BurgerFi International, Inc. (Nasdaq: BFI, BFIIW) (“BurgerFi” or
the “Company”), owner of one of the nation’s leading fast-casual
“better burger” dining concepts through the BurgerFi brand, and the
high-quality, casual dining pizza and wings concept under the name
Anthony’s Coal Fired Pizza & Wings (“Anthony’s”) brand, today
reported financial results for the second quarter ended July 3,
2023.
Highlights for the Second Quarter 2023
- Total revenue was $43.4 million in the second quarter 2023
compared to $45.3 million in the prior year period
- Consolidated systemwide sales decreased to $70.7 million
compared to $74.3 million in the prior period
- Same-store sales growth of 1% at
Anthony’s in the second quarter of 2023 compared to the prior
period
- Systemwide sales for BurgerFi
decreased (9)% to $38.8 million in the second quarter compared to
the prior period
- Systemwide same-store sales decrease of (10)% at BurgerFi in
the second quarter of 2023 compared to the prior period
- Opened three BurgerFi brand franchised restaurants in the
second quarter, five BurgerFi franchised locations year to date,
and expects to open an additional nine BurgerFi, including the
first dual-brand franchise location.
- Hourly turnover declined significantly at both brands, with
Anthony’s performing better than industry benchmarks, while
BurgerFi made considerable progress and is on track to achieve
similar improvements. Management turnover improved at BurgerFi,
approaching industry benchmarks.
- Consolidated food, beverage and paper expense margin improved
330 basis points compared to the prior period
- Consolidated restaurant-level operating expenses increased 50
basis points compared to the prior period
- Net loss decreased to $6.0 million, or $(0.24) per diluted
share, in the second quarter 2023 compared to net loss of $60.4
million or $(2.72) per diluted share compared to the prior
period
- Adjusted EBITDA1 of $2.0 million in the second quarter 2023
compared to $2.6 million in the prior period
Management Commentary
Carl Bachmann, Chief Executive Officer of
BurgerFi stated, “I am thrilled to have joined the BurgerFi
organization because I believe both Anthony’s and BurgerFi are high
quality brands with growth potential. My prior experience in
turnaround situations at pizza and burger concepts has given me a
deep understanding of how to help drive improvement and growth for
these businesses. I plan to use the same proven and successful
playbook here.”
Bachmann continued, “The Company’s quarterly
performance is indicative as to why I am here today as the new CEO,
providing what I believe is a significant opportunity for
investors. So much so that I invested heavily into BFI equity when
I started, so I am firmly aligned with our shareholders.
With only a little over a month on the job,
there is no question we can do better, as the challenges both
brands face are not new to the industry. To say that I have seen it
all before and prevailed is not a stretch. Importantly, we are
already experiencing better trends at Anthony’s, especially from
our northern restaurant locations. As we progress into fall, we
believe these positive trends will follow typical seasonality and
spread to our southern restaurant locations as well. At BurgerFi,
we have been focused on improving the products and customer
experience, with several initiatives expected to reach stores
during the second half of the year and directly address the biggest
challenges the brand faces today. Some of these include launching a
much-needed new crispy chicken and grilled chicken sandwiches and
improving the milk shakes. In both instances, we currently run
below industry average in terms of contribution, and combined
should have a meaningful impact to topline. Perhaps the most
important opportunity is in fixing the french fries, which
currently accounts for a large number of customer complaints and is
as simple as changing processes in the kitchen. The bottom line is
that we cannot accept performance like 2Q and are committed to
driving better results for all of our stakeholders. While we have
limited our comments on what we have in store to drive the
turnaround today, we do expect to provide a more detailed and
thoughtful update by third quarter earnings or earlier.“
Christopher Jones, Chief Financial Officer of
BurgerFi, added, “Like Carl, I am thrilled to be joining the
BurgerFi team, as I see great potential for the business and have
confidence in Carl and the BurgerFi team to lead the company to
increased profitability and investor returns. The path to improved
profitability is not a complex one. It will require improved
execution at the stores and from management along with improvements
on cost controls. Rewarding success when it’s earned while also
demanding accountability from all members of the team will be
central to this effort. Carl mentioned we are already seeing some
encouraging trends, as we are cautiously optimistic that restaurant
level margins will improve going forward, as we expect food costs
to remain a positive tail wind, at least for the third quarter and
into the fourth. Additionally, we expect Store Labor and Corporate
G&A to begin to improve throughout the remainder of the year,
assuming the economy remains stable and trends in hourly turnover
at both brands continue to improve. These trends are why we are
maintaining our full year financial guidance, while also guiding
towards the low end of the previously provided range. Importantly,
with new leadership in place, we have also started to see growing
interest from new and existing franchise partners as we look to
unlock the value of the Anthony’s brand with a franchise program
and reengage with the BurgerFi brand, all of which should lead to
increases in topline growth.”
