Financial Data and Key Metrics Changes - System-wide sales increased by 5.1% to $146.2 million, driven by new company-owned restaurants despite a challenging sales environment [8][20] - Total revenue decreased by 5.4% to $87.1 million compared to $92.1 million in the previous year [20] - Net loss for the quarter was $12.1 million, compared to a loss of $9.2 million in the prior year [27] Business Line Data and Key Metrics Changes - Twin Peaks revenue was $51 million, up 5.9% from $48.1 million in the prior year, driven by new lodge openings [20][21] - Smoky Bones revenue decreased by 17.8% to $36.1 million, down from $43.9 million, due to ongoing conversions to Twin Peaks lodges [21] - Restaurant level contribution margin for Twin Peaks decreased to 16.9% from 17.4% in the previous year [25] Market Data and Key Metrics Changes - Same store sales decreased by 1.5%, with a 2.7% decline at company-owned locations and a 1% decline at franchise locations [9] - Alcohol sales comprised nearly 50% of restaurant revenue, significantly higher than typical casual dining competitors [13] Company Strategy and Development Direction - The company plans to open three to four new units in 2025, building on a robust development pipeline of 100 units [7][12] - A strategic five-unit development deal was initiated to enter untapped markets in South Dakota and Montana [12] - The focus on high-margin beverage sales and local community engagement through grassroots marketing is expected to drive traffic [13][15] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the impact of weather and macroeconomic factors on sales but expressed optimism about upcoming promotional events and major sporting events [9][10] - The company is confident in achieving its full annual equity target raise over the next twelve months despite current market volatility [27][28] Other Important Information - Twin Peaks was awarded the Black Box Intelligence 2025 Voice of the Customer Award, highlighting strong brand loyalty and customer experience [17][18] - The company is enhancing its menu with new food innovations and promotions to maintain brand relevance [14][19] Q&A Session Summary - No questions were taken following the prepared remarks, and the call concluded without a Q&A session [3][29]

Core Insights - Twin Hospitality Group Inc. reported a 5.4% decrease in total revenue for the fiscal first quarter of 2025, amounting to $87.1 million compared to $92.1 million in the same period of 2024, primarily due to lower same-store sales and the closure of one Smokey Bones location during its conversion to a Twin Peaks lodge [6][8] - The company achieved system-wide sales growth of 5% to $146.3 million, driven by new company-owned restaurants, despite industry-wide challenges [3][8] - Twin Peaks continues to focus on high-margin beverage sales, with alcohol accounting for nearly 50% of restaurant revenue [3] Financial Performance - The company experienced a net loss of $12.1 million in Q1 2025, compared to a net loss of $9.2 million in Q1 2024 [8][26] - Adjusted EBITDA decreased to $5.1 million from $7.1 million year-over-year [8][27] - Restaurant contribution margin fell to 11.2% from 13.6% in the previous year, with Twin Peaks at 16.9% and Smokey Bones at 4.4% [8][29] Operational Highlights - Twin Peaks opened two new lodges, including a second Smokey Bones conversion in Brandon, Florida, and a franchised location in Algonquin, Illinois, bringing the total to 116 locations [3][8] - The company plans to open three to four new units this year, with a robust development pipeline consisting of 100 franchise agreements [3][8] - Labor and benefits costs decreased by 5.1% to $25.3 million, while food and beverage costs decreased by 5.2% to $21.2 million [7][9] Marketing and Advertising - Advertising expenses decreased by 14.9% to $5.1 million, primarily due to lower marketing spend for Smokey Bones [10]

[Financial & Operational Highlights](index=1&type=section&id=Financial%20%26%20Operational%20Highlights) Twin Hospitality Group reported a challenging Q1 FY2025 with total revenue decreasing 5.4% to $87.1 million and a widened net loss of $12.1 million, despite Twin Peaks' sales growth and continued expansion Q1 2025 Key Financial Metrics vs. Q1 2024 | Metric | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | Total Revenue | $87.1 million | $92.1 million | -5.4% | | System-wide Sales | - | - | -3.5% | | Twin Peaks Same-Store Sales | - | - | -1.5% | | Income (Loss) from Operations | $(1.1) million | $1.3 million | - | | Net Loss | $(12.1) million | $(9.2) million | +31.4% | | Adjusted EBITDA | $5.1 million | $7.1 million | -28.7% | | Restaurant Contribution Margin | 11.2% | 