Good Times Restaurants Inc. (Nasdaq: GTIM), operator of the Bad
Daddy’s Burger Bar and Good Times Burgers & Frozen Custard
restaurant brands, today reported financial results for the 2024
second fiscal quarter.
Key highlights of the Company’s financial results
include:
- Total Revenues for the quarter increased 1.9% to $35.4 million
compared to the second quarter of fiscal 2023
- Same Store Sales1 for company-owned Bad Daddy’s restaurants
decreased 3.2% for the quarter compared to the second quarter of
fiscal 2023
- Same Store Sales for company-owned Good Times restaurants
increased 0.9% for the quarter compared to the second quarter of
fiscal 2023
- Net Income Attributable to Common Shareholders was $0.6 million
for the quarter
- The Company ended the quarter with $4.0 million in cash and
$1.3 million of long-term debt
- The Company repurchased 252,496 shares of its common stock
during the quarter
Ryan M. Zink, the Company’s Chief Executive Officer, said, “Our
Good Times brand continued to produce impressive same store sales
this quarter considering the unfavorable weather in the Colorado
market, and we are excited about the trends we are experiencing so
far in the third fiscal quarter. During the first week of the third
quarter, we commenced our fourth remodel, including structural
repairs, and during which we expect to be closed for approximately
five weeks. Like our other remodels, this one will include new
signage, an exterior refresh and a mural inspired by Colorado
heritage, created by a local artist. In April we began the pilot
phase of our next-generation point-of-sale system, in test at two
locations. We selected the Toast point-of-sale system after several
months of system evaluations, contract negotiations, configuration
and testing. This is the latest initiative in our strategic plan to
modernize our brand. The intuitive user interface will enhance the
employee experience, which in turn will translate into more
efficient order entry and payment, and ultimately, faster speed of
service. Upon a successful pilot period, we expect to rapidly roll
out this new system throughout the Company-owned restaurants.
Additionally, during the quarter, we featured our fish sandwich, a
perennial spring favorite, which exceeded our prior year sales by
14% and which was accompanied by seasoned tots and Cold Brew
Crunch, our custard flavor of the month. Near the beginning of the
third quarter, we added an additional hour of service time in many
of our restaurants as late-night meals and snacks gain in
popularity. Our experienced Good Times team continues to impress me
as they adapt to dynamically changing customer behavior in the
highly competitive quick service segment of the industry.”
Mr. Zink continued, “I am also thrilled with the improvement in
top-line trends at our Bad Daddy’s brand. In addition to the
sequential quarterly improvement in same store sales, we have
significantly improved our performance compared with the Black Box
casual dining benchmark. After lagging the index for much of the
prior year, Bad Daddy’s is trending similarly to, and in some weeks
exceeding, that benchmark. We believe our improvement is due to our
management team’s improved focus on operations excellence and the
efforts we are making to revitalize our bar execution and beverage
program. During the quarter we launched one-day promos related to
Margarita Day, St. Patrick’s Day, and certain sporting events that
positively affected both guest traffic and bar-centric traffic. In
March, our bar mix, as a percentage of on-premises sales, increased
compared to the prior year, which was the first month we have seen
such growth in more than a year. To celebrate both Cinco De Mayo
and National Burger Month, during May we will offer a Birria Burger
that features a house-made consommé with a powerful flavor profile
that is particularly relevant. As we continue to develop solid
processes for introducing new and reoccurring limited time
products, our operations team remains truly focused on driving a
step change in hospitality as we continue to differentiate our
brand from others in casual dining that have reduced portion sizes,
taken an indifferent attitude toward product quality and
compromised on service.”
“Our vision and strategy for both brands is rooted in a belief
that consistency in restaurant operations and genuine hospitality,
appropriate both to the concept and to the guest’s dining occasion,
are the strongest drivers of reliable same store sales increases. I
believe that our operations leadership at both concepts and all of
our support capability leaders are aligned with this approach,”
Zink concluded.
