Carrols Restaurant Group, Inc. (“Carrols” or the “Company”)
(Nasdaq: TAST), the largest BURGER KING® franchisee in the United
States, today reported its financial results for the fourth quarter
and full year ended January 1, 2023.
Highlights for the Fourth Quarter
of 2022 versus the Fourth Quarter
of 2021 include:
- Total restaurant sales increased
7.0% to $445.1 million in the fourth quarter of 2022 compared to
$416.1 million in the fourth quarter of 2021;
- Comparable restaurant sales for the
Company's Burger King® restaurants increased 6.2%;
- Comparable restaurant sales for the
Company’s Popeyes® restaurants increased 9.2%;
- Adjusted EBITDA(1) totaled $25.4
million compared to $13.9 million in the prior year quarter;
- Adjusted Restaurant-Level EBITDA(1)
totaled $46.9 million compared to $34.2 million in the prior year
quarter;
- Net Loss was $19.1 million, or
$0.38 per diluted share, compared to Net Loss of $16.4 million, or
$0.33 per diluted share, in the prior year quarter;
- Adjusted Net Loss(1) was $2.5
million, or $0.05 per diluted share, compared to Adjusted Net Loss
of $7.5 million, or $0.15 per diluted share, in the prior year
quarter; and
- Free Cash Flow(2) of $14.5 million
compared to $8.8 million in the prior year quarter.
Highlights for the Full Year
2022 versus the Full Year
2021 include:
- Total restaurant sales increased
4.7% to $1,730.4 million in the full year of 2022 compared to
$1,652.4 million in the full year of 2021;
- Comparable restaurant sales for the
Company's Burger King® restaurants increased 3.9%;
- Comparable restaurant sales for the
Company’s Popeyes® restaurants increased 4.9%;
- Adjusted EBITDA(1) totaled $62.5
million compared to $81.6 million in the prior year;
- Adjusted Restaurant-Level EBITDA(1)
totaled $141.9 million compared to $157.0 million in the prior
year;
- Net Loss was $75.6 million, or
$1.49 per diluted share, compared to Net Loss of $43.0 million, or
$0.86 per diluted share, in the prior year;
- Adjusted Net Loss(1) was $35.7
million or $0.70 per diluted share, compared to Adjusted Net Loss
of $21.3 million, or $0.43 per diluted share, in the prior year;
and
- Free Cash Flow(2) of a use of $16.4
million in the full year of 2022 compared to $22.9 million
generated in the prior year.
(1)Adjusted EBITDA, Adjusted Restaurant-Level
EBITDA and Adjusted Net Income (Loss) are non-GAAP financial
measures. Refer to the definitions and reconciliation of these
measures to net income (loss) or to income (loss) from operations
in the tables at the end of this release.
(2)Free Cash flow is a non-GAAP financial
measure. Refer to the definition and reconciliation of this measure
in the tables at the end of this release.
Management Commentary
Anthony E. Hull, Interim President and Chief
Executive Officer of Carrols, commented, “We are pleased with our
strong top-line momentum during the fourth quarter, with comparable
sales growth of 6.2% at our Burger King restaurants and 9.2% at our
Popeyes restaurants. The initiatives we began implementing in 2022
to strengthen our restaurant operations contributed to both
sequential and year-over-year restaurant margin expansion. We also
achieved continued improvement in our guest experience, as
demonstrated by gains in our customer satisfaction scores of
approximately 25% at our Burger King restaurants.”
Hull concluded, “As we look into 2023, we are
excited by the trends we are seeing, both on the top-line and with
input costs, and believe we are on track to deliver continued
gradual margin improvement over time. We are also encouraged by
Burger King's "Reclaim the Flame" plan to increase sales and drive
franchisee profitability. Our balance sheet continues to provide us
with significant liquidity, a long runway with respect to debt
maturities, and stable and manageable debt service obligations.
Overall, we believe that the operational improvements we continue
to make, combined with the potential positive impacts from Burger
King's multi-faceted plan to strengthen the brand, put us in a
strong position heading into 2023.”
Fourth Quarter
2022 Financial Results
Total restaurant sales were $445.1 million in
the fourth quarter of 2022, compared to $416.1 million in the
fourth quarter of 2021, both of which were a 13-week period.
Comparable restaurant sales for the Company’s
Burger King restaurants increased 6.2% compared to a 7.4% increase
in the prior year quarter.
