The ONE Group Hospitality(US:STKS)2024-05-07 20:06Revenue Performance - Total revenue increased by $2.4 million, or 3.0%, to $85.0 million for the three months ended March 31, 2024, compared to $82.6 million for the same period in 2023[99]. - Total owned restaurant net revenue was $81.5 million for Q1 2024, compared to $78.6 million for Q1 2023[103]. - Owned restaurant net revenue increased by $2.9 million, or 3.7%, to $81.5 million for the three months ended March 31, 2024, compared to $78.6 million for the same period in 2023[114]. Sales Performance - Same-store sales decreased by 7.9% in Q1 2024, with STK same-store sales down 6.8% and Kona Grill down 9.7%[99]. - Comparable restaurant sales decreased by 7.9% in Q1 2024 compared to Q1 2023[114]. - Management and license fee revenues decreased by $0.5 million, or 12.3%, to $3.5 million for Q1 2024 from $4.0 million in Q1 2023[115]. Profitability - Restaurant operating profit increased by $0.3 million, or 2.0%, to $13.2 million, representing 16.1% of owned restaurant net revenue[100]. - Operating income decreased by $4.9 million to an operating loss of $0.6 million for Q1 2024, primarily due to higher depreciation and preopening costs[101]. - Net loss attributable to The ONE Group Hospitality, Inc. was $2.1 million for Q1 2024, compared to net income of $2.6 million in Q1 2023[103]. Expenses - General and administrative expenses were $7.5 million for Q1 2024, slightly up from $7.5 million in Q1 2023[103]. - Owned restaurant operating expenses increased by $2.8 million to $49.6 million, with operating costs as a percentage of owned restaurant net revenue increasing from 59.6% to 60.9%[117]. - Depreciation and amortization expenses increased to $5.3 million in Q1 2024 from $3.7 million in Q1 2023, primarily due to new venue openings[119]. - Pre-opening expenses for Q1 2024 were $2.9 million, up from $1.3 million in Q1 2023[120]. Debt and Financing - The company entered into a credit agreement providing a $350.0 million senior secured term loan facility and a $40.0 million revolving credit facility[97]. - Interest expense increased to $2.1 million in Q1 2024 from $1.8 million in Q1 2023, with a weighted average interest rate of 12.3%[125]. - The company may borrow on its revolving credit facility or issue equity to support ongoing business and fund additional expansion[128]. Cash Flow and Investments - Net cash provided by operating activities increased to $10.4 million for the three months ended March 31, 2024, from $6.6 million in the same period of 2023[140]. - Net cash used in investing activities was $15.8 million for the three months ended March 31, 2024, compared to $11.9 million for the same period in 2023[141]. - Capital expenditures for the three months ended March 31, 2024, were $15.8 million, with $14.1 million allocated to the opening of five new restaurants[129]. Future Plans - The company plans to open six to eight new STK or Kona Grill venues in 2024[88]. - The company expects to receive between $2.2 million and $2.8 million in landlord contributions in the next three months[129]. - The company limits the number of owned venues under construction to four restaurants to manage cash requirements[134]. Financial Position - As of March 31, 2024, the company had cash and cash equivalents of $15.4 million and long-term debt of $73.5 million[128]. - General and administrative costs were $7.5 million for both Q1 2024 and Q1 2023, with a slight decrease in percentage from 9.1% to 8.9%[118]. - Net cash used in financing activities was $0.2 million for the three months ended March 31, 2024, compared to $1.1 million in the same period of 2023[142].