RAVE Restaurant Group, Inc. disclosed an earnings per share (EPS) of 6 cents in the last quarter of fiscal year 2024, showcasing a robust 50% surge year over year.
The full-year EPS stood at 17 cents, a remarkable 70% rise compared to the previous fiscal year.
Revenue Performance of RAVE
During the fiscal fourth quarter, RAVE Restaurant Group reported revenues of $3.4 million, marking a $0.3 million increase year over year.
Despite lower revenues from the Pie Five Franchising segment impacting the overall performance, full-year revenues amounted to $12.2 million, exhibiting a 2.2% enhancement from the comparable fiscal 2023 period.
The stock of the company soared by nearly 20% in the latest trading sessions, reflecting investor enthusiasm.
Segment Overview of RAVE Restaurant
RAVE Restaurant garners revenues from two pivotal segments, namely Pizza Inn Franchising and Pie Five Franchising.
In the examined quarter, Pizza Inn Franchising domestic comparable store retail sales observed a 1.5% decline annually, whereas Pie Five domestic comparable store retail sales experienced a steeper 10.6% drop.
For the full fiscal year, Pizza Inn Franchising revenues showed a growth trajectory, reaching $10.3 million, up 4.9% from the fiscal year 2023, buoyed by heightened supplier and distributor incentives.
Financial Health and Analysis of Operating Expenses
General and administrative expenses at the conclusion of fiscal 2024 demonstrated a 4.1% decline year over year, totaling $5.3 million, attributed to reduced salary and stock-based compensation outlays.
Franchise expenses for fiscal 2024 lowered to $3.7 million, a 7.6% decrease from the prior year, with Pizza Inn franchise expenses decreasing 2.4% and Pie Five franchise expenses dropping by 25.2%.
Profitability Metrics of RAVE
The operating income for the full fiscal year 2024 surged by an impressive 43.8% from fiscal 2023, totaling $3.1 million.
Net income for fiscal year 2024 amounted to $2.5 million, reflecting a notable 53.3% increase from fiscal 2023. Adjusted EBITDA for the same period showed a 16.8% rise, reaching $3.2 million.
Liquidity Management of RAVE Restaurant
As fiscal 2024 concluded, RAVE Restaurant Group had cash, cash equivalents, and short-term investments totaling $7.8 million, marking a substantial increase from the $5.3 million recorded at the end of fiscal 2023.
Cumulative net cash provided by operating activities at the close of fiscal 2024 reached $2.7 million, modestly surpassing the figure from a year earlier.
Analysis and Projection
RAVE Restaurant wrapped up fiscal 2024 with commendable top and bottom-line results, highlighted by robust revenues from the Pizza Inn Franchising segment and a promising surge in domestic comparable store retail sales.
Management’s proactive strategy to reimagine more than 25% of the company’s buffet restaurants by the end of fiscal 2025 instills confidence among investors, underscoring a positive outlook for the stock.
The recent deployment of an enhanced online ordering platform by RAVE Restaurant in the last quarter is anticipated to augment its digital business, streamlining orders and integrating third-party delivery sites, thus presenting additional growth prospects.
Nonetheless, the subdued revenues from the Pie Five Franchising segment, coupled with the decline in domestic comparable store retail sales for the fiscal year, pose challenges that warrant attention.