We could not find any results for:
Make sure your spelling is correct or try broadening your search.
Share Name | Share Symbol | Market | Type |
---|---|---|---|
Freshworks Inc | NASDAQ:FRSH | NASDAQ | Common Stock |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 18.42 | 18.00 | 19.45 | 0 | 14:20:59 |
Delaware
(State or Other Jurisdiction of
Incorporation or Organization)
|
|
27-2349094
(IRS Employer
Identification No.)
|
8000 NE Parkway Drive, Suite 350
Vancouver, WA
(Address of principal executive offices)
|
|
98662
(Zip Code)
|
Large accelerated filer [ ]
|
|
Accelerated filer [X]
|
Non-accelerated filer [ ]
|
|
Smaller reporting company [ ]
|
|
|
Emerging growth company [X]
|
|
|
|
|
|
|
|
||
|
||
|
||
|
||
|
|
|
|
|
|
|
|
|
Papa Murphy’s Holdings, Inc. and Subsidiaries
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
(In thousands, except share and per share data)
|
July 3, 2017
|
|
June 27, 2016
|
|
July 3, 2017
|
|
June 27, 2016
|
||||||||
Revenues
|
|
|
|
|
|
|
|
||||||||
Franchise royalties
|
$
|
9,101
|
|
|
$
|
9,538
|
|
|
$
|
19,135
|
|
|
$
|
20,034
|
|
Franchise and development fees
|
837
|
|
|
574
|
|
|
1,438
|
|
|
1,528
|
|
||||
Company-owned store sales
|
18,715
|
|
|
19,470
|
|
|
39,490
|
|
|
40,144
|
|
||||
Other
|
449
|
|
|
312
|
|
|
1,033
|
|
|
1,173
|
|
||||
Total revenues
|
29,102
|
|
|
29,894
|
|
|
61,096
|
|
|
62,879
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Costs and Expenses
|
|
|
|
|
|
|
|
||||||||
Store operating costs:
|
|
|
|
|
|
|
|
||||||||
Cost of food and packaging
|
6,303
|
|
|
6,781
|
|
|
13,518
|
|
|
14,053
|
|
||||
Compensation and benefits
|
5,923
|
|
|
5,577
|
|
|
12,257
|
|
|
11,311
|
|
||||
Advertising
|
2,113
|
|
|
1,897
|
|
|
4,241
|
|
|
4,063
|
|
||||
Occupancy
|
2,314
|
|
|
1,503
|
|
|
4,015
|
|
|
2,878
|
|
||||
Other store operating costs
|
1,955
|
|
|
2,555
|
|
|
4,177
|
|
|
4,846
|
|
||||
Selling, general, and administrative
|
3,408
|
|
|
5,912
|
|
|
20,621
|
|
|
14,967
|
|
||||
Depreciation and amortization
|
2,906
|
|
|
2,915
|
|
|
6,023
|
|
|
5,630
|
|
||||
Loss (gain) on disposal or impairment of property and equipment
|
11,041
|
|
|
(59
|
)
|
|
11,050
|
|
|
(5
|
)
|
||||
Total costs and expenses
|
35,963
|
|
|
27,081
|
|
|
75,902
|
|
|
57,743
|
|
||||
Operating (Loss) Income
|
(6,861
|
)
|
|
2,813
|
|
|
(14,806
|
)
|
|
5,136
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Interest expense, net
|
1,286
|
|
|
1,208
|
|
|
2,513
|
|
|
2,387
|
|
||||
Other expense, net
|
48
|
|
|
43
|
|
|
92
|
|
|
85
|
|
||||
(Loss) Income Before Income Taxes
|
(8,195
|
)
|
|
1,562
|
|
|
(17,411
|
)
|
|
2,664
|
|
||||
|
|
|
|
|
|
|
|
||||||||
(Benefit from) provision for income taxes
|
(2,008
|
)
|
|
610
|
|
|
(5,810
|
)
|
|
1,070
|
|
||||
Net (Loss) Income
|
$
|
(6,187
|
)
|
|
$
|
952
|
|
|
$
|
(11,601
|
)
|
|
$
|
1,594
|
|
|
|
|
|
|
|
|
|
||||||||
(Loss) earnings per share of common stock
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
(0.37
|
)
|
|
$
|
0.06
|
|
|
$
|
(0.69
|
)
|
|
$
|
0.10
|
|
Diluted
|
$
|
(0.37
|
)
|
|
$
|
0.06
|
|
|
$
|
(0.69
|
)
|
|
$
|
0.10
|
|
Weighted average common stock outstanding
|
|
|
|
|
|
|
|
||||||||
Basic
|
16,867,929
|
|
|
16,744,553
|
|
|
16,853,587
|
|
|
16,730,581
|
|
||||
Diluted
|
16,867,929
|
|
|
16,766,587
|
|
|
16,853,587
|
|
|
16,760,578
|
|
Papa Murphy’s Holdings, Inc. and Subsidiaries
|
(In thousands, except par value and share data)
|
July 3, 2017
|
|
January 2, 2017
|
||||
ASSETS
|
|
|
|
||||
Current Assets
|
|
|
|
||||
Cash and cash equivalents
|
$
|
1,539
