THE COLONY, Texas -- Pizza Inn posted a sharp drop in income on slightly increased revenues in its fiscal 2002 annual report.
During the 53-week period, which ended on June 30, net income decreased 54 percent to $1.14 million, down from $2.5 million in 2001. Revenues for the period were $66.6 million, versus $65.3 million in '01.
The income drop reduced diluted earnings per share by 52 percent to 11 cents, versus 23 cents a share in '01.
According to Pizza Inn's annual report, the decrease in net income was primarily attributable to a pretax charge of about $1.9 million connected to a loan to the company's former CEO, C. Jeffrey Rogers. When Pizza Inn's board of directors determined Rogers' repayment of the loan was unlikely, he resigned in August and the company absorbed the charge in this year's fourth quarter, which ended June 30.
The report said that following Rogers' resignation, the company gave him a severance package that included a cash payment of $315,000, $26,314 for unused vacation time, and $25,000 more for unspecified executive-placement services. Still, Pizza Inn still intends for Rogers to pay back the loan, and stated that it will see he does "to the extent legally permissible ... ."