CHICAGO, Aug. 07, 2018 (GLOBE NEWSWIRE) -- Potbelly Corporation (NASDAQ: PBPB) today
reported financial results for the second fiscal quarter ended July 1, 2018.
Key highlights for the thirteen weeks ended July 1, 2018 compared to the thirteen weeks ended June 25, 2017
include:
- Total revenues increased 2.0% to $110.3 million from $108.1 million.
- Company-operated comparable store sales decreased 0.2%.
- Five new shops opened, including three company-operated shops and two franchised shops.
- GAAP net loss attributable to Potbelly Corporation was $0.4 million, inclusive of a $2.1 million impairment charge compared
to loss of $0.1 million, inclusive of a $3.3 million impairment charge. GAAP diluted loss per share remained at $0.01.
- Adjusted net income1 attributable to Potbelly Corporation increased 20.1% to $3.3 million from adjusted net income
of $2.7 million. Adjusted diluted EPS1 increased 18.2% to $0.13 from $0.11.
- EBITDA1 decreased 10.8% to $5.8 million from $6.5 million.
- Adjusted EBITDA1 decreased 2.6% to $11.5 million from $11.8 million.
Key highlights for the twenty-six weeks ended July 1, 2018 compared to the twenty-six weeks ended June 25,
2017 include:
- Total revenues increased 1.6% to $213.3 million from $209.8 million.
- Company-operated comparable store sales decreased 1.8%.
- Nine new shops opened, including five company-operated shops and four franchised shops.
- GAAP net loss attributable to Potbelly Corporation was $2.6 million, inclusive of a $4.1 million impairment charge compared
to net income of $0.5 million, inclusive of a $4.2 million impairment charge. GAAP diluted loss per share was $0.10 compared to
GAAP diluted EPS of $0.02.
- Adjusted net income1 attributable to Potbelly Corporation decreased 2.1% to $3.9 million from adjusted net income
of $4.0 million. Adjusted diluted EPS1 decreased 6.3% to $0.15 from $0.16.
- EBITDA1 decreased 35.8% to $9.0 million from $14.0 million.
- Adjusted EBITDA1 decreased 9.3% to $19.1 million from $21.0 million.
Alan Johnson, Chief Executive Officer and President of Potbelly Corporation, commented, “We are pleased with our performance in
the second quarter, where we delivered revenue of $110 million and adjusted EPS of $0.13. We are encouraged by the improvement in
our company-operated same store sales, which was nearly flat at -0.2%, and was driven by stronger traffic and higher check. The
positive trajectory of our comp trends confirms to me that we are effectively executing on our traffic building initiatives.”
Johnson, continued, “While we are encouraged by our performance through the first half of the year, we recognize that 2018 is a
transition year for Potbelly and there is still much work to be done. However, we have assembled the right leadership team and are
executing on the right strategies to effect a successful turnaround of the Company.”
2018 Outlook
For the full fiscal year of 2018, management currently expects:
- 22-26 total shop openings, including 10-12 company operated shop openings;
- Flat company-operated comparable store sales growth;
- An effective tax rate that is in a range of 24%-26%, excluding the impact of ASU 2016-09; and
- Adjusted diluted earnings per share to range from $0.37-$0.39.
Projected adjusted diluted earnings per share set forth above is a measure not recognized under GAAP. Please see “Non-GAAP
Financial Measures” below.
Conference Call
A conference call and audio webcast has been scheduled for 5:00 p.m. Eastern Time today to discuss these results. Details of the
conference call are as follows:
| |
|
|
| Date: |
|
Tuesday, August 7, 2018 |
| Time: |
|
5:00 p.m. Eastern Time |
| Dial-In #: |
|
877-407-0784 U.S. & Canada |
| |
|
201-689-8560 International |
| Confirmation code: |
|
13681292 |
Alternatively, the conference call will be webcast at www.potbelly.com on the “Investor Relations” webpage. For those unable to participate, an audio
replay will be available from 8:00 p.m. Eastern Time on Tuesday, August 7, 2018 through midnight Tuesday, August 14, 2018. To
access the replay, please call 844-512-2921 (U.S. & Canada) or 412-317-6671 (International) and enter confirmation code
13681292. A web-based archive of the conference call will also be available at the above website.
About Potbelly
Potbelly Corporation is a neighborhood sandwich concept offering toasty warm sandwiches, signature salads and other fresh menu
items served by engaging people in an environment that reflects the Potbelly brand. Our Vision is for our customers to feel that we
are their “Neighborhood Sandwich Shop” and to tell others about their great experience. Our Mission is to make people really happy
and to improve every day. Our Passion is to be “The Best Place for Lunch.” The Company owns and operates over 400 shops in the
United States and our franchisees operate over 50 shops domestically, in the Middle East, Canada and India. For more information,
please visit our website at www.potbelly.com.
