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NexCen: 2nd-Q revenue jumps on acquisitions

NEW YORK NexCen Brands Inc., the embattled franchisor of five quick-service chains and four retail or consumer products brands, reported Tuesday that revenues from its franchising business totaled $12.0 million for the second quarter ended June 30, up from revenues of $4.7 million a year ago, mainly on new franchise sales.

Despite credit trouble, asset impairment charges and corporate layoffs, NexCen said franchised locations totaled 1,895 in the second quarter versus 1,174 locations at the end of last year’s second quarter. NexCen's restaurant brands include Marble Slab Creamery, MaggieMoo’s, Pretzel Time, Pretzelmaker and Great American Cookies.

NexCen said that during the current third quarter it has closed on franchise agreements for an additional 105 units across all its brands, including an agreement for 40 Great American Cookie locations in Canada.

New York-based NexCen has worked since this summer to shore up its balance sheet after a “near-term operating cash shortfall” was created by the company’s $93.7 million acquisition of Great American Cookie Co. Prior to restructuring its credit arrangements with lender BTU Capital Corp., which NexCen completed last month as its chief executive Bob D’Loren stepped down, the company said it had owed $30 million. NexCen still is exploring strategic alternatives to increase liquidity and said it is in “active discussions” for the sale of its Waverly and Bill Blass consumer brands.

Because of the pending sale, as well as the finalization of charges for its refinanced credit facility and other corporate changes, NexCen said it was unable to report full financial results. NexCen noted it could not estimate when a full second-quarter report would be available, and when subsequent restatements for the full year ended December 2007 and the first quarter of 2008 would be filed with regulators.

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