Financial Performance - Net earnings attributable to Biglari Holdings Inc. shareholders for Q3 2024 were 56,514 in Q3 2023, marking a significant recovery [100]. - Net sales for Q3 2024 were 465 or 1.2% compared to Q3 2023, driven by a 5.4% increase in same-store sales at Steak n Shake [107]. - Total revenue for Q3 2024 was 61,886 in Q3 2023, reflecting growth in both company-operated and franchise operations [106]. - Investment partnership gains for Q3 2024 were 68,377 in Q3 2023, contributing positively to overall earnings [100]. - Net sales for the third quarter of 2024 were 81,780 in 2023, while net sales for the first nine months of 2024 reached 242,741 in 2023 [118]. Cost and Expenses - Franchise partner fees decreased to 17,622 in Q3 2023, attributed to higher food and labor expenses for franchise partners [109]. - The cost of food at company-operated units was 11,888 or 30.3% in Q3 2023, indicating a slight increase in food costs [111]. - Labor costs at company-operated restaurants rose to 12,192 or 31.1% in Q3 2023, primarily due to an increase in store-level management [112]. - General and administrative expenses for Q3 2024 were 10,720 or 17.3% in Q3 2023, reflecting improved cost management [113]. - Cost of food as a percentage of net sales increased to 30.4% in Q3 2024 from 28.8% in Q3 2023, while labor costs rose to 27.2% from 26.6% [118]. Operational Metrics - The company operated 468 restaurants as of September 30, 2024, a decrease from 492 restaurants at the end of 2023, due to closures and transitions to franchise operations [102]. - The company recorded no impairment charges in Q3 2024, compared to 1,366, down from 1,800 compared to 1,817 (9.0%) in 2024 compared to 2023, with a loss ratio of 47.9% in Q3 2024 versus 60.5% in Q3 2023 [126]. - Total other income for the insurance operations was 1,155 in Q3 2023 [123]. - Net investment income for the insurance operations was 658 in Q3 2023 [128]. - Pre-tax underwriting gain for the first nine months of 2024 was 6,651 in the same period of 2023 [123]. Cash Flow and Investments - Total cash and investments as of September 30, 2024, amounted to 592,717 million at the end of 2023 [147]. - Net cash provided by operating activities for the first nine months of 2024 was 48,676 million in the same period of 2023 [149]. - Cash used in investing activities decreased by 275 million, a slight increase from 35 million as of September 13, 2024, maturing on September 13, 2026 [151]. - The balance of the line of credit was 500,000 with no debt outstanding as of September 30, 2024, and December 31, 2023 [152]. Accounting and Controls - There have been no material changes to critical accounting policies since the annual report for the year ended December 31, 2023 [153]. - No recently issued accounting pronouncements were applicable for the Quarterly Report on Form 10-Q [154]. - Disclosure controls and procedures were deemed effective as of September 30, 2024 [158]. - There were no changes in internal control over financial reporting that materially affected the company during the quarter ended September 30, 2024 [159]. - There have been no material changes in risk factors since the previous annual report for the year ended December 31, 2023 [160]. Oil and Gas Operations - Oil and gas revenues for Q3 2024 were 12,159 million in Q3 2023 [131]. - Oil and gas production costs increased to 3,771 million in Q3 2023, representing a 17.3% rise [131]. - Contribution to net earnings for Q3 2024 was 14,631 million in Q3 2023 [131]. - Abraxas Petroleum recorded a gain of 3,706 million, compared to losses of $3,710 million in Q3 2023 [138].
Biglari (BH_A) - 2024 Q3 - Quarterly Report