|
|
|
$
|
2,069
|
|
Accounts receivable, net
|
2,957
|
|
|
5,330
|
|
||
Current portion of notes receivable
|
73
|
|
|
92
|
|
||
Inventories
|
809
|
|
|
917
|
|
||
Prepaid expenses and other current assets
|
2,402
|
|
|
4,708
|
|
||
Total current assets
|
7,780
|
|
|
13,116
|
|
||
Property and equipment, net
|
15,677
|
|
|
28,516
|
|
||
Notes receivable, net of current portion
|
34
|
|
|
57
|
|
||
Goodwill
|
107,751
|
|
|
108,470
|
|
||
Trade name and trademarks
|
87,002
|
|
|
87,002
|
|
||
Definite-life intangibles, net
|
33,928
|
|
|
36,313
|
|
||
Other assets
|
363
|
|
|
398
|
|
||
Total assets
|
$
|
252,535
|
|
|
$
|
273,872
|
|
|
|
|
|
||||
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
|
||||
Current Liabilities
|
|
|
|
||||
Accounts payable
|
$
|
5,024
|
|
|
$
|
6,160
|
|
Accrued expenses and other current liabilities
|
8,652
|
|
|
7,503
|
|
||
Current portion of unearned franchise and development fees
|
1,091
|
|
|
1,358
|
|
||
Current portion of long-term debt
|
8,400
|
|
|
7,879
|
|
||
Total current liabilities
|
23,167
|
|
|
22,900
|
|
||
Long-term debt, net of current portion
|
96,432
|
|
|
100,965
|
|
||
Unearned franchise and development fees, net of current portion
|
450
|
|
|
410
|
|
||
Deferred tax liability
|
38,023
|
|
|
44,179
|
|
||
Other long-term liabilities
|
4,167
|
|
|
3,922
|
|
||
Total liabilities
|
162,239
|
|
|
172,376
|
|
||
Commitments and contingencies (Note 15)
|
|
|
|
|
|
||
|
|
|
|
||||
Stockholders’ Equity
|
|
|
|
||||
Preferred stock ($0.01 par value; 15,000,000 shares authorized; no shares issued)
|
—
|
|
|
—
|
|
||
Common stock ($0.01 par value; 200,000,000 shares authorized; 16,948,969 and 16,955,970 shares issued, respectively)
|
169
|
|
|
170
|
|
||
Additional paid-in capital
|
120,334
|
|
|
119,932
|
|
||
Accumulated deficit
|
(30,207
|
)
|
|
(18,606
|
)
|
||
Total stockholders’ equity
|
90,296
|
|
|
101,496
|
|
||
Total liabilities and stockholders’ equity
|
$
|
252,535
|
|
|
$
|
273,872
|
|
Papa Murphy’s Holdings, Inc. and Subsidiaries
|
|
Six Months Ended
|
||||||
(In thousands)
|
July 3, 2017
|
|
June 27, 2016
|
||||
Operating Activities
|
|
|
|
||||
Net (loss) income
|
$
|
(11,601
|
)
|
|
$
|
1,594
|
|
Adjustments to reconcile to cash from operating activities
|
|
|
|
||||
Depreciation and amortization
|
6,023
|
|
|
5,630
|
|
||
Loss (gain) on disposal/impairment of property and equipment
|
11,050
|
|
|
(5
|
)
|
||
Deferred taxes
|
(6,156
|
)
|
|
232
|
|
||
Stock-based compensation
|
405
|
|
|
427
|
|
||
Other non-cash items
|
259
|
|
|
158
|
|
||
Change in operating assets and liabilities
|
|
|
|
||||
Accounts receivable
|
2,373
|
|
|
1,984
|
|
||
Prepaid expenses and other assets
|
1,620
|
|
|
1,072
|
|
||
Unearned franchise and development fees
|
(226
|
)
|
|
(347
|
)
|
||
Accounts payable
|
(1,481
|
)
|
|
(3,840
|
)
|
||
Accrued expenses and other liabilities
|
1,398
|
|
|
(1,520
|
)
|
||
Net cash from operating activities
|
3,664
|
|
|
5,385
|
|
||
|
|
|
|
||||
Investing Activities
|
|
|
|
||||
Acquisition of property and equipment
|
(2,259
|
)
|
|
(9,533
|
)
|
||
Acquisition of stores, less cash acquired
|
—
|
|
|
(2,449
|
)
|
||
Proceeds from sale of stores
|
2,206
|
|
|
136
|
|
||
Payments received on notes receivable
|
42
|
|
|
37
|
|
||
Net cash from investing activities
|
(11
|
)
|
|
(11,809
|
)
|
||
|
|
|
|
||||
Financing Activities
|
|
|
|
||||
Payments on term loan
|
(5,779
|
)
|
|
(3,321
|
)
|
||
Advances on revolver
|
10,500
|
|
|
10,300
|
|
||
Payments on revolver
|
(8,900
|
)
|
|
(7,300
|
)
|
