Revenues, Sales Rise at Good Times Restaurant
Good Times Restaurants Inc., operator of Good Times Burgers & Frozen Custard, a regional quick service restaurant chain focused on fresh, high quality, all natural products, and Bad Daddy’s Burger Bar, a full service, upscale concept, announced its preliminary unaudited financial results for the third fiscal quarter ended June 27.
Key highlights of the company’s financial results include:
Same store sales for company-owned Good Times restaurants increased 3.7 percent for the quarter on top of last year’s decrease of 2 percent Year to date, same store sales increased 1.2 percent versus last year’s increase of 0.8 percent.
Bad Daddy’s same store sales increased 0.1 percent during the quarter over the prior year’s increase of 3.6 percent. Excluding the Cherry Creek location which continues to be severely impacted by construction in the surrounding area, Bad Daddy’s same store sales increased 1 percent for the quarter. Year to date, same store sales increased 1.7 percent versus last year’s increase of 3.8 percent. Excluding the Cherry Creek location, same store sales increased 2.4 percent year to date.
Total revenues increased 20 percent to $21,702,000 for the quarter.
The company opened three new Bad Daddy’s restaurants during the quarter for a total of five new restaurants opened so far in fiscal 2017 and expects three more to open by fiscal year end.
The company opened one new Good Times restaurant during the year.
Sales for the Bad Daddy’s restaurants for the quarter increased 28 percent versus last year to $12,972,000 and Restaurant Level Operating Profit (a non-GAAP measure) increased 18 percent to $2,235,000 or 17.2 percent as a percent of sales.
Adjusted EBITDA (a non-GAAP measure) for the quarter was $1,396,000 versus $1,432,000 last year.
The company ended the quarter with $4.1 million in cash and $4.1 million of long-term debt.
Boyd Hoback, president & CEO, says, “Given the macro consumer spending and competitive environments, we are pleased with our positive comp sales for both of our brands. Our operating margins in the third quarter and in our guidance for the fiscal year are being negatively impacted by stubbornly high protein costs in beef, bacon and chicken as well as continued increases in our average hourly wages paid to our employees. However, our new restaurants opened this year are generating above average sales and we are excited to get the next three open in August and September in Oklahoma and North Carolina.”
Regarding initial fiscal 2018 guidance, Hoback adds, “We continue to expect 40 to 50 percent annual growth in our Adjusted EBITDA for the next few years as we grow out of cash flow from operations while maintaining a relatively conservative level of senior debt on our balance sheet. We have leases signed or in final negotiations for our planned fiscal 2018 growth in North Carolina, Tennessee, Georgia and Oklahoma.”
Fiscal 2017 Outlook:
The company provided the following guidance for fiscal 2017:
Total revenues of approximately $78 million to $79 million with a year-end revenue run rate of approximately $92 million
Total revenue estimates assume same store sales of approximately +3 percent for Good Times and flat to slightly negative for Bad Daddy’s in Q4
General and administrative expenses of approximately $7.0 million, including approximately $800,000 of non-cash equity compensation expense
The opening of a total of 8 new Bad Daddy’s restaurants (including 3 joint venture units) and 1 new Good Times restaurant
Total Adjusted EBITDA of approximately $3.5 million to $3.7 million
Restaurant pre-opening expenses of approximately $2.5 million
Capital expenditures (net of tenant improvement allowances and sales-leaseback proceeds) of approximately $11 to $11.5 million including approximately $1.0 to $1.5 million related to fiscal 2018 development
Fiscal year end long term debt of approximately $5 to $5.5 million
Fiscal 2018 Outlook:
The company provided the following initial guidance for fiscal 2018:
Total revenues of approximately $100 million to $102 million with a year-end revenue run rate of approximately $108 million to $110 million
Total revenue estimates assume same store sales of approximately +3 percent to +3.5 percent for Good Times and +1 to +2 percent for Bad Daddy’s
General and administrative expenses of approximately $8.0 to $8.2 million, including approximately $700,000 of non-cash equity compensation expense
The opening of a total of 7 new Bad Daddy’s restaurants (including 2 joint venture units)
Total Adjusted EBITDA of approximately $5 million to $5.5 million
Restaurant pre-opening expenses of approximately $2 million to $2.5 million
Capital expenditures (net of tenant improvement allowances) of approximately $10 million
Fiscal year end long term debt of approximately $11.0 - $11.5 million