Good Times Restaurants Inc. (Nasdaq: GTIM), operator of Bad
Daddy’s Burger Bar and Good Times Burgers & Frozen Custard, a
regional quick-service restaurant chain, today reported financial
results for the fiscal quarter ended December 29, 2020.
Key highlights of the Company’s financial results
include:
- Total Revenues decreased 11.4% to $27.3 million for the 13-week
quarter, compared against a 14-week quarter in fiscal 2020
- Total Restaurant Sales for Bad Daddy’s restaurants were $18.7
million for the quarter
- Same Store Sales1 for company-owned Bad Daddy’s restaurants
decreased 11.8% for the quarter, impacted by dining room closures
in our Colorado restaurants
- Total Restaurant Sales for Good Times restaurants increased
$0.6 million to $8.4 million
- Same Store Sales for company-owned Good Times restaurants
increased 22.1% for the quarter
- Net Income Attributable to Common Shareholders was $0.8 million
for the quarter
- Adjusted EBITDA2 (a non-GAAP measure) for the quarter was $1.8
million
- The Company ended the quarter with $10.0 million in cash, $4.0
million outstanding under its senior credit facility and $11.6
million in outstanding Paycheck Protection Program loans
Ryan M. Zink, the Company’s Chief Executive Officer, said, “I am
pleased with our performance for the quarter. We increased Net
Income of the Company to $0.8 million, continued to experience
strong same store sales for the Good Times brand, and maintained
restaurant-level operating profit3 (a non-GAAP measure) for the Bad
Daddy’s brand. We believe our results compared to 2020 are even
more impressive when considering that this year’s quarter has one
fewer operating week than did 2020 and that our Colorado Bad
Daddy’s were required to close their indoor dining rooms mid-way
through November and were closed for the remainder of the quarter.
We have since re-opened dining rooms and Bad Daddy’s sales have
meaningfully improved in the new calendar year, with that brand
reporting same stores sales of (8.3%) for our fiscal January. Good
Times continues its streak of double-digit same store sales,
posting +24.6% for January.”
Mr. Zink continued, “At Good Times, we continue to focus on
speed and accuracy in the drive-thru. We intend to introduce a new
shake program mid-year and continue to generate “new news” through
rotating seasonal features that have proven successful. We continue
to utilize radio as our primary advertising medium but are also now
actively using targeted digital and social ad placements to actual
customers using the same technology platform we began using in Bad
Daddy’s during 2020. At Bad Daddy’s, we implemented new packaging
to enhance temperature hold times and the quality of food served in
to-go and delivery formats, are testing a new Carnitas Nachos
appetizer that showcases the scratch-made nature of our kitchen,
and have twenty-four restaurants running our virtual brand, Bad
Mama’s Chicken. Sales from Bad Mama’s account for approximately two
percent of sales in restaurants where we have rolled out the
virtual brand, in-line with our target. We are on-track to open two
restaurants during the remainder of our fiscal year, in the
greater-Atlanta and Montgomery designated market areas (DMAs).”
“Above all, I continue to be thankful for the high-performing
team that is executing each of our concepts and the restaurant
support team who together are responsible for delivering these
results. We have a mission to delight every guest; we achieve that
at Good Times through a focus on speed and accuracy with an
all-natural platform, and at Bad Daddy’s through dedication to
scratch cooking in our kitchens and genuine, southern-rooted
hospitality. In both cases, we believe that, by living these
principles, we will create emotional connections to our brands, and
in the long-run, drive consistent sales increases,” Zink
concluded.
Fiscal 2021 Outlook:
Due to continuing unprecedented economic conditions associated
with the ongoing COVID-19 pandemic and unpredictable nature of
COVID-19 and government responses to the evolving situation, the
Company has not provided a financial outlook for the remainder of
the 2021 fiscal year. In late November 2020, all twelve of the
Company’s Bad Daddy’s locations in Colorado had additional
restrictions imposed upon them resulting in the closure of dining
rooms in those locations. Although these dining rooms have since
re-opened and no other states have at this time similarly
restricted inside dining where the Company has Bad Daddy’s
restaurants, the possibility remains that such restrictions might
be put in place with limited notice. At the current time, the
Company is therefore still unable to reasonably estimate the full
impact of the continuing pandemic to ongoing operations and results
and is unable to provide a financial outlook for the remainder of
fiscal 2021.