||
Repurchases of common stock
|
(4
|
)
|
|
(80
|
)
|
||
Proceeds from exercise of stock options
|
—
|
|
|
293
|
|
||
Payments received on subscription receivables
|
—
|
|
|
100
|
|
||
Net cash from financing activities
|
(4,183
|
)
|
|
(8
|
)
|
||
|
|
|
|
||||
Net change in cash and cash equivalents
|
(530
|
)
|
|
(6,432
|
)
|
||
Cash and Cash Equivalents, beginning of year
|
2,069
|
|
|
6,867
|
|
||
Cash and Cash Equivalents, end of period
|
$
|
1,539
|
|
|
$
|
435
|
|
|
|
|
|
||||
Supplemental Disclosures of Cash Flow Information
|
|
|
|
||||
Cash paid during the period for interest
|
$
|
2,389
|
|
|
$
|
2,243
|
|
Cash (received) paid during the period for income taxes
|
(275
|
)
|
|
136
|
|
||
Non-cash Supplemental Disclosures of Investing and Financing Activities
|
|
|
|
||||
Acquisition of property and equipment in accounts payable
|
$
|
259
|
|
|
$
|
2,509
|
|
Papa Murphy’s Holdings, Inc. and Subsidiaries
|
Note 1 — Description of Business and Basis of Presentation
|
Note 2 — Prepaid Expenses and Other Current Assets
|
(in thousands)
|
July 3, 2017
|
|
January 2, 2017
|
||||
Prepaid media production costs
|
$
|
—
|
|
|
$
|
606
|
|
Prepaid software and support
|
1,010
|
|
|
985
|
|
||
Prepaid rents
|
560
|
|
|
622
|
|
||
Prepaid insurance
|
59
|
|
|
453
|
|
||
Taxes receivable
|
—
|
|
|
547
|
|
||
Assets held for sale
|
525
|
|
|
1,406
|
|
||
Advertising cooperative assets, restricted
|
78
|
|
|
48
|
|
||
Other
|
170
|
|
|
41
|
|
||
Total prepaid expenses and other current assets
|
$
|
2,402
|
|
|
$
|
4,708
|
|
Note 3 — Property and Equipment
|
Note 4 — Divestitures
|
Note 5 — Goodwill
|
(in thousands)
|
Domestic
Company Stores
|
|
Domestic
Franchise
|
|
Total
|
||||||
Balance at January 2, 2017
|
$
|
26,924
|
|
|
$
|
81,546
|
|
|
$
|
108,470
|
|
Disposition
|
(719
|
)
|
|
—
|
|
|
(719
|
)
|
|||
Balance at July 3, 2017
|
$
|
26,205
|
|
|
$
|
81,546
|
|
|
$
|
107,751
|
|
Note 6 — Intangible Assets
|
Note 7 — Receivables
|
Note 8 — Financing Arrangements
|
(in thousands)
|
July 3, 2017
|
|
January 2, 2017
|
||||
Term loan
|
$
|
100,100
|
|
|
$
|
105,879
|
|
Revolving line of credit
|
2,400
|
|
|
800
|
|
||
Notes payable
|
3,000
|
|
|
3,000
|
|
||
Total principal amount of long-term debt
|
105,500
|
|
|
109,679
|
|
||
Unamortized debt issuance costs
|
(668
|
)
|
|
(835
|
)
|
||
Total long-term debt
|
104,832
|
|
|
108,844
|
|
||
Less current portion
|
(8,400
|
)
|
|
(7,879
|
)
|
||
Total long-term debt, net of current portion
|
$
|
96,432
|
|
|
$
|
100,965
|
|
Note 9 — Fair Value Measurement
|
▪
|
Level 1 — Quoted prices in active markets for identical assets or liabilities that the entity has the ability to access.
|
▪
|
Level 2 — Observable inputs other than prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are observable or can be corroborated with observable market data.
|
▪
|
Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets and liabilities. This includes certain pricing models, discounted cash flow methodologies, and similar techniques that use significant unobservable inputs.
|
|
July 3, 2017
|
|
January 2, 2017
|
|
|
||||||||||||
(in thousands)
|
Carrying Value
|
|
Fair Value
|
|
Carrying Value
|
|
Fair Value
|
|
Fair Value Measurement
|
||||||||
Financial assets
|
|
|
|
|
|
|
|
|
|
||||||||
Notes receivable
(1)
|
$
|
107
|
|
|
$
|
103
|
|
|
$
|
149
|
|
|
$
|
150
|
|
|
Level 3
|
(1)
|
The fair value of notes receivable was estimated primarily using a discounted cash flow method based on a discount rate, reflecting the applicable credit spread.
