Ark Restaurants Corp. (NASDAQ:ARKR) today reported financial
results for the first quarter ended December 30, 2017.
Total revenues for the three-month period ended December 30,
2017 were $39,352,000 versus $38,420,000 for the three months ended
December 31, 2016. The comparison of sales is skewed by New Year’s
Eve which did not fall in the just completed quarter but was
included in revenue in the December 2016 quarter. The December 2016
quarter included revenues of $1,496,000 from three restaurants that
did not operate during the December 2017 quarter. Also, during the
quarter ended December 30, 2017 the revenues from our two Oyster
House Restaurants were $2,388,000. The Oyster House properties, one
in Gulf Shores and one in Spanish Fort, AL, were acquired on
November 30, 2016. The December 2016 quarter included sales of
$707,000 from these two properties.
Company-wide same store sales increased 2.2% for the three-month
period ended December 30, 2017 compared to the same three month
period last year.
Restaurant operating income was $882,000 for the three-month
period ended December 30, 2017 versus $1,333,000 for the three
months ended December 31, 2016. The comparison of restaurant
operating income is skewed by New Year’s Eve which did not fall in
the just completed quarter but was included in revenue in the
December 2016 quarter.
The Company’s EBITDA, adjusted for non-cash stock option
expense, and non-controlling interests, for the three-month period
ended December 30, 2017 was $2,071,000 versus $4,102,000 during the
same three-month period last year. EBITDA for the December 2016
quarter included $1,637,000 which resulted from the recognition of
a gain in the prior year period in connection with the sale of the
real estate underlying our Rustic Inn, Jupiter, FL property.
Without this gain the comparative EBITDA for the December 2016
quarter would have been $2,465,000.
Net income for the three-month period ended December 30, 2017
was $1,627,000, or $0.47 per basic ($0.46 per diluted share)
compared to $1,734,000, or $0.51 per basic share ($0.49 per diluted
share), for the same three-month period last year.
On December 22, 2017, the 2017 Tax Cuts and Jobs Act (the “Tax
Act”) was enacted into law and the new legislation contains several
key tax provisions that affected us, including a reduction of the
corporate income tax rate to 21% effective January 1, 2018, among
others. We are required to recognize the effect of the tax law
changes in the period of enactment, such as determining the
transition tax, remeasuring our U.S. deferred tax assets and
liabilities, and reassessing the net realizability of our deferred
tax assets and liabilities. In December 2017, the Securities and
Exchange Commission (the “SEC”) staff issued Staff Accounting
Bulletin No. 118, Income Tax Accounting Implications of the Tax
Cuts and Jobs Act, which allows us to record provisional amounts
during a measurement period not to extend beyond one year of the
enactment date. As a result, income tax expense reported for the
first quarter ended December 30, 2017 was adjusted to reflect the
effects of the change in the tax law and resulted in a discrete
income tax benefit of approximately $1.2 million. While we were
able to make a reasonable estimate of the impact of the reduction
in the corporate tax rate, it may be affected by other analyses
related to the Tax Act.
Ark Restaurants owns and operates 20 restaurants and bars, 19
fast food concepts and catering operations primarily in New York
City, Florida, Washington, D.C., Las Vegas, NV and the gulf coast
of Alabama. Five restaurants are located in New York City, two are
located in Washington, D.C., five are located in Las Vegas, Nevada,
three are located in Atlantic City, New Jersey, one is located in
Boston, Massachusetts, two are located on the east coast of Florida
and two are located on the Gulf Coast of Alabama. The Las Vegas
operations include four restaurants within the New York-New York
Hotel & Casino Resort and operation of the hotel's room
service, banquet facilities, employee dining room and six food
court concepts; and one restaurant within the Planet Hollywood
Resort and Casino. In Atlantic City, New Jersey, the Company
operates a restaurant and a bar in the Resorts Atlantic City Hotel
and Casino and a restaurant in the Tropicana Hotel and Casino. The
operations at the Foxwoods Resort Casino consist of one fast food
concept. In Boston, Massachusetts, the Company operates a
restaurant in the Faneuil Hall Marketplace. The Florida operations
include the Rustic Inn in Dania Beach, Florida and Shuckers,
located in Jensen Beach and the operation of five fast food
facilities in Tampa, Florida and seven fast food facilities in
Hollywood, Florida, each at a Hard Rock Hotel and Casino operated
by the Seminole Indian Tribe at these locations. In Alabama, the
Company operates two Original Oyster Houses, one in Gulf Shores,
Alabama and one in Spanish Fort, Alabama.
