Rocky Mountain Chocolate Factory Inc. announced Tuesday that its wholly owned subsidiary, U-Swirl Inc., recently purchased two self-service frozen-yogurt chains.
U-Swirl acquired CherryBerry Enterprises LLC and Yogli Mogli LLC. The purchases closed Friday, the company disclosed in its quarterly investor release Tuesday.
The purchases totaling $7.75 million were financed largely by a $7 million Wells Fargo loan, the company said.
“We believe U-Swirl is well-positioned to become a leading consolidator in the self-serve frozen yogurt segment of the $6 billion away-from-home frozen desserts industry,” Bryan Merryman, Rocky Mountain Chocolate Factory’s chief operating officer and chief financial officer, wrote in a news release.
Rocky Mountain Chocolate Factory reported a 7.5 percent revenue increase to $9.3 million in the quarter that ended Nov. 30. That was up from $8.6 million a year earlier.
Same-store sales at domestic Rocky Mountain Chocolate Factory franchises were unchanged, the company said.
The company saw a 4.9 percent drop in same-store pounds of factory product purchased by stores. The company attributed the decline to the shorter post-Thanksgiving shopping period in 2013.
The company’s stock jumped 3 percent on the news, closing at $12.01 per share Tuesday. Rocky Mountain Chocolate Factory is traded on the Nasdaq exchange under the symbol RMCF.
The company also saw success with licensing its name to a breakfast cereal made by Kellogg.
“On the licensing front, sales of Kellogg’s Limited Edition Rocky Mountain Chocolate Factory Chocolatey Almond Cereal exceeded our expectations during the test-marketing phase, and we were recently pleased to learn that Kellogg is rolling out the specialty cereal to a majority of its retail distribution channels,” Merryman wrote.
“We have always believed that the strength of our national brand represents an asset that can be leveraged through licensing agreements into other product categories, and we are hopeful that our success in the cereal industry will lead to additional licensing opportunities going forward,” he wrote.
cslothower@durangoherald.com
