Noble Roman's, Inc. Announces First Quarter Earnings
INDIANAPOLIS, May 13 /PRNewswire-FirstCall/ -- Noble Roman's, Inc. (OTC
Bulletin Board: NROM), the Indianapolis based franchisor of Noble Roman's
Pizza and Tuscano's Italian Style Subs, today announced earnings for the
quarter ended March 31, 2008.
For the quarter the company reported net income of $321,431, or $.02
per share, on 19.2 million weighted shares outstanding. This compares to a
net income of $703,003, or $.04 per share, on 16.7 million weighted shares
outstanding for the quarter ended March 31, 2007. Total revenues for the
quarter ended March 31, 2008 were $2.4 million compared to $2.9 million for
the corresponding period in 2007.
Slower growth for the company's traditional co-brand franchise concept
during the first quarter more than accounted for the decrease in first
quarter revenue; royalty and fee income from existing franchises apart from
new franchise and development related fees actually increased from
$1,551,997 during the first quarter of 2007 to $1,702,178 for the first
quarter of 2008. Program enhancements previously announced in November 2007
were in full implementation during the first quarter of 2008. These
enhancements include: more rigorous franchisee selection criteria; a
longer, more robust training period for new franchisees; more direct
franchisee involvement in the construction and marketing process; and
intensified monitoring and enforcement of operating standards and unit
performance. As previously forecast, these enhancements have initially
resulted in slower growth in the company's traditional concept, but the
company believes they ultimately will provide for a stronger base of future
growth.
The company is also continuing its focus on awarding franchise
agreements for both Noble Roman's Pizza and Tuscano's Italian Style Subs in
non- traditional venues such as hospitals, military bases, universities,
convenience stores, attractions, entertainment facilities, casinos,
airports, travel plazas, office complexes and hotels. The non-traditional
franchising program has been the company's predominant growth vehicle for
the last several years, and it has recently increased its sales staff to
facilitate faster growth. Recent economic conditions, such as record oil
prices and difficult credit markets, have hampered the pace of growth in
certain non-traditional venues, but the company remains positive on the
longer-term outlook for these venues as the economic disruptions begin to
stabilize and resolve.
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, shifts in market demand, the
ability to successfully operate certain franchises on a temporary basis and
to re-franchise them, general economic conditions and other factors,
including (but not limited to) changes in demand for the company's products
or franchises, the success or failure of individual franchisees, the
success or failure of area developers who may or may not maintain their
minimum development schedule, and the impact of competitors' actions.
Should one or more of these risks or uncertainties adversely affect the
company or should underlying assumptions or estimates prove incorrect,
actual results may vary 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.
Noble Roman's, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
(Unaudited)
Assets December 31, March 31,
2007 2008
Current assets:
Cash $832,207 $2,990,315
Accounts and notes receivable (net of
allowances of $106,712 as of
December 31, 2007 and March 31, 2008) 1,770,994 2,058,725
Inventories 310,362 329,733
Assets held for resale 643,915 1,182,509
Prepaid expenses 175,022 230,115
Current portion of long-term notes receivable 133,736 84,373
Deferred tax asset - current portion 1,971,875 1,588,000
Total current assets 5,838,111 8,463,770
Property and equipment:
Equipment 1,289,795 1,291,901
Leasehold improvements 107,729 107,729
1,397,524 1,399,630
Less accumulated depreciation and amortization 755,987 782,733
Net property and equipment 641,537 616,897
Deferred tax asset (net of current portion) 9,106,008 9,324,298
Other assets including long-term portion
of notes receivable less allowances
of $550,000 as of December 31, 2007
and March 31, 2008 1,883,644 1,936,308
Total assets $17,469,300 $20,311,273
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable and accrued expenses $532,264 455,283
Current portion of long-term note payable 1,500,000 1,500,000
Total current liabilities 2,032,264 1,955,283
Long-term obligations:
Note payable to bank (net of current portion) 4,125,000 6,750,000
Total long-term liabilities 4,125,000 6,750,000
Stockholders' equity:
Common stock - no par value (25,000,000 shares
authorized, 19,187,499 issued and outstanding
as of December 31, 2007 and 19,197,499
issued and outstanding as of March 31, 2008) 22,905,617 22,924,775
Preferred stock (5,000,000 shares authorized
and 20,625 issued and outstanding as of
December 31, 2007 and March 31, 2008) 800,250 800,250
Accumulated deficit (12,393,830)(12,089,035)
Total stockholders' equity 11,312,036 11,635,990
Total liabilities and
stockholders' equity $17,469,300 $20,341,273
Noble Roman's, Inc. and Subsidiaries
Condensed Consolidated Statements of Operations
(Unaudited)
Three Months Ended
March 31,
2007 2008
Royalties and fees $2,585,407 $1,948,153
Administrative fees and other 18,347 13,441
Restaurant revenue 251,585 388,841
Total revenue 2,855,339 2,350,435
Operating expenses:
Salaries and wages 377,544 381,092
Trade show expense 137,786 123,473
Travel expense 79,239 113,581
Sales commissions 114,988 31,688
Other operating expenses 226,020 237,474
Restaurant expenses 234,407 374,427
Depreciation and amortization 21,347 25,318
General and administrative 425,032 422,302
Operating income 1,238,976 641,080
Interest and other expense 173,819 154,063
Income before income taxes 1,065,157 487,016
Income tax expense 362,154 165,586
Net income 703,003 321,431
Cumulative preferred dividends 41,135 16,636
Net income available to common
stockholders $661,868 $304,795
Earnings per share - basic:
Net income $.04 $.02
Net income available to common stockholders .04 .02
Weighted average number of common shares
outstanding 16,668,018 19,196,395
Diluted earnings per share:
Net income $.04 $.02
Weighted average number of common shares
outstanding 20,046,737 20,297,994
SOURCE Noble Roman's, Inc.
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