SeniorFAT BrandsExecutivesAppointed to Lead Global Restaurant Franchising Company
LOS ANGELES, May 01, 2023 (GLOBE NEWSWIRE) — FAT (Fresh. Authentic. Tasty.) Brands Inc. announces Ken Kuick and Rob Rosen as Co-CEOs, effective May 5, 2023. As previously announced, Andy Wiederhorn will step down as CEO and continue in his role as Chairman of the Board, where he will focus on the strategic direction of the company, the allocation of capital, and ensuring the management team executes the Company’s business plan while maintaining quality restaurant operations.
Joining FAT Brands in 2021, Mr. Kuick, Chief Financial Officer, and Mr. Rosen, Executive Vice President of Capital Markets, have both played an integral role in the growth of the Company with a focus on strategic growth initiatives, including acquisitions and driving company profitability. Mr. Kuick and Mr. Rosen will also continue in their respective roles as Chief Financial Officer and Executive Vice President of Capital Markets while assuming the Co-CEO role. Together, they will focus on driving forward the Company’s overarching goals of increasing organic growth through new store openings, growing the utilization of its manufacturing facility, and bolstering the success of high-growth brands, including Twin Peaks.
Mr. Kuick’s past roles include Chief Financial Officer, Noodles & Company, Chief Accounting Officer, VICI Properties, and Chief Accounting Officer, Caesars Entertainment Operating Company, a subsidiary of Caesars Entertainment. Mr. Rosen is a Wall Street veteran with over 30 years of experience in structured finance, banking, lending, and portfolio management. Mr. Rosen has held positions at Fleet Bank, Kidder Peabody, and Bank of Tokyo, and has 20 years of experience with Black Diamond Capital Management in a variety of management, board-level, and advisory capacities.
“Over the last few years, Ken and Rob have played a tremendous role in the unprecedented growth of FAT Brands,” said Andy Wiederhorn, CEO of FAT Brands. “Their financial acumen and track record for hitting key company benchmarks make them well-positioned to take on the CEO role together. I look forward to continuing to work with Ken and Rob in the Chairman of the Board position to aid in the continued success of FAT Brands.”
“Andy is a great leader and I’m extremely humbled to take on this new responsibility and drive forward the key goals of the company,” said Ken Kuick, Chief Financial Officer of FAT Brands. “We are fortunate to have such a talented team at FAT Brands and I see great opportunity ahead in building upon our positioning as one of the largest restaurant companies in the U.S.”
“I’m honored to take on the Co-CEO position of a company that continues to surpass growth expectations,” said Rob Rosen, Executive Vice President of Capital Markets at FAT Brands. “In the near term, Ken and I will look to build on the strong foundation FAT Brands has already laid, which includes our robust growth pipeline, exciting innovations, and a commitment to our franchisees and customers.”
FAT Brands (NASDAQ: FAT) is a leading global franchising company that strategically acquires, markets, and develops fast casual, quick-service, casual dining, and polished casual dining concepts around the world. The Company currently owns 17 restaurant brands: Round Table Pizza, Fatburger, Marble Slab Creamery, Johnny Rockets, Fazoli’s, Twin Peaks, Great American Cookies, Hot Dog on a Stick, Buffalo’s Cafe & Express, Hurricane Grill & Wings, Pretzelmaker, Elevation Burger, Native Grill & Wings, Yalla Mediterranean and Ponderosa and Bonanza Steakhouses, and franchises and owns over 2,300 units worldwide. For more information on FAT Brands, please visit www.fatbrands.com.
Forward Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements reflect expectations of FAT Brands Inc. (“we”, “our” or the “Company”) concerning future events and are subject to significant business, economic and competitive risks, uncertainties and contingencies, including but not limited to uncertainties surrounding the severity, duration and effects of the COVID-19 pandemic. These factors are difficult to predict and beyond our control, and could cause our actual results to differ materially from those expressed or implied in such forward-looking statements. We refer you to the documents that we file from time to time with the Securities and Exchange Commission, such as our reports on Form 10-K, Form 10-Q and Form 8-K, for a discussion of these and other factors. We undertake no obligation to update any forward-looking statement to reflect events or circumstances occurring after the date of this press release.
All-American Chain’s Famous Burgers and Shakes Now Available in United Arab Emirates’ Capital City
LOS ANGELES, April 27, 2023 (GLOBE NEWSWIRE) — FAT (Fresh. Authentic. Tasty.) Brands Inc. announces the opening of Johnny Rockets in the United Arab Emirates. Situated in the country’s bustling capital city, Abu Dhabi, the new restaurant marks the first brick-and-mortar opening for franchise partner, Kitopi, who has a master franchise agreement with the global restaurant franchising company to open 136 brick-and-mortar locations in addition to 70 ghost kitchens throughout the Middle East.
To date, FAT Brands’ concepts Fatburger, Johnny Rockets, Elevation Burger and Buffalo’s Express have opened in 15 of Kitopi’s existing ghost kitchens in the region. In the coming weeks, the franchise partner will also be opening another brick-and-mortar Johnny Rockets location in Dubai.
“Since announcing our partnership with Kitopi in 2021, we have been impressed with their ability to successfully open and operate our brands,” said Jake Berchtold, COO of FAT Brands’ Fast Casual Division. “Now, as they begin to open brick-and-mortar locations, we are thrilled to continue this growth journey with them. The Middle East is ripe with expansion opportunities, and we look forward to bringing burgers, shakes, fries, and fun to Abu Dhabi with Johnny Rockets.”
The first Johnny Rockets restaurant opened June 6, 1986, on the iconic Melrose Avenue in Los Angeles. Since that time, the chain’s timeless all-American brand has connected with customers across the U.S. and in 25 other countries around the globe. Guests visiting the all-new location can enjoy a classic Johnny Rockets’ meal, a juicy, cooked-to-order burger paired with crispy fries and a decadent, hand-spun shake.
