August 05, 2020

Fiesta Restaurant Group, Inc. Reports Second Quarter 2020 Results

Both Brands Generated Positive Adjusted EBITDA during Quarter

Company Generated Net Cash Provided by Operations of $24.5 Million during Quarter

Sequential Improvement in Comparable Restaurant Sales Trend Extended through July

DALLAS--(BUSINESS WIRE)-- Fiesta Restaurant Group, Inc. ("Fiesta" or the "Company") (NASDAQ:FRGI), parent company of the Pollo Tropical® and Taco Cabana® restaurant brands, today reported results for the 13-week second quarter 2020, which ended on June 28, 2020 and provided a business update related to current operations.

Fiesta President and Chief Executive Officer Richard Stockinger said, "We are pleased with our sequential improvement in comparable restaurant sales at both brands, which continued into July. Comp sales run rates at both brands improved from June to July by 350 basis points or more. These encouraging trends have been achieved despite the fact that we operate in Florida and Texas, two of the more challenged states in terms of COVID outbreaks, which drove our decision to again close our dining rooms as of July 12, 2020. As we continue to prioritize the well-being of our team members and guests during this pandemic, we believe we are also evolving to a better business model that is easier and safer for our consumers including expanded delivery options, new curbside and pick-up capabilities, and a much-enhanced online ordering experience. Our new app, developed by BottleRocket, went live for Pollo Tropical in late July and will go live for Taco Cabana in September."

"We also continued to make progress on improving our financial position and liquidity during the quarter. In addition to securing an amendment to our senior credit facility that we believe provides us adequate covenant cushion and liquidity, we generated positive Adjusted EBITDA at both brands for the quarter and also generated net cash provided by operating activities of $24.5 million through better working capital management and positive Adjusted EBITDA from both brands. Since the beginning of the COVID crisis, we have significantly reduced our revolving credit facility(1) and net revolver debt balances(2). At current sales trends, we believe we will continue to improve liquidity."

Mr. Stockinger concluded, "We are proud of our operations team that has continued to keep our restaurants operating safely during this crisis while improving operations efficiency. In the second half of the year, we expect to see the accelerating effects of our off-premise initiatives as they gain traction, including curbside capabilities and our new apps at both brands. We are optimistic about our future and our ability to continue evolving our business model to meet changing market conditions and consumer needs in order to allow our customers to enjoy our brands safely and conveniently across all channels—however the guest chooses."

________

(1) 

 

Outstanding revolving credit facility balance plus outstanding letters of credit.

(2)

 

We define net revolver debt as outstanding revolving credit facility borrowings plus outstanding letters of credit less unrestricted cash. Net revolver debt is a non-GAAP measure which we believe assists investors in understanding of our management of our overall liquidity and financial flexibility.

Second Quarter 2020 Financial Summary

  • Total revenues decreased 28.9% to $121.9 million in the second quarter of 2020 from $171.4 million in the second quarter of 2019;
  • Comparable restaurant sales at Pollo Tropical decreased 31.6%;
  • Comparable restaurant sales at Taco Cabana decreased 19.2%;
  • Net loss of $8.3 million, or $0.33 per diluted share, in the second quarter of 2020 compared to net loss of $43.4 million, or $1.62 per diluted share, in the second quarter of 2019, which included the unfavorable impact of $46.5 million, or $1.73 per diluted share, related to a non-cash impairment of goodwill;
  • Adjusted net loss (a non-GAAP financial measure) of $2.9 million, or $0.11 per diluted share, in the second quarter of 2020, compared to adjusted net income of $5.7 million, or $0.21 per diluted share, in the second quarter of 2019 (see non-GAAP reconciliation table below);
  • Adjusted EBITDA for Pollo Tropical of $5.0 million in the second quarter of 2020 compared to $14.6 million in the second quarter of 2019;
  • Restaurant-level Adjusted EBITDA (a non-GAAP financial measure) for Pollo Tropical of $10.3 million, or 16.3% of Pollo Tropical restaurant sales, in the second quarter of 2020 compared to $21.4 million, or 23.1% of Pollo Tropical restaurant sales, in the second quarter of 2019 (see non-GAAP reconciliation table below);
  • Adjusted EBITDA for Taco Cabana of $2.7 million in the second quarter of 2020 compared to $4.1 million in the second quarter of 2019;
  • Restaurant-level Adjusted EBITDA (a non-GAAP financial measure) for Taco Cabana of $7.3 million, or 12.6% of Taco Cabana restaurant sales, in the second quarter of 2020 compared to $9.5 million, or 12.1% of Taco Cabana restaurant sales, in the second quarter of 2019 (see non-GAAP reconciliation table below); and
  • Consolidated Adjusted EBITDA (a non-GAAP financial measure) of $7.7 million in the second quarter of 2020 compared to Consolidated Adjusted EBITDA of $18.8 million in the second quarter of 2019 (see non-GAAP reconciliation table below).

