Rave Restaurant Group, Inc. reported its financial results for the three months ended September 29, 2024, revealing a slight decline in revenues but an increase in profitability compared to the same period in the previous fiscal year. Total revenues for the quarter were $3,050,000, down from $3,087,000 in the prior year. This decrease was primarily attributed to a decline in franchise royalties from Pie Five, which fell to $306,000 from $435,000, a decrease of 29.7%. Conversely, Pizza Inn franchise revenues increased by 4.5% to $2,720,000, driven by higher supplier and distributor incentives.

Total costs and expenses for the quarter decreased to $2,355,000 from $2,569,000, contributing to an increase in income before taxes, which rose to $695,518 from $518,000. Net income for the quarter was $526,000, compared to $386,000 in the same period last year, resulting in a basic income per share of $0.04, up from $0.03.

The company’s cash and cash equivalents decreased significantly to $1,383,000 from $2,886,000 at the end of the previous quarter, while short-term investments increased to $7,050,000 from $4,945,000. Total current assets rose to $10,256,000, up from $9,536,000, and total assets increased to $16,285,000 from $15,819,000.

In terms of operational performance, Pizza Inn's total domestic retail sales decreased by 2.5% to $27.3 million, while Pie Five's sales dropped by 37.5% to $2.978 million. The average number of open Pie Five units decreased from 27 to 20, contributing to the decline in sales.

The company recognized interest income of $76,000 from treasury bills, a significant increase from $2,000 in the prior year, reflecting a strategic shift towards more liquid investments. Additionally, recoveries for credit losses improved to $17,000, contrasting with a provision for credit losses of $25,000 in the previous year.

Rave Restaurant Group continues to operate in a challenging market environment, with management focusing on enhancing operational efficiencies and exploring growth opportunities within its franchise segments. The company remains committed to its strategic initiatives while navigating the complexities of the current economic landscape.