Second Quarter 2023 Key
Metrics1 Summary
|
Consolidated |
|
Quarter Ended |
|
Six Months Ended |
(in thousands, except
for percentage data) |
July 3, 2023 |
|
June 30 , 20222 |
|
July 3, 2023 |
|
June 30 , 20222 |
Systemwide Restaurant Sales |
$ |
70,683 |
|
|
$ |
74,292 |
|
|
$ |
144,128 |
|
|
$ |
147,387 |
|
Systemwide Restaurant Sales
Growth |
(5 |
)% |
|
(2 |
)% |
|
(2 |
)% |
|
|
2 |
% |
Systemwide Restaurant
Same-Store Sales Growth |
(5 |
)% |
|
(3 |
)% |
|
(3 |
)% |
|
|
— |
% |
Corporate-Owned Restaurant
Sales |
$ |
40,808 |
|
|
$ |
42,058 |
|
|
$ |
84,117 |
|
|
$ |
84,035 |
|
Corporate-Owned Restaurant
Sales Growth |
(3 |
)% |
|
|
5 |
% |
|
|
— |
% |
|
|
9 |
% |
Corporate-Owned Restaurant
Same-Store Sales Growth |
(3 |
)% |
|
|
— |
% |
|
(1 |
)% |
|
|
4 |
% |
Franchise Restaurant
Sales |
$ |
29,875 |
|
|
$ |
32,233 |
|
|
$ |
60,010 |
|
|
$ |
63,352 |
|
Franchise Restaurant Sales
Growth |
(7 |
)% |
|
(9 |
)% |
|
(5 |
)% |
|
(6 |
)% |
Franchise Restaurant
Same-Store Sales Growth |
(8 |
)% |
|
(7 |
)% |
|
(5 |
)% |
|
(5 |
)% |
Digital Channel % of
Systemwide Sales |
|
31 |
% |
|
|
35 |
% |
|
|
32 |
% |
|
|
36 |
% |
|
Quarter Ended |
|
July 3, 2023 |
|
June 30, 2022 |
(in thousands, except
for percentage data) |
BurgerFi |
|
Anthony's |
|
BurgerFi |
|
Anthony's2 |
Systemwide Restaurant Sales |
$ |
38,823 |
|
|
$ |
31,860 |
|
|
$ |
42,452 |
|
|
$ |
31,840 |
|
Systemwide Restaurant Sales
Growth |
(9 |
)% |
|
|
— |
% |
|
(4 |
)% |
|
|
2 |
% |
Systemwide Restaurant
Same-Store Sales Growth |
(10 |
)% |
|
|
1 |
% |
|
(9 |
)% |
|
|
3 |
% |
Corporate-Owned Restaurant
Sales |
$ |
8,948 |
|
|
$ |
31,860 |
|
|
$ |
10,219 |
|
|
$ |
31,840 |
|
Corporate-Owned Restaurant
Sales Growth |
(12 |
)% |
|
|
— |
% |
|
|
17 |
% |
|
|
2 |
% |
Corporate-Owned Restaurant
Same-Store Sales Growth |
(15 |
)% |
|
|
1 |
% |
|
(14 |
)% |
|
|
3 |
% |
Franchise Restaurant
Sales |
$ |
29,875 |
|
|
N/A |
|
$ |
32,233 |
|
|
N/A |
Franchise Restaurant Sales
Growth |
(7 |
)% |
|
N/A |
|
(9 |
)% |
|
N/A |
Franchise Restaurant
Same-Store Sales Growth |
(8 |
)% |
|
N/A |
|
(7 |
)% |
|
N/A |
Digital Channel % of
Systemwide Sales |
|
31 |
% |
|
|
32 |
% |
|
|
34 |
% |
|
|
36 |
% |
|
Six Months Ended |
|
July 3, 2023 |
|
June 30, 2022 |
(in thousands, except
for percentage data) |
BurgerFi |
|
Anthony's |
|
BurgerFi |
|
Anthony's2 |
Systemwide Restaurant Sales |
$ |
79,123 |
|
|
$ |
65,005 |
|
|
$ |
83,012 |
|
|
$ |
64,375 |
|
Systemwide Restaurant Sales
Growth |
(5 |
)% |
|
|
1 |
% |
|
(1 |
)% |
|
|
7 |
% |
Systemwide Restaurant
Same-Store Sales Growth |
(6 |
)% |
|
|
2 |
% |
|
(6 |
)% |
|
|
8 |
% |
Corporate-Owned Restaurant
Sales |
$ |
19,112 |
|
|
$ |
65,005 |
|
|
$ |
19,660 |
|
|
$ |
64,375 |
|
Corporate-Owned Restaurant
Sales Growth |
(3 |
)% |
|
|
1 |
% |
|
|
17 |
% |
|
|
7 |
% |
Corporate-Owned Restaurant
Same-Store Sales Growth |
(11 |
)% |
|
|
2 |
% |
|
(11 |
)% |
|
|
8 |
% |
Franchise Restaurant
Sales |
$ |
60,010 |
|
|
N/A |
|
$ |
63,338 |
|
|
N/A |
Franchise Restaurant Sales
Growth |
(5 |
)% |
|
N/A |
|
(6 |
)% |
|
N/A |
Franchise Restaurant
Same-Store Sales Growth |
(5 |
)% |
|
N/A |
|
(8 |
)% |
|
N/A |
Digital Channel % of
Systemwide Sales |
|
31 |
% |
|
|
33 |
% |
|
|
35 |
% |
|
|
37 |
% |
1. |
Refer to “Key Metrics Definitions” and “About Non-GAAP Financial
Measures” sections below. |
|
|
2. |
Included within Systemwide Restaurant Sales Growth, Systemwide
Restaurant Same-Store Sales Growth, Corporate-Owned Restaurant
Sales Growth and Corporate-Owned Restaurant Same-Store Sales Growth
data presented above is information for Anthony's for the
respective periods in 2021 which is presented only for
informational purposes as Anthony's was not under common ownership
until November 2021, the date of acquisition. |
|
|
Second Quarter 2023 Financial
Results
Total revenue in the second quarter of 2023
decreased 4% to $43.4 million compared to $45.3 million in the
year-ago quarter, primarily driven by a decrease in same-store
sales at BurgerFi partially offset by the additional revenue from
new restaurants opened during the period and an increase in
same-store sales at Anthony’s. For the BurgerFi brand, same-store
sales decreased (15)% and (8)% in corporate-owned and franchised
locations, respectively. For the Anthony’s brand, same-store sales
for the second quarter increased 1% over the prior year period.