13.6% | -2.4 p.p. | - The Twin Peaks brand demonstrated strong performance with system-wide sales growing **5%** to **$146.3 million**, driven by new company-owned restaurants[3](index=3&type=chunk) - The company is actively expanding its footprint, opening **two new lodges** in Q1, including the second successful conversion of a Smokey Bones restaurant, bringing the total system to **116 locations**[1](index=1&type=chunk)[3](index=3&type=chunk) - Due to construction delays, the company has revised its full-year opening forecast to **three to four new units**, while the development pipeline remains robust with **100 franchise agreements**[3](index=3&type=chunk) [Detailed Financial Performance](index=3&type=section&id=Detailed%20Financial%20Performance) Detailed financials show a 5.4% revenue decrease to $87.1 million, with rising costs as a percentage of revenue leading to an operating loss and wider net loss [Revenues](index=5&type=section&id=Revenues) Total revenue decreased by $5.0 million to $87.1 million in Q1 2025, primarily due to lower same-store sales and a temporary restaurant closure Revenue Breakdown (in thousands) | Revenue Source | Q1 2025 | Q1 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Restaurant sales | $78,403 | $83,289 | -5.9% | | Franchise revenue | $8,702 | $8,772 | -0.8% | | **Total revenue** | **$87,105** | **$92,061** | **-5.4%** | - The revenue decline was driven by a **1.5%** decrease in Twin Peaks same-store sales and the closure of one Smokey Bones location during its conversion[5](index=5&type=chunk)[7](index=7&type=chunk) [Costs and Expenses](index=3&type=section&id=Costs%20and%20Expenses) Costs and expenses increased as a percentage of revenue, with food and labor costs rising, while advertising expenses decreased due to reduced marketing for Smokey Bones Key Restaurant Operating Costs as a % of Restaurant Sales | Cost Category | Q1 2025 (%) | Q1 2024 (%) | | :--- | :--- | :--- | | Food and beverage costs | 27.1% | 26.9% | | Labor and benefits cost | 32.2% | 31.9% | - Advertising expenses decreased by **$0.9 million** (**14.9%**) to **$5.1 million**, mainly due to reduced marketing for the Smokey Bones brand[10](index=10&type=chunk) - Total other expense, primarily interest expense, remained high at **$10.8 million** for the quarter[11](index=11&type=chunk) [Profitability](index=5&type=section&id=Profitability) Profitability declined significantly in Q1 2025, with an operating loss of $1.1 million, a wider net loss of $12.1 million, and a 28.7% drop in Adjusted EBITDA Profitability Comparison (in thousands) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Income (loss) from operations | $(1,056) | $1,334 | | Net loss | $(12,112) | $(9,221) | | Adjusted EBITDA | $5,069 | $7,113 | - The restaurant contribution margin for the Twin Peaks brand was **16.9%**, significantly higher than the Smokey Bones brand at **4.4%**[7](index=7&type=chunk) [Appendix: Non-GAAP Reconciliations & Definitions](index=3&type=section&id=Appendix%3A%20Non-GAAP%20Reconciliations%20%26%20Definitions) This appendix defines key performance indicators and provides reconciliations for non-GAAP financial measures like EBITDA, Adjusted EBITDA, and Restaurant-Level Contribution [Key Financial Definitions](index=3&type=section&id=Key%20Financial%20Definitions) This section defines key financial metrics, including same-store sales growth for stores open at least 18 months and system-wide sales growth for all stores - Same-store sales growth is calculated for stores open for at least eighteen months[13](index=13&type=chunk) - System-wide sales growth includes sales from all stores in the system for a given period compared to the prior period[14](index=14&type=chunk) [Non-GAAP Measures and Reconciliations](index=4&type=section&id=Non-GAAP%20Measures%20and%20Reconciliations) The company uses non-GAAP measures like Adjusted EBITDA ($5.1 million) and Restaurant-Level Contribution ($8.7 million, 11.2% margin), with detailed reconciliations provided Adjusted EBITDA Reconciliation (in thousands) | Line Item | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net loss | $(12,112) | $(9,221) | | Interest expense, net | $10,822 | $10,408 | | Income tax provision | $265 | $79 | | Depreciation and amortization | $6,094 | $5,746 | | **EBITDA** | **$5,069** | **$7,012** | | Equity based compensation | $0 | $101 | | **Adjusted EBITDA** | **$5,069** | **$7,113** | Restaurant-Level Contribution Reconciliation (in thousands) | Line Item | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Income (loss) from operations | $(1,056) | $1,334 | | *Plus/Less Adjustments* | ... | ... | | **Restaurant-level contribution** | **$8,745** | **$11,296** | | Company-owned restaurant sales | $78,403 | $83,289 | | **Restaurant-Level Contribution Margin** | **11.2%** | **13.6%** |