The Abu Dhabi Johnny Rockets is located at 108 Al Murihiban Street, Khalifa City, Abu Dhabi, UAE and is open Monday through Friday, 11 a.m. to 11 p.m., and Saturday and Sunday, 11 a.m. to 12 a.m.
For more information or to find a Johnny Rockets near you, please visit www.johnnyrockets.com.
About FAT (Fresh. Authentic. Tasty.) Brands FAT Brands (NASDAQ: FAT) is a leading global franchising company that strategically acquires, markets, and develops fast casual, quick-service, casual dining, and polished casual dining concepts around the world. The Company currently owns 17 restaurant brands: Round Table Pizza, Fatburger, Marble Slab Creamery, Johnny Rockets, Fazoli’s, Twin Peaks, Great American Cookies, Hot Dog on a Stick, Buffalo’s Cafe & Express, Hurricane Grill & Wings, Pretzelmaker, Elevation Burger, Native Grill & Wings, Yalla Mediterranean and Ponderosa and Bonanza Steakhouses, and franchises and owns over 2,300 units worldwide. For more information on FAT Brands, please visit www.fatbrands.com.
About Johnny Rockets Founded in 1986 on Melrose Avenue in Los Angeles, Johnny Rockets is an iconic, world-renowned, hamburger restaurant franchise that offers high-quality, innovative menu items including Certified Angus Beef® cooked-to-order hamburgers, veggie burgers, chicken sandwiches, crispy fries, and rich, delicious hand-spun shakes and malts. With over 325 locations in over 25 countries around the globe, this dynamic, lifestyle, the brand offers friendly service in an upbeat atmosphere of relaxed, casual fun. For more information, visit www.johnnyrockets.com.
Forward Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements relating to the timing and performance of new store openings. Forward-looking statements reflect expectations of FAT Brands Inc. (“we”, “our” or the “Company”) concerning the future and are subject to significant business, economic and competitive risks, uncertainties and contingencies, including but not limited to uncertainties surrounding the severity, duration and effects of the COVID-19 pandemic. These factors are difficult to predict and beyond our control, and could cause our actual results to differ materially from those expressed or implied in such forward-looking statements. We refer you to the documents that we file from time to time with the Securities and Exchange Commission, such as our reports on Form 10-K, Form 10-Q and Form 8-K, for a discussion of these and other factors. We undertake no obligation to update any forward-looking statement to reflect events or circumstances occurring after the date of this press release.
Classic Burger Chain Broadens International Presence with Newest BengaluruLocation
LOS ANGELES, April 18, 2023 (GLOBE NEWSWIRE) — FAT (Fresh. Authentic. Tasty.) Brands Inc., parent company of Johnny Rockets and 16 other restaurant concepts, announces a new location in India at the Kempegowda International Airport in partnership with HMSHost. Located in Bengaluru, the capital city of Karnataka, the new Johnny Rockets serves the classic fare that put the brand on the map over 35 years ago, including juicy, made-to-order burgers and hand-spun shakes.
“Expanding Johnny Rockets’ presence in non-traditional venues continues to be a key growth objective for the brand,” said Jake Berchtold, COO of FAT Brands’ Fast Casual Division. “Strategically, we are pleased to spearhead this type of expansion in a country like India, where we see significant opportunity to build our footprint.”
“We are seeing exciting times in the air travel industry as the demand remains strong in both the domestic and international travel spaces,” said Jagvir Singh Rana, Managing Director, India and Middle East, HMSHost. “With increased travel and the opening of T2 at Bengaluru International Airport, guest expectations are sure to increase. By partnering with Johnny Rockets, we aim to not only give our guests varied food choices but also an experience they will cherish forever.”
The first Johnny Rockets restaurant opened June 6, 1986, on Melrose Avenue in Los Angeles. Since that time, the chain’s timeless all-American brand has connected with customers across the U.S. and in 25 other countries around the globe.
The Johnny Rockets team’s passion for delivering fresh, classic American fare is only equaled by their commitment to providing a superb guest experience. The new location’s menu includes cooked-to-order burgers, indulgent, hand-spun real ice cream shakes, crispy fries, halal chicken options and more.
The new Bengaluru Johnny Rockets is located at Kempegowda International Airport, Terminal 2, Devanhalli, Bengaluru, and is open from 2 a.m. to 12 a.m. daily.
FAT Brands (NASDAQ: FAT) is a leading global franchising company that strategically acquires, markets and develops fast casual, quick-service, casual and polished casual dining restaurant concepts around the world. The Company currently owns 17 restaurant brands: Round Table Pizza, Fatburger, Marble Slab Creamery, Johnny Rockets, Fazoli’s, Twin Peaks, Great American Cookies, Hot Dog on a Stick, Buffalo’s Cafe & Express, Hurricane Grill & Wings, Pretzelmaker, Elevation Burger, Native Grill & Wings, Yalla Mediterranean and Ponderosa and Bonanza Steakhouses, and franchises and owns over 2,300 units worldwide. For more information on FAT Brands, please visit www.fatbrands.com.
About Johnny Rockets Founded in 1986 on Melrose Avenue in Los Angeles, Johnny Rockets is a world-renowned international franchise that offers high-quality, innovative menu items including Certified Angus Beef® cooked-to-order hamburgers, veggie burgers, chicken sandwiches, crispy fries, and rich, delicious hand-spun shakes and malts. With over 325 locations in over 25 countries around the globe, this dynamic lifestyle brand offers friendly service and upbeat music contributing to the chain’s signature atmosphere of relaxed, casual fun.
