Micro Cap Company Spicy Pickle (SPKL) Shows Same-Store Growth
Being a fast-growing franchise, it can be tough to evaluate bulletin board company Spicy Pickle (SPKL). The challenge is distinguishing between expansion-based growth and the improvement of your existing revenue centers. To help investors figure it all out, sometimes a retailer or restaurant will publicize ’same store‘ sales. As a shareholder, even if the company never opened another unit, you’d still want to see evidence that growth was going to happen.
Just a few moments ago, Spicy Pickle announced their Q1 (2008) same-store revenue growth was just a hair under 5%. The sixteen stores they had up and running during Q1 of 2007 generated an average of 5% more sales in Q1 of 2008. Therefore, the corporation’s royalties were increased by the same percentage (they take their cut from the top line).
So what? The most important thing it demonstrates to us is simply proof of the concept. Growth is tough to come by in any environment, but it’s particularly impressive considering consumers went into hibernation mode during the first quarter of this year. If there was any doubt that the restaurants’ ‘fast and casual’ concept would fly, the revenue increase should alleviate the concern.
In short, the restaurant’s concept has been proven in the real world. Here’s the news release.
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