Ark Restaurants Announces Financial Results for the Second Quarter of 2016

NEW YORK--()--Ark Restaurants Corp. (NASDAQ:ARKR) today reported financial results for the second quarter ended April 2, 2016.

Total revenues for the three-month period ended April 2, 2016 were $34,272,000 versus $31,548,000 for the three months ended March 28, 2015. The three-month period ended April 2, 2016 includes revenues related to Shuckers in Jensen Beach, FL which was acquired in October 2015 and the Southwest Porch in Bryant Park, NY which was opened in July 2015, totaling $1,944,000. Last year’s three-month period included revenues of $952,000 related to two properties closed during or subsequent to the quarter due to lease expirations.

Total revenues for the six-month period ended April 2, 2016 were $70,381,000 versus $64,906,000 for the six months ended March 28, 2015. The six-month period ended April 2, 2016 includes incremental revenues related to the Rustic Inn in Jupiter, FL, which opened in February 2015, Shuckers in Jensen Beach, FL, which was acquired in October 2015, and to Southwest Porch in Bryant Park, NY, which was opened on July 1, 2015, totaling $4,425,000. Last year’s six-month period included revenues of $2,029,000 related to four properties closed subsequent to the quarter-end due to lease expirations.

Company-wide same store sales increased 1.0% for the three-month period ended April 2, 2016 compared to the same three month period last year.

The Company’s EBITDA, adjusted for non-cash stock option expense and non-controlling interests, for the three-month period April 2, 2016 was $588,000 versus $490,000 during the same three-month period last year. Net loss for the three-month period ended April 2, 2016 was ($646,000), or ($0.19) per basic share and diluted share, compared to a net loss of ($583,000), or ($0.17) per basic share and diluted share, for the same three-month period last year.

The Company’s EBITDA adjusted for non-cash stock option expense and non-controlling interests for the six-month period ended April 2, 2016 was $2,370,000 versus $2,821,000 during the same six-month period last year. Net loss for the six-month period ended April 2, 2016 was ($324,000), or ($0.09) per basic share and diluted share, as compared to net income of $140,000, or $0.04 per basic and diluted share, for the same six-month period last year.

The decrease of $451,000 in EBITDA, as adjusted for non-cash stock option expense and non-controlling interests, for the six-month period ended April 2, 2016 as compared to the same period of last year, resulted primarily from higher operating payrolls.

As of April 2, 2016 the Company had cash and cash equivalents totaling $5,924,000. The Company has notes payable outstanding, the proceeds of which were used to finance the purchases of membership interests in Ark Hollywood/Tampa Investment, LLC, the purchase of The Rustic Inn in Dania Beach, Florida and the purchase of Shuckers, with an outstanding balance of $9,188,000, net of the unamortized balance of deferred financing costs in the amount of $110,000 at April 2, 2016.

Ark Restaurants owns and operates 22 restaurants and bars, 19 fast food concepts and catering operations primarily in New York City, Florida, Washington, D.C. and Las Vegas, NV. Six restaurants are located in New York City, three are located in Washington, D.C., five are located in Las Vegas, Nevada, three are located in Atlantic City, New Jersey, one is located at the Foxwoods Resort Casino in Ledyard, Connecticut, one is located in Boston, Massachusetts and three are located in Florida. The Las Vegas operations include four restaurants within the New York-New York Hotel & Casino Resort and operation of the hotel's room service, banquet facilities, employee dining room and six food court concepts and one restaurant within the Planet Hollywood Resort and Casino. In Atlantic City, New Jersey, the Company operates a restaurant and a bar in the Resorts Atlantic City Hotel and Casino and a restaurant in the Tropicana Hotel and Casino. The operations at the Foxwoods Resort Casino include one fast food concept and one restaurant. In Boston, Massachusetts, the Company operates a restaurant in the Faneuil Hall Marketplace. The Florida operations include two Rustic Inns, one in Dania Beach, Florida and one in Jupiter, Florida, Shuckers in Jensen Beach, Florida and the operation of five fast food facilities in Tampa, Florida and seven fast food facilities in Hollywood, Florida, each at a Hard Rock Hotel and Casino operated by the Seminole Indian Tribe at these locations.

