Core Viewpoint - FAT Brands, a restaurant chain, has filed for bankruptcy after a rapid expansion fueled by a unique financing model that involved selling stocks to its fan base, leading to significant financial losses and a forced delisting from NASDAQ [1][2][11]. Group 1: Company Background - FAT Brands originated from the acquisition of Fatburger by Fog Cutter Capital in 2003, which was founded by Andrew Wiederhorn, a seasoned entrepreneur in capital operations [3][4]. - Fatburger, established in 1947, became a cultural icon in the U.S., attracting a loyal customer base, including celebrities [3][4]. - In 2017, FAT Brands went public via the Regulation A+ route, raising $24 million primarily from its fan base [2][6]. Group 2: Expansion Strategy - Following its IPO, FAT Brands aggressively expanded through acquisitions, growing to over 200 locations across 40 countries and achieving total sales of $2.4 billion by 2024 [2][5]. - The company employed a "merger + integration + franchising" model, acquiring multiple brands and rapidly expanding their franchise network [6][5]. Group 3: Financial Challenges - Despite initial success, FAT Brands faced a decline in store openings, with a peak of 142 new stores in 2022, dropping to only 92 in 2024, leading to cash flow issues [7][8]. - The company reported a net loss of $190 million in 2024, with interest expenses alone reaching $120 million [8][9]. - To manage its debts, FAT Brands cut marketing expenses, which negatively impacted brand value and franchisee revenues [9][10]. Group 4: Bankruptcy and Consequences - FAT Brands filed for bankruptcy after failing to meet financial obligations, with stock prices plummeting by 97.6% from their peak [9][10]. - The bankruptcy affected shareholders, franchisees, and bondholders, all of whom faced significant losses [10][11]. - Andrew Wiederhorn, despite the company's financial troubles, reportedly profited significantly from dividends and alleged misappropriation of funds for personal expenses [10][11].

Core Viewpoint - Twin Hospitality Group, the parent company of Twin Peaks, has filed for Chapter 11 bankruptcy, following a trend in the casual dining sector where similar establishments like Hooters have also faced financial difficulties [1][3]. Group 1: Bankruptcy Filing - Twin Hospitality Group filed for Chapter 11 bankruptcy on January 26, 2025, in the U.S. Bankruptcy Court for the Southern District of Texas [1]. - The bankruptcy filing comes shortly after Fat Brands, which owns Twin Hospitality Group, began converting Smokey Bones locations into Twin Peaks [2]. - The first hearing for the bankruptcy filing is scheduled for January 28, 2025 [3]. Group 2: Company Operations - Twin Peaks operates 114 locations across the United States and Mexico and is expected to remain open during the bankruptcy process [4]. - The company has faced challenging market conditions that have hindered its ability to restructure debt, despite the brand's strength [5]. Group 3: Industry Context - Hooters filed for Chapter 11 bankruptcy in March 2025, addressing $376 million in debt, and closed over 30 locations in June 2025 [3]. - The casual dining sector is experiencing significant challenges, as evidenced by the recent bankruptcies and closures of multiple restaurant chains [5].

Financial Data and Key Metrics Changes - The company reported a cautious but cautiously optimistic consumer environment, with recent weeks showing improved sales [5] - Same-store sales were down approximately 3% to 3.5% across all 18 brands, which is considered manageable in the current environment [28] - The company has sold around 200 new franchise units and opened over 70 new stores, with plans to open another 100 this year [28] Business Line Data and Key Metrics Changes - The company has expanded its portfolio to 18 brands, including high-growth brands like Fatburger, Johnny Rockets, and Round Table Pizza [4][7] - The manufacturing operation, which produces cookie dough and pretzel mix, has increased its capacity utilization from 30% to 45%, generating approximately $15 million in annual EBITDA [11][12] Market Data and Key Metrics Changes - The company has seen a positive shift in consumer behavior, with sales improving significantly in recent weeks [5] - Franchisee confidence is indicated by the sale of several hundred incremental franchise units over the past few years, with 213 units sold recently [6] Company Strategy and Development Direction - The company focuses on co-branded and multi-branded locations, expecting 10%-20% higher revenues from these formats [8] - The strategy includes converting select Smoky Bones locations into Twin Peaks, which has shown a potential to double sales in converted locations [18][21] Management's Comments on Operating Environment and Future Outlook - Management acknowledges the challenges posed by rising interest rates and a difficult equity market, but emphasizes the strength of the brand portfolio and the potential for restructuring debt [24][28] - The company aims to restructure its debt to make it more manageable, with ongoing discussions with noteholders [26][27] Other Important Information - The company has a unique manufacturing operation that complements its restaurant portfolio, providing high-margin products to franchisees [11] - The spinout of Twin Peaks into a publicly traded company was a strategic move to raise equity and pay down debt [14][15] Q&A Session Summary Question: What is the current state of the consumer? - Management noted a cautious but cautiously optimistic consumer environment, with recent sales improvements [5] Question: How is the development pipeline looking? - The company has sold a couple hundred incremental franchise units, indicating strong franchisee confidence [6] Question: What are the growth opportunities in non-traditional locations? - Non-traditional locations can be lucrative if they have good traffic flow, and the company is exploring these opportunities [10] Question: How does the manufacturing operation fit into the long-term strategy? - The manufacturing facility is seen as a significant opportunity, currently running at 45% capacity and generating high margins [11][12] Question: What is the outlook for Twin Peaks and Smoky Bones? - The company is converting some Smoky Bones into Twin Peaks, which has shown promising sales increases [18][21]