Conference Call: Management will host a conference call
to discuss its first quarter 2021 financial results on Thursday,
February 4, 2021 at 3:00 p.m. MT/5:00 p.m. ET. Hosting the call
will be Ryan M. Zink, its Chief Executive Officer.
The conference call can be accessed live over the phone by
dialing (888) 339-0806 and requesting the Good Times Restaurants
(GTIM) call. 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.
About Good Times Restaurants Inc.: Good Times Restaurants
Inc. (GTIM) owns, operates, franchises and licenses 39 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 microbrew beers in a high-energy atmosphere that
appeals to a broad consumer base. Additionally, through its
wholly-owned subsidiaries, Good Times Restaurants Inc. operates and
franchises a regional quick-service restaurant chain consisting of
32 Good Times Burgers & Frozen Custard restaurants located
primarily in Colorado.
Forward Looking Statements Disclaimer:
This press release contains forward looking statements within
the meaning of federal securities laws. The words “intend,” “may,”
“believe,” “will,” “should,” “anticipate,” “expect,” “seek” 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.
These risks include such factors as the disruption to our business
from the novel coronavirus (COVID-19) pandemic and the impact of
the pandemic on our results of operations, financial condition and
prospects which may vary depending on the duration and extent of
the pandemic and the impact of federal, state and local
governmental actions and customer behavior in response to the
pandemic, the lack of assurance that the full amount of the PPP
loans will be forgiven, 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, and other matters discussed under the Risk Factors
section of Good Times’ Annual Report on Form 10-K for the fiscal
year ended September 29, 2020 filed with the SEC, and other filings
with the SEC . Good Times disclaims any obligation or duty to
update or modify these forward-looking statements.
Category: Financial
Good Times Restaurants
Inc.
Unaudited Supplemental
Information
(In thousands, except per share
amounts)
Fiscal First Quarter
(13 weeks)
(14 weeks)
Statement of Operations
2021
2020
Net revenues:
Restaurant sales
$
27,081
$
30,593
Franchise revenues
215
221
Total net revenues
27,296
30,814
Restaurant Operating Costs:
Food and packaging costs
7,841
9,306
Payroll and other employee benefit
costs
8,881
11,979
Restaurant occupancy costs
2,195
2,438
Other restaurant operating costs
3,469
3,002
Pre-opening costs
39
802
Depreciation and amortization
929
1,079
Total restaurant operating costs
23,354
28,606
General and administrative costs
2,174
2,053
Advertising costs
509
546
Franchise costs
5
-
Gain on disposal of restaurants and
equipment
(9
)
(19
)
Income (Loss) from operations
1,263
(372
)
Interest expense, net
(98
)
(227
)
Net income (loss)
1,165
(599
)
Income attributable to non-controlling
interests
(363
)
(212
)
Net income (loss) attributable to common
shareholders
$
802
$
(811
)
Basic and diluted loss per share
$
0.06
$
(0.06
)
Basic weighted average common shares
outstanding
12,622
12,597
Diluted weighted average common shares
outstanding
12,698
N/A
Certain prior year balances have been
reclassified to conform to the current year’s presentation. Such
reclassifications had no effect on the net loss. Notable
reclassifications include the recategorization of paper goods costs
from other restaurant operating costs to food and packaging costs,
and payroll and related expenses related to managers-in-training
from general and administrative to direct payroll and other
benefits.
Good Times Restaurants
Inc.
Unaudited Supplemental
Information
(In thousands)
December 29, 2020
September 29, 2020
Balance Sheet Data
Cash and cash equivalents
$
10,015
$
11,454
Total assets
$
97,249
$
99,693
Current maturities of long-term debt
$
7,693
$
6,242
Long-term debt due after one year
$
7,952
$
10,903
Stockholders’ equity
$
15,903
$
14,983
Supplemental Information for
Company-Owned Restaurants (dollars in thousands):
Bad Daddy’s Burger Bar
Good Times Burgers &
Frozen Custard
-------------------------- Fiscal First
Quarter------------------------------
2021 (13 weeks)
2020 (14 weeks)
2021 (13 weeks)
2020 (14 weeks)
Restaurant sales
$
18,691
$
22,813
$
8,390
$
7,780
Restaurants opened during period
-
2
-
-
Restaurants closed during period
-
-
1
-
Restaurants open at period end
37
37
24
25
Restaurant operating weeks
481.0
508.6
318.0
350.0
Average weekly sales per restaurant
$
38.9
$
44.9
$
26.4
$
22.2
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.
