Once seen as Dallas–based Rave Restaurant Group’s chain of the future, Pie Five Pizza Co. released earnings today from yet another disappointing quarter.
After reporting an impressive fourth quarter in 2014—during which same-store sales leaped 16.9 percent from the year prior—the fast-casual restaurant has yet to pull out of free-fall. Parent company Rave posted a consolidated revenue figure of $4.2 million, down 38.1 percent compared to Q2 in 2017.
At the center of that decline is Pie Five. Same-store sales took a 13.7 percent hit compared to the year prior, system-wide retail sales fell a whopping 18.8 percent, and Rave reported a loss of 4 cents per share during the quarter.
The silver lining for Pie Five investors amid the day’s news was an improvement in net loss over last year. That figure decreased from $7.9 million in the second quarter of 2017 to just $0.6 million this year. Of course, the decreased loss is the product of closing underperforming units and the overhead space created from halting operations.
In terms of total units, Pie Five hasn’t quite been able to right the ship, either. The brand’s darkest days came in 2017’s first quarter, when Pie Five shuttered 18 units, about 15 percent of the brand’s total. Before that round of cuts, Pie Five boasted 99 stores; following a net reduction of three units this quarter, that total stands at 80.
With resources split between company-run and franchised units, Scott Crane, Rave’s CEO, said in a statement that the brand is focusing on cutting losses and looking toward the future.
"We are diligently pursuing a refranchising strategy at Pie Five," Crane said. "This shift in our model allows us to focus on best-in-class support of our franchise community so that they can, in turn, provide a great guest experience."
Thankfully, there was some good news for another Rave pizza concept, the iconic Pizza Inn brand. Although total sales were down 3.3 percent domestically, same-store sales bulged 2.7 percent compared to this quarter last year.
The report of growth comes hot on the heels of the brand’s new Pizza Inn Express concept, a pie-pushing kiosk designed for convenience stores, travel plazas, and airports that Crane said he hopes will help the 60-year-old brand enter new markets around the country. Read more about it here.
"We are pleased that Pizza Inn continues to ride a growth trajectory with positive same store sales trends," said Crane. "We recently announced a new concept, P.I.E, developed as a complement to the brand refresh and expansion initiatives at Pizza Inn. This new concept allows Pizza Inn to diversify its footprint and is a great way to reach new customers in a faster setting, while still serving the same iconic, quality pizza our guests have come to expect."
Pie Five and its five-minute pizza option, founded in 2011, boomed above 100 stores before retracting. Now, the brand is hoping to try a few new tricks to build repeat business.
"We continue to see an opportunity to take advantage of growth in areas such as delivery, cauliflower pizza crusts, and shareable pizzas, with the goal of increasing frequency among our loyal guest base," Crane said.
According to PizzaToday’s 2017 ranking of the biggest pizza chains in the U.S., Rave’s combined pizza ventures are the 29th largest pizza “chain” in the country. It’s the only entity on the list that combines two separate chains.