Restaurant sales for the Company’s Popeyes
restaurants, which represented 4.9% of total restaurant sales in
the fourth quarter of 2022, increased on a comparable restaurant
sales basis by 9.2% compared to 1.0% in the fourth quarter of
2021.
Adjusted Restaurant-Level EBITDA(1) was $46.9
million in the fourth quarter of 2022 compared to $34.2 million in
the prior year period. Adjusted Restaurant-Level EBITDA margin
improved to 10.5% of restaurant sales from 8.2% in the fourth
quarter of 2022, reflecting improved margins on food, beverage and
packaging costs given moderation in commodity cost inflation as
well as leverage on wage and related expenses from higher average
checks.
General and administrative expenses increased to
$22.7 million in the fourth quarter of 2022 from $22.4 million in
the prior year period including stock compensation expense of $1.1
million and $1.7 million, respectively.
Adjusted EBITDA(1) was $25.4 million in the
fourth quarter of 2022 compared to $13.9 million in the fourth
quarter of 2021. Adjusted EBITDA margin increased to 5.7% of total
restaurant sales from 3.3% due to the factors discussed above.
Income from operations was $2.8 million in
the fourth quarter of 2022 compared to loss from operations of
$10.0 million in the prior year quarter.
Interest expense increased to $7.9 million
in the fourth quarter of 2022 from $7.4 million in the fourth
quarter of 2021.
Net Loss was $19.1 million in the fourth
quarter of 2022, or $0.38 per diluted share, compared to a Net Loss
of $16.4 million, or $0.33 per diluted share, in the prior
year quarter. Net Loss in the fourth quarter of 2022 included,
among other items, $2.0 million of impairment and other lease
charges and a $14.9 million increase in the valuation
allowance for deferred taxes. Net Loss in the fourth quarter of
2021 included, among other items, a $1.1 million gain related
to the sale of certain litigation claims.
Adjusted Net Loss(1) was $2.5 million, or
$0.05 per diluted share in the fourth quarter of 2022, compared to
an Adjusted Net Loss of $7.5 million, or $0.15 per diluted
share, in the prior year quarter.
Balance Sheet Update
The Company ended the fourth quarter of 2022
with cash and cash equivalents of $18.4 million, and long-term
debt (including current portion) and finance lease liabilities of
$493.0 million. There were $12.5 million in revolving
credit borrowings outstanding and $9.6 million of letters of
credit issued under the Company’s $215.0 million revolving
credit facility, leaving $192.9 million of availability as of
January 1, 2023. Including the cash balance, the Company had
$211.3 million of available liquidity at the end of the fourth
quarter of 2022.
Conference Call Today
Anthony E. Hull, Interim President and Chief
Executive Officer, and Gretta Miles, Controller and Assistant
Treasurer, will host a conference call to discuss fourth quarter
and full year 2022 financial results at 8:30 a.m. (ET) today.
The conference call can be accessed live over
the telephone by dialing 201-493-6779. A replay will be available
three hours after the call and can be accessed by dialing
412-317-6671; the passcode is 13735441. The replay will be
available until Tuesday, March 7, 2023. Investors and interested
parties may listen to a webcast of the conference call by visiting
the Investor Relations page of the Company’s website located at
www.carrols.com. The press release and related presentation slides
will be accessible via the same website page prior to the scheduled
call.
About the Company
Carrols is one of the largest restaurant
franchisees in North America. It is the largest BURGER KING®
franchisee in the United States, currently operating 1,022 BURGER
KING® restaurants in 23 states as well as 65 POPEYES® restaurants
in seven states. Carrols has operated BURGER KING® restaurants
since 1976 and POPEYES® restaurants since 2019. For more
information, please visit the Company's website at
www.carrols.com.
Forward-Looking Statements
Except for the historical information contained
in this news release, the matters addressed are forward-looking
statements. Forward-looking statements, written, oral or otherwise
made, represent Carrols' expectation or belief concerning future
events. Without limiting the foregoing, these statements are often
identified by the words "may", "might", "believes", "thinks",
"anticipates", "plans", "expects", "intends" or similar
expressions. In addition, expressions of our strategies,
intentions, plans or guidance are also forward-looking statements.
Such statements reflect management's current views with respect to
future events and are subject to risks and uncertainties, both
known and unknown. You are cautioned not to place undue reliance on
these forward-looking statements as there are important factors
that could cause actual results to differ materially from those in
forward-looking statements, many of which are beyond our control.
