FAT Brands(FATBB) - 2025 Q1 - Quarterly Results

Management Commentary & Strategic Outlook Management emphasizes strong new store openings, strategic refranchising, international expansion, and a $50 million dividend from the Twin Hospitality Group spin-off - Opened 23 new locations in Q1 2025, a 37% increase YoY, and on track to open over 100 new restaurants in 2025[5] - Development pipeline includes approximately 1,000 signed agreements for future restaurant openings[5] - Secured new agreements to open 40 locations in France, featuring Fatburger and Buffalo's Cafe concepts[5] - The spin-off of Twin Hospitality Group resulted in a $50 million dividend to shareholders through a stock distribution[5] - Strategy to return to a nearly 100% franchised model is advancing with the planned refranchising of 57 company-operated Fazoli's restaurants[5] Q1 2025 Financial Highlights Q1 2025 financial performance declined, with total revenue down 6.5% to $142.0 million and a net loss of $46.0 million Q1 2025 Key Financial Metrics vs. Q1 2024 (in millions) | Metric | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | Total Revenue | $142.0 million | $152.0 million | -6.5% | | System-wide Sales | - | - | -1.8% | | System-wide Same-Store Sales | - | - | -3.4% | | Net Loss | $46.0 million | $38.3 million | +20.1% | | Diluted Loss Per Share | $2.73 | $2.37 | +15.2% | | EBITDA | $2.1 million | $9.4 million | -77.7% | | Adjusted EBITDA | $11.1 million | $18.2 million | -39.0% | - The company opened 23 new stores during the first quarter of 2025[6] Detailed Financial Performance Analysis Q1 2025 total revenue decreased to $142.0 million, while general and administrative expenses increased to $33.0 million due to higher professional fees - Total revenue decreased by 6.5% to $142.0 million, driven by lower same-store sales and the closure of one Smokey Bones location for conversion, partially offset by new Twin Peaks revenues[8] - Cost of restaurant and factory revenues decreased by 3.0% to $96.1 million, mainly due to lower sales, but was partially offset by labor inflation and higher food ingredient prices[9] - General and administrative expenses increased by 10.1% to $33.0 million, primarily due to higher professional fees related to pending litigation[10] - Total other expense, net, was $36.0 million, which included $35.9 million in interest expense[11] Financial Statements This section presents the unaudited consolidated financial statements for Q1 2025, including the Statement of Operations and non-GAAP reconciliations Consolidated Statements of Operations Q1 2025 total revenues were $142.0 million, with a widened loss from operations of $8.6 million and a net loss of $46.0 million Q1 2025 Statement of Operations Summary (in thousands) | Line Item | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Total Revenue | $142,019 | $151,967 | | Total Costs and Expenses | $150,585 | $153,349 | | Loss from Operations | $(8,566) | $(1,382) | | Total Other Expense, Net | $(35,976) | $(33,410) | | Net Loss Attributable to FAT Brands Inc. | $(45,969) | $(38,316) | | Basic and Diluted Loss Per Share | $(2.73) | $(2.37) | Reconciliation of Non-GAAP Measures Non-GAAP measures show a decline, with Q1 2025 Adjusted EBITDA at $11.1 million and Adjusted Net Loss at $38.7 million EBITDA and Adjusted EBITDA Reconciliation (in thousands) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net Loss Attributable to FAT Brands Inc. | $(45,969) | $(38,316) | | EBITDA | $2,053 | $9,443 | | Litigation Costs Adjustment | $6,864 | $3,807 | | Adjusted EBITDA | $11,069 | $18,207 | Adjusted Net Loss Reconciliation (in thousands, except per share data) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net Loss Attributable to FAT Brands Inc. | $(45,969) | $(38,316) | | Adjusted Net Loss | $(38,698) | $(32,909) | | Adjusted Net Loss Per Share | $(2.32) | $(2.05) | About FAT Brands & Forward-Looking Statements FAT Brands is a global franchising company with 18 brands and 2,300 units, and the report contains forward-looking statements subject to inherent risks - The company owns 18 restaurant brands and franchises/owns approximately 2,300 units worldwide[16] - The press release includes forward-looking statements subject to risks and uncertainties, and the company undertakes no obligation to update them[17]