Biglari (US:BH)2025-11-07 21:04Financial Performance - Net earnings for the third quarter of 2025 were $(5,291) thousand, compared to $32,125 thousand in the same period of 2024, reflecting a significant decline [116]. - Total revenue for the third quarter of 2025 was $71,741 thousand, an increase of 15.0% from $62,384 thousand in the third quarter of 2024 [120]. - Net sales for the first nine months of 2025 reached $135,935 thousand, representing a 14.0% increase compared to $119,210 thousand in the first nine months of 2024 [121]. Costs and Expenses - The cost of food at company-operated units was $14,849 thousand or 31.3% of net sales in the third quarter of 2025, compared to $12,218 thousand or 30.8% in the same quarter of 2024 [126]. - Labor costs at company-operated restaurants decreased to $14,573 thousand or 30.7% of net sales in the third quarter of 2025, down from $13,158 thousand or 33.2% in the same period of 2024 [127]. - General and administrative expenses for the third quarter of 2025 were $12,129 thousand, representing 16.9% of total revenue, compared to $10,355 thousand or 16.6% in the third quarter of 2024 [128]. - Marketing expenses increased to $5,370 thousand or 7.5% of total revenue in the third quarter of 2025, compared to $3,182 thousand or 5.1% in the same quarter of 2024, due to promotions of new products [129]. Operational Changes - The company operated 441 restaurants as of September 30, 2025, down from 492 restaurants at the end of 2024, indicating a reduction in total store count [117]. - Steak n Shake plans to sell or lease eight of the ten closed locations, with two locations expected to reopen [117]. Underwriting and Premiums - In Q3 2025, the net underwriting gain was $3,584 million, up from $1,800 million in Q3 2024, representing a 99.8% increase [136]. - Premiums written in the first nine months of 2025 reached $53,969 million, a 7.8% increase from $50,265 million in the same period of 2024 [138]. - First Guard's underwriting gain for the first nine months of 2025 was $4,997 million, an increase of $1,500 million compared to $3,497 million in 2024 [140]. - Southern Pioneer reported a 21.9% increase in premiums earned, rising to $25,220 million in the first nine months of 2025 from $20,690 million in 2024 [142]. Income and Revenue Changes - Total other income for the first nine months of 2025 was $2,093 million, down from $3,536 million in 2024 [138]. - Oil and gas revenues for the first nine months of 2025 were $24,800 million, a decrease of 10.5% from $27,755 million in 2024 [146]. - Abraxas Petroleum's oil and gas revenues decreased by $2,552 million in the first nine months of 2025 compared to 2024, primarily due to lower sales prices [148]. - Southern Oil's contribution to net earnings for the first nine months of 2025 was $1,683 million, compared to $102 million in 2024, indicating significant growth [151]. - The pre-tax investment income for the first nine months of 2025 was $2,500 million, down from $2,686 million in 2024 [144]. Cash Flow and Financing - Total cash and investments as of September 30, 2025, amounted to $1,117,184 million, an increase from $789,950 million as of December 31, 2024 [164]. - Net cash provided by operating activities for the first nine months of 2025 was $89,188 million, a significant increase of $57,523 million compared to $31,665 million in 2024 [166]. - Cash provided by financing activities increased to $188,722 million in the first nine months of 2025, compared to $4,869 million in the same period of 2024, primarily due to a note payable of $225,000 million [167]. - The line of credit was amended to $35,000 million as of September 30, 2025, with a balance of $15,000 million, down from $35,000 million at the end of 2024 [168]. - Steak n Shake obtained a loan of $225,000 million on September 30, 2025, with a fixed interest rate of 8.8% per annum [170]. Taxation - Income tax benefit for Q3 2025 was $2,261 million, compared to an expense of $11,201 million in Q3 2024, while the income tax expense for the first nine months of 2025 was $4,002 million, up from $3,292 million in the same period of 2024 [162]. Investment Gains - Investment gains net of tax for Q3 2025 were $1,184 million, down from $3,706 million in Q3 2024, and for the first nine months of 2025, they totaled $2,214 million compared to $2,879 million in the same period of 2024 [154]. - Interest expense on notes payable for Q3 2025 was $829 million, significantly higher than $275 million in Q3 2024, with a net interest expense after tax of $634 million compared to $210 million in Q3 2024 [160]. - Corporate and other net losses for Q3 2025 were $3,775 million, a decrease from $5,548 million in Q3 2024, primarily due to no accrued incentive fees in 2025 [161].