Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Dec. 23, 2018 | Jan. 31, 2019 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | RAVE RESTAURANT GROUP, INC. | |
Entity Central Index Key | 718,332 | |
Current Fiscal Year End Date | --06-30 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Ex Transition Period | false | |
Entity Common Stock, Shares Outstanding | 15,071,311 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Dec. 23, 2018 | |
Document Fiscal Year Focus | 2,019 | |
Document Fiscal Period Focus | Q2 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Dec. 23, 2018 | Dec. 24, 2017 | Dec. 23, 2018 | Dec. 24, 2017 | |
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) [Abstract] | ||||
REVENUES | $ 3,195 | $ 4,197 | $ 6,186 | $ 9,629 |
COSTS AND EXPENSES: | ||||
Cost of sales | 174 | 1,055 | 333 | 3,142 |
General and administrative expenses | 1,640 | 2,017 | 3,054 | 4,111 |
Franchise expenses | 892 | 743 | 1,953 | 1,344 |
Pre-opening expenses | 0 | (1) | 0 | 114 |
Gain on sale of assets | (350) | (166) | (354) | (165) |
Impairment of long-lived assets and other lease charges | 155 | 533 | 170 | 681 |
Bad debt | 171 | 89 | 195 | 213 |
Interest expense | 26 | 63 | 51 | 131 |
Depreciation and amortization expense | 126 | 288 | 265 | 600 |
Total costs and expenses | 2,834 | 4,621 | 5,667 | 10,171 |
INCOME/(LOSS) FROM CONTINUING OPERATIONS BEFORE TAXES | 361 | (424) | 519 | (542) |
Income tax expense/(benefit) | 129 | (27) | 179 | (14) |
INCOME/(LOSS) FROM CONTINUING OPERATIONS | 232 | (397) | 340 | (528) |
Loss from discontinued operations, net of taxes | 0 | (180) | 0 | (405) |
NET INCOME / (LOSS) | $ 232 | $ (577) | $ 340 | $ (933) |
INCOME / (LOSS) PER SHARE OF COMMON STOCK - BASIC: | ||||
Income / (loss) from continuing operations (in dollars per share) | $ 0.02 | $ (0.03) | $ 0.02 | $ (0.04) |
Loss from discontinued operations (in dollars per share) | 0 | (0.01) | 0 | (0.03) |
Net income / (loss) (in dollars per share) | 0.02 | (0.04) | 0.02 | (0.07) |
INCOME / (LOSS) PER SHARE OF COMMON STOCK - DILUTED: | ||||
Income / (loss) from continuing operations (in dollars per share) | 0.02 | (0.03) | 0.02 | (0.04) |
Loss from discontinued operations (in dollars per share) | 0 | (0.01) | 0 | (0.03) |
Net income / (loss) (in dollars per share) | $ 0.02 | $ (0.04) | $ 0.02 | $ (0.07) |
Weighted average common shares outstanding - basic (in shares) | 15,071 | 14,344 | 15,068 | 12,742 |
Weighted average common and potential dilutive common shares outstanding (in shares) | 15,904 | 14,344 | 15,901 | 12,742 |
CONSOLIDATED BALANCE SHEETS (Un
CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands | Dec. 23, 2018 | Jun. 24, 2018 | Dec. 24, 2017 | Jun. 25, 2017 |
CURRENT ASSETS | ||||
Cash and cash equivalents | $ 1,906 | $ 1,386 | $ 1,428 | $ 451 |
Accounts receivable, less allowance for bad debts of $164 and $158, respectively | 1,520 | 1,518 | ||
Other receivable | 0 | 300 | ||
Notes receivable, less allowance of bad debt of $186 and $0, respectively | 798 | 712 | ||
Inventories | 6 | 6 | ||
Income tax receivable | 0 | 5 | ||
Property held for sale | 496 | 539 | ||
Deferred contract charges | 28 | 0 | ||
Prepaid expenses and other | 410 | 273 | ||
Total current assets | 5,164 | 4,739 | ||
LONG-TERM ASSETS | ||||
Property, plant and equipment, net | 1,300 | 1,510 | ||
Intangible assets definite-lived, net | 203 | 212 | ||
Long-term notes receivable | 1,017 | 803 | ||
Deferred tax asset, net | 3,334 | 3,479 | ||
Long-term deferred contract charges | 189 | 0 | ||
Deposits and other | 243 | 243 | ||
Total assets | 11,450 | 10,986 | ||
CURRENT LIABILITIES | ||||
Accounts payable - trade | 285 | 421 | ||
Accounts payable - lease termination impairments | 488 | 353 | ||
Accrued expenses | 914 | 1,109 | ||
Deferred rent | 37 | 32 | ||
Deferred revenues | 267 | 65 | ||
Total current liabilities | 1,991 | 1,980 | ||
LONG-TERM LIABILITIES | ||||
Convertible notes | 1,574 | 1,562 | ||
Deferred rent, net of current portion | 415 | 433 | ||
Deferred revenues, net of current portion | 2,088 | 670 | ||
Other long-term liabilities | 51 | 42 | ||
Total liabilities | 6,119 | 4,687 | ||
COMMITMENTS AND CONTINGENCIES (SEE NOTE 3) | ||||
SHAREHOLDERS' EQUITY | ||||
Common stock, $.01 par value; authorized 26,000,000 shares; issued 22,190,515 and 22,166,674 shares, respectively; outstanding 15,071,311 and 15,047,470 shares, respectively | 222 | 222 | ||
Additional paid-in capital | 33,520 | 33,206 | ||
Accumulated deficit | (3,775) | (2,493) | ||
Treasury stock at cost Shares in treasury: 7,119,204 | (24,636) | (24,636) | ||
Total shareholders' equity | 5,331 | 6,299 | ||
Total liabilities and shareholders' equity | $ 11,450 | $ 10,986 |
CONSOLIDATED BALANCE SHEETS (_2
CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - USD ($) $ in Thousands | Dec. 23, 2018 | Jun. 24, 2018 |
CURRENT ASSETS | ||
Accounts receivable, allowance for bad debts | $ 164 | $ 158 |
Notes receivable, allowance for bad debts | $ 186 | $ 0 |
SHAREHOLDERS' EQUITY | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 26,000,000 | 26,000,000 |
Common stock, shares issued (in shares) | 22,190,515 | 22,166,674 |
Common stock, shares outstanding (in shares) | 15,071,311 | 15,047,470 |
Treasury stock at cost (in shares) | 7,119,204 | 7,119,204 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (Unaudited) - USD ($) $ in Thousands | Common Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Deficit [Member] | Treasury Stock [Member] | Total |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
ASC 606 cumulative adjustment | ASC 606 [Member] | $ 0 | $ 0 | $ (1,622) | $ 0 | $ (1,622) |
Beginning balance at Jun. 24, 2018 | $ 222 | 33,206 | (2,493) | $ (24,636) | $ 6,299 |
Beginning balance (in shares) at Jun. 24, 2018 | 15,047,000 | (7,119,000) | 15,047,470 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Stock compensation expense | $ 0 | 281 | 0 | $ 0 | $ 281 |
Issuance of common stock | $ 0 | 36 | 0 | $ 0 | 36 |
Issuance of common stock (in shares) | 24,000 | 0 | |||
Equity issue costs - ATM Offering | $ 0 | (3) | 0 | $ 0 | (3) |
Net income | 0 | 0 | 340 | 0 | 340 |
Ending balance at Dec. 23, 2018 | $ 222 | $ 33,520 | $ (3,775) | $ (24,636) | $ 5,331 |
Ending balance (in shares) at Dec. 23, 2018 | 15,071,000 | (7,119,000) | 15,071,311 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands | 6 Months Ended | |
Dec. 23, 2018 | Dec. 24, 2017 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income/(loss) | $ 340 | $ (933) |
Adjustments to reconcile net income/(loss) to cash provided by (used in) operating activities: | ||
Impairment of fixed assets and other assets | 170 | 681 |
Stock compensation expense | 281 | 19 |
Depreciation and amortization | 245 | 581 |
Amortization of intangible assets definite-lived | 20 | 19 |
Amortization of debt issue costs | 12 | 23 |
Gain/loss on the sale of assets | (354) | (165) |
Provision for bad debt (accounts receivable) | 6 | 213 |
Provision for bad debt (notes receivable) | 186 | 0 |
Changes in operating assets and liabilities: | ||
Accounts receivable | 268 | 1,376 |
Operating notes receivable | (200) | 0 |
Inventories | 0 | 60 |
Prepaid expenses, deposits and other, net | (137) | (150) |
Deferred revenue | (219) | (690) |
Accounts payable - trade | (136) | (2,770) |
Accounts payable - lease termination impairments | (35) | (897) |
Deferred tax assets | 145 | 0 |
Accrued expenses, deferred rent and other | (199) | (841) |
Cash provided by (used in) operating activities | 393 | (3,474) |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Proceeds from sale of assets | 140 | 939 |
Purchase of intangible assets definite-lived | 0 | (9) |
Capital expenditures | (46) | (421) |
Cash provided by investing activities | 94 | 509 |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Proceeds from sale of stock | 36 | 4,942 |
Expenses from sale of stock | (3) | 0 |
Net change in other debt | 0 | (1,000) |
Cash provided by financing activities | 33 | 3,942 |
Net increase in cash and cash equivalents | 520 | 977 |
Cash and cash equivalents, beginning of period | 1,386 | 451 |
Cash and cash equivalents, end of period | 1,906 | 1,428 |
CASH PAID FOR: | ||
Interest | 3 | 115 |
Income taxes | 145 | 48 |
Non-cash activities: | ||
Capital expenditures included in accounts payable | $ 0 | $ 125 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 6 Months Ended |
Dec. 23, 2018 | |
