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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

 

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

 

Date of Report (Date of earliest event reported)

August 1, 2024

 

 

Good Times Restaurants Inc.

(Exact name of registrant as specified in its charter) 

 

Nevada   000-18590   84-1133368

(State or other jurisdiction

of incorporation)

 

(Commission

File Number)

 

(IRS Employer

Identification No.)

 

651 Corporate Circle, Suite 200, Golden, CO 80401

(Address of principal executive offices including zip code)

 

Registrant’s telephone number, including area code: (303) 384-1400

 

Not applicable

(Former name or former address, if changed since last report.)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of
the registrant under any of the following provisions (see General Instruction A.2.):

 

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Securities registered pursuant to Section 12(b) of the Act: 

 

Title of each class   Trading
Symbol(s)
  Name of each exchange
on which registered
Common Stock, $0.001 par value   GTIM   Nasdaq Capital Market

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).

 

Emerging growth company ¨

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

 

 

   

 

Item 2.02 Results of Operations and Financial Condition.

 

On August 1, 2024, Good Times Restaurants Inc. issued a press release announcing earnings and other financial results for the third fiscal quarter ended June 25, 2024, and that management would review these results in a conference call on August 1, 2024, at 5:00 p.m. ET.

 

Item 9.01 Financial Statements and Exhibits.

 

(d) Exhibits. The following exhibits are filed as part of this report.

 

Exhibit Number   Description
99.1   Press Release dated August 1, 2024
     
104   Cover Page Interactive Data File (embedded within the Inline XBRL document)

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

 

  GOOD TIMES RESTAURANTS INC.
     
Date:     August 1, 2024 By:  
    Ryan M. Zink
    Chief Executive Officer

 

 

2

 

 

 

EX-99.1 2 ex99_1.htm EXHIBIT 99.1

 

Exhibit 99.1

 

 

FOR IMMEDIATE RELEASE  
August 1, 2024 Nasdaq Capital Markets - GTIM

 

GOOD TIMES RESTAURANTS REPORTS RESULTS FOR
THE 2024 THIRD FISCAL QUARTER ENDED JUNE 25, 2024

 

(DENVER, CO) Good Times Restaurants Inc. (Nasdaq: GTIM), operator of the Bad Daddy’s Burger Bar and Good Times Burgers & Frozen Custard restaurant brands, today reported financial results for the 2024 third fiscal quarter.

 

Key highlights of the Company’s financial results include:

 

· Total Revenues for the quarter increased 6.5% to $37.9 million compared to the third quarter of fiscal 2023

 

· Same Store Sales1 for company-owned Bad Daddy’s restaurants increased 1.2% for the quarter compared to the third quarter of fiscal 2023

 

· Same Store Sales for company-owned Good Times restaurants increased 5.8% for the quarter compared to the third quarter of fiscal 2023

 

· Net Income Attributable to Common Shareholders was $1.3 million for the quarter

 

· The Company ended the quarter with $4.8 million in cash and $0.8 million of borrowings under its credit facility with Cadence Bank

 

· The Company repurchased 263,516 shares of its common stock during the quarter, including approximately 171,000 shares in a privately negotiated purchase

 

Ryan M. Zink, the Company’s Chief Executive Officer, said, “The Good Times brand produced strong same store sales again this quarter, and we are extremely pleased with the bottom line results the concept continues to generate. During the quarter, we accomplished several significant reinvestment milestones including completion of our fourth remodel, this one much more extensive, including structural repairs. The restaurant was closed for nearly six weeks during construction. Additionally, as previously reported, in April we began the pilot phase of our next-generation point-of-sale system. We quickly realized the benefits of this new system, assessed the test results, addressed minor issues, and moved to the rollout phase of the project and as of the end of July, the system has been installed in nineteen locations, with seven Company-owned locations yet to be installed. Those restaurants will be completed within the next four weeks, with our Denver-area franchise restaurants expected to be converted shortly thereafter. We also acquired a franchisee-owned restaurant in Parker, Colorado during the quarter, and made quick improvements to the facility, including new awnings, overhauled the parking lot and landscaping, and have both digital menu boards and new signage scheduled for installation.”

