Freshii Inc. (FRII.TO) shares plunged Wednesday morning after the healthy fast-food chain posted another quarter of weak sales, adding to a string of disappointing results that has shattered investor confidence.
Same-store sales at Freshii fell four per cent in the quarter that ended June 30. Meanwhile, system-wide sales totalled US$49.6 million, up from US$46.3 million a year ago, boosted by an increase in the number of stores. And it posted a modest profit of US$433,000, or one cent per share, compared with earnings of $298,000 a year ago.
It wasn’t always a struggle for the company that’s best known for its salads, rice-and-tofu bowls, and smoothies. Freshii hit Bay Street with big growth ambitions when it went public in January 2017. After listing at $11.50, shares peaked at $14.90 on March 1, 2017. Since then, the stock has lost more than 80 per cent of its value.
“I’m sick of salads – I’m not the only one,” Barry Schwartz, chief investment officer and portfolio manager at Baskin Wealth Management, told BNN Bloomberg’s Paige Ellis Wednesday.
“They need to bring fresh management with new ideas, maybe start some type of loyalty program,” Schwartz said. “Food is extremely competitive: something goes hot and fashionable then it comes out.”
The restaurant chain announced Tuesday it was beefing up its management and governance teams, as former Yum! Brands executive Oliver Rodbard was appointed as Freshii’s vice president of operations, and former Coca-Cola official Bill Schultz was added to the company’s board of directors.
With files from The Canadian Press