|
Note 10 — Accrued Expenses and Other Current Liabilities
|
(in thousands)
|
July 3, 2017
|
|
January 2, 2017
|
||||
Accrued compensation and related costs
|
$
|
3,951
|
|
|
$
|
2,192
|
|
Gift cards payable
|
2,344
|
|
|
3,033
|
|
||
Accrued interest and non-income taxes payable
|
382
|
|
|
524
|
|
||
Convention fund balance
|
827
|
|
|
1,025
|
|
||
Advertising cooperative liabilities
|
148
|
|
|
204
|
|
||
Income taxes payable
|
75
|
|
|
—
|
|
||
Other
|
925
|
|
|
525
|
|
||
Total accrued expenses and other current liabilities
|
$
|
8,652
|
|
|
$
|
7,503
|
|
Note 11 — Income Taxes
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
(in thousands)
|
July 3, 2017
|
|
June 27, 2016
|
|
July 3, 2017
|
|
June 27, 2016
|
||||||||
(Benefit from) provision for income taxes
|
$
|
(2,008
|
)
|
|
$
|
610
|
|
|
$
|
(5,810
|
)
|
|
$
|
1,070
|
|
(Loss) income before income taxes
|
(8,195
|
)
|
|
1,562
|
|
|
(17,411
|
)
|
|
2,664
|
|
||||
Effective income tax rate
|
24.5
|
%
|
|
39.1
|
%
|
|
33.4
|
%
|
|
40.2
|
%
|
Note 12 — Share-based Compensation
|
|
Number of Shares of Restricted Common Stock
|
|
Weighted Average
Award Date
Fair Value Per Share
|
||||||
|
Time Vesting
|
|
Market Condition
|
|
|||||
Unvested, January 2, 2017
|
30,670
|
|
|
148,946
|
|
|
$
|
2.70
|
|
Granted
|
11,333
|
|
|
—
|
|
|
4.41
|
|
|
Vested
|
(20,580
|
)
|
|
(94,866
|
)
|
|
4.78
|
|
|
Repurchased
|
—
|
|
|
(3,772
|
)
|
|
0.19
|
|
|
Unvested, July 3, 2017
|
21,423
|
|
|
50,308
|
|
|
$
|
4.09
|
|
|
Number of Shares
Subject to Options
|
|
Weighted
Average Exercise Price Per Share |
|
Weighted
Average Remaining Contractual Term |
|
Aggregate
Intrinsic Value (thousands) |
||||||||
|
Time
Vesting
|
|
Market
Condition
|
|
|
|
|||||||||
Outstanding, January 2, 2017
|
951,688
|
|
|
171,495
|
|
|
$
|
11.48
|
|
|
|
|
|
||
Granted
|
308,000
|
|
|
—
|
|
|
4.01
|
|
|
|
|
|
|||
Forfeited
|
(506,808
|
)
|
|
(83,276
|
)
|
|
11.34
|
|
|
|
|
|
|||
Outstanding, July 3, 2017
|
752,880
|
|
|
88,219
|
|
|
$
|
8.84
|
|
|
8.1 years
|
|
$
|
118
|
|
Exercisable, July 3, 2017
|
285,500
|
|
|
—
|
|
|
$
|
11.36
|
|
|
7.2 years
|
|
$
|
—
|
|
Note 13 — Advertising Fund
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
(in thousands)
|
July 3, 2017
|
|
June 27, 2016
|
|
July 3, 2017
|
|
June 27, 2016
|
||||||||
Opening fund balance (deficit)
|
$
|
(9,872
|
)
|
|
$
|
(2,324
|
)
|
|
$
|
(1,586
|
)
|
|
$
|
(1,200
|
)
|
Net activity during the period
|
2,792
|
|
|
387
|
|
|
(5,494
|
)
|
|
(737
|
)
|
||||
Ending fund balance (deficit)
|
$
|
(7,080
|
)
|
|
$
|
(1,937
|
)
|
|
$
|
(7,080
|
)
|
|
$
|
(1,937
|
)
|
Note 14 — Earnings per Share (EPS)
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
(in thousands, except per share data)
|
July 3, 2017
|
|
June 27, 2016
|
|
July 3, 2017
|
|
June 27, 2016
|
||||||||
Earnings:
|
|
|
|
|
|
|
|
||||||||
Net (loss) income
|
$
|
(6,187
|
)
|
|
$
|
952
|
|
|
$
|
(11,601
|
)
|
|
$
|
1,594
|
|
Shares:
|
|
|
|
|
|
|
|
||||||||
Weighted average common shares outstanding
|
16,868
|
|
|
16,745
|
|
|
16,854
|
|
|
16,731
|
|
||||
Dilutive effect of restricted equity awards
(1)
|
—
|
|
|
22
|
|
|
—
|
|
|
30
|
|
||||
Diluted weighted average number of shares outstanding
|
16,868
|
|
|
16,767
|
|
|
16,854
|
|
|
16,761
|
|
||||
(Loss) earnings per share:
|
|
|
|
|
|
|
|
||||||||
Basic (loss) earnings per share
|
$
|
(0.37
|
)
|
|
$
|
0.06
|
|
|
$
|
(0.69
|
)
|
|
$
|
0.10
|
|
Diluted (loss) earnings per share
|
$
|
(0.37
|
)
|
|
$
|
0.06
|
|
|
$
|
(0.69
|
)
|
|
$
|
0.10
|
|
(1)
|
The Company’s securities that provide a right to receive common stock in the future such as stock options and restricted stock were not included in the computation of diluted EPS for the three and six months ended July 3, 2017, as the effect of including these shares in the calculation would have been anti-dilutive.
