Pro Forma for Integration Synergies, Annualized
Adjusted Cash EPS to Exceed $1.10
Targeting Annualized Cash Dividend of $0.48 per
common share in 2018
FAT (Fresh. Authentic. Tasty.) Brands Inc.
(NASDAQ:FAT) (“FAT Brands” or the “Company”) today announced that
it has signed a definitive agreement to acquire Hurricane Grill
& Wings (“Hurricanes”) for $12.5 million. The acquisition will
be funded with cash on hand and third party financing, and is
expected to close in 2017, subject to customary closing conditions
including the receipt of financing.
Pro forma for the acquisition and expected synergies from the
combined companies, the Company expects its annualized revenue to
exceed $17 million and annualized adjusted cash earnings to exceed
$11 million, or $1.10 per common share based on 10 million shares
outstanding. The combined company’s franchisees will operate
approximately 350 restaurants around the globe, with system-wide
sales exceeding $360 million.
Established in 1995, Hurricane Grill & Wings offers jumbo
fresh wings paired with over 35 signature sauces and rubs, with a
diverse menu featuring fresh food options like fries, tacos and
burgers. Hurricanes operates more than 60 locations across the U.S.
The Company plans to leverage Hurricanes’ signature tropical,
laid-back American atmosphere to complement its existing portfolio
brand, Buffalo’s Cafe. With a combined presence of more than 75
restaurants dedicated to serving high-quality chicken wings in the
southeastern United States, this acquisition will represent a
significant opportunity for both synergies and expansion by FAT
Brands.
“Hurricane Grill & Wings possesses an ambiance that appeals
to a broad consumer-base, and we are thrilled to have identified
this concept which shares our passion for providing guests with an
all-American experience through high-quality, made-to-order meals,”
said Andy Wiederhorn, President and CEO of FAT Brands. “We
see Hurricanes as a wonderful complement to our Buffalo’s Cafe and
Buffalo’s Express brands, and look forward to expanding the brand’s
footprint in both new and existing markets through our extensive
franchisee network. Their new fast casual brand Hurricane BTW
(burgers, tacos and wings) has a significant franchise development
pipeline and will nicely diversify the company into more fast
casual venues.”
Wiederhorn added, “Based on our expected free cash flow in 2018,
we expect to pay an annualized dividend of $0.48 per common share
starting in 2018, subject to the declaration and approval by the
board of directors, which represents an implied yield of
approximately 5% based on the current share price.”
Hurricane Grill & Wings President & CEO John Metz
stated, “Joining the FAT Brands Inc. family will make Hurricane
Grill & Wings and Hurricane BTW significantly more competitive
in today’s landscape. We believe that this transaction will enable
us to leverage FAT Brands’ proven expertise and realize our global
growth potential.”
For more information, please visit www.fatbrands.com.
Fresh. Authentic. Tasty. Brands
FAT Brands (NASDAQ: FAT) is a leading global franchising company
that strategically acquires, markets and develops fast casual and
casual dining restaurant concepts around the world. The Company
currently owns five restaurant brands, Fatburger, Buffalo’s Cafe,
Buffalo’s Express and Ponderosa & Bonanza Steakhouses, that
have approximately 300 locations open and 300 under development in
32 countries.
About Hurricane Grill and Wings
With over 60 restaurants open or under construction in eight
states, Florida-based Hurricane Grill & Wings® is known for its
jumbo fresh wings, more than 35 signature sauces and rubs and
tropical, laid-back vibe. Named by USA Today as one of “10 Great
Places to Wing It;” selected as one of the “Future 50” by
Restaurant Business as well as one of Franchise Times “Top 40 Fast
and Serious,” Hurricane Grill & Wings’ menu includes crave-able
Hurricane’s Garlic & Parm fries, tasty salads, seafood entrees
and fresh ½ pound burgers. The brand’s signature Rum Bar with over
21 premium rums leads its tropical drinks menu, along with a wide
selection of craft beers and wines. The original Hurricane Grill
& Wings opened in Fort Pierce, Fla., in 1995 and has expanded
to locations in Alabama, Arizona, Colorado, Florida, Georgia,
Kansas, New York, and Texas. For more information, visit
www.hurricanewings.com.
Forward Looking
Statements
This press release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995, including statements relating to the timing and anticipated
benefits of the proposed acquisition of Hurricanes, the future
financial and operating results of the combined companies, and our
ability to pay a cash dividend to our common stockholders.
Forward-looking statements generally use words such as "expect,"
"foresee," "anticipate," "believe," "project," "should,"
"estimate," "will," "plans," "forecast," and similar expressions,
and reflect our expectations concerning the future. It is possible
that our future performance may differ materially from current
expectations expressed in these forward-looking statements. We
refer you to the documents we file from time to time with the
Securities and Exchange Commission, such as our recent Offering
Statement on Form 1-A and our reports on Form 10-K, Form 10-Q and
Form 8-K, for a discussion of these and other risks and
uncertainties that could cause our actual results to differ
materially from our current expectations and from the
forward-looking statements contained in this press release. We
undertake no obligation to update any forward-looking statement to
reflect events or circumstances occurring after the date of this
press release.
Non-GAAP Measures
This press release includes the non-GAAP financial measure of
adjusted cash earnings and earnings per share.
Adjusted cash EPS is defined as net income per share with the
following adjustments: 1) income taxes are added back to reflect
the usage of NOLs at the parent company level which are not paid in
cash, but rather credited against an intercompany receivable
between FAT Brands and its parent company; 2) the inclusion of
franchise fee deposits that are paid in cash, less franchise fees
recognized for which cash was received in prior periods.
We have not reconciled guidance for adjusted cash EPS to the
corresponding GAAP financial measures because we do not provide
guidance for the various reconciling items. We are unable to
provide guidance for these reconciling items because we cannot
determine their probable significance, as certain items are outside
of our control and cannot be reasonably predicted due to the fact
that these items could vary significantly from period to period.
Accordingly, a reconciliation to the corresponding GAAP financial
measure is not available without unreasonable effort.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20171115006035/en/
Investor Relations:ICRAlexis Tessier,
203-682-8286IR-FATBrands@icrinc.comorMedia Relations:Konnect
AgencyShelby Robinson/Emily Johnston,
213-988-8344srobinson@konnectagency.comejohnston@konnectagency.com
FAT Brands (NASDAQ:FAT)
Historical Stock Chart
From Mar 2024 to Apr 2024
FAT Brands (NASDAQ:FAT)
Historical Stock Chart
From Apr 2023 to Apr 2024