Investors are referred to the full discussion of risks and
uncertainties as included in Carrols’ filings with the Securities
and Exchange Commission.
Investor Relations:Jeff
Priester332-242-4370investorrelations@carrols.com
Carrols Restaurant Group, Inc. |
Consolidated Statements of Operations |
(In thousands, except per share amounts) |
|
(unaudited) |
|
Three Months Ended (a) |
|
Twelve Months Ended (a) |
|
January 1, 2023 |
|
January 2, 2022 |
|
January 1, 2023 |
|
January 2, 2022 |
Restaurant sales |
$ |
445,058 |
|
|
$ |
416,133 |
|
|
$ |
1,730,440 |
|
|
$ |
1,652,370 |
|
Costs and expenses: |
|
|
|
|
|
|
|
Food, beverage and packaging costs |
|
132,994 |
|
|
|
128,368 |
|
|
|
534,238 |
|
|
|
499,685 |
|
Restaurant wages and related expenses |
|
145,431 |
|
|
|
141,392 |
|
|
|
585,204 |
|
|
|
549,933 |
|
Restaurant rent expense |
|
31,994 |
|
|
|
31,206 |
|
|
|
125,481 |
|
|
|
122,662 |
|
Other restaurant operating expenses |
|
69,881 |
|
|
|
64,494 |
|
|
|
274,557 |
|
|
|
257,774 |
|
Advertising expense |
|
17,943 |
|
|
|
16,506 |
|
|
|
69,389 |
|
|
|
65,433 |
|
General and administrative expenses (b) (c) |
|
22,656 |
|
|
|
22,384 |
|
|
|
88,072 |
|
|
|
83,660 |
|
Depreciation and amortization |
|
19,171 |
|
|
|
19,667 |
|
|
|
78,068 |
|
|
|
80,798 |
|
Impairment and other lease charges |
|
2,009 |
|
|
|
3,189 |
|
|
|
21,877 |
|
|
|
4,470 |
|
Other expense (income), net (d) |
|
183 |
|
|
|
(1,075 |
) |
|
|
(926 |
) |
|
|
(1,186 |
) |
Total costs and expenses |
|
442,262 |
|
|
|
426,131 |
|
|
|
1,775,960 |
|
|
|
1,663,229 |
|
Income (loss) from
operations |
|
2,796 |
|
|
|
(9,998 |
) |
|
|
(45,520 |
) |
|
|
(10,859 |
) |
Interest expense |
|
7,873 |
|
|
|
7,399 |
|
|
|
30,841 |
|
|
|
28,791 |
|
Loss on extinguishment of
debt |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
8,538 |
|
Loss before income taxes |
|
(5,077 |
) |
|
|
(17,397 |
) |
|
|
(76,361 |
) |
|
|
(48,188 |
) |
Provision (benefit) for income
taxes |
|
14,053 |
|
|
|
(997 |
) |
|
|
(789 |
) |
|
|
(5,159 |
) |
Net loss |
$ |
(19,130 |
) |
|
$ |
(16,400 |
) |
|
$ |
(75,572 |
) |
|
$ |
(43,029 |
) |
|
|
|
|
|
|
|
|
Basic and diluted net loss per
share (e)(f) |
$ |
(0.38 |
) |
|
$ |
(0.33 |
) |
|
$ |
(1.49 |
) |
|
$ |
(0.86 |
) |
Basic and Diluted weighted
average common shares outstanding |
|
50,807 |
|
|
|
49,928 |
|
|
|
50,718 |
|
|
|
49,899 |
|
(a) The Company uses a 52 or 53
week fiscal year that ends on the Sunday closest to December 31.
The three and twelve months ended January 1, 2023 and
January 2, 2022 included thirteen and fifty-two weeks,
respectively.
(b) General and administrative
expenses include certain executive transition, litigation and other
professional expenses of $0.4 million for the three months ended
January 2, 2022, and $3.8 million and $1.7 million for the
twelve months ended January 1, 2023 and January 2, 2022,
respectively.
(c) General and administrative
expenses include stock-based compensation expense of $1.1 million
and $1.7 million for the three months ended January 1, 2023
and January 2, 2022, respectively, and $4.9 million and $6.2
million for the twelve months ended January 1, 2023 and
January 2, 2022, respectively.
