Healthy Fast Food Announces Third Quarter 2009 Results
Healthy Fast Food Announces Third Quarter 2009 Results
U-SWIRL Frozen Yogurt® Stores Delivering Strong Operating Profits
HENDERSON, Nev., Nov. 17 - Healthy Fast Food, Inc. (BULLETIN BOARD: HFFI) , parent to U-SWIRL International, Inc., the owner and franchisor of U-SWIRL Frozen Yogurt® stores, today announced its financial and operational results for the three and nine months ended September 30, 2009.
Financial Highlights for Nine Months Ended September 30, 2009 Compared to Nine Months Ended September 30, 2008:
— U-Swirl Restaurants
— Total revenues from the U-SWIRL Frozen Yogurt operations were
$926,000. The Company launched its new U-SWIRL business in March
2009 with the opening of the first Company-owned store in Las
Vegas.
— Currently, the Company has a total of five (5) Company-owned
stores in operation and two (2) franchise /licensed stores in
operation.
— After factoring restaurant operating costs, including pre-opening
expenses related to staff training, supplies and grand-opening
promotions, U-SWIRL achieved an operating profit of $239,000.
— Fresh and Fast (formerly EVOS) Restaurants
— During the third quarter of 2009, Healthy Fast Food closed its two
Fresh and Fast (formerly EVOS) restaurants to focus strictly on
U-SWIRL’s national expansion strategy. As a result of the
closures, activities of the Fresh and Fast concept have been
accounted for as discontinued operations. Revenues from
discontinued operations totaled $469,000 compared to $524,000.
— After writing off all of the assets related to the Fresh and Fast
concept, the Company reported a loss from discontinued operations
of $1,155,000, up from $270,000.
— On a consolidated basis, net loss increased 100% to $1,786,000, or
$0.71 per basic and diluted share, compared to $892,000, or $0.40 per
basic and diluted share.
Financial Highlights for Three Months Ended September 30, 2009 Compared to Three Months Ended September 30, 2008:
— Total U-SWIRL revenues were $530,000 compared to $0.
— U-Swirl restaurant operating profits in the third quarter 2009
were $125,000.
— After factoring corporate expenses and $1.03 million in net costs
stemming from the divestiture of the Fresh and Fast concept, net loss
was $1,234,000, or $0.49 per basic and diluted share, compared to a
net loss of $395,000, or $0.18 per basic and diluted share.
As of September 30, 2009, Healthy Fast Food had cash and cash equivalents of $726,000, working capital of $588,000 and total stockholders’ equity of $2,375,000.
“Healthy Fast Food was extraordinarily productive in the third quarter, accomplishing a number of key objectives essential to supporting the national expansion of our exciting and profitable U-SWIRL concept. This included closing the chapter on Fresh and Fast, which has freed us to concentrate solely on implementing strategies to build U-SWIRL into a respected industry brand and successful national franchise system,” stated Hank Cartwright, Chairman and CEO of Healthy Fast Food. “In addition to expanding the U-Swirl network to seven stores, we also signed our first franchise agreement for the development of U-Swirl franchise locations in Reno, Nevada. Judging by our latest store opening in Reno, our self-serve concept and quality frozen treat offerings continue to be a resounding hit with local consumers.”
Continuing, Cartwright noted, “Since mid-August, we started the expansion of our senior management team with the welcome addition of Rich Ungaro, a highly accomplished industry veteran, as our new Chief Operating Officer. In addition, in October we named Phil deMena, an industry recognized real estate expert as our new outsourced VP of Real Estate.”
“With the fourth quarter well underway, our progress has not slowed by any measure. What’s more, we have recently initiated construction on our sixth Company-owned store in Las Vegas and signed a franchise area development agreement for the Phoenix metro market, under which the new developer has committed to open a minimum of 18 new U-SWIRL Frozen Yogurt stores over the next five years. With 2010 fast approaching, we are very optimistic about U-SWIRL’s promising outlook and are excited by the many expansion opportunities that we are actively pursuing,” concluded Cartwright.
HEALTHY FAST FOOD, INC.
