GEN Restaurant Group (GENK) Q1 2025 Earnings Call May 13, 2025 05:00 PM ET Company Participants Thomas Croal - Chief Financial OfficerDavid Kim - Chairman & CEOWill Forsberg - Equity Research Associate Conference Call Participants Todd Brooks - Equity Research AnalystGeorge Kelly - Managing Director, Senior Research Analyst Operator Please also note today's event is being recorded. At this time, I would like to turn the floor over to Tom Kearl, the company's Chief Financial Officer. Sir, you may begin. Thom ...

Core Insights - GEN Restaurant Group, Inc. reported a strong start to 2025 with the opening of six new restaurants, including a dual-concept location in Austin, Texas, combining GEN Korean BBQ and Kan Sushi [4][8] - The company anticipates total revenue for the year to be between $245 million and $250 million, with a restaurant-level adjusted EBITDA margin projected between 17% and 18% [5][8] - Despite a cautious consumer spending environment, the company achieved a 13% increase in total revenue year-over-year for Q1 2025, reaching $57.3 million compared to $50.8 million in Q1 2024 [6][8] Financial Performance - Total revenue increased by 13.0% to $57.3 million in Q1 2025 compared to $50.8 million in Q1 2024 [6][8] - Restaurant-level adjusted EBITDA rose by 6.0% to $9.0 million from $8.4 million in the prior year [8] - The company reported a net loss before income taxes of $2.1 million, equating to $(0.06) per diluted share, compared to a net income of $3.8 million or $0.11 per diluted share in Q1 2024 [11][32] Operational Highlights - The company opened six new locations in Q1 2025, bringing the total to 49 locations across eleven states [8][25] - Comparable restaurant sales decreased by 0.7% in Q1 2025, a slight improvement from a 5.6% decline for all of 2024 [8][25] - The company has a robust development pipeline, aiming to open 12 to 13 new restaurants in fiscal 2025, including three international locations in South Korea [5][8] Cost and Expense Analysis - Total restaurant operating expenses as a percentage of revenue increased by 120 basis points to 88.0% in Q1 2025 from 86.8% in Q1 2024 [7][8] - General and administrative expenses increased to $5.6 million, or 9.8% of total revenue, reflecting increased personnel for new restaurant development and additional marketing expenditures [10][8] - Pre-opening expenses rose to $2.6 million in Q1 2025 from $1.9 million in Q1 2024 due to the opening of six new restaurants [17][8] Cash Position and Liquidity - As of March 31, 2025, the company had $15.4 million in cash and cash equivalents, with no material long-term debt and full access to a $20 million line of credit [13][8] - The company maintains a strong cash flow position, which supports its strategic priorities for growth [5][8]