FAT Brands (NASDAQ: FAT) is a leading global franchising company that strategically acquires, markets, and develops fast casual, quick-service, casual dining, and polished casual dining concepts around the world. The Company currently owns 17 restaurant brands: Round Table Pizza, Fatburger, Marble Slab Creamery, Johnny Rockets, Fazoli’s, Twin Peaks, Great American Cookies, Hot Dog on a Stick, Buffalo’s Cafe & Express, Hurricane Grill & Wings, Pretzelmaker, Elevation Burger, Native Grill & Wings, Yalla Mediterranean and Ponderosa and Bonanza Steakhouses, and franchises and owns over 2,300 units worldwide. For more information on FAT Brands, please visit www.fatbrands.com.
Joe Gomes, Managing Director – Generalist Analyst, Noble Capital Markets, Inc.
Joshua Zoepfel, Research Associate, Noble Capital Markets, Inc.
Refer to the full report for the price target, fundamental analysis, and rating.
Board Changes. Yesterday, FAT Brands announced a nearly wholesale change to its Board. We believe the changes were made in an effort to help separate the Company from the ongoing derivative lawsuits and the government investigation, as well as give the still to be appointed new CEO a “clean slate” to execute the business plan. In addition, FAT Brands elected “controlled company” status for purposes of the government governance rules. While always a controlled company, FAT Brands had previously elected to follow the “majority of independent directors” rule. The move to “controlled company” status could save the Company about $1 million per year.
The New Board. Of the former directors, only Andrew Wiederhorn and Lynne Collier remain. Additions to the Board include five insiders, including Mr. Wiederhorn’s three sons, all of whom hold leadership positions at FAT Brands, and three independent directors — Mark Elenowitz, Kenneth Kepp, and Tyler Child.
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*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision.
New 501(c)(3) Organization FormedtoFurtherUnite Communities in Which Restaurant Franchising Company Operates
LOS ANGELES, March 22, 2023 (GLOBE NEWSWIRE) — FAT (Fresh. Authentic. Tasty.) Brands Inc., a leading global franchising company that owns restaurant brands including Johnny Rockets, Fatburger, Round Table Pizza, Twin Peaks, Fazoli’s and 12 other concepts, is pleased to announce the official launch of its newly formed 501(c)(3) charitable organization, FAT Brands Foundation. Created to amplify the existing charitable efforts of its 17-brand portfolio, the foundation will partner with local non-profit organizations in areas in which FAT Brands has a presence to provide essential programs to help families and communities thrive.
“Giving back has always been a part of the FAT Brands DNA,” said Jessica Wiederhorn, President of FAT Brands Foundation and Head of Non-Traditional Sales and Partnerships at FAT Brands. “With our company continuing to grow in size, we wanted to take our charitable efforts to the next level by launching a new arm that more broadly supports our employees and customers’ beloved communities. We are excited to be officially live and to have the opportunity to become more engrained with local non-profits that are committed to making a positive impact in the markets where we operate. Our mission is wide-ranging so we can meaningfully serve each community on a local, specific level.”
The foundation was seeded with a $250,000 donation from FAT Brands upon its inception and will continue to receive support from its parent company to further the directive of the organization in the years to come. For non-profits interested in applying for a grant or for those interested in donating to the foundation, please visit www.fatbrands.com/foundation.
About FAT (Fresh. Authentic. Tasty.) Brands FAT Brands (NASDAQ: FAT) is a leading global franchising company that strategically acquires, markets, and develops fast casual, quick-service, casual dining, and polished casual dining concepts around the world. The Company currently owns 17 restaurant brands: Round Table Pizza, Fatburger, Marble Slab Creamery, Johnny Rockets, Fazoli’s, Twin Peaks, Great American Cookies, Hot Dog on a Stick, Buffalo’s Cafe & Express, Hurricane Grill & Wings, Pretzelmaker, Elevation Burger, Native Grill & Wings, Yalla Mediterranean and Ponderosa and Bonanza Steakhouses, and franchises and owns over 2,300 units worldwide.
AboutFAT Brands Foundation Founded in 2022, the FAT Brands Foundation was created to uplift and unite the communities in which FAT Brands operates. While the company’s 17-brand portfolio is deeply rooted in charitable initiatives both locally and nationally, FAT Brands, as an organization, is seeking to magnify those efforts further. The 501(c)(3) organization is aimed at partnering with local non-profit organizations to provide essential programs to help families and communities thrive.
FAT Brands (NASDAQ: FAT) is a leading global franchising company that strategically acquires, markets, and develops fast casual, quick-service, casual dining, and polished casual dining concepts around the world. The Company currently owns 17 restaurant brands: Round Table Pizza, Fatburger, Marble Slab Creamery, Johnny Rockets, Fazoli’s, Twin Peaks, Great American Cookies, Hot Dog on a Stick, Buffalo’s Cafe & Express, Hurricane Grill & Wings, Pretzelmaker, Elevation Burger, Native Grill & Wings, Yalla Mediterranean and Ponderosa and Bonanza Steakhouses, and franchises and owns over 2,300 units worldwide. For more information on FAT Brands, please visit www.fatbrands.com.
Joe Gomes, Managing Director – Generalist Analyst, Noble Capital Markets, Inc.
Joshua Zoepfel, Research Associate, Noble Capital Markets, Inc.
Refer to the full report for the price target, fundamental analysis, and rating.
Management Change. Yesterday after the market close, FAT Brands announced that its founder and CEO, Andy Wiederhorn, will transition to a new role as an outside consultant and strategic advisor to the Company effective May 5, 2023. Mr. Wiederhorn will remain a FAT Brands Board member and his family office, Fog Cutter Holdings LLC, will continue as the controlling shareholder of FAT Brands. The appointment of an interim CEO will be announced prior to the transition date, and Mr. Wiederhorn will continue as CEO until then.
