Rocky Mountain Chocolate Factory, Inc. (the “Company”) (Nasdaq: RMCF) yesterday reported record earnings per share of $.14 for the quarter ended February 28, 2001 compared to $.07 per share for the quarter ended February 29, 2000, an increase of 100%. The Company also reported record earnings per share for the year ended February 28, 2001 of $.77 compared to $.41 for the year ended February 29, 2000, an increase of 87.8%. When adjusted for the costs associated with the unsolicited tender offer in fiscal 2000, earnings per share increased 51% for fiscal 2001 versus the prior fiscal year. Net income increased 50% to $278,000 in the fourth quarter of fiscal 2001 from $186,000 in the fourth quarter of fiscal 2000. Net income increased 47.3% to a record $1,556,000 for fiscal 2001 from $1,057,000 in fiscal 2000. When adjusted for the costs associated with the unsolicited tender offer in fiscal 2000, net income increased 18.4% in fiscal 2001 versus the prior fiscal year.
Total revenues decreased 8.7% in the fourth quarter from $5,900,000 in fiscal 2000 to $5,400,000 in the fourth quarter of fiscal 2001 and 8.4% from $24,600,000 for the fiscal year ended February 29, 2000 to $22,600,000 for the fiscal year ended February 28, 2001. The decrease in retail sales resulted principally from a reduced number of Company-owned stores from 34 at February 29, 2000 to 14 at February 28, 2001 as the Company divests itself of its Company store program. Total revenues excluding retail sales increased 14.3% in the fourth quarter and 8.3% for the year ending February 28, 2001 versus the comparable periods of the prior fiscal year. On May 1, 2001, the Company completed franchising substantially all of its Company-owned stores in order to focus its resources on its franchise system. The Company has retained ownership in four Colorado stores in order to test sales, marketing, design and operational initiatives.
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On January 5, 2001, the Board of Directors approved the repurchase of an additional 100,000 shares of the Company’s outstanding common stock at an aggregate price of up to $500,000. To date, the Company has repurchased, pursuant to this program, 71,000 shares of its common stock on the open market for approximately $368,000. Additionally, from March 31, 2001 through April 19, 2001 the Company purchased approximately 45,000 shares of its common stock in private transactions for approximately $288,000.
Franklin E. Crail, President and CEO remarked, “Fiscal 2001 has been a year of further positioning the Company for profitable growth through franchising the Rocky Mountain Chocolate Factory store concept.” Mr. Crail added, “Interest in new franchises remains strong and is accelerating. Expected unit growth, incremental operating efficiencies and continued share buybacks should provide significant earnings per share growth in fiscal 2002. Currently, eleven new stores are under construction and four additional locations have signed lease agreements. We will also test our new store design and introduce new packaging in fiscal 2002, both of which we anticipate will have a positive impact on unit economics and same store sales.”
This press release contains forward-looking information that involves risks and uncertainties, and the Company undertakes no obligation to update any forward-looking information. Risks and uncertainties that could cause actual results to differ materially include, without limitation, the Company’s ability to franchise its Company-owned stores, seasonality, consumer interest in the company’s products, general economic conditions, consumer trends, costs and availability of raw materials, competition and the effect of government regulation.
Rocky Mountain Chocolate Factory, Inc. is an international franchiser of old-fashioned chocolate and confection stores and a manufacturer of an extensive line of premium chocolates and other confectionery products.
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