For the fiscal quarter ended
- Revenues were
$29,330,000 , as compared to$31,471,000 during the thirteen weeks endedSeptember 24, 2017 ; - Adjusted EBITDA, as subsequently defined, was
$9,476,000 , as compared to$9,257,000 for the thirteen weeks endedSeptember 24, 2017 ; - Income before provision for income taxes was
$6,463,000 , as compared to$5,127,000 for the thirteen weeks endedSeptember 24, 2017 ; - Net income was
$4,484,000 , as compared to$3,120,000 for the thirteen weeks endedSeptember 24, 2017 ; and - Earnings per diluted share was
$1.06 per share, as compared to$0.74 per share for the thirteen weeks endedSeptember 24, 2017 .
For the twenty-six weeks ended
- Revenues were
$59,498,000 , as compared to$62,274,000 during the twenty-six weeks endedSeptember 24, 2017 ; - Adjusted EBITDA, as subsequently defined, was
$19,071,000 , as compared to$18,230,000 for the twenty-six weeks endedSeptember 24, 2017 ; - Income before provision for income taxes was
$12,982,000 , as compared to$9,970,000 for the twenty-six weeks endedSeptember 24, 2017 ; - Net income was
$9,279,000 , as compared to$6,042,000 for the twenty-six weeks endedSeptember 24, 2017 ; and - Earnings per diluted share was
$2.19 per share, as compared to$1.43 per share for the twenty-six weeks endedSeptember 24, 2017 .
The Company also reported the following:
- License royalties increased to
$13,844,000 during the twenty-six weeks endedSeptember 23, 2018 , as compared to$13,165,000 during the twenty-six weeks endedSeptember 24, 2018 . During the twenty-six weeks endedSeptember 23, 2018 , total royalties earned under theJohn Morrell & Co. , agreement increased 5.1% to$12,795,000 , as compared to$12,173,000 of royalties earned during the twenty-six weeks endedSeptember 24, 2017 .
- In the Branded Product Program, which features the sale of Nathan's hot dogs to the foodservice industry, income from operations increased by approximately
$297,000 to $5,261,000 for the twenty-six weeks endedSeptember 23, 2018 , as compared to$4,964,000 for the twenty-six weeks endedSeptember 24, 2017 . Sales were$31,855,000 in the current period, compared to sales of$36,067,000 during the prior-year period, while the volume of hot dogs sold by the Company decreased 6.3%. However, the sales and volume declines were mostly related to the use of a new re-distributor to temporarily service certain of our regular distributor customers. Excluding the effects of the re-distributors' purchases in both years, we estimate that customer shipments, increased by approximately 2.8% during the fiscal 2019 period. Our average selling price, which is partially correlated to the beef markets, decreased by approximately 7.2% compared to the year-earlier period.
- Sales from Company-operated restaurants were
$10,189,000 during the twenty-six weeks endedSeptember 23, 2018 , as compared to$10,555,000 during the twenty-six weeks endedSeptember 24, 2017 . Sales were negatively affected, especially at our twoConey Island locations, by exceptionally unfavorable weather conditions in theNortheastern United States , during April andAugust 2018 .
- Revenues from franchise operations were
$2,343,000 during the twenty-six weeks endedSeptember 23, 2018 , as compared to$2,487,000 during the twenty-six weeks endedSeptember 24, 2017 . Total royalties were$2,101,000 in the fiscal 2019 period as compared to$2,330,000 in the fiscal 2018 period. Total franchise fee income was$242,000 during the twenty-six weeks endedSeptember 23, 2018 , as compared to$157,000 during the twenty-six weeks endedSeptember 24, 2017 . Nine new franchised outlets opened during the twenty-six weeks endedSeptember 23, 2018 , including two international locations, and four Branded Menu Program outlets.
- During the twenty-six weeks ended
September 23, 2018 , we recordedAdvertising Fund revenue and expense in the amount of$1,267,000 in connection with the adoption of ASC 606.
- In
November 2017 , Nathan's refinanced its then-outstanding$135.0 million 10.000% Senior Secured Notes due 2020 by issuing$150.0 million 6.625% Senior Secured Notes due 2025. Nathan's lowered its interest expense by approximately$2,025,000 during the twenty-six weeks endedSeptember 23, 2018 as compared to the twenty-six weeks endedSeptember 24, 2017 .
- On
September 21, 2018 , we paid the$0.25 per share regular cash dividend that was declared by the Board of Directors effectiveAugust 3, 2018 to shareholders of record at the close of business onSeptember 10, 2018 .
- Effective
November 2, 2018 , the Board of Directors declared its quarterly cash dividend of$0.25 per share payable onDecember 14, 2018 to shareholders of record at the close of business onDecember 3, 2018 .
Certain Non-GAAP Financial Information:
In addition to disclosing results that are determined in accordance with Generally Accepted Accounting Principles in
The Company believes that EBITDA and Adjusted EBITDA are useful to investors to assist in assessing and understanding the Company's operating performance and underlying trends in the Company's business because EBITDA and Adjusted EBITDA are (i) among the measures used by management in evaluating performance and (ii) are frequently used by securities analysts, investors and other interested parties as a common performance measure.
EBITDA and Adjusted EBITDA are not recognized terms under US GAAP and should not be viewed as alternatives to net income or other measures of financial performance or liquidity in conformity with US GAAP. Additionally, our definitions of EBITDA and Adjusted EBITDA may differ from other companies. Analysis of results and outlook on a non-US GAAP basis should be used as a complement to, and in conjunction with, data presented in accordance with US GAAP.