Summary of Significant Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | (1) Summary of Significant Accounting Policies Principles of Consolidation The consolidated financial statements include the accounts of the Company and its subsidiaries, all of which are wholly owned. All appropriate intercompany balances and transactions have been eliminated. Cash and Cash Equivalents The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. Fiscal Quarters The three and six month periods ended December 23, 2018 and December 24, 2017 each contained 13 weeks and 26 weeks, respectively. Use of Management Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires the Company’s management to make estimates and assumptions that affect its reported amounts of assets, liabilities, revenues, expenses and related disclosure of contingent liabilities. The Company bases its estimates on historical experience and other various assumptions that it believes are reasonable under the circumstances. Estimates and assumptions are reviewed periodically, and actual results could differ materially from estimates. Revenue Recognition Revenue is measured based on consideration specified in contracts with customers and excludes incentives and amounts collected on behalf of third parties, primarily sales tax. The Company recognizes revenue when it satisfies a performance obligation by transferring control over a product or service to a customer. Taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction, that are collected by the Company from a customer, are excluded from revenue. As further described below, revenue recognition in fiscal 2019 follows ASU 2016-08, “Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations (Reporting Revenue Gross versus Net)” and ASU 2016-10, “Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing.” Prior year revenue recognition follows ASU Topic 605, “Revenue Recognition.” The following describes principal activities, separated by major product or service, from which the Company generates its revenues: Restaurant Sales Revenue from restaurant sales is recognized when food and beverage products are sold in Company-owned restaurants. The Company reports revenue net of sales taxes collected from customers and remitted to governmental taxing authorities. Franchise Revenues Franchise revenues consist of 1) franchise royalties, 2) supplier and distributor incentive revenues, 3) franchise license fees, 4) area development exclusivity fees and foreign master license fees, 5) advertising funds, and 6) supplier convention funds. Franchise royalties, which are based on a percentage of franchise restaurant sales, are recognized as sales occur. Supplier and distributor incentive revenues are recognized when title to the underlying commodities transfer. Franchise license fees are typically billed upon execution of the franchise agreement and amortized over the term of the franchise agreement which can range from five to 20 years. Fees received for renewal periods are amortized over the life of the renewal period. Area development exclusivity fees and foreign master license fees are typically billed upon execution of the area development and foreign master license agreements. Area development exclusivity fees are included in deferred revenue in the Condensed Consolidated Balance Sheets and allocated on a pro rata basis to all stores opened under that specific development agreement. Area development exclusivity fees that include rights to subfranchise are amortized as revenue over the term of the contract. For periods prior to adoption of Topic 606, revenue was recognized when we performed our obligations related to such fees, primarily the store opening date for initial franchise fees and area development fees, or the date the renewal option was effective for renewal fees. Advertising fund contributions for Pie Five units represent contributions collected where we have control over the activities of the fund. Contributions are based on a percentage of net retail sales. The adoption of Topic 606 revises the determination of whether these arrangements are considered principal versus agent. For Pie Five, we have determined that we are the principal in these arrangements, and advertising fund contributions and expenditures are, therefore, reported on a gross basis in the Condensed Consolidated Statements of Income. In general, we expect such advertising fund contributions and expenditures to be largely offsetting and, therefore, do not expect a significant impact on our reported income before income taxes. Our obligation related to these funds is to develop and conduct advertising activities. Pie Five marketing fund contributions are billed and collected weekly. Supplier convention funds are deferred until the obligations of the agreement are met and the event takes place. Accounting Standards Adopted In May 2014, the Financial Accounting Standards Board (“FASB”) issued ASU 2014-09, “Revenue from Contracts with Customers” (“ASU 2014-09”), which supersedes nearly all existing revenue recognition guidance under GAAP, including industry-specific requirements, and provides companies with a single framework for recognizing revenue from contracts with customers. In March and April 2016, the FASB issued Topic 606. This update and subsequently issued amendments require companies to recognize revenue at amounts that reflect the consideration to which the companies expect to be entitled in exchange for those goods or services at the time of transfer. Topic 606 requires that we assess contracts to determine each separate and distinct performance obligation. If a contract has multiple performance obligations, we allocate the transaction price using our best estimate of the standalone selling price to each distinct good or service in the contract. The Company adopted Topic 606 as of June 25, 2018. See Note 2 for additional information. Stock-Based Compensation The Company accounts for stock options using the fair value recognition provisions of the authoritative guidance on share-based payments. The Company uses the Black-Scholes formula to estimate the value of stock-based compensation for options granted to employees and directors and expects to continue to use this acceptable option valuation model in the future. The authoritative guidance also requires the benefits of tax deductions in excess of recognized compensation cost to be reported as a financing cash flow. Restricted stock units (“RSU’s”) represent the right to receive shares of common stock upon the satisfaction of vesting requirements, performance criteria and other terms and conditions. Compensation cost for RSU’s is measured as an amount equal to the fair value of the RSU’s on the date of grant and is expensed over the vesting period if achievement of the performance criteria is deemed probable, with the amount of the expense recognized based on the best estimate of the ultimate achievement level. Discontinuation of Norco Distribution Division During the fiscal quarter ended December 24, 2017, the Company discontinued its Norco distribution division and revised its arrangements with third party suppliers and distributors of food, equipment and supplies. As a result, sale of food, equipment and supplies is no longer recognized as revenue and the cost of such items is no longer included in cost of sales. The Company now recognizes incentive revenues received from third party suppliers and distributors as revenue. |
Adoption of ASU 2014-09, "Reven
Adoption of ASU 2014-09, "Revenue from Contracts with Customers" | 6 Months Ended |
Dec. 23, 2018 | |
Adoption of ASU 2014-09, "Revenue from Contracts with Customers" [Abstract] | |
Adoption of ASU 2014-09, "Revenue from Contracts with Customers" | (2) Adoption of ASU 2014-09, “Revenue from Contracts with Customers” The Company adopted ASU 2014-09 and Topic 606 using the modified retrospective transition method effective June 25, 2018. Results for reporting periods beginning on or after June 25, 2018 are presented in accordance with Topic 606, while prior period amounts are not adjusted and continue to be reported in accordance with our historical accounting under Topic 605, “Revenue Recognition.” A cumulative effect adjustment of $1.6 million was recorded as a reduction to retained earnings as of June 25, 2018 to reflect the impact of adopting Topic 606. The reduction of retained earnings to reflect the cumulative impact of adopting Topic 606 was comprised of $1.3 million related to domestic franchise and renewal fees, $0.2 million related to domestic area development fees and $0.3 million related to international development and franchise master license fees, partially offset by $0.2 million in deferral of contract-related expenses. The impact of applying Topic 606 for the three months ended December 23, 2018, was an increase in revenues of $321 thousand and an increase in pre-tax income of $129 thousand. The impact of applying Topic 606 for the six months ended December 23, 2018, was an increase in revenues of $771 thousand and an increase in pre-tax income of $160 thousand. The adoption of Topic 606 did not impact the recognition and reporting of our two largest sources of revenue: franchise royalties and supplier and distributor incentives. The items impacted by the adoption include the timing of franchise and development revenue recognition and the presentation of advertising funds and supplier convention contributions. The following chart presents the specific line items impacted by the cumulative adjustment to opening retained earnings: (In thousands, except share amounts) As Reported June 24, 2018 Total Adjustment Adjusted Balance Sheet June 25, 2018 ASSETS CURRENT ASSETS Cash and cash equivalents $ 1,386 $ - $ 1,386 Accounts receivable, less allowance for bad debts of $158 1,518 - 1,518 Other receivable 300 - 300 Notes receivable 712 - 712 Inventories 6 - 6 Income tax receivable 5 - 5 Property held for sale 539 - 539 Deferred contract charges - 10 10 Prepaid expenses and other 273 - 273 Total current assets 4,739 10 4,749 LONG-TERM ASSETS Property, plant and equipment, net 1,510 - 1,510 Intangible assets definite-lived, net 212 - 212 Long-term notes receivable 803 - 803 Deferred tax asset, net 3,479 - 3,479 Long term deferred contract charges - 182 182 Deposits and other 243 - 243 Total assets $ 10,986 $ 192 $ 11,178 LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES Accounts payable - trade $ 421 $ - $ 421 Accounts payable - lease termination impairments 353 - 353 Accrued expenses 1,109 (4 ) 1,105 Deferred rent 32 - 32 Deferred revenues 65 243 308 Total current liabilities 