|
Note 15 — Commitments and Contingencies
|
Note 16 — Segment Information
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
(in thousands)
|
July 3, 2017
|
|
June 27, 2016
|
|
July 3, 2017
|
|
June 27, 2016
|
||||||||
Revenues
|
|
|
|
|
|
|
|
||||||||
Domestic Franchise
|
$
|
10,292
|
|
|
$
|
10,337
|
|
|
$
|
21,421
|
|
|
$
|
22,552
|
|
Domestic Company Stores
|
18,714
|
|
|
19,470
|
|
|
39,490
|
|
|
40,144
|
|
||||
International
|
96
|
|
|
87
|
|
|
185
|
|
|
183
|
|
||||
Total
|
$
|
29,102
|
|
|
$
|
29,894
|
|
|
$
|
61,096
|
|
|
$
|
62,879
|
|
Segment Adjusted EBITDA
|
|
|
|
|
|
|
|
||||||||
Domestic Franchise
|
$
|
8,491
|
|
|
$
|
6,059
|
|
|
$
|
8,650
|
|
|
$
|
11,349
|
|
Domestic Company Stores
|
363
|
|
|
591
|
|
|
937
|
|
|
1,742
|
|
||||
International
|
91
|
|
|
78
|
|
|
160
|
|
|
142
|
|
||||
Total reportable segments adjusted EBITDA
|
8,945
|
|
|
6,728
|
|
|
9,747
|
|
|
13,233
|
|
||||
Corporate and unallocated
|
(1,062
|
)
|
|
(1,043
|
)
|
|
(4,538
|
)
|
|
(2,552
|
)
|
||||
Depreciation and amortization
|
(2,906
|
)
|
|
(2,915
|
)
|
|
(6,023
|
)
|
|
(5,630
|
)
|
||||
Interest expense, net
|
(1,286
|
)
|
|
(1,208
|
)
|
|
(2,513
|
)
|
|
(2,387
|
)
|
||||
CEO transition and restructuring
(1)
|
(131
|
)
|
|
—
|
|
|
(2,329
|
)
|
|
—
|
|
||||
E-commerce impairment
(2)
|
(9,124
|
)
|
|
—
|
|
|
(9,124
|
)
|
|
—
|
|
||||
Store closures
(3)
|
(2,631
|
)
|
|
—
|
|
|
(2,631
|
)
|
|
—
|
|
||||
(Loss) Income Before Income Taxes
|
$
|
(8,195
|
)
|
|
$
|
1,562
|
|
|
$
|
(17,411
|
)
|
|
$
|
2,664
|
|
(1)
|
Represents non-recurring management transition and restructuring costs in connection with the recruitment of a new Chief Executive Officer and other executive positions.
|
(2)
|
Represents impairment charges on the write-down of our e-commerce platform based on the decision to move to a third-party developed and hosted solution.
|
(3)
|
Represents primarily non-cash charges associated with the impairment and disposal of store assets upon the decision to close stores, plus lease loss reserves associated with related contractual lease obligations.
|
(in thousands)
|
July 3, 2017
|
|
January 2, 2017
|
||||
Total Assets
|
|
|
|
||||
Domestic Franchise
|
$
|
119,805
|
|
|
$
|
133,466
|
|
Domestic Company Stores
|
45,403
|
|
|
52,531
|
|
||
International
|
295
|
|
|
318
|
|
||
Other
(1)
|
87,032
|
|
|
87,557
|
|
||
Total
|
$
|
252,535
|
|
|
$
|
273,872
|
|
(1)
|
Other assets which are not allocated to the individual segments primarily include trade names and trademarks and taxes receivable.
|
2017 Highlights
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||
|
July 3, 2017
|
|
June 27, 2016
|
|
July 3, 2017
|
|
June 27, 2016
|
||||
Domestic Franchise
|
(4.1
|
)%
|
|
(3.7
|
)%
|
|
(4.3
|
)%
|
|
(3.3
|
)%
|
Domestic Company Stores
|
(6.6
|
)%
|
|
(6.6
|
)%
|
|
(8.4
|
)%
|
|
(4.7
|
)%
|
Total domestic stores
|
(4.3
|
)%
|
|
(4.0
|
)%
|
|
(4.7
|
)%
|
|
(3.4
|
)%
|
Our Segments
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
(in thousands)
|
July 3, 2017
|
|
June 27, 2016
|
|
July 3, 2017
|
|
June 27, 2016
|
||||||||
Revenues
|
|
|
|
|
|
|
|
||||||||
Domestic Franchise
|
$
|
10,292
|
|
|
$
|
10,337
|
|
|
$
|
21,421
|
|
|
$
|
22,552
|
|
Domestic Company Stores
|
18,714
|
|
|
19,470
|
|
|
39,490
|
|
|
40,144
|
|
||||
International
|
96
|
|
|
87
|
|
|
185
|
|
|
183
|
|
||||
Total
|
$
|
29,102
|
|
|
$
|
29,894
|
|
|
$
|
61,096
|
|
|
$
|
62,879
|
|
Segment Adjusted EBITDA
|
|
|
|
|
|
|
|
||||||||
Domestic Franchise
|
$
|
8,491
|
|
|
$
|
6,059
|
|
|
$
|
8,650
|
|
|
$
|
11,349
|
|
Domestic Company Stores
|
363
|
|
|
591
|
|
|
937
|
|
|
1,742
|
|
||||
International
|
91
|
|
|
78
|
|
|
160
|
|
|
142
|
|
||||
Total reportable segments adjusted EBITDA
|
8,945
|
|
|
6,728
|
|
|
9,747
|
|
|
13,233
|
|
||||
Corporate and unallocated
|
(1,062
|
)
|
|
(1,043
|
)
|
|
(4,538
|
)
|
|
(2,552
|
)
|
||||
Depreciation and amortization
|
(2,906
|
)
|
|
(2,915
|
)
|
|
(6,023
|
)
|
|
(5,630
|
)
|
||||
Interest expense, net
|
(1,286
|
)
|
|
(1,208
|
)
|
|
(2,513
|
)
|
|
(2,387
|
)
|
||||
CEO transition and restructuring
(1)
|
(131
|
)
|
|
—
|
|
|
(2,329
|
)
|
|
—
|
|
||||
E-commerce impairment
(2)
|
(9,124
|
)
|
|
—
|
|
|
(9,124
|
)
|
|
—
|
|
||||
Store closures
(3)
|
(2,631
|
)
|
|
—
|
|
|
(2,631
|
)
|
|
—
|
|
||||
(Loss) Income Before Income Taxes
|
$
|
(8,195
|
)
|
|
$
|
1,562
|
|
|
$
|
(17,411
|
)
|
|
$
|
2,664
|
|
(1)
|
Represents non-recurring management transition and restructuring costs in connection with the recruitment of a new Chief Executive Officer and other executive positions.
