If You Invested in Noble Romans (NROM)

Noble Roman’s, Inc. (OTCQB:NROM) is an Indianapolis-based company in the food service contractors industry within the accommodation and food services sector. According to company disclosures and press releases, Noble Roman’s operates as a franchisor, licensor and operator of the Noble Roman’s Pizza brand and the Noble Roman’s Craft Pizza & Pub concept. The company’s activities include company-owned restaurant operations as well as franchised and licensed locations in a variety of venues.

Business model and segments

Based on its public financial statements and news releases, Noble Roman’s generates revenue from several primary sources. These include restaurant revenue from company-owned Craft Pizza & Pub locations, restaurant revenue from company-owned non-traditional locations, and franchising revenue. The company also reports administrative fees and other income. Management commentary and segment data highlight two key operating areas: the company-owned Craft Pizza & Pub segment and a non-traditional franchising segment that includes a convenience store pizza program and locations in travel plazas and similar venues.

The company’s non-traditional franchising activities are described as expanding rapidly, particularly in convenience stores and travel plazas. Noble Roman’s has reported opening dozens of new non-traditional franchise locations in a single year and building a backlog of sold but unopened units that it expects to open over subsequent periods. The company has also disclosed development activity with multi-unit franchise partners.

Noble Roman’s Craft Pizza & Pub

Noble Roman’s describes its Craft Pizza & Pub (CPP) concept as a key contributor to its overall results. CPP locations are company-owned and operate as full-service pizza restaurants. In public communications, the company notes that CPP restaurants have provided a meaningful contribution to profit and that same-store sales trends at these locations are an important performance indicator. The company has reported periods of same-store sales growth at CPP locations, including positive comparisons in certain quarters and specific months.

Marketing efforts for the Craft Pizza & Pub concept include limited-time pizza promotions. For example, Noble Roman’s has introduced an “Xtra-Stuffed Crust” pizza as a promotional item in its Craft Pizza & Pub segment, emphasizing a hand-rolled, cheese-stuffed crust and a focus on cheese quality and preparation. The company has also referenced additional promotional pizzas, such as a Spicy Buffalo Chicken Pizza and a 2XL Party Pizza, as part of its product development pipeline for the CPP segment.

Non-traditional franchising and convenience store pizza program

In addition to company-owned restaurants, Noble Roman’s operates a non-traditional franchise segment. Public disclosures describe this segment as focused primarily on locations in convenience stores and travel plazas. The company has reported that this segment experienced significant unit growth, with dozens of new non-traditional franchise locations opened in a year and expectations for further openings in subsequent periods.

Within this non-traditional segment, Noble Roman’s highlights a convenience store pizza program. Financial summaries in company news releases refer to contribution margin and margin contribution rate for this program, noting that expenses in the segment tend to remain relatively stable over significant increments in revenue. As revenue in this segment increases, the company reports that the margin rate has tended to rise, reflecting the fixed or semi-fixed nature of certain costs.

Franchising revenue and licensing

The company’s franchising revenue is a major component of total revenue. Noble Roman’s has disclosed that franchising revenue increased meaningfully year over year, and that adjustments in revenue recognition methods affected reported results in a particular year. The company has also described itself as a franchisor and licensor of Noble Roman’s Pizza and Noble Roman’s Craft Pizza & Pub, indicating that it enters into agreements that allow third parties to operate under its brands.

In its public communications, Noble Roman’s has discussed development agreements with multi-unit partners and the sale of additional franchised units that have not yet opened, which it expects to contribute to future franchising revenue as those units begin operations. The company has also reported that non-traditional franchising revenue growth has been a focus and that it anticipates continued expansion in that area based on its pipeline of prospects and backlog of signed agreements.

Financial reporting and capital structure

Noble Roman’s files periodic reports with the U.S. Securities and Exchange Commission, including annual reports on Form 10-K, quarterly reports on Form 10-Q, and current reports on Form 8-K. The company has also filed a Form 12b-25 (NT 10-Q) to notify of a delayed quarterly filing, citing the engagement of a new independent registered public accounting firm and the need for additional time to complete review procedures.