Restaurant-level operating expenses for the
second quarter of 2023 were $35.2 million compared to $36.2 million
in the second quarter of 2022. For the BurgerFi brand,
restaurant-level operating expenses, as a percentage of sales,
increased 500 basis points for the second quarter of 2023, compared
to the second quarter of 2022, primarily due to lower leverage on
sales. For the Anthony's brand, restaurant-level operating
expenses, as a percentage of sales, improved 60 basis points for
the second quarter of 2023, compared to the second quarter of 2022,
driven primarily by lower food, beverage and paper costs coupled
with a slight increase in same-store sales.
Net loss in the second quarter was $6.0 million
compared to a net loss of $60.4 million in the year-ago quarter,
primarily due to reduced impairment charges, lower general and
administrative expenses, lower depreciation and amortization
expenses, offset by higher restructuring costs and loss on change
in value of warrant liability.
Adjusted EBITDA in the second quarter of 2023
decreased $0.6 million to $2.0 million compared to $2.6 million in
the second quarter of 2022, driven by lost leverage on sales at
BurgerFi partially offset by higher same-store sales and lower food
costs at Anthony’s. See the definition of Adjusted EBITDA, a
financial measure that is a non-generally accepted accounting
principle in the United States (“GAAP”), and the reconciliation to
the most comparable GAAP measure below.
Restaurant Development
As of July 3, 2023, the Company operated and
franchised 174 total restaurants of which 114 were BurgerFi (27
corporate-owned and 87 franchised) and 60 were corporate-owned
Anthony’s. During the second quarter 2023, there were three
franchised BurgerFi restaurants opened, and one franchise
closure.
Year to date, BurgerFi opened five franchised
locations with an additional four franchised locations expected by
third quarter end. For the third quarter to date, the Company
closed two underperforming corporate stores, one Anthony’s and one
BurgerFi store, as we align our geographic footprint to better
serve our customers.
2023 Outlook
Management is updating its outlook for the
fiscal year 2023:
Management now believes that it will come in at
the low end of the previous stated guidance.
- Annual revenues of $175-180 million
- Consolidated low single-digit same-store sales growth for
corporate-owned locations
- 15-20 new franchised restaurants, including one new
Anthony's
- Adjusted EBITDA of $10-12 million
- Capital expenditures of approximately $2 million
Conference Call
The Company will hold a conference call today, August 16,
2023, at 8:30 a.m. Eastern time to discuss its second quarter 2023
results.
Date: Wednesday, August 16, 2023Time: 8:30 a.m. Eastern
timeToll-free dial-in number: 1-833-816-1403International dial-in
number: (412) 317-0496Conference ID: 10181664
Please call the conference telephone number 5-10
minutes prior to the start time. An operator will register your
name and organization.
The conference call will be broadcast live and
available for two weeks for replay on the Company’s Investor
Relations website at ir.burgerfi.com.
Key Metrics Definitions
The following definitions apply to the terms listed below:
“Systemwide Restaurant Sales” is presented as
informational data in order to understand the aggregation of
franchised stores sales, ghost kitchen and corporate-owned store
sales performance. Systemwide Restaurant Sales growth refers to the
percentage change in sales at all franchised restaurants, ghost
kitchens and corporate-owned restaurants in one period from the
same period in the prior year. Systemwide Restaurant Same-Store
Sales growth refers to the percentage change in sales at all
franchised restaurants, ghost kitchens, and corporate-owned
restaurants after 14 months of operations. See definition below for
“Same-Store Sales”.
“Corporate-Owned Restaurant Sales” represent the
sales generated only by corporate-owned restaurants.
Corporate-Owned Restaurant Sales growth refers to the percentage
change in sales at all corporate-owned restaurants in one period
from the same period in the prior year. Corporate-Owned Restaurant
Same-Store Sales growth refers to the percentage change in sales at
all corporate-owned restaurants after 14 months of operations.
These measures highlight the performance of existing
corporate-owned restaurants.
“Franchise Restaurant Sales” represent the sales generated only
by franchisee-owned restaurants and are not recorded as revenue,
however, the royalties based on a percentage of these franchise
restaurant sales are recorded as revenue. Franchise Restaurant
Sales growth refers to the percentage change in sales at all
franchised restaurants in one period from the same period in the
prior year. Franchise Restaurant Same-Store Sales growth refers to
the percentage change in sales at all franchised restaurants after
14 months of operations. These measures highlight the performance
of existing franchised restaurants.
“Same-Store Sales” is used to evaluate the
performance of our store base, which excludes the impact of new
stores and closed stores, in both periods under comparison. We
include a restaurant in the calculation of Same-Store Sales after
14 months of operations. A restaurant which is temporarily closed,
is included in the Same-Store Sales computation. A restaurant which
is closed permanently, such as upon termination of the lease, or
other permanent closure, is immediately removed from the Same-Store
Sales computation. Our calculation of Same-Store Sales may not be
comparable to others in the industry.
“Digital Channel” % of systemwide sales is used
to measure performance of our investments made in our digital
platform and partnerships with third party delivery partners. We
believe our digital platform capabilities are a vital element to
continuing to serve our customers and will continue to be a
differentiator for the Company as compared to some of our
competitors. Digital Channel as percentages of Systemwide
Restaurant Sales are indicative of the sales placed through our
digital platforms and the percentage of those digital sales when
compared to total sales at all our franchised and corporate-owned
restaurants.
“Adjusted EBITDA,” a non-GAAP measure, is
defined as net loss before goodwill impairment, lease termination
recovery, share-based compensation expense, depreciation and
amortization expense, interest expense (which includes accretion on
the value of preferred stock and interest accretion on related
party note), restructuring costs, merger, acquisition and
integration costs, legal settlements, store closure costs, loss
(gain) on change in value of warrant liability, income tax expense
(benefit) and (gain) loss on sale of assets.
Unless otherwise stated, Systemwide Restaurant
Sales, Systemwide Sales growth, and Same-Store Sales are presented
on a systemwide basis, which means they include franchise
restaurants and company-owned restaurants. Franchise restaurant
sales represent sales at all franchise restaurants and are revenues
to our franchisees. We do not record franchise sales as revenues;
however, our royalty revenues and brand royalty revenues are
calculated based on a percentage of franchise sales.