Group 1 - Twin Hospitality Group Inc. will host a conference call to review its first quarter 2025 financial results on May 8, 2025, at 6:00 PM ET [1] - A press release with the financial results will be issued prior to the conference call [1] - The call will be hosted by Ken Kuick, Interim Chief Executive Officer and Chief Financial Officer [2] Group 2 - The conference call can be accessed live via phone or webcast, with a replay available after the call [2][3] - Twin Hospitality operates the Twin Peaks and Smokey Bones restaurant brands, focusing on redefining the casual dining category [4] - Twin Peaks has approximately 116 locations across 27 states and Mexico, known for its made-from-scratch food and sports bar atmosphere [4]

Financial Data and Key Metrics Changes - Total revenue for Q4 2024 decreased by 8.4% to $145.3 million compared to $158.6 million in Q4 2023, primarily due to one less operating week in the current quarter [15][43] - System-wide sales were $580.2 million for the quarter, representing a 7.4% decrease from the previous year, again impacted by the fewer operating weeks [15][43] - The net loss for Q4 2024 was $67.4 million, or $4.06 per diluted share, compared to a net loss of $26.2 million, or $1.68 per share in the prior year [47] - Adjusted EBITDA for the quarter was $14.4 million, down from $27 million in the year-ago quarter [48] Business Line Data and Key Metrics Changes - The company opened 92 new restaurants in 2024 and plans to open over 100 in 2025, with 17 units already opened year-to-date [18][19] - The company is focusing on organic growth across its existing brand portfolio, with a pipeline of over 1,000 additional locations signed [20] - Co-branding initiatives have been successful, with Great American Cookies and Marble Slab Creamery growing to over 160 co-branded locations since 2014 [21] Market Data and Key Metrics Changes - International locations for Johnny Rockets now represent over 55% of the brand's global footprint, with 11 new international locations opened in 2024 [23] - The company continues to expand in key international markets, with over 40 locations in Brazil and nearly 25 in Mexico [23] Company Strategy and Development Direction - The company is focused on three core strategic initiatives: generating organic growth, evaluating strategic acquisitions, and expanding manufacturing capabilities [17] - The spin-off of Twin Hospitality Group is seen as a major milestone, enhancing transparency and providing additional growth opportunities for shareholders [7][8] - The company aims to reduce debt by $75 million or more in 2025, with a commitment to not pay a FAT common dividend until a minimum of $25 million is paid [11] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about 2025, highlighting strong consumer demand and a robust development pipeline [20][38] - The company noted challenges in the QSR sector, particularly with Fazoli's, but also mentioned positive trends in other brands like Round Table Pizza [75] - Management is focused on deleveraging the balance sheet while executing on organic growth opportunities [38][80] Other Important Information - The company recognized a non-cash goodwill and other intangible asset impairment of $30.6 million in Q4 2024 due to declining restaurant performance [46] - The FAT Brands Foundation increased its giving by 36% in 2024, providing approximately $325,000 in grants [34] Q&A Session Summary Question: Regarding the Smokey Bones impairment loss - Management confirmed that the operating loss from closed restaurants affected results, quantified at about $2.6 million for the full year [50][53] Question: Update on litigation costs - Management expressed hope that most litigation would be resolved in the current year, potentially reducing future legal expenses [54][56] Question: Liquidity status - Management reported approximately $150 million in available-for-sale securities and an ATM on file for liquidity needs [58][59] Question: Performance of different brands - Management noted that Fazoli's faced challenges, while Round Table Pizza and cookie brands showed positive performance [75] Question: M&A pipeline post-election - Management indicated ongoing interest in strategic acquisitions but emphasized a focus on deleveraging rather than increasing leverage [78][80]

