Pizza Inn, Inc. (Nasdaq:PZZI) has reported net income of $0.4 million, or $0.05 per share, for the fiscal quarter ended December 26, 2010, versus net income of $0.4 million, or $0.05 per share, for the same quarter of the prior fiscal year on total revenue of $10.4 million for each of the fiscal quarters ended December 26, 2010 and December 27, 2009.
For the six months ended December 26, 2010, Company revenues were $21.0 million compared to $20.4 million for the same period in the prior fiscal year. Net income for the six months ended December 26, 2010 was $0.5 million, or $0.06 per share, compared to $0.8 million, or $0.09 per share, for the same period in the prior fiscal year. The decline in net income is primarily attributable to $0.3 million of depreciation expense associated with the closure of a company store opened prior to the rollout of the new buffet prototype.
Highlights for the second quarter of fiscal year 2011 included:
- Sales from Company-owned restaurants increased 20%, or $0.2 million, in the second quarter of fiscal 2011 compared to the same quarter of the prior fiscal year, primarily due to the opening of a new buffet location in Lewisville, Texas in December, 2010 and the acquisition of a delivery carryout location from a franchisee in September, 2010. The new buffet restaurant was the third such Company-owned location opened since September, 2009.
- Comparable domestic buffet restaurant sales decreased 2.2% for the second quarter of fiscal 2011 compared to the same quarter of the prior fiscal year.
- Chain-wide comparable domestic restaurant sales decreased 2.6% for the second quarter of fiscal 2011 compared to the same quarter of the prior fiscal year.
- The 0% First Year Royalty incentive program has resulted in seven buffet openings in the last six fiscal quarters, with an eighth buffet unit opened in the current quarter. Waived royalties under this incentive program were $58,000 for the second quarter of fiscal 2011 and $131,000 for the first six months of fiscal 2011. All of these new buffet units began or will begin paying royalties in fiscal year 2011 or 2012.
- Subsequent to quarter end, the Company entered into an amendment to its Loan Agreement with Amegy Bank that increased the term loan facility to $2.56 million, providing additional growth capital for continued Company-owned restaurant expansion.
Charlie Morrison, President and CEO, commented, “We successfully opened our fifth company store in December, the second opening of this fiscal year, and secured additional financing to continue with our growth plans. This, combined with openings of eight new buffet restaurants in the last 18 months across the US under our $0 First Year Royalty incentive program, continues to position us for future growth. Although we continue to face difficult commodity markets and price competition in our category, we expect to see continued improvement in same store sales for the balance of this fiscal year.”
Pizza Inn, Inc. 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.”