FAT Brands(FAT)2025-02-28 23:58Financial Data and Key Metrics Changes - Total revenue for Q4 2024 decreased by 8.4% to 158.6 million in Q4 2023, primarily due to one less operating week in the current quarter [15][42]. - System-wide sales were 67.4 million, or 26.2 million, or 30.6 million in non-cash goodwill and other intangible asset impairment during Q4 2024, primarily due to declines in restaurant performance [46]. 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 across various markets [23]. - The company continues to see significant opportunities in non-traditional venues, such as theme parks and casinos, which are expected to enhance customer reach [24]. 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 25 million by late April [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 mixed performance across brands, with some experiencing positive same-store sales while others faced challenges due to economic conditions [75]. Other Important Information - The FAT Brands Foundation increased its giving by 36% in 2024, providing approximately 325,000 in grants [34]. - The company is committed to community support, demonstrated through various initiatives during crises, such as providing meals to first responders [36][37]. Q&A Session Summary Question: Regarding the Smokey Bones impairment loss - Management confirmed that the operating loss from closed restaurants affected results throughout the year, 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 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, indicating no foreseeable issues [58][60]. Question: Performance of different brands - Management noted that Fazoli's faced high single-digit same-store declines, 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 and organic growth rather than increasing leverage [78][80].