Thu, Jun 13, 8:10 PM (86 days ago)
**Rocky Mountain Chocolate Factory, Inc. (RMCF) Annual Report Summary** **Fiscal Year Ended: February 29, 2024** **Financial Performance:** - **Revenue:** Decreased by 8.2% from $30.4M in FY 2023 to $28.0M in FY 2024. - **Net Income:** Loss of $4.2M, a slight improvement from a loss of $5.7M in FY 2023. - **Operating Expenses:** Decreased by 7.1% to $32.7M. - **Earnings Per Share:** Loss of $(0.77) per share, an improvement from $(0.88) per share in the previous year. **Revenue Breakdown:** - **Durango Product and Retail Sales:** $22.0M, down 10.0%. - **Franchise Fees:** $167.8K, down 18.0%. - **Royalty and Marketing Fees:** $5.8M, relatively unchanged. **Strategic Overview:** - **Focus:** Continued focus on the confectionery business after divesting the frozen yogurt business. - **Expansion Strategy:** Targeting high pedestrian traffic environments and leveraging brand recognition. - **Operational Efficiency:** Increased investment in human capital and production efficiencies. **Future Outlook:** - **Challenges:** Inflationary pressures, supply chain disruptions, and labor shortages. - **Opportunities:** Increasing chocolate sales to franchisees and specialty markets, and potential sale of unused land. **Risk Factors:** - **Liquidity and Going Concern:** Substantial doubt about the ability to continue as a going concern due to recurring losses and negative cash flows. - **Debt Covenant Compliance:** Non-compliance with a financial covenant under the Credit Agreement, though a waiver was obtained. **Financial Condition:** - **Working Capital:** Decreased to $1.5M from $6.2M. - **Cash and Cash Equivalents:** Reduced to $2.1M from $4.7M. - **Credit Line:** $4.0M available, with $1.25M drawn. **Market Position:** - **Store Count:** 269 stores, including 2 company-owned, 115 licensee-owned, and 152 franchised stores across 36 states and the Philippines. This summary highlights the financial performance, strategic initiatives, and key risk factors impacting Rocky Mountain Chocolate Factory, Inc. during the fiscal year ended February 29, 2024.