Rocky Mountain Chocolate Factory Inc., which franchises and operates chocolate and self-serve frozen yogurt stores and manufactures an extensive line of premium chocolates and other confectionery products, reported its operating results for the first quarter of fiscal 2013.
For the three months ended May 31, 2012, total revenue increased 11.8 percent to approximately $9.7 million, compared with revenue of approximately $8.6 million in the first quarter of the previous fiscal year, due primarily to higher shipments of product to specialty market and franchise customers and an increase in retail sales.
Same-store sales at franchised retail outlets increased 1.1 percent versus the prior-year quarter.
Total factory sales increased 11.2 percent to approximately $6.5 million, versus approximately $5.8 million in the quarter ended May 31, 2011. The improvement in factory sales was primarily due to a 13.2 percent increase in shipments of product to customers outside the company's retail store network and a 10.3 percent increase in sales to domestic and international franchised and licensed stores.
Net income for the first quarter of FY13 increased 15.5 percent to $1 million, versus $919,659 in the corresponding period of the previous fiscal year.
Big international plans
Bryan Merryman, chief operating officer, said the company will continue to refine the Aspen Leaf Yogurt store footprint and business model, and will open the first co-branded Rocky Mountain Chocolate Factory/Aspen Leaf Yogurt store during the current quarter.
The most significant new development, he added, during the first quarter involved the company's entry into a master agreement with a strategic partner covering Japan.
"Our partner in this venture has extensive international experience operating retail units that sell confectionery products in Japan. We now have two stores open in Japan, where consumers have exhibited great enthusiasm for our brand and our products, and the agreement requires our strategic partner to open at least 10 new stores annually over the next 10 years, for a total of 100 stores in Japan by the expiration of the initial term of the agreement," Merryman said.
The agreement marks the launch of an aggressive international expansion program planned for Asia and other countries, and test stores are set to open in China later this fiscal year.
Also during the quarter, franchisees opened new Rocky Mountain Chocolate Factory stores in New Westminster, British Columbia; Tokyo, Japan; Pleasanton, Calif.; and Salt Lake City, Utah, along with Cold Stone Creamery co-branded stores in Rockaway, N.J., and West Lafayette, Ind. There are now a total of 51 Cold Stone Creamery co-branded stores open throughout the system.
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