 

Mr. Zink continued, “I am also thrilled with the improvement in same store sales at Bad Daddy’s, with positive same store sales for the quarter. We have continued the trend of improved performance compared to the Black Box casual dining benchmark. Competition in the casual dining, burger-focused segment continues to be intense as our guests look for value through reasonable prices without compromises on service, quality, or portions. While we continue to look to creating value through drink specials and targeted discounting, late in the quarter we introduced new limited time burgers featuring quarter-pound, smashed patties. These burgers were an immediate success, and we had to dip into reserve stock and quickly recover as purchase velocity was more than double our expectation. Though this product offering is currently slated to end post-Labor Day, we expect these burgers to return and likely will have a permanent place on Bad Daddy’s menu. As foodies at heart, our operators are focused on cooking up unique, indulgent burger builds, coupled with an inviting and engaging experience that differentiates Bad Daddy’s from others in casual dining and delivers on the value expectations of our guests.”

 

                                                           

1 Same store sales are a metric used in evaluating the performance of established restaurants and is a commonly used metric in the restaurant industry. Same store sales for our brands are calculated using all units open for at least 18 full fiscal months and use the comparable operating weeks from the prior year to the current year quarter’s operating weeks. 

 

  1  

 

“In addition to our concept-level initiatives, we have continued to focus on a multi-faceted approach to creating value, including share repurchases. In addition to our share repurchase program, during the quarter we completed a privately negotiated share repurchase bringing the total shares repurchased during the quarter to approximately 264,000 shares. At the same time, the cash generated by the business enabled us to complete that purchase, continue reinvesting in our restaurants, reduce our already limited borrowings on our credit facility, with sequential quarterly growth in ending cash reserves. I believe our operations and capabilities leaders are focused on creating enjoyable and memorable experiences for our guests through excellent restaurant operations and authentic, genuine hospitality, and that in doing so, we grow the value of our brands and operations for our shareholders.” Zink concluded.

 

Conference Call: Management will host a conference call to discuss its third quarter 2024 financial results on Thursday, August 1, 2024 at 3:00 p.m. MT/5:00 p.m. ET. Hosting the call will be Ryan M. Zink, its Chief Executive Officer and Keri A. August, its Senior Vice President of Finance and Accounting.

 

The conference call can be accessed live over the phone by dialing (888) 210-2831, conference ID: 3024033. The conference call will also be webcast live from the Company's corporate website www.goodtimesburgers.com. An archive of the webcast will be available at the same location on the corporate website shortly after the call has concluded.

 

Good Times Restaurants Inc. (Nasdaq: GTIM)

 

Good Times Restaurants Inc. owns, operates, and licenses 41 Bad Daddy’s Burger Bar restaurants through its wholly owned subsidiaries. Bad Daddy’s Burger Bar is a full-service “small box” restaurant concept featuring a chef-driven menu of gourmet signature burgers, chopped salads, appetizers and sandwiches with a full bar and a focus on a selection of craft beers in a high-energy atmosphere that appeals to a broad consumer base. Additionally, through its wholly owned subsidiaries, Good Times Restaurants Inc. owns, operates and franchises 31 Good Times Burgers & Frozen Custard restaurants primarily in Colorado. Good Times is a regional quick-service concept featuring 100% all-natural burgers and chicken sandwiches, signature wild fries, green chili breakfast burritos and fresh frozen custard desserts.

 

Forward Looking Statements

 

This press release contains forward looking statements within the meaning of federal securities laws. The words “intend,” “may,” “believe,” “will,” “should,” “anticipate,” “expect,” “seek”, “plan” and similar expressions are intended to identify forward looking statements. These statements involve known and unknown risks, which may cause the Company’s actual results to differ materially from results expressed or implied by the forward-looking statements. Such risks and uncertainties include, among other things, the market price of the Company's stock prevailing from time to time, the nature of other investment opportunities presented to the Company, the disruption to our business from pandemics and other public health emergencies, the impact and duration of staffing constraints at our restaurants, the impact of supply chain constraints and the current inflationary environment, the uncertain nature of current restaurant development plans and the ability to implement those plans and integrate new restaurants, delays in developing and opening new restaurants because of weather, local permitting or other reasons, increased competition, cost increases or shortages in raw food products, other general economic and operating conditions, risks associated with the acquisition of additional restaurants, the adequacy of cash flows and the cost and availability of capital or credit facility borrowings to provide liquidity, changes in federal, state, or local laws and regulations affecting the operation of our restaurants, including minimum wage and tip credit regulations, and other matters discussed under the Risk Factors section of Good Times’ Annual Report on Form 10-K for the fiscal year ended September 26, 2023 filed with the SEC, and other filings with the SEC.

 

GOOD TIMES RESTAURANTS INC.CONTACTS:

 

Ryan M. Zink, Chief Executive Officer (303) 384-1432

Christi Pennington (303) 384-1440

 

Category: Financial

 

  2  

 

Good Times Restaurants Inc.

