Good Times(US:GTIM)2021-02-05 16:00Financial Performance - Net revenues for the quarter ended December 29, 2020 decreased by $3,518,000 or 11.4% to $27,296,000 from $30,814,000 for the quarter ended December 31, 2019[93]. - Net income for the quarter ended December 29, 2020 was $1,165,000, a significant improvement from a net loss of $599,000 in the same quarter of the previous year[127]. - Adjusted EBITDA for the quarter ended December 29, 2020 was $1,793,000, compared to $1,514,000 for the quarter ended December 31, 2019[135]. Sales Performance - Bad Daddy's restaurant sales decreased by $4,122,000 to $18,691,000 for the quarter ended December 29, 2020, primarily due to COVID-19 related dining room closures and reduced capacity[94]. - Good Times restaurant sales increased by $610,000 to $8,390,000 for the quarter ended December 29, 2020, driven by improved customer traffic and a 4.5% average menu price increase[96]. - Bad Daddy's same store restaurant sales decreased by 11.8% during the quarter ended December 29, 2020, while Good Times same store restaurant sales increased by 22.1%[98][99]. Cost Management - Food and packaging costs for the quarter ended December 29, 2020 decreased to $7,841,000, representing 29.0% of restaurant sales, down from 30.4% in the prior year[100]. - Payroll and other employee benefit costs decreased to $8,881,000 (32.8% of restaurant sales) from $11,979,000 (39.2% of restaurant sales) for the same prior-year period[103]. - Other operating costs increased by $467,000 to $3,469,000 (12.8% of restaurant sales) compared to $3,002,000 (9.8% of restaurant sales) in the prior year[109]. Restaurant Operations - The company expects to open two Bad Daddy's restaurants during fiscal 2021, indicating a focus on targeted unit growth[89]. - As of December 29, 2020, the company operated a total of 39 Bad Daddy's restaurants and 32 Good Times restaurants[90]. - Preopening costs for the quarter ended December 29, 2020 were $39,000, significantly lower than $802,000 for the quarter ended December 31, 2019, primarily related to Bad Daddy's restaurants[112]. Advertising and Marketing - Bad Daddy's advertising costs were $168,000 (0.9% of total revenue) for the quarter ended December 29, 2020, down from $235,000 (1.0% of total revenue) in the same prior year period[119]. - Good Times advertising costs increased to $341,000 (4.0% of total revenue) for the quarter ended December 29, 2020, compared to $311,000 (3.9% of total revenue) in the prior year[121]. Financial Obligations and Liabilities - As of December 29, 2020, the company had a working capital deficit of $6,135,000, with total commitments outstanding of $353,000 related to construction contracts for Bad Daddy's restaurants[137]. - The Company maintains a Cadence Credit Facility with a loan commitment of up to $17,000,000, which was reduced to $11,000,000 as of January 8, 2021, with a maturity date extended to January 31, 2023[138]. - The Company entered into unsecured loans under the Paycheck Protection Program totaling $11,645,000, with an interest rate of 1.00% per annum, and expects to apply for forgiveness during 2021[143][144]. Cash Flow - Net cash provided by operating activities for the quarter ended December 29, 2020 was $847,000, resulting from a net income of $1,165,000 and cash reconciling items totaling $318,000[146]. - Net cash used in investing activities for the quarter ended December 29, 2020 was $480,000, primarily reflecting purchases of property and equipment[148]. - Net cash used in financing activities for the quarter ended December 29, 2020 was $1,806,000, including principal payments on notes payable and long-term debt of $1,500,000[148]. Compliance and Contingencies - The Company remains contingently liable on various leases underlying restaurants sold to franchisees, with no current defaults reported[150]. - The Company was in compliance with all covenants under the Cadence Credit Facility as of December 29, 2020, including a maximum leverage ratio of 5.35:1[140]. - The Company has not yet received a decision from the SBA regarding the forgiveness of its PPP loans, which could impact future cash flows[145].