The ONE Group Hospitality(US:STKS)2022-08-04 20:14Revenue Performance - Total revenues increased by $10.4 million, or 14.6%, to $81.1 million for the three months ended June 30, 2022, compared to $70.8 million for the same period in 2021[88]. - Total revenues increased by $34.1 million, or 28.1%, to $155.3 million for the six months ended June 30, 2022, compared to $121.2 million for the same period in 2021[90]. - Total revenues for the three months ended June 30, 2022, reached $81.125 million, compared to $70.760 million for the same period in 2021, reflecting a significant growth[96]. Same Store Sales - Same store sales increased by 12.8% in Q2 2022 compared to Q2 2021, with STK same store sales up by 19.8% and Kona Grill same store sales up by 3.7%[88]. - Comparable restaurant sales increased by 12.8% for the second quarter of 2022 compared to the second quarter of 2021, indicating strong sales performance[103]. - Comparable restaurant sales increased by 26.3% in the first half of 2022[114]. Operating Profit and Income - Restaurant operating profit decreased by $2.6 million, or 16.7%, to $12.8 million for the three months ended June 30, 2022, compared to $15.3 million for the same period in 2021[89]. - Operating income for the three months ended June 30, 2022, was $5.753 million, down from $7.756 million in the same period of 2021[100]. - Operating income for the six months ended June 30, 2022, was $10.0 million, compared to $8.6 million for the same period in 2021[90]. Net Income and EBITDA - Net income attributable to The One Group Hospitality, Inc. was $4.303 million for the three months ended June 30, 2022, compared to $13.836 million for the same period in 2021[99]. - Adjusted EBITDA for the three months ended June 30, 2022, was $10.561 million, compared to $13.205 million for the same period in 2021[99]. Expenses and Costs - Food and beverage costs for owned restaurants increased by $8.8 million, or 30.0%, to $38.0 million for the six months ended June 30, 2022, from $29.2 million for the same period in 2021[116]. - Owned restaurant operating expenses increased by $20.5 million to $83.7 million for the six months ended June 30, 2022, from $63.2 million for the same period in 2021[117]. - General and administrative costs increased by $2.8 million, or 25.0%, to $14.1 million for the six months ended June 30, 2022, compared to $11.3 million for the same period in 2021[118]. Cash Flow and Financing - Net cash provided by operating activities was $14.9 million for the six months ended June 30, 2022, compared to $19.8 million for the same period in 2021[136]. - Net cash used in financing activities for the six months ended June 30, 2022, was $1.8 million, with $1.4 million allocated to employee taxes for shares withheld upon vesting of restricted stock units[138]. - Net cash provided by financing activities for the six months ended June 30, 2021, was $2.6 million, primarily from proceeds of stock options and warrants[138]. Future Plans and Growth Strategy - The company plans to open at least nine new venues in 2022, including two STK and two Kona Grill restaurants, and three licensed units in Texas for takeout and delivery[83]. - The company aims to increase same store sales and improve operating efficiency as part of its growth strategy[86]. COVID-19 Impact - COVID-19 related expenses were $0.2 million for Q2 2022, down from $1.1 million in Q2 2021, reflecting improved operational conditions[84]. - COVID-19 related expenses decreased to $2.5 million for the six months ended June 30, 2022, from $2.6 million in the prior year period[121]. Assets and Capital Expenditures - Total assets as of June 30, 2022, amounted to $235.227 million, an increase from $229.835 million as of December 31, 2021[96]. - Capital asset additions for the three months ended June 30, 2022, totaled $7.641 million, compared to $2.758 million for the same period in 2021[96]. - Capital expenditures were $12.1 million for the six months ended June 30, 2022, primarily for the construction of new STK and Kona Grill restaurants[126]. Accounting and Impairment Testing - The company has added a critical accounting estimate regarding indefinite-lived intangible assets, which are tested for impairment annually or on an interim basis[141]. - Qualitative factors considered for impairment testing include historical financial performance, expected future cash flows, and macroeconomic conditions[142]. - Quantitative assessments for impairment require estimates on future cash flows, including projected revenue growth and operating expenses[143]. - Changes in economic conditions and operating performance may affect the company's ability to realize future cash flows[143]. - The company does not expect recent accounting pronouncements to significantly impact its consolidated financial position or results of operations[140]. - As a "smaller reporting company," the company is not required to provide detailed market risk disclosures[144].