(d) Other expense (income),
net, for the three months ended January 1, 2023 included a
loss on disposal of assets of $0.2 million. Other expense
(income), net, for the twelve months ended January 1, 2023,
included loss on sale leaseback transactions of $0.4 million,
a loss on disposal of assets of $1.2 million and a gain from a
settlement with a vendor of $2.5 million. Other expense
(income), net, for the three months ended January 2, 2022,
included a gain of $1.1 million from the sale of a litigation claim
during the period, insurance recoveries from previous property
damage at our restaurants of $0.2 million and a loss on disposal of
assets of $0.3 million. Other expense (income), net, for the twelve
months ended January 2, 2022, included a $1.1 million
gain from the sale of a litigation claim during the period, a gain
from insurance recoveries of $1.3 million related to property
damage at two of the Company's restaurants and a loss on disposal
of assets of $1.2 million.
(e) Basic net loss per share
was computed without attributing any loss to preferred stock and
non-vested restricted shares as losses are not allocated to
participating securities under the two-class method.
(f) Diluted net loss per share
was computed including shares issuable for convertible preferred
stock and non-vested restricted shares unless their effect would
have been anti-dilutive for the periods presented.
Carrols Restaurant Group,
Inc.
Supplemental Information
The following table sets forth certain unaudited
supplemental financial and other data for the periods indicated (in
thousands, except number of restaurants, percentages and average
weekly sales per restaurant):
|
(unaudited) |
|
Three Months Ended |
|
Twelve Months Ended |
|
January 1, 2023 |
|
January 2, 2022 |
|
January 1, 2023 |
|
January 2, 2022 |
Revenue: |
|
|
|
|
|
|
|
Burger King restaurant sales |
$ |
423,285 |
|
|
$ |
395,976 |
|
|
$ |
1,642,725 |
|
|
$ |
1,568,431 |
|
Popeyes restaurant sales |
|
21,773 |
|
|
|
20,157 |
|
|
|
87,715 |
|
|
|
83,939 |
|
Total revenue |
$ |
445,058 |
|
|
$ |
416,133 |
|
|
$ |
1,730,440 |
|
|
$ |
1,652,370 |
|
Change in Comparable Burger
King Restaurant Sales (a) |
|
6.2 |
% |
|
|
7.4 |
% |
|
|
3.9 |
% |
|
|
9.1 |
% |
Change in Comparable Popeyes
Restaurant Sales (a) |
|
9.2 |
% |
|
|
1.0 |
% |
|
|
4.9 |
% |
|
(1.9 |
)% |
|
|
|
|
|
|
|
|
Average Weekly Sales per
Burger King Restaurant (b) |
$ |
31,858 |
|
|
$ |
29,812 |
|
|
$ |
30,870 |
|
|
$ |
29,687 |
|
Average Weekly Sales per
Popeyes Restaurant (b) |
$ |
26,107 |
|
|
$ |
24,119 |
|
|
$ |
26,036 |
|
|
$ |
24,983 |
|
|
|
|
|
|
|
|
|
Adjusted Restaurant-Level
EBITDA (c) |
$ |
46,934 |
|
|
$ |
34,183 |
|
|
$ |
141,863 |
|
|
$ |
156,958 |
|
Adjusted Restaurant-Level
EBITDA margin (c) |
|
10.5 |
% |
|
|
8.2 |
% |
|
|
8.2 |
% |
|
|
9.5 |
% |
|
|
|
|
|
|
|
|
Adjusted EBITDA (c) |
$ |
25,383 |
|
|
$ |
13,853 |
|
|
$ |
62,470 |
|
|
$ |
81,608 |
|
Adjusted EBITDA margin
(c) |
|
5.7 |
% |
|
|
3.3 |
% |
|
|
3.6 |
% |
|
|
4.9 |
% |
|
|
|
|
|
|
|
|
Adjusted Net Loss (c) |
$ |
(2,485 |
) |
|
$ |
(7,457 |
) |
|
$ |
(35,743 |
) |
|
$ |
(21,278 |
) |
Adjusted Diluted Net Loss per
share (c) |
$ |
(0.05 |
) |
|
$ |
(0.15 |
) |
|
$ |
(0.70 |
) |
|
$ |
(0.43 |
) |
|
|
|
|
|
|
|
|
Number of Burger King
restaurants: |
|
|
|
|
|
|
|
Restaurants at beginning of period |
|
1,022 |
|
|
|
1,027 |
|
|
|
1,026 |
|
|
|
1,009 |
|
New restaurants (including offsets) |
|
2 |
|
|
|
1 |
|
|
|
6 |
|
|
|
4 |
|
Restaurants acquired |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
19 |
|
Restaurants closed (including offsets) |
|
(2 |
) |
|
|
(2 |
) |
|
|
(10 |
) |
|
|
(6 |
) |
Restaurants at end of period |
|
1,022 |
|
|
|
1,026 |
|
|
|
1,022 |
|
|
|
1,026 |
|
Average Number of operating
Burger King restaurants: |
|
1,022.0 |
|
|
|
1,021.7 |
|
|
|
1,023.4 |
|
|
|
1,016.0 |
|
|
|
|
|
|
|
|
|
Number of Popeyes
restaurants: |
|
|
|
|
|
|
|
Restaurants at beginning and end of period |
|
65 |
|
|
|
65 |
|
|
|
65 |
|
|
|
65 |
|
Average Number of operating
Popeyes restaurants: |
|
64.2 |
|
|
|
64.3 |
|
|
|
64.8 |
|
|
|
64.6 |
|
(a) Restaurants are generally
included in comparable restaurant sales 12 months after their
acquisition. Sales from newly developed restaurants are included in
comparable restaurant sales after they have been open for 15
months. The calculation of changes in comparable restaurant sales
is based on a comparison to the comparable thirteen or fifty-two
week period.
