.
- Subsequent to quarter end, the Company entered into a Loan Agreement with Amegy National Bank that provides for a $2.0 million revolving facility and a $1.0 million term loan facility that provides growth capital for new company-owned restaurant expansion. The Company terminated the previous credit facility with CIT.
Charlie Morrison, President and CEO, commented, "Very few companies are exempt from pressures felt in the current economic environment. However, we remain encouraged by the positive net growth in the number of restaurants in the chain year-to-date and expect more openings in the coming months that will continue that trend. At the end of the second quarter, we have a pipeline of over 100 signed development agreements for new restaurants to be opened in both domestic and international markets over the coming years which we believe will further this developing trend of positive unit count growth."
Certain statements in this press release, other than historical information, may be considered forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, and are intended to be covered by the safe harbors created thereby. These forward-looking statements are based on current expectations that involve numerous risks, uncertainties and assumptions. Assumptions relating to these forward-looking statements involve judgments with respect to, among other things, future economic, competitive and market conditions, regulatory framework and future business decisions, all of which are difficult or impossible to predict accurately and many of which are beyond Pizza Inn's control. Although the assumptions underlying these forward-looking statements are believed to be reasonable, any of the assumptions could be inaccurate and, therefore, there can be no assurance that any forward-looking statements will prove to be accurate. In light of the significant uncertainties inherent in these forward-looking statements, the inclusion of such information should not be regarded as a representation that Pizza Inn's objectives and plans will be achieved.
Pizza Inn, Inc. (www.pizzainn.com) is an owner, franchisor and supplier of a system of restaurants operating domestically and internationally under the trademark "Pizza Inn." The Company and its distribution division, Norco Restaurant Services Company, are headquartered in The Colony, Texas. The Company's common stock is listed on the Nasdaq Capital Market under the symbol "PZZI."
The Pizza Inn logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=4933
| PIZZA INN, INC. | ||||
| CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||
| (In thousands, except per share amounts) | ||||
| (Unaudited) | ||||
| Three Months Ended | Six Months Ended | |||
| Dec. 27, | Dec. 28, | Dec. 27, | Dec. 28, | |
| REVENUES: | 2009 | 2008 | 2009 | 2008 |
| Food and supply sales | $8,616 | $9,645 | $17,011 | $19,779 |
| Franchise revenue | 1,004 | 1,044 | 2,066 | 2,108 |
| Restaurant sales | 791 | 589 | 1,334 | 779 |
| 10,411 | 11,278 | 20,411 | 22,666 | |
| COSTS AND EXPENSES: | ||||
| Cost of sales | 8,461 | 9,376 | 16,577 | 19,031 |
| Franchise expenses | 430 | 470 | 897 | 949 |
| General and administrative expenses | 838 | 856 | 1,615 | 1,543 |
| Severance | -- | -- | -- | 37 |
| Bad debt | 25 | 30 | 40 | 45 |
| Provision for litigation costs | -- | 263 | -- | 263 |
| Interest expense | 12 | 16 | 26 | 28 |
| 9,766 | 11,011 | 19,155 | 21,896 | |
| INCOME FROM CONTINUING OPERATIONS BEFORE TAXES | 645 | 267 | 1,256 | 770 |
| Income taxes | 217 | 74 | 423 | 235 |
| INCOME FROM CONTINUING OPERATIONS | 428 | 193 | 833 | 535 |
| Loss from discontinued operations, net of taxes | (41) | (57) | (80) | (106) |
| NET INCOME | $387 | $136 | $753 | $429 |
| EARNINGS PER SHARE OF COMMON STOCK - BASIC: | ||||
