Financial Data and Key Metrics Changes - Total first quarter revenues were $282.2 million, an increase of 16.4% compared to the previous year [23] - Same restaurant sales growth was positive at 0.7%, while same restaurant traffic was down 0.7% [23] - Adjusted EBITDA was $22.8 million, with adjusted EBITDA margins slipping to 8.1% from 11.8% [27][28] Business Line Data and Key Metrics Changes - The company opened 13 new system-wide restaurants during the quarter, including 10 company-owned and 3 franchise-owned [28] - New restaurants contributed significantly to revenue, with 33 new company-owned restaurants opened in the last two quarters [25][28] - Restaurant level operating profit margin was 16.5%, down from 20.8% in the same quarter last year [26] Market Data and Key Metrics Changes - The company experienced a return to positive traffic in January and March, with April showing the best monthly same restaurant traffic result in over two years [10][11] - The New England market is highlighted as a significant opportunity for expansion, with new locations performing above expectations [14] Company Strategy and Development Direction - The company is focused on growth through new restaurant openings and enhanced marketing efforts to drive brand awareness [9][12] - Strategic acquisitions of franchise restaurants in North and South Carolina and Missouri were completed to bolster presence in key states [15][16] - The company aims for double-digit percentage unit growth targets and a capital allocation strategy targeting cash on cash returns of around 35% [15] Management's Comments on Operating Environment and Future Outlook - Management noted that the macro environment remains volatile, with shifting expectations for consumer demand and input costs [9][10] - Despite current margin pressures from inflation and commodity costs, management believes these challenges are transitory [20][28] - The company maintains a positive outlook for the second half of 2025, expecting to sustain positive same restaurant traffic [33] Other Important Information - The company reported a net loss of $829,000 for the quarter [28] - Commodity inflation is expected to peak in the second quarter, with full-year expectations remaining in the high single digits [29][30] Q&A Session Summary Question: Can you expand on the comment that sales turned positive in March and then traffic turned positive in April? - Management noted that traffic trends improved sequentially, with positive dine-in traffic improvement for all four quarters last year [36][39] Question: What gives you confidence in driving traffic through third-party actions at a lower margin? - Management expressed confidence in the effectiveness of their strategies to drive traffic, despite cost pressures [40][41] Question: Can you discuss the learnings from increased media spend and engagement? - Management highlighted improved traffic trends as a result of their marketing efforts, with ongoing adjustments based on data [48][50] Question: What are your thoughts on commodity costs peaking in Q2? - Management explained that crop-related factors and the rebuilding of egg flocks contribute to the expectation of peaking commodity costs [51][52] Question: Can you elaborate on the marketing support across the system? - Almost the entire system is receiving marketing support, with elevated levels in certain markets [55][56] Question: How is the Florida market performing relative to the system? - Florida has outperformed the rest of the country, with continued new restaurant openings [96][97]

Financial Data and Key Metrics Changes - Total first quarter revenues were $282.2 million, an increase of 16.4% compared to the previous year [21] - Same restaurant sales growth was positive at 0.7%, while same restaurant traffic was down by 0.7% [21] - Adjusted EBITDA was $22.8 million, with adjusted EBITDA margins slipping to 8.1% from 11.8% [26][27] Business Line Data and Key Metrics Changes - The company opened 13 new system-wide restaurants during the quarter, including 10 company-owned and 3 franchise-owned [27] - Restaurant level operating profit margin decreased to 16.5% from 20.8% year-over-year [25] - Food and beverage expenses rose to 23.8% of sales compared to 21.8% in the same quarter last year, driven by commodity inflation [24] Market Data and Key Metrics Changes - The company reported a significant opportunity for expansion in the New England market, with successful openings in Massachusetts and plans for further locations in New Hampshire and Tennessee [12][13] - The Florida market has outperformed the rest of the country, with continued new restaurant openings [92] Company Strategy and Development Direction - The company is focused on growth through new restaurant openings and enhancing customer experiences, with a target of 59 to 64 net new system-wide restaurants for the year [30] - Strategic marketing efforts have been enhanced to drive brand awareness and customer engagement, particularly through digital and social media [10][11] - The company aims to maintain a long-term target of 18-20% on restaurant level operating profit margins [110] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the volatile macro environment affecting consumer demand and input costs, but expressed optimism about achieving positive traffic growth for the year [6][19] - The company expects commodity inflation to peak in the second quarter, with a forecast of high single-digit inflation for the full year [28][30] - Management remains confident in the brand's competitive positioning and customer service experience despite current margin pressures [19][90] Other Important Information - The company completed the acquisition of 16 restaurants in North and South Carolina and three in Missouri, enhancing its presence in key states [13] - The company is implementing a "surprise and delight" initiative to enhance customer loyalty, which has had a short-term impact on margins [17][74] Q&A Session Summary Question: Can you expand on the comment that sales turned positive in March and then traffic turned positive in April? - Management noted that traffic trends improved sequentially, with positive dine-in traffic improvement for all four quarters last year [36] Question: Can you talk more about the trade-off between driving traffic through third-party actions and other initiatives at a lower margin? - Management expressed confidence in the effectiveness of their strategies to drive traffic, despite cost pressures [38] Question: What are the learnings from the increased media spend and engagement following new media efforts? - Management reported positive results from the new media efforts, contributing to improved traffic trends [44] Question: Can you comment on the peak of commodity costs in Q2? - Management indicated that the peak is expected due to crop-related issues and rebuilding of egg flocks, but does not foresee this as a permanent issue [46] Question: How is the Florida market performing relative to the system? - Management stated that Florida has been performing well and continues to open new restaurants there [92]