Unaudited Supplemental Information

(In thousands, except per share amounts)

 

    Quarter Ended (13 weeks)     Year-to-Date (39 weeks)  
    June 25, 2024     June 27, 2023     June 25, 2024     June 27, 2023  
NET REVENUES:                                
Restaurant sales   $ 37,742     $ 35,376     $ 105,953     $ 103,123  
Franchise revenues     200       256       568       706  
Total net revenues     37,942       35,632       106,521       103,829  
                                 
RESTAURANT OPERATING COSTS:                                
Food and packaging costs     11,698       10,923       32,624       32,185  
Payroll and other employee benefit costs     12,635       11,940       36,525       35,477  
Restaurant occupancy costs     2,580       2,432       7,698       7,318  
Other restaurant operating costs     5,195       4,811       15,028       14,129  
Pre-opening costs     -       80       -       110  
Depreciation and amortization     960       919       2,813       2,740  
Total restaurant operating costs     33,068       31,105       94,688       91,959  
                                 
General and administrative costs     2,680       2,377       7,791       7,070  
Advertising costs     749       751       2,665       2,423  
Impairment of long-lived assets     199       965       199       1,041  
Loss (gain) on restaurant and equipment asset sale     18       (10 )     12       (32 )
Litigation contingencies     -       -       (332 )     -  
                                 
INCOME FROM OPERATIONS:     1,228       444       1,498       1,368  
                                 
Interest and other expense, net     (27 )     (18 )     (101 )     (56 )
                                 
NET INCOME BEFORE INCOME TAXES:     1,201       426       1,397       1,312  
                                 
Provision for income taxes     197       551       198       10,503  
                                 
NET INCOME:     1,398       977       1,595       11,815  
Income attributable to non-controlling interests     (77 )     (135 )     (212 )     (479 )
                                 
NET INCOME ATTRIBUTABLE TO COMMON SHAREHOLDERS   $ 1,321     $ 842     $ 1,383     $ 11,336  
                                 
NET INCOME PER SHARE, ATTRIBUTABLE TO COMMON SHAREHOLDERS:                                
Basic   $ 0.12     $ 0.07     $ 0.12     $ 0.96  
Diluted   $ 0.12     $ 0.07     $ 0.12     $ 0.95  
                                 
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:                                
Basic     10,933,758       11,700,044       11,149,181       11,853,441  
Diluted     11,034,487       11,769,286       11,246,353       11,910,491  

 

  3  

 

Good Times Restaurants Inc.

Unaudited Supplemental Information

(In thousands)

 

Balance Sheet Data   June 25, 2024     September 26, 2023  
Cash and cash equivalents   $ 4,819     $ 4,182  
                 
Current assets   $ 7,709     $ 6,521  
                 
Total assets   $ 90,077     $ 91,088  
                 
Current liabilities   $ 16,543     $ 14,890  
                 
Shareholders’ equity   $ 33,018     $ 32,994  

 

Supplemental Information for Company-Owned Restaurants (dollars in thousands):

 

    Bad Daddy’s Burger Bar     Good Times Burgers & Frozen Custard  
    Third Quarter
 (13 weeks)
    Year-to-Date (39 weeks)     Third Quarter
(13 weeks)
    Year-to-Date (39 weeks)  
    2024     2023     2024     2023     2024     2023     2024     2023  
Restaurant sales   $ 27,327     $ 26,085     $ 77,896     $ 77,592     $ 10,415     $ 9,291     $ 28,057     $ 25,531  
Restaurants open at beginning of period     40       39       40       40       25       23       25       23  
Restaurants opened or acquired during period     -       -       -       -       1       -       1       -  
Restaurants closed during period     -       -       -       1       -       -       -       -  
Restaurants open at period end     40       39       40       39       26       23       26       23  
                                                                 
Restaurant operating weeks     520.0       504.0       1560.0       1530.5       324.5       299.0       974.5       897.0  
                                                                 
Average weekly sales per restaurant   $ 52.6     $ 51.8     $ 49.9     $ 50.7     $ 32.1     $ 31.1     $ 28.8     $ 28.5  

 

  4  

 

Reconciliation of Non-GAAP Measurements to U.S. GAAP Results

 

Reconciliation of Non-GAAP Restaurant-Level Operating Profit to Income from Operations

(In thousands, except percentage data)

 

    Bad Daddy’s Burger Bar     Good Times Burgers & Frozen Custard     Good Times
Restaurants Inc.
 
