Blog of an aspiring foodie

Complete and total stream of blogging thought

Posted by beer_chris on 19-January-2006

Fist off, Robb Walsh is back, and just when some of us were starting to get worried.

Last night had dinner with the old krewe at Dave's family's house. Old school spaghetti dinner. Yum. During dinner I shared my newfound obsession: cheeseburger pizza. This incarnation was most recently had at Pizza Inn, which opened one of their new 'we wish we were CiCi's' buffets near my office (interestingly, I had no idea Pizza Inn was founded in Dallas and is still headquartered near there until I went looking for some type of press release detailing the cornball design of these new buffet restaurants. I never did find a press release, but I did learn that Pizza Inn has revenues of only $13M. A whopping $1.5M (>10%!) of that went to legal fees for 'ongoing litigation' (see below for likely explanation).

By comparison, a quick financials search shows that:
Papa Johns has revenue of nearly $1B ($978M), with market cap of about $580M
Dominoes: $1.5B sales, $1.6B market cap
Pizza Hut is part of PepsiCo, and I don't feel like trying to dig that up
Mr Gatti's is privately held and recently purchased, sales were reported at the time of the sale to be around $150M

I find that shocking. Pizza Inn is the smallest (in terms of revenue) of the small time pizza chains? Smaller then Gattis even? Papa Johns is two-thirds as large (again, on a revenue basis) as 300 lb gorilla Dominoes, but with less then half the market cap? I know Papa Johns is kind of unique, since they are both in the store ownership and ingredient selling game (whereas Dominoes and Pizza Inn, for example, simply sell ingredients and collect franchise fees), but I still find that kind of surprising. Is the pizza market so competitive in Texas that a normal consumer couldn't figure this kind of stuff out logically? I suppose not . . .

On the lawsuit topic, here's an interesting little story about corporate collusion and poor ethics.

From the same site, I quote the following from an article titled “Winners and Losers in 2004”. I'm guessing that's why the legal fees are being reserved so high:
[SNIP]
An ongoing board of directors scandal has all but halted any growth or progress at the 410-unit chain. In June the chain's legal counsel and senior vice president, Keith Clark, stepped down, followed by the ouster of Pizza Inn's CEO and President, Ronnie Parker, in November. Both men were part of a group of four executives who, with board approval, rewrote their labor agreements in 2002 to include huge parachute payouts that could devastate the company. Proof that Parker viewed himself as the largest hog at the trough: His annual compensation package consumed nearly 50 percent of Pizza Inn's profits in 2004.

Clark is now in arbitration with Pizza Inn, and Parker is threatening to sue the chain.
[/SNIP]

Ummm, Pizza Inn was deemed a 'loser' in 2004.

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