UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 OR 15(d) of The Securities Exchange Act of 1934
Date of
Report (Date of earliest event reported) September 25,
2008
Pizza
Inn, Inc.
(Exact
name of registrant as specified in its charter)
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Missouri
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0-12919
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47-0654575
|
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(State
or other jurisdiction of incorporation)
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(Commission
File Number)
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(IRS
Employer Identification No.)
|
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3551
Plano Parkway, The Colony, Texas
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75056
|
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(Address
of principal executive offices)
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(Zip
Code)
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Registrant’s
telephone number, including area code (469) 384-5000
Not
Applicable
(Former
name or former address, if changed since last report)
Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions (see General Instruction
A.2. below):
o Written communications
pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material
pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
o Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
Item
2.02 Results of Operations and Financial Condition
On
September 25, 2008, Pizza Inn, Inc. issued a press release discussing financial
results of fiscal year 2008.
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(d)
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Exhibits
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Exhibit
Number
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Description
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99.1
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Pizza
Inn, Inc. press release dated September 25,
2008.
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SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
Pizza
Inn, Inc.
Date: September
25,
2008 By: /s/ Charles R.
Morrison
Charles
R. Morrison,
President
and Chief Executive Officer
FOR
IMMEDIATE RELEASE
Contact:
Nancy
Ellefson
VP
of Finance
Pizza
Inn, Inc.
469-384-5000
nellefson@pihq.com
PIZZA
INN, INC. REPORTS RESULTS FOR
FISCAL
YEAR 2008
Chain reports same store sales
growth of 2.6% for fiscal year 2008
The Colony, Texas – September 25,
2008-- PIZZA INN, INC. (NASDAQ:PZZI) today
reported net income of $2,825,000, or $0.29 per share, for the fiscal year ended
June 29, 2008, versus net income of $206,000, or $0.02 per share, for the prior
fiscal year. For the fourth quarter, the Company reported net income
of $729,000, or $0.08 per share, for fiscal 2008 versus $658,000, or $0.06 per
share, in the same quarter in the prior fiscal year. Highlights for
the fourth quarter and fiscal year 2008 included:
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·
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Comparable
domestic buffet restaurant sales increased 2.3% for the fourth quarter and
3.5% for fiscal 2008 compared to the prior fiscal
year.
|
|
·
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Total
comparable domestic restaurant sales increased 2.6% for fiscal 2008 and
1.8% for the fourth quarter compared to the prior fiscal
year.
|
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·
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The
fourth quarter of fiscal 2008 represented the 5th consecutive quarter of
same store sales growth compared to the prior
year.
|
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·
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General
and administrative expenses decreased 23% in fiscal 2008 compared to the
prior year despite fourth quarter expenses of $215,000, or $0.02 per
share, related to an internal controls assessment and other
compliance work in accordance with the Sarbanes-Oxley Act of
2002.
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Charlie
Morrison, President and CEO, commented, "It has been a great year for Pizza
Inn. We accomplished nearly all of our goals in the continued effort
to turn around this brand. Our positive same store sales growth is
evidence of a preference by customers to choose Pizza Inn’s quality over that of
our competition. Much of the work completed this year will manifest
itself in the opening of our next Company-operated restaurant in Denton, Texas
next month. This buffet-style restaurant will showcase a new, yet
familiar, look to the Pizza Inn brand which represents the future of
Company-owned and franchised Pizza Inn’s everywhere.”
Certain
statements in this press release, other than historical information, may be
considered forward-looking statements within the meaning of the “safe harbor”
provisions of the Private Securities Litigation Reform Act of 1995, and are
subject to various risks, uncertainties and assumptions. Should one
or more of these risks or uncertainties materialize, or should underlying
assumptions prove incorrect, actual results may differ from those anticipated,
estimated or expected. Among the key factors that may have a direct
bearing on Pizza Inn’s operating results, performance or financial condition are
its ability to implement its growth strategies, national, regional and local
economic conditions affecting the restaurant/entertainment industry, competition
within the restaurant and entertainment industries, success of franchise
operations, negative publicity, seasonality, government regulations, weather and
commodity, insurance and labor costs.
Pizza
Inn, Inc. (www.pizzainn.com)
is headquartered in The Colony, Texas, along with its distribution division,
Norco Restaurant Services Company. The Company is a franchisor and
food and supply distributor to a system of franchised and company owned
restaurants operating both domestically and internationally under the trade name
“Pizza Inn.”