Second Quarter 2020 and Fiscal July Comparable Restaurant Sales Summary

     

 

Fiscal April

Fiscal May

Fiscal June

Second
Quarter 2020

Fiscal July

     

Pollo Tropical

-49.2%

-27.9%

-17.8%

-31.6%

-13.8%

     

Taco Cabana

-26.2%

-14.5%

-18.0%

-19.2%

-14.4%

  • Due to ongoing uncertainty and volatility surrounding the COVID-19 pandemic and guidelines, effective July 12, 2020, we closed all of our dining rooms until further notice to ensure team member and guest safety. We continue to operate our restaurants for drive-thru, delivery and pick up, and we are accelerating efforts to better enable our customers to enjoy our brands safely and conveniently across all channels—wherever and whenever they choose.

Cash and Liquidity

  • At the end of the second quarter of 2020, we had $101.4 million in cash and $148.5 million in debt, which includes $146.5 million outstanding under our amended senior credit facility and $2.0 million in capital lease obligations.
  • As previously announced, we completed the amendment to our senior credit facility on July 10, 2020. Under this amendment, our available revolving credit borrowings under the amended senior credit facility will be reduced from $150 million to $95 million in a phased reduction beginning with a $30 million permanent reduction at the closing of the amendment on July 10, 2020, a $15 million reduction in the fourth quarter of 2020, and a $10 million reduction in the first quarter of 2021. We repaid borrowings under our amended senior credit facility as follows: $30.0 million on July 10, 2020, pursuant to the terms of the amended senior credit facility, and an additional $62.5 million through July 31, 2020. On July 31, 2020, there were $54.0 million in outstanding revolving credit borrowings under our amended senior credit facility. In addition, as of July 31, 2020, we were current on all lease obligations.
  • We have aggressively cut our capital expenditure budget for 2020. Capital expenditures in the first half of 2020 totaled $8.7 million compared to $21.7 million in the first half of 2019. 2020 full year capital expenditures will not exceed $22.0 million.
  • From the beginning of the COVID-19 pandemic in mid-March through late July, we significantly reduced our total debt, revolving credit facility and net revolver debt(3) balances. On March 18, 2020, we had a total debt balance of $148.4 million, an outstanding revolving credit facility balance (including letters of credit) of $149.9 million and net revolver debt(3) of $74.4 million. As of July 31, 2020, our total debt balance was $56.0 million, our outstanding revolving credit facility balance (including letters of credit) was $57.5 million and our net revolver debt (3) was $48.4 million.
  • Working capital efficiency has been significantly improved as a result of vendor payment term extensions and pricing renegotiations, which contributed to cash flows from operations of $24.5 million during the second quarter of 2020. We believe that a significant portion of the improvement in working capital efficiency represent sustainable improvements in cash flow. We are also marketing 16 owned properties for sale or sale-leaseback, which are expected to result in cash flow increases, although there can be no assurance that any such sales or sale-leaseback transactions will be consummated.