Definitions
The following definitions apply to these terms as used throughout this press release:
- Revenues – represents net company-operated sandwich shop sales and our franchise operations. Net
company-operated shop sales consist of food and beverage sales, net of promotional allowances and employee meals. Franchise
royalties and fees consist of an initial franchise fee, a franchise development agreement fee and royalty income from the
franchisee.
- Company-operated comparable store sales – represents the change in year-over-year sales for the comparable
company-operated store base open for 15 months or longer.
- EBITDA – represents income before depreciation and amortization expense, interest expense and the provision
for income taxes.
- Adjusted EBITDA – represents income before depreciation and amortization expense, interest expense and the
provision for income taxes, adjusted to eliminate the impact of other items, including certain non-cash as well as other items
that we do not consider representative of our ongoing operating performance.
- Adjusted net income – represents net income, excluding impairment, gain or loss on the disposal of property
and equipment and store closure expense, as well as other items that we do not consider representative of our ongoing operating
performance.
- Shop-level profit – represents income from operations less franchise royalties and fees, general and
administrative expenses, depreciation expense, pre-opening costs and impairment and loss on the disposal of property and
equipment.
- Shop-level profit margin – represents shop-level profit expressed as a percentage of net company-operated
sandwich shop sales.
- Adjusted diluted earnings per share – represents net income, excluding impairment, gain or loss on the
disposal of property and equipment and store closure expense on a fully diluted per share basis as well as other items that we do
not consider representative of our ongoing operating performance.
1Non-GAAP Financial Measures
We prepare our financial statements in accordance with Generally Accepted Accounting Principles (“GAAP”). Within this press
release, we make reference to EBITDA, adjusted EBITDA, adjusted net income, shop-level profit and shop-level profit margin, which
are non-GAAP financial measures. The Company includes these non-GAAP financial measures because management believes they are useful
to investors in that they provide for greater transparency with respect to supplemental information used by management in its
financial and operational decision making.
Management uses adjusted EBITDA and adjusted net income to evaluate the Company’s performance and in order to have comparable
financial results to analyze changes in our underlying business from quarter to quarter. Adjusted EBITDA and adjusted net income
exclude the impact of certain non-cash charges and other special items that affect the comparability of results in past quarters.
Management uses shop-level profit and shop-level profit margin as key metrics to evaluate the profitability of incremental sales at
our shops, to evaluate our shop performance across periods and to evaluate our shop financial performance against our
competitors.
Accordingly, the Company believes the presentation of these non-GAAP financial measures, when used in conjunction with GAAP
financial measures, is a useful financial analysis tool that can assist investors in assessing the Company’s operating performance
and underlying prospects. This analysis should not be considered in isolation or as a substitute for analysis of our results as
reported under GAAP. This analysis, as well as the other information in this press release, should be read in conjunction with the
Company’s financial statements and footnotes contained in the documents that the Company files with the U.S. Securities and
Exchange Commission. The non-GAAP financial measures used by the Company in this press release may be different from the methods
used by other companies. For more information on the non-GAAP financial measures, please refer to the table, “Reconciliation of
Non-GAAP Financial Measures to GAAP Financial Measures.”
This press release includes certain non-GAAP forward-looking information (including, but not limited to under the heading “2018
Outlook”), namely adjusted net income and adjusted diluted earnings per share. The Company believes that a quantitative
reconciliation of such forward-looking information to the most comparable financial measure calculated and presented in accordance
with GAAP cannot be made available without unreasonable efforts. A reconciliation of these non-GAAP financial measures would
require the Company to predict the timing and likelihood of outcomes that determine future impairments and the tax benefit of any
such future impairments. Neither of these measures, nor their probable significance, can be reliably quantified due to the
inability to forecast future impairments.