| Income from continuing operations | $0.05 | $0.02 | $0.10 | $0.06 |
| Loss from discontinued operations | -- | -- | (0.01) | (0.01) |
| Net income | $0.05 | $0.02 | $0.09 | $0.05 |
| EARNINGS PER SHARE OF COMMON STOCK - DILUTED: | ||||
| Income from continuing operations | $0.05 | $0.02 | $0.10 | $0.06 |
| Loss from discontinued operations | -- | -- | (0.01) | (0.01) |
| Net income | $0.05 | $0.02 | $0.09 | $0.05 |
| Weighted average common shares outstanding - basic | 8,011 | 8,713 | 8,011 | 8,827 |
|
Weighted average common and potential dilutive common shares outstanding |
8,011 | 8,713 | 8,011 | 8,832 |
| PIZZA INN, INC. | ||
| CONDENSED CONSOLIDATED BALANCE SHEETS | ||
| (In thousands, except share amounts) | ||
|
December 27, 2009 (unaudited) |
June 28, 2009 | |
| ASSETS | ||
| CURRENT ASSETS | ||
| Cash and cash equivalents | $77 | $274 |
|
Accounts receivable, less allowance for bad debts of $117 and $203, respectively |
3,170 | 2,559 |
| Income tax receivable | -- | 80 |
| Inventories | 1,686 | 1,371 |
| Property held for sale | 17 | 17 |
| Deferred income tax assets | 618 | 618 |
| Prepaid expenses and other | 411 | 233 |
| Total current assets | 5,979 | 5,152 |
| LONG-TERM ASSETS | ||
| Property, plant and equipment, net | 2,214 | 1,743 |
| Deferred income tax assets | 86 | 86 |
| Deposits and other | 131 | 81 |
| $8,410 | $7,062 | |
| LIABILITIES AND SHAREHOLDERS' EQUITY | ||
| CURRENT LIABILITIES | ||
| Accounts payable - trade | $1,980 | $1,806 |
| Deferred revenues | 283 | 132 |
| Accrued expenses | 1,205 | 1,009 |
| Total current liabilities | 3,468 | 2,947 |
| LONG-TERM LIABILITIES | ||
| Deferred gain on sale of property | 146 | 159 |
| Deferred revenues | 227 | 246 |
| Bank debt | 659 | 621 |
| Other long-term liabilities | 27 | 37 |
| Total liabilities | 4,527 | 4,010 |
| COMMITMENTS AND CONTINGENCIES | ||
| SHAREHOLDERS' EQUITY | ||
|
Common stock, $.01 par value; authorized 26,000,000 shares; issued 15,130,319 and 15,130,319 shares, respectively; outstanding 8,010,919 and 8,010,919 shares, respectively |
151 | 151 |
| Additional paid-in capital | 8,819 | 8,741 |
| Retained earnings | 19,549 | 18,796 |
| Treasury stock at cost | ||
| Shares in treasury: 7,119,400 and 7,119,400, respectively | (24,636) | (24,636) |
| Total shareholders' equity | 3,883 | 3,052 |
| $8,410 | $7,062 | |
| PIZZA INN, INC. | ||
| CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | ||
| (In thousands) | ||
| (Unaudited) | ||
| Six Months Ended | ||
| December 27, | December 28, | |
| 2009 | 2008 | |
| CASH FLOWS FROM OPERATING ACTIVITIES: | ||
| Net income | $753 | $429 |
|
Adjustments to reconcile net income to cash used for operating activities: |
||
| Depreciation and amortization | 164 | 143 |
| Stock compensation expense | 79 | 102 |
| Provision for litigation costs | -- | 263 |
| Provision for bad debts | 40 | 45 |
| Changes in operating assets and liabilities: | ||
| Notes and accounts receivable | (571) | (111) |
| Inventories | (315) | 81 |
| Accounts payable - trade | 172 | (790) |
| Accrued expenses | 196 | (486) |
| Deferred revenue | 119 | 28 |
| Prepaid expenses and other | (238) | -- |
| Cash provided (used) by operating activities | 399 | (296) |
| CASH FLOWS FROM INVESTING ACTIVITIES: | ||
| Capital expenditures | (634) | (832) |
| Cash used by investing activities | (634) | (832) |
| CASH FLOWS FROM FINANCING ACTIVITIES: | ||
| Change in line of credit, net | 38 | 992 |
| Cash overdraft | -- | 302 |
| Repurchase of common stock | -- | (1,173) |
| Cash provided by financing activities | 38 | 121 |
| Net decrease in cash and cash equivalents | (197) | (1,007) |
| Cash and cash equivalents, beginning of period | 274 | 1,157 |
| Cash and cash equivalents, end of period | $77 | $150 |