Drivers. According to the Company, in transitioning from his role as CEO, Mr. Wiederhorn seeks to eliminate the distraction of the previously announced government investigation tied to him, and allow senior management to focus on continuing to drive shareholder value.
Equity Research is available at no cost to Registered users of Channelchek. Not a Member? Click ‘Join’ to join the Channelchek Community. There is no cost to register, and we never collect credit card information.
This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).
*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision.
Veteran Restaurant Executive Will Assume New Position as Outside Consultant and Strategic Advisor
LOS ANGELES, March 06, 2023 (GLOBE NEWSWIRE) — FAT (Fresh. Authentic. Tasty.) Brands Inc. announces that its founder and CEO, Andy Wiederhorn, will transition to a new role as an outside consultant and strategic advisor to the Company effective May 5, 2023. Mr. Wiederhorn will remain a FAT Brands Board member and his family office, Fog Cutter Holdings LLC, will continue as the controlling shareholder of FAT Brands. The appointment of an interim CEO will be announced prior to the transition date, and Mr. Wiederhorn will continue as CEO until then.
In his strategic advisory role, Mr. Wiederhorn will continue to support the management team and the Company while focusing his time on the Company’s long-term strategy and capital allocation plans. In transitioning from his role as CEO, Mr. Wiederhorn seeks to eliminate the distraction of the previously announced government investigation tied to him, and allow senior management to focus on continuing to drive shareholder value.
“While I will be stepping aside as CEO, I will continue to support the growth and evolution of FAT Brands, including championing our talented executive team, which has over the past five years taken the Company from two brands to 17 iconic restaurant brands with over 2,300 units and systemwide sales of $2.2 billion annually,” said FAT Brands CEO Andy Wiederhorn. “In 2022 we were named Public Company of the Year by the Los Angeles Business Journal, due in large part to the hard work and dedication of our corporate teams and franchise partners.”
About FAT (Fresh. Authentic. Tasty.) Brands FAT Brands (NASDAQ: FAT) is a leading global franchising company that strategically acquires, markets, and develops fast casual, quick-service, casual dining, and polished casual dining concepts around the world. The Company currently owns 17 restaurant brands: Round Table Pizza, Fatburger, Marble Slab Creamery, Johnny Rockets, Fazoli’s, Twin Peaks, Great American Cookies, Hot Dog on a Stick, Buffalo’s Cafe & Express, Hurricane Grill & Wings, Pretzelmaker, Elevation Burger, Native Grill & Wings, Yalla Mediterranean and Ponderosa and Bonanza Steakhouses, and franchises and owns over 2,300 units worldwide. For more information on FAT Brands, please visit www.fatbrands.com.
FAT Brands (NASDAQ: FAT) is a leading global franchising company that strategically acquires, markets, and develops fast casual, quick-service, casual dining, and polished casual dining concepts around the world. The Company currently owns 17 restaurant brands: Round Table Pizza, Fatburger, Marble Slab Creamery, Johnny Rockets, Fazoli’s, Twin Peaks, Great American Cookies, Hot Dog on a Stick, Buffalo’s Cafe & Express, Hurricane Grill & Wings, Pretzelmaker, Elevation Burger, Native Grill & Wings, Yalla Mediterranean and Ponderosa and Bonanza Steakhouses, and franchises and owns over 2,300 units worldwide. For more information on FAT Brands, please visit www.fatbrands.com.
Joe Gomes, Managing Director – Generalist Analyst, Noble Capital Markets, Inc.
Joshua Zoepfel, Research Associate, Noble Capital Markets, Inc.
Refer to the full report for the price target, fundamental analysis, and rating.
4Q22 Results. FAT Brands reported 4Q22 revenue of $103.8 million, up 39.9% y-o-y from $74.2 million in the year ago quarter. The increased revenue reflects the 2021 acquisitions and ongoing recovery from COVID impacts as SSS was up 2.7%. FAT reported adjusted EBITDA of $19.6 million in the quarter, down from $24.6 million in 3Q22. Net loss for the quarter was $70.8 million, or a loss of $4.29 per share, compared to a net loss of $19.6 million, or a loss of $1.38 per share, last year. We had projected revenue of $104.8 million and a net loss of $16.5 million, or a loss of $0.99 per share.
One-Time Items Impact. The quarter’s results were impacted by a number of one-time non-cash charges, including a $16.1 million non-cash reserve on employee retention credits, a $14 million non-cash trademark impairment charge, and a $20.4 million valuation allowance.
Equity Research is available at no cost to Registered users of Channelchek. Not a Member? Click ‘Join’ to join the Channelchek Community. There is no cost to register, and we never collect credit card information.
This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).
*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision.
LOS ANGELES, Feb. 22, 2023 (GLOBE NEWSWIRE) — FAT (Fresh. Authentic. Tasty.) Brands Inc. (NASDAQ: FAT) (“FAT Brands” or the “Company”) today reported fourth quarter and full year 2022 financial results for the fiscal year ended December 25, 2022.
Andy Wiederhorn, President and CEO of FAT Brands, commented, “The fourth quarter marked yet another strong performance for FAT Brands, as evidenced by our robust unit development and profitable revenue growth. After a very active acquisition strategy in 2021, I am particularly pleased with the momentum of our organic growth strategy during 2022.”
“With over 140 store openings during 2022, we achieved a new milestone for FAT Brands, including 44 that opened in the fourth quarter. We plan to continue this robust unit growth with between 150 and 175 units slated to open in 2023. We are seeing strong new franchisee activity as well as continued demand from existing franchise partners to develop other brands within our portfolio, which is very encouraging as we look beyond our current unit development pipeline of over 1,000 locations representing 60% EBITDA growth over the next several years.”
“We are extremely impressed with how our 2021 acquisitions have seamlessly fit into our portfolio and the demand we are experiencing for them from our franchisee base. In addition to our organic growth momentum, we will lean into the expansion of our high-growth brands, particularly our sports lodge category, and continue to expand our factory business.”
