- Total revenue increased 22.6% to $71.9 million compared to $58.6 million in the third quarter of 2015.
- Company-operated comparable restaurant sales increased 0.2% as compared to the third quarter of 2015.
- Net income was $0.8 million, or $0.04 per diluted weighted average share compared to $0.9 million, or $0.07 per diluted weighted average share in the third quarter of 2015.
- Adjusted fully distributed pro forma net income (1) was $1.4 million, or $0.05 per fully distributed weighted average share compared with $1.7 million, or $0.06 per fully distributed weighted average share for the third quarter of 2015.
- Adjusted EBITDA (1) was $7.4 million compared to $6.8 million for the third quarter of 2015.
- The Company opened six new company-operated restaurants and two franchised restaurants during the third quarter and, as of September 27, 2016, had 152 company-operated locations and eight franchised/licensed locations (excluding the five licensed locations in Santa Barbara County, California) for a system-wide total of 160 locations.
Company-operated comparable restaurant sales increased 0.2% for the quarter ended September 27, 2016. The increase in company-operated comparable restaurant sales was driven primarily by a 2.6% increase in average transaction amount partially offset by a 2.4% decrease in transactions.Net income for the third quarter of 2016 was $0.8 million, or $0.04 per diluted weighted average share compared to $0.9 million, or $0.07 per diluted weighted average share in the third quarter of 2015. Adjusted fully distributed pro forma net income in the third quarter of 2016 was $1.4 million, or $0.05 per fully distributed weighted average share, compared to $1.7 million, or $0.06 per fully distributed weighted average share, in the third quarter of 2015. A reconciliation between GAAP net income and adjusted fully distributed pro forma net income is included in the accompanying financial data. 2016 Outlook The Company currently anticipates the following for its fiscal year 2016:
- Total revenue between $283 million to $284 million;
- Company-operated comparable restaurant sales growth of approximately 2.0%;
- The opening of 26 to 28 company-operated restaurants and five to seven franchised/licensed restaurants;
- Restaurant contribution margin of 20.6% to 20.9%;
- General and administrative expenses of $28.8 million to $29.1 million;
- Depreciation and amortization expense of approximately $15.0 million;
- Capital expenditures of $33.0 million to $35.0 million; and
- An effective pro forma tax rate of approximately 42.0%, which assumes the conversion of all common units of The Habit Restaurants, LLC for shares of our Class A common stock (and cancellation of corresponding shares of our Class B common stock), which would eliminate the non-controlling interests.
The conference call can be accessed live over the phone by dialing (855) 327-6837 or for international callers by dialing (778) 327-3988. A replay will be available after the call and can be accessed by dialing (877) 870-5176 or for international callers by dialing (858) 384-5517; the passcode is 10001943. The replay will be available until Wednesday, November 9, 2016. The conference call will also be webcast live from the Company's corporate website at ir.habitburger.com under the "Events" page. An archive of the webcast will be available at the same location on the corporate website shortly after the call has concluded.The following definitions apply to these terms as used in this release: Comparable restaurant sales reflect the change in year-over-year sales in our comparable restaurant base. A restaurant enters our comparable restaurant base in the accounting period following its 18th full period of operations. Average Unit Volumes (AUVs) are calculated by dividing revenue for the trailing 52-week period for all company-operated restaurants that have operated for 12 full periods by the total number of restaurants open for such period. Adjusted fully distributed pro forma net income includes net income attributable to The Habit (i) excluding income tax expense, (ii) excluding the effect of non-recurring items, (iii) assuming the exchange of all common units of The Habit Restaurants, LLC into shares of our Class A common stock (and cancellation of corresponding shares of our Class B common stock), which results in the elimination of non-controlling interests in The Habit Restaurants, LLC, and (iv) reflecting an adjustment for income tax expense on fully distributed pro forma net income before income taxes at our estimated long term effective income tax rate. Adjusted fully distributed pro forma net income is a non-GAAP financial measure because it represents net income attributable to The Habit, before non-recurring items and the effects of non-controlling interests in The Habit Restaurants, LLC. We use adjusted fully distributed pro forma net income to facilitate a comparison of our operating performance on a consistent basis from period to period that, when viewed in combination with our results prepared in accordance with GAAP, provides a more complete understanding of factors and trends affecting our business than GAAP measures alone and eliminates the variability of non-controlling interests as a result of member owner exchanges of common units of The Habit Restaurants, LLC into shares of our Class A common stock (and cancellation of corresponding shares of our Class B common stock). Adjusted fully distributed pro forma net income per fully distributed weighted average share is calculated using adjusted fully distributed pro forma net income as defined above and assumes the exchange of all common units of The Habit Restaurants, LLC into shares of our Class A common stock (and cancellation of corresponding shares of our Class B common stock). EBITDA, a non-GAAP measure, represents net income before interest expense, net, provision for income taxes, and depreciation and amortization. Adjusted EBITDA, a non-GAAP measure, represents EBITDA plus pre-opening costs, stock-based compensation, loss on disposal of assets, and offering and exchange related expenses. About The Habit Restaurants, Inc. The Habit Burger Grill is a fast casual restaurant concept that specializes in preparing fresh, made-to-order char-grilled burgers and sandwiches featuring USDA choice tri-tip steak, grilled chicken and sushi-grade albacore tuna cooked over an open flame. The first Habit opened in Santa Barbara, California in 1969. The Habit has since grown to over 160 restaurants in 15 markets throughout California, Arizona, Utah, New Jersey, Florida, Idaho, Virginia, Nevada, Washington and Maryland.