PART I [Business](index=5&type=section&id=Item%201.%20Business) The company operates and franchises Twin Peaks and Smokey Bones restaurants, with a key strategy of converting Smokey Bones locations to accelerate growth Restaurant Footprint and Sales (as of Dec 29, 2024) | Category | Count / Amount | | :--- | :--- | | **Total Restaurants** | **170** | | - Domestic Franchised Twin Peaks | 74 | | - International Franchised Twin Peaks | 7 | | - Domestic Company-Owned Twin Peaks | 34 | | - Domestic Company-Owned Smokey Bones | 55 | | **System-Wide Sales (Fiscal 2024)** | **$731.6 million** | | - Twin Peaks Sales | $573.4 million | | - Smokey Bones Sales | $158.2 million | - The company has a significant growth pipeline with **over 100 signed agreements** for new franchised units as of December 29, 2024[17](index=17&type=chunk) - A core growth strategy is the **conversion of about half of the 60 acquired Smokey Bones restaurants** into new Twin Peaks locations, expected to be faster and cheaper than new builds[23](index=23&type=chunk)[24](index=24&type=chunk) [Our Concepts](index=5&type=section&id=Our%20Concepts) The company operates two distinct restaurant concepts: the sports lodge-themed Twin Peaks and the meat-centric Smokey Bones - Twin Peaks utilizes a **"barbell" pricing model**, offering both entry-level and premium options to appeal to a wide range of guest preferences and budgets[19](index=19&type=chunk)[27](index=27&type=chunk) - Smokey Bones is a full-service restaurant concept focused on **fire-grilled and house-smoked meats**, offering dine-in, pick-up, delivery, and catering services[20](index=20&type=chunk)[21](index=21&type=chunk) [Our Competitive Strengths](index=6&type=section&id=Our%20Competitive%20Strengths) Key strengths include the differentiated Twin Peaks brand, an asset-light franchise model, and attractive unit economics - Twin Peaks achieves industry-leading guest satisfaction, with **intent-to-return scores of 95%**, higher than the casual dining segment average[26](index=26&type=chunk) - The company targets a **three-year payback period** for its Twin Peaks restaurants, an attractive investment opportunity for franchisees[35](index=35&type=chunk) - A significant portion of Twin Peaks restaurants (**79.1%**) were successfully converted from existing buildings, demonstrating a key real estate strategy[37](index=37&type=chunk) [Our Growth Strategy](index=8&type=section&id=Our%20Growth%20Strategy) The growth strategy focuses on expanding the Twin Peaks brand through franchising, driving comparable sales, and exploring acquisitions - The company sees long-term potential for **over 650 Twin Peaks restaurants in the U.S.** and 250 internationally[39](index=39&type=chunk) - As of December 29, 2024, there is a domestic development pipeline of **over 100 commitments** for new franchised Twin Peaks restaurants[40](index=40&type=chunk) - The Twin Peaks National Marketing Fund, funded by a 2.5% gross sales contribution, collected **over $13.4 million in 2024** to drive brand awareness[45](index=45&type=chunk)[47](index=47&type=chunk) [Human Capital and Technology](index=14&type=section&id=Human%20Capital%20and%20Technology) The company fosters a culture to attract and retain talent while leveraging a standardized technology stack for operational efficiency - As of December 29, 2024, the company had approximately **5,300 employees**, with the majority working in its restaurant locations[83](index=83&type=chunk) - The company utilizes a standardized technology stack across its restaurants, including the **NCR Aloha POS system** and various business intelligence systems[84](index=84&type=chunk) [Government Regulation](index=17&type=section&id=Government%20Regulation) The business is subject to extensive regulations covering franchising, alcoholic beverage sales, food safety, and employment practices - Franchising activities are subject to **FTC rules and state laws** that regulate the offer and sale of franchises[99](index=99&type=chunk) - The company is subject to **"dram shop" statutes**, which can impose liability for serving intoxicated individuals[103](index=103&type=chunk) - The company must comply with the PPACA, which requires chain restaurants to **publish calorie information** on menus[104](index=104&type=chunk) [Risk Factors](index=19&type=section&id=Item%201A.%20Risk%20Factors) The company faces operational, financial, and regulatory risks, including reliance on franchisees, substantial debt, and concentrated voting control - A significant risk is the **reliance on franchisees**, as a substantial portion of revenue comes from royalties and is tied to their performance[120](index=120&type=chunk)[121](index=121&type=chunk) - The company has **significant outstanding indebtedness** under the Twin Securitization Notes, exposing it to default risk[115](index=115&type=chunk)[184](index=184&type=chunk) - A dual-class stock structure concentrates approximately **98.6% of the total voting power with FAT Brands**, limiting other stockholder influence[115](index=115&type=chunk)[218](index=218&type=chunk)[219](index=219&type=chunk) - The historical franchise commitment-to-opening conversion rate for Twin Peaks has been approximately **66% over the past five years**[138](index=138&type=chunk) [Unresolved Staff Comments](index=51&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) The company reports no unresolved staff comments from the SEC - None[288](index=288&type=chunk) [Cybersecurity](index=51&type=section&id=Item%201C.