“We also continue to work on reducing our cost of capital and are pursuing strategies to significantly reduce our leverage ratio over the next 24 to 36 months.”
Fiscal FourthQuarter 2022Highlights
Total revenue improved 39.9% to $103.8 million compared to $74.2 million in the fourth quarter of 2021
System-wide sales growth of 22.1% in the fourth quarter of 2022 compared to the prior year quarter
Year-to-date system-wide same-store sales growth of 2.7% in the fourth quarter of 2022 compared to the prior year
44 new store openings during the fourth quarter of 2022 and over 140 openings during the year
Net loss of $70.8 million, or $4.29 per diluted share, compared to $19.6 million, or $1.38 per diluted share, in the fourth quarter of 2021
Adjusted EBITDA(1) of $19.6 million compared to $10.4 million in the fourth quarter of 2021
Adjusted net loss(1) of $43.0 million, or $2.60 per diluted share, compared to $16.5 million, or $1.16 per diluted share, in the fourth quarter of 2021
Fiscal Year 2022 Highlights
Total revenue increased 242.5% to $407.2 million compared to $118.9 million in 2021
System-wide sales growth of 108.0% compared to 2021
Year-to-date system-wide same-store sales growth of 6.0% in 2022 compared to 2021
Over 140 new store openings during 2022
Net loss of $126.2 million, or $7.66 per diluted share, compared to $31.6 million, or $2.15 per diluted share, in 2021
Adjusted EBITDA(1) of $88.8 million compared to $21.1 million 2021
Adjusted net loss(1) of $80.9 million, or $4.91 per diluted share, compared to $20.6 million, or $1.41 per diluted share, in 2021
(1) EBITDA, Adjusted EBITDA and adjusted net loss are non-GAAP measures defined below, under “Non-GAAP Measures”. Reconciliation of GAAP net loss to EBITDA, adjusted EBITDA and adjusted net loss are included in the accompanying financial tables.
Summary of Fourth Quarter 2022 Financial Results
Total revenue increased $29.6 million, or 39.9%, in the fourth quarter of 2022, to $103.8 million compared to $74.2 million in the same period of 2021. The increase reflects revenue from the acquisition of Twin Peaks in October 2021, the acquisitions of Fazoli’s and Native Grill & Wings in December 2021 (collectively, the “2021 Acquisitions”) and the continuing recovery from the negative effects of the COVID-19 pandemic on royalties from restaurant sales.
Costs and expenses increased $59.5 million, or 77.3%, in the fourth quarter of 2022 to $136.4 million compared to $77.0 million in the same period in the prior year, primarily due to the 2021 Acquisitions.
General and administrative expense increased $17.6 million, or 81.4%, in the fourth quarter of 2022 compared to the same period in the prior year, primarily due to the 2021 Acquisitions, increased compensation costs, professional fees related to pending litigation and government investigations, and travel, reflecting the significant expansion of the organization.
Cost of restaurant and factory revenues totaled $61.7 million in the fourth quarter of 2022 and was related to the operations of the company-owned restaurant locations and our dough factory associated with the 2021 Acquisitions.
Depreciation and amortization increased $1.6 million, or 30.6% in the fourth quarter of 2022 compared to the same period in the prior year, primarily due to depreciation of company-owned restaurant property and equipment and amortizing intangible assets related to the 2021 Acquisitions.
Refranchising losses in the fourth quarter of 2022 were $3.1 million and were comprised of restaurant costs and expenses, net of food sales. Refranchising losses in the fourth quarter of 2021 were $1.0 million and were comprised of $2.1 million restaurant operating costs, net of food sales, partially offset by $1.1 million in net gains related to refranchised restaurants.
Advertising expenses increased $1.6 million in the fourth quarter of 2022 compared to the prior year period. These expenses vary in relation to advertising revenues and reflect advertising expenses related to the 2021 Acquisitions and the increase in customer activity as the recovery from COVID continues.
Total other expense, net for the fourth quarters of 2022 and 2021 was $24.2 million and $17.1 million, respectively, primarily comprised of net interest expense of $25.6 million and $16.4 million, respectively.
Adjusted net loss was $43.0 million, or $2.60 per diluted share, in the fourth quarter of 2022 compared to $16.5 million, or $1.16 per diluted share, in the fourth quarter of 2021.
Key Financial Definitions
New store openings – The number of new store openings reflects the number of stores opened during a particular reporting period. The total number of new stores per reporting period and the timing of stores openings has, and will continue to have, an impact on our results.
Same-store sales growth – Same-store sales growth reflects the change in year-over-year sales for the comparable store base, which we define as the number of stores open and in the FAT Brands system for at least one full fiscal year. For stores that were temporarily closed, sales in the current and prior period are adjusted accordingly. Given our focused marketing efforts and public excitement surrounding each opening, new stores often experience an initial start-up period with considerably higher than average sales volumes, which subsequently decrease to stabilized levels after three to six months. Additionally, when we acquire a brand, it may take several months to integrate fully each location of said brand into the FAT Brands platform. Thus, we do not include stores in the comparable base until they have been open and in the FAT Brands system for at least one full fiscal year. For 2022, the comparable store base does not include concepts acquired during the fourth quarter of 2021.
System-wide sales growth – System wide sales growth reflects the percentage change in sales in any given fiscal period compared to the prior fiscal period for all stores in that brand only when the brand is owned by FAT Brands. Because of acquisitions, new store openings and store closures, the stores open throughout both fiscal periods being compared may be different from period to period.
Conference Call and Webcast
FAT Brands will host a conference call and webcast to discuss its fiscal fourth quarter 2022 financial results today at 5:00 PM ET. Hosting the conference call and webcast will be Andy Wiederhorn, President and Chief Executive Officer, and Ken Kuick, Chief Financial Officer.
