News

FAT Brands reports Q1 sales increase

May 11, 2018

Fatburger and Buffalo's Express reported this week that Q1 same-store domestic sales grew 9.6, while system-wide, same-store increased 6.3 percent for the 13-week period ended April 1, 2018.

"First quarter results provided a strong start to 2018, with particularly impressive momentum at our flagship Fatburger brand, where same-store sales grew 6.3 percent, inclusive of 2.1 percent transaction growth," Andy Wiederhorn, president and CEO of FAT Brands, parent company of both brands said. "Results continue to be driven by successful co-branding with Buffalo's Express, increases in delivery, and the strong reception to the plant-based Impossible Burger. 

During the quarter, the brand also made progress in integrating Ponderosa and Bonanza into the FAT Brands platform, said Wiederhorn, who oversaw the purchase of both brands in 2017.

"We have stabilized Ponderosa and Bonanza same-store sales, reduced the overhead required to support the brand going forward, and rejuvenated the existing franchisee base with new marketing and operational initiatives," he said. "Additionally, we have taken significant steps towards closing the previously announced acquisition of Hurricane Grill & Wings."

Wiederhorn expects to complete the acquisition in the next 30 days. 

"Pro forma for this acquisition, and after full integration of anticipated synergies, we continue to expect to achieve an annualized revenue run-rate of over $18.5 million, and an annualized EBITDA run-rate of $11 million, or $1.10 per share, beginning in the third quarter of 2018," he said.

FAT Brands — formed as a Delaware corporation on March 21, 2017, as a wholly owned subsidiary of Fog Cutter Capital Group Inc. — has a strong foundation with a highly scalable platform, Wiederhorn said. 

"The financing we are securing will facilitate future acquisitions of strong brands with long track records of sustainable operating performance and steady cash flows," he said. "FAT Brands is poised for growth." 

Widerhorn is keynoting the Restaurant Franchising and Innovation Summit, July 16-18 in London. Register here.

Q1 2018 highlights

• Total revenues of $3.6 million.
• EBITDA of $940,000.
• Net income of $509,000, or $0.05 per share

Q1 segment performance
 

Fatburger & Buffalo's Express

• Same-store sales growth in core domestic market of 9.6 percent.
• System-wide same-store sales growth of 6.3 percent.
• Total revenues of $2 million.
• EBITDA of $851,000.
• Net income of $705,000.
• Two store openings.

Buffalo's Cafe

• System-wide same-store sales growth of (0.9 percent).
• Total revenue of $457,000.
• EBITDA of $103,000.
• Net income of $180,000.
• One store opening.

Ponderosa & Bonanza Steakhouse

• System-wide same-store sales growth of 1.2 percent.
• Total revenue of $1.1 million.
• EBITDA of $210,000.
• Net income of $166,000