1,980 239 2,219 LONG-TERM LIABILITIES Convertible notes 1,562 - 1,562 Deferred rent, net of current portion 433 - 433 Deferred revenues, net of current portion 670 1,575 2,245 Other long-term liabilities 42 - 42 Total liabilities 4,687 1,814 6,501 COMMITMENTS AND CONTINGENCIES (SEE NOTE 3) SHAREHOLDERS' EQUITY Common stock, $.01 par value; authorized 26,000,000 shares; issued 22,166,674 shares outstanding 15,047,470 shares 222 - 222 Additional paid-in capital 33,206 - 33,206 Accumulated deficit (2,493 ) (1,622 ) (4,115 ) Treasury stock at cost Shares in treasury: 7,119,204 (24,636 ) - (24,636 ) Total shareholders' equity 6,299 (1,622 ) 4,677 Total liabilities and shareholders' equity $ 10,986 $ 192 $ 11,178 See accompanying Notes to Unaudited Condensed Consolidated Financial Statements. The following charts present the specific line items impacted by the application of Topic 606 in the first two quarters of fiscal 2019. (In thousands, except share amounts) As Reported December 23, 2018 (Unaudited) Total Adjustment Balance Sheet Without Adoption of Topic 606 ASSETS CURRENT ASSETS Cash and cash equivalents $ 1,906 $ - $ 1,906 Accounts receivable, less allowance for bad debts of $179 1,520 - 1,520 Other receivable - - - Notes receivable 798 - 798 Inventories 6 - 6 Income tax receivable - - - Property held for sale 496 - 496 Deferred contract charges 28 (28 ) - Prepaid expenses and other 410 47 457 Total current assets 5,164 19 5,183 LONG-TERM ASSETS Property, plant and equipment, net 1,300 - 1,300 Intangible assets definite-lived, net 203 - 203 Long-term notes receivable 1,017 - 1,017 Deferred tax asset, net 3,334 - 3,334 Long term deferred contract charges 189 (189 ) - Deposits and other 243 - 243 Total assets $ 11,450 $ (170 ) $ 11,280 LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES Accounts payable - trade $ 285 $ - $ 285 Accounts payable - lease termination impairments 488 - 488 Accrued expenses 914 (3 ) 911 Deferred rent 37 - 37 Deferred revenues 267 (114 ) 153 Total current liabilities 1,991 (117 ) 1,874 LONG-TERM LIABILITIES Convertible notes 1,574 - 1,574 Deferred rent, net of current portion 415 - 415 Deferred revenues, net of current portion 2,088 (1,515 ) 573 Other long-term liabilities 51 - 51 Total liabilities 6,119 (1,632 ) 4,487 COMMITMENTS AND CONTINGENCIES (SEE NOTE 3) SHAREHOLDERS' EQUITY Common stock, $.01 par value; authorized 26,000,000 shares; issued 22,190,515 shares outstanding 15,071,311 shares 222 - 222 Additional paid-in capital 33,520 - 33,520 Accumulated deficit (3,775 ) 1,462 (2,313 ) Treasury stock at cost 0 - Shares in treasury: 7,119,204 (24,636 ) - (24,636 ) Total shareholders' equity 5,331 1,462 6,793 Total liabilities and shareholders' equity $ 11,450 $ (170 ) $ 11,280 See accompanying Notes to Unaudited Condensed Consolidated Financial Statements. As Reported Six Months Ended December 23, 2018 Total Adjustments Income Statement Without Adoption of Topic 606 REVENUES: $ 6,186 $ (771 ) $ 5,415 COSTS AND EXPENSES: Cost of sales 333 - 333 General and administrative expenses 3,054 - 3,054 Franchise expenses 1,953 (611 ) 1,342 Pre-opening expenses - - - Gain on sale of assets (354 ) - (354 ) Impairment of long-lived assets and other lease charges 170 - 170 Bad debt 195 - 195 Interest expense 51 - 51 Depreciation and amortization expense 265 - 265 Total costs and expenses 5,667 (611 ) 5,056 INCOME FROM CONTINUING OPERATIONS BEFORE TAXES 519 (160 ) 359 Income tax expense 179 - 179 INCOME FROM CONTINUING OPERATIONS 340 (160 ) 180 Loss from discontinued operations, net of taxes - - - NET INCOME $ 340 $ (160 ) $ 180 INCOME PER SHARE OF COMMON STOCK - BASIC: Income from continuing operations $ 0.02 $ (0.01 ) $ 0.01 Loss from discontinued operations - - - Net income $ 0.02 $ (0.01 ) $ 0.01 INCOME PER SHARE OF COMMON STOCK - DILUTED: Income from continuing operations $ 0.02 $ (0.01 ) $ 0.01 Loss from discontinued operations - - - Net income $ 0.02 $ (0.01 ) $ 0.01 Weighted average common shares outstanding - basic 15,068 15,068 15,068 Weighted average common and potential dilutive common shares outstanding 15,901 15,901 15,901 See accompanying Notes to Unaudited Condensed Consolidated Financial Statements. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Dec. 23, 2018 | |
Commitments and Contingencies [Abstract] | |
Commitments and Contingencies | (3) Commitments and Contingencies On May 23, 2007, the Company’s board of directors approved a stock purchase plan (the “2007 Stock Purchase Plan”) authorizing the purchase on our behalf of up to 1,016,000 shares of our common stock in the open market or in privately negotiated transactions. On June 2, 2008, the Company’s board of directors amended the 2007 Stock Purchase Plan to increase the number of shares of common stock the Company may repurchase by 1,000,000 shares to a total of 2,016,000 shares. On April 22, 2009 the Company’s board of directors amended the 2007 Stock Purchase Plan again to increase the number of shares of common stock the Company may repurchase by 1,000,000 shares to a total of 3,016,000 shares. The 2007 Stock Purchase Plan does not have an expiration date. There were no stock purchases in the fiscal quarter ended December 23, 2018. The Company is subject to various claims and contingencies related to employment agreements, franchise disputes, lawsuits, taxes, food product purchase contracts and other matters arising out of the normal course of business. Management believes that any such claims and actions currently pending are either covered by insurance or would not have a material adverse effect on the Company's annual results of operations or financial condition if decided in a manner that is unfavorable to the Company. |
Stock-Based Compensation
Stock-Based Compensation | 6 Months Ended |
Dec. 23, 2018 | |
Stock-Based Compensation [Abstract] | |
Stock-Based Compensation | (4) Stock-Based Compensation Stock Options: For the fiscal quarter ended December 23, 2018, the Company did not recognize any stock-based compensation expense related to stock options compared to $10 thousand in the same period of the prior year. As of December 23, 2018, there was no unamortized stock-based compensation expense related to stock options. The following table summarizes the number of shares of the Company’s common stock subject to outstanding stock options: Six Months Ended December 23, 2018 December 24, 2017 Shares Shares Outstanding at beginning of year 478,056 478,056 Granted - - Exercised - - Forfeited/Canceled/Expired (190,000 ) - Outstanding at end of period 288,056 478,056 Exercisable at end of Period 288,056 438,056 Restricted Stock Units: For the fiscal quarter ended December 23, 2018, the Company recognized $0.2 million in stock-based compensation expense related to RSU’s compared to no expense in the same period of the prior year. For the six month period ended December 23, 2018, the Company recognized $0.3 million in stock-based compensation expense related to RSU’s compared to no expense in the same period of the prior year. As of December 23, 2018, unamortized stock-based compensation expense related to RSU’s was $0.6 million. A summary of the status of restricted stock units as of December 23, 2018 and changes during the fiscal six month period then ended is presented below: Number of Restricted Stock Units Unvested at June 24, 2018 908,293 Granted - Vested - Forfeited (164,520 ) Unvested at December 23, 2018 743,773 |
Earnings per Share (EPS)
Earnings per Share (EPS) | 6 Months Ended |
Dec. 23, 2018 | |
Earnings per Share (EPS) [Abstract] | |
Earnings per Share (EPS) | (5) Earnings per Share (EPS) The following table shows the reconciliation of the numerator and denominator of the basic EPS calculation to the numerator and denominator of the diluted EPS calculation (in thousands, except per share amounts). Three Months Ended Six Months Ended December 23, 2018 December 24, 2017 December 23, 2018 December 24, 2017 Income/(loss) from continuing operations $ 232 $ (397 ) $ 340 $ (528 ) Loss from discontinued operations - (180 ) - (405 ) Net income/(loss) available to common stockholders $ 232 $ (577 ) $ 340 $ (933 ) Interest saved on convertible notes of $1,574 at 4% $ 16 $ - $ 31 $ - Adjusted net income/(loss) $ 248 $ (577 ) $ 371 $ (933 ) BASIC: Weighted average common shares 15,071 14,344 15,068 12,742 Income/(loss) from continuing operations per common share $ 0.02 $ (0.03 ) $ 0.02 $ (0.04 ) Loss from discontinued operations per common share - (0.01 ) - (0.03 ) Net income/(loss) per common share $ 0.02 $ (0.04 ) $ 0.02 $ (0.07 ) DILUTED: Weighted average common shares 15,071 14,344 15,068 12,742 Convertible notes 833 - 833 - Dilutive stock options - - - - Weighted average common shares outstanding 15,904 14,344 15,901 12,742 Income/(loss) from continuing operations per common share $ 0.02 $ (0.03 ) $ 0.02 $ (0.04 ) Loss from discontinued operations per common share - (0.01 ) - (0.03 ) Net income/(loss) per common share $ 0.02 $ (0.04 ) $ 0.02 $ (0.07 ) For the three and six month periods ended December 23, 2018, options to purchase 288,056 shares of common stock at exercise prices ranging from $1.55 to $13.11 were excluded from the computation of diluted EPS. |
Closed Restaurants and Disconti
Closed Restaurants and Discontinued Operations | 6 Months Ended |
Dec. 23, 2018 | |
Closed Restaurants and Discontinued Operations [Abstract] | |