About BurgerFi International (Nasdaq: BFI,
BFIIW)
BurgerFi International, Inc. is a leading
multi-brand restaurant company that develops, markets, and acquires
fast-casual and premium-casual dining restaurant concepts around
the world, including corporate-owned stores and franchises.
BurgerFi International is the owner and franchisor of the two
following brands with a combined 174 locations.
BurgerFi. BurgerFi is among the nation’s
fast-casual better burger concepts with 114 BurgerFi restaurants
(87 franchised and 27 corporate-owned) as of July 3, 2023.
BurgerFi is chef-founded and committed to serving fresh,
all-natural and quality food at all locations, online and via
first-party and third-party deliveries. BurgerFi uses 100% American
Angus Beef with no steroids, antibiotics, growth hormones,
chemicals or additives. BurgerFi's menu also includes high-quality
Wagyu Beef Blend Burgers, Antibiotic and Cage-Free Chicken
offerings, Hand-Cut Sides, and Frozen Custard Shakes. BurgerFi was
named "The Very Best Burger" at the 2023 edition of the nationally
acclaimed SOBE Wine and Food Festival and “Best Fast Food Burger”
in USA Today’s 10Best 2023 Readers’ Choice Awards for its BBQ Rodeo
Burger, "Best Fast Casual Restaurant" in USA Today's 10Best 2023
Readers' Choice Awards for the third consecutive year, QSR
Magazine's Breakout Brand of 2020 and Fast Casual's 2021 #1 Brand
of the Year. In 2021, Consumer Reports awarded BurgerFi an “A Grade
Angus Beef” rating for the third consecutive year. To learn more
about BurgerFi or to find a full list of locations, please visit
www.burgerfi.com. Download the BurgerFi App on iOS or Android
devices for rewards and 'Like' or follow @BurgerFi on Instagram,
Facebook and Twitter. BurgerFi® is a Registered Trademark of
BurgerFi IP, LLC, a wholly-owned subsidiary of BurgerFi.
Anthony’s. Anthony’s was acquired by BurgerFi on
November 3, 2021 and is a premium pizza and wing brand that
operates 60 corporate-owned casual restaurant locations, as of
July 3, 2023. Known for serving fresh, never frozen and
quality ingredients, Anthony’s is centered around a 900-degree
coal-fired oven with menu offerings including “well-done” pizza,
coal-fired chicken wings, homemade meatballs, and a variety of
handcrafted sandwiches and salads. Anthony’s was named “The Best
Pizza Chain in America” by USA Today's Great American Bites and
“Top 3 Best Major Pizza Chain” by Mashed in 2021. To learn more
about Anthony’s, please visit www.acfp.com.
About Non-GAAP Projected Financial Measures
To supplement our consolidated financial
statements, which are prepared and presented in accordance with
GAAP, we use the measure Adjusted EBITDA. The presentation of this
financial information is not intended to be considered in isolation
or as a substitute for, or superior to, the financial information
prepared and presented in accordance with GAAP.
We use this non-GAAP financial measure for
financial and operational decision-making and as a means to
evaluate period-to-period comparisons. We believe that this
non-GAAP financial measure provides meaningful supplemental
information regarding our performance and liquidity by excluding
certain items that may not be indicative of our recurring core
business operating results. We believe that both management and
investors benefit from referring to this non-GAAP financial measure
in assessing our performance and when planning, forecasting, and
analyzing future periods. This non-GAAP financial measure also
facilitates management’s internal comparisons to our historical
performance and liquidity as well as comparisons to our
competitors’ operating results. We believe this non-GAAP financial
measure is useful to investors both because (1) it allows for
greater transparency with respect to key metrics used by management
in its financial and operational decision-making and (2) it is used
by our institutional investors and the analyst community to help
them analyze the health of our business.
There are a number of limitations related to the
use of this non-GAAP financial measure. We compensate for these
limitations by providing specific information regarding the GAAP
amounts excluded from this non-GAAP financial measure and
evaluating this non-GAAP financial measure together with its
relevant financial measures in accordance with GAAP.
A reconciliation of Adjusted EBITDA guidance is
not being provided due to the nature of this forward-looking
non-GAAP measure containing certain elements that are impractical
to predict given their market-based nature, such as share-based
compensation expense and gain and losses on change in value of
warrant liabilities, without unreasonable efforts. For the same
reasons, we are unable to address the probable significance of the
unavailable information, nor can we accurately predict all of the
components of the applicable non-GAAP financial measure and
reconciling adjustments thereto; accordingly, guidance for the
corresponding GAAP measure may be materially different than
guidance for the non-GAAP measure. Such forward looking information
is also subject to uncertainty and various risks, and there can be
no assurance that any forecasted results or conditions will
actually be achieved.
Forward-Looking Statements
This press release may contain “forward-looking
statements” as defined in the Private Securities Litigation Reform
Act of 1995, including statements relating to BurgerFi's estimates
of its future business outlook, liquidity, prospects or financial
results, long-term opportunities, executing on growth and
improvement strategies, new franchise opportunities, increased
revenue, liquidity, improved operating margins in both brands,
improved labor trends,, seasonality trends, product improvements,
including new products and services, store opening plans, and
expectations regarding adjusted EBITDA in 2023, as well as
statements set forth under the section titled “2023 Outlook” above.
