news releases
PIZZA INN, INC.
-- Total domestic chain-wide comparable restaurant sales increased 3.8%
for the second quarter and 2.7% year-to-date compared to the comparable
periods in the prior fiscal year.
-- Comparable domestic buffet restaurant sales increased 5.2% for the
second quarter and 4.3% year-to-date compared to the comparable periods
in the prior fiscal year.
-- Four new domestic franchised buffet restaurants opened.
-- General and administrative expenses for the second quarter decreased
36% or $405,000 due primarily to lower payroll costs associated with
reductions in headcount and lower legal fees due to the settlement of
litigation in the prior fiscal year.
-- Income of $150,000 associated with the signing of master license
agreement in the country of Kuwait.
-- Income of $284,000 related to the settlement of litigation.
-- Interest expense decreased 100% or $274,000 compared to the same
quarter in the prior fiscal year due to the repayment of all
outstanding debt in December 2006.
As of the date of this press release, the Company has repurchased approximately 604,000 shares of its common stock under the 2007 Stock Purchase Plan approved by the Board of Directors in the fourth quarter of fiscal 2007.
Charlie Morrison, President and CEO, commented, "Our business continues to strengthen. Our same store sales growth momentum continues and reflects the investments made by our franchisees in their businesses. Our four new franchised buffet restaurants opened strong during the quarter and were a hit with customers in their markets. These openings and fewer restaurant closings contributed to positive overall domestic chain-wide sales growth for the first time in twelve quarters. We believe we have put the right team in place to restore a strong restaurant operating culture to Pizza Inn, led by our newly-appointed Vice President of Operations, Jason Daniel. Jason brings a wealth of experience to the table and is expected to ensure that we deliver the experience that Pizza Inn customers have come to expect over the past 50 years."
Certain statements in this press release, other than historical information, may be considered forward-looking statements, within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995, and are subject to various risks, uncertainties and assumptions. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may differ materially from those anticipated, estimated or expected. Among the key factors that may have a bearing on our operating results, performance or financial condition are our ability to implement our growth strategies, national, regional and local economic conditions affecting the restaurant/entertainment industry, competition within the restaurant and entertainment industries, sales cannibalization, the success of our franchise operations, negative publicity and fluctuations in results of operations, including those attributable to seasonality, government regulations, weather, commodity, insurance and labor costs.
Pizza Inn, Inc. (http://www.pizzainn.com/) is headquartered in The Colony, Texas, along with its distribution division, Norco Restaurant Services Company. Pizza Inn franchises approximately 340 restaurants and owns one restaurant with annual and domestic and international chain-wide sales of approximately $147 million.
Contact: Danny Meisenheimer VP of Brand Management Pizza Inn, Inc. 469-384-5000dmeisenheimer@pihq.com PIZZA INN, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per share amounts) (Unaudited) Three Months Ended Six Months Ended December December December December REVENUES: 23, 2007 24, 2006 23, 2007 24, 2006 Food and supply sales $11,174 $10,232 $21,953 $20,620 Franchise revenue 1,346 1,118 2,462 2,307 Restaurant sales 175 199 358 389 12,695 11,549 24,773 23,316 COSTS AND EXPENSES: Cost of sales 10,530 9,974 20,602 19,903 Franchise expenses 706 746 1,326 1,418 General and administrative expenses 721 1,126 1,356 2,675 Severance 79 - 379 - Bad debts 35 - 58 - Loss (gain) on sale of assets 7 (554) 7 (564) Other income - (146) - (179) (Recovery) provision for litigation costs (284) (108) (284) 302 Interest expense - 274 - 474 11,794 11,312 23,444 24,029 INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE TAXES 901 237 1,329 (713) Income taxes - - - - INCOME (LOSS) FROM CONTINUING OPERATIONS 901 237 1,329 (713) Income (loss) from discontinued