|
(2)
|
Represents impairment charges on the write-down of our e-commerce platform based on the decision to move to a third-party developed and hosted solution.
|
(3)
|
Represents primarily non-cash charges associated with the impairment and disposal of store assets upon the decision to close stores, plus lease loss reserves associated with related contractual lease obligations.
|
Key Operating Metrics
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
July 3, 2017
|
|
June 27, 2016
|
|
July 3, 2017
|
|
June 27, 2016
|
||||||||
Domestic store average weekly sales
|
$
|
10,167
|
|
|
$
|
10,759
|
|
|
$
|
10,656
|
|
|
$
|
11,342
|
|
Domestic comparable store sales
|
(4.3
|
)%
|
|
(4.0
|
)%
|
|
(4.7
|
)%
|
|
(3.4
|
)%
|
||||
Domestic comparable stores
|
1,440
|
|
|
1,410
|
|
|
1,440
|
|
|
1,410
|
|
||||
System-wide sales (in thousands)
|
$
|
204,536
|
|
|
$
|
215,253
|
|
|
$
|
430,146
|
|
|
$
|
452,104
|
|
System-wide stores
|
1,550
|
|
|
1,570
|
|
|
1,550
|
|
|
1,570
|
|
||||
Adjusted EBITDA (in thousands)
|
$
|
7,883
|
|
|
$
|
5,685
|
|
|
$
|
5,209
|
|
|
$
|
10,681
|
|
|
Domestic Company Stores
|
|
Domestic Franchise
|
|
Total Domestic
|
|
International
|
|
Total
|
|||||
Store count at January 2, 2017
|
168
|
|
|
1,369
|
|
|
1,537
|
|
|
40
|
|
|
1,577
|
|
Openings
|
—
|
|
|
17
|
|
|
17
|
|
|
3
|
|
|
20
|
|
Closings
|
(12
|
)
|
|
(35
|
)
|
|
(47
|
)
|
|
—
|
|
|
(47
|
)
|
Net transfers
(1)
|
(7
|
)
|
|
7
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Store count at July 3, 2017
|
149
|
|
|
1,358
|
|
|
1,507
|
|
|
43
|
|
|
1,550
|
|
(1)
|
Net transfers are the number of franchised stores acquired by the Company, less the number of Company-owned stores refranchised.
|
▪
|
in comparing our operating performance on a consistent basis;
|
▪
|
to calculate incentive compensation for our employees;
|
▪
|
for planning purposes, including the preparation of our internal annual operating budget; and
|
▪
|
to evaluate the performance and effectiveness of our operational strategies.
|
▪
|
Adjusted
EBITDA
does not reflect the significant interest expense, or the cash requirements necessary to service interest or principal payments, on our debt;
|
▪
|
Although depreciation and amortization are non-cash charges, the assets being depreciated and amortized may have to be replaced in the future, and Adjusted
EBITDA
does not reflect the cash requirements for such replacements; and
|
▪
|
Adjusted
EBITDA
does not reflect our tax expense or the cash requirements to pay our taxes.
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
(in thousands)
|
July 3, 2017
|
|
June 27, 2016
|
|
July 3, 2017
|
|
June 27, 2016
|
||||||||
Net (Loss) Income
|
$
|
(6,187
|
)
|
|
$
|
952
|
|
|
$
|
(11,601
|
)
|
|
$
|
1,594
|
|
Depreciation and amortization
|
2,906
|
|
|
2,915
|
|
|
6,023
|
|
|
5,630
|
|
||||
(Benefit from) provision for income taxes
|
(2,008
|
)
|
|
610
|
|
|
(5,810
|
)
|
|
1,070
|
|
||||
Interest expense, net
|
1,286
|
|
|
1,208
|
|
|
2,513
|
|
|
2,387
|
|
||||
EBITDA
|
$
|
(4,003
|
)
|
|
$
|
5,685
|
|
|
$
|
(8,875
|
)
|
|
$
|
10,681
|
|
CEO transition and restructuring
(1)
|
131
|
|
|
—
|
|
|
2,329
|
|
|
—
|
|
||||
E-commerce impairment
(2)
|
9,124
|
|
|
—
|
|
|
9,124
|
|
|
—
|
|
||||
Store closures
(3)
|
2,631
|
|
|
—
|
|
|
2,631
|
|
|
—
|
|
||||
Adjusted EBITDA
|
$
|
7,883
|
|
|
$
|
5,685
|
|
|
$
|
5,209
|
|
|
$
|
10,681
|
|
(1)
|
Represents non-recurring management transition and restructuring costs in connection with the recruitment of a new Chief Executive Officer and other executive positions.
|
(2)
|
Represents impairment charges on the write-down of our e-commerce platform based on the decision to move to a third-party developed and hosted solution.
|
(3)
|
Represents primarily non-cash charges associated with the impairment and disposal of store assets upon the decision to close stores, plus lease loss reserves associated with related contractual lease obligations.