Forward-looking statements generally can be identified by words
such as “anticipates,” “believes,” “estimates,” “expects,”
“intends,” “plans,” “predicts,” “projects,” “will be,” “will
continue,” “will likely result,” and similar expressions. These
forward-looking statements are based on current expectations and
assumptions that are subject to risks and uncertainties, which
could cause our actual results to differ materially from those
reflected in the forward-looking statements. Factors that could
cause or contribute to such differences include, but are not
limited to, those discussed in our Annual Report on Form 10-K for
the year ended January 2, 2023, and those discussed in other
documents we file with the Securities and Exchange Commission,
including our ability to continue to access liquidity from our
credit agreement and remain compliant with financial covenants
therein, as well as to successfully realize the expected benefits
of the acquisition of Anthony’s or any other factors. All
subsequent written and oral forward-looking statements attributable
to BurgerFi or persons acting on BurgerFi’s behalf are expressly
qualified in their entirety by the cautionary statements included
in this press release. We undertake no obligation to revise or
publicly release the results of any revision to these
forward-looking statements, except as required by law. Given these
risks and uncertainties, readers are cautioned not to place undue
reliance on such forward-looking statements.
Investor Relations:ICRMichelle
Michalski IR-BFI@icrinc.com646-277-1224
Company Contact:BurgerFi International
Inc.IR@burgerfi.com
Media Relations Contact:Ink Link MarketingKim
Miller Kmiller@inklinkmarketing.com
|
BurgerFi International Inc., and
SubsidiariesConsolidated Balance
Sheets |
|
|
Unaudited |
|
|
(in thousands, except
for per share data) |
July 3, 2023 |
|
January 2, 2023 |
Assets |
|
|
|
Current
Assets |
|
|
|
Cash |
$ |
10,711 |
|
|
$ |
11,917 |
|
Accounts receivable, net |
|
1,457 |
|
|
|
1,926 |
|
Inventory |
|
1,438 |
|
|
|
1,320 |
|
Assets held for sale |
|
1,527 |
|
|
|
732 |
|
Prepaid expenses and other current assets |
|
1,525 |
|
|
|
2,564 |
|
Total Current Assets |
$ |
16,658 |
|
|
$ |
18,459 |
|
Property & equipment,
net |
|
18,247 |
|
|
|
19,371 |
|
Operating right-of-use assets,
net |
|
45,565 |
|
|
|
45,741 |
|
Goodwill |
|
31,621 |
|
|
|
31,621 |
|
Intangible assets, net |
|
155,213 |
|
|
|
160,208 |
|
Other assets |
|
971 |
|
|
|
1,380 |
|
Total Assets |
$ |
268,275 |
|
|
$ |
276,780 |
|
Liabilities and
Stockholders' Equity |
|
|
|
Current
Liabilities |
|
|
|
Accounts payable - trade and other |
$ |
7,723 |
|
|
$ |
8,464 |
|
Accrued expenses |
|
8,381 |
|
|
|
10,589 |
|
Short-term operating lease liability |
|
12,274 |
|
|
|
9,924 |
|
Short-term borrowings, including finance leases |
|
3,485 |
|
|
|
4,985 |
|
Other current liabilities |
|
2,842 |
|
|
|
6,241 |
|
Total Current Liabilities |
$ |
34,705 |
|
|
$ |
40,203 |
|
Non-Current
Liabilities |
|
|
|
Long-term borrowings, including finance leases |
|
49,786 |
|
|
|
53,794 |
|
Redeemable preferred stock, $0.0001 par value, 10,000,000 shares
authorized, 2,120,000 shares issued and outstanding as of
July 3, 2023 and January 2, 2023, $53 million principal
redemption value, respectively |
|
53,482 |
|
|
|
51,418 |
|
Long-term operating lease liability |
|
40,889 |
|
|
|
40,748 |
|
Related party note payable |
|
14,412 |
|
|
|
9,235 |
|
Deferred income taxes |
|
1,223 |
|
|
|
1,223 |
|
Other non-current liabilities |
|
1,330 |
|
|
|
1,212 |
|
Total Liabilities |
$ |
195,827 |
|
|
$ |
197,833 |
|
Stockholders'
Equity |
|
|
|
Common stock, $0.0001 par
value, 100,000,000 shares authorized, 26,724,218, and 21,303,500
shares issued and outstanding as of July 3, 2023 and January
2, 2023, respectively |
|
2 |
|
|
|
2 |
|
Additional paid-in
capital |
|
314,749 |
|
|
|
306,096 |
|
Accumulated
deficit |
|
(242,303 |
) |
|
