Review of Fourth Quarter 2013 Operating Results

Consolidated revenues increased $16.6 million, or 20.5%, to $97.5 million in the fourth quarter of 2013 from $80.9 million in the fourth quarter of 2012. This increase was due to 113 additional operating weeks resulting from eight restaurant openings subsequent to the third quarter of the previous year along with one additional operating week in the recent fiscal period. The additional 17 th week in the fourth quarter 2013 contributed $5.8 million to consolidated revenues. The fourth quarter benefited from the favorable comparison against lost revenues related to Hurricane Sandy during the fourth quarter of 2012; however, this benefit was significantly offset by lost operating days in December 2013 resulting from ice and snow storms.

Total operating weeks for all concepts during the fourth quarter of 2013 increased 21.4% to 640 from 527 in the fourth quarter of 2012. Total comparable restaurant sales increased 2.8% (on a 16-week comparable basis) following a total comparable restaurant sales increase of 2.7% in the fourth quarter of the previous year.

Cost of sales increased $4.9 million, or 19.9%, to $29.5 million in the fourth quarter of 2013 from $24.6 million in the fourth quarter of 2012. As a percentage of consolidated revenues, cost of sales decreased to 30.3% from 30.4%.

Restaurant-level EBITDA** increased $2.7 million, or 13.2%, to $23.2 million in the fourth quarter of 2013 from $20.5 million in the third quarter of 2012. As a percentage of consolidated revenues, restaurant-level EBITDA decreased to 23.8% from 25.4%.

General and administrative costs increased $0.5 million, or 11.5%, to $5.3 million, or 5.4% of consolidated revenues, from $4.8 million, or 5.9% of consolidated revenues. In addition to the extra week during the quarter, this net increase was due to growth in corporate level personnel and management training expenses to support recent and anticipated growth along with increased non-cash stock compensation expense.  These increases during the quarter were significantly offset by reduced incentive bonus compensation.

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