Nathan's(NATH) - 2026 Q3 - Quarterly Report

Financial Performance - Total revenues for the thirteen weeks ended December 28, 2025, increased to $34.3 million, up 8.6% from $31.5 million for the same period in 2024[11] - Net income for the thirteen weeks ended December 28, 2025, was $3.1 million, a decrease of 31.2% compared to $4.5 million for the same period in 2024[11] - The company reported a gross profit margin of 10.5% for the thirteen weeks ended December 28, 2025, compared to 22.1% for the same period in 2024[11] - Net income for the thirty-nine weeks ended December 28, 2025, was $17,211,000, a decrease from $19,791,000 for the same period in 2024, representing a decline of approximately 13%[19] - Total revenues for the thirty-nine weeks ended December 28, 2025, were $126,997,000, an increase of 8% compared to $117,395,000 for the same period in 2024[29] - Branded Products revenue for the thirty-nine weeks ended December 28, 2025, was $81,871,000, up from $71,781,000 in 2024, reflecting a growth of approximately 14%[29] - Basic net income per share for the thirty-nine weeks ended December 28, 2025 was $4.21, compared to $4.84 for the same period in 2024, a decline of 13.0%[37] - The Company reported a net income of $4,748,000 for the thirteen weeks ended December 28, 2025, compared to $6,059,000 for the same period in 2024, a decline of 21.6%[65] Cash and Assets - Cash and cash equivalents decreased to $24.5 million as of December 28, 2025, from $27.8 million as of March 30, 2025[8] - Total assets decreased to $50.9 million as of December 28, 2025, from $53.5 million as of March 30, 2025[8] - Total cash and cash equivalents at the end of the period were $24,545,000, an increase from $23,711,000 at the end of the previous year[19] - Cash and cash equivalents were reported at $16,280,000 as of December 28, 2025, down from $19,400,000 as of March 30, 2025[38] - The Company’s total current assets were reported at $43,946,000 as of December 28, 2025, down from $45,135,000[8] Liabilities and Equity - Total liabilities decreased to $66.2 million as of December 28, 2025, from $70.0 million as of March 30, 2025[8] - The company’s retained earnings increased to $7.4 million as of December 28, 2025, compared to $6.6 million as of March 30, 2025[8] - The company’s retained earnings increased to $7,416,000 as of December 28, 2025, from $4,373,000 as of December 29, 2024[19] - The company’s long-term debt as of December 28, 2025, was $46,326,000, down from $48,073,000 on March 30, 2025[76] Dividends - The company declared dividends of $3.00 per share, totaling $12.3 million for the thirteen weeks ended December 28, 2025[12] - Dividends paid to stockholders increased to $16,358,000 for the thirty-nine weeks ended December 28, 2025, compared to $6,127,000 in 2024, marking a significant increase of approximately 167%[19] - The Company paid quarterly dividends of $0.50 per share on July 1, September 5, and December 5, 2025, along with a special cash dividend of $2.50 per share on December 5, totaling $16,358 million in dividends paid through December 28, 2025[72] Operational Metrics - Cash flows from operating activities for the thirty-nine weeks ended December 28, 2025, provided $15,692,000, compared to $18,450,000 in 2024, indicating a decrease of about 15%[19] - Total costs and expenses for the thirty-nine weeks ended December 28, 2025, were $101,577,000, compared to $87,266,000 for the same period in 2024, an increase of 16.4%[11] - The cost of sales rose to $23,138,000 for the thirteen weeks ended December 28, 2025, compared to $19,571,000 in the same period of 2024, marking an increase of 18.5%[11] Taxation - The effective income tax rate for the thirty-nine weeks ended December 28, 2025 was 28.4%, higher than the 26.5% rate for the same period in 2024[56] - The effective income tax rate for the thirteen weeks ended December 28, 2025, was 35.0%, up from 26.0% for the same period in 2024[54] - The Company reported $1,664,000 of income tax expense on $4,748,000 of pre-tax income for the thirteen weeks ended December 28, 2025[55] Share Repurchase and Compensation - As of December 28, 2025, the company repurchased 1,101,884 shares at a cost of $39,000 under the stock repurchase plan, with 98,116 shares remaining to be repurchased[75] - Total share-based compensation for the thirteen weeks ended December 28, 2025, was $280 million, slightly down from $288 million in the same period of 2024[68] - Share-based compensation for the thirty-nine weeks ended December 28, 2025, totaled $852,000, up from $705,000 in the same period of 2024, reflecting an increase of 20.9%[68] Merger and Acquisition - The Company entered into a Merger Agreement with Smithfield Foods, Inc. on January 20, 2026, which includes the payment of all outstanding obligations under the Credit Facility[86] - At the Effective Time of the Merger, each share of common stock of the Company will be converted into cash of $102.00 per share[97] - The Company will pay a cash termination fee of $10,581,814 if the Merger Agreement is terminated under specific conditions, including a change in the Company Board's recommendation[102] - The Company has agreed to customary "no-shop" restrictions to avoid soliciting alternative competing transactions[99] - The Merger is subject to conditions including Company Stockholder Approval and the absence of a Company Material Adverse Effect[101]