|
(227,151 |
) |
Total Stockholders'
Equity |
$ |
72,448 |
|
|
$ |
78,947 |
|
Total Liabilities and Stockholders' Equity |
$ |
268,275 |
|
|
$ |
276,780 |
|
|
BurgerFi International Inc., and
SubsidiariesConsolidated Statements of
Operations(Unaudited) |
|
|
Quarter Ended |
|
Six Months Ended |
(in thousands, except for per
share data) |
July 3,2023 |
|
June 30,2022 |
|
July 3,2023 |
|
June 30,2022 |
Revenue |
|
|
|
|
|
|
|
Restaurant sales |
$ |
40,808 |
|
|
$ |
42,236 |
|
|
$ |
84,124 |
|
|
|
84,592 |
|
Royalty and other fees |
|
2,190 |
|
|
|
2,611 |
|
|
|
4,160 |
|
|
|
4,714 |
|
Royalty - brand development and co-op |
|
429 |
|
|
|
451 |
|
|
|
870 |
|
|
|
922 |
|
Franchise Fees |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Total Revenue |
$ |
43,427 |
|
|
$ |
45,298 |
|
|
$ |
89,154 |
|
|
$ |
90,228 |
|
Restaurant level operating
expenses: |
|
|
|
|
|
|
|
Food, beverage and paper costs |
|
10,772 |
|
|
|
12,545 |
|
|
|
22,382 |
|
|
|
25,352 |
|
Labor and related expenses |
|
12,699 |
|
|
|
12,328 |
|
|
|
25,916 |
|
|
|
24,910 |
|
Other operating expenses |
|
7,760 |
|
|
|
7,421 |
|
|
|
15,216 |
|
|
|
14,613 |
|
Occupancy and related expenses |
|
3,930 |
|
|
|
3,890 |
|
|
|
7,763 |
|
|
|
7,725 |
|
General and administrative
expenses |
|
5,812 |
|
|
|
7,406 |
|
|
|
12,388 |
|
|
|
13,432 |
|
Depreciation and amortization
expense |
|
3,295 |
|
|
|
4,730 |
|
|
|
6,522 |
|
|
|
9,174 |
|
Share-based compensation
expense |
|
556 |
|
|
|
909 |
|
|
|
5,230 |
|
|
|
8,285 |
|
Brand development, co-op and
advertising expenses |
|
933 |
|
|
|
1,126 |
|
|
|
2,029 |
|
|
|
1,839 |
|
Goodwill and intangible asset
impairment |
|
— |
|
|
|
55,168 |
|
|
|
— |
|
|
|
55,168 |
|
Restructuring costs and other
charges, net |
|
1,135 |
|
|
|
52 |
|
|
|
2,174 |
|
|
|
1,040 |
|
Total Operating Expenses |
$ |
46,892 |
|
|
$ |
105,575 |
|
|
$ |
99,620 |
|
|
$ |
161,538 |
|
Operating
Loss |
|
(3,465 |
) |
|
|
(60,277 |
) |
|
|
(10,466 |
) |
|
|
(71,310 |
) |
Interest expense, net |
|
(2,211 |
) |
|
|
(2,246 |
) |
|
|
(4,289 |
) |
|
|
(4,317 |
) |
(Loss) gain on change in value
of warrant liability |
|
(318 |
) |
|
|
1,858 |
|
|
|
(391 |
) |
|
|
1,324 |
|
Other loss |
|
(5 |
) |
|
|
(47 |
) |
|
|
(5 |
) |
|
|
(80 |
) |
Loss before income
taxes |
$ |
(5,999 |
) |
|
$ |
(60,712 |
) |
|
$ |
(15,151 |
) |
|
$ |
(74,383 |
) |
Income tax (expense)
benefit |
|
(2 |
) |
|
|
335 |
|
|
|
(2 |
) |
|
|
447 |
|
Net loss |
$ |
(6,001 |
) |
|
$ |
(60,377 |
) |
|
$ |
(15,153 |
) |
|
$ |
(73,936 |
) |
Weighted average
common shares outstanding: |
|
|
|
|
|
|
|
Basic |
|
24,891,449 |
|
|
|
22,214,628 |
|
|
|
24,216,199 |
|
|
|
22,089,799 |
|
Diluted |
|
24,891,449 |
|
|
|
22,214,628 |
|
|
|
24,216,199 |
|
|
|
22,089,799 |
|
|
|
|
|
|
|
|
|
Net loss per common
share: |
|
|
|
|
|
|
|
Basic |
$ |
(0.24 |
) |
|
$ |
(2.72 |
) |
|
$ |
(0.63 |
) |
|
$ |
(3.35 |
) |
Diluted |
$ |
(0.24 |
) |
|
$ |
(2.72 |
) |
|
$ |
(0.63 |
) |
|
$ |
(3.35 |
) |
|
BurgerFi International Inc., and
SubsidiariesConsolidated Reconciliation of Net
Loss to Adjusted EBITDA(Non-GAAP)
(Unaudited) |
|
|
Quarter Ended |
|
Consolidated |
BurgerFi |
|
Anthony's |
(in
thousands) |
July 3,2023 |
|
June 30,2022 |
|
July 3,2023 |
|
June 30,2022 |
|
July 3,2023 |
|
June 30,2022 |
Revenue by Segment |
$ |
43,427 |
|
|
$ |
45,298 |
|
|
$ |
11,567 |
|
|
$ |
13,458 |
|
|
$ |
31,860 |
|
|
$ |
31,840 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
Reconciliation by Segment: |
|
|
|
|
|
|
|
|
|
|
|
Net loss |
$ |
(6,001 |
) |
|
$ |
(60,377 |
) |
|
$ |
(5,159 |
) |
|
$ |
(21,726 |
) |
|
$ |
(842 |
) |
|
$ |
(38,651 |
) |
Goodwill impairment |
|
— |
|
|
|
55,168 |
|
|
|
— |
|
|
|
17,505 |
|
|
|
— |
|
|
|
37,663 |
|
Lease termination recovery |
|
(42 |
) |
|
|
— |
|
|
|
(42 |
) |
|
|
|
|
— |
|
|
|
— |
|
Share-based compensation expense |
|
556 |
|
|
|
909 |
|
|
|
529 |
|
|
|
909 |
|
|
|
27 |
|
|
|
— |
|
Depreciation and amortization expense |