operations, net of taxes (48) (85) (131) (196) NET INCOME (LOSS) $853 $152 $1,198 $(909) EARNINGS PER SHARE OF COMMON STOCK -- BASIC: Income (loss) from continuing operations $0.09 $0.02 $0.13 $(0.07) Income (loss) from discontinued operations $(0.01) $(0.01) $(0.01) $(0.02) Net income (loss) $0.08 $0.01 $0.12 $(0.09) EARNINGS PER SHARE OF COMMON STOCK -- DILUTED: Diluted income (loss) per common share Income (loss) from continuing operations $0.09 $0.02 $0.13 $(0.07) Income (loss) from discontinued operations $(0.01) $(0.01) $(0.01) $(0.02) Net income (loss) $0.08 $0.01 $0.12 $(0.09) Weighted average common shares outstanding -- basic 10,061 10,138 10,114 10,138 Weighted average common shares outstanding -- diluted 10,087 10,138 10,142 10,138 PIZZA INN, INC. CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (In thousands) Three Months Ended Six Months Ended December December December December 23, 2007 24, 2006 23, 2007 24, 2006 Net income (loss) $853 $152 $1,198 $(909) Interest rate swap (loss) gain -- (net of tax expense) - - - 14 Comprehensive income (loss) $853 $152 $1,198 $(895) PIZZA INN, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands, except share amounts) (Unaudited) December 23, June 24, ASSETS 2007 2007 CURRENT ASSETS Cash and cash equivalents $1,180 $1,879 Accounts receivable, less allowance for bad debts of $501 and $451, respectively 3,607 2,716 Notes receivable, current portion 9 8 Inventories 1,351 1,518 Property held for sale 331 336 Deferred income tax assets, net 458 458 Prepaid expenses and other assets 281 165 Total current assets 7,217 7,080 LONG-TERM ASSETS Property, plant and equipment, net 623 778 Notes receivable 9 12 Re-acquired development territory, net 142 239 Deposits and other assets 139 85 $8,130 $8,194 LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES Accounts payable -- trade $2,018 $2,082 Accrued expenses 1,520 1,805 Total current liabilities 3,538 3,887 LONG-TERM LIABILITIES Deferred gain on sale of property 197 209 Deferred revenues 297 314 Other long-term liabilities 8 7 Total liabilities 4,040 4,417 COMMITMENTS AND CONTINGENCIES SHAREHOLDERS' EQUITY Common stock, $.01 par value; authorized 26,000,000 shares; issued 15,123,909 and 15,120,319 shares, respectively; outstanding 9,858,977 and 10,168,494 shares, respectively 151 151 Additional paid-in capital 8,473 8,471 Retained earnings 15,996 14,799 Treasury stock at cost Shares in treasury: 5,264,932 and 4,951,825, respectively (20,530) (19,644) Total shareholders' equity 4,090 3,777 $8,130 $8,194 PIZZA INN, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) (Unaudited) Six Months Ended December 23, December 24, 2007 2006 CASH FLOWS FROM OPERATING ACTIVITIES: Net income (loss) $1,198 $(909) Adjustments to reconcile net income (loss) to cash provided (used) by operating activities: Depreciation and amortization 171 448 Severance expense 379 - Deferred rent expense - 3 Stock compensation expense 2 97 (Recovery) provision for litigation costs (284) 302 Loss (gain) on sale of assets 7 (564) Provision for bad debts 58 - Changes in operating assets and liabilities: Notes and accounts receivable (1,039) 118 Inventories 167 212 Deferred revenue (17) 196 Accounts payable -- trade (64) 626 Accrued expenses (363) (3,096) Prepaid expenses and other (51) (331) Cash provided (used) by operating activities 164 (2,898) CASH FLOWS FROM INVESTING ACTIVITIES: Proceeds from sale of assets 92 11,319 Capital expenditures (69) (248) Cash provided by investing activities 23 11,071 CASH FLOWS FROM FINANCING ACTIVITIES: Deferred financing costs - (26) Repayments of long-term bank debt - (8,044) Repurchase of common stock (886) - Cash used for financing activities (886) (8,070) Net (decrease) increase in cash and cash equivalents (699) 103 Cash and cash equivalents, beginning of period 1,879 184 Cash and cash equivalents, end of period $1,180 $287 PIZZA INN, INC. SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION (In thousands) (Unaudited) Six Months Ended December 23, December 24, 2007 2006 CASH PAYMENTS FOR: Interest $- $495 NON CASH FINANCING AND INVESTING ACTIVITIES: Capital lease obligations incurred Loss on interest rate swap $- $22
First Call Analyst:
FCMN Contact: mchandler@pihq.com
SOURCE: Pizza Inn, Inc.
CONTACT: Danny Meisenheimer, VP of Brand Management of Pizza Inn, Inc.,
+1-469-384-5000,
Web site: http://www.pizzainn.com/