FAT Brands(US:FAT)2025-05-08 22:32Financial Data and Key Metrics Changes - Total revenue for Q1 2025 was $142 million, reflecting a 6.5% decrease from $152 million in the same period last year [12][30] - Adjusted EBITDA was $11.1 million compared to $18.2 million in the prior year quarter [13][32] - Net loss attributable to FAT Brands was $46 million or $2.73 per diluted share, compared to a net loss of $38.3 million or $2.37 per share in the prior year [31] Business Line Data and Key Metrics Changes - System-wide sales were $571.1 million, down 1.8% compared to the previous year's quarter [13] - The Casual Dining segment saw same-store sales increase approximately 1.6%, driven by Buffalo's Cafe and Ponderosa and Bonanza locations [14] - Factory revenue decreased by about 7%, attributed to lower same-store sales and the absence of Smoky Bones locations [54] Market Data and Key Metrics Changes - Domestic system-wide sales outperformed international sales for the quarter, although there was an encouraging rebound in international locations towards the end of Q1 [13] - Digital sales at Roundtable Pizza increased by 5% sequentially from Q4 2024 to Q1 2025 [16] Company Strategy and Development Direction - The company is focused on expanding its brand presence with commitments for over 1,000 new locations already in the pipeline [14] - A strategic move involved spinning off Twin Hospitality Group Inc, which is now listed separately on Nasdaq [7] - The company aims to enhance production capabilities at its Georgia facility, particularly in cookie dough and dry mix manufacturing [15][26] Management's Comments on Operating Environment and Future Outlook - Management noted that consumer confidence is mixed, with consumers being apprehensive and focused on value [40][41] - The company is committed to debt reduction and leveraging its robust pipeline of growth opportunities [29] - Management expressed confidence in achieving full annual equity target raises over the next twelve months despite current market volatility [10][44] Other Important Information - The company has temporarily paused FAT's common dividend and started accruing the FAT Series B preferred dividend until certain financial thresholds are met [11] - The company is focused on refranchising its Fazoli's locations, which could generate approximately $20 million to $25 million in proceeds for debt reduction [59] Q&A Session Summary Question: Impact of cookie facility utilization increase - Management aims to increase the cookie facility's revenue from $15 million to $25 million annually with improved utilization [34][35] Question: Consumer focus on value - Management noted that consumers are looking for great food and experiences to justify prices, indicating a continued focus on value [40][41] Question: Smoky Bones negative impact on EBITDA - Management estimated a couple million dollars negative impact from Smoky Bones on adjusted EBITDA for the quarter [66][67] Question: Timeline for finding a new CEO - The executive search for a new CEO is progressing well, with expectations to conclude within the quarter [73] Question: Incremental adjusted EBITDA from new stores and factory - Management anticipates achieving the targeted incremental adjusted EBITDA over the next couple of years [77]