Except for historical information, this news release contains forward-looking statements, within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These statements involve unknown risks, and uncertainties that may cause the Company's actual results or outcomes to be materially different from those anticipated and discussed herein. Important factors that might cause such differences are discussed in the Company's filings with the Securities and Exchange Commission. The Company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Actual results could differ materially from those anticipated in these forward-looking statements, if new information becomes available in the future.

               
ARK RESTAURANTS CORP.
Consolidated Statements of Income
For the 13 and 26-week periods ended April 2, 2016 and March 28, 2015
 
(In Thousands, Except per share amounts)
 
13 weeks ended 13 weeks ended 26 weeks ended 26 weeks ended
 
April 2, March 28, April 2, March 28,
  2016     2015     2016     2015  
 
TOTAL REVENUES $ 34,272   $ 31,548   $ 70,381   $ 64,906  
 
COST AND EXPENSES:
 
Food and beverage cost of sales 9,191 9,171 18,783 17,918
Payroll expenses 12,895 11,285 25,205 22,139
Occupancy expenses 4,037 3,823 8,583 8,016
Other operating costs and expenses 4,924 4,374 9,486 8,614
General and administrative expenses 2,712 2,431 6,040 5,431
Depreciation and amortization   1,136     1,098     2,275     2,203  
 
Total costs and expenses   34,895     32,182     70,372     64,321  
 
OPERATING INCOME (LOSS)   (623 )   (634 )   9     585  
 
OTHER (INCOME) EXPENSE:
 
Interest (income) expense, net 98 45 177 102
Other (income) expense, net   (160 )   (64 )   (222 )   (121 )
Total other income, net   (62 )   (19 )   (45 )   (19 )
 
INCOME (LOSS) BEFORE PROVISION (BENEFIT) FOR INCOME TAXES (561 ) (615 ) 54 604
 
Provision (benefit) for income taxes   (103 )   (173 )   35     168  
 
CONSOLIDATED NET INCOME (LOSS) (458 ) (442 ) 19 436
 
Net income attributable to non-controlling interests   (188 )   (141 )   (343 )   (296 )
 
NET INCOME (LOSS) ATTRIBUTABLE TO ARK RESTAURANTS CORP. $ (646 ) $ (583 ) $ (324 ) $ 140  
 
NET INCOME (LOSS) PER ARK RESTAURANTS CORP. COMMON SHARE:
Basic $ (0.19 ) $ (0.17 ) $ (0.09 ) $ 0.04  
Diluted $ (0.19 ) $ (0.17 ) $ (0.09 ) $ 0.04  
 
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING:
Basic   3,418     3,382     3,418     3,380  
Diluted   3,418     3,382     3,418     3,490  
 
 
EBITDA Reconciliation:
Pre tax income (loss) $ (561 ) $ (615 ) $ 54 $ 604
Depreciation and amortization 1,136 1,098 2,275 2,203
Interest expense, net   98     45     177     102  
EBITDA (a) $ 673   $ 528   $ 2,506   $ 2,909  
 
EBITDA adjusted for non-cash stock option expense,
and non-controlling interests:
EBITDA (as defined) (a) $ 673 $ 528 $ 2,506 $ 2,909
Net (income) loss attributable to non-controlling interests (188 ) (141 ) (343 ) (296 )
Non-cash stock option expense   103     103     207     208  
EBITDA, as adjusted $ 588   $ 490   $ 2,370   $ 2,821  
 
(a)   EBITDA is defined as earnings before interest, taxes, depreciation and amortization and cumulative effect of changes in accounting principle. Although EBITDA is not a measure of performance or liquidity calculated in accordance with generally accepted accounting principles (GAAP), the Company believes the use of this non-GAAP financial measure enhances an overall understanding of the Company's past financial performance as well as providing useful information to the investor because of its historical use by the Company as both a performance measure and measure of liquidity, and the use of EBITDA by virtually all companies in the restaurant sector as a measure of both performance and liquidity. However, investors should not consider this measure in isolation or as a substitute for net income (loss), operating income (loss), cash flows from operating activities or any other measure for determining the Company's operating performance or liquidity that is calculated in accordance with GAAP, it may not necessarily be comparable to similarly titled measures employed by other companies. A reconciliation of EBITDA to the most comparable GAAP financial measure, pre-tax income, is included above.

Contacts

Ark Restaurants Corp.
Robert Stewart, 212-206-8800
bstewart@arkrestaurants.com

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