Forward-Looking Statements
In addition to historical information, this press release contains forward-looking statements within the meaning of Section 27A
of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended and the Private
Securities Litigation Reform Act of 1995. Forward-looking statements, written, oral or otherwise made, represent the Company’s
expectation or belief concerning future events. Without limiting the foregoing, the words “believes,” “expects,” “may,” “will,”
“should,” “seeks,” “intends,” “plans,” “strives,” “goal,” “estimates,” “forecasts,” “projects” or “anticipates” or the negative of
these terms and similar expressions are intended to identify forward-looking statements. Forward-looking statements may include,
among others, statements relating to: our future financial position and results of operations, business strategy, budgets,
projected costs and plans and objectives of management for future operations. By nature, forward-looking statements involve risks
and uncertainties that could cause actual results to differ materially from those projected or implied by the forward-looking
statement, due to reasons including, but not limited to, our ability to manage our growth and successfully implement our business
strategy; price and availability of commodities; changes in labor costs; consumer confidence and spending patterns; consumer
reaction to industry-related public health issues and perceptions of food safety; and weather conditions. In addition, there may be
other factors of which we are presently unaware or that we currently deem immaterial that could cause our actual results to be
materially different from the results referenced in the forward-looking statements. All forward-looking statements contained in
this press release are qualified in their entirety by this cautionary statement. Although we believe that our plans, intentions and
expectations are reasonable, we may not achieve our plans, intentions or expectations. Forward-looking statements are based on
current expectations and assumptions and currently available data and are neither predictions nor guarantees of future events or
performance. You should not place undue reliance on forward-looking statements, which speak only as of the date hereof. See “Risk
Factors” and “Cautionary Statement on Forward-Looking Statements” included in our most recent annual report on Form 10-K and other
risk factors described from time to time in subsequent quarterly reports on Form 10-Q, all of which are available on our website at
www.potbelly.com. The Company undertakes no obligation to publicly update or revise any
forward-looking statement as a result of new information, future events or otherwise, except as otherwise required by law.
| |
|
|
|
|
|
|
Potbelly Corporation
Consolidated Statements of Operations and Margin Analysis – Unaudited
(Amounts in thousands, except share and per share data) |
| |
|
|
|
|
|
|
| |
|
For the 13 Weeks
Ended |
|
|
For the 26 Weeks
Ended |
|
| |
|
July 1, |
|
|
% of |
|
|
June 25, |
|
|
% of |
|
|
July 1, |
|
|
% of |
|
|
June 25, |
|
|
% of |
|
| |
|
2018 |
|
|
Revenue |
|
|
2017 |
|
|
Revenue |
|
|
2018 |
|
|
Revenue |
|
|
2017 |
|
|
Revenue |
|
| Revenues |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Sandwich shop sales, net |
|
$ |
109,381 |
|
|
|
99.1 |
% |
|
$ |
107,382 |
|
|
|
99.3 |
% |
|
$ |
211,628 |
|
|
|
99.2 |
% |
|
$ |