Second Quarter 2020 Brand Results

Total Pollo Tropical restaurant sales decreased 31.7% to $63.3 million in the second quarter of 2020 compared to $92.6 million in the second quarter of 2019 primarily due to a comparable restaurant sales decrease of 31.6%. Comparable restaurant sales for Pollo Tropical accelerated significantly through the second quarter, from a decrease of 49.2% in April to a decrease of 17.8% in June. Off premise sales consisting of online, catering, and delivery orders comprised 11.5% of total restaurant sales in the second quarter of 2020 compared to 4.0% of total restaurant sales in the second quarter of 2019.

Sales cannibalization from new restaurants on existing restaurants negatively impacted comparable restaurant sales by approximately 20 basis points. The decrease in comparable restaurant sales resulted from a 38.2% decrease in comparable restaurant transactions and a 6.6% increase in the net impact of pricing and product/channel mix. The increase in pricing and product/channel mix was driven primarily by increases in delivery and drive-thru average check and sales channel penetration, and menu price increases of 0.2%.

Adjusted EBITDA for Pollo Tropical decreased to $5.0 million in the second quarter of 2020 from $14.6 million in the second quarter of 2019. The decrease was primarily due to the impact of lower comparable restaurant sales. Cost of sales, restaurant wages, rent expense, and other restaurant operating expenses increased as a percentage of restaurant sales—driven in large part by the impact of lower comparable restaurant sales. This was partially offset by lower advertising expense. Pollo Tropical incurred incremental costs related to COVID-19 of $1.6 million for the quarter including special incentive pay, quarantine pay, and costs related to masks and sanitizer. In order to support the community, Pollo Tropical also offered additional discounts to first responders and healthcare workers and free kids meals due to school cancellations during the second quarter. Restaurant wages and related expenses increased as a percentage of restaurant sales as a result of COVID-19 incentives and quarantine pay. Driven by efficiency initiatives, management and hourly wage costs as a percentage of sales improved compared to last year by 0.9% (excluding COVID-19 incentives and quarantine pay).

Taco Cabana restaurant sales decreased 25.4% to $58.3 million in the second quarter of 2020 from $78.1 million in the second quarter of 2019 due primarily to a comparable restaurant sales decrease of 19.2% along with a decrease in sales related to closed restaurants. Comparable restaurant sales for Taco Cabana improved through the second quarter, from a decrease of 26.2% in April to a decrease of 18.0% in June. Off premise sales consisting of online, catering, and delivery orders comprised 8.0% of total restaurant sales in the second quarter of 2020 compared to 3.7% of total restaurant sales in the second quarter of 2019. The decrease in comparable restaurant sales resulted from a 29.0% decrease in comparable restaurant transactions and a 9.8% increase in the net impact of product/channel mix. The increase in product/channel mix was driven primarily by increases in drive-thru and delivery sales channel penetration and growth in average check for drive-thru versus last year due in part to an increase in transactions that include alcohol.

Adjusted EBITDA for Taco Cabana decreased to $2.7 million from $4.1 million in the second quarter of 2019. The decrease was primarily due to the impact of lower comparable restaurant sales. Restaurant wages, rent expense and other operating expenses increased as a percentage of Taco Cabana restaurant sales—driven in large part by the impact of lower comparable restaurant sales. This was partially offset by lower cost of sales as a percentage of restaurant sales and advertising expense. Taco Cabana incurred incremental costs related to COVID-19 of $1.8 million for the quarter including special incentive pay, quarantine pay, and costs related to masks and sanitizer. In order to support the community, Taco Cabana also offered additional discounts to first responders and healthcare workers and free kids meals due to school cancellations during the second quarter. Restaurant wages and related expenses increased as a percentage of restaurant sales as a result of COVID-19 incentives and quarantine pay. Driven by efficiency initiatives, management and hourly wage costs as a percentage of sales improved compared to last year by 2.1% (excluding COVID-19 incentives and quarantine pay).