Closed Restaurants and Discontinued Operations | (6) Closed restaurants and discontinued operations In April, 2014, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2014-08, “Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity,” which modifies the definition of discontinued operations to include only disposals of an entity that represent strategic shifts that have or will have a major effect on an entity’s operation and requires entities to disclose information about disposals of individually significant components that do not meet the definition of discontinued operations. The standard was effective prospectively for annual and interim periods beginning after December 15, 2014, with early adoption permitted. The authoritative guidance on “Accounting for the Impairment or Disposal of Long-Lived Assets,” requires that discontinued operations that meet certain criteria be reflected in the statement of operations after results of continuing operations as a net amount. This guidance also requires that the operations of closed restaurants, including any impairment charges, be reclassified to discontinued operations for all periods presented. The authoritative guidance on “Accounting for Costs Associated with Exit or Disposal Activities,” requires that a liability for a cost associated with an exit or disposal activity be recognized when the liability is incurred. This authoritative guidance also establishes that fair value is the objective for initial measurement of the liability. Discontinued operations include losses attributable to the discontinued Norco distribution and supply division, leased buildings associated with Company-owned restaurants closed in prior years, and Company-owned restaurants closed in the reported period. |
Income Taxes
Income Taxes | 6 Months Ended |
Dec. 23, 2018 | |
Income Taxes [Abstract] | |
Income Taxes | (7) Income Taxes For the three months ended December 23, 2018, the Company recorded an income tax expense of $129 thousand calculated at a rate consistent with the 21% statutory U.S. federal rate. For the three months ended December 23, 2018, income tax expense consisted of $1 thousand in state taxes and $128 thousand in deferred taxes. For the six months ended December 23, 2018, the Company recorded an income tax expense of $179 thousand calculated at a rate consistent with the 21% statutory U.S. federal rate. For the six months ended December 23, 2018, income tax expense consisted of $29 thousand in state taxes and $150 thousand in deferred taxes. The Company anticipates utilizing net operating loss carryforwards to offset any federal income taxes. The Company continually reviews the realizability of its deferred tax assets, including an analysis of factors such as future taxable income, reversal of existing taxable temporary differences, and tax planning strategies. Future sources of taxable income are also considered in determining the amount of the recorded valuation allowance. Based on the review of this evidence, the Company determined it was appropriate to reverse a portion of the valuation allowance against the deferred tax assets as of June 24, 2018. As of December 23, 2018, the Company had $5.7 million of gross deferred tax assets partially offset by a valuation allowance of $2.4 million. The Company determined it was not necessary to further adjust the valuation allowance. However, the Company will continue to review the need for an adjustment to the valuation allowance. |
Segment Reporting
Segment Reporting | 6 Months Ended |
Dec. 23, 2018 | |
Segment Reporting [Abstract] | |
Segment Reporting | (8) Segment Reporting The Company has three reportable operating segments as determined by management using the “management approach” as defined by the authoritative guidance on Disclosures about Segments of an Enterprise and Related Information: (1) Pizza Inn Franchising, (2) Pie Five Franchising and (3) Company-Owned Restaurants. These segments are a result of differences in the nature of the products and services sold. Corporate administration costs, which include, but are not limited to, general accounting, human resources, legal and credit and collections, are partially allocated to the three operating segments. Other revenue consists of non-recurring items. The Pizza Inn and Pie Five Franchising segments establish franchisees, licensees and territorial rights. Revenue for these segments is derived from franchise royalties, franchise fees, sale of area development and foreign master license rights and incentive payments from third party suppliers and distributors. Assets for these segments include equipment, furniture and fixtures. The Company-Owned Restaurant segment includes sales and operating results for all Company-owned restaurants. Assets for this segment include equipment, furniture and fixtures for the Company-owned restaurants. Corporate administration and other assets primarily include cash and short-term investments, as well as furniture and fixtures located at the corporate office and trademarks and other intangible assets. All assets are located within the United States. Summarized in the following table are net sales and operating revenues, depreciation and amortization expense and income from continuing operations before taxes for the Company's reportable segments as of the three and six months ended December 23, 2018 and December 24, 2017 (in thousands): Three Months Ended Six Months Ended December 23, 2018 December 24, 2017 December 23, 2018 December 24, 2017 Net sales and operating revenues: Pizza Inn Franchising $ 1,789 $ 1,718 $ 3,693 $ 3,492 Pie Five Franchising 1,283 912 2,246 2,395 Company-Owned Restaurants (1) 105 1,567 219 3,742 Interest income 18 - 28 - Consolidated revenues $ 3,195 $ 4,197 $ 6,186 $ 9,629 Depreciation and amortization: Pizza Inn Franchising $ - $ - $ - $ - Pie Five Franchising - - - - Company-Owned Restaurants (1) 31 173 62 373 Combined 31 173 62 373 Corporate administration and other (2) 95 115 203 227 Depreciation and amortization $ 126 $ 288 $ 265 $ 600 Income/(Loss) from continuing operations before taxes: Pizza Inn Franchising $ 1,426 $ 1,398 $ 2,773 $ 2,877 Pie Five Franchising 754 489 1,213 1,666 Company-Owned Restaurants (1) (295 ) (464 ) (424 ) (1,342 ) Combined 1,885 1,423 3,562 3,201 Corporate administration and other (1,524 ) (1,847 ) (3,043 ) (3,743 ) Income/(loss) from continuing operations before taxes $ 361 $ (424 ) $ 519 $ (542 ) Geographic information (revenues): United States $ 3,115 $ 3,983 $ 6,009 $ 9,336 Foreign countries 80 214 177 293 Consolidated total $ 3,195 $ 4,197 $ 6,186 $ 9,629 Notes: (1) Company stores that were closed are included in discontinued operations in the accompanying Condensed Consolidated Statement of Operations. (2) Portions of corporate administration and other have been allocated to segments. |
Convertible Notes
Convertible Notes | 6 Months Ended |
Dec. 23, 2018 | |
Convertible Notes [Abstract] | |
Convertible Notes | (9) Convertible Notes On March 3, 2017, the Company completed a registered shareholder rights offering of its 4% Convertible Senior Notes due 2022 (“Notes”). Shareholders exercised subscription rights to purchase all 30,000 of the Notes at the par value of $100 per Note, resulting in gross offering proceeds to the Company of $3.0 million. The Notes bear interest at the rate of 4% per annum on the principal or par value of $100 per Note, payable annually in arrears on February 15 of each year, commencing February 15, 2018. Interest is payable in cash or, at the Company’s discretion, in shares of Company common stock. The Notes mature on February 15, 2022, at which time all principal and unpaid interest will be payable in cash or, at the Company’s discretion, in shares of Company common stock. The Notes are secured by a pledge of all outstanding equity securities of the Company’s two primary direct operating subsidiaries. Noteholders may convert their Notes to common stock at a conversion rate of $2.00 per share, unless the Company sooner elects to redeem the notes. Accrued interest will be paid through the effective date of the conversion in cash or, at the Company’s sole discretion, in shares of Company common stock. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Dec. 23, 2018 | |
Summary of Significant Accounting Policies [Abstract] | |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements include the accounts of the Company and its subsidiaries, all of which are wholly owned. All appropriate intercompany balances and transactions have been eliminated. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. |
Fiscal Quarters | Fiscal Quarters The three and six month periods ended December 23, 2018 and December 24, 2017 each contained 13 weeks and 26 weeks, respectively. |
Use of Management Estimates | Use of Management Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires the Company’s management to make estimates and assumptions that affect its reported amounts of assets, liabilities, revenues, expenses and related disclosure of contingent liabilities. The Company bases its estimates on historical experience and other various assumptions that it believes are reasonable under the circumstances. Estimates and assumptions are reviewed periodically, and actual results could differ materially from estimates. |