Financial Performance - Total revenues increased by 164% to $28224 million in Q1 2025 from $242449 million in Q1 2024[23] - System-wide sales increased 115% to $3230 million in Q1 2025 from $289581 million in Q1 2024[23] - Same-restaurant sales growth was 07%[23] - Restaurant level operating profit margin decreased to 165% in Q1 2025 from 208% in Q1 2024[23] - Adjusted EBITDA decreased to $22753 million in Q1 2025 from $28590 million in Q1 2024[23] - Net loss was $(08) million in Q1 2025, compared to a net income of $7214 million in Q1 2024[23] Expansion and Outlook - The company opened 13 system-wide restaurants and closed 1, resulting in 584 system-wide restaurants across 30 states[23] - The company projects total revenue growth of approximately 200% for fiscal year 2025[51] - The company anticipates opening 59 to 64 new system-wide restaurants, net of 3 company-owned closures[51] - Adjusted EBITDA is projected to be in the range of $1140 million to $1190 million[51]

Financial Performance - Total revenues for the thirteen weeks ended March 30, 2025, were $282.24 million, an increase of 16.5% compared to $242.45 million for the same period in 2024[13] - Restaurant sales reached $279.59 million, up from $239.31 million, reflecting a growth of 16.8% year-over-year[13] - Net loss for the period was $829,000, compared to a net income of $7.21 million in the prior year, indicating a significant decline in profitability[13] - The company reported a comprehensive loss of $1.49 million for the quarter, compared to a comprehensive income of $8.14 million in the prior year[13] - The net cash provided by operating activities was $20.14 million, a decrease from $24.98 million in the same period last year[18] - The effective income tax rate for the thirteen weeks ended March 30, 2025, was 46.1%, significantly higher than the 28.0% for the same period in 2024[62] - Stock-based compensation expense for the thirteen weeks ended March 30, 2025, was $2.3 million, compared to $1.9 million for the same period in 2024[60] Assets and Liabilities - Total assets increased to $1.54 billion as of March 30, 2025, compared to $1.51 billion at the end of December 2024, representing a growth of 2.5%[11] - Total liabilities rose to $947.85 million, up from $918.97 million, marking an increase of 3.2%[11] - Cash and cash equivalents decreased to $18.61 million from $33.31 million, a decline of 44.6%[11] - The total accounts receivable decreased to $5.96 million from $7.24 million at the end of the previous year[34] - As of March 30, 2025, the total net long-term debt was $191.5 million, an increase from $189.0 million as of December 29, 2024[36] - The estimated fair value of the outstanding debt as of March 30, 2025, was $201.8 million, compared to $198.3 million as of December 29, 2024[41] Capital Expenditures and Investments - Capital expenditures for the period were $36.56 million, compared to $28.58 million in the prior year, indicating an increase of 28%[18] - The Company drew $7.0 million and $20.5 million from the Delayed Draw Term Facility on April 11 and April 25, 2025, respectively, to fund acquisitions[40] - The company acquired 16 restaurants for approximately $49.0 million and three restaurants for approximately $7.0 million in April 2025[71] Operational Metrics - The company operated 498 company-owned restaurants and 86 franchise-owned restaurants as of March 30, 2025[24] - In-restaurant dining sales reached $226.73 million, a rise of 16.2% compared to $195.20 million in the prior year[33] - The total lease expense for the thirteen weeks ended March 30, 2025, was $25.1 million, compared to $20.4 million for the same period in 2024[50] Debt and Interest Management - Cash paid for interest was $3.07 million, up from $2.77 million in the previous year[20] - The Company has a $100.0 million Term Facility, a $125.0 million Revolving Credit Facility, and a $125.0 million Delayed Draw Term Facility under its Credit Facility[37] - The Company utilized interest rate swaps with an aggregate notional amount of $150.0 million to hedge cash flows of variable rate debt[45][46] - The company entered into variable-to-fixed interest rate swap agreements to hedge $150.0 million of outstanding variable rate debt, with fixed rates of 4.16% and 4.42%[154] Shareholder Information - The weighted average number of common shares outstanding increased to 60.77 million from 60.01 million, reflecting a rise of 1.3%[13] - The weighted average common shares outstanding for basic net loss per share was 60,767,401 for the thirteen weeks ended March 30, 2025[70] Compliance and Valuation - The Company was in compliance with all covenants under the credit agreement as of March 30, 2025[43] - The company has established a valuation allowance on deferred tax assets deemed not realizable as of March 30, 2025, due to insufficient earnings history[64] - The company continues to assess the need for a valuation allowance for deferred tax assets, which may change with future taxable earnings[65] - Unrecognized stock-based compensation expense as of March 30, 2025, included $19,000 for stock options and $18.634 million for restricted stock units[61] Deferred Revenue - Deferred gift card revenue at the end of the period was $3.15 million, down from $5.39 million at the beginning of the period[33]

