Financial Data and Key Metrics Changes - Total revenue for Q2 2021 increased by 65% to $11.8 million compared to $7.2 million in Q2 2020 [17] - Net income attributable to controlling interests rose to $9 million from $100,000 in the prior year, primarily due to a gain on the change in value of warrant liability [21] - Adjusted EBITDA for Q2 2021 was $300,000, down from $500,000 in the same quarter last year, reflecting additional public company expenses [22] Business Line Data and Key Metrics Changes - Corporate-owned restaurants experienced a 39% increase in same-store sales, surpassing 2019 levels [17] - Franchise locations saw a 45% increase in same-store sales during Q2 2021 [18] - Systemwide sales increased by 63% to $44.2 million compared to $27.1 million in Q2 2020, with same-store sales up 44% [18] Market Data and Key Metrics Changes - Digital channel sales grew by 12% year-over-year, comprising 39% of systemwide revenue in Q2 2021 [19] - Preliminary same-store sales for July 2021 showed continued growth against 2019 levels, despite some franchise locations being temporarily closed [27][92] Company Strategy and Development Direction - The company plans to open 25 to 30 new company and franchise-operated restaurants in 2021, with 8 already opened year-to-date [24] - Focus on enhancing guest experience through digital and off-premise dining options, including the expansion of Ghost Kitchens [30] - Strategic growth in the Southeast and plans to expand up the Eastern seaboard, with a focus on multi-unit franchise deals in the Southwest and Midwest [34][36] Management's Comments on Operating Environment and Future Outlook - Management remains optimistic about short-term and long-term prospects, expecting restaurant level margins to improve due to a recent price increase [26] - The company is navigating the challenges posed by the Delta variant but has not seen significant changes in sales behavior [92] - Continued investment in technology to enhance customer experience and operational efficiency is a priority [32] Other Important Information - The company has over 25 signed leases for new locations, with 18 under various stages of construction and development [24] - The Ghost Kitchen strategy is seen as a low-capital way to expand brand presence in new markets [31] Q&A Session Summary Question: Can you talk about the expected sales volumes from Ghost Kitchens? - The royalty and brand contribution from Ghost Kitchens is similar to franchisees, ranging from 4.5% to 5.5% of sales, but specific revenue projections are still early [40][41] Question: Are franchisees seeing similar margin improvements? - Franchisees have the right to price according to their markets, and many have followed the company's pricing strategy [46] Question: Can you provide an update on the loyalty program? - The company is developing KPIs for the loyalty program and will provide updates in the future [47] Question: What are the licensing fees for international agreements? - Licensing fees vary based on the number of units a franchisee plans to open, with upfront fees ranging from several hundred thousand to over half a million [49] Question: Can you comment on the impact of the Delta variant? - The Delta variant is a concern, but there has been no significant change in sales behavior observed [92] Question: What are the trends across different markets? - Transaction trends are similar to 2019, with strong average transaction values despite some franchise locations being temporarily closed [88][90]
BurgerFi(BFI) - 2021 Q2 - Earnings Call Transcript