Rocky Mountain Chocolate Factory(RMCF) - 2026 Q2 - Quarterly Results

Company Overview & Strategic Update This section outlines Rocky Mountain Chocolate Factory's profile and the CEO's strategic commentary on transformation and growth Company Profile Rocky Mountain Chocolate Factory, Inc. is a leading franchiser of premium chocolate and confectionery retail stores, operating over 250 locations globally - RMCF is America's Chocolatier, a leading franchiser of premium chocolate and confectionery retail stores, producing gourmet caramel apples since 1981[1][6] - The company operates over 250 Rocky Mountain Chocolate stores across the United States and internationally[6] - RMCF is headquartered in Durango, Colorado, and is listed on the Nasdaq Global Market under "RMCF"[1][6] CEO's Strategic Commentary Interim CEO Jeff Geygan highlighted initial progress in transformation and modernization, focusing on strengthening operations, scalable growth, and data-driven decisions - The company is undergoing a transformation and modernization, showing early signs of progress, with a focus on strengthening operations and scalable growth[2] - New ERP and POS systems are providing clearer insights into store performance and customer trends, enabling faster, data-driven decisions[2] - The company launched a rebrand and new store developments, including two new franchise locations in Folsom, CA, and New Jersey, and a company-owned location in Camarillo, CA, with a Chicago flagship expected around the holidays[2] - Future initiatives include introducing a new loyalty program and expanding digital capabilities to enhance customer connections[2] Fiscal Second Quarter 2026 Financial Highlights Key financial metrics for Q2 FY2026 are presented, covering revenue, gross profit, net loss, and earnings per share Key Financial Metrics (Q2 FY2026 vs. Year-Ago Quarter) Total revenue for Q2 FY2026 increased to $6.8 million, while product and retail gross profit saw a loss, and net loss remained relatively flat Fiscal Second Quarter 2026 Financial Highlights (in thousands) | Metric | Q2 FY2026 | Q2 FY2025 | Change (YoY) | | :----------------------------- | :-------- | :-------- | :----------- | | Total Revenue | $6,823 | $6,380 | +$443 (+6.9%) | | Total Product & Retail Gross Profit | $(33) | $600 | -$633 (-105.5%) | | Total Costs & Expenses | $7,302 | $7,294 | +$8 (+0.1%) | | Net Loss | $(662) | $(722) | +$60 (-8.3%) | | Basic Loss per Common Share | $(0.09) | $(0.11) | +$0.02 | - Total revenue increase was attributed to pricing actions and a more profitable sales mix following the Company's exit from lower-margin specialty markets[7] - The decline in product and retail gross profit was due to higher input costs and operational inefficiencies, offsetting benefits from pricing actions and market exit[7] Detailed Financial Statements Detailed condensed consolidated balance sheets and statements of operations are presented Condensed Consolidated Balance Sheets As of August 31, 2025, total assets and liabilities increased, while stockholders' equity decreased Condensed Consolidated Balance Sheet Highlights (in thousands) | Metric | August 31, 2025 (Unaudited) | February 28, 2025 | Change (vs. Feb 28, 2025) | | :-------------------------- | :-------------------------- | :---------------- | :------------------------ | | Cash and cash equivalents | $2,017 | $720 | +$1,297 | | Total current assets | $10,183 | $9,223 | +$960 | | Total Assets | $22,254 | $21,175 | +$1,079 | | Total current liabilities | $6,651 | $6,869 | -$218 | | Notes payable | $7,766 | $5,957 | +$1,809 | | Total Liabilities | $16,128 | $14,200 | +$1,928 | | Total Stockholders' Equity | $6,126 | $6,975 | -$849 | Condensed Consolidated Statements of Operations Total revenue increased for both three and six-month periods, with significant improvements in loss from operations and net loss year-over-year Condensed Consolidated Statements of Operations Highlights (in thousands) | Metric (Three Months Ended Aug 31) | 2025 | 2024 | Change (YoY) | | :--------------------------------- | :-------- | :-------- | :----------- | | Sales | $5,183 | $4,918 | +$265 (+5.4%) | | Franchise and royalty fees | $1,640 | $1,462 | +$178 (+12.2%) | | Total Revenue | $6,823 | $6,380 | +$443 (+6.9%) | | Loss from Operations | $(479) | $(914) | +$435 (-47.6%) | | Net Loss | $(662) | $(722) | +$60 (-8.3%) | | Basic Loss per Common Share | $(0.09) | $(0.11) | +$0.02 | | Metric (Six Months Ended Aug 31) | 2025 | 2024 | Change (YoY) | | Total Revenue | $13,196 | $12,787 | +$409 (+3.2%) | | Loss from Operations | $(624) | $(2,544) | +$1,920 (-75.5%) | | Net Loss | $(986) | $(2,380) | +$1,394 (-58.6%) | | Basic Loss per Common Share | $(0.13) | $(0.37) | +$0.24 | - Sales and franchise/royalty fees both contributed to the overall revenue increase for both the three-month and six-month periods[13] - Significant improvement in loss from operations and net loss for both periods indicates better cost management or operational efficiency compared to the prior year[13] Additional Information Details for the upcoming conference call, forward-looking statements, and investor contact are provided Conference Call Information A conference call to discuss financial results will be held on Tuesday, October 14, 2025, at 9:00 a.m. Eastern time, with dial-in and webcast details provided - A conference call to discuss financial results will be held on Tuesday, October 14, 2025, at 9:00 a.m. Eastern time[4] - Dial-in and live webcast registration links are available, and the call will be broadcast live and available for replay on the company's investor relations website[4][5] Forward-Looking Statements The press release includes forward-looking statements about future expectations, subject to various risks and uncertainties, with no obligation to update them - The press release includes forward-looking statements about future financial and operating results, business strategy, store pipeline, and transformation[8] - These statements are subject to various risks and uncertainties, including inflationary impacts, legal proceedings, changes in the confectionery business, seasonality, raw material costs, competition, and government regulations[8] - The company advises caution against undue reliance on forward-looking statements and does not undertake to update them unless legally required[8] Investor Contact Investor inquiries can be directed to Sean Mansouri, CFA, at Elevate IR, via phone or email - Investor contact: Sean Mansouri, CFA, Elevate IR, 720-330-2829, RMCF@elevate-ir.com[9]