News

Rave Restaurant Group reports 6th quarter of growth for Pizza Inn, Pie Five struggles

September 27, 2018

Pie Five and Pizza Inn parent, Rave Restaurant Group, Inc. said its fourth-quarter results indicate comparable store retail sales increased 0.4 percent over last year, with Pizza Inn contributing a 2.5 percent comp sales increase. Pie Five, however, reported that comp sales dropped 6.4 percent over last year, a news release said. 

Other Q4 results include: 
•    Pizza Inn total domestic retail sales increased 0.3 percent.
•    Pie Five total system-wide retail sales decreased 10.7 percent.
•    Total revenue fell $2.5 million to $2.8 million in Q4 compared to $5.3 million Q4 2017. 
•    Net income grew $4.4 million to $3.3 million compared to a net loss of $1.1 million last year. 
•    Net income was $0.21 per share for the quarter compared to an $0.11 per share net loss last year.
•    Adjusted EBITDA of $0.3 million was $0.6 million over last year.

"We are encouraged by progress that we've made with both brands," Rave Restaurant Group CEO Scott Crane, said in the release. "The decisions made in fiscal 2018 have laid a solid foundation for success in coming quarters. 

"We are executing on key elements of our revitalization plans which are driving us towards the next phase of growth. Positive trends in comparable store retail sales point to a strong turnaround."

Pizza Inn added one unit domestically to a total of 153, while internationally, the brand lost two units to end the quarter at 58. Pie Five units dropped five units to end the quarter at 73.

"The fourth quarter of fiscal 2018 marked the sixth consecutive quarter of growth in comparable store retail sales for Pizza Inn," Rave President Bob Bafundo, said in the release. "We attribute the increased restaurant traffic and sales momentum to new initiatives such as online ordering, all-day buffet, and remodeled franchise locations. We believe this momentum is continuing in fiscal 2019.

"We are closely monitoring the effects of Hurricane Florence on our North Carolina and South Carolina stores but, despite weather challenges, we are optimistic about a seventh consecutive quarter of growth in Pizza Inn comparable store retail sales."

The company's net income of $1.9 million, or $0.13 per diluted share, in fiscal 2018 was an increase of $14.4 million, or $1.31 per diluted share, compared to the prior year. The improved net income was largely due to a $7.9 million improvement in company-owned stores related primarily to reductions in closed and non-operating store expenses and a $3.4 benefit from a partial reversal of the previous valuation allowance for net deferred tax assets.