208,241 |
|
|
|
99.2 |
% |
| Franchise royalties and fees |
|
|
966 |
|
|
|
0.9 |
|
|
|
754 |
|
|
|
0.7 |
|
|
|
1,636 |
|
|
|
0.8 |
|
|
|
1,594 |
|
|
|
0.8 |
|
| Total revenues |
|
|
110,347 |
|
|
|
100.0 |
|
|
|
108,136 |
|
|
|
100.0 |
|
|
|
213,264 |
|
|
|
100.0 |
|
|
|
209,835 |
|
|
|
100.0 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Sandwich shop operating expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Cost of goods sold, excluding depreciation |
|
|
28,639 |
|
|
|
26.0 |
|
|
|
28,635 |
|
|
|
26.5 |
|
|
|
55,275 |
|
|
|
25.9 |
|
|
|
55,298 |
|
|
|
26.4 |
|
| Labor and related expenses |
|
|
32,412 |
|
|
|
29.4 |
|
|
|
31,564 |
|
|
|
29.2 |
|
|
|
63,991 |
|
|
|
30.0 |
|
|
|
62,026 |
|
|
|
29.6 |
|
| Occupancy expenses |
|
|
14,985 |
|
|
|
13.6 |
|
|
|
14,269 |
|
|
|
13.2 |
|
|
|
29,711 |
|
|
|
13.9 |
|
|
|
28,438 |
|
|
|
13.6 |
|
| Other operating expenses |
|
|
12,793 |
|
|
|
11.6 |
|
|
|
12,252 |
|
|
|
11.3 |
|
|
|
25,293 |
|
|
|
11.9 |
|
|
|
23,885 |
|
|
|
11.4 |
|
| General and administrative expenses |
|
|
13,440 |
|
|
|
12.2 |
|
|
|
10,919 |
|
|
|
10.1 |
|
|
|
25,628 |
|
|
|
12.0 |
|
|
|
21,271 |
|
|
|
10.1 |
|
| Depreciation expense |
|
|
5,858 |
|
|
|
5.3 |
|
|
|
6,446 |
|
|
|
6.0 |
|
|
|
11,684 |
|
|
|
5.5 |
|
|
|
12,645 |
|
|
|
6.0 |
|
| Pre-opening costs |
|
|
68 |
|
|
|
0.1 |
|
|
|
546 |
|
|
|
0.5 |
|
|
|
136 |
|
|
|
0.1 |
|
|
|
619 |
|
|
|
0.3 |
|
| Impairment and loss on disposal of property and equipment |
|
|
2,057 |
|
|
|
1.9 |
|
|
|
3,341 |
|
|
|
3.1 |
|
|
|
4,081 |
|
|
|
1.9 |
|
|
|
4,226 |
|
|
|
2.0 |
|
| Total expenses |
|
|
110,252 |
|
|
|
99.9 |
|
|
|
107,972 |
|
|
|
99.8 |
|
|
|
215,799 |
|
|
|
101.2 |
|
|
|
208,408 |
|
|
|
99.3 |
|
| Income (loss) from operations |
|
|
95 |
|
|
|
0.1 |
|
|
|
164 |
|
|
|
0.2 |
|
|
|
(2,535 |
) |
|
|
(1.2 |
) |
|
|
1,427 |
|
|
|
0.7 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Interest expense |
|
|
28 |
|
|
* |
|
|
|
41 |
|
|
* |
|
|
|
55 |
|
|
* |
|
|
|
69 |
|
|
* |
|
| Income (loss) before income taxes |
|
|
67 |
|
|
|
0.1 |
|
|
|
123 |
|
|
|
0.1 |
|
|
|
(2,590 |
) |
|
|
(1.2 |
) |
|
|
1,358 |
|
|
|
0.6 |
|
| Income tax expense (benefit) |
|
|
302 |
|
|
|
0.3 |
|
|
|
186 |
|
|
|
0.2 |
|
|
|
(202 |
) |
|
|
(0.1 |
) |
|
|
739 |
|
|
|
0.4 |
|
| Net income (loss) |
|
|
(235 |
) |
|
|
(0.2 |
) |
|
|
(63 |
) |
|
|
(0.1 |
) |
|
|
(2,388 |
) |
|
|
(1.1 |
) |
|
|
619 |
|
|
|
0.3 |
|
| Net income attributable to non-controlling interest |
|
|
125 |
|
|
|
0.1 |
|
|
|
75 |
|
|
|
0.1 |
|
|
|
166 |
|
|
|
0.1 |
|
|
|
74 |
|
|
* |
|
| Net income (loss) attributable to Potbelly Corporation |
|
$ |
(360 |
) |
|
|
(0.3 |
)% |
|
$ |
(138 |
) |
|
|
(0.1 |
)% |
|
$ |
(2,554 |
) |
|
|
(1.2 |
)% |
|
$ |
545 |
|
|
|
0.3 |
% |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net income (loss) per common share attributable to common shareholders: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Basic |
|
$ |
(0.01 |
) |
|
|
|
|
|
$ |
(0.01 |
) |
|
|
|
|
|
$ |
(0.10 |
) |
|
|
|
|
|
$ |
0.02 |
|
|
|
|
|
| Diluted |
|
$ |
(0.01 |
) |
|
|
|
|
|
$ |
(0.01 |
) |
|
|
|
|
|
$ |
(0.10 |
) |
|
|
|
|
|
$ |
0.02 |
|
|
|
|
|
| Weighted average common shares outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Basic |
|
|
25,551,386 |
|
|
|
|
|
|
|
25,033,868 |
|
|
|
|
|
|
|
25,348,121 |
|
|
|
|
|
|
|
25,066,374 |
|
|
|
|
|
| Diluted |
|
|
25,551,386 |
|
|
|
|
|
|
|
25,033,868 |
|
|
|
|
|
|
|