|
Results of Operations
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||||||||||||||
|
July 3, 2017
|
|
June 27, 2016
|
|
July 3, 2017
|
|
June 27, 2016
|
||||||||||||||||||||
(in thousands)
|
$
|
|
Total
% of
Revenues
|
|
$
|
|
Total
% of Revenues |
|
$
|
|
Total
% of Revenues |
|
$
|
|
Total
% of Revenues |
||||||||||||
Revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Franchise royalties
|
$
|
9,101
|
|
|
31.3
|
%
|
|
$
|
9,538
|
|
|
32.0
|
%
|
|
$
|
19,135
|
|
|
31.3
|
%
|
|
$
|
20,034
|
|
|
31.9
|
%
|
Franchise and development fees
|
837
|
|
|
2.9
|
%
|
|
574
|
|
|
1.9
|
%
|
|
1,438
|
|
|
2.4
|
%
|
|
1,528
|
|
|
2.4
|
%
|
||||
Company-owned store sales
|
18,715
|
|
|
64.3
|
%
|
|
19,470
|
|
|
65.1
|
%
|
|
39,490
|
|
|
64.6
|
%
|
|
40,144
|
|
|
63.8
|
%
|
||||
Other
|
449
|
|
|
1.5
|
%
|
|
312
|
|
|
1.0
|
%
|
|
1,033
|
|
|
1.7
|
%
|
|
1,173
|
|
|
1.9
|
%
|
||||
Total revenues
|
29,102
|
|
|
100.0
|
%
|
|
29,894
|
|
|
100.0
|
%
|
|
61,096
|
|
|
100.0
|
%
|
|
62,879
|
|
|
100.0
|
%
|
||||
Costs and Expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Store operating costs:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Cost of food and packaging
(1)
|
6,303
|
|
|
21.5
|
%
|
|
6,781
|
|
|
22.8
|
%
|
|
13,518
|
|
|
22.1
|
%
|
|
14,053
|
|
|
22.3
|
%
|
||||
Compensation and benefits
(1)
|
5,923
|
|
|
20.4
|
%
|
|
5,577
|
|
|
18.7
|
%
|
|
12,257
|
|
|
20.1
|
%
|
|
11,311
|
|
|
18.0
|
%
|
||||
Advertising
(1)
|
2,113
|
|
|
7.3
|
%
|
|
1,897
|
|
|
6.3
|
%
|
|
4,241
|
|
|
6.9
|
%
|
|
4,063
|
|
|
6.5
|
%
|
||||
Occupancy
(1)
|
2,314
|
|
|
8.0
|
%
|
|
1,503
|
|
|
5.0
|
%
|
|
4,015
|
|
|
6.6
|
%
|
|
2,878
|
|
|
4.6
|
%
|
||||
Other store operating costs
(1)
|
1,955
|
|
|
6.7
|
%
|
|
2,555
|
|
|
8.5
|
%
|
|
4,177
|
|
|
6.8
|
%
|
|
4,846
|
|
|
7.7
|
%
|
||||
Selling, general, and administrative
(2)
|
3,408
|
|
|
11.8
|
%
|
|
5,912
|
|
|
19.7
|
%
|
|
20,621
|
|
|
33.7
|
%
|
|
14,967
|
|
|
23.7
|
%
|
||||
Depreciation and amortization
|
2,906
|
|
|
10.0
|
%
|
|
2,915
|
|
|
9.8
|
%
|
|
6,023
|
|
|
9.9
|
%
|
|
5,630
|
|
|
9.0
|
%
|
||||
Loss (gain) on disposal or impairment of property and equipment
|
11,041
|
|
|
37.9
|
%
|
|
(59
|
)
|
|
(0.2
|
)%
|
|
11,050
|
|
|
18.1
|
%
|
|
(5
|
)
|
|
0.0
|
%
|
||||
Total costs and expenses
|
35,963
|
|
|
123.6
|
%
|
|
27,081
|
|
|
90.6
|
%
|
|
75,902
|
|
|
124.2
|
%
|
|
57,743
|
|
|
91.8
|
%
|
||||
Operating (Loss) Income
|
(6,861
|
)
|
|
(23.6
|
)%
|
|
2,813
|
|
|
9.4
|
%
|
|
(14,806
|
)
|
|
(24.2
|
)%
|
|
5,136
|
|
|
8.2
|
%
|
||||
Interest expense, net
|
1,286
|
|
|
4.4
|
%
|
|
1,208
|
|
|
4.1
|
%
|
|
2,513
|
|
|
4.1
|
%
|
|
2,387
|
|
|
3.9
|
%
|
||||
Other expense, net
|
48
|
|
|
0.2
|
%
|
|
43
|
|
|
0.1
|
%
|
|
92
|
|
|
0.2
|
%
|
|
85
|
|
|
0.1
|
%
|
||||
(Loss) Income Before Income Taxes
|
(8,195
|
)
|
|
(28.2
|
)%
|
|
1,562
|
|
|
5.2
|
%
|
|
(17,411
|
)
|
|
(28.5
|
)%
|
|
2,664
|
|
|
4.2
|
%
|
||||
(Benefit from) provision for income taxes
|
(2,008
|
)
|
|
(6.9
|
)%
|
|
610
|
|
|
2.0
|
%
|
|
(5,810
|
)
|
|
(9.5
|
)%
|
|
1,070
|
|
|
1.7
|
%
|
||||
Net (Loss) Income
|
(6,187
|
)
|
|
(21.3
|
)%
|
|
952
|
|
|
3.2
|
%
|
|
(11,601
|
)
|
|
(19.0
|
)%
|
|
1,594
|
|
|
2.5
|
%
|
(1)
|
Please see the table presented in
Costs and Expenses
below, which presents Company-owned store expenses as a percentage of Company-owned store sales for the
three and six
months ended
July 3, 2017
, and
June 27, 2016
.
