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Rocky Mountain Chocolate Factory Inc. (RMCF-16.35%) has submitted its 10-Q filing for the quarterly period ended November 30, 2024.
The filing indicates an increase in revenues to $7.9 million for the three months ended November 30, 2024, compared to $7.7 million for the same period in the previous year. The increase is attributed to price increases in Durango product and retail sales.
Cost of sales for the quarter was $6.0 million, representing 76.6% of sales, compared to 74.9% in the same quarter of the previous year. This increase in cost ratio is due to elevated raw material and labor costs.
The company reported a gross margin of $0.7 million for the quarter, compared to $0.7 million in the previous year, with the gross margin percentage slightly decreasing from 10.2% to 10.0%.
Franchise costs increased to $0.6 million from $0.6 million, primarily due to investments in franchise development. Sales and marketing expenses decreased to $0.3 million from $0.6 million, due to operational efficiencies and cost-cutting measures.
Net loss for the quarter was $0.8 million, consistent with the net loss of $0.8 million in the previous year. Basic loss per share decreased from $(0.12) to $(0.11).
Cash and cash equivalents decreased to $1.1 million as of November 30, 2024, from $2.1 million as of February 29, 2024, primarily due to cash used in operating activities.
The company entered into a new credit agreement with RMC Credit Facility, LLC for $6.0 million, which was used to repay the previous credit agreement and for working capital needs.
The filing also notes that the company continues to explore additional means of strengthening its liquidity position and ensuring compliance with its debt financing covenants.
Rocky Mountain Chocolate Factory Inc. does not anticipate cash dividend payments to common stockholders in the near future.
The company acknowledges its dependence on positive operating results and potential financing to meet future obligations.
This content was summarized by generative artificial intelligence using public filings retrieved from SEC.gov. The original data was derived from the Rocky Mountain Chocolate Factory Inc. quarterly 10-Q report dated January 15, 2025. To report an error, please email earnings@qz.com.