Forward-Looking StatementsThis press release contains forward-looking statements that are subject to risks and uncertainties. All statements other than statements of historical fact included in this press release are forward-looking statements. Forward-looking statements discuss our current expectations and projections relating to our financial condition, results of operations, plans, objectives, future performance and business. You can identify forward-looking statements because they do not relate strictly to historical or current facts. These statements may include words such as "aim," "anticipate," "believe," "estimate," "expect," "forecast," "outlook," "potential," "project," "projection," "plan," "intend," "seek," "may," "could," "would," "will," "should," "can," "can have," "likely," the negatives thereof and other words and terms of similar meaning in connection with any discussion of the timing or nature of future operating or financial performance or other events. They appear in a number of places throughout this press release and include statements regarding our intentions, beliefs or current expectations concerning, among other things, our results of operations, financial condition, liquidity, prospects, growth, strategies and the industry in which we operate. All forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those that we expected. While we believe that our assumptions are reasonable, we caution that it is very difficult to predict the impact of known factors, and it is impossible for us to anticipate all factors that could affect our actual results. All forward-looking statements are expressly qualified in their entirety by these cautionary statements. You should evaluate all forward-looking statements made in this press release in the context of the risks and uncertainties disclosed in our annual report on Form 10-K for the year ended December 29, 2015, including the sections thereof captioned "Cautionary Note Regarding Forward-Looking Statements" and "Risk Factors." These filings and others are available online at www.sec.gov, ir.habitburger.com or upon request from The Habit. We caution you that the important factors referenced above may not contain all of the factors that are important to you. In addition, we cannot assure you that we will realize the results or developments we expect or anticipate or, even if substantially realized, that they will result in the consequences we anticipate or affect us or our operations in the ways that we expect. The forward-looking statements included in this press release are made only as of the date hereof. We undertake no obligation to publicly update or revise any forward-looking statement as a result of new information, future events or otherwise, except as required by law. If we do update one or more forward-looking statements, no inference should be made that we will make additional updates with respect to those or other forward-looking statements. We qualify all of our forward-looking statements by these cautionary statements.
Non-GAAP Financial MeasuresTo supplement our consolidated financial statements, which are prepared and presented in accordance with GAAP, we use non-GAAP financial measures, including those discussed above. These measures are not intended to be considered in isolation or as substitutes for, or superior to, financial measures prepared and presented in accordance with GAAP. We use non-GAAP financial measures for financial and operational decision-making and as a means to evaluate period-to-period comparisons. We believe that they provide useful information about operating results, enhance understanding of past performance and future prospects, and allow for greater transparency with respect to key metrics used by management in its financial and operational decision making. However, when analyzing the Company's operating performance, investors should not consider adjusted earnings per fully distributed weighted average share or adjusted fully distributed pro forma net income in isolation or as substitutes for net income (loss), cash flows from operating activities or other operation statement or cash flow statement data prepared in accordance with U.S. GAAP. The non-GAAP measures used in this press release may be different from the measures used by other companies. Consolidated Statement of Operations Data (unaudited): Our operating results are presented as a percentage of total revenue, with the exception of restaurant operating costs, depreciation and amortization expense, pre-opening costs and loss on disposal of assets, which are presented as a percentage of restaurant revenue.