The conference call can be accessed live over the phone by dialing 1-877-704-4453 from the U.S. or 1-201-389-0920 internationally. A replay will be available after the call until Wednesday, March 1, 2023, and can be accessed by dialing 1-844-512-2921 from the U.S. or 1-412-317-6671 internationally. The passcode is 13735781. The webcast will be available at www.fatbrands.com under the “Investors” section and will be archived on the site shortly after the call has concluded.
About FAT (Fresh. Authentic. Tasty.) Brands
FAT Brands (NASDAQ: FAT) is a leading global franchising company that strategically acquires, markets, and develops fast casual, quick-service, casual dining, and polished casual dining concepts around the world. The Company currently owns 17 restaurant brands: Round Table Pizza, Fatburger, Marble Slab Creamery, Johnny Rockets, Fazoli’s, Twin Peaks, Great American Cookies, Hot Dog on a Stick, Buffalo’s Cafe & Express, Hurricane Grill & Wings, Pretzelmaker, Elevation Burger, Native Grill & Wings, Yalla Mediterranean and Ponderosa and Bonanza Steakhouses and franchises and owns approximately 2,300 units worldwide. For more information, please visit www.fatbrands.com.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements relating to the future financial and operating results of the Company, estimates of future EBITDA, the timing and performance of new store openings, future reductions in cost of capital and leverage ratio, our ability to conduct future accretive acquisitions, our pipeline of new store locations, and the recovery of our business from the COVID-19 pandemic. Forward-looking statements generally use words such as “expect,” “foresee,” “anticipate,” “believe,” “project,” “should,” “estimate,” “will,” “plans,” “forecast,” and similar expressions, and reflect our expectations concerning the future. Forward-looking statements are subject to significant business, economic and competitive risks, uncertainties and contingencies, many of which are difficult to predict and beyond our control, which could cause our actual results to differ materially from the results expressed or implied in such forward-looking statements. We refer you to the documents that we file from time to time with the Securities and Exchange Commission, such as our reports on Form 10-K, Form 10-Q and Form 8-K, for a discussion of these and other risks and uncertainties that could cause our actual results to differ materially from our current expectations and from the forward-looking statements contained in this press release. We undertake no obligation to update any forward-looking statements to reflect events or circumstances occurring after the date of this press release.
Non-GAAP Measures (Unaudited)
This press release includes the non-GAAP financial measures of EBITDA, adjusted EBITDA and adjusted net loss.
EBITDA is defined as earnings before interest, taxes, and depreciation and amortization. We use the term EBITDA, as opposed to income from operations, as it is widely used by analysts, investors, and other interested parties to evaluate companies in our industry. We believe that EBITDA is an appropriate measure of operating performance because it eliminates the impact of expenses that do not relate to business performance. EBITDA is not a measure of our financial performance or liquidity that is determined in accordance with generally accepted accounting principles (“GAAP”), and should not be considered as an alternative to net income (loss) as a measure of financial performance or cash flows from operations as measures of liquidity, or any other performance measure derived in accordance with GAAP.
Adjusted EBITDA is defined as EBITDA (as defined above), excluding expenses related to acquisitions, refranchising gain or losses, impairment charges, and certain non-recurring or non-cash items that the Company does not believe directly reflect its core operations and may not be indicative of the Company’s recurring business operations.
Adjusted net loss is a supplemental measure of financial performance that is not required by or presented in accordance with GAAP. Adjusted net loss is defined as net loss plus the impact of adjustments and the tax effects of such adjustments. Adjusted net loss is presented because we believe it helps convey supplemental information to investors regarding our performance, excluding the impact of special items that affect the comparability of results in past quarters to expected results in future quarters. Adjusted net loss as presented may not be comparable to other similarly titled measures of other companies, and our presentation of adjusted net loss should not be construed as an inference that our future results will be unaffected by excluded or unusual items. Our management uses this non-GAAP financial measure to analyze changes in our underlying business from quarter to quarter based on comparable financial results.
Reconciliations of net loss presented in accordance with GAAP to EBITDA, adjusted EBITDA and adjusted net loss are set forth in the tables below.
The ultimate sports lodgecontinues toperformat a high level, opening ninenew restaurantsand landingfive major development agreements
DALLAS, Feb. 13, 2023 (GLOBE NEWSWIRE) — FAT (Fresh. Authentic. Tasty.) Brands Inc., parent company of Twin Peaks Restaurant and 16 other restaurant concepts, is pleased to announce another strong year for Twin Peaks. The leading sports lodge concept generated strong growth throughout 2022 in addition to landing top spots on several prestigious awards lists.
In total, the banner year saw Twin Peaks open nine new lodges, while also signing four new area development agreements (ADAs) to add 26 future lodges in the United States and one ADA in Mexico for an additional 32 lodges. These agreements are expected to allow the brand to surpass the monumental 100-restaurant milestone by spring of 2023.
“We’re proud of the work our teams put in to ensure that Twin Peaks stays at the forefront of the sports bar segment and the restaurant industry as a whole,” said CEO Joe Hummel, who was named one of the most influential restaurant CEOs by Nation’s Restaurant News in 2022.
Twin Peaks began 2022 with the opening of its third lodge in Mexico City and now has four locations south of the border. The brand enters 2023 with 95 locations across the United States and Mexico with an anticipated 18-20 additional restaurants opening in 2023 in Chattanooga, Tennessee; Greenwood, Indiana; Deer Valley, Arizona; Columbus, Ohio; Springfield, Missouri; as well as Daytona Beach and Jacksonville, Florida to begin the year.