[Financial & Operational Highlights](index=1&type=section&id=Highlights) In Q1 2025, First Watch achieved a 16.4% increase in total revenues to $282.2 million, though profitability declined with a net loss of $(0.8) million and Adjusted EBITDA decreasing to $22.8 million Q1 2025 Key Financial Metrics (vs. Q1 2024) | Metric | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | Total Revenues | $282.2M | $242.4M | +16.4% | | System-wide Sales | $323.0M | $289.6M | +11.5% | | Same-Restaurant Sales Growth | 0.7% | N/A | - | | Same-Restaurant Traffic Growth | -0.7% | N/A | - | | Income from Operations Margin | 0.4% | 5.1% | -4.7 p.p. | | Restaurant Level Operating Profit Margin* | 16.5% | 20.8% | -4.3 p.p. | | Net (Loss) Income | $(0.8)M | $7.2M | -111.1% | | Diluted EPS | $(0.01) | $0.12 | -108.3% | | Adjusted EBITDA* | $22.8M | $28.6M | -20.3% | - The company opened **13 new system-wide restaurants** and had **1 closure**, bringing the total to **584 restaurants** (**498 company-owned**, **86 franchise-owned**) across **30 states**[6](index=6&type=chunk) - CEO Chris Tomasso noted that Q1 same-restaurant traffic results were encouraging and continued positive trends from late 2024, with new restaurant openings in 2024 and 2025 exceeding expectations[3](index=3&type=chunk) [Fiscal Year 2025 Outlook](index=2&type=section&id=Updated%20Outlook%20Fiscal%20Year%202025) The company updated its full-year 2025 guidance, projecting total revenue growth of approximately 20% and an Adjusted EBITDA between $114.0 million and $119.0 million, alongside plans to open 59 to 64 new system-wide restaurants Updated Fiscal Year 2025 Guidance | Metric | Guidance Range/Value | | :--- | :--- | | Total Revenue Growth | ~20.0% (includes ~4% from acquisitions) | | Same-Restaurant Sales Growth | Positive low-single digits | | Same-Restaurant Traffic Growth | Flat-to-slightly positive | | Adjusted EBITDA | $114.0M - $119.0M | | New System-Wide Restaurants | 59 to 64 (net of 3 closures) | | Capital Expenditures | $150.0M - $160.0M | | Blended Tax Rate | 45.0% - 50.0% | [Financial Statements and Reconciliations](index=5&type=section&id=Financial%20Statements%20and%20Reconciliations) This section provides detailed financial statements and non-GAAP reconciliations, highlighting a year-over-year revenue increase but a decline into a net loss due to rising operating costs, and a decrease in key non-GAAP metrics [Consolidated Statements of Operations and Comprehensive Income (Loss)](index=8&type=section&id=CONSOLIDATED%20STATEMENTS%20OF%20OPERATIONS%20AND%20COMPREHENSIVE%20INCOME%20%28LOSS%29) For Q1 2025, total revenues grew to $282.2 million, but significant increases in operating expenses, particularly food and beverage and labor costs, led to a net loss of $(0.8) million, a stark contrast to the prior-year's net income Consolidated Statement of Operations Highlights (in thousands) | Account | Q1 2025 (ended Mar 30) | Q1 2024 (ended Mar 31) | | :--- | :--- | :--- | | **Total Revenues** | **$282,240** | **$242,449** | | Food and beverage costs | $66,647 | $52,184 | | Labor and other related expenses | $96,754 | $79,735 | | Total operating costs and expenses | $281,127 | $230,163 | | **Income from operations** | **$1,113** | **$12,286** | | **Net (loss) income** | **$(829)** | **$7,214** | | Net (loss) income per share - diluted | $(0.01) | $0.12 | [Non-GAAP Financial Measures Reconciliations](index=6&type=section&id=Non-GAAP%20Financial%20Measures%20Reconciliations) This section details the reconciliation of GAAP measures to the company's preferred non-GAAP metrics, showing that Adjusted EBITDA for Q1 2025 was $22.8 million, down from $28.6 million, and Restaurant Level Operating Profit fell to $46.1 million from $49.9 million Reconciliation of Net (Loss) Income to