INDIANAPOLIS - Aug. 11, 2014 // PRNewswire // - Noble Roman's, Inc. (OTC/BB: NROM), the Indianapolis based franchisor and licensor of Noble Roman's Pizza and Tuscano's Italian Style Subs, today announced results for the quarterly period ended June 30, 2014.
Second Quarter 2014 Financial and Operational Highlights Compared to Second Quarter 2013
Financial and Operational Highlights for the First Six-Months in 2014 Compared to Comparable Period in 2013
The company continues to focus on growth in its three primary venues, which are non-traditional franchises/licenses other than grocery stores, the sale of take-n-bake pizzas through grocery deli departments and stand-alone take-n-bake franchised locations. The company anticipates continued growth in all three venues for the remainder of 2014 and future years while maintaining stable operating costs, as has been the company's history for the past several years.
"Interest in the grocery store take-n-bake locations has increased very significantly after displaying the new packaging and new products at the National Grocers Association show in February, the International Dairy-Deli Bakery Association show and the Food Marketing Institute show in June, and at various distributor food shows," said Paul Mobley, Chairman and CEO of Noble Roman's, Inc. "We are currently in ongoing discussions with a number of grocery store chains representing nearly 6,000 possible additional grocery store locations."
The grocery store take-n-bake pizzas are now displayed in bakeable, treated aluminum pans with a clear plastic top. Consumers bake the pizzas in these pans and the anodized treatment on the bottom is designed to increase home baking performance, drawing in more heat to make the pizzas crispy on the bottom but soft in the middle. The clear plastic top allows the entire pizza to be visible and appealing. The new products include a gluten-free crust designed to appeal to a growing segment of the population and three varieties of 14-inch mega-topped pizzas, designed for tremendous value appeal, which are called "Mile-High Extra Meat Pizza", "Extra Cheese Four Cheese Pizza" and "Double-Topped Pepperoni Pizza".
Mr. Mobley added, "The interest shown at these shows by larger grocery chains and some new distributors is a very positive sign for additional growth in this venue for the remainder of 2014 and even greater financial impact on 2015."
Thus far in 2014, the company has signed 24 additional new franchise/license agreements for non-traditional locations other than grocery stores and is in discussion with numerous other convenience store chains and entertainment facilities for additional non-traditional locations. The primary source of growth in this segment comes from existing franchisees and exhibiting in various industry trade shows including the National Association of Convenience Stores, Western Petroleum Marketers Association, International Association of Amusement Parks and Attractions, and selected state convenience store associations.
Mr. Mobley stated that "during the second quarter we signed agreements, with a chain of approximately 300 convenience stores, for six locations, all of which are to open in August and September of this year. The chain has targeted 21 additional locations which it intends to sign agreements for shortly after the six are opened with development continuing thereafter until they have put Noble Roman's Pizza in nearly all of their locations."
The company has entered into agreements for 61 stand-alone take-n-bake locations and is currently in discussions with several other prospects. The company continues to tightly screen all applicants for a stand-alone take-n-bake franchise and declines a high percentage of the applicants.
Mr. Mobley stated, "Our stand-alone take-n-bake development is still relatively new and we are continuing to look at further enhancements to improve sales and to make the operation even more appealing. During the second quarter we added an in-store baking service called 'You Bake or We Bake!' which is resulting in improved sales. In addition to broadening consumer appeal in general, this service has expanded our take-n-bake daypart earlier into the day, as we now offer hot pizzas and other menu items for lunch. The new baking service requires no substantial change in unit layouts, square footage or labor requirements, and can easily be incorporated into existing operations as well as new ones. Approximately 50% of existing franchises have added that service, others are considering adding the service and this service is part of the concept for all new locations going forward. Also, during the second quarter, we made the decision to focus our efforts on adding new locations in markets where existing franchises have already been sold to aid in market penetration for more affordable mass marketing efforts which should further increase unit volumes. Further enhancements to this venue will be ongoing. Our marketing initiatives to attract potential take-n-bake franchisees continues to be successful in generating a significant number of leads, however we are being highly selective in the approval process."
Current assets totaled $4.4 million and current liabilities totaled $2.1 million as of June 30, 2014 compared to total current assets of $3.5 million and current liabilities of $2.0 million as of December 31, 2013. Total bank debt was $3.2 million as of June 30, 2014 compared to $3.85 million as of December 31, 2013. Total stockholders' equity as of June 30, 2014 was $12.67 million compared to $11.70 million as of December 31, 2013.
Management provided the following revenue outlook for 2014 during its annual shareholder meeting.
The statements contained in this press release concerning the company's future revenues, profitability, financial resources, market demand and product development are forward-looking statements (as such term is defined in the Private Securities Litigation Reform Act of 1995) relating to the company that are based on the beliefs of the management of the company, as well as assumptions and estimates made by and information currently available to the company's management. The company's actual results in the future may differ materially from those projected in the forward-looking statements due to risks and uncertainties that exist in the company's operations and business environment, including, but not limited to, competitive factors and pricing pressures, non-renewal of franchise agreements, shifts in market demand, general economic conditions, changes in purchases of or demand for the company's products, licenses or franchises, the success or failure of individual franchisees and licensees, changes in prices or supplies of food ingredients and labor, and the success or failure of its recently developed stand-alone take-n-bake operation. Should one or more of these risks or uncertainties materialize, or should underlying assumptions or estimates prove incorrect, actual results may differ materially from those described herein as anticipated, believed, estimated, expected or intended. The company undertakes no obligations to update the information in this press release for subsequent events.
SOURCE Noble Roman's, Inc.
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