Financial Data and Key Metrics Changes - The company achieved total consolidated GAAP revenues of $207.4 million, an increase of 20.2% from $172.5 million in the same quarter last year [20] - Adjusted EBITDA was $23.4 million, reflecting a 7.3% increase from $21.8 million in the prior year quarter [27] - Net loss was $10.1 million compared to a net loss of $7.3 million in the previous year, with adjusted net income at $1.7 million, down from $6.3 million [26][27] Business Line Data and Key Metrics Changes - Company-owned restaurant net revenues increased by 20.6% to $203.9 million, primarily due to the additional days of ownership of Benihana and Ra Sushi [20] - Restaurant EBITDA decreased to 15.4% from 17.5% in the prior year quarter, with Benihana locations at 18.5% and STK locations at 15.9% [22] - The company closed five locations that were underperforming or nearing lease renewals, indicating a focus on optimizing the growth portfolio [14] Market Data and Key Metrics Changes - The company noted that traffic in the upscale casual segment remains challenged, particularly in Las Vegas, which has been impacted by shifting convention schedules and visitor traffic declines [51][53] - Demand remains strong during peak periods, especially on weekends, with strategies in place to maximize throughput [8] Company Strategy and Development Direction - The company aims to drive same-store sales growth through operational excellence, culinary innovation, and targeted marketing [8] - A focus on asset-light growth opportunities is evident, with plans to open five to seven new venues in 2025, including a company-owned Benihana in Seattle [12][30] - The integration of Benihana is progressing ahead of plan, with significant synergies expected to be realized by the end of 2026 [16] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving a strong fourth quarter, driven by holiday traffic and improved logistics at Benihana [55][56] - The company is optimistic about its ability to navigate the current economic environment, focusing on internal factors rather than external economic conditions [58][59] - The loyalty program launched in Q2 is expected to enhance guest frequency and spending, with significant engagement anticipated in the upcoming quarters [90] Other Important Information - The company has approximately $50 million in liquidity, providing operational flexibility [15] - The new Benihana location in San Mateo has been performing exceptionally well, serving as a prototype for future openings [39][40] Q&A Session Summary Question: What were the issues faced by Benihana last year? - Management indicated that HVAC issues were significant challenges post-acquisition, which have since been addressed for better sales opportunities this year [35][36] Question: Can you discuss the new restaurant in San Mateo? - The San Mateo location has a different design, eliminating the sushi bar to increase table capacity, and has seen strong initial performance [37][39] Question: How is STK managing traffic in the current environment? - The strategy focuses on value pricing and happy hour promotions to drive traffic, while also emphasizing premium products [42] Question: What are the regional differences in same-store sales? - Vegas has been a challenged market due to shifting convention schedules and visitor traffic declines, while other regions performed consistently [51][53] Question: What gives confidence in maintaining annual guidance? - Management highlighted the strong performance of Benihana and STK, particularly during the holiday season, as key factors for confidence in guidance [55][56] Question: Can you elaborate on franchising efforts for Benihana? - There is growing interest from existing franchisees, and the company is actively participating in industry events to build a pipeline for new agreements [75][78] Question: What is the outlook for food inflation? - While some commodity prices have stabilized, beef prices remain a concern, but the company is prepared to navigate these challenges through innovation [70][72]