________

(3) 

 

Total debt is comprised of capital lease obligations of $2.0 million as of March 18, 2020 and July 31, 2020 and outstanding revolving credit facility borrowings. We define net revolver debt as outstanding revolving credit facility borrowings plus outstanding letters of credit less unrestricted cash balance, which were $146.4 million, $3.5 million and $75.5 million, respectively, as of March 18, 2020 and $54.0 million, $3.5 million and $9.1 million, respectively, as of July 31, 2020. Net revolver debt is a non-GAAP measure which we believe assists investors in understanding of our management of our overall liquidity and financial flexibility.

Restaurant Portfolio

As of June 28, 2020, there were 141 Company-owned Pollo Tropical restaurants, 146 Company-owned Taco Cabana restaurants, 33 franchised Pollo Tropical restaurants in the U.S., Puerto Rico, Panama, Guyana, Ecuador and the Bahamas, and seven franchised Taco Cabana restaurants in the U.S.

Investor Conference Call Today

We will host a conference call at 4:30 p.m. ET today. The conference call can be accessed live over the phone by dialing 631-891-4304. A replay will be available after the call until Wednesday, August 12, 2020 and can be accessed by dialing 412-317-6671. The passcode is 10010440. The conference call will also be webcast live from the corporate website at www.frgi.com, under the Investor Relations section. A replay of the webcast will be available through the corporate website shortly after the call has concluded.

About Fiesta Restaurant Group, Inc.

Fiesta Restaurant Group, Inc., owns, operates and franchises the Pollo Tropical® and Taco Cabana® restaurant brands. The brands specialize in the operation of fast casual/quick service restaurants that offer distinct and unique flavors with broad appeal at a compelling value. The brands feature fresh-made cooking, drive-thru service and catering. For more information about Fiesta Restaurant Group, Inc., visit the corporate website at www.frgi.com.

Forward Looking Statements

Certain statements contained in this news release and in our public disclosures, whether written, oral or otherwise made, relating to future events or future performance, including any discussion, express or implied regarding our anticipated growth, plans, objectives and the impact of our initiatives designed to strengthen our liquidity and cash position, including those related to working capital efficiency initiatives and sales of real property, our investments in strategic and sales building initiatives, including those relating to advertising and marketing, operations improvements, menu development and simplification, digital ordering and online sales, catering and third-party delivery and the impact of the recent COVID-19 outbreak and our initiatives designed to respond to the COVID-19 outbreak on future sales, margins, earnings and liquidity, contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements are often identified by the words "may," "might," "believes," "thinks," "anticipates," "plans," "positioned," "target," "continue," "expects," "look to," "intends" and other similar expressions, whether in the negative or the affirmative, that are not statements of historical fact. These forward-looking statements are not guarantees of future performance and involve certain risks, uncertainties, and assumptions that are difficult to predict, and you should not place undue reliance on our forward-looking statements. Our actual results and timing of certain events could differ materially from those anticipated in these forward-looking statements as a result of certain factors, including, but not limited to, those discussed from time to time in our reports filed with the Securities and Exchange Commission, including our Annual Report on Form 10-K for the fiscal year ended December 29, 2019 and our quarterly reports on Form 10-Q. All forward-looking statements and the internal projections and beliefs upon which we base our expectations included in this release are made only as of the date of this release and may change. While we may elect to update forward-looking statements at some point in the future, we expressly disclaim any obligation to update any forward-looking statements, whether as a result of new information, future events, or otherwise.