Adjusted EBITDA (in thousands) | Line Item | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net (loss) income | $(829) | $7,214 | | Depreciation and amortization | 16,557 | 12,271 | | Interest expense | 3,334 | 2,599 | | Income tax (benefit) expense | (708) | 2,799 | | Other adjustments (Stock-based comp, etc.) | 4,399 | 3,382 | | **Adjusted EBITDA** | **$22,753** | **$28,590** | | **Adjusted EBITDA margin** | **8.1%** | **11.8%** | Reconciliation of Income from Operations to Restaurant Level Operating Profit (in thousands) | Line Item | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Income from operations | $1,113 | $12,286 | | Less: Franchise revenues | (2,649) | (3,141) | | Add: General and administrative expenses | 30,219 | 27,658 | | Add: Depreciation and amortization | 16,557 | 12,271 | | Add: Other adjustments | 882 | 788 | | **Restaurant level operating profit** | **$46,122** | **$49,862** | | **Restaurant level operating profit margin** | **16.5%** | **20.8%** | [Supplementary Information](index=3&type=section&id=Supplementary%20Information) This section provides context for the financial report, including definitions of key operational and non-GAAP metrics, a standard forward-looking statements disclaimer outlining potential business risks, and a corporate overview describing First Watch's market position [Definitions of Key Metrics](index=3&type=section&id=Definitions) The report defines key terms for clarity, including 'Same-restaurant sales growth' for year-over-year sales changes and non-GAAP measures like 'Adjusted EBITDA' and 'Restaurant level operating profit' which exclude specific corporate-level expenses - **Same-restaurant sales growth:** Defined as the percentage change in year-over-year sales for company-owned restaurants open for **18 months or longer**, based on **383 restaurants** for Q1 2025[13](index=13&type=chunk) - **Adjusted EBITDA:** A non-GAAP measure defined as net income (loss) before depreciation and amortization, interest expense, income taxes, and other items not considered part of ongoing core operating performance[15](index=15&type=chunk) - **Restaurant level operating profit:** A non-GAAP measure defined as restaurant sales less direct restaurant operating expenses (e.g., food, labor, occupancy), excluding corporate-level expenses[17](index=17&type=chunk) [Forward-Looking Statements](index=4&type=section&id=Forward-Looking%20Statements) This section serves as a legal safe harbor, cautioning that the report's projections are subject to significant risks and uncertainties, including changes in consumer preferences, economic conditions, and operational challenges - The press release contains forward-looking statements that are not guarantees of future performance and are subject to risks and uncertainties[20](index=20&type=chunk) - Important risk factors include: changes in consumer preferences and economic conditions (inflation, recession), challenges in opening new restaurants, supply chain disruptions, competition, and labor shortages[20](index=20&type=chunk) [About First Watch](index=3&type=section&id=About%20First%20Watch) First Watch is a leading 'Daytime Dining' restaurant concept focused on made-to-order breakfast, brunch, and lunch, operating over 580 restaurants in 31 states and recognized for its fresh ingredients and workplace culture - First Watch is positioned as the leading Daytime Dining concept serving made-to-order breakfast, brunch, and lunch with fresh ingredients[19](index=19&type=chunk) - The company operates more than **580 restaurants** in **31 states**[19](index=19&type=chunk) - Recent awards include being named **2024's 1 Most Loved Workplace® in America** by Newsweek and the **top restaurant brand in Yelp's 2023 list of most-loved brands**[19](index=19&type=chunk)

