THE COLONY, Texas — Losses continue to add up at Pizza Inn, a chain struggling to return to its profitable past.
According to a regulatory filing, the 371-unit company lost $4.4 million for the fourth quarter ended June 25, 2006. Revenue fell 8 percent to $12.2 million, down from $13.7 million a year earlier. Comparable-store sales fell 3.7 percent for the period.
For its full fiscal year ended June 25, the chain lost nearly $6 million versus a profit of $204,000 last year. Revenue for fiscal 2006 was $50.6 million versus $55.3 million in 2005.
Almost half the company's losses were tied to a $2.8 million pretax charge related to a litigation settlement with former president and chief executive Ronald Parker (read also Pizza Inn settles with Parker, former CEO, for $2.8 million). The company also absorbed a $1.3 million charge on the closure of two buffet units.
Over the past year, Tim Taft, Pizza Inn chief executive and president, said Pizza Inn's recovery might see the company's condition worsen before it improves (read also New Pizza Inn CEO eager to start turnaround). Taft promised poorly run units would be culled from the system, even at the expense of lowered top-line sales. Fewer units also would shrink sales at Norco, but Taft has insisted an overall tightening of the system would better position the company for long-term recovery.
In an apparent vote of confidence by stockholders, shares of Pizza Inn closed unchanged at $2.12 on the Nasdaq on Oct. 10.