Good Times Restaurants (GTIM) Q1 2025 earnings summary

Executive summary

• Net revenues for Q1 FY2025 increased 9.6% year-over-year to $36.3 million, driven by both Bad Daddy's and Good Times, with menu price increases and an extra week in the quarter contributing to growth.

• Net income attributable to common shareholders was $0.2 million ($0.02 per share), reversing a net loss in the prior year quarter.

• Adjusted EBITDA reached $1.2 million, up from $0.5 million year-over-year, highlighting stronger core profitability.

• Bad Daddy's saw a 1.5% increase in same-store sales and improved restaurant-level margins, while Good Times' same-store sales were flat and margins declined due to higher staffing costs.

• Both brands experienced significant sales declines in January due to severe weather, impacting early Q2 results.

Financial highlights

• Bad Daddy's total restaurant sales rose to $26.1 million, up $2 million year-over-year; Good Times sales increased to $9.9 million, up $1.1 million.

• Bad Daddy's restaurant-level operating profit was $3.3 million (12.6% of sales), up from $2.6 million (10.7%) last year; Good Times' margin dropped to 8.6% from 13.5%.

• Restaurant sales increased to $35.97 million from $32.95 million year-over-year.

• Adjusted EBITDA margin improved to 3.3% of revenues, up from 1.5% prior year.

• Cash and cash equivalents at quarter-end were $3.0 million.

Outlook and guidance

• Ground beef and labor costs are expected to rise throughout fiscal 2025 due to tightening supply and minimum wage hikes.

• General and administrative expenses are expected to remain around 7% of total revenues for the full year.

• Management anticipates sufficient capital to meet working capital and capital expenditure needs in FY2025, with funding from cash and the Cadence Credit Facility.

• Continued focus on menu innovation, brand modernization, and organic sales growth.