Strong Outlook for the Remainder of Fiscal 2015
Royalty Fees Increased 84.6% to $554,859
32 New Franchises Sold This Quarter
ST. AUGUSTINE, Fla. - February 18, 2015 - (BUSINESS WIRE) - Creative Learning Corporation (OTC: CLCN), owner and developer of Bricks 4 Kidz®, Challenge Island® and Sew Fun Studios®, the highly-popular children’s education and enrichment programs, today announced financial results for the first quarter of fiscal 2015 ending December 31, 2014.
Brian Pappas, CEO of Creative Learning, commented, "In just a few short years, we have grown the company to an impressive 700+ global franchises. The strength of our business model is best illustrated by our high margin, recurring royalty fees which increased 84.6% to $554,859 versus $300,652 for the first quarter of fiscal 2014. Our overall revenues were not as strong in the first quarter of fiscal 2015, compared to the same period last year, due to the fact that we sold an unusually high number of international franchises and master franchises in the first quarter of fiscal 2014. Nevertheless, our outlook for the business is extremely positive. We are projecting for the fiscal year ended September 30, 2015, to add a total of 15-20 franchises each month, which we expect should contribute a total of 180-240 new franchises for this fiscal year end, not including any new master franchise sales which could add significant upside."
"Our future growth will depend on the pace at which we grow Challenge Island® and Sew Fun Studios®. Our recurring royalties revenue stream will continue to increase, further enhancing our future profitability. Earlier this year, we formally launched Sew Fun Studios® after revamping the strategy to become a mobile business model, which has proven successful with Bricks 4 Kidz® and Challenge Island® by lowering the capital requirements for the franchisees. We are on track to open at least 15 Sew Fun Studios® franchises in fiscal 2015. At the same time, we continue to gain momentum with Challenge Island® and are on pace to add at least 40 new franchises and enter at least 3 new countries outside of the U.S. by the end of 2015. Finally, we anticipate adding 120-150 new Bricks 4 Kidz franchises this year and we expect to enter at least 5 new countries, bringing our total franchises sold to over 40 countries."
Revenue for the fiscal first quarter ended December 31, 2014 was $1.2 million versus $1.9 million for the fiscal first quarter ended December 31, 2013. The decrease in revenue was primarily the result of an unusually high number of international franchises and master franchises sold in the first quarter of fiscal 2014. Master franchise fees are generally in the six-figure range and add significant revenue over the typical franchise fee. Operating loss for the first quarter of fiscal 2015 was ($33,657) versus operating income of $474,021 for the first quarter of fiscal 2014. Net loss for the first quarter of fiscal 2015 was ($21,878) or $0.00 per diluted share, versus net income of $296,815 or $0.03 per diluted share for the first quarter of fiscal 2014.
Creative Learning Corporation, operating under the trade names of Bricks 4 Kidz®, Challenge Island®, and Sew Fun Studios® offers educational and enrichment programs to children ages 3-12+. Through a unique franchise business model that includes a proprietary curriculum and marketing strategies, plus a proprietary Franchise Marketing Tool (FMT), the Company provides a wide variety of programs designed to enhance students’ problem solving and critical thinking skills. Creative Learning Corp is now operating in 36 countries.
This press release may contain "forward-looking statements" that are made pursuant to the "safe harbor" provisions as defined within the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by words including "anticipates," "believes," "intends," "estimates," "projects" and similar expressions. These statements are based upon management's current expectations as of the date of this press release. Such forward-looking statements may include statements regarding the Company's future financial performance or results of operations, including expected revenue growth, cash flow growth, future expenses and other future or expected performances. The Company cautions readers there may be events in the future that the Company is not able to accurately predict or control and the information contained in the forward-looking statements is inherently uncertain and subject to a number of risks that could cause actual results to differ materially from those indicated in the forward-looking statements. Further information on these and other potential factors that could affect the Company's financial results is included in the Company's filings with the SEC.
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SOURCE Creative Learning Corporation
David Waldman
Crescendo Communications, LLC
212-671-1020, ext. 304
Natalya Rudman
Crescendo Communications, LLC
212-671-1020 ext. 304
clcn@crescendo-ir.com
BRICKS 4 KIDZ programs provide an extraordinary atmosphere for students to build unique creations, play games, and have loads of fun using LEGO(R) bricks.