Red Robin Gourmet Burgers(US:RRGB)2025-11-10 21:13Financial Performance - Total revenues for the third quarter of fiscal 2025 were $265.1 million, a decrease of $9.5 million or 3.5% compared to the same period in fiscal 2024[81]. - Comparable restaurant revenue decreased by 1.2% in the third quarter, with a 3.0% decrease in guest count, partially offset by a 1.7% increase in average guest check[90]. - Net loss for the third quarter was $18.4 million, an improvement of $0.5 million compared to a net loss of $18.9 million in the prior year[81]. - Adjusted EBITDA increased by 81% to $7.6 million in the third quarter compared to $4.2 million last year[81]. - Restaurant revenue for the year-to-date period decreased by $17.6 million, or 1.9%, compared to the same period in fiscal 2024[91]. - Restaurant revenue for the twelve weeks ended October 5, 2025, was $260.9 million, a decrease of 3.6% compared to $270.6 million for the same period in 2024[120]. - Net income for the twelve weeks ended October 5, 2025, was a loss of $18.4 million, compared to a loss of $18.9 million for the same period in 2024[122]. - Adjusted net income per diluted share for the twelve weeks ended October 5, 2025, was $(0.70), an improvement from $(1.03) for the same period in 2024[122]. Revenue Sources - Franchise revenue increased by $0.3 million, or 8.6%, in the third quarter, primarily due to transfer fee revenue from a franchisee transaction[92]. - Other revenue decreased by $2.9 million year-to-date, primarily due to lower gift card breakage[93]. Operating Costs - Cost of sales as a percentage of restaurant revenue increased to 25.0% in the third quarter from 24.1% in the prior year[94]. - Cost of sales as a percentage of restaurant revenue increased by 90 basis points in Q3 FY2025 compared to Q3 FY2024, primarily due to rising commodity prices and increased discounts[95]. - Labor costs as a percentage of restaurant revenue decreased by 250 basis points in Q3 FY2025 compared to Q3 FY2024, driven by improved labor efficiency and reduced turnover[98]. - Other operating costs as a percentage of restaurant revenue increased by 40 basis points in Q3 FY2025 compared to Q3 FY2024, mainly due to higher third-party commission expenses[101]. - Occupancy costs as a percentage of restaurant revenue increased by 20 basis points in Q3 FY2025 compared to Q3 FY2024, attributed to higher general liability insurance reserves[104]. - Total restaurant operating costs decreased by 4.6% to $235.1 million for the twelve weeks ended October 5, 2025, compared to $246.4 million for the same period in 2024[120]. Cash Flow and Liquidity - Cash and cash equivalents decreased by $8.5 million to $30.9 million as of October 5, 2025, from $39.4 million at the beginning of the fiscal year[128]. - Net cash provided by operating activities increased to $26.0 million for the forty weeks ended October 5, 2025, compared to $1.8 million for the same period in 2024[130]. - Adjusted EBITDA for the forty weeks ended October 5, 2025, was $57.9 million, compared to $31.2 million for the same period in 2024[123]. - The company had approximately $50.7 million in liquidity as of October 5, 2025, including cash and cash equivalents and available borrowing capacity[128]. Capital Expenditures and Financing - Net cash flows used in investing activities decreased by $23.9 million to a negative $19.0 million for fiscal 2025, primarily due to increased capital expenditures and lower proceeds from restaurant sales[131]. - Total capital expenditures for the forty weeks ended October 5, 2025, were $25.1 million, up from $19.4 million in the comparable period of fiscal 2024, representing a 29% increase[132]. - Net cash flows used in financing activities increased to $15.6 million for fiscal 2025, compared to $8.0 million in fiscal 2024, mainly due to debt repayment and proceeds from the sale of three restaurant locations[133]. - As of October 5, 2025, the Company had outstanding borrowings of $177.7 million under its Credit Facility, with $29.0 million of available borrowing capacity[134]. - The Company is in compliance with all debt covenants as of October 5, 2025[135]. Share Repurchase and Future Outlook - The Company has repurchased a total of 1,088,588 shares at an average price of $15.18 per share, totaling $16.5 million, with $58.5 million remaining under the current share repurchase program[137]. - The Company expects future cash flows from restaurant operations, combined with borrowing capacity and cash on hand, to meet anticipated cash requirements and fund capital expenditures over the next 12 months[136]. Risk Factors - The Company is exposed to commodity price risks, which could negatively impact profitability due to volatility in food and beverage costs[148]. - There have been no material changes in interest rate risk or commodity price risk since the last annual report[149].