(b) Average weekly sales per
restaurant are derived by dividing restaurant sales for the
thirteen or fifty-two week period by the average number of
restaurants operating during such period.
(c) EBITDA, Adjusted
Restaurant-Level EBITDA, Adjusted Restaurant-Level EBITDA margin,
Adjusted EBITDA, Adjusted EBITDA margin, Adjusted Net Loss and
Adjusted Diluted Net Loss per share are non-GAAP financial measures
and may not necessarily be comparable to other similarly titled
captions of other companies due to differences in methods of
calculation. Refer to the Company's reconciliation of net loss to
EBITDA, Adjusted EBITDA, Adjusted Net Loss and to the Company's
reconciliation of loss from operations to Adjusted Restaurant-Level
EBITDA for further detail. Both Adjusted EBITDA margin and Adjusted
Restaurant-Level EBITDA margin are calculated as a percentage of
restaurant sales. Adjusted Diluted Net Loss per share is calculated
based on Adjusted Net Loss and reflects the dilutive impact of
shares, where applicable.
Carrols Restaurant Group, Inc. |
Reconciliation of Non-GAAP Measures |
(In thousands, except per share amounts) |
|
|
(unaudited) |
|
Three Months Ended (a) |
|
Twelve Months Ended (a) |
|
January 1, 2023 |
|
January 2, 2022 |
|
January 1, 2023 |
|
January 2, 2022 |
Reconciliation of
EBITDA and Adjusted EBITDA: (b) |
|
|
|
|
|
|
|
Net loss |
$ |
(19,130 |
) |
|
$ |
(16,400 |
) |
|
$ |
(75,572 |
) |
|
$ |
(43,029 |
) |
Provision (benefit) for income taxes |
|
14,053 |
|
|
|
(997 |
) |
|
|
(789 |
) |
|
|
(5,159 |
) |
Interest expense |
|
7,873 |
|
|
|
7,399 |
|
|
|
30,841 |
|
|
|
28,791 |
|
Depreciation and amortization |
|
19,171 |
|
|
|
19,667 |
|
|
|
78,068 |
|
|
|
80,798 |
|
EBITDA |
|
21,967 |
|
|
|
9,669 |
|
|
|
32,548 |
|
|
|
61,401 |
|
Impairment and other lease charges |
|
2,009 |
|
|
|
3,189 |
|
|
|
21,877 |
|
|
|
4,470 |
|
Acquisition costs (c) |
|
— |
|
|
|
(2 |
) |
|
|
— |
|
|
|
398 |
|
Pre-opening costs (d) |
|
119 |
|
|
|
16 |
|
|
|
292 |
|
|
|
75 |
|
Executive transition, litigation and other professional expenses
(e) |
|
20 |
|
|
|
363 |
|
|
|
3,777 |
|
|
|
1,678 |
|
Other expense (income), net (f)(g) |
|
183 |
|
|
|
(1,075 |
) |
|
|
(926 |
) |
|
|
(1,186 |
) |
Stock-based compensation expense |
|
1,085 |
|
|
|
1,693 |
|
|
|
4,902 |
|
|
|
6,234 |
|
Loss on extinguishment of debt |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
8,538 |
|
Adjusted
EBITDA |
$ |
25,383 |
|
|
$ |
13,853 |
|
|
$ |
62,470 |
|
|
$ |
81,608 |
|
|
|
|
|
|
|
|
|
Reconciliation of
Adjusted Restaurant-Level EBITDA: (a) |
|
|
|
|
|
|
|
Income (loss) from operations |
$ |
2,796 |
|
|
$ |
(9,998 |
) |
|
$ |
(45,520 |
) |
|
$ |
(10,859 |
) |
Add: |
|
|
|
|
|
|
|
General and administrative expenses |
|
22,656 |
|
|
|
22,384 |
|
|
|
88,072 |
|
|
|
83,660 |
|
Pre-opening costs (d) |
|
119 |
|
|
|
16 |
|
|
|
292 |
|
|
|
75 |
|
Depreciation and amortization |
|
19,171 |
|
|
|
19,667 |
|
|
|