%20Cybersecurity) A dedicated team manages a cybersecurity program overseen by the Board of Directors, with no material incidents reported to date - The **Board of Directors oversees** the company's cybersecurity strategy and risk assessment, with the VP of Information Technology leading execution[294](index=294&type=chunk) - The risk management process includes identifying critical systems, network segmentation, access controls, and **regular third-party assessments**[290](index=290&type=chunk)[292](index=292&type=chunk)[295](index=295&type=chunk) - As of the report date, the company is not aware of any cybersecurity threats that have **materially affected** or are reasonably likely to materially affect its business[293](index=293&type=chunk) [Properties](index=53&type=section&id=Item%202.%20Properties) The company operates its corporate headquarters and all company-owned restaurants from leased facilities across the United States - The company operates **34 company-owned Twin Peaks** restaurants in eight states and **55 company-owned Smokey Bones** restaurants in 16 states[297](index=297&type=chunk)[298](index=298&type=chunk) - All company-owned restaurants and the corporate headquarters are located in **leased facilities**[296](index=296&type=chunk)[297](index=297&type=chunk)[298](index=298&type=chunk) [Legal Proceedings](index=53&type=section&id=Item%203.%20Legal%20Proceedings) The company is involved in ordinary course legal actions, none of which are expected to have a material adverse effect - The company is subject to ordinary course litigation but does not expect the outcome to have a **material adverse effect** on its financials[300](index=300&type=chunk) [Mine Safety Disclosures](index=53&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - Not applicable[301](index=301&type=chunk) PART II [Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=54&type=section&id=Item%205.%20Market%20for%20Registrant's%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) The company's Class A stock trades on Nasdaq, while it does not anticipate paying dividends in the foreseeable future - Class A Common Stock trades on Nasdaq under the symbol **"TWNP"**; Class B Common Stock is not publicly traded[304](index=304&type=chunk) - The company **does not expect to pay dividends** in the foreseeable future, retaining funds for growth and debt repayment[306](index=306&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=54&type=section&id=Item%207.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Revenue grew 53.2% in fiscal 2024 driven by the Smokey Bones acquisition, but higher costs and interest expense led to a wider net loss Fiscal Year 2024 vs. 2023 Financial Highlights | Metric | FY 2024 ($ in millions) | FY 2023 ($ in millions) | Change | | :--- | :--- | :--- | :--- | | **Total Revenue** | **$353.8** | **$230.9** | **+53.2%** | | - Company-owned Restaurant Sales | $320.2 | $199.4 | +60.6% | | - Franchise Revenue | $33.6 | $31.5 | +6.6% | | **(Loss) from Operations** | **($8.3)** | **$12.9** | **N/A** | | **Net Loss** | **($48.2)** | **($13.8)** | **+248.6%** | - The acquisition of Smokey Bones was the primary driver of revenue growth, contributing an additional **$115.5 million in revenue** for fiscal 2024[322](index=322&type=chunk) - In November 2024, the company issued **$416.7 million in new Twin Securitization Notes** to redeem prior notes, resulting in a $2.4 million loss on extinguishment of debt[344](index=344&type=chunk)[345](index=345&type=chunk) [Results of Operations](index=56&type=section&id=Results%20of%20Operations) Revenue grew 53.2% in fiscal 2024, but higher costs from the expanded restaurant portfolio led to an operating loss of $8.3 million - Company-owned restaurant sales increased by $120.8 million (60.6%), with the **Smokey Bones acquisition accounting for $115.5 million** of this increase[323](index=323&type=chunk) - General and administrative expenses increased by $14.0 million (72.6%), with the **Smokey Bones acquisition responsible for $12.1 million** of the rise[331](index=331&type=chunk) - Other expense, net, increased to $48.2 million from $27.0 million, primarily due to **higher interest expense** and a $2.4 million loss on debt extinguishment[333](index=333&type=chunk) [Liquidity and Capital Resources](index=59&type=section&id=Liquidity%20and%20Capital%20Resources) The company refinanced its debt in November 2024 and ended the year with $25.9 million in cash and restricted cash Cash Flow Summary (in millions) | Activity | FY 2024 | FY 2023 | | :--- | :--- | :--- | | Net cash (used in) provided by operating activities | $ (15.0) | $ 6.1 | | Net cash used in investing activities | $ (20.5) | $ (14.6) | | Net cash provided by financing activities | $ 37.3 | $ 15.7 | | **Net increase (decrease) in cash** | **$ 1.8** | **$ 7.2** | - In November 2024, the company issued **$416.7 million in new Twin Securitization Notes** with a weighted average interest rate of 9.50% to refinance its debt[345](index=345&type=chunk) - The company believes it will be in compliance with its debt covenants and has **sufficient cash sources** for its liquidity needs over the next twelve months[346](index=346&type=chunk) [Quantitative and Qualitative Disclosures about Market Risk](index=63&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) This item is not applicable to the company - Not applicable[369](index=369&type=chunk) [Financial Statements and Supplementary Data](index=63&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) This section refers to Item 15 of Part IV for the company's financial statements and supplementary data - The full financial statements are located in **Item 15 of Part IV**[370](index=370&type=chunk) [Changes in and Disagreements with Accountants on Accounting and Financial Disclosure](index=63&type=section&id=Item%209.%20Changes%20in%20and%20Disagreements%20with%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure) The company reports no changes in or disagreements with its accountants on accounting and financial disclosure - None[371](index=371&type=chunk) [Controls and Procedures](index=63&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management concluded its disclosure controls and procedures were effective, but an auditor attestation on internal control is not yet required - Management concluded that **disclosure controls and procedures were effective** as of December 29, 2024[372](index=372&type=chunk) - The report does not include a management assessment or auditor attestation on internal control over financial reporting, as **permitted for newly public companies**[373](index=373&type=chunk) [Other Information](index=64&type=section&id=Item%209B.%20Other%20Information) No director or officer adopted or terminated a Rule 10b5-1 trading arrangement during the fourth fiscal quarter of 2024 - No director or officer adopted or terminated a **Rule 10b5-1 trading arrangement** in Q4 2024[376](index=376&type=chunk) PART III [Directors, Executive Officers and Corporate Governance](index=65&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%20and%20Corporate%20Governance) The company is led by an experienced executive team and a board with three standing committees, with some governance overlap with FAT Brands - The executive team includes Joseph Hummel (CEO), Kenneth J. Kuick (CFO), Clay C. Mingus (CLO), and other key officers[380](index=380&type=chunk) - The Board of Directors has an **Audit Committee, a Compensation Committee, and a Nominating and Corporate Governance Committee**[398](index=398&type=chunk)[400](index=400&type=chunk)[404](index=404&type=chunk)[405](index=405&type=chunk) - There is an overlap in governance, with **two directors and the CFO also holding positions** at the parent company, FAT Brands Inc[394](index=394&type=chunk) [Executive Compensation](index=69&type=section&id=Item%2011.%20Executive%20Compensation) Named executive officer compensation consists of salary and non-equity incentives, while directors receive cash and equity awards 2024 Summary Compensation Table | Name and Principal Position | Salary ($) | Non-Equity Incentive Plan Compensation ($) | All Other Compensation ($) | Total ($) | | :--- | :--- | :--- | :--- | :--- | | Joseph Hummel, CEO | 350,000 | 350,000 | 9,903 | 709,903 | | Clay C. Mingus, CLO | 311,318 | 124,527 | 21,839 | 457,684 | | Michael Locey, CDO | 269,809 | 107,923 | 20,519 | 398,251 | - Non-employee directors are compensated with **$100,000 in cash annually** and an annual grant of stock options to acquire 10,000 shares of Class A Common Stock[416](index=416&type=chunk) - As of December 29, 2024, there were **no outstanding equity awards** for shares of Twin Hospitality Group Inc[412](index=412&type=chunk) [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=72&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters) FAT