2014

Noble Roman's Announces Continued Growth, Profitability for Second Quarter 2013 Eight Stand-Alone Take-n-Bake Locations Open with 13 Additional Locations Under Development; Grocery Take-n-Bake Program Continues to Expand with Approximately 1,675 Grocery License Agreements; and 30 New Non-Traditional Franchise Agreements Signed Thus Far in 2013

INDIANAPOLIS, Aug. 12, 2013 /PRNewswire/ -- Noble Roman's, Inc. (OTC/BB: NROM), the Indianapolis based franchisor and licensor of Noble Roman's Pizza and Tuscano's Italian Style Subs, today announced results for the quarterly period ended June 30, 2013. 

Second Quarter 2013 Financial and Operational Highlights Compared to Second Quarter 2012

  • Net income before taxes was $754,467, or $0.04 per share, compared to $466,520, or $0.02 per share. The company will pay no income taxes on approximately the next $25 million in net income.
  • Net income was $455,622, or $0.02 per share, compared to $242,122, or $0.01 per share.
  • Operating margin on total revenue was 40.5% compared to 37.1%.
  • Total revenue was $1.99 million, up 10.8% compared to $1.79 million.
  • Upfront franchisee fees and commissions were $241,726 compared to $63,489.
  • Royalties and fees less upfront fees were $1.62 million compared to $1.60 million.
  • Royalties and fees from non-traditional franchises other than grocery stores were $1.11 million compared to $1.15 million
  • Royalties and fees from grocery store take-n-bake locations were $374,085 compared to $370,825.
  • Royalties and fees from traditional locations were $81,033 compared to $80,329.
  • Royalties and fees from stand alone take n bake locations were $53,000 compared to none.

For purposes of comparing current operating results, the 2012 amounts above were adjusted, where appropriate, for the $100,000 reduction in reserve for collectability of receivables from the Heyser Plaintiffs, which resulted in increasing revenues for the 2012 period shown for units no longer operating. Details regarding the adjustment for the reserve are provided in the company's Form 10-Q filed with the Securities and Exchange Commission.

Financial and Operational Highlights for the First Six-Months in 2013 Compared to Comparable Period in  2012

  • Net income before taxes was $1.45 million, or $0.07 per share, compared to $871,000, or $0.04 per share. The company will pay no income taxes on approximately the next $25 million in net income.
  • Net income was $874,000, or $0.04 per share, compared to $526,000, or $0.03 per share.
  • Operating margin on total revenue was 40.0% compared to 31.2%.
  • Total revenue was $3.88 million, up 13.0% compared to $3.43 million.
  • Upfront franchisee fees and commissions were $365,000 compared to $148,000.
  • Royalties and fees less upfront fees were $3.27 million compared to $3.02 million.
  • Royalties and fees from non-traditional franchises other than grocery stores were $2.27 million compared to $2.17 million
  • Royalties and fees from grocery store take-n-bake locations were $771,000 compared to $695,000.
  • Royalties and fees from traditional locations were $158,000 compared to $160,000.
  • Royalties and fees from stand alone take n bake locations were $77,000 compare to none.

For purposes of comparing current operating results, the 2012 amounts above were adjusted, where appropriate, for the $300,000 reduction in reserve for collectability of receivables from the Heyser Plaintiffs, which resulted in increasing revenues for the 2012 period shown for units no longer operating. Details regarding the adjustment for the reserve are provided in the company's Form 10-Q filed with the Securities and Exchange Commission.

"We continue to successfully leverage the opportunities for revenue growth while maintaining control over operating expenses by maintaining focus on our primary growth engines through our take-n-bake initiatives," said Paul Mobley, Chairman and CEO of Noble Roman's, Inc. "This success is reflected in our growth in revenue, growth in operating margin and increase in net income before taxes. We have built a profitable platform for growth, benefitting from the increasing popularity of the take-n-bake concept, and as we expand both the stand-alone franchise concept and our network of grocery customers, we expect accelerated top- and bottom-line growth. We are well on our way to achieving our growth initiatives for the year in both areas."