Additionally, the Company announced that it was in negotiations
to purchase the currently franchised Good Times in the Denver
suburb of Parker, Colorado. The Company anticipates this
transaction to close prior to the end of the third fiscal
quarter.
Conference Call: Management will host a conference call
to discuss its second quarter 2024 financial results on Thursday,
May 2, 2024 at 3:00 p.m. MT/5:00 p.m. ET. Hosting the call will be
Ryan M. Zink, its Chief Executive Officer, and Keri A. August, its
Senior Vice President of Finance and Accounting.
The conference call can be accessed live over the phone by
dialing (800) 715-9871, participant code 3596495. The conference
call will also be webcast live from the Company's corporate website
www.goodtimesburgers.com. An archive of the webcast will be
available at the same location on the corporate website shortly
after the call has concluded.
Good Times Restaurants Inc. (Nasdaq: GTIM)
Good Times Restaurants Inc. owns, operates, and licenses 41 Bad
Daddy’s Burger Bar restaurants through its wholly owned
subsidiaries. Bad Daddy’s Burger Bar is a full-service “small box”
restaurant concept featuring a chef-driven menu of gourmet
signature burgers, chopped salads, appetizers and sandwiches with a
full bar and a focus on a selection of craft beers in a high-energy
atmosphere that appeals to a broad consumer base. Additionally,
through its wholly owned subsidiaries, Good Times Restaurants Inc.
owns, operates and franchises 31 Good Times Burgers & Frozen
Custard restaurants primarily in Colorado. Good Times is a regional
quick-service concept featuring 100% all-natural burgers and
chicken sandwiches, signature wild fries, green chili breakfast
burritos and fresh frozen custard desserts.
Forward Looking Statements
This press release contains forward-looking statements within
the meaning of federal securities laws. The words “intend,” “may,”
“believe,” “will,” “should,” “anticipate,” “expect,” “seek”, “plan”
and similar expressions are intended to identify forward-looking
statements. These statements involve known and unknown risks, which
may cause the Company’s actual results to differ materially from
results expressed or implied by the forward-looking statements.
Such risks and uncertainties include, among other things, the
market price of the Company's stock prevailing from time to time,
the nature of other investment opportunities presented to the
Company, the disruption to our business from pandemics and other
public health emergencies, the impact and duration of staffing
constraints at our restaurants, the impact of supply chain
constraints and the current inflationary environment, the uncertain
nature of current restaurant development plans and the ability to
implement those plans and integrate new restaurants, delays in
developing and opening new restaurants because of weather, local
permitting or other reasons, increased competition, cost increases
or shortages in raw food products, other general economic and
operating conditions, risks associated with the acquisition of
additional restaurants, the adequacy of cash flows and the cost and
availability of capital or credit facility borrowings to provide
liquidity, changes in federal, state, or local laws and regulations
affecting the operation of our restaurants, including minimum wage
and tip credit regulations, and other matters discussed under the
Risk Factors section of Good Times’ Annual Report on Form 10-K for
the fiscal year ended September 26, 2023 filed with the SEC, and
other filings with the SEC.
Category: Financial
Good Times Restaurants
Inc.
