News

Famous Dave's Q3 results: The bleeding is slowing

November 17, 2016

The third quarter financial results for Famous Dave's shows that the bleeding has slowed to some extent for the chain as the sales decline the company had been experienced appears to be letting up. For the quarter ending Oct. 2, revenue dropped 8.5 percent to $25.5 million, which is not as dismal a number as the chain's second-quarter 14-percent drop or 17-percent fall in the first quarter of this year. 

According to a news release, other highlights of the latest three-month period for the brand, include: 

• 1 percent drop in comparable sales for company-owned restaurants open more than two years, compared to a 9.1 decrease during the same time last year.   
• Flat franchise royalty revenue at $4.3 million, though four new franchise-operated restaurants have opened since this time last year, comparable sales decreased 3.8 percent.
• 40 basis point increase in restaurant-level operating margin at company-owned restaurants due largely to a year over year decline in labor and benefits costs partially offset by sales deleverage on operating expenses. 
• $4.1 million increase in general and administrative expenses increased to approximately $4.5 million for the third quarter as the result of a settlement agreement, franchise related costs and and stock-based compensation expense, partially offset by lower severance and travel costs.
• $3.6 million of asset impairment, estimated lease termination, and other closing costs in Q3, including $3.4 million of restaurant impairment charges, compared to $650,000 of asset impairment, estimated lease termination, and other closing costs for the same period last year.
• $2.4 million Q3 GAAP net loss from continuing operations compared to net income of $957,000 for the same period last year. 
• $44,000 adjusted net income from operations compared to last year's loss of  $71,000 for the same period.   
• $0.34 per basic share in GAAP net loss from continuing operations this quarter, compared to $0.14 income per diluted share for the period last year. 
• Adjusted net income from continuing operations per share was $0.01 per diluted share compared to a loss of $0.01 per basic share during the same period last year. 

"The board and management team continues to operate with a strong sense of urgency and focus on improved performance," CEO Mike Lister, said in a news release. "Having our company-owned restaurants post the best comparable sales performance in 12 quarters helps validate and energize our team’s commitment to the four key priorities of revitalizing sales and traffic, reducing costs, elevating organizational effectiveness, and rebuilding culture.

Collectively, the entire Brand is very excited at the opportunity to return Famous Dave’s of America to long term Famous performance."

Famous Dave's ended the quarter with 176 restaurants, including 37 company-owned restaurants and 139 franchise-operated restaurants, located in 32 states, the Commonwealth of Puerto Rico, Canada and the United Arab Emirates.