|
(2)
|
To the extent the advertising fund expenditures exceed contributions on a cumulative basis, the excess is recorded as an expense within selling, general and administrative expenses. In subsequent periods, previously recognized expenses will be recovered when contributions exceed expenditures on a cumulative basis, resulting in a reduction to selling, general, and administrative expenses. See
"Costs and Expenses—Selling, general, and administrative"
below for further discussion on current impacts of this policy.
|
•
|
Occupancy.
As a result of the increase in the number of Company-owned stores period-over-period, which was mostly in markets with lower AWS, costs that are primarily fixed at the individual store level, such as Occupancy, increased overall on an absolute dollar basis and as a percentage of Company-owned store sales. Additionally, $0.7 million in net charges were incurred in the
three and six
months ended
July 3, 2017
related to contractual lease obligations associated with store closures.
|
•
|
Compensation and benefits.
Compensation and benefits as a percentage of Company-owned store sales increased due to an increase in fixed labor costs such as store manager salaries, driven by the increase in the number of Company-owned stores period-over-period, mostly in markets with lower AWS. In addition, increases in the minimum wage has negatively affected several of our established markets.
|
▪
|
Other store operating costs.
Other store operating costs declined in the
three and six
months ended
July 3, 2017
, compared to the
three and six
months ended
June 27, 2016
, due primarily to a decrease in store pre-opening costs because the Company has not built or opened any Company-owned stores in 2017.
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
(in thousands)
|
July 3, 2017
|
|
June 27, 2016
|
|
July 3, 2017
|
|
June 27, 2016
|
||||||||
Opening fund balance (deficit)
|
$
|
(9,872
|
)
|
|
$
|
(2,324
|
)
|
|
$
|
(1,586
|
)
|
|
$
|
(1,200
|
)
|
Net activity during the period
|
2,792
|
|
|
387
|
|
|
(5,494
|
)
|
|
(737
|
)
|
||||
Ending fund balance (deficit)
|
$
|
(7,080
|
)
|
|
$
|
(1,937
|
)
|
|
$
|
(7,080
|
)
|
|
$
|
(1,937
|
)
|
Liquidity and Capital Resources
|
|
Six Months Ended
|
||||||
(in thousands)
|
July 3, 2017
|
|
June 27, 2016
|
||||
Cash flows from operating activities
|
$
|
3,664
|
|
|
$
|
5,385
|
|
Cash flows from investing activities
|
(11
|
)
|
|
(11,809
|
)
|
||
Cash flows from financing activities
|
(4,183
|
)
|
|
(8
|
)
|
||
Total cash flows
|
$
|
(530
|
)
|
|
$
|
(6,432
|
)
|
Critical Accounting Policies
|
Evaluation of Disclosure Controls and Procedures
|
Changes in Internal Control over Financial Reporting
|
|
Total Number of Shares Purchased
|
|
Average Price Paid per Share
|
|
Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs
|
|
Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs
|
||||
April 4 to April 30, 2017
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
N/A
|
May 1 to May 31, 2017
|
3,772
|
|
(1)
|
0.19
|
|
|
—
|
|
|
N/A
|
|
June 1, 2017 to July 3, 2017
|
—
|
|
|
—
|
|
|
—
|
|
|
N/A
|
|
Total
|
3,772
|
|
|
$
|
0.19
|
|
|
—
|
|
|
N/A
|
(1)
|
The Company repurchased unvested restricted shares from a former employee whose employment with the Company had terminated. The unvested shares were repurchased by the Company at the historical price paid by the former employee for the unvested shares.
|
Exhibit Number
|
Description of Exhibits
|
10.1*‡
|
Offer Letter dated June 9, 2017 from Papa Murphy's Holdings, Inc. to Weldon Spangler.
|
31.1*
|
Certification of the Chief Executive Officer Pursuant to Rule 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934, as amended, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
31.2*
|
Certification of the Chief Financial Officer Pursuant to Rule 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934, as amended, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
32.1*
|
Certificate of the Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
32.2*
|
Certificate of the Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
101.INS*
|
XBRL Instance Document
|
101.SCH*
|
XBRL Taxonomy Extension Schema Document
|
101.CAL*
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
101.DEF*
|
XBRL Taxonomy Extension Definition Linkbase Document
|
101.LAB*
|
XBRL Taxonomy Extension Label Linkbase Document
|
101.PRE*
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
PAPA MURPHY’S HOLDINGS, INC.
|
|||
|
|
|
|
By:
|
|
/s/ Mark Hutchens
|
|
|
|
Name:
|
Mark Hutchens
|
|
|
Title:
|
Chief Financial Officer
|
1 Year Freshworks Chart |
1 Month Freshworks Chart |
It looks like you are not logged in. Click the button below to log in and keep track of your recent history.
Support: +44 (0) 203 8794 460 | support@advfn.com
By accessing the services available at ADVFN you are agreeing to be bound by ADVFN's Terms & Conditions