FIESTA RESTAURANT GROUP, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

THREE AND SIX MONTHS ENDED JUNE 28, 2020 AND JUNE 30, 2019

(In thousands, except share and per share data)

(Unaudited)

 

 

Three Months Ended (a)

 

Six Months Ended (a)

 

June 28, 2020

 

June 30, 2019

 

June 28, 2020

 

June 30, 2019

Revenues:

 

 

 

 

 

 

 

Restaurant sales

$

121,547

 

 

$

170,713

 

 

$

267,633

 

 

$

335,894

 

Franchise royalty revenues and fees

321

 

 

668

 

 

934

 

 

1,339

 

Total revenues

121,868

 

 

171,381

 

 

268,567

 

 

337,233

 

Costs and expenses:

 

 

 

 

 

 

 

Cost of sales

37,807

 

 

53,758

 

 

84,083

 

 

104,268

 

Restaurant wages and related expenses (b)

33,747

 

 

45,766

 

 

74,242

 

 

90,802

 

Restaurant rent expense

11,279

 

 

11,898

 

 

22,618

 

 

23,643

 

Other restaurant operating expenses

18,989

 

 

22,513

 

 

40,500

 

 

44,276

 

Advertising expense

2,143

 

 

5,883

 

 

7,926

 

 

11,404

 

General and administrative expenses (b)(c)

12,288

 

 

13,496

 

 

26,672

 

 

28,567

 

Depreciation and amortization

9,565

 

 

9,807

 

 

18,995

 

 

19,355

 

Pre-opening costs

 

 

385

 

 

69

 

 

786

 

Impairment and other lease charges (d)

2,285

 

 

1,751

 

 

6,518

 

 

1,413

 

Goodwill impairment (e)

 

 

46,485

 

 

 

 

46,485

 

Closed restaurant rent, net of sublease income (f)

1,830

 

 

1,335

 

 

3,462

 

 

2,759

 

Other expense (income), net (g)

784

 

 

154

 

 

1,692

 

 

856

 

Total operating expenses

130,717

 

 

213,231

 

 

286,777

 

 

374,614

 

Loss from operations

(8,849

)

 

(41,850

)

 

(18,210

)

 

(37,381

)

Interest expense

1,237

 

 

967

 

 

2,198

 

 

2,201

 

Loss before income taxes

(10,086

)

 

(42,817

)

 

(20,408

)

 

(39,582

)

Provision for (benefit from) income taxes (h)

(1,743

)

 

623

 

 

(4,748

)

 

1,569

 

Net loss

$

(8,343

)

 

$

(43,440

)

 

$

(15,660

)

 

$

(41,151

)

Earnings (loss) per common share:

 

 

 

 

 

 

 

Basic

$

(0.33

)

 

$

(1.62

)

 

$

(0.62

)

 

$

(1.53

)

Diluted

(0.33

)

 

(1.62

)

 

(0.62

)

 

(1.53

)

Weighted average common shares outstanding:

 

 

 

 

 

 

 

Basic

25,267,404

 

 

26,807,068

 

 

25,393,325

 

 

26,825,286

 

Diluted

25,267,404

 

 

26,807,068

 

 

25,393,325

 

 

26,825,286

 

(a)

 

The Company uses a 52- or 53-week fiscal year that ends on the Sunday closest to December 31. The three- and six-month periods ended June 28, 2020 and June 30, 2019 each included 13 and 26 weeks, respectively.

(b)

 

Restaurant wages and related expenses include stock-based compensation of $69 and $16 for the three months ended June 28, 2020 and June 30, 2019, respectively, and $105 and $43 for the six months ended June 28, 2020 and June 30, 2019, respectively. General and administrative expenses include stock-based compensation expense of $959 and $719 for the three months ended June 28, 2020 and June 30, 2019, respectively, and $1,735 and $1,484 for the six months ended June 28, 2020 and June 30, 2019, respectively.

(c)

 

See notes (g) and (h) to the reconciliation of net income (loss) to adjusted net income (loss) in the tables titled "Supplemental Non-GAAP Information."

(d)

 

See note (c) to the reconciliation of net income (loss) to adjusted net income (loss) in the tables titled "Supplemental Non-GAAP Information."