Brands Inc. is the principal stockholder, controlling 98.6% of the total voting power - FAT Brands Inc. holds 94.4% of Class A Common Stock and 100% of Class B Common Stock, controlling **98.6% of the total voting power** as of February 24, 2025[422](index=422&type=chunk) - All directors and executive officers as a group own **less than 1%** of the company's stock and voting power[422](index=422&type=chunk) - The company has two equity compensation plans with a combined total of **5,742,346 shares authorized** for issuance[425](index=425&type=chunk)[426](index=426&type=chunk) [Certain Relationships and Related Transactions, and Director Independence](index=73&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions%2C%20and%20Director%20Independence) The company has significant related party transactions with its majority stockholder, FAT Brands, governed by several key agreements - The Master Separation and Distribution Agreement grants FAT Brands **registration rights and an anti-dilution option** to maintain at least 80.1% ownership[432](index=432&type=chunk)[435](index=435&type=chunk)[438](index=438&type=chunk)[446](index=446&type=chunk) - The company and FAT Brands have **cross-indemnification agreements** allocating liabilities between the two entities[439](index=439&type=chunk) - The Tax Matters Agreement governs tax liabilities, generally requiring the company to **make tax-sharing payments to FAT Brands**[449](index=449&type=chunk)[451](index=451&type=chunk) [Principal Accountant Fees and Services](index=78&type=section&id=Item%2014.%20Principal%20Accountant%20Fees%20and%20Services) The company engaged Macias Gini & O'Connell LLP as its auditor for fiscal 2024, replacing the prior year's firm Accountant Fees (in thousands) | Fee Type | December 29, 2024 | December 31, 2023 | | :--- | :--- | :--- | | Audit fees | $120.7 | $604.0 | | Audit related fees | $0 | $319.0 | | Other fees | $0 | $0 | - The company changed its principal accountant from CohnReznick LLP (for FY 2023) to **Macias Gini & O'Connell LLP (for FY 2024)**[460](index=460&type=chunk) PART IV [Exhibits, and Financial Statement Schedules](index=79&type=section&id=Item%2015.%20Exhibits%2C%20and%20Financial%20Statement%20Schedules) This section contains the company's audited consolidated financial statements and a list of exhibits filed with the 10-K [Consolidated Financial Statements](index=80&type=section&id=Consolidated%20Financial%20Statements) The audited financial statements show a net loss of $48.2 million for fiscal 2024 on total assets of $542.4 million Consolidated Balance Sheet Highlights (in thousands) | Account | Dec 29, 2024 | Dec 31, 2023 | | :--- | :--- | :--- | | Total Assets | $542,446 | $565,582 | | Total Liabilities | $627,055 | $581,093 | | Total Stockholders' Deficit | ($84,609) | ($15,511) | Consolidated Statement of Operations Highlights (in thousands) | Account | FY 2024 | FY 2023 | | :--- | :--- | :--- | | Total Revenue | $353,801 | $230,867 | | (Loss) from Operations | ($8,330) | $12,940 | | Net Loss | ($48,170) | ($13,840) | - Subsequent to the fiscal year-end, on January 29, 2025, the company completed its **spin-off from FAT Brands** and became an independent publicly traded company[590](index=590&type=chunk)[612](index=612&type=chunk) [Form 10-K Summary](index=106&type=section&id=Item%2016.%20Form%2010-K%20Summary) This item is noted as 'None' in the report - None[614](index=614&type=chunk)

[Fiscal Fourth Quarter and Full Fiscal Year 2024 Financial Results](index=1&type=section&id=TWIN%20HOSPITALITY%20GROUP%20INC.%20REPORTS%20FISCAL%20FOURTH%20QUARTER%20AND%20FULL%20FISCAL%20YEAR%202024%20FINANCIAL%20RESULTS) Twin Hospitality Group's Q4 and FY2024 financial results detail strategic progress and financial performance [Management Commentary and Strategic Progress](index=1&type=section&id=Management%20Commentary) Management commentary highlights strategic progress in 2024, including new lodge openings, pipeline expansion, and securing a 30-year securitization facility - Opened **nine new Twin Peaks lodges** in 2024, expanding the development pipeline to **over 100 lodges**, with 9-11 new locations targeted for 2025[4](index=4&type=chunk) - Successful conversion of legacy restaurants, including Smokey Bones, into Twin Peaks lodges is underway, with two more planned for 2025[4](index=4&type=chunk) - A new **30-year securitization facility** was secured in Q4 to stabilize financial structure and support growth initiatives[4](index=4&type=chunk) [Financial Highlights](index=1&type=section&id=Financial%20Highlights) Fiscal 2024 saw significant revenue growth but increased net losses, declining same-store