BAB, Inc. reported its financial results for the second quarter and first half of fiscal 2025, revealing a decline in total revenues and a modest increase in net income compared to the same periods in the previous year. For the three months ended May 31, 2025, the company generated total revenues of $808,486, a decrease of 8.5% from $882,838 in the same quarter of 2024. However, net income rose to $154,292, up from $145,685 year-over-year. For the six-month period, total revenues were $1,565,687, down 8.9% from $1,718,772, while net income increased to $270,559 from $244,190.
The decline in revenue was primarily attributed to a significant drop in marketing fund revenue, which fell by 26.1% to $227,049 in the second quarter, reflecting a corresponding decrease in marketing fund expenses. Royalty fees from franchised stores remained relatively stable, with a slight decrease of 0.2% to $511,879 for the quarter. Franchise fee revenue saw a more pronounced decline, dropping 55.6% to $3,583, as there were no transfers of franchise agreements during the quarter, compared to one transfer in the same period last year.
Operationally, BAB, Inc. maintained a total of 61 franchise units and 4 licensed units as of May 31, 2025, down from 64 franchise units a year earlier. The company continues to focus on leveraging synergies between its brands, including Big Apple Bagels and My Favorite Muffin, to enhance product offerings and operational efficiencies. The company employed 12 individuals at its corporate office, a slight increase from the previous year, and reported a working capital of $1,733,000, up from $1,618,000 in the prior year.
Looking ahead, BAB, Inc. plans to increase marketing expenditures in the latter half of fiscal 2025 to support brand awareness and franchisee growth. The company has also declared a quarterly cash distribution of $0.01 per share, reflecting its commitment to returning value to shareholders. Management remains cautious about market conditions and is focused on controlling costs while exploring opportunities for growth through franchise development and product innovation. The company’s outlook remains positive, with expectations for improved performance as marketing initiatives take effect and franchise operations stabilize.
About BAB, INC.
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