Retail Food Group (RFG), owner of franchised brands such as Brumby’s, Donut King, Crust Gourmet Pizza, Michel’s Patisserie and Gloria Jean’s, has been suspended from the ASX after it failed to lodge its first-half results on time.
Yesterday, shares in the business went into a trading halt after saying its results could only be finalised when the auditor’s report, due tomorrow, was completed.
RFG issued another profit downgrade in January, cutting $11.5 million off its previous half-year forecast to around $22 million.
The business blamed “persistent challenging domestic retail conditions” and negative media coverage about franchising for the reduced performance.
A Fairfax Media investigation alleged franchisees were being mistreated as “a result of a brutal business model”.
The company’s shares last traded at $2.04, well below its 12-month high of $5.73.
Lawyers are reportedly investigating a class action against the company on behalf of the franchisees, alleging the business failed to disclose a range of financial performance-related matters involving the stores.