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Pie Five's dismal Q4 results drag down Rave's overall performance

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September 30, 2019

Pizza Inn and Pie Five parent, Rave Restaurant Group Inc., reported sizable sales decreases at Pie Five over the fourth quarter of the company's financial year, though modest sales gains at Pizza Inn buoyed the company's overall performance. Nonetheless, it was not enough to prevent a company-wide net loss of $0.8 million for the last quarter of the 2019 fiscal year.

According to information released this morning, other key Q4 performance numbers, include: 

• Total comparable store domestic retail sales decreased 0.7% quarter-year over quarter-year. 
• The company recorded a net loss of $0.8 million, compared to net income of $3.3 million for Q4 2018. 
• Pizza Inn domestic comparable store retail sales grew 2.2% quarter-year over quarter-year. 
• Total Pizza Inn domestic retail sales were up 0.8%.
• Pie Five comparable store retail sales fell 7.3% for the period over last year's quarter. 
• Total system-wide Pie Five retail sales plummeted 22.1%, attributed to a drop in average units open.

The company maintained its valuation allowance against net deferred tax assets in the fourth quarter, compared to a partial reversal in the same period of the prior year that resulted in a $3.4 million tax benefit. On a fully diluted basis, the company had a net loss of 5 cents per share this year's quarter, compared to net income of 21 cents per share for the same period of the prior year.

"To improve service consistency and operational efficiency at Pie Five, we've added Scott Black to the team as our new vice president of operations," Rave Restaurant Group President Bob Bafundo said in the announcement. "Scott has a proven track record of success with over 30 years of experience in the food and beverage industry, specifically in the pizza segment and as a restaurant owner. Scott is assisting us in sharpening our distinctive service model to create a guest experience that capitalizes on the customization, approachability, and speed of dining with Pie Five."

Overall for the company, adjusted EBITDA of a $0.3 million loss during the quarter fell $0.6 million from the same period last year, while cash and cash equivalents grew to $2.3 million at the end of the quarter, which was a $0.3 million increase during the quarter.