The brand signed several domestic ADAs to expand its footprint, including eight locations across North Carolina with Music City Consulting, four locations in the Ohio River Valley with JEB Food Group and three restaurants in the Pittsburgh area with the Falcons Group. Twin Peaks also secured an agreement with Dos Montes Corp. to add seven locations in Chicago and its largest international ADA to date with its subsidiary, Operadora 2 Montes, for 32 lodges in Mexico.
Twin Peaks also scored a number of industry honors. It placed seventh in Nation’s Restaurant News’ “Top 10 Biggest Sports Bars” and ranked 107th among the publication’s “Top 500 Restaurant Chains.” Twin Peaks also earned additional recognition by being named to Entrepreneur’s “Top 500” list, Black Box’s “Top 5 Restaurant Brands,” and Restaurant Business’ “Top 500” list for 2022.
In addition to these accolades, Twin Peaks continues to level up the sports bar’s menu. Twin Peaks amplified its scratch-made kitchen in 2022 with new artisan Flatbreads, Crispy Mini Beef Tacos, a variety of Street Tacos made with in-house smoked meats, a hand-cut choice New York Strip Steak, and specially crafted dessert and shot pairings.
Twin Peaks wrapped up its banner year by joining several partners in local fundraising initiatives. From serving meals to those affected by Hurricane Ian in Florida to fundraising efforts to raise $10,000 for Warriors for Freedom in Oklahoma to various local toy drives and gifting Christmas trees to military families throughout the holidays, Twin Peaks staff gave its time and effort to help support those in need throughout the communities in which it operates.
Capping off the year was Twin Peaks’ partnership with two national nonprofit organizations. Twin Peaks supported the ALS Foundation with a systemwide campaign to raise $15,000 for the organization and hosted the Twin Peaks Annual Hero’s Golf Tournament that raised $100,000 for its military foundation, Tunnel to Towers.
As Twin Peaks looks forward to surpassing the 100-restaurant milestone, the award-winning brand also has more big things in store for 2023 with continued unit growth, exciting marketing promotions for Super Bowl Sunday and March Madness, and a focus on the continued evolution of its sports bar fare with the launch of its new craft cocktails and spirits menu. Guests can also expect an expansion of its premium barrel selects that include refined choices like Angel’s Envy and Stagg Jr. bourbon and Corazon Resposado Buffalo Trace tequila to go along with reimagined cocktails and a fresh batch of quality spirits.
FAT Brands (NASDAQ: FAT) is a leading global franchising company that strategically acquires, markets, and develops fast casual, quick-service, casual dining, and polished casual dining concepts around the world. The Company currently owns 17 restaurant brands: Round Table Pizza, Fatburger, Marble Slab Creamery, Johnny Rockets, Fazoli’s, Twin Peaks, Great American Cookies, Hot Dog on a Stick, Buffalo’s Cafe & Express, Hurricane Grill & Wings, Pretzelmaker, Elevation Burger, Native Grill & Wings, Yalla Mediterranean and Ponderosa and Bonanza Steakhouses, and franchises and owns over 2,300 units worldwide.
About Twin Peaks
Founded in 2005 in the Dallas suburb of Lewisville, Twin Peaks now has nearly 100 locations in the US and Mexico. Twin Peaks is the ultimate sports lodge featuring made-from-scratch food and the coldest beer in the business surrounded by scenic views and the latest in high-definition TVs. At every Twin Peaks, guests are immediately welcomed by a friendly Twin Peaks Girl and served up a menu made for MVPs. From its smashed and seared to order burgers to its in-house smoked brisket, pork and wings, guests can expect menu items capable of satisfying every appetite. To learn more about franchise opportunities, visit twinpeaksfranchise.com. For more information, visit twinpeaksrestaurant.com.
Forward Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements relating to the timing and performance of new store openings and growth in same-store sales. Forward-looking statements reflect expectations of management concerning the future and are subject to significant business, economic and competitive risks, uncertainties and contingencies, including but not limited to uncertainties surrounding the severity, duration and effects of the COVID-19 pandemic. These factors are difficult to predict and beyond our control, and could cause our actual results to differ materially from those expressed or implied in such forward-looking statements. We refer you to the documents that are filed from time to time by FAT Brands Inc. with the Securities and Exchange Commission, such as its reports on Form 10-K, Form 10-Q and Form 8-K, for a discussion of these and other factors. We undertake no obligation to update any forward-looking statement to reflect events or circumstances occurring after the date of this press release.
Global Restaurant FranchisingCompanyBuilds Upon 1,000 Unit Pipeline
LOS ANGELES, Feb. 06, 2023 (GLOBE NEWSWIRE) — FAT (Fresh. Authentic. Tasty.) Brands Inc., a leading global franchising company that owns a number of iconic restaurant brands, including Johnny Rockets, Fatburger, Round Table Pizza, Twin Peaks, Fazoli’s and 12 other concepts, announces it has experienced a historic year of growth, opening 142 new stores in 2022 and adding a total of 362 stores to its development pipeline which spans 29 states and 17 countries.
Leading the way in new store development amongst FAT Brands’ concepts was Fatburger and Buffalo’s Express with 86 stores, Fazoli’s with 61, Round Table Pizza with 56, and Twin Peaks with 50. Noteworthy franchise deals included a combined 80-store development agreement for 40 Fatburger and Buffalo’s Express locations and 40 Round Table Pizza restaurants in the state of Texas, a 32-store agreement for Twin Peaks in Mexico, and a10-store agreement for Johnny Rockets in Israel.
Other strategic deals included 10 Marble Slab Creamery locations in Egypt and a nine-store development deal for Fazoli’s in Phoenix, AZ. The record-breaking development activity by the company will also bring its iconic portfolio to highly anticipated areas, such as Fatburger arriving in Florida, Puerto Rico and Atlanta, GA, Fazoli’s landing in Louisiana and Dallas, TX, and Twin Peaks growing its presence in Chicago, IL.