Except for historical information, this news release contains
forward-looking statements, within the meaning of Section 27A of
the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934. These statements involve unknown risks, and
uncertainties that may cause the Company's actual results or
outcomes to be materially different from those anticipated and
discussed herein. Important factors that might cause such
differences are discussed in the Company's filings with the
Securities and Exchange Commission. The Company disclaims any
intention or obligation to update or revise any forward-looking
statements, whether as a result of new information, future events
or otherwise. Actual results could differ materially from those
anticipated in these forward-looking statements, if new information
becomes available in the future.
ARK RESTAURANTS CORP.
Consolidated
Statements of Income For the 13 week periods ended December
30, 2017 and December 31, 2016 (In Thousands,
Except per share amounts) 13 weeks ended 13 weeks
ended December 30, December 31,
2017
2016
TOTAL REVENUES
$ 39,352
$ 38,420 COST AND EXPENSES:
Food and beverage cost of sales 10,230 9,750 Payroll
expenses 13,710 12,956 Occupancy expenses 5,031 4,732 Other
operating costs and expenses 5,117 4,866 General and administrative
expenses 3,079 3,300 Depreciation and amortization
1,303 1,483
Total costs and expenses
38,470
37,087 RESTAURANT OPERATING INCOME 882
1,333 Gain on sale of Rustic Inn, Jupiter property
- 1,637
OPERATING INCOME
882
2,970 OTHER (INCOME) EXPENSE:
Interest (income) expense, net
219
5 Total other income, net
219 5 INCOME
BEFORE PROVISION (BENEFIT) FOR INCOME TAXES 663 2,965
Provision (benefit) for income taxes
(1,078
) 880 CONSOLIDATED
NET INCOME 1,741 2,085 Net (income) loss attributable to
non-controlling interests
(114 )
(351 ) NET INCOME
ATTRIBUTABLE TO ARK RESTAURANTS CORP.
$
1,627 $ 1,734
NET INCOME PER ARK RESTAURANTS CORP. COMMON SHARE: Basic
$ 0.47 $
0.51 Diluted
$ 0.46
$ 0.49 WEIGHTED
AVERAGE NUMBER OF COMMON SHARES OUTSTANDING: Basic
3,432 3,423 Diluted
3,549 3,507
EBITDA Reconciliation: Restaurant operating income $
882 $ 1,333 Other income (expense), net
(219
) (5 ) Restaurant
income before provision for income taxes 663 1,328 Gain on sale of
Rustic Inn, Jupiter property
-
1,637 Pre tax income $ 663 $ 2,965 Depreciation
and amortization 1,303 1,483 Interest expense, net
219 5 EBITDA (a)
$ 2,185 $
4,453 EBITDA adjusted for non-cash stock
option expense, and non-controlling interests: EBITDA (as defined)
(a) $ 2,185 $ 4,453 Net (income) loss attributable to
non-controlling interests
(114 )
(351 ) EBITDA, as adjusted
$ 2,071 $
4,102 (a) EBITDA is defined as
earnings before interest, taxes, depreciation and amortization and
cumulative effect of changes in accounting principle. Although
EBITDA is not a measure of performance or Company believes the use
of this non-GAAP financial measure enhances an overall
understanding of the Company's past financial performance as well
as providing useful information to the investor because of its
historical use by the Company as both a performance measure and
measure of liquidity, and the use of EBITDA by virtually all
companies in the restaurant sector as a measure of both performance
and liquidity. However, investors should not consider this measure
in isolation or as a substitute for net income (loss), operating
income (loss), cash flows from operating activities or any other
measure for determining the Company's operating performance or
liquidity that is calculated in accordance with GAAP, it may not
necessarily be comparable to similarly titled measures employed by
other companies. A reconciliation of EBITDA to the most comparable
GAAP financial measure, pre-tax income, is included above.
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version on businesswire.com: http://www.businesswire.com/news/home/20180212006213/en/
Ark Restaurants Corp.Robert Stewart, (212)
206-8800bstewart@arkrestaurants.com
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