Revenue Recognition | Revenue Recognition Revenue is measured based on consideration specified in contracts with customers and excludes incentives and amounts collected on behalf of third parties, primarily sales tax. The Company recognizes revenue when it satisfies a performance obligation by transferring control over a product or service to a customer. Taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction, that are collected by the Company from a customer, are excluded from revenue. As further described below, revenue recognition in fiscal 2019 follows ASU 2016-08, “Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations (Reporting Revenue Gross versus Net)” and ASU 2016-10, “Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing.” Prior year revenue recognition follows ASU Topic 605, “Revenue Recognition.” The following describes principal activities, separated by major product or service, from which the Company generates its revenues: Restaurant Sales Revenue from restaurant sales is recognized when food and beverage products are sold in Company-owned restaurants. The Company reports revenue net of sales taxes collected from customers and remitted to governmental taxing authorities. Franchise Revenues Franchise revenues consist of 1) franchise royalties, 2) supplier and distributor incentive revenues, 3) franchise license fees, 4) area development exclusivity fees and foreign master license fees, 5) advertising funds, and 6) supplier convention funds. Franchise royalties, which are based on a percentage of franchise restaurant sales, are recognized as sales occur. Supplier and distributor incentive revenues are recognized when title to the underlying commodities transfer. Franchise license fees are typically billed upon execution of the franchise agreement and amortized over the term of the franchise agreement which can range from five to 20 years. Fees received for renewal periods are amortized over the life of the renewal period. Area development exclusivity fees and foreign master license fees are typically billed upon execution of the area development and foreign master license agreements. Area development exclusivity fees are included in deferred revenue in the Condensed Consolidated Balance Sheets and allocated on a pro rata basis to all stores opened under that specific development agreement. Area development exclusivity fees that include rights to subfranchise are amortized as revenue over the term of the contract. For periods prior to adoption of Topic 606, revenue was recognized when we performed our obligations related to such fees, primarily the store opening date for initial franchise fees and area development fees, or the date the renewal option was effective for renewal fees. Advertising fund contributions for Pie Five units represent contributions collected where we have control over the activities of the fund. Contributions are based on a percentage of net retail sales. The adoption of Topic 606 revises the determination of whether these arrangements are considered principal versus agent. For Pie Five, we have determined that we are the principal in these arrangements, and advertising fund contributions and expenditures are, therefore, reported on a gross basis in the Condensed Consolidated Statements of Income. In general, we expect such advertising fund contributions and expenditures to be largely offsetting and, therefore, do not expect a significant impact on our reported income before income taxes. Our obligation related to these funds is to develop and conduct advertising activities. Pie Five marketing fund contributions are billed and collected weekly. Supplier convention funds are deferred until the obligations of the agreement are met and the event takes place. |
Accounting Standards Adopted | Accounting Standards Adopted In May 2014, the Financial Accounting Standards Board (“FASB”) issued ASU 2014-09, “Revenue from Contracts with Customers” (“ASU 2014-09”), which supersedes nearly all existing revenue recognition guidance under GAAP, including industry-specific requirements, and provides companies with a single framework for recognizing revenue from contracts with customers. In March and April 2016, the FASB issued Topic 606. This update and subsequently issued amendments require companies to recognize revenue at amounts that reflect the consideration to which the companies expect to be entitled in exchange for those goods or services at the time of transfer. Topic 606 requires that we assess contracts to determine each separate and distinct performance obligation. If a contract has multiple performance obligations, we allocate the transaction price using our best estimate of the standalone selling price to each distinct good or service in the contract. The Company adopted Topic 606 as of June 25, 2018. See Note 2 for additional information. |
Stock-Based Compensation | Stock-Based Compensation The Company accounts for stock options using the fair value recognition provisions of the authoritative guidance on share-based payments. The Company uses the Black-Scholes formula to estimate the value of stock-based compensation for options granted to employees and directors and expects to continue to use this acceptable option valuation model in the future. The authoritative guidance also requires the benefits of tax deductions in excess of recognized compensation cost to be reported as a financing cash flow. Restricted stock units (“RSU’s”) represent the right to receive shares of common stock upon the satisfaction of vesting requirements, performance criteria and other terms and conditions. Compensation cost for RSU’s is measured as an amount equal to the fair value of the RSU’s on the date of grant and is expensed over the vesting period if achievement of the performance criteria is deemed probable, with the amount of the expense recognized based on the best estimate of the ultimate achievement level. |
Discontinuation of Norco Distribution Division | Discontinuation of Norco Distribution Division During the fiscal quarter ended December 24, 2017, the Company discontinued its Norco distribution division and revised its arrangements with third party suppliers and distributors of food, equipment and supplies. As a result, sale of food, equipment and supplies is no longer recognized as revenue and the cost of such items is no longer included in cost of sales. The Company now recognizes incentive revenues received from third party suppliers and distributors as revenue. |
Adoption of ASU 2014-09, "Rev_2
Adoption of ASU 2014-09, "Revenue from Contracts with Customers" (Tables) | 6 Months Ended |
Dec. 23, 2018 | |
Adoption of ASU 2014-09, "Revenue from Contracts with Customers" [Abstract] | |
Line Items Impacted by Cumulative Adjustment from Adoption of New Accounting Standard | The following chart presents the specific line items impacted by the cumulative adjustment to opening retained earnings: (In thousands, except share amounts) As Reported June 24, 2018 Total Adjustment Adjusted Balance Sheet June 25, 2018 ASSETS CURRENT ASSETS Cash and cash equivalents $ 1,386 $ - $ 1,386 Accounts receivable, less allowance for bad debts of $158 1,518 - 1,518 Other receivable 300 - 300 Notes receivable 712 - 712 Inventories 6 - 6 Income tax receivable 5 - 5 Property held for sale 539 - 539 Deferred contract charges - 10 10 Prepaid expenses and other 273 - 273 Total current assets 4,739 10 4,749 LONG-TERM ASSETS Property, plant and equipment, net 1,510 - 1,510 Intangible assets definite-lived, net 212 - 212 Long-term notes receivable 803 - 803 Deferred tax asset, net 3,479 - 3,479 Long term deferred contract charges - 182 182 Deposits and other 243 - 243 Total assets $ 10,986 $ 192 $ 11,178 LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES Accounts payable - trade $ 421 $ - $ 421 Accounts payable - lease termination impairments 353 - 353 Accrued expenses 1,109 (4 ) 1,105 Deferred rent 32 - 32 Deferred revenues 65 243 308 Total current liabilities 1,980 239 2,219 LONG-TERM LIABILITIES Convertible notes 1,562 - 1,562 Deferred rent, net of current portion 433 - 433 Deferred revenues, net of current portion 670 1,575 2,245 Other long-term liabilities 42 - 42 Total liabilities 4,687 1,814 6,501 COMMITMENTS AND CONTINGENCIES (SEE NOTE 3) SHAREHOLDERS' EQUITY Common stock, $.01 par value; authorized 26,000,000 shares; issued 22,166,674 shares outstanding 15,047,470 shares 222 - 222 Additional paid-in capital 33,206 - 33,206 Accumulated deficit (2,493 ) (1,622 ) (4,115 ) Treasury stock at cost Shares in treasury: 7,119,204 (24,636 ) - (24,636 ) Total shareholders' equity 6,299 (1,622 ) 4,677 Total liabilities and shareholders' equity $ 10,986 $ 192 $ 11,178 See accompanying Notes to Unaudited Condensed Consolidated Financial Statements. The following charts present the specific line items impacted by the application of Topic 606 in the first two quarters of fiscal 2019. (In thousands, except share amounts) As Reported December 23, 2018 (Unaudited) Total Adjustment Balance Sheet Without Adoption of Topic 606 ASSETS CURRENT ASSETS Cash and cash equivalents $ 1,906 $ - $ 1,906 Accounts receivable, less allowance for bad debts of $179 1,520 - 1,520 Other receivable - - - Notes receivable 798 - 798 Inventories 6 - 6 Income tax receivable - - - Property held for sale 496 - 496 Deferred contract charges 28 (28 ) - Prepaid expenses and other 410 47 457 Total current assets 5,164 19 5,183 LONG-TERM ASSETS Property, plant and equipment, net 1,300 - 1,300 Intangible assets definite-lived, net 203 - 203 Long-term notes receivable 1,017 - 1,017 Deferred tax asset, net 3,334 - 3,334 Long term deferred contract charges 189 (189 ) - Deposits and other 243 - 243 Total assets $ 11,450 $ (170 ) $ 11,280 LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES Accounts payable - trade $ 285 $ - $ 285 Accounts payable - lease