Overview

• US chocolate retailer's fiscal Q1 revenue fell 4% yr/yr to $6.1 mln

• Company posted net loss of $1.2 mln, wider than prior-year period

• Revenue decline driven by lower royalty and marketing fees under revised franchise agreements

Outlook

• Company prioritizes improving production, fulfillment and distribution in coming quarters

• Rocky Mountain Chocolate Factory aims to pursue higher-margin product opportunities

• Company plans to evaluate debt structure and working capital at favorable terms

Result Drivers

• PRICE INCREASES - 3% increase in Durango product and retail sales attributed to higher prices

• LOWER FRANCHISE FEES - Revenue decline driven by lower royalty and marketing fees under revised franchise agreements

• HIGHER OPERATING COSTS - Increased costs tied to franchise website and delivery platform rollout, and more company-owned stores

Company press release: ID:nGNXbC4TJQ

Key Details

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