CONDENSED CONSOLIDATED BALANCE SHEET
Unaudited Audited
Sept. 30, 2009 Dec. 31, 2008
ASSETS
Current assets
Cash and equivalents $725,916 $3,335,740
Tenant improvement allowance receivable 10,335 -
Due from U-Create Enterprises, Inc. 1,134 -
Inventory 74,492 15,100
Prepaid expenses 32,269 23,495
Current assets from discontinued operations 6,916 100,113
Total current assets 851,062 3,474,448
Leasehold improvements, property and
equipment, net 1,900,834 64,586
Leasehold improvements, property and
equipment from discontinued operations,
net - 814,849
Other assets
Deposits 108,572 5,400
Other assets from discontinued operations 85,350 159,839
Total other assets 193,922 165,239
Total assets $2,945,818 $4,519,122
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Accounts payable and accrued liabilities $ 75,308 $62,781
Accounts payable and accrued liabilities
from discontinued operations 183,514 110,202
Current portion of long-term debt 4,649 4,203
Total current liabilities 263,471 177,186
Deferred rent 220,021 20,059
Long-term capital lease 11,406 14,951
Long-term liabilities from discontinued
operations 76,145 187,423
Total liabilities 571,043 399,619
Commitments and contingencies
Stockholders’ equity
Preferred stock; $0.001 par value;
25,000,000 shares authorized,
no shares issued and outstanding - -
Common stock; $0.001 par value;
100,000,000 shares authorized,
2,523,350 shares issued and
outstanding at 9/30/09 and 12/31/08 2,523 2,518
Additional paid-in capital 6,835,653 6,794,179
Stock subscriptions receivable (150) (150)
Compensation payable in stock 21 -
Deficit (4,463,272) (2,677,044)
Total stockholders’ equity 2,374,775 4,119,503
Total liabilities and stockholders’
equity $2,945,818 $4,519,122
HEALTHY FAST FOOD, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
Unaudited Unaudited
For the three months For the nine months
ended ended
Sept. 30, Sept. 30, Sept. 30, Sept. 30,
2009 2008 2009 2008
Revenues
Restaurant sales, net of
discounts $515,332 $- $910,603 $-
Franchise royalties and
fees 15,000 - 15,000 -
Total revenues 530,332 - 925,603 -
Restaurant operating costs
Food, beverage and packaging
costs 152,574 - 267,523 -
Labor and related expenses 138,561 - 247,062 -
Occupancy and related
expenses 99,656 2,394 156,758 6,742
Marketing and advertising 74,342 10,675 106,145 28,735
General and administrative 176,797 60,661 408,111 173,646
Officer compensation 50,726 43,331 294,775 122,678
Investor relations fees - 23,398 - 154,740
Intellectual property acquired
from related parties - 180,000 - 180,000
Depreciation and
amortization 44,673 201 82,039 603
Total costs and expenses 737,329 320,660 1,562,413 667,144
Loss from operations (206,997) (320,660) (636,810) (667,144)
Interest expense (570) (700) (1,810) (2,723)
Interest income 1,422 21,189 7,445 48,097
Loss from continuing
operations before
income taxes (206,145) (300,171) (631,175) (621,770)
Provision for income taxes - - - -
Loss from continuing
operations (206,145) (300,171) (631,175) (621,770)
Discontinued operations:
Loss from operations of
discontinued Fresh and
Fast restaurant component
(including loss on
disposal of $814,849) 1,027,467 94,637 1,155,053 270,249
Income tax benefit - - - -
Loss on discontinued
operations (1,027,467) (94,637) (1,155,053) (270,249)
Net loss $(1,233,612)$(394,808)$(1,786,228)$(892,019)
Earnings per share - basic
Loss from continuing
operations $(0.08) $(0.14) $(0.25) $(0.28)
Loss from discontinued
operations (0.41) (0.04) (0.46) (0.12)
Net loss per common share -
basic and fully diluted $(0.49) $(0.18) $(0.71) $(0.40)
Weighted average common shares
outstanding - basic and
diluted 2,518,350 2,211,246 2,518,350 2,211,246
ABOUT U-SWIRL INTERNATIONAL, INC.
U-SWIRL International is a wholly owned subsidiary of Healthy Fast Food, Inc., and is launching a national chain of self-serve frozen yogurt stores called U-SWIRL Frozen Yogurt®. U-SWIRL allows guests the ultimate choice in frozen yogurt by providing up to 20 non-fat flavors, including tart, traditional, no sugar-added options, and more than 60 toppings, including seasonal fresh fruit, sauces, candy and granola. Guests serve themselves and pay by the ounce instead of by the cup size. A healthier alternative to a coffee shop hang out, locations are furnished with couches and tables, and patio seating. In addition to its development of Company-owned stores, U-SWIRL International has also launched its franchise program to roll out the concept nationwide in those states in which the Company is qualified to offer franchises.
ABOUT HEALTHY FAST FOOD, INC.
Headquartered in Henderson, Nevada, Healthy Fast Food, Inc. is on a mission to deliver consumers a smarter alternative to America’s favorite meals and snacks. In September 2008, the Company and its wholly-owned subsidiary, U-Swirl International, Inc., acquired the worldwide rights to the U-Swirl Frozen Yogurt system. Sole ownership of the system was transferred to U-Swirl International, Inc., and it has been executing an aggressive strategy to build the brand into a globally recognized chain of highly experiential frozen yogurt stores.
Safe Harbor Statement
This press release contains forward-looking statements regarding the timing and financial impact of the Healthy Fast Food, Inc.‘s ability to implement its business plan, expected revenues and future success. These statements involve a number of risks and uncertainties and are based on assumptions involving judgments with respect to future economic, competitive and market conditions and future business decisions, all of which are difficult or impossible to predict accurately and many of which are beyond the Company’s control. Some of the important factors that could cause actual results to differ materially from those indicated by the forward-looking statements are general economic conditions, failure to achieve expected revenue growth, changes in our operating expenses, legal developments, competitive pressures, changes in customer and market requirements and standards, and the risk factors detailed from time to time in Healthy Fast Food’s periodic filings with the Securities and Exchange Commission, including without limitation, the Company’s Annual Report for the year ended December 31, 2008. The forward looking-statements in this press release are based upon management’s reasonable belief as of the date hereof. Healthy Fast Food undertakes no obligation to revise or update publicly any forward-looking statements for any reason.
FOR MORE INFORMATION, PLEASE CONTACT
Elite Financial Communications Group, LLC
Dodi Handy, President and CEO (Twitter: @dodihandy) or
Kathy Addison, Director of Elite Media Group (Twitter: @kathyaddison)
407-585-1080 or via email at .(JavaScript must be enabled to view this email address)
Source: Healthy Fast Food, Inc.
CONTACT: Elite Financial Communications Group, LLC, Dodi Handy,
President and CEO (Twitter: @dodihandy), or Kathy Addison, Director of Elite
Media Group (Twitter: @kathyaddison), +1-407-585-1080, .(JavaScript must be enabled to view this email address)