<< Previous :: Next >> By Date :: Top Recent :: Top 30 days :: Top 365 days :: Back

Granite City Food & Brewery® Reports 33.3% Increase in Revenue in Fourth Quarter 2012

2013-03-19

Send

PDF

Bookmark

Text Size:

Granite City Food & Brewery Total restaurant sales increased 33.3% to $30.9 million for the fourth quarter of 2012 from $23.2 million in the fourth quarter of 2011

Granite City Food & Brewery Ltd. (NASDAQ: GCFB), a casual dining restaurant group, today reported results for the fourth quarter and fiscal year ended December 25, 2012.

“2012 was an incredible year for the Company and we accomplished a lot in a very short time period”

Highlights were as follows:

Total restaurant sales increased 33.3% to $30.9 million for the fourth quarter of 2012 from $23.2 million in the fourth quarter of 2011
Total restaurant sales increased 29.7% to $120.9 million for fiscal year 2012 from $93.2 million in fiscal year 2011
Same store sales (SSS) increased 4.5% and 2.6% in the fourth quarter and fiscal year 2012 over the comparable periods of 2011, respectively
Restaurant-level Income Before Occupancy (“IBO”) increased $2.6 million and $8.7 million in the fourth quarter and fiscal year 2012 over the comparable periods of 2011, respectively
Company recorded approximately $1.6 million and $7.0 million in Adjusted EBITDA in fourth quarter and fiscal year 2012, respectively, compared to $0.03 million and $3.0 million in the comparable periods of 2011

“2012 was an incredible year for the Company and we accomplished a lot in a very short time period,” commented Rob Doran, CEO. “This past year we focused on setting the stage for growth and then executing on the steps we put in place to grow both organically and externally. Organically, we were able to increase our store level revenue and our store level operating margin pushing more store level income to the bottom line. Additionally, we began our rebranding process through signage, menus and most importantly, our new prototype Granite City restaurant in Troy, MI – which has been a huge success and surpassed all our internal pre-opening goals. Externally, we finalized the purchase of four additional Cadillac Ranch restaurants, stabilized the operations and absorbed the growth within our home office team. The completion of a $6.5 million equity placement with CDP mid-year helped fund 2012 growth and set the stage for three additional Granite City restaurants in 2013 – including our recent opening in Franklin, TN. We are very happy with our results of this past year and look forward to continued success in 2013.”

Fourth Quarter 2012 Financial Results

Total revenue for fourth quarter 2012 increased by 33.3% to $30.9 million compared to $23.2 million for the fourth quarter of 2011. The five Cadillac Ranch restaurants acquired in November and December of 2011 and the one Cadillac Ranch restaurant acquired in May 2012 accounted for approximately $5.1 million of the $7.7 million increase in sales. Total cost of sales before occupancy was $23.3 million in the fourth quarter of 2012 or 75.5% of revenue compared to prior year fourth quarter cost of sales before occupancy of $18.2 million or 78.7% of revenue.

General and administrative expenses were $2.5 million or 8.1% of revenue for the fourth quarter of 2012 compared to $2.5 million or 10.6% of revenue for the fourth quarter of 2011. This decrease in general and administrative expense as a percent of revenue was primarily attributable to the larger sales base associated with our Cadillac Ranch acquisitions. We believe that the benefit of restaurant, menu and food upgrades, and future restaurant unit growth will help to further reduce general and administrative expenses as a percentage of revenue.

The net loss for the fourth quarter of 2012 was $1.0 million compared to a net loss of $3.1 million in the fourth quarter of 2011. In the fourth quarter of 2011, there were additional one-time expenses related to the Cadillac Ranch asset acquisitions and personnel costs which caused a higher net loss. Net loss per share available to common shareholders was $(0.15) and $(0.70) for the fourth quarters of 2012 and 2011, respectively. Net loss per share available to common shareholders in the fourth quarters of 2012 and 2011 included $(0.03) and $(0.04) attributable to a declared dividend on preferred stock, respectively. Weighted average shares outstanding in the fourth quarters of 2012 and 2011 were 8.1 million and 4.7 million, respectively.