Unaudited Supplemental
Information
(In thousands, except per share
amounts)
Quarter Ended (13
weeks)
Year-to-Date (26
weeks)
March 26, 2024
March 28, 2023
March 26, 2024
March 28, 2023
NET REVENUES:
Restaurant sales
$
35,265
$
34,568
$
68,211
$
67,747
Franchise revenues
173
217
359
432
Total net revenues
35,438
34,785
68,570
68,179
RESTAURANT OPERATING COSTS:
Food and packaging costs
10,599
10,655
20,926
21,262
Payroll and other employee benefit
costs
12,266
11,989
23,890
23,537
Restaurant occupancy costs
2,613
2,428
5,118
4,886
Other restaurant operating costs
5,105
4,826
9,833
9,318
Preopening costs
-
30
-
30
Depreciation and amortization
926
911
1,853
1,821
Total restaurant operating costs
31,509
30,839
61,620
60,854
General and administrative costs
2,554
2,297
4,867
4,675
Advertising costs
824
778
1,916
1,672
Impairment of long-lived assets
-
76
-
76
Loss (gain) on restaurant and equipment
asset sale
4
(22
)
(6
)
(22
)
Litigation contingencies
(97
)
-
(97
)
-
INCOME FROM OPERATIONS:
644
817
270
924
OTHER EXPENSE:
Interest expense, net
(42
)
(26
)
(74
)
(38
)
NET INCOME BEFORE INCOME TAXES:
602
791
196
886
Provision for income taxes
78
9,952
1
9,952
NET INCOME:
$
680
$
10,743
$
197
$
10,838
Income attributable to non-controlling
interests
(62
)
(122
)
(135
)
(344
)
NET INCOME ATTRIBUTABLE TO COMMON
SHAREHOLDERS
$
618
$
10,621
$
62
$
10,494
NET INCOME PER SHARE, ATTRIBUTABLE TO
COMMON SHAREHOLDERS:
Basic
$
0.06
$
0.90
$
0.01
$
0.88
Diluted
$
0.06
$
0.89
$
0.01
$
0.88
WEIGHTED AVERAGE COMMON SHARES
OUTSTANDING:
Basic
11,136,207
11,818,651
11,256,893
11,930,140
Diluted
11,230,717
11,884,123
11,352,592
11,985,254
Good Times Restaurants
Inc.
Unaudited Supplemental
Information
(In thousands)
Balance Sheet Data
March 26, 2024
September 26, 2023
Cash and cash equivalents
$
4,000
$
4,182
Current assets
$
7,064
$
6,521
Total assets
$
88,955
$
91,088
Current liabilities
$
15,579
$
14,890
Shareholders’ equity
$
32,135
$
32,994
Supplemental Information for
Company-Owned Restaurants (dollars in thousands):
Bad Daddy’s Burger Bar
Good Times Burgers &
Frozen Custard
Second Quarter (13
weeks)
Year-to-Date (26
weeks)
Second Quarter (13
weeks)
Year-to-Date (26
weeks)
2024
2023
2024
2023
2024
2023
2024
2023
Restaurant sales
$
26,448
$
26,342
$
50,568
$
51,507
$
8,817
$
8,226
$
17,643
$
16,240
Restaurants opened during period
-
-
-
-
-
-
-
-
Restaurants closed during period
-
1
-
1
-
-
-
-
Restaurants open at period end
40
39
40
39
25
23
25
23
Restaurant operating weeks
520
507
1,040
1,027
325
299
650
598
Average weekly sales per restaurant
$
50.9
$
52.0
$
48.6
$
50.2
$
27.1
$
27.5
$
27.1
$
27.2
Reconciliation of
Non-GAAP Measurements to U.S. GAAP Results
Reconciliation of Non-GAAP
Restaurant-Level Operating Profit to Income from Operations
(In thousands, except percentage
data)
Bad Daddy’s Burger Bar
Good Times Burgers &
Frozen Custard
Good Times Restaurants
Inc.
----------------------------
Quarter Ended (13 Weeks ------------------------
March 26, 2024
March 28, 2023
March 26, 2024
March 28, 2023
March 26, 2024
March 28, 2023
Restaurant sales
$
26,448
100.0
%
$
26,342
100.0
%
$
8,817
100.0
%
$
8,226
100.0
%
$
35,265
$
34,568
Restaurant operating costs (exclusive of
depreciation and amortization and preopening, shown separately
below):
Food and packaging costs
8,031
30.4
%
8,052
30.6
%
2,568
29.1
%
2,603
31.6
%
10,599
10,655
Payroll and benefits costs
9,172
34.7
%
9,143
34.7
%
3,094
35.1
%
2,846
34.6
%
12,266
11,989
Restaurant occupancy costs
1,743
6.6
%
1,693
6.4
%
870
9.9
%
735
8.9
%
2,613
2,428
Other restaurant operating costs
3,895
14.7
%
3,811
14.5
%
1,210
13.7
%
1,015
12.3
%
5,105
4,826
Restaurant-level operating profit
$
3,607
13.6
%
$
3,643
13.8
%
$
1,075
12.2
%
$
1,027
12.5
%
$
4,682
$
4,670
Franchise revenues
173
217
Deduct - Other operating:
Depreciation and amortization
926
911
General and administrative
2,554
2,297
Advertising costs
824
778
Litigation contingencies
(97
)
-
Impairment of long-lived assets
-
76
Loss (gain) on restaurant and equipment
asset sales
4
(22
)
Pre-opening costs
-
30
Total other operating
4,211
4,070
Income from operations
$
644
$
817
Reconciliation of
Non-GAAP Measurements to U.S. GAAP Results
Reconciliation of Non-GAAP
Restaurant-Level Operating Profit to Income (Loss) from
Operations
(In thousands, except percentage
data)
Bad Daddy’s Burger Bar
Good Times Burgers &
Frozen Custard
Good Times Restaurants
Inc.