|
3,295 |
|
|
|
4,730 |
|
|
|
2,147 |
|
|
|
2,616 |
|
|
|
1,148 |
|
|
|
2,114 |
|
Interest expense |
|
2,211 |
|
|
|
2,246 |
|
|
|
1,004 |
|
|
|
992 |
|
|
|
1,207 |
|
|
|
1,254 |
|
Restructuring costs |
|
1,127 |
|
|
|
— |
|
|
|
413 |
|
|
|
— |
|
|
|
714 |
|
|
|
— |
|
Merger, acquisition and integration costs |
|
299 |
|
|
|
1,893 |
|
|
|
234 |
|
|
|
1,846 |
|
|
|
65 |
|
|
|
47 |
|
Legal settlements |
|
228 |
|
|
|
187 |
|
|
|
225 |
|
|
|
187 |
|
|
|
3 |
|
|
|
— |
|
Store closure costs |
|
50 |
|
|
|
52 |
|
|
|
9 |
|
|
|
52 |
|
|
|
41 |
|
|
|
— |
|
Loss (gain) on change in value of warrant liability |
|
318 |
|
|
|
(1,858 |
) |
|
|
318 |
|
|
|
(1,858 |
) |
|
|
— |
|
|
|
— |
|
(Gain) loss on sale of assets |
|
(10 |
) |
|
|
— |
|
|
|
(6 |
) |
|
|
— |
|
|
|
(4 |
) |
|
|
— |
|
Income tax expense (benefit) |
|
2 |
|
|
|
(335 |
) |
|
|
— |
|
|
|
(341 |
) |
|
|
2 |
|
|
|
6 |
|
Adjusted EBITDA |
$ |
2,033 |
|
|
$ |
2,615 |
|
|
$ |
(328 |
) |
|
$ |
182 |
|
|
$ |
2,361 |
|
|
$ |
2,433 |
|
|
BurgerFi International Inc., and
SubsidiariesConsolidated Reconciliation of Net
Loss to Adjusted EBITDA(Non-GAAP)
(Unaudited) |
|
|
Six Months Ended |
|
Consolidated |
BurgerFi |
|
Anthony's |
(in
thousands) |
July 3,2023 |
|
June 30,2022 |
|
July 3,2023 |
|
June 30,2022 |
|
July 3,2023 |
|
June 30,2022 |
Revenue by Segment |
$ |
89,154 |
|
|
$ |
90,231 |
|
|
$ |
24,148 |
|
|
$ |
25,854 |
|
|
|
65,005 |
|
|
$ |
64,377 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
Reconciliation by Segment: |
|
|
|
|
|
|
|
|
|
|
|
Net loss |
$ |
(15,153 |
) |
|
$ |
(73,938 |
) |
|
|
(14,757 |
) |
|
$ |
(34,687 |
) |
|
$ |
(396 |
) |
|
$ |
(39,251 |
) |
Goodwill impairment |
|
— |
|
|
|
55,168 |
|
|
|
— |
|
|
|
17,505 |
|
|
|
— |
|
|
|
37,663 |
|
Lease termination recovery |
|
(42 |
) |
|
|
— |
|
|
|
(42 |
) |
|
|
|
|
— |
|
|
|
— |
|
Employee retention credits |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
— |
|
Share-based compensation expense |
|
5,230 |
|
|
|
8,285 |
|
|
|
5,203 |
|
|
|
8,285 |
|
|
|
27 |
|
|
|
— |
|
Depreciation and amortization expense |
|
6,522 |
|
|
|
9,174 |
|
|
|
4,237 |
|
|
|
5,123 |
|
|
|
2,285 |
|
|
|
4,051 |
|
Interest expense |
|
4,289 |
|
|
|
4,318 |
|
|
|
1,922 |
|
|
|
1,957 |
|
|
|
2,367 |
|
|
|
2,361 |
|
Restructuring costs |
|
2,044 |
|
|
|
— |
|
|
|
1,078 |
|
|
|
— |
|
|
|
966 |
|
|
|
— |
|
Merger, acquisition and integration costs |
|
627 |
|
|
|
2,304 |
|
|
|
562 |
|
|
|
2,191 |
|
|
|
65 |
|
|
|
113 |
|
Legal settlements |
|
510 |
|
|
|
312 |
|
|
|
507 |
|
|
|
312 |
|
|
|
3 |
|
|
|
— |
|
Store closure costs |
|
171 |
|
|
|
566 |
|
|
|
74 |
|
|
|
586 |
|
|
|
97 |
|
|
|
(20 |
) |
Loss (gain) on change in value of warrant liability |
|
391 |
|
|
|
(1,324 |
) |
|
|
391 |
|
|
|
(1,324 |
) |
|
|
— |
|
|
|
— |
|
Pre-opening costs |
|
— |
|
|
|
474 |
|
|
|
— |
|
|
|
474 |
|
|
|
— |
|
|
|
— |
|
Income tax expense (benefit) |
|
2 |
|
|
|
(447 |
) |
|
|
— |
|
|
|
(451 |
) |
|
|
2 |
|
|
|
4 |
|
(Gain) loss on sale of assets |
|
(10 |
) |
|
|
— |
|
|
|
(6 |
) |
|
|
— |
|
|
|
(4 |
) |
|
|
— |
|
Adjusted EBITDA |
$ |
4,581 |
|
|
$ |
4,892 |
|
|
$ |
(831 |
) |
|
$ |
(29 |
) |
|
$ |
5,412 |
|
|
$ |
4,921 |
|
|
BurgerFi International Inc., and
SubsidiariesConsolidated Restaurant Level
Operating Expenses(Unaudited) |
|
|
Quarter Ended |
|
Six Months Ended |
|
July 3, 2023 |
|
June 30, 2022 |
|
July 3, 2023 |
|
June 30, 2022 |
(in
thousands) |
In dollars |
|
% ofrestaurantsales |
|
In dollars |
|
% ofrestaurantsales |
|
In dollars |
|
% ofrestaurantsales |
|
In dollars |
|
% ofrestaurantsales |
Restaurant Sales |
$ |
40,808 |
|
100.0 |
% |
|
$ |
42,236 |
|
100.0 |
% |
|
$ |
84,124 |
|
100.0 |
% |
|
$ |
84,592 |
|
100.0 |
% |
Restaurant level operating
expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Food, beverage and paper costs |
|
10,772 |
|
26.4 |
% |
|
|
12,545 |
|
29.7 |
% |
|
|
22,382 |
|
26.6 |
% |
|
|
25,352 |
|
30.0 |
% |
Labor and related expenses |