|13 Weeks Ended||39 Weeks Ended|
|(amounts in thousands except share and per share data)||September 27, 2016||September 29, 2015||September 27, 2016||September 29, 2015|
|Restaurant operating costs (excluding depreciation and amortization)|
|Food and paper costs||21,788||30.4||%||18,725||32.0||%||63,040||30.1||%||54,754||32.2||%|
|Labor and related expenses||23,727||33.1||%||18,292||31.3||%||68,040||32.5||%||51,666||30.4||%|
|Occupancy and other operating expenses||11,994||16.7||%||9,117||15.6||%||33,822||16.2||%||25,722||15.1||%|
|General and administrative expenses||7,429||10.3||%||6,104||10.4||%||21,555||10.3||%||17,026||10.0||%|
|Offering and exchange related expenses||61||0.1||%||83||0.1||%||421||0.2||%||1,217||0.7||%|
|Depreciation and amortization expense||3,788||5.3||%||2,836||4.8||%||10,779||5.1||%||8,163||4.8||%|
|Loss on disposal of assets||35||0.0||%||25||0.0||%||110||0.1||%||58||0.0||%|
|Total operating expenses||69,391||96.5||%||55,817||95.2||%||199,128||94.8||%||159,948||94.1||%|
|Income from operations||2,494||3.5||%||2,831||4.8||%||10,830||5.2||%||10,013||5.9||%|
|Interest expense, net||179||0.2||%||110||0.2||%||456||0.2||%||342||0.2||%|
|Income before income taxes||2,315||3.2||%||2,721||4.6||%||10,374||4.9||%||9,671||5.7||%|
|Provision for income taxes||869||1.2||%||522||0.9||%||3,038||1.4||%||2,089||1.2||%|
|Less: net income attributable to non-controlling interests||(677||)||-0.9||%||(1,281||)||-2.2||%||(3,996||)||-1.9||%||(5,304||)||-3.1||%|
|Net income attributable to The Habit Restaurants, Inc.||$||769||1.1||%||$||918||1.6||%||$||3,340||1.6||%||$||2,278||1.3||%|
|Net income attributable to The Habit Restaurants, Inc. per share Class A common stock:|
|Weighted average shares of Class A common stock outstanding:|
|Balance Sheet Data||September 27, 2016||December 29, 2015|
|(dollar amounts in thousands)|
|Balance Sheet Data-Consolidated (at period end):|
|Cash and cash equivalents||$||50,374||$||46,991|
|Property and equipment, net (a)||97,973||81,524|
|Total debt (b)||6,049||2,436|
|Total stockholders' equity||141,933||131,932|
|13 Weeks Ended|
|Selected Operating Data||September 27, 2016||September 29, 2015|
|Other Operating Data:|
|Total restaurants at end of period||160||128|
|Company-operated restaurants at end of period||152||124|
|Company-operated comparable restaurant sales growth (a)||0.2||%||2.9||%|
|Company-operated average unit volumes||$||1,911||$||1,924|
|39 Weeks Ended|
|Selected Operating Data||September 27, 2016||September 29, 2015|
|Other Operating Data:|
|Company-operated comparable restaurant sales growth (a)||2.0||%||7.6||%|
|13 Weeks Ended||39 Weeks Ended|
|Adjusted EBITDA Reconciliation||September 27, 2016||September 29, 2015||September 27, 2016||September 29, 2015|
|(amounts in thousands)|
|Provision for income taxes||869||522||3,038||2,089|
|Interest expense, net||179||110||456||342|
|Depreciation and amortization||3,788||2,836||10,779||8,163|
|Stock-based compensation expense (a)||499||342||1,366||852|
|Loss on disposal of assets (b)||35||25||110||58|
|Pre-opening costs (c)||569||635||1,361||1,342|
|Offering and exchange related expenses (d)||61||83||421||1,217|
|13 Weeks Ended||39 Weeks Ended|
|(dollar amounts in thousands)||September 27, 2016||September 29, 2015||September 27, 2016||September 29, 2015|
|Offering and exchange related expenses (a)||61||83||421||1,217|
|Income tax expense as reported||869||522||3,038||2,089|
|Fully distributed pro forma net income before income taxes||2,376||2,804||10,795||10,888|
|Income tax expense on fully distributed pro forma income before income taxes (b)||1,012||1,153||4,534||4,663|
|Adjusted fully distributed pro forma net income||$||1,364||$||1,651||$||6,261||$||6,225|
|Adjusted fully distributed pro forma net income per share of Class A common stock:|
|Weighted average shares of Class A common stock outstanding used in computing adjusted fully distributed pro forma net income (c):|
ContactsInvestors: (949) 943-8692 HabitIR@habitburger.comMedia: (949) 943-8691 Media@habitburger.com