“We are extremely proud of our organic growth and the performance of our team in 2022,” said Taylor Wiederhorn, Chief Development Officer of FAT Brands. “Franchisee interest was at an all-time high from both new and existing franchisees, which speaks volumes to our robust portfolio of brands that continue to deliver strong same-store sales and attract new fans around the globe. This year, we will remain focused on converting our over 1,000-unit pipeline into new stores, approximately 175 of which are set to open in 2023, along with continuing to fuel our long-term growth with additional development deals.”
FAT Brands (NASDAQ: FAT) is a leading global franchising company that strategically acquires, markets, and develops fast casual, quick-service, casual dining, and polished casual dining concepts around the world. The Company currently owns 17 restaurant brands: Round Table Pizza, Fatburger, Marble Slab Creamery, Johnny Rockets, Fazoli’s, Twin Peaks, Great American Cookies, Hot Dog on a Stick, Buffalo’s Cafe & Express, Hurricane Grill & Wings, Pretzelmaker, Elevation Burger, Native Grill & Wings, Yalla Mediterranean and Ponderosa and Bonanza Steakhouses, and franchises and owns over 2,300 units worldwide.
Forward Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements relating to the timing and performance of new store openings, area development agreements, and growth in same-store sales. Forward-looking statements reflect expectations of FAT Brands Inc. (“we”, “our” or the “Company”) concerning the future and are subject to significant business, economic and competitive risks, uncertainties and contingencies, including but not limited to uncertainties surrounding the severity, duration and effects of the COVID-19 pandemic. These factors are difficult to predict and beyond our control, and could cause our actual results to differ materially from those expressed or implied in such forward-looking statements. We refer you to the documents that we file from time to time with the Securities and Exchange Commission, such as our reports on Form 10-K, Form 10-Q and Form 8-K, for a discussion of these and other factors. We undertake no obligation to update any forward-looking statement to reflect events or circumstances occurring after the date of this press release.
FAT Brands (NASDAQ: FAT) is a leading global franchising company that strategically acquires, markets, and develops fast casual, quick-service, casual dining, and polished casual dining concepts around the world. The Company currently owns 17 restaurant brands: Round Table Pizza, Fatburger, Marble Slab Creamery, Johnny Rockets, Fazoli’s, Twin Peaks, Great American Cookies, Hot Dog on a Stick, Buffalo’s Cafe & Express, Hurricane Grill & Wings, Pretzelmaker, Elevation Burger, Native Grill & Wings, Yalla Mediterranean and Ponderosa and Bonanza Steakhouses, and franchises and owns over 2,300 units worldwide. For more information on FAT Brands, please visit www.fatbrands.com.
Joe Gomes, Managing Director – Generalist Analyst, Noble Capital Markets, Inc.
Joshua Zoepfel, Research Associate, Noble Capital Markets, Inc.
Refer to the full report for the price target, fundamental analysis, and rating.
Note Sale. In a January 31st 8-K filing, FAT Brands reported that on January 25, 2023, the Company completed the sale of an aggregate principal amount of $40 million of Series 2022-1 6.00% Fixed Rate Senior Secured Notes, Class A-2 issued by its special purpose, wholly-owned subsidiary, FAT Brands GFG Royalty I, LLC. The Class A-2 Notes were offered and sold to qualified institutional buyers.
Terms. Scheduled payments of principal and interest on the Notes are required to be made on a quarterly basis, in each case from amounts that are available for payment thereon under the Base Indenture. The legal final maturity of the Notes is July 22, 2051, but it is anticipated that, unless earlier prepaid to the extent permitted under the Indenture, the Notes will be repaid on July 25, 2023. If the Notes are not repaid or refinanced by the anticipated call date, additional interest equal to 1.0% per annum will accrue on each tranche of Notes. If the Notes have not been repaid or refinanced the by July 25, 2026, the additional interest accruing on the Class A-2 Notes will increase to a rate of 2.5% per annum.
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This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).
*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision.
FAT Brands (NASDAQ: FAT) is a leading global franchising company that strategically acquires, markets, and develops fast casual, quick-service, casual dining, and polished casual dining concepts around the world. The Company currently owns 17 restaurant brands: Round Table Pizza, Fatburger, Marble Slab Creamery, Johnny Rockets, Fazoli’s, Twin Peaks, Great American Cookies, Hot Dog on a Stick, Buffalo’s Cafe & Express, Hurricane Grill & Wings, Pretzelmaker, Elevation Burger, Native Grill & Wings, Yalla Mediterranean and Ponderosa and Bonanza Steakhouses, and franchises and owns over 2,300 units worldwide. For more information on FAT Brands, please visit www.fatbrands.com.
Joe Gomes, Senior Research Analyst, Noble Capital Markets, Inc.
Joshua Zoepfel, Research Associate, Noble Capital Markets, Inc.
Refer to the full report for the price target, fundamental analysis, and rating.
ICR Conference. FAT Brands CEO Andrew Wiederhorn and Executive Chairman James Neuhauser held a fireside chat at the ICR Conference in Orlando Monday. Three key points discussed were management’s goal to get to the 15th largest restaurant company by unit count from its current 25th largest ranking, lowering leverage over time, and narrowing the valuation gap.
New Builds Drive Unit Count Growth. FAT Brands’ pipeline remains strong, in excess of 1,000 units. Management expects some 175 locations to open in 2023. Notably, 100 are already under construction with another 30 in the permitting phase. Although inflation has driven costs construction higher, sales growth at locations is helping offset higher costs. Additional potential acquisitions will supplement organic growth.
Equity Research is available at no cost to Registered users of Channelchek. Not a Member? Click ‘Join’ to join the Channelchek Community. There is no cost to register, and we never collect credit card information.
This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).
*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision.
