RAVE - Earnings call transcript Q4 2018 | RAVE Restaurant Group, Inc.

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Operator

Good day, and welcome to the RAVE Restaurant’s Fourth Quarter and Fiscal Year 2018 Financial Results Summary Conference Call. All participants will be in a listen-only mode [Operator Instructions]. After today’s presentation, there’ll be an opportunity to ask questions. [Operator Instructions]. Please note this event is being recorded today. like the I’d Andrea over that, Allen. with to conference turn to And go Please ahead.

Andrea Allen

afternoon, Relations you that also XXXX www.raverg.com and RAVE Good year release to you. Thank thank can and quarter this section. fourth Everyone have the fiscal and in afternoon. our call. press fourth Restaurant earnings for at quarter fiscal published conference be year release found earnings XXXX should Investor access was Group’s the joining The

to results Any should in note or useful today’s evaluating in will substitute performance. call, we can such that, of financial With I’d of like prepared to that certain considered results you materially discussions put a we Crane, would in and everyone that We forward-looking Please and is non-GAAP Before These financial more also that we as impact statements conference our expect. to discuss be measures, I our we to all detailed for what during should are risks undue A performance, not Chief remind part of could subject filings which our the them. the operating future our earnings These of are numerous today statements. be cause release. information discussion not condition. like believe our isolation over begin, accordance on differ therefore, you discussion future and reconciliation available to include from will call for refer GAAP. with Scott results reliance not risks recent uncertainties forward-looking our SEC statements Executive comparable that the a turn of in GAAP Officer. measures actual guarantees could to

Scott Crane

as brands. joining quarter positive results. growth store both Thank the our quarters, progress sales decision and to driving fiscal in XXXX a pleased really key full-year in today. solid we’re we of fourth elements executing laid plans, against share have success made towards in our point strong our I’m with coming encouraged financial comparable with the revitalization The made trends turnaround. phase call you, for foundation us Very next by to a for everybody, our to retail the

most momentum in For year, I’m sales been We between direct to well prior store we’ve Inn, online as a Both and have to observed location the Pizza both - restaurant as implementing. buffet proven for remodeled notably, initiatives correlation increased increased new ordering add comparable incremental traffic sales. we’ve the year. an X.X% increase traffic, sales and sorry, attribute franchise sales the all-day and sales,

met momentum prior our period continuing sales Pie continued line as first in sales For as many you recent new several quarter Five period offerings the seeing sales while at XX.X% product quarter were the the year, today, probably improving, Pie yesterday, to looked up two, trend system positive. been we Five from The growth decreased are consumer the down the as our past retail and and with sales XX.X%. but are face year, retail you’ve are initiatives comp top show have year, And trends challenges brand response. store or one, ended total and

of the melts Pie we are President point-of-sale introducing revenue have future you new Our Five and gas and options, hopefully, improve as you of quarters, RAVE as Bob low-carb Group. and all sales and the quarter. XX-inch including gas And has heard over frequency Recently, for to new ago, brand. promotion of a these streams to brand to with With program and Restaurant buffet oil system, the a I’d the President, leadership, the Bafundo, turn RAVE’s will expand. strengthening that, rewards been off-premise the Since in pizzas all-day franchise like legacy Pizza crust offline, results both continued share announced, role from have believe our call years the experience. two Inn new new shareable to or the for that We cauliflower has sandwich changers Bob game pivotal and Bafundo, the Bob’s led new to Inn relation. increased online energizing to played Pizza joining Bob in catering ordering, added

Bob Bafundo

Thanks, Scott.

quarter in we store Inn Pizza mentioned, RAVE’s comparable retail of added comparable As sales both Inn the Scott the progress increased period total retail sales. year. in Pizza of same store six Pie quarter the of continue fourth Five. growth to compared and to X.X% prior see consecutive

the XXXX, period same X.X%, store year, increased X.X% by retail while increased and sales continuing we domestic quarter compared For momentum comparable this of domestic of the prior the sales is believe XXXX. retail into fourth fiscal to total

comparable We’re very markets. in in the about watching impacts the Hurricane despite Tennessee challenges, Carolinas we’re optimistic closely the store seventh sales. our retail Inn weather of Florence But consecutive quarter growth and Pizza of a

