Dallas, Texas-based Rave Restaurant Group, Inc. reported a disappointing third quarter ended on March 29, tied to the economic impact of the global pandemic, with same-store sales of Pie Five down 21.4% and same-store sales of Pizza Inn down 7.8%.
"During this unprecedented time for the restaurant industry, I'm extremely proud of how our franchisees and team members have responded," Brandon Solano, CEO of Rave Restaurant Group said in a statement. "[…] We looked at all areas to reduce expenses, including furloughing two-thirds of our support staff and an across-the-board 20% pay reduction for all other employees and executive leadership late in the third quarter.”
Rave Restaurant Group’s revenues for the third quarter decreased 12% to $2.7 million, down from $3.1 million a year earlier. Rave recorded a net income loss of $4.5 million or a loss of .30 cents per share, up from a loss of $.3 million or $0.02 cents per share a year earlier.
Pizza Inn, as a buffet business, was “particularly challenged” by the coronavirus pandemic, according to Solano, and the brand launched their contactless buffet to-go — “a customized buffet option in the comfort and safety of their own homes” — as well as their “Right Way Buffet” plan for Pizza Inns that began opening their dining rooms last month.
Pie Five, meanwhile, took the brunt of the financial challenges during the third quarter and start of the COVID-19 pandemic.
"At Pie Five, we are continuing to work with franchisees to mitigate the effects of the pandemic," Solano said in a statement. "Although sales and traffic continue to reflect the impact of this crisis, we believe the investments we made in building a strong loyalty program, third-party delivery partnerships and digital capabilities have positioned us to stay connected to our consumers.
At the start of the pandemic, Rave Restaurant Group had just come off a disappointing second quarter with revenue decreases of 11.4%, as well as an executive team shakeup and announcement of new CEO Brandon Solano in October and Chief Operating Officer Mike Burns in November, both alums from Pei Wei Asian Kitchen.
At the time, Solano said they were exploring a “comprehensive turnaround strategy” of consumer research and brand differentiation: a plan that was thrown off course during the COVID-19 pandemic just a month later.
In the third quarter of fiscal 2020, Pie Five closed a net ten domestic stores, for a total store count of 43 restaurants. Pie Five currently has 32 restaurants open and six temporary closures.
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