    Quarter Ended (13 Weeks)  
    June 25, 2024     June 27, 2023     June 25, 2024     June 27, 2023     June 25,
2024
    June 27,
2023
 
Restaurant sales   $ 27,327       100.0 %   $ 26,085       100.0 %   $ 10,415       100.0 %   $ 9,291       100.0 %   $ 37,742     $ 35,376  
                                                                                 
Restaurant operating costs (exclusive of depreciation and amortization and preopening, shown separately below):                                                                                
Food and packaging costs     8,517       31.2 %     8,106       31.1 %     3,181       30.5 %     2,817       30.3 %     11,698       10,923  
Payroll and benefits costs     9,227       33.8 %     9,054       34.7 %     3,408       32.7 %     2,886       31.1 %     12,635       11,940  
Restaurant occupancy costs     1,727       6.3 %     1,700       6.5 %     853       8.2 %     732       7.9 %     2,580       2,432  
Other restaurant operating costs     3,945       14.4 %     3,750       14.4 %     1,250       12.0 %     1,061       11.4 %     5,195       4,811  
Restaurant-level operating profit   $ 3,911       14.3 %   $ 3,475       13.3 %   $ 1,723       16.5 %   $ 1,795       19.3 %   $ 5,634     $ 5,270  
                                                                                 
Franchise revenues                                                                     200       256  
Deduct - Other operating:                                                                                
Depreciation and amortization                                                                     960       919  
General and administrative                                                                     2,680       2,377  
Advertising costs                                                                     749       751  
Impairment of long-lived assets                                                                     199       965  
Loss (gain) on restaurant and equipment asset sales                                                                     18       (10 )
Pre-opening costs                                                                     -       80  
Total other operating                                                                     4,606       5,082  
                                                                                 
Income from operations                                                                   $ 1,228     $ 444  

 

Certain percentage amounts in the table above may not total due to rounding as well as the fact that restaurant operating costs are expressed as a percentage of restaurant revenues (as opposed to total revenues).

 

  5  

 

Reconciliation of Non-GAAP Measurements to U.S. GAAP Results

 

Reconciliation of Non-GAAP Restaurant-Level Operating Profit to Income (Loss) from Operations

(In thousands, except percentage data)

 

    Bad Daddy’s Burger Bar     Good Times Burgers & Frozen Custard     Good Times
Restaurants Inc.
 
    Year-to-Date Period Ended (39 weeks)  
    June 25, 2024     June 27, 2023     June 25, 2024     June 27, 2023     June 25,
2024
    June 27,
2023
 
Restaurant sales   $ 77,896       100.0 %   $ 77,592       100.0 %   $ 28,057       100.0 %   $ 25,531       100.0 %   $ 105,953     $ 103,123  
Restaurant operating costs (exclusive of depreciation and amortization, and preopening, shown separately below:                                                                                
Food and packaging costs     24,156       31.0 %     24,131       31.1 %     8,468       30.2 %     8,054       31.5 %     32,624       32,185  
Payroll and benefits costs     27,040       34.7 %     26,951       34.7 %     9,485       33.8 %     8,526       33.4 %     36,525       35,477  
Restaurant occupancy costs     5,188       6.7 %     5,124       6.6 %     2,510       8.9 %     2,194       8.6 %     7,698       7,318  
Other restaurant operating costs     11,421       14.7 %     11,084       14.3 %     3,607       12.9 %     3,045       11.9 %     15,028       14,129  
Restaurant-level operating profit   $ 10,091       13.0 %   $ 10,302       13.3 %   $ 3,987       14.2 %   $ 3,712       14.5 %   $ 14,078     $ 14,014  
                                                                                 
Franchise revenues                                                                     568       706  
Deduct - Other operating:                                                                                
Depreciation and amortization                                                                     2,813       2,740  
General and administrative                                                                     7,791       7,070  
Advertising costs                                                                     2,665       2,423  
Litigation contingencies                                                                     (332 )     -  
Impairment of long-lived assets                                                                     199       1,041  
Loss (gain) on restaurant and equipment asset sales                                                                     12       (32 )
Pre-opening costs                                                                     -       110  
Total other operating                                                                     13,148       13,352  
                                                                                 
Income from operations                                                                   $ 1,498     $ 1,368  

 

Certain percentage amounts in the table above may not total due to rounding as well as the fact that restaurant operating costs are expressed as a percentage of restaurant revenues (as opposed to total revenues).