termination impairments 488 - 488 Accrued expenses 914 (3 ) 911 Deferred rent 37 - 37 Deferred revenues 267 (114 ) 153 Total current liabilities 1,991 (117 ) 1,874 LONG-TERM LIABILITIES Convertible notes 1,574 - 1,574 Deferred rent, net of current portion 415 - 415 Deferred revenues, net of current portion 2,088 (1,515 ) 573 Other long-term liabilities 51 - 51 Total liabilities 6,119 (1,632 ) 4,487 COMMITMENTS AND CONTINGENCIES (SEE NOTE 3) SHAREHOLDERS' EQUITY Common stock, $.01 par value; authorized 26,000,000 shares; issued 22,190,515 shares outstanding 15,071,311 shares 222 - 222 Additional paid-in capital 33,520 - 33,520 Accumulated deficit (3,775 ) 1,462 (2,313 ) Treasury stock at cost 0 - Shares in treasury: 7,119,204 (24,636 ) - (24,636 ) Total shareholders' equity 5,331 1,462 6,793 Total liabilities and shareholders' equity $ 11,450 $ (170 ) $ 11,280 See accompanying Notes to Unaudited Condensed Consolidated Financial Statements. As Reported Six Months Ended December 23, 2018 Total Adjustments Income Statement Without Adoption of Topic 606 REVENUES: $ 6,186 $ (771 ) $ 5,415 COSTS AND EXPENSES: Cost of sales 333 - 333 General and administrative expenses 3,054 - 3,054 Franchise expenses 1,953 (611 ) 1,342 Pre-opening expenses - - - Gain on sale of assets (354 ) - (354 ) Impairment of long-lived assets and other lease charges 170 - 170 Bad debt 195 - 195 Interest expense 51 - 51 Depreciation and amortization expense 265 - 265 Total costs and expenses 5,667 (611 ) 5,056 INCOME FROM CONTINUING OPERATIONS BEFORE TAXES 519 (160 ) 359 Income tax expense 179 - 179 INCOME FROM CONTINUING OPERATIONS 340 (160 ) 180 Loss from discontinued operations, net of taxes - - - NET INCOME $ 340 $ (160 ) $ 180 INCOME PER SHARE OF COMMON STOCK - BASIC: Income from continuing operations $ 0.02 $ (0.01 ) $ 0.01 Loss from discontinued operations - - - Net income $ 0.02 $ (0.01 ) $ 0.01 INCOME PER SHARE OF COMMON STOCK - DILUTED: Income from continuing operations $ 0.02 $ (0.01 ) $ 0.01 Loss from discontinued operations - - - Net income $ 0.02 $ (0.01 ) $ 0.01 Weighted average common shares outstanding - basic 15,068 15,068 15,068 Weighted average common and potential dilutive common shares outstanding 15,901 15,901 15,901 See accompanying Notes to Unaudited Condensed Consolidated Financial Statements. |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 6 Months Ended |
Dec. 23, 2018 | |
Stock-Based Compensation [Abstract] | |
Outstanding Stock Options | The following table summarizes the number of shares of the Company’s common stock subject to outstanding stock options: Six Months Ended December 23, 2018 December 24, 2017 Shares Shares Outstanding at beginning of year 478,056 478,056 Granted - - Exercised - - Forfeited/Canceled/Expired (190,000 ) - Outstanding at end of period 288,056 478,056 Exercisable at end of Period 288,056 438,056 |
Restricted Stock Units | A summary of the status of restricted stock units as of December 23, 2018 and changes during the fiscal six month period then ended is presented below: Number of Restricted Stock Units Unvested at June 24, 2018 908,293 Granted - Vested - Forfeited (164,520 ) Unvested at December 23, 2018 743,773 |
Earnings per Share (EPS) (Table
Earnings per Share (EPS) (Tables) | 6 Months Ended |
Dec. 23, 2018 | |
Earnings per Share (EPS) [Abstract] | |
Earnings per Share Basic and Diluted | The following table shows the reconciliation of the numerator and denominator of the basic EPS calculation to the numerator and denominator of the diluted EPS calculation (in thousands, except per share amounts). Three Months Ended Six Months Ended December 23, 2018 December 24, 2017 December 23, 2018 December 24, 2017 Income/(loss) from continuing operations $ 232 $ (397 ) $ 340 $ (528 ) Loss from discontinued operations - (180 ) - (405 ) Net income/(loss) available to common stockholders $ 232 $ (577 ) $ 340 $ (933 ) Interest saved on convertible notes of $1,574 at 4% $ 16 $ - $ 31 $ - Adjusted net income/(loss) $ 248 $ (577 ) $ 371 $ (933 ) BASIC: Weighted average common shares 15,071 14,344 15,068 12,742 Income/(loss) from continuing operations per common share $ 0.02 $ (0.03 ) $ 0.02 $ (0.04 ) Loss from discontinued operations per common share - (0.01 ) - (0.03 ) Net income/(loss) per common share $ 0.02 $ (0.04 ) $ 0.02 $ (0.07 ) DILUTED: Weighted average common shares 15,071 14,344 15,068 12,742 Convertible notes 833 - 833 - Dilutive stock options - - - - Weighted average common shares outstanding 15,904 14,344 15,901 12,742 Income/(loss) from continuing operations per common share $ 0.02 $ (0.03 ) $ 0.02 $ (0.04 ) Loss from discontinued operations per common share - (0.01 ) - (0.03 ) Net income/(loss) per common share $ 0.02 $ (0.04 ) $ 0.02 $ (0.07 ) |
Segment Reporting (Tables)
Segment Reporting (Tables) | 6 Months Ended |
Dec. 23, 2018 | |
Segment Reporting [Abstract] | |
Segment Reporting Information | Summarized in the following table are net sales and operating revenues, depreciation and amortization expense and income from continuing operations before taxes for the Company's reportable segments as of the three and six months ended December 23, 2018 and December 24, 2017 (in thousands): Three Months Ended Six Months Ended December 23, 2018 December 24, 2017 December 23, 2018 December 24, 2017 Net sales and operating revenues: Pizza Inn Franchising $ 1,789 $ 1,718 $ 3,693 $ 3,492 Pie Five Franchising 1,283 912 2,246 2,395 Company-Owned Restaurants (1) 105 1,567 219 3,742 Interest income 18 - 28 - Consolidated revenues $ 3,195 $ 4,197 $ 6,186 $ 9,629 Depreciation and amortization: Pizza Inn Franchising $ - $ - $ - $ - Pie Five Franchising - - - - Company-Owned Restaurants (1) 31 173 62 373 Combined 31 173 62 373 Corporate administration and other (2) 95 115 203 227 Depreciation and amortization $ 126 $ 288 $ 265 $ 600 Income/(Loss) from continuing operations before taxes: Pizza Inn Franchising $ 1,426 $ 1,398 $ 2,773 $ 2,877 Pie Five Franchising 754 489 1,213 1,666 Company-Owned Restaurants (1) (295 ) (464 ) (424 ) (1,342 ) Combined 1,885 1,423 3,562 3,201 Corporate administration and other (1,524 ) (1,847 ) (3,043 ) (3,743 ) Income/(loss) from continuing operations before taxes $ 361 $ (424 ) $ 519 $ (542 ) Geographic information (revenues): United States $ 3,115 $ 3,983 $ 6,009 $ 9,336 Foreign countries 80 214 177 293 Consolidated total $ 3,195 $ 4,197 $ 6,186 $ 9,629 Notes: (1) Company stores that were closed are included in discontinued operations in the accompanying Condensed Consolidated Statement of Operations. (2) Portions of corporate administration and other have been allocated to segments. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Details) | 6 Months Ended |
Dec. 23, 2018 | |
Minimum [Member] | |
Franchise Revenues [Abstract] | |
Amortization term of franchise license fees | 5 years |
Maximum [Member] | |
Franchise Revenues [Abstract] | |
Amortization term of franchise license fees | 20 years |
Adoption of ASU 2014-09, "Rev_3
Adoption of ASU 2014-09, "Revenue from Contracts with Customers", Cumulative Adjustment to Retained Earnings (Details) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Dec. 23, 2018USD ($)$ / sharesshares | Dec. 23, 2018USD ($)Source$ / sharesshares | Jun. 24, 2018USD ($)$ / sharesshares | Dec. 24, 2017USD ($) | Jun. 25, 2017USD ($) | |
CURRENT ASSETS [Abstract] | |||||
Cash and cash equivalents | $ 1,906 | $ 1,906 | $ 1,386 | $ 1,428 | $ 451 |
Accounts receivable, less allowance for bad debts of $164 and $158, respectively | 1,520 | 1,520 | 1,518 | ||
Other receivable | 0 | 0 | 300 | ||
Notes receivable | 798 | 798 | 712 | ||
Inventories | 6 | 6 | 6 | ||
Income tax receivable | 0 | 0 | 5 | ||
Property held for sale | 496 | 496 | 539 | ||
Deferred contract charges | 28 | 28 | 0 | ||
Prepaid expenses and other | 410 | 410 | 273 | ||
Total current assets | 5,164 | 5,164 | 4,739 | ||
LONG-TERM ASSETS [Abstract] | |||||
Property, plant and equipment, net | 1,300 | 1,300 | 1,510 | ||
Intangible assets definite-lived, net | 203 | 203 | 212 | ||
Long-term notes receivable | 1,017 | 1,017 | 803 | ||
Deferred tax asset, net | 3,334 | 3,334 | 3,479 | ||
Long term deferred contract charges | 189 | 189 | 0 | ||
Deposits and other | 243 | 243 | 243 | ||
Total assets | 11,450 | 11,450 | 10,986 | ||
CURRENT LIABILITIES [Abstract] | |||||
Accounts payable - trade | 285 | 285 | 421 | ||
Accounts payable - lease termination impairments | 488 | 488 | 353 | ||
Accrued expenses | 914 | 914 | 1,109 | ||
Deferred rent | 37 | 37 | 32 | ||
Deferred revenues | 267 | 267 | 65 | ||
Total current liabilities | 1,991 | 1,991 | 1,980 | ||
LONG-TERM LIABILITIES [Abstract] | |||||
Convertible notes | 1,574 | 1,574 | 1,562 | ||
Deferred rent, net of current portion | 415 | 415 | 433 | ||
Deferred revenues, net of current portion | 2,088 | 2,088 | 670 | ||
Other long-term liabilities | 51 | 51 | 42 | ||
Total liabilities | 6,119 | 6,119 | 4,687 | ||
COMMITMENTS AND CONTINGENCIES (SEE NOTE 3) | |||||
SHAREHOLDERS' EQUITY [Abstract] | |||||
Common stock | 222 | 222 | 222 | ||
Additional paid-in capital | 33,520 | 33,520 | 33,206 | ||
Accumulated deficit | (3,775) | (3,775) | (2,493) | ||
Treasury stock at cost Shares in treasury: 7,119,204 | (24,636) | (24,636) | (24,636) | ||
Total shareholders' equity | 5,331 | 5,331 | 6,299 | ||
Total liabilities and shareholders' equity | 11,450 | 11,450 | 10,986 | ||
Accounts receivable, allowance for bad debts | $ 164 | $ 164 | $ 158 | ||
Common stock, par value (in dollars per share) | $ / shares | $ 0.01 | $ 0.01 | $ 0.01 | ||