25,348,121 |
|
|
|
|
|
|
|
25,981,051 |
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
_________________
| |
|
|
|
|
|
|
Potbelly Corporation
Reconciliation of Non-GAAP Financial Measures to GAAP Financial Measures – Unaudited
(Amounts in thousands, except share and per share data) |
| |
|
|
|
|
|
|
| |
|
For the 13 Weeks
Ended |
|
|
For the 26 Weeks
Ended |
|
| |
|
July 1, |
|
|
June 25, |
|
|
July 1, |
|
|
June 25, |
|
| |
|
2018 |
|
|
2017 |
|
|
2018 |
|
|
2017 |
|
| Net income (loss) attributable to Potbelly Corporation, as reported |
|
$ |
(360 |
) |
|
$ |
(138 |
) |
|
$ |
(2,554 |
) |
|
$ |
545 |
|
| Impairment, loss on disposal of property and equipment and
closures(1) |
|
|
2,514 |
|
|
|
3,440 |
|
|
|
5,112 |
|
|
|
4,376 |
|
| CEO transition costs(2) |
|
|
353 |
|
|
|
974 |
|
|
|
695 |
|
|
|
974 |
|
| Proxy related costs(3) |
|
|
93 |
|
|
|
— |
|
|
|
701 |
|
|
|
— |
|
| Restructuring costs(4) |
|
|
1,323 |
|
|
|
— |
|
|
|
1,323 |
|
|
|
— |
|
| Tax impact(5) |
|
|
(638 |
) |
|
|
(1,540 |
) |
|
|
(1,332 |
) |
|
|
(1,867 |
) |
| Adjusted net income attributable to Potbelly Corporation |
|
$ |
3,285 |
|
|
$ |
2,736 |
|
|
$ |
3,945 |
|
|
$ |
4,028 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net income (loss) attributable to Potbelly Corporation per share, basic |
|
$ |
(0.01 |
) |
|
$ |
(0.01 |
) |
|
$ |
(0.10 |
) |
|
$ |
0.02 |
|
| Net income (loss) attributable to Potbelly Corporation per share, diluted |
|
$ |
(0.01 |
) |
|
$ |
(0.01 |
) |
|
$ |
(0.10 |
) |
|
$ |
0.02 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Adjusted net income attributable to Potbelly Corporation per share, basic |
|
$ |
0.13 |
|
|
$ |
0.11 |
|
|
$ |
0.16 |
|
|
$ |
0.16 |
|
| Adjusted net income attributable to Potbelly Corporation per share, diluted |
|
$ |
0.13 |
|
|
$ |
0.11 |
|
|
$ |
0.15 |
|
|
$ |
0.16 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Shares used in computing adjusted net income attributable to Potbelly
Corporation: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Basic |
|
|
25,551,386 |
|
|
|
25,033,868 |
|
|
|
25,348,121 |
|
|
|
25,066,374 |
|
| Diluted |
|
|
26,146,928 |
|
|
|
25,880,705 |
|
|
|
26,010,846 |
|
|
|
25,981,051 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
For the 13 Weeks
Ended |
|
|
For the 26 Weeks
Ended |
|
| |
|
July 1, |
|
|
June 25, |
|
|
July 1, |
|
|
June 25, |
|
| |
|
2018 |
|
|
2017 |
|
|
2018 |
|
|
2017 |
|
| Net income (loss) attributable to Potbelly Corporation, as reported |
|
$ |
(360 |
) |
|
$ |
(138 |
) |
|
$ |
(2,554 |
) |
|
$ |
545 |
|
| Depreciation expense |
|
|
5,858 |
|
|
|
6,446 |
|
|
|
11,684 |
|
|
|
12,645 |
|
| Interest expense |
|
|
28 |
|
|
|
41 |
|
|
|
55 |
|
|
|
69 |
|
| Income tax expense (benefit) |
|
|
302 |
|
|
|
186 |
|
|
|
(202 |
) |
|
|
739 |
|
| EBITDA |
|
$ |
5,828 |
|
|
$ |
6,535 |
|
|
$ |
8,983 |
|
|
$ |
13,998 |
|
| Impairment, loss on disposal of property and equipment and
closures(1) |
|
|
2,514 |
|
|
|
3,440 |
|
|
|
5,112 |
|
|
|
4,376 |
|
| Stock-based compensation |
|
|
1,389 |
|
|
|
856 |
|
|
|
2,251 |
|
|
|
1,676 |
|
| CEO transition costs(2) |
|
|
353 |
|
|
|
974 |
|
|
|
695 |
|
|
|
974 |
|
| Proxy related costs(3) |
|
|
93 |
|
|
|
— |
|
|
|
701 |
|
|
|
— |
|
| Restructuring costs(4) |
|
|
1,323 |
|
|
|
— |
|
|
|
1,323 |
|
|
|
— |
|
| Adjusted EBITDA |
|
$ |
11,500 |
|
|
$ |
11,805 |
|
|
$ |
19,065 |
|
|
$ |
21,024 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
