Now, if you’ve been following us, we’ve been tracking Giggles N Hugs Inc (OTCMKTS:GIGL), and in our last article, we noted some key reasons why Giggles N Hugs Inc could rise. With the company’s earnings report, we’re able to delve into some of the numbers to see whether Giggles N Hugs is growing or not, but more on that later.
Giggles N Hugs is the first and one of the only restaurants that has been bringing high-end, organic food with active, innovative play and entertainment for children. That in mind, each and every Giggles N Hugs location offers an upscale atmosphere for families, and Giggles N Hugs locations have a play area for children 10 and younger. Now, the company has brought in some celebrity brand ambassadors, such as Tia Mowry-Hardict and Jillian Michaels. Consequently, the company may be using this as a marketing ploy to potentially attract more customers into its business.
Moving on, let’s get into the company’s fiscal year 2016 financial results. Giggles N Hugs Inc (OTCMKTS:GIGL) reported net sales dropped by $428K for the fiscal year ended on January 1, 2017. However, this was attributed to major remodeling of the Century City Westfield Mall, which caused the closing of one of its locations, and consequently, over $550K of the fall in sales was related to the closing of that location.
The company’s Glendale location was able to increase its same store sales by 35%, when compared to the prior fiscal year. Moreover, it had 23% cash flow at the unit level, and the Glendale location’s sales rose by 5.7% to $1.3M. Additionally, its Topanga location increased same store sales by 23%, with 2.9% cash flow at the unit level. The company’s Topanga location sales were increased by 5.3%, to $1.3M.
Joey Parsi, founder and CEO of Giggles N’ Hugs, stated, “We are excited of our operational successes for 2016 and there is a lot to be proud of. As we work hard to get the company ready for additional future growth, we understand that this is just the beginning and that there is much more work for us to do.”
Parsi continued, “Our year-over-year results reflect the selling of our lease of our Century City location back to Westfield at the end of June of 2016. Given that Westfield had embarked on a multi-year, $1 billion renovation and redevelopment of the mall, they offered to buy back our lease, an offer we accepted since we only had a limited time remaining on our lease. This sale muted the overall impact of our other stores in Topanga and Glendale, which generated annual sales increases of 5.3% and 5.7%, while quarterly revenue was up an astounding 35% and 23%, respectively.”
Now, the company operated at a loss during the 2016 fiscal year, but this is quite common with growth stage companies. However, the closure of one of its location makes it quite difficult to determine how the company actually performed.
Parsi added, “The impressive same-store sales growth we saw in Topanga and Glendale, further validates our award-winning concept. And with our loss from operations declining 54% year-over-year, we believe we’ve further proven our ability to execute. We are working hard to continue this momentum.”
With the company hiring two new brand ambassadors, it could continue its growth. GIGL fiscal year 2016 report still showed some signs of growth, if you exclude the closure of one of its stores. Now, if you missed its earnings report, you might not want to miss any of its future developments. It’s actually quite easy to stay on top of GIGL. All you have to do is enter your email address below, and we can provide you with updates, if any, on the stock.
Disclosure: No one at Street Register has been compensated in any way for the publishing of this article, nor do we hold any position in GIGL stock, short or long.