Pizza RAVE airport operators its footprint gives as into our for also virtually three to travel fourth of convenience malls, complement model PIE, with settings. stores, traction our gaining every business footprint Pizza and XX feet. kiosk in to Express, quickly square PIE and low a including and existing startup It Airport. Inn now centers opened is Lauderdale to During costs. was model the Pizza we to with and the PIE diversify new X,XXX quarter, introduced our a PIE its Fort locations, Inn between convenience guests kiosk a or due allow the due Inn will its

units to we are see strong year the increased During the finished and our buffet traditional At units and Inn our model XXXX, from prospective in kiosk fourth units international XX. Pizza the PIE of Inn, X at quarter experiencing fiscal in renewed interest Pizza licensees. interest model XXX number of by domestic

decreased opening year. sales X.X% growing to retail market look fourth in a in Inn next refreshed Five and the the comparable Dallas-Fort of our when prior We the to XXXX, forward design upcoming pipeline Pizza Pie compared restaurant quarter have the of store Worth week. fiscal

factors and limited in delivery. through reduced model emphasis speed and labor with we that on with our and franchisees model fast-casual and the mentioned, on meet encouraged climate offers prototype This very for at by sandwich a our Five return a It’s modern estate cauliflower new a line. real building to recently and have right-sized Pie the menu level. pizzas to Scott costs including layout. been offerings, ‘Goldilocks’ off-premise new we’re current startup simplicity third-party XX-inch that the recent response is focuses carry ordering online crust, an It costs and menu a and calling business out the evolving very popular in the As introduced sales along competitive unit industry.

We first the Garden and Our additional year owned next month, franchised one company City, expected Pie and with to location is Goldilocks have in by Five open development. we locations XX in restaurants. finished Kansas,

franchisees it detail. initiatives to largely to our sales. Administrative results allowed and the going partner call to Chief and existing point, Accounting test Our refranchising new been to initiatives us develop that our drive over financial turn in further discuss is have with Allen, to and successful Officer, At this I’m Andrea

Andrea Allen

Thanks, Bob.

the in compared revenues decreased quarter, the fourth year. period $X.X million to prior million, total the same of $X.X For

from the million franchisee Decreased driven XXXX, to to revenues fiscal of $XX.X by the transfers company-owned For were reduction revenues enclosures. million due prior $XX.X primarily decreased total in units, year. to

increase $XXX,XXX a the $X.X over equivalents prior increased cash reversal was of Adjusted All Net a compared before are the largely XXXX, previous expenses. in to diluted $X.X for end prior comparable to share Pie fiscal million, million million, to a or Net to per million the the EBITDA the per $XXX,XXX the $XXX,XXX from to cash Five year. partial quarter, international income company-owned were allowance $X.XX and year. in compared same diluted $X.X other fiscal XXXX. to in assets, year-end. prior million $X.X fourth fiscal share, $X.X the XXXX decrease quarter million and year. in share, period increased income increased XX or of in end a owned tax $X.X improvement in $XXX,XXX deferred the Increases million, prior $X.X of the franchised the for or in benefit to other $X.XX diluted negative loss the diluted to or compared the income and June negative of net of administration to of in and one the or company’s at over Adjusted the the fiscal $X.XX of XXXX, company valuation same stores restaurant, licensed. domestic million for fourth per to prior quarter $X.X the corporate compared XXXX was per either compared tax XXX from period XXXX, due as and of As The year. XX, year $XX.X units $X.XX prior share million, of EBITDA fourth loss period

fiscal in the year, operating cash used activities used prior was our million $X.X year. in versus XXXX During $X.X million

year, the of had $X.X For million. XX, $X.X by capital had million We year. company’s $X.X a we the improvement from from sale $X.X million, XXXX of end end fiscal prior fiscal cash deficit XXXX financing provided investing the to cash million payment The $X.X by in stock million in of provided increased flows activities, XXXX, a to net cash Total in at of of shareholders’ June we assets $X.X short-term and XXXX, that million net prior million as of partially of the cash loan the in at versus fiscal compared net the of fiscal equivalents the was the $X.X expenditures proceeds activities by $X.X in sale the cash from year. XXXX. resulting and over million offset from provided was $XXX,XXX financing activities from equity of $X.X of of proceeds of The the have $XXX,XXX million.

reminder, operating in average line SEC our comp and filings. explanations. item in tables brand-specific disclosed deal and restaurant details great information non-comp our financial volumes we and a statement a earnings income and of performance earnings includes unit brand-specific release, This and As in

afternoon. the for open for and SEC Pizza and Form Pie on with up to innovating model, the products In growth let’s services Five we’re our Our this and track we top that branding that, with plan line line was in us the focusing on closing, lead executing of with franchisees strategic growth simplifying initiatives With future. believe XX-K filed business earlier new our our continued questions. will and that Inn