About
Nathan's is a Russell 2000 Company that currently distributes its products in 50 states, the
Except for historical information contained in this news release, the matters discussed are forward looking statements that involve risks and uncertainties. Words such as "anticipate", "believe", "estimate", "expect", "intend", and similar expressions identify forward-looking statements, which are based on the current belief of the Company's management, as well as assumptions made by and information currently available to the Company's management. Among the factors that could cause actual results to differ materially include but are not limited to: the status of our licensing and supply agreements, including the impact of our supply agreement for hot dogs with
Nathan's Famous, Inc. |
||||||||||||||||||
(unaudited) |
||||||||||||||||||
Thirteen weeks ended |
Twenty-six weeks ended |
|||||||||||||||||
Sept. 23, 2018 |
Sept. 24, 2017 |
Sept. 23, 2018 |
Sept. 24, 2017 |
|||||||||||||||
Financial Highlights |
||||||||||||||||||
Total revenues |
$ 29,330,000 |
$ 31,471,000 |
$ 59,498,000 |
$ 62,274,000 |
||||||||||||||
Income from operations (a) |
$ 8,480,000 |
$ 8,734,000 |
$ 17,567,000 |
$ 17,184,000 |
||||||||||||||
Net income |
$ 4,484,000 |
$ 3,120,000 |
$ 9,279,000 |
$ 6,042,000 |
||||||||||||||
Income per share: |
||||||||||||||||||
Basic |
$ 1.07 |
$ 0.75 |
$ 2.22 |
$ 1.45 |
||||||||||||||
Diluted |
$ 1.06 |
$ 0.74 |
$ 2.19 |
$ 1.43 |
||||||||||||||
Weighted-average shares used in |
||||||||||||||||||
computing income per share: |
||||||||||||||||||
Basic |
4,188,000 |
4,179,000 |
4,187,000 |
4,178,000 |
||||||||||||||
Diluted |
4,231,000 |
4,212,000 |
4,229,000 |
4,213,000 |
||||||||||||||
Select Segment Information
Revenues |
||||||||||||||||||
Branded product program |
$15,410,000 |
$18,130,000 |
$31,855,000 |
$36,067,000 |
||||||||||||||
Product licensing |
5,746,000 |
5,764,000 |
13,844,000 |
13,165,000 |
||||||||||||||
Restaurant operations |
7,402,000 |
7,577,000 |
12,532,000 |
13,042,000 |
||||||||||||||
Corporate |
772,000 |
- |
1,267,000 |
- |
||||||||||||||
Total Revenues |
$29,330,000 |
$31,471,000 |
$59,498,000 |
$62,274,000 |
||||||||||||||
Income from operations (b) Branded product program Product licensing Restaurant operations Corporate (c) Income from operations (b)
|
$2,730,000 5,700,000 2,095,000 (2,045,000) $8,480,000
|
$2,692,000 5,719,000 2,335,000 (2,012,000) $8,734,000
|
$5,261,000 13,753,000 2,845,000 (4,292,000) $17,567,000
|
$4,964,000 13,075,000 3,230,000 (4,085,000) $17,184,000
|
||||||||||||||
(a) |
Excludes interest expense, interest income, and other income, net. |
(b) |
Excludes interest expense, interest income and other income, net which are managed centrally at the corporate level, and, accordingly, such items are not presented by segment since they are excluded from the measure of profitability reviewed by the Chief Operating Decision Maker. |
(c) |
Consists principally of administrative expenses not allocated to the operating segments such as executive management, finance, information technology, legal, insurance, corporate office costs, incentive compensation and compliance costs. |
Nathan's Famous, Inc. and Subsidiaries |
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Reconciliation of Net Income to EBITDA and Adjusted EBITDA |
||||||||||||||||||
Thirteen weeks ended |
Twenty-six weeks ended |
|||||||||||||||||
Sept. 23, 2018 |
Sept. 24, 2017 |
Sept. 23, 2018 |
Sept. 24, 2017 |
|||||||||||||||
(unaudited) |
(unaudited) |
|||||||||||||||||
EBITDA |
||||||||||||||||||
Net Income |
$ 4,484,000 |
$ 3,120,000 |
$ 9,279,000 |
$ 6,042,000 |
||||||||||||||
Interest Expense |
2,651,000 |
3,663,000 |
5,301,000 |
7,326,000 |
||||||||||||||
Provision for income taxes |
1,979,000 |
2,007,000 |
3,703,000 |
3,928,000 |
||||||||||||||
Depreciation and amortization |
339,000 |
367,000 |
684,000 |
735,000 |
||||||||||||||
EBITDA |
$ 9,453,000 |
$ 9,157,000 |
$ 18,967,000 |
$ 18,031,000 |
||||||||||||||
Adjusted EBITDA |
||||||||||||||||||
EBITDA |
$ 9,453,000 |
$ 9,157,000 |
$ 18,967,000 |
$ 18,031,000 |
||||||||||||||
Stock-based compensation |
23,000 |
100,000 |
104,000 |
199,000 |
||||||||||||||
Adjusted EBITDA |
$ 9,476,000 |
$ 9,257,000 |
$ 19,071,000 |
$ 18,230,000 |
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COMPANY
CONTACT: (516) 338-8500 ext. 229
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