15 Aug 2019, 22:31 GMT+10
JACKSONVILLE, FL / ACCESSWIRE / August 15, 2019 / ARC Group, Inc. (OTCQB:RLLY), a restaurant holding company with a focus on diversified, full-service restaurants and brands, today provided a business update for the second quarter ended June 30, 2019.
Second Quarter 2019 Financial Highlights:
A reconciliation of EBITDA 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 pleased to report that revenue increased 276% to approximately $4.2 million for the second quarter of 2019 due to the continued growth of Dick's Wings & Grill®, as well as our Fat Patty's acquisition in 2018. We expect our organic growth to continue and we are actively evaluating additional acquisitions where we can leverage our franchising, marketing, operational, logistics and financial expertise across brands. We are also making progress with our pending acquisition of Tilted Kilt. Although this transaction has taken longer than anticipated, the acquisition remains on track and we look forward to providing further updates in the near future."
Alex Andre, CFO of ARC Group, commented, "Once again we have achieved positive EBITDA and, as we continue to increase revenue, we expect to significantly enhance our profitability. We believe our acquisition growth strategy targeting growing and profitable businesses, as well as underperforming businesses that can be quickly turned around, will position us with a unique, scalable and diversified portfolio. I am excited to be a part of the ARC team to help support the Company in this growth phase."
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 its condensed 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 EBITDA 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:
"EBITDA" means net loss plus depreciation expense, amortization expense and interest expense and income taxes.
For further information, please refer to the Company's Quarterly Report on Form 10-Q filed with the SEC on August 14, 2019 and available online at www.sec.gov.
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 25th 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 and several concession stands at TIAA Bank Field, and has 16 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.
Crescendo Communications, LLC
(tables to follow)
ARC Group, Inc.
Condensed Consolidated Balance Sheets (Unaudited)
|June 30,||December 31,|
Cash and cash equivalents
Accounts receivable, net
Ad funds receivable, net
Notes receivable, net
Other current assets
Total current assets
Notes receivable, net of current portion
Intangible assets, net
Property and equipment, net
Operating lease right-of-use assets
Financing lease right-of-use assets, net
Liabilities and stockholders' deficit
Accounts payable and accrued expenses
Accounts payable and accrued expenses - related party
Settlement agreements payable
Accrued legal contingency
Deferred franchise fees
Operating lease liability
Financing lease liability
Notes payable - related party, net
Gift card liabilities
Total current liabilities
Deferred franchise fees, net of current portion
Operating lease liability, net of current portion
Financing lease liability net of current portion
Class A common stock - $0.01 par value: 100,000,000 shares authorized,
7,080,771 and 6,680,065 shares issued and outstanding at
June 30, 2019 and December 31, 2018, respectively
Series A convertible preferred stock - $0.01 par value: 1,000,000 shares
authorized, 449,581 outstanding at June 30, 2019 and
December 31, 2018, respectively
Series B convertible preferred stock - $0.01 par value: 2,500,000 shares
authorized, -0- outstanding at June 30, 2019 and
December 31, 2018, respectively
Additional paid-in capital
Stock subscriptions payable
Total stockholders' deficit
Total liabilities and stockholders' deficit
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