|
12,699 |
|
31.1 |
% |
|
|
12,328 |
|
29.2 |
% |
|
|
25,916 |
|
30.8 |
% |
|
|
24,910 |
|
29.4 |
% |
Other operating expenses |
|
7,760 |
|
19.0 |
% |
|
|
7,421 |
|
17.6 |
% |
|
|
15,216 |
|
18.1 |
% |
|
|
14,613 |
|
17.3 |
% |
Occupancy and related expenses |
|
3,930 |
|
9.6 |
% |
|
|
3,890 |
|
9.2 |
% |
|
|
7,763 |
|
9.2 |
% |
|
|
7,725 |
|
9.1 |
% |
Total |
$ |
35,161 |
|
86.2 |
% |
|
$ |
36,184 |
|
85.7 |
% |
|
$ |
71,277 |
|
84.7 |
% |
|
$ |
72,600 |
|
85.8 |
% |
|
Anthony’s Brand OnlyRestaurant Level
Operating Expenses(Unaudited) |
|
|
Quarter Ended |
|
Six Months Ended |
|
July 3, 2023 |
|
June 30, 2022 |
|
July 3, 2023 |
|
June 30, 2022 |
(in
thousands) |
In dollars |
|
% ofrestaurantsales |
|
In dollars |
|
% ofrestaurantsales |
|
In dollars |
|
% ofrestaurantsales |
|
In dollars |
|
% ofrestaurantsales |
Restaurant Sales |
$ |
31,860 |
|
100.0 |
% |
|
$ |
31,840 |
|
100.0 |
% |
|
$ |
65,005 |
|
100.0 |
% |
|
$ |
64,375 |
|
100.0 |
% |
Restaurant level operating
expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Food, beverage and paper costs |
|
8,076 |
|
25.3 |
% |
|
|
9,133 |
|
28.7 |
% |
|
|
16,738 |
|
25.7 |
% |
|
|
18,910 |
|
29.4 |
% |
Labor and related expenses |
|
9,849 |
|
30.9 |
% |
|
|
9,426 |
|
29.6 |
% |
|
|
20,089 |
|
30.9 |
% |
|
|
19,259 |
|
29.9 |
% |
Other operating expenses |
|
5,759 |
|
18.1 |
% |
|
|
5,313 |
|
16.7 |
% |
|
|
11,128 |
|
17.1 |
% |
|
|
10,562 |
|
16.4 |
% |
Occupancy and related expenses |
|
3,003 |
|
9.4 |
% |
|
|
2,988 |
|
9.4 |
% |
|
|
5,957 |
|
9.2 |
% |
|
|
5,860 |
|
9.1 |
% |
Total |
$ |
26,687 |
|
83.8 |
% |
|
$ |
26,860 |
|
84.4 |
% |
|
$ |
53,912 |
|
82.9 |
% |
|
$ |
54,591 |
|
84.8 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BurgerFi Brand OnlyRestaurant Level
Operating Expenses(Unaudited) |
|
|
Quarter Ended |
|
Six Months Ended |
|
July 3, 2023 |
|
June 30, 2022 |
|
July 3, 2023 |
|
June 30, 2022 |
(in
thousands) |
In dollars |
|
% ofrestaurantsales |
|
In dollars |
|
% ofrestaurantsales |
|
In dollars |
|
% ofrestaurantsales |
|
In dollars |
|
% ofrestaurantsales |
Restaurant Sales |
$ |
8,948 |
|
100.0 |
% |
|
$ |
10,396 |
|
100.0 |
% |
|
$ |
19,119 |
|
100.0 |
% |
|
$ |
20,217 |
|
100.0 |
% |
Restaurant level operating
expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Food, beverage and paper costs |
|
2,696 |
|
30.1 |
% |
|
|
3,412 |
|
32.8 |
% |
|
|
5,644 |
|
29.5 |
% |
|
|
6,442 |
|
31.9 |
% |
Labor and related expenses |
|
2,851 |
|
31.9 |
% |
|
|
2,902 |
|
27.9 |
% |
|
|
5,827 |
|
30.5 |
% |
|
|
5,651 |
|
28.0 |
% |
Other operating expenses |
|
2,001 |
|
22.4 |
% |
|
|
2,108 |
|
20.3 |
% |
|
|
4,088 |
|
21.4 |
% |
|
|
4,051 |
|
20.0 |
% |
Occupancy and related expenses |
|
927 |
|
10.4 |
% |
|
|
902 |
|
8.7 |
% |
|
|
1,807 |
|
9.5 |
% |
|
|
1,865 |
|
9.2 |
% |
Total |
$ |
8,475 |
|
94.7 |
% |
|
$ |
9,324 |
|
89.7 |
% |
|
$ |
17,366 |
|
90.8 |
% |
|
$ |
18,009 |
|
89.1 |
% |
|
BurgerFi International Inc., and
SubsidiariesSegment Unit Counts |
|
|
Quarter Ended |
|
Six Months Ended |
|
July 3, 2023 |
|
July 3, 2023 |
|
Corporate-owned |
|
Franchised |
|
Total |
|
Corporate-owned |
|
Franchised |
|
Total |
Total BurgerFi and Anthony's brands |
87 |
|
87 |
|
174 |
|
87 |
|
87 |
|
174 |
|
|
|
|
|
|
|
|
|
|
|
|
BurgerFi stores, beginning of
the period |
27 |
|
85 |
|
112 |
|
25 |
|
89 |
|
114 |
BurgerFi stores opened |
— |
|
3 |
|
3 |
|
— |
|
5 |
|
5 |
BurgerFi stores acquired /
(transferred) |
— |
|
— |
|
— |
|
2 |
|
(2) |
|
— |
BurgerFi stores closed |
— |
|
(1) |
|
(1) |
|
— |
|
(5) |
|
(5) |
BurgerFi total stores,
end of the period |
27 |
|
87 |
|
114 |
|
27 |
|
87 |
|
114 |
|
|
|
|
|
|
|
|
|
|
|
|
Anthony's stores, beginning of
period |
60 |
|
— |
|
60 |
|
60 |
|
— |
|
60 |
Anthony's stores closed |
— |
|
— |
|
— |
|
— |
|
— |
|
— |
Anthony's total
stores, end of the period |
60 |
|
— |
|
60 |
|
60 |
|
— |
|
60 |
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