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PIZZA
INN, INC.
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||||||||
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CONSOLIDATED
STATEMENTS OF OPERATIONS
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||||||||
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(In
thousands, except per share amounts)
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||||||||
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Year
Ended
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||||||||
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June
29,
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June
24,
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|||||||
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REVENUES:
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2008
|
2007
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||||||
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Food
and supply sales
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$ | 43,807 | $ | 41,029 | ||||
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Franchise
revenue
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4,970 | 4,622 | ||||||
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Restaurant
sales
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741 | 774 | ||||||
| 49,518 | 46,425 | |||||||
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COSTS
AND EXPENSES:
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||||||||
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Cost
of sales
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40,819 | 39,170 | ||||||
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Franchise
expenses
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2,538 | 2,633 | ||||||
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General
and administrative expenses
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2,957 | 3,842 | ||||||
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Severance
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391 | - | ||||||
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Provision
for bad debts
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146 | 96 | ||||||
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Loss
(gain) on sale of assets
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9 | (570 | ) | |||||
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Other
income
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- | (159 | ) | |||||
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Impairment
of long-lived assets
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- | 48 | ||||||
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(Recovery
of) provision for litigation costs
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(284 | ) | 302 | |||||
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Interest
expense
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- | 476 | ||||||
| 46,576 | 45,838 | |||||||
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INCOME
FROM CONTINUTING OPERATIONS BEFORE TAXES
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2,942 | 587 | ||||||
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Income
taxes
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(99 | ) | - | |||||
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INCOME
FROM CONTINUING OPERATIONS
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3,041 | 587 | ||||||
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Loss
from discontinued operations, net of income tax benefit
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(216 | ) | (381 | ) | ||||
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NET
INCOME
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$ | 2,825 | $ | 206 | ||||
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EARNINGS
(LOSS) PER SHARE OF COMMON
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||||||||
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STOCK
- BASIC:
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||||||||
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Income
from continuing operations
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$ | 0.31 | $ | 0.06 | ||||
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Loss
from discontinued operations
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$ | (0.02 | ) | $ | (0.04 | ) | ||
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Net
income
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$ | 0.29 | $ | 0.02 | ||||
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EARNINGS
(LOSS) PER SHARE OF COMMON
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||||||||
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STOCK
- DILUTED:
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||||||||
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Income
from continuing operations
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$ | 0.31 | $ | 0.06 | ||||
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Loss
from discontinued operations
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$ | (0.02 | ) | $ | (0.04 | ) | ||
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Net
income
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$ | 0.29 | $ | 0.02 | ||||
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Weighted
average common
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||||||||
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shares
outstanding - basic
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9,761 | 10,145 | ||||||
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Weighted
average common
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||||||||
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shares
outstanding - diluted
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9,789 | 10,146 | ||||||
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PIZZA
INN, INC.
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||||||||
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CONSOLIDATED
BALANCE SHEETS
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||||||||
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(In
thousands, except share amounts)
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||||||||
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June
29,
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June
24,
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|||||||
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ASSETS
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2008
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2007
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||||||
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CURRENT
ASSETS
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||||||||
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Cash
and cash equivalents
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$ | 1,157 | $ | 1,879 | ||||
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Accounts
receivable, less allowance for doubtful
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||||||||
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accounts
of $128 and $451, respectively
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2,773 | 2,716 | ||||||
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Notes
receivable, current portion
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6 | 8 | ||||||
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Income
tax receivable
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272 | - | ||||||
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Inventories
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1,396 | 1,518 | ||||||
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Property
held for sale
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301 | 336 | ||||||
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Deferred
income tax assets
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555 | 458 | ||||||
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Prepaid
expenses and other
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235 | 165 | ||||||
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Total
current assets
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6,695 | 7,080 | ||||||
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LONG-TERM
ASSETS
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||||||||
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Property,