The company has entered into agreements for 21 stand-alone take-n-bake locations. The first two stand-alone take-n-bake pizza locations opened in October and December 2012 and, to date, a total of eight have been opened with 12 under development and expected to open in the next few months. The company's stand-alone take-n-bake program features the chain's popular traditional Hand-Tossed Style pizza, Deep-Dish Sicilian pizza, SuperThin pizza, all with a choice of three different types of sauce, and Noble Roman's famous breadsticks with spicy cheese sauce, all in a convenient cook-at-home format.  Additional menu items include such items as fresh salads, cookie dough, cinnamon rounds, bake-able pasta and more.  The company is currently in discussions with many other prospects for its stand-alone program and is advertising for additional franchisees through various web-based franchise referral systems, which began in late January 2013. The Company expects to sign several more agreements for the stand-alone take-n-bake franchise yet this month.

Thus far in 2013, the company has signed 30 additional new franchise agreements for non-traditional locations and is in discussion with numerous other convenience store chains and entertainment facilities for additional non-traditional locations. The primary source of growth in this segment comes from existing franchisees and exhibiting in various industry trade shows including the National Association of Convenience Stores, Western Petroleum Marketers Association, International Association of Amusement Parks and Attractions, and selected state convenience store associations.

Balance Sheet Summary

Cash and cash equivalents totaled approximately $265,000 as of June 30, 2013 compared to $144,000 as of December 31, 2012.  Total bank debt was $3.6 million as of June 30, 2013 compared to $4.3 million as of December 31, 2012.  Total stockholders' equity as of June 30, 2013 was approximately $13.3 million compared to $12.4 million as of December 31, 2012.

Teleconference

Management will conduct a live teleconference to discuss its financial results at 4:30 p.m. ET on Monday, August 12, 2013. Anyone interested in participating should call 1-877-941-1427 if calling from the United States, or 1-480-629-9664 if dialing internationally. A replay will be available until August 19, 2013, which can be accessed by dialing 1-877-870-5176 within the United States and 1-858-384-5517 if dialing internationally. Please use passcode 4633992 to access the replay. In addition, the call will be webcast and will be available on the Company's website at www.nobleromans.com or by visiting http://public.viavid.com/index.php?id=105613.

The statements contained in this press release concerning the company's future revenues, profitability, financial resources, market demand and product development are forward-looking statements (as such term is defined in the Private Securities Litigation Reform Act of 1995) relating to the company that are based on the beliefs of the management of the company, as well as assumptions and estimates made by and information currently available to the company's management.  The company's actual results in the future may differ materially from those projected in the forward-looking statements due to risks and uncertainties that exist in the company's operations and business environment, including, but not limited to, competitive factors and pricing pressures, non-renewal of franchise agreements, shifts in market demand, general economic conditions, changes in purchases of or demand for the company's products, licenses or franchises, the success or failure of individual franchisees and licensees, changes in prices or supplies of food ingredients and labor, and the success or failure of its recently developed stand-alone take-n-bake operation.   Should one or more of these risks or uncertainties materialize, or should underlying assumptions or estimates prove incorrect, actual results may differ materially from those described herein as anticipated, believed, estimated, expected or intended.  The company undertakes no obligations to update the information in this press release for subsequent events.