Fiscal Year 2012 Financial Results

Total revenue for the fiscal year of 2012 increased by 29.7% to $121.0 million compared to $93.2 million for the fiscal year of 2011. The acquired Cadillac Ranch restaurants accounted for approximately $21.0 million of the $27.8 million increase in sales. Total cost of sales before occupancy was $90.7 million in the fiscal year of 2012 or 75.0% of revenue compared to cost of sales before occupancy in the fiscal year of 2011 of $71.7 million or 76.9% of revenue.

General and administrative expenses were $9.7 million or 8.0% of revenue for the fiscal year of 2012 compared to $8.2 million or 8.8% of revenue for the fiscal year of 2011.

The net loss for the fiscal year of 2012 was $4.1 million compared to a net loss of $4.6 million in the fiscal year of 2011. Included in 2012 was approximately $1.8 million in pre-opening expense and costs related to the acquisition of Cadillac Ranch. Net loss per share available to common shareholders was $(0.77) and $(2.05) for the fiscal years 2012 and 2011, respectively. Net loss per share available to common shareholders in the fiscal years of 2012 and 2011 included $(0.13) and $(0.09) attributable to declared dividends on preferred stock, respectively. Additionally, net loss per share in fiscal year 2011 included $(1.14) attributable to the non-cash beneficial conversion feature of our Series A Preferred Stock. There was a weighted average of 6.4 million and 5.6 million shares of common stock outstanding in the fiscal year of 2012 and 2011, respectively.

Outlook

Guidance for fiscal year 2013 is as follows:

Net sales are anticipated to be between $130 million and $140 million.
Adjusted EBITDA is expected to be between $8.5 million and $9.5 million. As the reconciliation table below indicates, we derive EBITDA by adding back the following items to operating loss: net interest expense, non cash compensation, disposal and exit activities and any related gain or (loss), depreciation and amortization, pre-opening costs and any provision for income taxes. Since the company has many capital leases, we further reduce EBITDA for the difference between the fixed rent recorded and the actual amount paid for rent expense to generate Adjusted EBITDA.

About Granite City

Granite City Food & Brewery Ltd. develops and operates two casual dining concepts: Granite City Food & Brewery and Cadillac Ranch All American Bar & Grill. Granite City Food & Brewery is a polished casual American restaurant that features a great dining experience with affordable, high-quality menu items prepared from made-from-scratch recipes, served in generous portions. There is a brewery onsite, serving hand-crafted and micro brews. Granite City opened its first restaurant in 1999 and is expanding nationwide; there are currently 28 Granite City restaurants in 13 states. Cadillac Ranch restaurants feature freshly prepared, authentic, All-American cuisine in a fun, dynamic environment. Its patrons enjoy a warm, Rock N’ Roll inspired atmosphere, with plenty of room for friends, music and dancing. The Cadillac Ranch menu is diverse with offerings ranging from homemade meatloaf to pasta dishes, all freshly prepared using quality ingredients. The Company purchased its first Cadillac Ranch in November 2011 and has since purchased five additional Cadillac Ranch restaurants along with its intellectual property. The Company currently operates six Cadillac Ranch restaurants in five states.


Granite City Food & Brewery Ltd.

Condensed Consolidated Statements of Operations

	Thirteen Weeks Ended						Fifty-two Weeks Ended
	December 25,			December 27,			December 25,			December 27,
	2012			2011			2012			2011

Restaurant revenues	$	30,858,733		$	23,150,305		$	120,931,643		$	93,222,655

Cost of sales:
Food, beverage and retail		8,394,785			6,360,043			32,723,253			25,408,053
Labor		10,075,877			8,009,972			39,816,861			31,993,363
Direct restaurant operating		4,822,621			3,849,455			18,162,626			14,259,739
Occupancy		2,647,390			1,882,782			9,999,277			7,133,428
Total cost of sales		25,940,673			20,102,252			100,702,017			78,794,583

Pre-opening		127,787			105,887			1,043,199			112,494
General and administrative		2,507,012			2,450,104			9,714,095			8,186,699
Acquisition costs		28,591			868,293			713,336			868,293
Depreciation and amortization		1,911,986			1,471,692			7,405,705			5,997,940
Exit or disposal activities		15,578			17,274			64,839			(139,625	)
Loss on disposal of assets		114,245			183,866			482,508			149,246
Operating income (loss)		212,861			(2,049,063	)		805,944			(746,975	)