plant and equipment, net
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635 | 778 | ||||||
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Notes
receivable
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7 | 12 | ||||||
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Deferred
income tax assets
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237 | - | ||||||
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Re-acquired
development territory, net
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46 | 239 | ||||||
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Deposits
and other
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215 | 85 | ||||||
| $ | 7,835 | $ | 8,194 | |||||
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LIABILITIES
AND SHAREHOLDERS' EQUITY
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||||||||
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CURRENT
LIABILITIES
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||||||||
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Accounts
payable - trade
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$ | 2,380 | $ | 2,082 | ||||
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Accrued
expenses
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1,316 | 1,805 | ||||||
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Total
current liabilities
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3,696 | 3,887 | ||||||
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LONG-TERM
LIABILITIES
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||||||||
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Deferred
gain on sale of property
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184 | 209 | ||||||
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Deferred
revenues, net of current portion
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283 | 314 | ||||||
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Other
long-term liabilities
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18 | 7 | ||||||
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Total
liabilities
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4,181 | 4,417 | ||||||
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COMMITMENTS
AND CONTINGENCIES (See Notes D, F and I)
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||||||||
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SHAREHOLDERS'
EQUITY
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||||||||
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Common
stock, $.01 par value; authorized 26,000,000
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||||||||
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shares;
issued 15,130,319 and 15,120,319 shares, respectively;
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||||||||
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outstanding
9,104,361 and 10,168,494 shares, respectively
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151 | 151 | ||||||
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Additional
paid-in capital
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8,543 | 8,471 | ||||||
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Retained
earnings
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17,624 | 14,799 | ||||||
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Treasury
stock at cost
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||||||||
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Shares
in treasury: 6,025,958 and 4,951,825, respectively
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(22,664 | ) | (19,644 | ) | ||||
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Total
shareholders' equity
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3,654 | 3,777 | ||||||
| $ | 7,835 | $ | 8,194 | |||||
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PIZZA
INN, INC.
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||||||||
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CONSOLIDATED
STATEMENTS OF CASH FLOWS
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||||||||
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(In
thousands)
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||||||||
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Year
Ended
|
||||||||
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June
29,
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June
24,
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|||||||
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2008
|
2007
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|||||||
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CASH
FLOWS FROM OPERATING ACTIVITIES:
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||||||||
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Net
income
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$ | 2,825 | $ | 206 | ||||
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Adjustments
to reconcile net income to cash
|
||||||||
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provided
by (used for) operating activities:
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||||||||
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Depreciation
and amortization
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342 | 692 | ||||||
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Impairment
of long-lived assets and goodwill
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- | 48 | ||||||
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Deferred
rent expense (benefit)
|
54 | (9 | ) | |||||
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Provision
for bad debt
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146 | 96 | ||||||
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Stock
compensation expense (benefit)
|
51 | (14 | ) | |||||
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Litigation
expense (benefit)
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- | 302 | ||||||
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Loss
(gain) on sale of assets
|
9 | (570 | ) | |||||
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Deferred
income taxes
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(334 | ) | 687 | |||||
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Changes
in operating assets and liabilities:
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||||||||
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Deferred
revenue
|
(53 | ) | 196 | |||||
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Notes
and accounts receivable
|
(196 | ) | 320 | |||||
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Income
tax receivable
|
(272 | ) | - | |||||
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Inventories
|
122 | 254 | ||||||
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Accounts
payable - trade
|
298 | (135 | ) | |||||
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Accrued
expenses
|
(490 | ) | (3,520 | ) | ||||
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Prepaid
expenses and other
|
(83 | ) | 76 | |||||
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Cash provided
by (used for) operating activities
|
2,419 | (1,371 | ) | |||||
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CASH
FLOWS FROM INVESTING ACTIVITIES:
|
||||||||
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Proceeds
from sale of assets
|
108 | 11,325 | ||||||
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Capital
expenditures
|
(249 | ) | (249 | ) | ||||
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Cash
(used for) provided by investing activities
|
(141 | ) | 11,076 | |||||
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CASH
FLOWS FROM FINANCING ACTIVITIES:
|
||||||||
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Deferred
financing costs
|
- | (25 | ) | |||||
|
Repayments
of long-term bank debt
|
- | (8,044 | ) | |||||
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Purchases
of treasury stock
|
(3,020 | ) | - | |||||
|
Proceeds
from exercise of stock options
|
20 | 59 | ||||||
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Cash
used for financing activities
|
(3,000 | ) | (8,010 | ) | ||||
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Net
(decrease) increase in cash and cash equivalents
|
(722 | ) | 1,695 | |||||
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Cash
and cash equivalents, beginning of year
|
1,879 | 184 | ||||||
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Cash
and cash equivalents, end of year
|
$ | 1,157 | $ | 1,879 | ||||