FOR ADDITIONAL INFORMATION, CONTACT:
For Media Information: Scott Mobley, President 317/634-3377
For Investor Relations: Paul Mobley, Chairman & CEO 317/634-3377 
  or Brett Maas, Hayden IR, 646/536-7331 or brett@haydenir.com

 

 

Noble Roman's, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets

(Unaudited)




                                                         Assets

December 31,
2012

June 30,
2013

Current assets:



   Cash

$ 144,354

$ 265,463

   Accounts and notes receivable - net

1,080,362

1,387,029

   Inventories

460,839

477,929

   Assets held for resale

259,579

259,579

   Prepaid expenses

379,669

541,596

   Deferred tax asset - current portion

1,400,000

1,400,000

           Total current assets

3,724,803

4,331,596




Property and equipment:



   Equipment

1,166,103

1,170,627

   Leasehold improvements

12,283

12,283


1,178,386

1,182,910

   Less accumulated depreciation and amortization

905,376

931,131

          Net property and equipment

273,010

251,779

Deferred tax asset (net of current portion)

9,238,536

8,665,308

Other assets

3,924,404

4,068,828

                      Total assets       

$ 17,160,753

$ 17,317,511




Liabilities and Stockholders' Equity



Current liabilities:



   Current portion of long-term note payable to bank

$  1,250,000

1,250,000

   Accounts payable and accrued expenses

510,710

410,665

                Total current liabilities

1,760,710

1,660,665




Long-term obligations:



   Note payable to bank (net of current portion)

3,020,833

2,395,833

               Total long-term liabilities

3,020,833

2,395,833







Stockholders' equity:



   Common stock – no par value (25,000,000 shares authorized, 19,516,589

       issued and outstanding as of December 31, 2012 and June 30, 2013)

23,366,058

23,423,273

   Preferred stock (5,000,000 shares authorized and 20,625 issued and

       outstanding as of December 31, 2012 and June 30, 2013)

800,250

800,250

   Accumulated deficit

(11,787,098)

(10,962,510)

                Total stockholders' equity

12,379,210

13,261,013

                      Total liabilities and stockholders' equity

$ 17,160,753

$ 17,317,511




                                                                              

Noble Roman's, Inc. and Subsidiaries

Condensed Consolidated Statements of Operations

(Unaudited)







 Three Months Ended
June 30, 

Six Months Ended

June 30,


2012

2013

2012

2013

Royalties and fees

$ 1,767,414

$ 1,857,503

$3,470,980

3,639,809

Administrative fees and other

5,496

7,600

12,743

8,876

Restaurant revenue

120,680

122,275

247,529

229,431

                Total revenue

1,893,590

1,987,378

3,731,252

3,878,116






Operating expenses:





     Salaries and wages

253,524

262,827

496,983

512,030

     Trade show expense

123,127

129,991

244,124

259,540

     Travel expense

45,459

55,240

94,374

99,555

     Other operating expenses

172,008

182,957

350,209

364,320

     Restaurant expenses

113,029

109,742

232,272

214,850

Depreciation and amortization

28,561

28,343

59,225

56,689

General and administrative

392,670

413,564

788,387

820,548

              Total expenses

1,128,378

1,182,664

2,265,574

2,327,532

              Operating income

765,212

804,714

1,465,678

1,550,584






Interest and other expense

198,692

50,247

294,621

103,404

              Income before income taxes

566,520

754,467

1,171,057

1,447,180






Income tax expense

224,398

298,845

463,856

573,228

              Net income

342,122

455,622

707,201

873,952






              Cumulative preferred dividends

24,683

24,411

49,636

49,364






              Net income available to common

                   stockholders

$  317,439

$ 431,211

$  657,565

$  824,588











Earnings per share – basic:





     Net income  

$          .02

$          .02

$         .04

$         .04

     Net income available to common stockholders

$          .02

$          .02

$         .03

$         .04

Weighted average number of common shares

      outstanding

19,489,317

19,516,589

19,483,383

19,516,589











Diluted earnings per share:





     Net income

$          .02

$          .02

$         .04

$         .04

     Net income  available to common

          stockholders

$          .02

$          .02

$         .03

$         .04

Weighted average number of common shares

     outstanding

20,041,048

20,290,932

20,035,114

20,290,932

 

SOURCE Noble Roman's, Inc.



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