Common stock, shares authorized (in shares) | shares | 26,000,000 | 26,000,000 | 26,000,000 | ||
Common stock, shares issued (in shares) | shares | 22,190,515 | 22,190,515 | 22,166,674 | ||
Common stock, shares outstanding (in shares) | shares | 15,071,311 | 15,071,311 | 15,047,470 | ||
Treasury stock at cost (in shares) | shares | 7,119,204 | 7,119,204 | 7,119,204 | ||
ASU 2014-09 [Member] | |||||
Adoption of Cumulative Effect on Change in Accounting Principle [Abstract] | |||||
Cumulative adjustment recorded as reduction to retained earnings | $ (1,622) | ||||
Increase in revenue | $ 321 | $ 771 | |||
Increase in pre-tax income | 129 | $ 160 | |||
Number of largest sources of revenue | Source | 2 | ||||
ASU 2014-09 [Member] | Domestic Franchise and Renewal Fees [Member] | |||||
Adoption of Cumulative Effect on Change in Accounting Principle [Abstract] | |||||
Cumulative adjustment recorded as reduction to retained earnings | (1,300) | ||||
ASU 2014-09 [Member] | Domestic Area Development Fees [Member] | |||||
Adoption of Cumulative Effect on Change in Accounting Principle [Abstract] | |||||
Cumulative adjustment recorded as reduction to retained earnings | (200) | ||||
ASU 2014-09 [Member] | International Development and Franchise Master License Fees [Member] | |||||
Adoption of Cumulative Effect on Change in Accounting Principle [Abstract] | |||||
Cumulative adjustment recorded as reduction to retained earnings | (300) | ||||
Deferral of contract-related expenses | 200 | ||||
ASU 2014-09 [Member] | Adjustment [Member] | |||||
CURRENT ASSETS [Abstract] | |||||
Cash and cash equivalents | 0 | $ 0 | 0 | ||
Accounts receivable, less allowance for bad debts of $164 and $158, respectively | 0 | 0 | 0 | ||
Other receivable | 0 | 0 | 0 | ||
Notes receivable | 0 | 0 | 0 | ||
Inventories | 0 | 0 | 0 | ||
Income tax receivable | 0 | 0 | 0 | ||
Property held for sale | 0 | 0 | 0 | ||
Deferred contract charges | (28) | (28) | 10 | ||
Prepaid expenses and other | 47 | 47 | 0 | ||
Total current assets | 19 | 19 | 10 | ||
LONG-TERM ASSETS [Abstract] | |||||
Property, plant and equipment, net | 0 | 0 | 0 | ||
Intangible assets definite-lived, net | 0 | 0 | 0 | ||
Long-term notes receivable | 0 | 0 | 0 | ||
Deferred tax asset, net | 0 | 0 | 0 | ||
Long term deferred contract charges | (189) | (189) | 182 | ||
Deposits and other | 0 | 0 | 0 | ||
Total assets | (170) | (170) | 192 | ||
CURRENT LIABILITIES [Abstract] | |||||
Accounts payable - trade | 0 | 0 | 0 | ||
Accounts payable - lease termination impairments | 0 | 0 | 0 | ||
Accrued expenses | (3) | (3) | (4) | ||
Deferred rent | 0 | 0 | 0 | ||
Deferred revenues | (114) | (114) | 243 | ||
Total current liabilities | (117) | (117) | 239 | ||
LONG-TERM LIABILITIES [Abstract] | |||||
Convertible notes | 0 | 0 | 0 | ||
Deferred rent, net of current portion | 0 | 0 | 0 | ||
Deferred revenues, net of current portion | (1,515) | (1,515) | 1,575 | ||
Other long-term liabilities | 0 | 0 | 0 | ||
Total liabilities | (1,632) | (1,632) | 1,814 | ||
COMMITMENTS AND CONTINGENCIES (SEE NOTE 3) | |||||
SHAREHOLDERS' EQUITY [Abstract] | |||||
Common stock | 0 | 0 | 0 | ||
Additional paid-in capital | 0 | 0 | 0 | ||
Accumulated deficit | 1,462 | 1,462 | (1,622) | ||
Treasury stock at cost Shares in treasury: 7,119,204 | 0 | 0 | 0 | ||
Total shareholders' equity | 1,462 | 1,462 | (1,622) | ||
Total liabilities and shareholders' equity | (170) | (170) | 192 | ||
ASU 2014-09 [Member] | Without Adjustment [Member] | |||||
CURRENT ASSETS [Abstract] | |||||
Cash and cash equivalents | 1,906 | 1,906 | 1,386 | ||
Accounts receivable, less allowance for bad debts of $164 and $158, respectively | 1,520 | 1,520 | 1,518 | ||
Other receivable | 0 | 0 | 300 | ||
Notes receivable | 798 | 798 | 712 | ||
Inventories | 6 | 6 | 6 | ||
Income tax receivable | 0 | 0 | 5 | ||
Property held for sale | 496 | 496 | 539 | ||
Deferred contract charges | 0 | 0 | 10 | ||
Prepaid expenses and other | 457 | 457 | 273 | ||
Total current assets | 5,183 | 5,183 | 4,749 | ||
LONG-TERM ASSETS [Abstract] | |||||
Property, plant and equipment, net | 1,300 | 1,300 | 1,510 | ||
Intangible assets definite-lived, net | 203 | 203 | 212 | ||
Long-term notes receivable | 1,017 | 1,017 | 803 | ||
Deferred tax asset, net | 3,334 | 3,334 | 3,479 | ||
Long term deferred contract charges | 0 | 0 | 182 | ||
Deposits and other | 243 | 243 | 243 | ||
Total assets | 11,280 | 11,280 | 11,178 | ||
CURRENT LIABILITIES [Abstract] | |||||
Accounts payable - trade | 285 | 285 | 421 | ||
Accounts payable - lease termination impairments | 488 | 488 | 353 | ||
Accrued expenses | 911 | 911 | 1,105 | ||
Deferred rent | 37 | 37 | 32 | ||
Deferred revenues | 153 | 153 | 308 | ||
Total current liabilities | 1,874 | 1,874 | 2,219 | ||
LONG-TERM LIABILITIES [Abstract] | |||||
Convertible notes | 1,574 | 1,574 | 1,562 | ||
Deferred rent, net of current portion | 415 | 415 | 433 | ||
Deferred revenues, net of current portion | 573 | 573 | 2,245 | ||
Other long-term liabilities | 51 | 51 | 42 | ||
Total liabilities | 4,487 | 4,487 | 6,501 | ||
COMMITMENTS AND CONTINGENCIES (SEE NOTE 3) | |||||
SHAREHOLDERS' EQUITY [Abstract] | |||||
Common stock | 222 | 222 | 222 | ||
Additional paid-in capital | 33,520 | 33,520 | 33,206 | ||
Accumulated deficit | (2,313) | (2,313) | (4,115) | ||
Treasury stock at cost Shares in treasury: 7,119,204 | (24,636) | (24,636) | (24,636) | ||
Total shareholders' equity | 6,793 | 6,793 | 4,677 | ||
Total liabilities and shareholders' equity | $ 11,280 | $ 11,280 | $ 11,178 |
Adoption of ASU 2014-09, "Rev_4
Adoption of ASU 2014-09, "Revenue from Contracts with Customers", Statement of Operations (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Dec. 23, 2018 | Dec. 24, 2017 | Dec. 23, 2018 | Dec. 24, 2017 | |
Income Statement [Abstract] | ||||
REVENUES | $ 3,195 | $ 4,197 | $ 6,186 | $ 9,629 |
COSTS AND EXPENSES [Abstract] | ||||
Cost of sales | 174 | 1,055 | 333 | 3,142 |
General and administrative expenses | 1,640 | 2,017 | 3,054 | 4,111 |
Franchise expenses | 892 | 743 | 1,953 | 1,344 |
Pre-opening expenses | 0 | (1) | 0 | 114 |
Gain on sale of assets | (350) | (166) | (354) | (165) |
Impairment of long-lived assets and other lease charges | 155 | 533 | 170 | 681 |
Bad debt | 171 | 89 | 195 | 213 |
Interest expense | 26 | 63 | 51 | 131 |
Depreciation and amortization expense | 126 | 288 | 265 | 600 |
Total costs and expenses | 2,834 | 4,621 | 5,667 | 10,171 |
INCOME/(LOSS) FROM CONTINUING OPERATIONS BEFORE TAXES | 361 | (424) | 519 | (542) |
Income tax expense | 129 | (27) | 179 | (14) |
INCOME/(LOSS) FROM CONTINUING OPERATIONS | 232 | (397) | 340 | (528) |
Loss from discontinued operations, net of taxes | 0 | (180) | 0 | (405) |
NET INCOME / (LOSS) | $ 232 | $ (577) | $ 340 | $ (933) |
INCOME PER SHARE OF COMMON STOCK - BASIC [Abstract] | ||||
Income from continuing operations (in dollars per share) | $ 0.02 | $ (0.03) | $ 0.02 | $ (0.04) |
Loss from discontinued operations (in dollars per share) | 0 | (0.01) | 0 | (0.03) |
Net income / (loss) (in dollars per share) | 0.02 | (0.04) | 0.02 | (0.07) |
INCOME PER SHARE OF COMMON STOCK - DILUTED [Abstract] | ||||
Income from continuing operations (in dollars per share) | 0.02 | (0.03) | 0.02 | (0.04) |
Loss from discontinued operations (in dollars per share) | 0 | (0.01) | 0 | (0.03) |
Net income / (loss) (in dollars per share) | $ 0.02 | $ (0.04) | $ 0.02 | $ (0.07) |
Weighted average common shares outstanding - basic (in shares) | 15,071 | 14,344 | 15,068 | 12,742 |
Weighted average common and potential dilutive common shares outstanding (in shares) | 15,904 | 14,344 | 15,901 | 12,742 |
Adjustment [Member] | ASU 2014-09 [Member] | ||||
Income Statement [Abstract] | ||||
REVENUES | $ (771) | |||
COSTS AND EXPENSES [Abstract] | ||||
Cost of sales | 0 | |||
General and administrative expenses | 0 | |||
Franchise expenses | (611) | |||
Pre-opening expenses | 0 | |||
Gain on sale of assets | 0 | |||
Impairment of long-lived assets and other lease charges | 0 | |||
Bad debt | 0 | |||
Interest expense | 0 | |||
Depreciation and amortization expense | 0 | |||
Total costs and expenses | (611) | |||
INCOME/(LOSS) FROM CONTINUING OPERATIONS BEFORE TAXES | (160) | |||
Income tax expense | 0 | |||
INCOME/(LOSS) FROM CONTINUING OPERATIONS | (160) | |||
Loss from discontinued operations, net of taxes | 0 | |||
NET INCOME / (LOSS) | $ (160) | |||
INCOME PER SHARE OF COMMON STOCK - BASIC [Abstract] | ||||
Income from continuing operations (in dollars per share) | $ (0.01) | |||
Loss from discontinued operations (in dollars per share) | 0 | |||
Net income / (loss) (in dollars per share) | (0.01) | |||
INCOME PER SHARE OF COMMON STOCK - DILUTED [Abstract] | ||||
Income from continuing operations (in dollars per share) | (0.01) | |||
Loss from discontinued operations (in dollars per share) | 0 | |||
Net income / (loss) (in dollars per share) | $ (0.01) | |||
Weighted average common shares outstanding - basic (in shares) | 15,068 | |||
Weighted average common and potential dilutive common shares outstanding (in shares) | 15,901 | |||
Without Adjustment [Member] | ASU 2014-09 [Member] | ||||
Income Statement [Abstract] | ||||
REVENUES | $ 5,415 | |||
COSTS AND EXPENSES [Abstract] | ||||
Cost of sales | 333 | |||
General and administrative expenses | 3,054 | |||
Franchise expenses | 1,342 | |||
Pre-opening expenses | 0 | |||
Gain on sale of assets | (354) | |||
Impairment of long-lived assets and other lease charges | 170 | |||