sales, and lower Adjusted EBITDA [Fourth Quarter 2024 Financial Highlights (vs. Q4 2023)](index=1&type=section&id=Highlights%20for%20Fiscal%20Fourth%20Quarter%202024) Q4 2024 revenue decreased by **8.2%** to **$86.5 million**, with increased net loss and declining same-store sales and Adjusted EBITDA | Metric | Q4 2024 (13 weeks) | Q4 2023 (14 weeks) | Change | | :--- | :--- | :--- | :--- | | Total Revenue ($ millions) | $86.5 | $94.2 | -8.2% | | System-wide Sales | - | - | -4.0% | | Twin Peaks Same-Store Sales | - | - | -0.6% | | Loss from Operations ($ millions) | ($7.1) | ($0.9) | Increased Loss | | Net Loss ($ millions) | ($12.0) | ($8.8) | Increased Loss | | Restaurant Contribution Margin | 8.1% | 9.8% | -1.7 p.p. | | Adjusted EBITDA ($ millions) | $4.1 | $6.6 | -38.1% | [Full Fiscal Year 2024 Financial Highlights (vs. FY 2023)](index=1&type=section&id=Highlights%20for%20Full%20Fiscal%20Year%202024) Full fiscal year 2024 revenue grew **53.2%** to **$353.8 million**, but net loss increased significantly, with declining same-store sales and Adjusted EBITDA | Metric | FY 2024 (52 weeks) | FY 2023 (53 weeks) | Change | | :--- | :--- | :--- | :--- | | Total Revenue ($ millions) | $353.8 | $230.9 | +53.2% | | System-wide Sales Growth | - | - | +25.3% | | Twin Peaks Same-Store Sales | - | - | -3.1% | | (Loss)/Income from Operations ($ millions) | ($8.3) | $12.9 | N/A | | Net Loss ($ millions) | ($48.2) | ($13.8) | Increased Loss | | Restaurant Contribution Margin | 9.2% | 13.1% | -3.9 p.p. | | Adjusted EBITDA ($ millions) | $20.7 | $28.3 | -27.1% | [Detailed Fourth Quarter 2024 Financial Analysis](index=3&type=section&id=Summary%20of%20Fourth%20Quarter%202024%20Financial%20Results) Q4 2024 revenue decreased by **$7.8 million** due to fewer operating weeks, lower sales, and conversion closures, impacting expenses and debt extinguishment - Q4 revenue decreased by **$7.8 million**, primarily due to a **$6.5 million** impact from fewer operating weeks and Smokey Bones conversions[8](index=8&type=chunk) - General and administrative expenses increased to **$12.1 million**, including **$5.0 million** in Smokey Bones store closure costs[10](index=10&type=chunk) - Other expense, net, rose to **$13.3 million**, including a **$2.4 million** loss on debt extinguishment from refinancing[11](index=11&type=chunk) [Appendix](index=3&type=section&id=Appendix) The appendix provides definitions for key financial metrics, explanations of non-GAAP measures, and detailed financial statements [Key Financial Definitions](index=3&type=section&id=Key%20Financial%20Definitions) This section defines key performance indicators including new store openings, same-store sales growth, and system-wide sales growth - **Same-store sales growth:** Change in year-over-year sales for stores open at least eighteen months[13](index=13&type=chunk) - **System-wide sales growth:** Percentage change in sales for all stores compared to the prior fiscal period[14](index=14&type=chunk) [Non-GAAP Measures](index=4&type=section&id=Non-GAAP%20Measures) Non-GAAP measures like Adjusted EBITDA and Restaurant-Level Contribution are used to evaluate core operating performance and productivity - **Adjusted EBITDA:** EBITDA excluding acquisitions, refranchising losses, impairment charges, and non-recurring items for core operations insight[22](index=22&type=chunk) - **Restaurant-Level Contribution:** Company-owned restaurant sales less direct operating costs, used to evaluate restaurant-level productivity[23](index=23&type=chunk) [Financial Statements and Reconciliations](index=6&type=section&id=Financial%20Statements%20and%20Reconciliations) This section provides detailed financial statements, including Consolidated Statements of Operations and reconciliations for non-GAAP measures | (In thousands) | Q4 2024 | Q4 2023 | FY 2024 | FY 2023 | | :--- | :--- | :--- | :--- | :--- | | **Total Revenue** | **$86,481** | **$94,235** | **$353,801** | **$230,867** | | Income (Loss) from Operations | ($7,065) | ($897) | ($8,330) | $12,940 | | **Net Loss** | **($11,993)** | **($8,768)** | **($48,170)** | **($13,840)** | | (In thousands) | Q4 2024 | Q4 2023 | FY 2024 | FY 2023 | | :--- | :--- | :--- | :--- | :--- | | Net Loss | ($11,993) | ($8,768) | ($48,170) | ($13,840) | | **Adjusted EBITDA** | **$4,094** | **$6,562** | **$20,654** | **$28,333** | | (In thousands) | Q4 2024 | Q4 2023 | FY 2024 | FY 2023 | | :--- | :--- | :--- | :--- | :--- | | Income (Loss) from Operations | ($7,065) | ($897) | ($8,330) | $12,940 | | **Restaurant-Level Contribution** | **$6,283** | **$8,356** | **$29,305** | **$26,166** | | **Restaurant-Level Contribution Margin** | **8.1%** | **9.8%** | **9.2%** | **13.1%** |