Core Viewpoint - First Watch Restaurant Group, Inc. has completed the acquisition of 16 franchise-owned restaurants in North Carolina and South Carolina for $49 million, marking the second largest franchisee deal in its history and emphasizing its long-term growth strategy [1][2]. Acquisition Details - The acquisition includes 16 locations in the Charlotte and Concord DMAs in North Carolina, and the Columbia and Greenville DMAs in South Carolina [2]. - This deal is part of First Watch's strategy to solidify corporate ownership along the East Coast and to provide additional territories for organic growth [2]. - Since May 2023, First Watch has acquired a total of 64 franchised restaurants across eight acquisitions [3]. Company Overview - First Watch is recognized for its Daytime Dining concept, serving made-to-order breakfast, brunch, and lunch with fresh ingredients [4]. - The company operates over 570 restaurants across 30 states and has received numerous accolades, including being named the 1 Most Loved Workplace in America for 2024 [4].

Core Insights - First Watch Restaurant Group, Inc. is expanding its presence in New England with the opening of its first downtown Boston location at 777 Boylston St. in late 2025, following its earlier entry into Massachusetts with a location in Hanover [1][8] - The new restaurant will feature a chef-driven menu that emphasizes fresh, high-quality ingredients and a commitment to socially responsible sourcing, including coffee from women-owned farms [2][3] - The Boston location will create approximately 30 new jobs and uphold a "No Night Shifts Ever" policy to prioritize employee wellbeing [5] Company Overview - First Watch is recognized as a leading daytime dining concept, serving made-to-order breakfast, brunch, and lunch with a rotating seasonal menu [7] - The company has received numerous accolades, including being named the "1 Most Loved Workplace in America" by Newsweek and the Best Practice Institute [7] - First Watch operates over 570 restaurants across 30 states, showcasing a diverse menu that includes breakfast classics and innovative dishes [7]

First Watch Restaurant Group, Inc. (FWRG) acquired three franchise-owned restaurants in Missouri, along with the development rights for the area. The move is expected to support the company’s growth strategy through increased control over operations and future expansion.The company will share more details about the transaction when it announces results for the fiscal first quarter ended March 30, 2025.FWRG Bolsters Portfolio With Latest AcquisitionsThe company added Lee’s Summit, West Columbia and South Col ...

Latest Franchisee Deal Underscores Long-term Growth StrategyBRADENTON, Fla., April 14, 2025 (GLOBE NEWSWIRE) -- First Watch Restaurant Group, Inc. (NASDAQ: FWRG) (together with its subsidiaries “First Watch” or the “Company”), the leading Daytime Dining concept serving breakfast, brunch and lunch, today announced the acquisition of three of its franchise-owned restaurants and corresponding development rights in Missouri. "We’re proud to welcome the Lee’s Summit, West Columbia and South Columbia restaurant t ...

First Watch Restaurant Group TodayFWRGFirst Watch Restaurant Group$18.42 +0.51 (+2.85%) 52-Week Range$12.90▼$25.98P/E Ratio55.82Price Target$22.45Add to WatchlistFirst Watch Restaurant Group NASDAQ: FWRG is a first-rate small-cap growth stock on track to triple in size over the next ten years. The company stands out among restaurants in the sit-down breakfast category, serving above-average-quality traditional breakfast alongside an eclectic menu of appetizing choices. Customer favorites include the biscui ...