The company’s consolidated financial statements present details on assets, liabilities, stockholders’ equity, revenue, expenses and segment performance. Disclosures include items such as a deferred tax asset, deferred contract costs, operating lease right-of-use assets, and goodwill. On the liabilities side, the company reports a senior term loan payable to Corbel Capital Partners, convertible notes payable, operating lease liabilities, and warrant liabilities, among others.

Noble Roman’s has publicly discussed extensions and amendments to its senior lending facility with Corbel Capital Partners. In one extension, the company disclosed that the maturity of the loan was pushed to a later date and that the interest terms were modified, including a change to an interest rate expressed as SOFR plus a stated percentage and the removal of payment-in-kind interest. The company has also described ongoing efforts to obtain new financing that would allow repayment of the senior loan, subordinated notes and related obligations, and has referenced Corbel’s willingness to have its warrants repurchased in connection with such a refinancing.

Corporate governance and auditors

Noble Roman’s is incorporated in the state of Indiana and has common stock registered under a Commission file number referenced in its SEC filings. The company has reported changes in its board of directors through Form 8-K filings, including the resignation of a director and the appointment of a new Class I director to fill a vacancy. The company’s proxy materials and related disclosures describe compensation arrangements for non-employee directors.

The company has also announced changes in its independent registered public accounting firm. In a press release and corresponding SEC disclosure, Noble Roman’s reported engaging Stephano Slack LLC as its new independent auditor for a specified fiscal year and related quarterly reviews. The company has noted that prior auditors issued unqualified or unmodified opinions on earlier consolidated financial statements. The engagement of a new PCAOB-registered firm was also cited as a reason for additional time needed to complete review procedures for a quarterly report.

Brand and operating footprint

Public communications describe Noble Roman’s as an Indianapolis-based company and refer to it as Indiana’s home-grown local favorite in connection with the Noble Roman’s Craft Pizza & Pub concept. The company has identified multiple Craft Pizza & Pub locations in the Indianapolis metropolitan area. These locations feature made-from-scratch dough prepared in glass-enclosed, climate-controlled dough rooms, a salad bar, beverage offerings such as local craft beers and wines at a bar area referred to as the “Piazza Bar,” and a family-oriented dining environment with large screen televisions.

In addition to its presence in the Indianapolis metro area, Noble Roman’s has highlighted its non-traditional franchise locations in convenience stores and travel plazas, though specific geographic coverage beyond those descriptions is not detailed in the referenced materials. The company’s strategy, as described in its news releases, emphasizes expanding non-traditional franchising while maintaining and optimizing company-owned Craft Pizza & Pub operations.

Stock information

Noble Roman’s common stock trades on the OTCQB market under the ticker symbol NROM. The company has disclosed the number of authorized and outstanding shares of common stock in its consolidated balance sheets and has referenced warrants to purchase additional shares in connection with its financing arrangements. Shareholder matters, including annual meetings and quorum requirements, are addressed in SEC filings such as Form 8-K, where the company has reported on the status of its annual meeting of shareholders and the presence or absence of a quorum.

Risk factors and forward-looking statements

In its public filings and press releases, Noble Roman’s includes cautionary language regarding forward-looking statements. These statements relate to expectations about future revenues, profitability, financing, market demand, product development, franchise openings, same-store sales trends and other operational matters. The company notes that actual results may differ materially from these expectations due to various risks and uncertainties, and it directs readers to the “Risk Factors” section of its Annual Report on Form 10-K for a detailed discussion of such risks.

Overall, Noble Roman’s, Inc. presents itself as a franchisor, licensor and operator of pizza-focused restaurant concepts, combining company-owned Craft Pizza & Pub locations with a growing base of non-traditional franchised units, particularly in convenience stores and travel plazas, and supporting these operations through financing arrangements and ongoing corporate governance and reporting activities.