78,068 |
|
|
|
80,798 |
|
Impairment and other lease charges |
|
2,009 |
|
|
|
3,189 |
|
|
|
21,877 |
|
|
|
4,470 |
|
Other expense (income), net (f)(g) |
|
183 |
|
|
|
(1,075 |
) |
|
|
(926 |
) |
|
|
(1,186 |
) |
Adjusted
Restaurant-Level EBITDA |
$ |
46,934 |
|
|
$ |
34,183 |
|
|
$ |
141,863 |
|
|
$ |
156,958 |
|
|
|
|
|
|
|
|
|
Reconciliation of
Adjusted Net Loss: (b) |
|
|
|
|
|
|
|
Net loss |
$ |
(19,130 |
) |
|
$ |
(16,400 |
) |
|
$ |
(75,572 |
) |
|
$ |
(43,029 |
) |
Add: |
|
|
|
|
|
|
|
Impairment and other lease charges |
|
2,009 |
|
|
|
3,189 |
|
|
|
21,877 |
|
|
|
4,470 |
|
Acquisition costs (c) |
|
— |
|
|
|
(2 |
) |
|
|
— |
|
|
|
398 |
|
Pre-opening costs (d) |
|
119 |
|
|
|
16 |
|
|
|
292 |
|
|
|
75 |
|
Executive transition, litigation and other professional expenses
(e) |
|
20 |
|
|
|
363 |
|
|
|
3,777 |
|
|
|
1,678 |
|
Other expense (income), net (f)(g) |
|
183 |
|
|
|
(1,075 |
) |
|
|
(926 |
) |
|
|
(1,186 |
) |
Loss on extinguishment of debt |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
8,538 |
|
Income tax effect on above adjustments (h) |
|
(583 |
) |
|
|
(623 |
) |
|
|
(6,256 |
) |
|
|
(3,494 |
) |
Valuation allowance for deferred taxes (i) |
|
14,897 |
|
|
|
7,075 |
|
|
|
21,065 |
|
|
|
11,272 |
|
Adjusted Net
Loss |
$ |
(2,485 |
) |
|
$ |
(7,457 |
) |
|
$ |
(35,743 |
) |
|
$ |
(21,278 |
) |
Adjusted diluted net loss per
share (j) |
$ |
(0.05 |
) |
|
$ |
(0.15 |
) |
|
$ |
(0.70 |
) |
|
$ |
(0.43 |
) |
Adjusted diluted weighted
average common shares outstanding |
|
50,807 |
|
|
|
49,928 |
|
|
|
50,718 |
|
|
|
49,899 |
|
(a) The Company uses a 52 or 53
week fiscal year that ends on the Sunday closest to December 31.
The three and twelve months ended January 1, 2023 and
January 2, 2022 included thirteen and fifty-two weeks,
respectively.
(b) Within this press release,
we make reference to EBITDA, Adjusted EBITDA, Adjusted
Restaurant-Level EBITDA and Adjusted Net Loss which are non-GAAP
financial measures. EBITDA represents net loss before income taxes,
interest expense and depreciation and amortization. Adjusted EBITDA
represents EBITDA as adjusted to exclude impairment and other lease
charges, acquisition costs, stock-based compensation expense,
restaurant pre-opening costs, non-recurring litigation and other
professional expenses, loss on extinguishment of debt and other
income and expense. Adjusted Restaurant-Level EBITDA represents
loss from operations as adjusted to exclude general and
administrative expenses, restaurant pre-opening costs, depreciation
and amortization, impairment and other lease charges and other
income and expense. Adjusted Net Loss represents net loss as
adjusted, net of tax, to exclude impairment and other lease
charges, acquisition costs, restaurant pre-opening costs,
non-recurring litigation and other professional expenses, other
income and expense, loss on extinguishment of debt and deferred tax
valuation allowance changes.