(e)

 

See note (d) to the reconciliation of net income (loss) to adjusted net income (loss) in the tables titled "Supplemental Non-GAAP Information."

(f)

 

See note (e) to the reconciliation of net income (loss) to adjusted net income (loss) in the tables titled "Supplemental Non-GAAP Information."

(g)

 

See note (f) to the reconciliation of net income (loss) to adjusted net income (loss) in the tables titled "Supplemental Non-GAAP Information."

(h)

 

See notes (a) and (b) to the reconciliation of net income (loss) to adjusted net income (loss) in the tables titled "Supplemental Non-GAAP Information."

FIESTA RESTAURANT GROUP, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands)

(Unaudited)

 

 

June 28, 2020

 

December 29, 2019

 

 

 

 

Assets

 

 

 

Cash

$

101,375

 

 

$

13,413

 

Other current assets

38,986

 

 

25,870

 

Property and equipment, net

187,928

 

 

211,944

 

Operating lease right-of-use assets

257,654

 

 

251,272

 

Goodwill

56,307

 

 

56,307

 

Other assets

8,134

 

 

9,835

 

Total assets

$

650,384

 

 

$

568,641

 

 

 

 

 

Liabilities and Stockholders' Equity

 

 

 

Current liabilities

$

79,097

 

 

$

63,620

 

Long-term debt, net of current portion

148,233

 

 

76,823

 

Operating lease liabilities

264,157

 

 

256,798

 

Deferred tax liabilities

7,866

 

 

4,759

 

Other non-current liabilities

10,343

 

 

8,405

 

Total liabilities

509,696

 

 

410,405

 

Stockholders' equity

140,688

 

 

158,236

 

Total liabilities and stockholders' equity

$

650,384

 

 

$

568,641

 

FIESTA RESTAURANT GROUP, INC.

Supplemental Information

The following table sets forth certain unaudited supplemental financial and other data for the periods indicated

(In thousands, except percentages):

 

 

(Unaudited)

 

(Unaudited)

 

Three Months Ended

 

Six Months Ended

 

June 28, 2020

 

June 30, 2019

 

June 28, 2020

 

June 30, 2019

Segment revenues:

 

 

 

 

 

 

 

Pollo Tropical

$

63,438

 

 

$

93,058

 

 

$

149,563

 

 

$

184,539

 

Taco Cabana

58,430

 

 

78,323

 

 

119,004

 

 

152,694

 

Total revenues

$

121,868

 

 

$

171,381

 

 

$

268,567

 

 

$

337,233

 

 

 

 

 

 

 

 

 

Change in comparable restaurant sales (a):

 

 

 

 

 

 

 

Pollo Tropical

(31.6

)%

 

(1.3

)%

 

(19.5

)%

 

(1.9

)%

Taco Cabana

(19.2

)%

 

(3.0

)%

 

(16.4

)%

 

(1.8

)%

 

 

 

 

 

 

 

 

Average sales per Company-owned restaurant:

 

 

 

 

 

 

 

Pollo Tropical

 

 

 

 

 

 

 

Comparable restaurants (b)

$

461

 

 

$

677

 

 

$

1,076

 

 

$

1,347

 

New restaurants (c)

369

 

 

452

 

 

857

 

 

887

 

Total Company-owned (d)

458

 

 

662

 

 

1,067

 

 

1,316

 

Taco Cabana

 

 

 

 

 

 

 

Comparable restaurants (b)

$

399

 

 

$

476

 

 

$

809

 

 

$

935

 

New restaurants (c)

435

 

 

482

 

 

740

 

 

920

 

Total Company-owned (d)

399

 

 

476

 

 

806

 

 

933

 

 

 

 

 

 

 

 

 

Income (loss) before income taxes:

 

 

 

 

 

 

 

Pollo Tropical

$

(5,186

)

 

$

6,918

 

 

$

(7,013

)

 

$

12,874

 