--------------------------------------------------------------------
Fiscal Quarter
Ended----------------------------------------------------------------------------
December 29, 2020 (13
weeks)
December 31, 2019 (14
weeks)
December 29, 2020 (13
weeks)
December 31, 2019 (14
weeks)
Dec 29, 2020 (13
weeks)
Dec 31, 2019 (14
weeks)
Restaurant sales
$
18,691
100.0
%
$
22,813
100.0
%
$
8,390
100.0
%
$
7,780
100.0
%
$
27,081
$
30,593
Restaurant operating costs (exclusive of
depreciation and amortization shown separately below):
Food and packaging costs
5,356
28.7
%
6,892
30.2
%
2,485
29.6
%
2,414
31.0
%
7,841
9,306
Payroll and benefits costs
6,267
33.5
%
9,003
39.5
%
2,614
31.2
%
2,976
38.3
%
8,881
11,979
Restaurant occupancy costs
1,454
7.8
%
1,644
7.2
%
741
8.8
%
794
10.2
%
2,195
2,438
Other restaurant operating costs
2,648
14.1
%
2,291
10.0
%
821
9.8
%
711
9.1
%
3,469
3,002
Restaurant-level operating profit
$
2,966
15.8
%
$
2,983
13.1
%
$
1,729
20.6
%
$
885
11.3
%
$
4,695
$
3,868
Franchise revenues
215
221
Deduct - Other operating:
Depreciation and amortization
929
1,079
General and administrative
2,174
2,053
Advertising costs
509
546
Franchise costs
5
-
Gain on restaurant asset sale
(9
)
(19
)
Pre-opening costs
39
802
Total other operating
3,647
4,461
Income (loss) from operations
$
1,263
$
(372
)
Certain percentage amounts in the table above
do 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). Certain prior year
balances have been reclassified to conform to the current year’s
presentation. Such reclassifications had no effect on the net loss
from operations. Notable reclassifications include the
recategorization of paper goods costs from other restaurant
operating costs to food and packaging costs, and payroll and
related expenses related to managers-in-training from general and
administrative to direct payroll and other benefits.
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 2021 and fiscal 2020,
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 Income (Loss) to
Non-GAAP Adjusted EBITDA (Thousands of US Dollars)
Fiscal Quarter Ended
December 29, 2020 (13
weeks)
December 31, 2019 (14
weeks)
Net income (loss), as reported
$
802
$
(811
)
Depreciation and amortization 4
909
1,069
Interest expense, net
98
227
EBITDA
1,809
485
Pre-opening expense
39
801
Non-cash stock-based compensation
61
75
Non-recurring severance costs
-
41
GAAP rent-cash rent difference
(107
)
121
Non-cash gain on disposal of assets
(9
)
(9
)
Adjusted EBITDA
$
1,793
$
1,514
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 Sales 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 For a reconciliation of Adjusted EBITDA to the most directly
comparable financial measures presented in accordance with GAAP and
a discussion of why the Company considers them useful, see the
financial information schedules accompanying this release.
3 For a reconciliation of restaurant level operating profit to
the most directly comparable financial measures presented in
accordance with GAAP and a discussion of why the Company considers
them useful, see the financial information schedules accompanying
this release.
4 Depreciation and amortization expense have been reduced by
amounts attributable to non-controlling interests of $41 thousand
for each respective quarter.
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version on businesswire.com: https://www.businesswire.com/news/home/20210204005133/en/
GOOD TIMES RESTAURANTS INC. CONTACTS: Ryan M. Zink, Chief
Executive Officer (303) 384-1432 Christi Pennington (303)
384-1440
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