----------------------------
Year-to-Date Period Ended (26
weeks)------------------------
March 26, 2024
March 28, 2023
March 26, 2024
March 28, 2023
March 26, 2024
March 28, 2023
Restaurant sales
$
50,568
100.0
%
$
51,507
100.0
%
$
17,643
100.0
%
$
16,240
100.0
%
$
68,211
$
67,747
Restaurant operating costs (exclusive of
depreciation and amortization, and preopening, shown separately
below:
Food and packaging costs
15,640
30.9
%
16,025
31.1
%
5,286
30.0
%
5,237
32.2
%
20,926
21,262
Payroll and benefits costs
17,813
35.2
%
17,898
34.7
%
6,077
34.4
%
5,639
34.7
%
23,890
23,537
Restaurant occupancy costs
3,461
6.8
%
3,425
6.6
%
1,657
9.4
%
1,461
9.0
%
5,118
4,886
Other restaurant operating costs
7,476
14.8
%
7,333
14.2
%
2,357
13.4
%
1,985
12.2
%
9,833
9,318
Restaurant-level operating profit
$
6,178
12.2
%
$
6,826
13.3
%
$
2,266
12.8
%
$
1,918
11.8
%
$
8,444
$
8,744
Franchise revenues
359
432
Deduct - Other operating:
Depreciation and amortization
1,853
1,821
General and administrative
4,867
4,675
Advertising costs
1,916
1,672
Litigation contingencies
(97
)
-
Impairment of long-lived assets
-
76
Gain on restaurant and equipment asset
sales
(6
)
(22
)
Pre-opening costs
-
30
Total other operating
8,533
8,252
Income from operations
$
270
$
924
Certain percentage amounts in the table above
may not total due to rounding as well as the fact that restaurant
operating costs are expressed as a percentage of restaurant
revenues (as opposed to total revenues).
The Company believes that restaurant-level operating profit is
an important measure for management and investors because it is
widely regarded in the restaurant industry as a useful metric by
which to evaluate restaurant-level operating efficiency and
performance. The Company defines restaurant-level operating profit
to be restaurant revenues minus restaurant-level operating costs,
excluding restaurant closures and impairment costs. The measure
includes restaurant-level occupancy costs, which include fixed
rents, percentage rents, common area maintenance charges, real
estate and personal property taxes, general liability insurance and
other property costs, but excludes depreciation. The measure
excludes depreciation and amortization expense, substantially all
of which is related to restaurant level assets, because such
expenses represent historical sunk costs which do not reflect
current cash outlay for the restaurants. The measure also excludes
selling, general and administrative costs, and therefore excludes
occupancy costs associated with selling, general and administrative
functions, and pre-opening costs. The Company excludes restaurant
closure costs as they do not represent a component of the
efficiency of continuing operations. Restaurant impairment costs
are excluded, because, like depreciation and amortization, they
represent a non-cash charge for the Company’s investment in its
restaurants and not a component of the efficiency of restaurant
operations. Restaurant-level operating profit is not a measurement
determined in accordance with generally accepted accounting
principles (“GAAP”) and should not be considered in isolation, or
as an alternative, to income from operations or net income as
indicators of financial performance. Restaurant-level operating
profit as presented may not be comparable to other similarly titled
measures of other companies. The tables above set forth certain
unaudited information for the current and prior year fiscal
quarters and year-to-date periods for fiscal 2024 and fiscal 2023,
expressed as a percentage of total revenues, except for the
components of restaurant operating costs, which are expressed as a
percentage of restaurant revenues.