Interest:
Income		1,725			1,756			1,757			5,953
Expense		(1,191,727	)		(1,034,449	)		(4,913,182	)		(3,858,509	)
Net interest expense		(1,190,002	)		(1,032,693	)		(4,911,425	)		(3,852,556	)

Net loss	$	(977,141	)	$	(3,081,756	)	$	(4,105,481	)	$	(4,599,531	)

Loss per common share, basic	$	(0.15	)	$	(0.70	)	$	(0.77	)	$	(2.05	)

Weighted average shares outstanding, basic		8,050,178			4,686,845			6,417,488			5,642,620


Selected Balance Sheet Information

	December 25, 2012		December 27, 2011

Cash	$	2,566,034	$	2,128,299
Current assets, including cash	$	5,905,523	$	4,626,534
Total assets	$	71,766,785	$	60,932,417
Current liabilities	$	14,811,246	$	13,903,942
Total liabilities	$	70,258,483	$	61,769,369
Shareholders' equity (deficit)	$	1,508,302	$	(836,952	)


Non-GAAP Reconciliations Q4 2012 Results

									Total for All
	Comparable		% of		New		% of		Restaurants			% of
	Restaurants		Sales		Restaurants		Sales		As Reported			Sales

Restaurant revenues	$	23,463,396	100	%	$	7,395,337	100	%	$	30,858,733		100	%

Cost of sales:
Food, beverage and retail		6,437,522	27.4	%		1,957,263	26.5	%		8,394,785		27.2	%
Labor		8,000,075	34.1	%		2,075,802	28.1	%		10,075,877		32.7	%
Direct restaurant operating expenses		3,540,427	15.1	%		1,282,194	17.3	%		4,822,621		15.6	%

Restaurant-level IBO*	$	5,485,372	23.4	%	$	2,080,078	28.1	%	$	7,565,450		24.5	%

Occupancy										2,647,390		8.6	%
Pre-opening										127,787
Acquisition costs										28,591
General and administrative										2,507,012		8.1	%

Company-wide EBITDA*										2,254,670		7.3	%

Depreciation and amortization										1,911,986
Exit or disposal activities, other										129,823

Operating loss										212,861

Interest:
Income										1,725
Expense										(1,191,727	)
Net interest expense										(1,190,002	)

Net loss									$	(977,141	)


Non-GAAP Reconciliations Q4 2012 Adjusted EBITDA

Net loss	$	(977,141	)

Net interest expense		1,190,002
Exit or disposal activities		15,578
Loss on disposal of assets		114,245
Depreciation and amortization		1,911,986
Pre-opening		127,787
Acquisition costs		28,591
Termination/contract negotiation costs		138,131
Share-based compensation		86,082
Lease adjustment		(1,058,349	)
Adjusted EBITDA*	$	1,576,912

*See accompanying disclosure regarding use of non-GAAP financial measures.

Certain percentages may not foot due to rounding.


Non-GAAP Reconciliations Q4 2011 Results

								Total for All
	Comparable		% of		New		% of	Restaurants			% of
	Restaurants		Sales		Restaurants		Sales	As Reported			Sales

Restaurant revenues	$	22,454,713	100	%	$	695,592	N/A	$	23,150,305		100	%

Cost of sales:
Food, beverage and retail		6,149,873	27.4	%		210,170	N/A		6,360,043		27.5	%
Labor		7,808,772	34.8	%		201,200	N/A		8,009,972		34.6	%
Direct restaurant operating expenses		3,754,100	16.7	%		95,355	N/A		3,849,455		16.6	%

Restaurant-level IBO*	$	4,741,968	21.1	%	$	188,867	N/A	$	4,930,835		21.3	%

Occupancy									1,882,782		8.1	%
Pre-opening									105,887
Acquisition costs									868,293
General and administrative									2,450,104		10.6	%

Company-wide EBITDA*									(376,231	)	-1.6	%

Depreciation and amortization									1,471,692
Exit or disposal activities, other									201,140

Operating loss									(2,049,063	)

Interest:
Income									1,756
Expense									(1,034,449	)
Net interest expense									(1,032,693	)

Net loss								$	(3,081,756	)


Non-GAAP Reconciliations Q4 2011 Adjusted EBITDA

Net loss	$	(3,081,756	)

Net interest expense		1,032,693
Exit or disposal activities		17,274
Loss on disposal of assets		183,866
Depreciation and amortization		1,471,692
Pre-opening		105,887
Acquisition costs		868,293
Termination/contract negotiation costs		304,141
Share-based compensation		144,373
Lease adjustment		(1,013,027	)
Adjusted EBITDA*	$	33,436

*See accompanying disclosure regarding use of non-GAAP financial measures.

