JACKSONVILLE, FL / ACCESSWIRE / May 16, 2019 / ARC Group, Inc. (OTCQB: ARCK), a restaurant holding company with a focus on diversified, full-service restaurants and brands, today provided a business update for the first quarter ended March 31, 2019.
First Quarter 2019 Financial Highlights:
Revenue increased 286% to $4,588,821 during Q1 2019 from $1,189,164 during Q1 2018.
Loss from operations was $256,993 for Q1 2019 compared to income from operations of $48,308 for Q1 2018.
Adjusted income from operations was $68,460 during Q1 2019 compared to $76,364 during Q1 2018.
Net loss was $414,243 for Q1 2019 compared to net income of $47,614 during Q1 2018.
EBITDA was $80,107 for Q1 2019 compared to $58,865 for Q1 2018.
A reconciliation of adjusted income from operations, adjusted net income, and adjusted earnings per share on a GAAP and non-GAAP basis is included in the table below entitled 'Reconciliation of GAAP to non-GAAP Financial Measures'.
Seenu G. Kasturi, CEO of ARC Group, stated, 'We are extremely pleased to report that our revenue increased 286% to approximately $4.6 million for the first quarter of 2019. The increase in revenue was due to organic growth within Dick's Wings and our acquisition of Fat Patty's in August of 2018. We expect our revenue will continue to increase during the next 12 months as we generate sales through our company-owned restaurants, continue to improve the operations of our existing Dick's Wings and Fat Patty's restaurants, and open new Dick's Wings and Fat Patty's restaurants. We also opened our first Tilted Kilt restaurant in Louisiana in November 2018, which we currently operate as a franchise until we compete the acquisition of the entire franchise. We expect our revenue to increase substantially as a result of our pending acquisition of Tilted Kilt and as we acquire additional interests in other restaurant brands.'
'We are pleased with our progress throughout the first quarter of 2019. Although our operating expenses increased due to the company-owned restaurants that we opened and acquired and the buildout of our infrastructure, we now have a highly scalable operation with tremendous profit potential as we continue to grow our revenue. We look forward to providing meaningful updates regarding Tilted Kilt as well as other developments as we continue to work towards acquiring leading brands at attractive multiples that will enhance our company and provide us with a diversified operating portfolio.'
Complete financial results are available in the Company's Form 10-Q, which has been filed with the Securities & Exchange Commission and is available at www.sec.gov.
Non-GAAP Financial Measures
The Company prepares it's consolidated financial statements in accordance with United States generally accepted accounting principles ('GAAP'). In addition to disclosing financial information prepared in accordance with GAAP, this release also includes non-GAAP operating income, non-GAAP net income and non-GAAP net income per share data for the periods presented. Management uses non-GAAP financial measures internally for financial and operational decision-making and as a means to evaluate period-to-period comparisons. The Company's management believes that these non-GAAP financial measures provide useful supplemental information to management and investors regarding the performance of the Company's core business operations, enhance the overall understanding of past financial performance and future prospects, and allow for greater transparency with respect to key metrics used by management in its financial and operational decision making.
These non-GAAP financial measures are not recognized measures for financial statement presentation under U.S. GAAP and do not have standardized meanings. Accordingly, they may be different from similar non-GAAP financial measures presented by other companies. These non-GAAP financial measures should only be used to evaluate the Company's results of operations in conjunction with the corresponding GAAP financial measures. Investors should consider these non-GAAP financial measures as a supplement to, and not as a substitute for, corresponding financial measures calculated in accordance with GAAP.
For the purposes of this press release, the following non-GAAP financial measures have the following meanings:
'Adjusted income from operations' means income from operations plus depreciation expense, stock compensation expense, and amortization expense for operating and financing lease right-of-use assets, intangible assets and debt discount.
'EBITDA' means net (loss) / income plus depreciation expense and amortization expense for operating and financing lease right-of-use assets, intangible assets and debt discount interest expense, interest income, depreciation expense, stock-based compensation expense, and other income.
'Adjusted earnings per share' means adjusted net income divided by the weighted average number of shares outstanding - basic and fully diluted.
For a reconciliation of these non-GAAP financial measures to their most directly comparable GAAP financial measures, please see the table below entitled 'Reconciliation of GAAP to Non-GAAP Financial Measures'.
About ARC Group, Inc.
ARC Group, Inc., headquartered in Jacksonville, Florida, is a holding company with a focus on the casual dining restaurant industry. ARC is the owner, operator and franchisor of Dick's Wings & Grill, a family-oriented restaurant chain with locations in Florida and Georgia. Now in its 24th year of operation, Dick's Wings serves over 25,000 wings daily, and prides itself on its award-winning chicken wings, hog wings and duck wings spun in its signature sauces and seasonings. ARC operates four company-owned restaurants, three company-owned concession stands, and has 19 franchise locations. ARC also owns the Fat Patty's concept, with four locations in West Virginia and Kentucky. Fat Patty's offers a number of specialty burgers and sandwiches, wings, appetizers, salads, wraps, and steak and chicken dinners in a family friendly, casual dining environment.
Safe Harbor Provision
This press release contains 'forward-looking statements' within the meaning of the Private Securities Litigation Reform Act of 1995, as amended, that are intended to be covered by the safe harbor created thereby. All statements other than statements of historical fact contained herein, including, without limitation, statements regarding the Company's future financial position, business strategy, plans and objectives, are forward-looking statements. Forward-looking statements generally can be identified by the use of forward-looking terminology such as 'may,' 'will,' 'expects,' 'intends,' 'plans,' 'projects,' 'estimates,' 'anticipates,' or 'believes' or the negative thereof or any variation thereon or similar terminology or expressions. Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from results proposed in such statements. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, it can provide no assurance that such expectations will prove to have been correct. Important factors that could cause actual results to differ materially from the Company's expectations include, but are not limited to, those factors set forth in the Company's Annual Report on Form 10-K for the year ended December 31, 2018 and its other filings and submissions with the SEC. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date made. Except as required by law, the Company assumes no obligation to update or revise any forward-looking statements.
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