UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D. C. 20549

FORM 10-Q

(Mark One)

☑

Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended December 29, 2024 or

☐

Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from ________ to ________.

Commission File Number: 0-12919

RAVE RESTAURANT GROUP, INC.

(Exact name of registrant as specified in its charter)


Missouri		45-3189287
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

3551 Plano Parkway

The Colony, Texas 75056

(Address of principal executive offices)

(Zip Code)

(469) 384-5000

(Registrant’s telephone number,

including area code)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $0.01 par value	RAVE	Nasdaq Capital Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☑ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☑ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☐	Accelerated filer ☐	Non-accelerated filer ☑	Smaller reporting company ☑
Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☑

As of January 30, 2025, 14,711,566 shares of the issuer’s common stock were outstanding.

RAVE RESTAURANT GROUP, INC.

Index

PART I. FINANCIAL INFORMATION

Item 1.	Financial Statements	Page

	Condensed Consolidated Statements of Income (unaudited) for the three and sixmonths ended December 29, 2024 and December 24, 2023	3

	Condensed Consolidated Balance Sheets at December 29, 2024 (unaudited) and June 30, 2024	4

	Condensed Consolidated Statements of Shareholders’ Equity (unaudited) for thethree and six months ended December 29, 2024 and December 24, 2023	5

	Condensed Consolidated Statements of Cash Flows (unaudited) for the six months ended December 29, 2024 and December 24, 2023	6

	Notes to Unaudited Condensed Consolidated Financial Statements	7

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	14

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	24

Item 4.	Controls and Procedures	24

PART II. OTHER INFORMATION

Item 1.	Legal Proceedings	25

Item 1A.	Risk Factors	25

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	25

Item 3.	Defaults Upon Senior Securities	25

Item 4.	Mine Safety Disclosures	25

Item 5.	Other Information	25

Item 6.	Exhibits	26

Signatures		27

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

RAVE RESTAURANT GROUP, INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(In thousands, except per share amounts)

(Unaudited)

	Three Months Ended						Six Months Ended
	December 29, 2024			December 24, 2023			December 29, 2024			December 24, 2023
REVENUES	$	2,869		$	2,746		$	5,919		$	5,833

COSTS AND EXPENSES
General and administrative expenses		1,314			1,341			2,730			2,660
Franchise expenses		829			844			1,824			2,016
Provision (recovery) for credit losses		9			10			(8	)		35
Interest income		(87	)		(46	)		(169	)		(48	)
Depreciation and amortization expense		53			57			96			112
Total costs and expenses		2,118			2,206			4,473			4,775
INCOME BEFORE TAXES		751			540			1,446			1,058
Income tax expense (benefit)		144			(13	)		313			119
NET INCOME	$	607		$	553		$	1,133		$	939

INCOME PER SHARE OF COMMON STOCK
Basic	$	0.04		$	0.04		$	0.08		$	0.07
Diluted	$	0.04		$	0.04		$	0.08		$	0.07

WEIGHTED AVERAGE COMMON SHARES OUTSTANDING
Basic		14,690			14,444			14,638			14,299
Diluted		14,716			14,465			14,660			14,319

See accompanying Notes to Unaudited Condensed Consolidated Financial Statements.

RAVE RESTAURANT GROUP, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except share amounts)

(Unaudited)

	December 29, 2024			June 30, 2024
ASSETS
CURRENT ASSETS
Cash and cash equivalents	$	2,871		$	2,886
Short-term investments		6,045			4,945
Accounts receivable, less allowance for credit losses of $42 and $57, respectively		1,115			1,411
Notes receivable, current		65			68
Assets held for sale		26			33
Deferred contract charges, current		23			26
Prepaid expenses and other current assets		207			167
Total current assets		10,352			9,536

LONG-TERM ASSETS
Property and equipment, net		171			182
Operating lease right-of-use assets, net		648			817
Intangible assets definite-lived, net		211			252
Notes receivable, net of current portion		56			79
Deferred tax asset, net		4,492			4,756
Deferred contract charges, net of current portion		185			197
Total assets	$	16,115		$	15,819

LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES
Accounts payable - trade	$	455		$	359
Accrued expenses		498			915
Operating lease liabilities, current		371			402
Deferred revenues, current		116			343
Total current liabilities		1,440			2,019

LONG-TERM LIABILITIES
Operating lease liabilities, net of current portion		393			555
Deferred revenues, net of current portion		503			543
Total liabilities		2,336			3,117

COMMITMENTS AND CONTINGENCIES (SEE NOTE C)

SHAREHOLDERS’ EQUITY
Common stock, $0.01 par value; authorized 26,000,000 shares; issued 25,647,171 and 25,522,171 shares, respectively; outstanding 14,711,566 and 14,586,566 shares, respectively		256			255
Additional paid-in capital		37,506			37,563
Retained earnings		6,045			4,912
Treasury stock, at cost
Shares in treasury: 10,935,605 and 10,935,605 respectively		(30,028	)		(30,028	)
Total shareholders' equity		13,779			12,702

Total liabilities and shareholders' equity	$	16,115		$	15,819

See accompanying Notes to Unaudited Condensed Consolidated Financial Statements.

RAVE RESTAURANT GROUP, INC.

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

(In thousands)

(Unaudited)

	Common Stock				Additional Paid-in					Treasury Stock
	Shares		Amount		Capital			Retained Earnings		Shares			Amount			Total
Balance, June 25, 2023		25,090	$	251	$	37,729		$	2,439		(10,936	)	$	(30,028	)	$	10,391
Stock-based compensation expense		—		—		79			—		—			—			79
Net income		—		—		—			386		—			—			386
Balance, September 24, 2023		25,090	$	251	$	37,808		$	2,825		(10,936	)	$	(30,028	)	$	10,856
Stock-based compensation expense		—		—		3			—		—			—			3
RSU vested and taxes paid on RSUs		432		4		(315	)		—		—			—			(311	)
Net income		—		—		—			553		—			—			553
Balance, December 24, 2023		25,522	$	255	$	37,496		$	3,378		(10,936	)	$	(30,028	)	$	11,101

	Common Stock				Additional Paid-in					Treasury Stock
	Shares		Amount		Capital			Retained Earnings		Shares			Amount			Total
Balance, June 30, 2024		25,522	$	255	$	37,563		$	4,912		(10,936	)	$	(30,028	)	$	12,702
Stock-based compensation expense		—		—		73			—		—			—			73
Net income		—		—		—			526		—			—			526
Balance, September 29, 2024		25,522	$	255	$	37,636		$	5,438		(10,936	)	$	(30,028	)	$	13,301
Stock-based compensation expense		—		—		53			—		—			—			53
RSU vested and taxes paid on RSUs		125		1		(183	)		—		—			—			(182	)
Net income		—		—		—			607		—			—			607
Balance, December 29, 2024		25,647	$	256	$	37,506		$	6,045		(10,936	)	$	(30,028	)	$	13,779

See accompanying Notes to Unaudited Condensed Consolidated Financial Statements.

RAVE RESTAURANT GROUP, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

	Six Months Ended
	December 29, 2024			December 24, 2023
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	1,133		$	939
Adjustments to reconcile net income to cash provided by operating activities:
Amortization of discount on short-term investment		(63	)		—
Impairment of long-lived assets and other lease charges		9			—
Stock-based compensation expense		126			82
Depreciation and amortization		46			70
Amortization of operating right-of-use assets		169			219
Amortization of definite-lived intangible assets		41			42
Non-cash lease expense		43			—
Provision (recovery) for credit losses		(8	)		35
Deferred income tax		264			71
Changes in operating assets and liabilities:
Accounts receivable		304			(69	)
Notes receivable		—			(54	)
Deferred contract charges		15			11
Prepaid expenses and other current assets		(40	)		(254	)
Accounts payable - trade		96			151
Accrued expenses		(417	)		(442	)
Operating lease liabilities		(236	)		(249	)
Deferred revenues		(267	)		(247	)
Cash provided by operating activities		1,215			305

CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of short-term investments		(8,102	)		—
Maturities of short-term investments		7,065			—
Payments received on notes receivable		26			30
Proceeds from sale of assets		7

SEC Form 10-Q filed by Rave Restaurant Group Inc.