- Restaurant franchise Freshii (FRII) has taken a hit in the second quarter of 2020 after COVID-19 brought down the retail consumer sector
- The company reported a 221 per cent drop in net income, from a gain of almost C$574,000 in the second quarter of 2019 to a loss of more than $695,000 this year
- Total revenue also fell 55 per cent, from $7.66 million last year to $3.42 million
- The disappointing results were driven largely by government-mandated shutdowns in accordance with COVID-19 mitigation policies
- Freshii (FRII) is currently up 2.14 per cent and is trading at $1.43 per share
Restaurant franchise Freshii (FRII) has taken a hit in the second quarter of 2020 after COVID-19 brought down the retail consumer sector.
The Toronto-based company reported a 221 per cent drop in net income for the period ending June 28, 2020, from a gain of almost C$574,000 in the same period of 2019 to a loss of more than $695,000 this year.
Likewise, revenue, which is made up of franchise revenue and company-owned store revenue, fell 55 per cent from a total of $7.66 million last year to just $3.42 million this year.
The downturn in financial performance was almost entirely attributed to the impact of COVID-19 and the related government-mandated shutdowns across many jurisdictions in Canada, the US, Central and South America. This resulted in a substantial decrease in customer traffic.
The number of affected locations fluctuated throughout the period and has continued to do so in to the third quarter. Roughly 52 per cent of Freshii’s locations worldwide had been suspended in mid-April, but with restrictions beginning to relax, approximately 80 per cent were operating with take-out and delivery options as of August 9.
Of the stores that remain closed, the majority are considered non-traditional locations, such as those in airports and on university campuses.
Matthew Corrin, Chairman and CEO of Freshii, said that while significant challenges persist, he is encouraged by a perceived improvement in reopening trends and corresponding sales.
“We remain focused on executing against our strategic agenda and making sound investments to support our franchisees, all while taking prudent steps to actively manage our strong cash position.
“We continue to be excited about our omnichannel growth, particularly with the recent addition of ONroute travel hubs to our retail distribution network, the continued progress and excitement around the development of Freshii’s dinner daypart, and the upcoming roll out of our new ordering and delivery app,” he added.
Freshii (FRII) is currently up 2.14 per cent and is trading at $1.43 per share at 1:25pm EDT.