Taco Cabana

(4,900

)

 

(49,735

)

 

(13,395

)

 

(52,456

)

 

 

 

 

 

 

 

 

Adjusted EBITDA:

 

 

 

 

 

 

 

Pollo Tropical

$

4,993

 

 

$

14,646

 

 

$

13,773

 

 

$

28,963

 

Taco Cabana

2,672

 

 

4,120

 

 

1,765

 

 

7,015

 

 

 

 

 

 

 

 

 

Restaurant-level Adjusted EBITDA (e):

 

 

 

 

 

 

 

Pollo Tropical

$

10,338

 

 

$

21,432

 

 

$

25,772

 

 

$

42,601

 

Taco Cabana

7,313

 

 

9,479

 

 

12,597

 

 

18,943

 

(a)

 

Restaurants are included in comparable restaurant sales after they have been open for 18 months or longer.

(b)

 

Comparable restaurants are restaurants that have been open for 18 months or longer. Average sales for comparable Company-owned restaurants are derived by dividing comparable restaurant sales for such period for the applicable segment by the average number of comparable restaurants for the applicable segment for such period.

(c)

 

New restaurants are restaurants that have been open for less than 18 months. Average sales for new Company-owned restaurants are derived by dividing new restaurant sales for such period for the applicable segment by the average number of new restaurants for the applicable segment for such period.

(d)

 

Average sales for total Company-owned restaurants are derived by dividing restaurant sales for such period for the applicable segment by the average number of open restaurants for the applicable segment for such period.

(e)

 

Restaurant-level Adjusted EBITDA is a non-GAAP financial measure. Please see the reconciliation from net income (loss) to Restaurant-level Adjusted EBITDA in the table titled "Supplemental Non-GAAP Information."

FIESTA RESTAURANT GROUP, INC.

Supplemental Information

The following table sets forth certain unaudited supplemental data for the periods indicated:

 

 

Three Months Ended

 

Six Months Ended

 

June 28, 2020

 

June 30, 2019

 

June 28, 2020

 

June 30, 2019

 

 

 

 

 

 

 

 

Company-owned restaurant openings:

 

 

 

 

 

 

 

Pollo Tropical

 

 

1

 

 

 

 

1

 

Taco Cabana

 

 

1

 

 

1

 

 

3

 

Total new restaurant openings

 

 

2

 

 

1

 

 

4

 

 

 

 

 

 

 

 

 

Company-owned restaurant closings:

 

 

 

 

 

 

 

Pollo Tropical

 

 

 

 

(1

)

 

 

Taco Cabana

 

 

 

 

(19

)

 

 

Net change in restaurants

 

 

2

 

 

(19

)

 

4

 

 

 

 

 

 

 

 

 

Number of Company-owned restaurants:

 

 

 

 

 

 

 

Pollo Tropical

141

 

 

140

 

 

141

 

 

140

 

Taco Cabana

146

 

 

165

 

 

146

 

 

165

 

Total Company-owned restaurants

287

 

 

305

 

 

287

 

 

305

 

 

 

 

 

 

 

 

 

Number of franchised restaurants:

 

 

 

 

 

 

 

Pollo Tropical

33

 

 

31

 

 

33

 

 

31

 

Taco Cabana

7

 

 

8

 

 

7

 

 

8

 

Total franchised restaurants

40

 

 

39

 

 

40

 

 

39

 

 

 

 

 

 

 

 

 

Total number of restaurants:

 

 

 

 

 

 

 

Pollo Tropical

174

 

 

171

 

 

174

 

 

171

 

Taco Cabana

153

 

 

173

 

 

153

 

 

173

 

Total restaurants

327

 

 

344

 

 

327

 

 

344

 

FIESTA RESTAURANT GROUP, INC.

