Noble Roman'S Inc

Well, good afternoon, everyone. My name is Scott Mobley, and I'm President and CEO of Noble Romans. Also here with me is Paul Mobley, our Executive Chairman and CFO. Before we begin, I want to refer you to the Safe Harbor Statement contained in the summary press release that came out Friday. This conference call will contain forward-looking statements and business assessments of the kind referred to in that statement, so those provisions apply to this conference call as well. Okay, well I assume all of you have studied the press release that went out Friday afternoon, and that you've absorbed all of those details. Keep in mind that we're holding on, releasing the 10Q for the new auditors to finish, with the delay at the moment being the evaluation of that warrant liability. That's sort of a black box calculation that has to do with warrant and derivative valuation modeling, and so that's with the valuation firm specializing in those complex formulas. but we'll get the queue out just as soon as we can. In case you did miss the release or you need a refresher, here are a few of the highlights. Net income before taxes was $578,918 for the quarter versus $193,314 in 2024. And keep in mind that income before tax is an important metric because we have that 3.2 million deferred tax asset, which means, of course, that we'll not be paying income tax for quite some time. Total revenue is up 6.8% for the quarter versus last year. Same store sales in the Kraft Pizza and Pub were up 4.2%. That's despite continuing concerns with consumer sentiment. Margins at the CPPs also increased 12.8% from 7.9 a year ago. The margin contribution for our convenience store program was up 14.8% over 2024 to about 1.1 million. And the margin rate for that segment increased to 73.4% from 65.2% chiefly because expenses in that segment remain relatively stable over a long period of time. A key data trend outlined in the press release is also worth repeating this time around today, and that relates to the trailing 12-month adjusted EBITDA. At the year end, 2024, it was a little over 3 million. At the end of Q1, 2025, it was 3,135,000. At the end of Q2, it was 3,501,000. And now at the end of Q3, it is up to approximately 3,825,000. Our convenience store program continues to build on our backlog of franchises sold but not yet open. Our current expectations call for about 27 additional new units during the entirety of the fourth quarter. Of course, that's always hard to predict with exactness as those timelines depend on a number of factors with the underlying convenience store business rather than with us. The psychology around some of the tariff negotiations, particularly with India, as well as the government shutdown had an impact on openings for a while, but things are moving along very well at the moment. In fact, we have three brand new locations opening this week. Muncie, Indiana, Lawrence, Michigan, and Harrogate, Tennessee. Some of the same challenges impacted the craft pizza and pubs, mostly as it relates to consumer spending and consumer sentiment. As I'm sure you heard a few days ago, according to the recent University of Michigan survey, consumer sentiment has dropped to a three-year low, down 29.9% versus last year. We've had to maintain a value-oriented marketing approach most of the year, particularly recently, which is obviously not our preference. For the same reasons, we've not taken a price increase this year, and I don't see doing so in the fourth quarter either. We'll see what the manufacturers have in store at the beginning of the year as far as price escalations, and we'll evaluate consumer sentiment at that time as well. For now, as was mentioned in the press release, we have two products waiting for introduction. One is another value-oriented play off our successful XL pizza launch, and the other is a premium-priced product, a spicy buffalo chicken pizza. I see both running simultaneously at some point here soon, with the 2XL party pizza being our primary value promotion, and the buffalo chicken pizza being passively marketed in-store and online to goose up margins. Finally, as we noted in the release, the refinancing efforts are proceeding with some accelerating and hopeful developments, but not yet anything we can announce or discuss. Conversations and negotiations are ongoing. I know everyone would like to hear more on that, but that is really all we can say at the moment until such time as we have something definitive to announce. Okay, well with that brief review, we're including our introductory comments and we'll now take your questions. If you wanna ask a question and you logged in with your full name when you joined the call, press five and the star key on your phone. That'll cue you in line. Again, that is five star. When it is your turn to ask a question, you'll hear a voice saying your line has been unmuted. And hearing that your line has been unmuted is your go ahead to ask a question. So again, press five star if you have a question. And we'll get to those questions. Hi, Roger.

Go ahead. Good afternoon. Very nice quarter. You can't really talk about the refinancing, but can you tell us how much is still owed to Corbell?

Approximately $6,000. Six million.