Adjusted EBITDA, Adjusted Restaurant-Level
EBITDA and Adjusted Net Loss are presented because the Company
believes that they provide a more meaningful comparison than EBITDA
and net loss of its core business operating results, as well as
with those of other similar companies. Additionally, Adjusted
Restaurant-Level EBITDA is presented because it excludes restaurant
pre-opening costs, other income and expense, and the impact of
general and administrative expenses, which primarily represents
salaries and expenses for corporate and administrative functions
that support the development and operations of our restaurants as
well as legal, auditing and other professional fees. Although these
costs are not directly related to restaurant-level operations,
these expenses are necessary for the profitability of our
restaurants. Management believes that Adjusted EBITDA, Adjusted
Restaurant-Level EBITDA and Adjusted Net Loss, when viewed with the
Company's results of operations in accordance with U.S. GAAP and
the accompanying reconciliations in the table above, provide useful
information about operating performance and period-over-period
growth, and provide additional information that is useful for
evaluating the operating performance of the Company's core business
without regard to potential distortions. Additionally, management
believes that Adjusted EBITDA and Adjusted Restaurant-Level EBITDA
permit investors to gain an understanding of the factors and trends
affecting our ongoing cash earnings, from which capital investments
are made and debt is serviced.
However, EBITDA, Adjusted EBITDA, Adjusted
Restaurant-Level EBITDA and Adjusted Net Loss are not measures of
financial performance or liquidity under U.S. GAAP and,
accordingly, should not be considered as alternatives to net loss
from operations or cash flow from operating activities as
indicators of operating performance or liquidity. Also, these
measures may not be comparable to similarly titled captions of
other companies. The tables above provide reconciliations between
net loss and EBITDA, Adjusted EBITDA and Adjusted Net Loss and
between loss from operations and Adjusted Restaurant-Level
EBITDA.
(c) Acquisition costs for the
three and twelve months ended January 2, 2022 mostly include
integration, travel, legal and professional fees incurred in
connection with restaurants acquired during the second quarter of
2021, which were included in general and administrative
expenses.
(d) Pre-opening costs for the
three and twelve months ended January 1, 2023 and
January 2, 2022 include training, labor and occupancy costs
incurred during the construction of new restaurants.
(e) Executive transition,
litigation and other professional expenses for the three and twelve
months ended January 1, 2023 and January 2, 2022 include
executive search and transition costs, costs pertaining to an
ongoing lawsuit with one of the Company's former vendors and other
non-recurring professional service expenses.
(f) Other expense (income),
net, for the three months ended January 1, 2023 included a
loss on disposal of assets of $0.2 million. Other expense
(income), net, for the twelve months ended January 1, 2023,
included loss on sale leaseback transactions of $0.4 million,
a loss on disposal of assets of $1.2 million and a gain from a
settlement with a vendor of $2.5 million.
(g) Other expense (income),
net, for the three months ended January 2, 2022, included a
gain of $1.1 million from the sale of a litigation claim during the
period, insurance recoveries from previous property damage at our
restaurants of $0.2 million and a loss on disposal of assets
of $0.3 million. Other expense (income), net, for the twelve
months ended January 2, 2022, included a $1.1 million
gain from the sale of a litigation claim during the period, a gain
from insurance recoveries of $1.3 million related to property
damage at two of the Company's restaurants and a loss on disposal
of assets of $1.2 million.
(h) The income tax effect
related to the adjustments to Adjusted Net Loss during the periods
presented was calculated using an incremental income tax rate of
25.0% for the three and twelve months ended January 1, 2023 and
January 2, 2022, respectively.
(i) Reflects the removal of the
income tax provision recorded to increase the valuation allowance
on our net deferred income tax assets during the three and twelve
months ended January 1, 2023 and January 2, 2022,
respectively.
(j) Adjusted diluted net loss
per share is calculated based on Adjusted Net Loss and the dilutive
weighted average common shares outstanding for the respective
periods, where applicable.