 

  6  

 

The Company believes that restaurant-level operating profit is an important measure for management and investors because it is widely regarded in the restaurant industry as a useful metric by which to evaluate restaurant-level operating efficiency and performance. The Company defines restaurant-level operating profit to be restaurant revenues minus restaurant-level operating costs, excluding restaurant closures and impairment costs. The measure includes restaurant-level occupancy costs, which include fixed rents, percentage rents, common area maintenance charges, real estate and personal property taxes, general liability insurance and other property costs, but excludes depreciation. The measure excludes depreciation and amortization expense, substantially all of which is related to restaurant level assets, because such expenses represent historical sunk costs which do not reflect current cash outlay for the restaurants. The measure also excludes selling, general and administrative costs, and therefore excludes occupancy costs associated with selling, general and administrative functions, and pre-opening costs. The Company excludes restaurant closure costs as they do not represent a component of the efficiency of continuing operations. Restaurant impairment costs are excluded, because, like depreciation and amortization, they represent a non-cash charge for the Company’s investment in its restaurants and not a component of the efficiency of restaurant operations. Restaurant-level operating profit is not a measurement determined in accordance with generally accepted accounting principles (“GAAP”) and should not be considered in isolation, or as an alternative, to income from operations or net income as indicators of financial performance. Restaurant-level operating profit as presented may not be comparable to other similarly titled measures of other companies. The tables above set forth certain unaudited information for the current and prior year fiscal quarters and year-to-date periods for fiscal 2024 and fiscal 2023, expressed as a percentage of total revenues, except for the components of restaurant operating costs, which are expressed as a percentage of restaurant revenues.

 

Reconciliation of Net Loss to Non-GAAP Adjusted EBITDA (Thousands of US Dollars)

 

    Quarter Ended (13 weeks)     Year-to-Date (39 weeks)  
    June 25, 2024     June 27, 2023     June 25, 2024     June 27, 2023  
Adjusted EBITDA2:                                
Net Income, as reported   $ 1,321     $ 842     $ 1,383       11,336  
Depreciation and amortization     959       924       2,817       2,691  
Interest expense, net     27       18       101       56  
Provision for income taxes     (197 )     (551 )     (198 )     (10,503 )
EBITDA     2,110       1,233       4,103       3,580  
Preopening expense     -       80       -       110  
Non-cash stock-based compensation     28       15       106       104  
Asset Impairment     199       965       199       1,041  
GAAP rent-cash rent difference     (211 )     (135 )     (537 )     (450 )
Loss (gain) on restaurant and equipment asset sales     18       (10 )     12       (32 )
Litigation contingencies     -       -       (332 )     -  
Adjusted EBITDA   $ 2,144     $ 2,148     $ 3,551     $ 4,353  

 

Adjusted EBITDA is a supplemental measure of operating performance that does not represent and should not be considered as an alternative to net income or cash flow from operations, as determined by GAAP, and our calculation thereof may not be comparable to that reported by other companies. This measure is presented because we believe that investors' understanding of our performance is enhanced by including this non-GAAP financial measure as a reasonable basis for evaluating our ongoing results of operations.

 

Adjusted EBITDA is calculated as net income before interest expense, provision for income taxes and depreciation and amortization and further adjustments to reflect the additions and eliminations presented in the table above.

 

                                                           

2 Depreciation and amortization, the difference between GAAP rent and cash rent and the loss (gain) on restaurant and equipment asset sales have been reduced by any amounts attributable to non-controlling interests.

 

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Adjusted EBITDA is presented because: (i) we believe it is a useful measure for investors to assess the operating performance of our business without the effect of non-cash charges such as depreciation and amortization expenses and asset disposals, closure costs and restaurant impairments, and (ii) we use Adjusted EBITDA internally as a benchmark for certain of our cash incentive plans and to evaluate our operating performance or compare our performance to that of our competitors. The use of Adjusted EBITDA as a performance measure permits a comparative assessment of our operating performance relative to our performance based on our GAAP results, while isolating the effects of some items that vary from period to period without any correlation to core operating performance or that vary widely among similar companies. Companies within our industry exhibit significant variations with respect to capital structures and cost of capital (which affect interest expense and income tax rates) and differences in book depreciation of property, plant and equipment (which affect relative depreciation expense), including significant differences in the depreciable lives of similar assets among various companies. Our management believes that Adjusted EBITDA facilitates company-to-company comparisons within our industry by eliminating some of these foregoing variations. Adjusted EBITDA, as presented, may not be comparable to other similarly titled measures of other companies, and our presentation of Adjusted EBITDA should not be construed as an inference that our future results will be unaffected by excluded or unusual items.

 

 

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