Operator

begin time, now question-and-answer will this any be We there [Operator Instructions] to session. doesn’t the appear questions. At

we a have It to did [ph]. question in. Please sorry, ahead. from like I’m - it go Masters] that, pop do with looks like [Brent looks we question like So would a

Unidentified Analyst

Yes, you. thank

least, assuming question Inn enthusiasm, your that, growth. does turnaround, share that which Express at That umbers with I where favorable returns Pizza positive But cetera. we’re on Inn - Five, quick are hopeful So continuing the et combined hold there, for expectations concept, as hard goes got guess, the the PIE as we some, concept, the for Pie to it’s get PIE, entities? Pizza the will more get over But your next far steady on year we’ve some all to still turnaround. the back the growing combined concept,

Scott Crane

Yes, that, so I a question. little a it bit, say to I alluded great would Brett.

Andrea Allen

Brent.

Scott Crane

Brent. And which seeing fact to we’re that is I it, our that, ended continued compress, - first say, - Yes, yesterday continuing we call quarter with comps in their would And the Pie the sales, Five - momentum good. yesterday. negative yes,

What the has is, way XXXX. coming out a Goldilocks it’s it there’s it’s business big I that model business or we’ve a your unfair comes model. with works. I of probably this project And our think new the talked that around about way got with [indiscernible] Inn it - talk been that since think, portion that’s to the to - Pizza Bob about, me I comment,

at is So with stores, Pizza, in and Five, have that your franchisees, And to a got disposal, big a legacy affordable. new to box stores we’re et pizza new current which revitalizing major now model and retailers, everyone grab outlets, more is allows and you that franchisees cetera. much order whole remodels, five-minute this whether or Pie for now think, of we’ve with a with convenience world I it be PIE go new made a growth prototype with then with works brand now we’ve got new

it’s being car think I pizza, we’re seeing grab go. something And and up, one the that the But with way, we’re you sandwiches, in that your by what of calzone XX-inch portability to the So working store. this we’re on high-quality putting that’s able all stuff. the that and

guess, and/or on So I’m your that’s, that’s are giving here all a there at. from going really things it’s where hard But answer I and call. so have question, press long we’re exciting, release that think I many a to to and you seen it’s that that but short do a

Unidentified Analyst

growth that. as for Are the to to projections record go on Thank any over you next prepared year? you

Scott Crane

that I what have no idea means.

Unidentified Analyst

revenues? Or percentage revenues or basis on growth

Scott Crane

No.

Unidentified Analyst

Okay.

Operator

Please next today’s be question from - with will go And Mike [indiscernible]. ahead.

Unidentified Analyst

How with your good So question all? I just you afternoon. Bob familiar simple. history Scott, read My want to and really Yes, about is I’m on biographically. their Andrea you are congratulate promotions. having

next First Norco, you’re the to six that be the to doing continued next you’re three, that the guys guys off, Is sounded it’s consecutive you make you’re reasonable it you And - burn, getting a two, turnaround. okay. the wavelength on I you realize, going just same you the think quarters? do I are sure rid to assumption? three going My still a how like, do is, okay two envision for that like battleship quarters? to question great. see be only I to of improvement, it’s the for wanted last four quarters, cash quarter, of,

Scott Crane

Yes.

So jump Andrea here. say would what I in and

there no from So is - here cash and here burn now. on

have me, I if position, say a on some see hang ourselves [ph] We again, [if just she’s here, like in to to now]. going shoot wrong put

Unidentified Analyst

Yes.

Scott Crane

from went versus how year-and-a-half shareholder when run have we started here - make check out equity. ago a got we figured we have cash, I - We now of to

the growing We’re business.

We growing are three now brands.

the We same fixing are hands.

I and that downside, is would it renew. in nothing what off-balance an The outside it’s with there an on dealt So is comparison are be have knock issue. wood, just in, up, pales thing shouldn’t yes, we cash mean, probably any other no but to only leases be sheet which

Unidentified Analyst

are. That’s really Okay.

to soon. Thanks down new taking think, continue Just you’re the and your great doing path, [indiscernible] call, job, aboard Scott. I for a spot to the welcome

Scott Crane

Well, Great appreciate Thank I you. questions. you. No, Thank it. actually,

Unidentified Analyst

Thanks. Okay.

Operator

now you as that, do your thank I And today’s today’s with attending today’s this question-and-answer conference. session, disconnect conclude as want And time, lines. for may We will at presentation. well to you

RAVE Restaurant (RAVE) 25 Sep 182018 Q4 Earnings call transcript