Core Viewpoint - FAT Brands has received a delisting notice from Nasdaq due to its stock price falling below $1.00 for 30 consecutive days, with a compliance deadline of 180 days to regain the required stock price [1][4]. Group 1: Delisting Notice and Compliance - The company has until July 7, 2026, to regain compliance by closing above $1.00 for 10 consecutive days, or it will face delisting from the Nasdaq stock market [1]. - The delisting notice follows recent financial struggles, including debt acceleration notices from lenders and potential bankruptcy considerations [2]. Group 2: Stock Performance - FAT Brands' stock price has decreased nearly 80% over the past six months, dropping from a peak of $2.30 in September 2025 to $0.37 as of January 9, 2026 [4]. - The company has not maintained the Nasdaq requirement of a minimum stock price of $1.00 since November 19, 2025 [4]. Group 3: Financial Strategy and Operations - The company has financed its growth and debt reduction primarily through brand acquisitions, including notable purchases like Johnny Rockets in 2020 and Smokey Bones in 2023 [3]. - An internal memo indicated that FAT Brands is in "active talks" with bondholders to restructure its balance sheet while assuring franchisees that everyday operations would continue as usual [5].

LOS ANGELES, April 04, 2025 (GLOBE NEWSWIRE) -- FAT (Fresh. Authentic. Tasty.) Brands Inc. (NASDAQ:FAT) ("FAT Brands" or the "Company"), a leading global franchising company and parent company of iconic brands including Round Table Pizza, Fatburger, Johnny Rockets, Twin Peaks, Fazoli's and 13 other restaurant concepts, announces amendments to its whole business securitization credit facility for its Fazoli's and Native Grill & Wings restaurant brands (the "Fazoli's Securitization"). The amendments to the Fa ...

Financial Data and Key Metrics Changes - Total revenue for Q4 2024 decreased by 8.4% to $145.3 million compared to $158.6 million in Q4 2023, primarily due to one less operating week in the current quarter [15][43] - System-wide sales were $580.2 million for the quarter, representing a 7.4% decrease from the previous year, again impacted by the fewer operating weeks [15][43] - The net loss for Q4 2024 was $67.4 million, or $4.06 per diluted share, compared to a net loss of $26.2 million, or $1.68 per share in the prior year [47] - Adjusted EBITDA for the quarter was $14.4 million, down from $27 million in the year-ago quarter [48] Business Line Data and Key Metrics Changes - The company opened 92 new restaurants in 2024 and plans to open over 100 in 2025, with 17 units already opened year-to-date [18][19] - The company is focusing on organic growth across its existing brand portfolio, with a pipeline of over 1,000 additional locations signed [20] - Co-branding initiatives have been successful, with Great American Cookies and Marble Slab Creamery growing to over 160 co-branded locations since 2014 [21] Market Data and Key Metrics Changes - International locations for Johnny Rockets now represent over 55% of the brand's global footprint, with 11 new international locations opened in 2024 [23] - The company continues to expand in key international markets, with over 40 locations in Brazil and nearly 25 in Mexico [23] Company Strategy and Development Direction - The company is focused on three core strategic initiatives: generating organic growth, evaluating strategic acquisitions, and expanding manufacturing capabilities [17] - The spin-off of Twin Hospitality Group is seen as a major milestone, enhancing transparency and providing additional growth opportunities for shareholders [7][8] - The company aims to reduce debt by $75 million or more in 2025, with a commitment to not pay a FAT common dividend until a minimum of $25 million is paid [11] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about 2025, highlighting strong consumer demand and a robust development pipeline [20][38] - The company noted challenges in the QSR sector, particularly with Fazoli's, but also mentioned positive trends in other brands like Round Table Pizza [75] - Management is focused on deleveraging the balance sheet while executing on organic growth opportunities [38][80] Other Important Information - The company recognized a non-cash goodwill and other intangible asset impairment of $30.6 million in Q4 2024 due to declining restaurant performance [46] - The FAT Brands Foundation increased its giving by 36% in 2024, providing approximately $325,000 in grants [34] Q&A Session Summary Question: Regarding the Smokey Bones impairment loss - Management confirmed that the operating loss from closed restaurants affected results, quantified at about $2.6 million for the full year [50][53] Question: Update on litigation costs - Management expressed hope that most litigation would be resolved in the current year, potentially reducing future legal expenses [54][56] Question: Liquidity status - Management reported approximately $150 million in available-for-sale securities and an ATM on file for liquidity needs [58][59] Question: Performance of different brands - Management noted that Fazoli's faced challenges, while Round Table Pizza and cookie brands showed positive performance [75] Question: M&A pipeline post-election - Management indicated ongoing interest in strategic acquisitions but emphasized a focus on deleveraging rather than increasing leverage [78][80]