Papa Murphy’s Holdings Inc. said Wednesday that same-store sales fell 2.8 percent at both franchised and company-owned locations in the first quarter ended March 28.
Net income fell 75 percent, to $642,000, or 4 cents per share, from $2.6 million, or 16 cents per share, in the same period a year ago.
“We are disappointed with our overall comparable-store sales performance in the first quarter and the resultant level of profitability,” Papa Murphy’s CEO Ken Calwell said in a statement. “We have identified and are taking action against specific areas of improvement and expect to demonstrate progress in the second half of the year.”
Revenue in the quarter increased 13.1 percent, to $33 million, from $29.2 million the previous year.
The company is working on technology initiatives, including online ordering, that it expects to generate sales in the coming months.
Papa Murphy’s launched its online ordering and e-commerce site in the first quarter, “providing us with a technology platform foundation for future growth,” Calwell said. Online ordering is offered at 82 percent of domestic units, with the full rollout expected in June.
Additionally, same-store sales in some of the chain’s less developed markets outperformed the system by 290 basis points, Calwell said. That’s important for the chain, which has worked to invest in advertising and new unit development in weaker markets where sales and profits have struggled.
Papa Murphy’s has more than 1,500 locations, and is based in Vancouver, Wash.