Certain percentages may not foot due to rounding.


Non-GAAP Reconciliations Fiscal Year 2012 Results

									Total for All
	Comparable		% of		New		% of		Restaurants As			% of
	Restaurants		Sales		Restaurants		Sales		Reported			Sales

Restaurant revenues	$	94,893,591	100	%	$	26,038,052	100	%	$	120,931,643		100	%

Cost of sales:
Food, beverage and retail		25,742,364	27.1	%		6,980,889	26.8	%		32,723,253		27.1	%
Labor		32,497,067	34.2	%		7,319,794	28.1	%		39,816,861		32.9	%
Direct restaurant operating expenses		13,918,768	14.7	%		4,243,858	16.3	%		18,162,626		15.0	%

Restaurant-level IBO*	$	22,735,392	24.0	%	$	7,493,511	28.8	%	$	30,228,903		25.0	%

Occupancy										9,999,277		8.3	%
Pre-opening										1,043,199
Acquisition costs										713,336
General and administrative										9,714,095		8.0	%

Company-wide EBITDA*										8,758,996		7.2	%

Depreciation and amortization										7,405,705
Exit or disposal activities, other										547,347

Operating loss										805,944

Interest:
Income										1,757
Expense										(4,913,182	)
Net interest expense										(4,911,425	)

Net loss									$	(4,105,481	)


Non-GAAP Reconciliations Fiscal Year 2012 Adjusted EBITDA

Net loss	$	(4,105,481	)

Net interest expense		4,911,425
Exit or disposal activities		64,839
Loss on disposal of assets		482,508
Depreciation and amortization		7,405,705
Pre-opening		1,043,199
Acquisition costs		713,336
Termination/contract negotiation costs		223,341
Share-based compensation		309,829
Lease adjustment		(4,071,746	)
Adjusted EBITDA*	$	6,976,955

*See accompanying disclosure regarding use of non-GAAP financial measures.

Certain percentages may not foot due to rounding.


Non-GAAP Reconciliations Fiscal Year 2011 Results

								Total for All
	Comparable		% of		New		% of	Restaurants			% of
	Restaurants		Sales		Restaurants		Sales	As Reported			Sales

Restaurant revenues	$	70,072,350	100	%	$	23,150,305	N/A	$	93,222,655		100	%

Cost of sales:
Food, beverage and retail		19,048,008	27.2	%		6,360,045	N/A		25,408,053		27.3	%
Labor		23,983,390	34.2	%		8,009,973	N/A		31,993,363		34.3	%
Direct restaurant operating expenses		10,410,269	14.9	%		3,849,470	N/A		14,259,739		15.3	%

Restaurant-level IBO*	$	16,630,683	23.7	%	$	4,930,817	N/A	$	21,561,500		23.1	%

Occupancy									7,133,428		7.7	%
Pre-opening									112,494
Acquisition costs									868,293
General and administrative									8,186,699		8.8	%

Company-wide EBITDA*									5,260,586		5.6	%

Depreciation and amortization									5,997,940
Exit or disposal activities, other									9,621

Operating loss									(746,975	)

Interest:
Income									5,953
Expense									(3,858,509	)
Net interest expense									(3,852,556	)

Net loss								$	(4,599,531	)


Non-GAAP Reconciliations Fiscal Year 2011 Adjusted EBITDA

Net loss	$	(4,599,531	)

Net interest expense		3,852,556
Exit or disposal activities		(139,625	)
Loss on disposal of assets		149,246
Depreciation and amortization		5,997,940
Pre-opening		112,494
Acquisition costs		868,293
Termination/contract negotiation costs		304,141
Share-based compensation		820,448
Lease adjustment		(4,355,841	)
Adjusted EBITDA*	$	3,010,121