Potbelly Corporation
Reconciliation of Non-GAAP Financial Measures to GAAP Financial Measures – Unaudited
(Amounts in thousands, except selected operating data) |
| |
|
|
|
|
|
|
| |
|
For the 13 Weeks
Ended |
|
|
For the 26 Weeks
Ended |
|
| |
|
July 1, |
|
|
June 25, |
|
|
July 1, |
|
|
June 25, |
|
| |
|
2018 |
|
|
2017 |
|
|
2018 |
|
|
2017 |
|
| Income (loss) from operations |
|
$ |
95 |
|
|
$ |
164 |
|
|
$ |
(2,535 |
) |
|
$ |
1,427 |
|
| Less: Franchise royalties and fees |
|
|
966 |
|
|
|
754 |
|
|
|
1,636 |
|
|
|
1,594 |
|
| General and administrative expenses |
|
|
13,440 |
|
|
|
10,919 |
|
|
|
25,628 |
|
|
|
21,271 |
|
| Depreciation expense |
|
|
5,858 |
|
|
|
6,446 |
|
|
|
11,684 |
|
|
|
12,645 |
|
| Pre-opening costs |
|
|
68 |
|
|
|
546 |
|
|
|
136 |
|
|
|
619 |
|
| Impairment and loss on disposal of property and equipment |
|
|
2,057 |
|
|
|
3,341 |
|
|
|
4,081 |
|
|
|
4,226 |
|
| Shop-level profit [Y] |
|
$ |
20,552 |
|
|
$ |
20,662 |
|
|
$ |
37,358 |
|
|
$ |
38,594 |
|
| Total revenues |
|
$ |
110,347 |
|
|
$ |
108,136 |
|
|
$ |
213,264 |
|
|
$ |
209,835 |
|
| Less: Franchise royalties and fees |
|
|
966 |
|
|
|
754 |
|
|
|
1,636 |
|
|
|
1,594 |
|
| Sandwich shop sales, net [X] |
|
$ |
109,381 |
|
|
$ |
107,382 |
|
|
$ |
211,628 |
|
|
$ |
208,241 |
|
| Shop-level profit margin [Y÷X] |
|
|
18.8 |
% |
|
|
19.2 |
% |
|
|
17.7 |
% |
|
|
18.5 |
% |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
| |
|
For the 13 Weeks
Ended |
|
For the 26 Weeks
Ended |
| |
|
July 1, |
|
June 25, |
|
July 1, |
|
June 25, |
| |
|
2018 |
|
2017 |
|
2018 |
|
2017 |
| Selected Operating Data |
|
|
|
|
|
|
|
|
| Shop Activity: |
|
|
|
|
|
|
|
|
| Company-operated shops, end of period |
|
436 |
|
424 |
|
436 |
|
424 |
| Franchise shops, end of period |
|
58 |
|
54 |
|
58 |
|
54 |
| Revenue Data: |
|
|
|
|
|
|
|
|
| Company-operated comparable store sales |
|
(0.2)% |
|
(4.9)% |
|
(1.8)% |
|
(4.0)% |
| |
|
|
|
|
|
|
|
|
|
|
|
|
Footnotes to the Press Release, Reconciliation of Non-GAAP Financial Measures to GAAP Financial
Measures
& Selected Operating Data
(1) This adjustment includes costs related to impairment of long-lived assets, loss on disposal of property and equipment and
shop closure expenses. Shop closure expenses are recorded in general and administrative expenses in the consolidated statement of
operations.
(2) As a result of the departure of the former CEO, the Company incurred certain costs related to the transition. Transition costs
were included in general and administrative expenses in the consolidated statements of operations and were related to the
accelerated vesting of share-based compensation awards, salary related charges in accordance with the former CEO’s employment
agreement and various other transition costs.
(3) The Company incurred certain professional fees related to the shareholder proxy matter. These costs were included in general
and administrative expenses in the consolidated statements of operations.
(4) The Company incurred certain restructuring costs that were included in general and administrative expenses in the consolidated
statements of operations.
(5) For the thirteen and twenty-six weeks ended July 1, 2018 and June 25, 2017, the tax impact associated with adjustments to net
income is based on effective tax rates of 23.0% and 34.9%, respectively, partially offset by the impact of ASU
2016-09.