Reconciliation of Net Loss to Non-GAAP
Adjusted EBITDA (Thousands of US Dollars)
Quarter Ended (13
weeks)
Year-to-Date (26
weeks)
March 26, 2024
March 28, 2023
March 26, 2024
March 28, 2023
Adjusted EBITDA2:
Net Income, as reported
$
618
$
10,621
$
62
$
10,494
Depreciation and amortization
929
900
1,858
1,767
Interest expense, net
42
25
74
38
Provision for income taxes
(78
)
(9,952
)
(1
)
(9,952
)
EBITDA
1,511
1,594
1,993
2,347
Preopening expense
-
30
-
30
Non-cash stock-based compensation
40
43
78
89
Asset Impairment
-
76
-
76
GAAP rent-cash rent difference
(163
)
(190
)
(326
)
(314
)
Loss (gain) on restaurant and equipment
asset sales
4
(22
)
(6
)
(22
)
Litigation contingencies
(97
)
-
(97
)
-
Adjusted EBITDA
$
1,295
$
1,531
$
1,642
$
2,206
Adjusted EBITDA is a supplemental measure of operating
performance that does not represent and should not be considered as
an alternative to net income or cash flow from operations, as
determined by GAAP, and our calculation thereof may not be
comparable to that reported by other companies. This measure is
presented because we believe that investors' understanding of our
performance is enhanced by including this non-GAAP financial
measure as a reasonable basis for evaluating our ongoing results of
operations.
Adjusted EBITDA is calculated as net income before interest
expense, provision for income taxes and depreciation and
amortization and further adjustments to reflect the additions and
eliminations presented in the table above.
Adjusted EBITDA is presented because: (i) we believe it is a
useful measure for investors to assess the operating performance of
our business without the effect of non-cash charges such as
depreciation and amortization expenses and asset disposals, closure
costs and restaurant impairments, and (ii) we use Adjusted EBITDA
internally as a benchmark for certain of our cash incentive plans
and to evaluate our operating performance or compare our
performance to that of our competitors. The use of Adjusted EBITDA
as a performance measure permits a comparative assessment of our
operating performance relative to our performance based on our GAAP
results, while isolating the effects of some items that vary from
period to period without any correlation to core operating
performance or that vary widely among similar companies. Companies
within our industry exhibit significant variations with respect to
capital structures and cost of capital (which affect interest
expense and income tax rates) and differences in book depreciation
of property, plant and equipment (which affect relative
depreciation expense), including significant differences in the
depreciable lives of similar assets among various companies. Our
management believes that Adjusted EBITDA facilitates
company-to-company comparisons within our industry by eliminating
some of these foregoing variations. Adjusted EBITDA, as presented,
may not be comparable to other similarly titled measures of other
companies, and our presentation of Adjusted EBITDA should not be
construed as an inference that our future results will be
unaffected by excluded or unusual items.
_____________________
1 Same store sales are a metric used in evaluating the
performance of established restaurants and is a commonly used
metric in the restaurant industry. Same store sales for our brands
are calculated using all units open for at least 18 full fiscal
months and use the comparable operating weeks from the prior year
to the current year quarter’s operating weeks.
2 Depreciation and amortization, the difference between GAAP
rent and cash rent and the loss (gain) on restaurant and equipment
asset sales have been reduced by any amounts attributable to
non-controlling interests.
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version on businesswire.com: https://www.businesswire.com/news/home/20240502958945/en/
GOOD TIMES RESTAURANTS INC. CONTACTS: Ryan M. Zink, Chief
Executive Officer (303) 384-1432 Christi Pennington (303)
384-1440
Good Times Restaurants (NASDAQ:GTIM)
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