Carrols Restaurant Group, Inc. |
Reconciliation of Non-GAAP Measures |
(In thousands, except per share amounts) |
|
|
(unaudited) |
|
Three Months Ended (a) |
|
Twelve Months Ended (a) |
|
January 1, 2023 |
|
January 2, 2022 |
|
January 1, 2023 |
|
January 2, 2022 |
Reconciliation of Free
Cash Flow: (b) |
|
|
|
|
|
|
|
Net cash provided by operating activities |
$ |
22,946 |
|
|
$ |
20,644 |
|
|
$ |
20,804 |
|
|
$ |
70,871 |
|
Net cash used for investing
activities |
|
(8,479 |
) |
|
|
(11,876 |
) |
|
|
(37,245 |
) |
|
|
(58,579 |
) |
Net cash paid for
acquisitions, net of related sale-leasebacks |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
10,633 |
|
Total Free Cash
Flow |
$ |
14,467 |
|
|
$ |
8,768 |
|
|
$ |
(16,441 |
) |
|
$ |
22,925 |
|
|
At 1/1/2023 |
|
|
At 1/2/2022 |
Long-term debt and finance lease liabilities (c) |
$ |
|
492,951 |
|
|
$ |
478,181 |
|
Cash and cash equivalents |
|
|
18,364 |
|
|
|
29,151 |
|
Net Debt (d) |
|
|
474,587 |
|
|
|
449,030 |
|
Senior Secured Net Debt
(e) |
|
|
174,587 |
|
|
|
149,030 |
|
Total Net Debt Leverage Ratio
(f) |
7.14 |
x |
|
|
5.02 |
x |
Senior Secured Net Debt
Leverage Ratio (g) |
2.63 |
x |
|
|
1.67 |
x |
(a) The Company uses a 52 or 53
week fiscal year that ends on the Sunday closest to December 31.
The three and twelve months ended January 1, 2023 and
January 2, 2022 both included thirteen and fifty-two weeks,
respectively.
(b) Free Cash Flow is a
non-GAAP financial measure and may not necessarily be comparable to
other similarly titled captions of other companies due to
differences in methods of calculation. Free Cash Flow is defined as
cash provided by operating activities less cash used for investing
activities, adjusted to add back net cash paid for acquisitions
(excluding proceeds from acquisition-related sale-leaseback
transactions completed in the third quarter of 2021). Management
believes that Free Cash Flow, when viewed with the Company's
results of operations in accordance with U.S. GAAP and the
accompanying reconciliations in the table above, provides useful
information about the Company's cash flow for liquidity purposes
and to service the Company's debt. However, Free Cash Flow is not a
measure of liquidity under U.S GAAP, and, accordingly should not be
considered as an alternative to the Company's consolidated
statements of cash flows and net cash provided by operating
activities, net cash used for investing activities and net cash
provided by financing activities as indicators of liquidity or cash
flow. Free Cash Flow for the three months ended January 1,
2023 and January 2, 2022 is derived from the Company's
consolidated statements of cash flows for the respective twelve
month periods to be presented in the Company’s Consolidated
Financial Statements in its Form 10-K for the period ended
January 1, 2023 and the Company's consolidated statements of
cash flows for the previously reported nine month periods ended
October 2, 2022 and October 3, 2021 contained in the Company’s Form
10-Q for the period ended October 2, 2022.
(c) Long-term debt and finance
lease liabilities (including current portion and excluding deferred
financing costs and original issue discount) at January 1,
2023 included $167,625 of outstanding term B loans and $12,500 of
outstanding revolving borrowings under the Company's senior credit
facilities, $300,000 of 5.875% Senior Notes due 2029 and $12,826 of
finance lease liabilities. Long-term debt and finance lease
liabilities (including current portion and excluding deferred
financing costs and original issue discount) at January 2,
2022 included $171,875 of term B loans, $300,000 of 5.875% Senior
Notes due 2029 and $6,306 of finance lease liabilities.
(d) Net Debt represents total
long-term debt and finance lease liabilities less cash and cash
equivalents.
(e) Senior Secured Net Debt
represents total net debt less the $300 million of unsecured 5.875%
Senior Notes, due 2029.
(f) Total Net Debt Leverage
Ratio represents the Company's Total Net Debt Leverage Ratio as
calculated in accordance with its senior credit facility for each
period presented.
(g) Senior Secured Net Debt
Leverage Ratio represents the Company's Net Debt Leverage Ratio as
calculated in accordance with its senior credit facility for each
period presented.
Carrols Restaurant (NASDAQ:TAST)
Historical Stock Chart
From May 2024 to Jun 2024
Carrols Restaurant (NASDAQ:TAST)
Historical Stock Chart
From Jun 2023 to Jun 2024