Bad debt | 195 | |||
Interest expense | 51 | |||
Depreciation and amortization expense | 265 | |||
Total costs and expenses | 5,056 | |||
INCOME/(LOSS) FROM CONTINUING OPERATIONS BEFORE TAXES | 359 | |||
Income tax expense | 179 | |||
INCOME/(LOSS) FROM CONTINUING OPERATIONS | 180 | |||
Loss from discontinued operations, net of taxes | 0 | |||
NET INCOME / (LOSS) | $ 180 | |||
INCOME PER SHARE OF COMMON STOCK - BASIC [Abstract] | ||||
Income from continuing operations (in dollars per share) | $ 0.01 | |||
Loss from discontinued operations (in dollars per share) | 0 | |||
Net income / (loss) (in dollars per share) | 0.01 | |||
INCOME PER SHARE OF COMMON STOCK - DILUTED [Abstract] | ||||
Income from continuing operations (in dollars per share) | 0.01 | |||
Loss from discontinued operations (in dollars per share) | 0 | |||
Net income / (loss) (in dollars per share) | $ 0.01 | |||
Weighted average common shares outstanding - basic (in shares) | 15,068 | |||
Weighted average common and potential dilutive common shares outstanding (in shares) | 15,901 |
Commitments and Contingencies (
Commitments and Contingencies (Details) - shares | Apr. 22, 2009 | Jun. 02, 2008 | Dec. 23, 2018 | May 23, 2007 |
Treasury Stock, Shares [Abstract] | ||||
Repurchase of shares common stock (in shares) | 0 | |||
2007 Stock Purchase Plan [Member] | ||||
Treasury Stock, Shares [Abstract] | ||||
Number of common stock shares authorized to purchase (in shares) | 1,016,000 | |||
Amended 2007 Stock Purchase Plan [Member] | ||||
Treasury Stock, Shares [Abstract] | ||||
Number of common stock shares authorized to purchase (in shares) | 3,016,000 | 2,016,000 | ||
Repurchase of shares common stock (in shares) | 1,000,000 | 1,000,000 |
Stock-Based Compensation (Detai
Stock-Based Compensation (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Dec. 23, 2018 | Dec. 24, 2017 | Dec. 23, 2018 | Dec. 24, 2017 | |
Summary of Restricted Stock Units [Roll Forward] | ||||
Stock-based compensation expense recognized | $ 281 | $ 19 | ||
Stock Options [Member] | ||||
Summary of Shares of Common Stock Subject to Outstanding Stock Options [Roll Forward] | ||||
Outstanding at beginning of year (in shares) | 478,056 | 478,056 | ||
Granted (in shares) | 0 | 0 | ||
Exercised (in shares) | 0 | 0 | ||
Forfeited/Canceled/Expired (in shares) | (190,000) | 0 | ||
Outstanding at end of period (in shares) | 288,056 | 478,056 | 288,056 | 478,056 |
Exercisable at end of Period (in shares) | 288,056 | 438,056 | 288,056 | 438,056 |
Summary of Restricted Stock Units [Roll Forward] | ||||
Stock-based compensation expense recognized | $ 0 | $ 10 | ||
Unamortized stock-based compensation expense | $ 0 | $ 0 | ||
Restricted Stock Units [Member] | ||||
Summary of Restricted Stock Units [Roll Forward] | ||||
Unvested Beginning Balance (in shares) | 908,293 | |||
Granted (in shares) | 0 | |||
Vested (in shares) | 0 | |||
Forfeited (in shares) | (164,520) | |||
Unvested Ending Balance (in shares) | 743,773 | 743,773 | ||
Stock-based compensation expense recognized | $ 200 | $ 0 | $ 300 | $ 0 |
Unamortized stock-based compensation expense other than options | $ 600 | $ 600 |
Earnings per Share (EPS) (Detai
Earnings per Share (EPS) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Dec. 23, 2018 | Dec. 24, 2017 | Dec. 23, 2018 | Dec. 24, 2017 | Jun. 24, 2018 | Mar. 03, 2017 | |
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | ||||||
Income/(loss) from continuing operations | $ 232 | $ (397) | $ 340 | $ (528) | ||
Loss from discontinued operations | 0 | (180) | 0 | (405) | ||
Net income/(loss) available to common stockholders | 232 | (577) | 340 | (933) | ||
Interest saved on convertible notes of $1,574 at 4% | 16 | 0 | 31 | 0 | ||
Adjusted net income/(loss) | $ 248 | $ (577) | $ 371 | $ (933) | ||
BASIC [Abstract] | ||||||
Weighted average common shares (in shares) | 15,071,000 | 14,344,000 | 15,068,000 | 12,742,000 | ||
Income/(loss) from continuing operations per common share (in dollars per share) | $ 0.02 | $ (0.03) | $ 0.02 | $ (0.04) | ||
Loss from discontinued operations per common share (in dollars per share) | 0 | (0.01) | 0 | (0.03) | ||
Net income / (loss) (in dollars per share) | $ 0.02 | $ (0.04) | $ 0.02 | $ (0.07) | ||
DILUTED [Abstract] | ||||||
Weighted average common shares (in shares) | 15,071,000 | 14,344,000 | 15,068,000 | 12,742,000 | ||
Convertible notes (in shares) | 833,000 | 0 | 833,000 | 0 | ||
Dilutive stock options (in shares) | 0 | 0 | 0 | 0 | ||
Weighted average common shares outstanding (in shares) | 15,904,000 | 14,344,000 | 15,901,000 | 12,742,000 | ||
Income/(loss) from continuing operations per common share (in dollars per share) | $ 0.02 | $ (0.03) | $ 0.02 | $ (0.04) | ||
Loss from discontinued operations per common share (in dollars per share) | 0 | (0.01) | 0 | (0.03) | ||
Net income / (loss) (in dollars per share) | $ 0.02 | $ (0.04) | $ 0.02 | $ (0.07) | ||
Convertible notes | $ 1,574 | $ 1,574 | $ 1,562 | |||
Convertible Senior Notes [Member] | ||||||
DILUTED [Abstract] | ||||||
Interest on convertible notes | 4.00% | 4.00% | 4.00% | |||
Stock Options [Member] | ||||||
Antidilutive Securities Excluded from Computation of Earnings per Share [Abstract] | ||||||
Options to purchase shares of common stock excluded from computation of diluted EPS (in shares) | 288,056 | 288,056 | ||||
Stock Options [Member] | Minimum [Member] | ||||||
Antidilutive Securities Excluded from Computation of Earnings per Share [Abstract] | ||||||
Options to purchase shares of common stock exercise price (in dollars per share) | $ 1.55 | $ 1.55 | ||||
Stock Options [Member] | Maximum [Member] | ||||||
Antidilutive Securities Excluded from Computation of Earnings per Share [Abstract] | ||||||
Options to purchase shares of common stock exercise price (in dollars per share) | $ 13.11 | $ 13.11 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Dec. 23, 2018 | Dec. 24, 2017 | Dec. 23, 2018 | Dec. 24, 2017 | |
Income Taxes [Abstract] | ||||
Income tax expense | $ 129 | $ (27) | $ 179 | $ (14) |
Federal statutory rate | 21.00% | 21.00% | ||
State tax expense | $ 1 | $ 29 | ||
Deferred taxes | 128 | 150 | ||
Gross deferred tax assets | 5,700 | 5,700 | ||
Deferred tax assets, valuation allowance | $ 2,400 | $ 2,400 |
Segment Reporting (Details)
Segment Reporting (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Dec. 23, 2018USD ($) | Dec. 24, 2017USD ($) | Dec. 23, 2018USD ($)Segment | Dec. 24, 2017USD ($) | ||
Segment Reporting [Abstract] | |||||
Number of reportable segments | Segment | 3 | ||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||
Consolidated revenues | $ 3,195 | $ 4,197 | $ 6,186 | $ 9,629 | |
Interest income | 18 | 0 | 28 | 0 | |
Depreciation and amortization | 126 | 288 | 265 | 600 | |
Income/(Loss) from continuing operations before taxes | 361 | (424) | 519 | (542) | |
Operating Segments [Member] | |||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||
Depreciation and amortization | 31 | 173 | 62 | 373 | |
Income/(Loss) from continuing operations before taxes | 1,885 | 1,423 | 3,562 | 3,201 | |
Corporate Administration and Other [Member] | |||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||
Depreciation and amortization | [1] | 95 | 115 | 203 | 227 |
Income/(Loss) from continuing operations before taxes | (1,524) | (1,847) | (3,043) | (3,743) | |
Reportable Geographical Components [Member] | United States [Member] | |||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||
Consolidated revenues | 3,115 | 3,983 | 6,009 | 9,336 | |
Reportable Geographical Components [Member] | Foreign Countries [Member] | |||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||
Consolidated revenues | 80 | 214 | 177 | 293 | |
Pizza Inn Franchising [Member] | Operating Segments [Member] | |||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||
Consolidated revenues | 1,789 | 1,718 | 3,693 | 3,492 | |
Depreciation and amortization | 0 | 0 | 0 | 0 | |
Income/(Loss) from continuing operations before taxes | 1,426 | 1,398 | 2,773 | 2,877 | |
Pie Five Franchising [Member] | Operating Segments [Member] | |||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||
Consolidated revenues | 1,283 | 912 | 2,246 | 2,395 | |
Depreciation and amortization | 0 | 0 | 0 | 0 | |
Income/(Loss) from continuing operations before taxes | 754 | 489 | 1,213 | 1,666 | |
Company-Owned Restaurants [Member] | Operating Segments [Member] | |||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||
Consolidated revenues | [2] | 105 | 1,567 | 219 | 3,742 |
Depreciation and amortization | [2] | 31 | 173 | 62 | 373 |
Income/(Loss) from continuing operations before taxes | [2] | $ (295) | $ (464) | $ (424) | $ (1,342) |
[1] | Portions of corporate administration and other have been allocated to segments. | ||||
[2] | Company stores that were closed are included in discontinued operations in the accompanying Condensed Consolidated Statement of Operations. |
Convertible Notes (Details)
Convertible Notes (Details) - 4% Convertible Senior Notes due 2022 [Member] | Mar. 03, 2017USD ($)Notes | Dec. 23, 2018Subsidiary$ / shares |
Convertible Notes [Abstract] | ||
Shareholders exercised subscription rights | Notes | 30,000 | |
Par value of shares exercised per note | $ 100 | |
Proceeds from issuance of convertible notes | $ 3,000,000 | |
Interest on convertible notes | 4.00% | 4.00% |
Maturity date of notes | Feb. 15, 2022 | |
Number of direct operating subsidiaries | Subsidiary | 2 | |
Conversion rate of common stock (in dollars per share) | $ / shares | $ 2 |