Supplemental Information

The following table sets forth certain unaudited supplemental financial and other data for the periods indicated

(In thousands, except percentages):

 

 

Three Months Ended

 

June 28, 2020

 

June 30, 2019

Pollo Tropical:

 

(a)

 

 

(a)

Restaurant sales

$

63,292

 

 

 

$

92,620

 

 

Cost of sales

20,321

 

32.1

%

 

29,318

 

31.7

%

Restaurant wages and related expenses

15,108

 

23.9

%

 

21,290

 

23.0

%

Restaurant rent expense

5,660

 

8.9

%

 

5,495

 

5.9

%

Other restaurant operating expenses

10,714

 

16.9

%

 

11,900

 

12.8

%

Advertising expense

1,178

 

1.9

%

 

3,189

 

3.4

%

Depreciation and amortization

5,233

 

8.3

%

 

5,376

 

5.8

%

Pre-opening costs

 

%

 

153

 

0.2

%

Impairment and other lease charges

1,932

 

3.1

%

 

52

 

0.1

%

Closed restaurant rent expense, net of sublease income

671

 

1.1

%

 

1,039

 

1.1

%

 

 

 

 

 

 

Taco Cabana:

 

 

 

 

 

Restaurant sales

$

58,255

 

 

 

$

78,093

 

 

Cost of sales

17,486

 

30.0

%

 

24,440

 

31.3

%

Restaurant wages and related expenses

18,639

 

32.0

%

 

24,476

 

31.3

%

Restaurant rent expense

5,619

 

9.6

%

 

6,403

 

8.2

%

Other restaurant operating expenses

8,275

 

14.2

%

 

10,613

 

13.6

%

Advertising expense

965

 

1.7

%

 

2,694

 

3.4

%

Depreciation and amortization

4,332

 

7.4

%

 

4,431

 

5.7

%

Pre-opening costs

 

%

 

232

 

0.3

%

Impairment and other lease charges

353

 

0.6

%

 

1,699

 

2.2

%

Goodwill impairment

 

%

 

46,485

 

59.5

%

Closed restaurant rent expense, net of sublease income

1,159

 

2.0

%

 

296

 

0.4

%

 

 

 

 

 

 

 

 

 

 

 

 

 

Six Months Ended

 

June 28, 2020

 

June 30, 2019

Pollo Tropical:

 

(a)

 

 

(a)

Restaurant sales

$

149,013

 

 

 

$

183,646

 

 

Cost of sales

48,052

 

32.2

%

 

57,616

 

31.4

%

Restaurant wages and related expenses

36,145

 

24.3

%

 

42,443

 

23.1

%

Restaurant rent expense

11,300

 

7.6

%

 

10,916

 

5.9

%

Other restaurant operating expenses

23,100

 

15.5

%

 

23,858

 

13.0

%

Advertising expense

4,682

 

3.1

%

 

6,221

 

3.4

%

Depreciation and amortization

10,511

 

7.1

%

 

10,589

 

5.8

%

Pre-opening costs

 

%

 

239

 

0.1

%

Impairment and other lease charges

5,628

 

3.8

%

 

(327

)

(0.2

)%

Closed restaurant rent expense, net of sublease income

1,273

 

0.9

%

 

2,183

 

1.2

%

 

 

 

 

 

 

Taco Cabana:

 

 

 

 

 

Restaurant sales

$

118,620

 

 

 

$

152,248

 

 

Cost of sales

36,031

 

30.4

%

 

46,652

 

30.6

%

Restaurant wages and related expenses

38,097

 

32.1

%

 

48,359

 

31.8

%

Restaurant rent expense

11,318

 

9.5

%

 

12,727

 

8.4

%

Other restaurant operating expenses

17,400

 

14.7

%

 

20,418

 

13.4

%

Advertising expense

3,244

 

2.7

%

 

5,183

 

3.4

%

Depreciation and amortization

8,484

 

7.2

%

 

8,766

 

5.8

%

Pre-opening costs

69

 

0.1

%

 

547

 

0.4

%

Impairment and other lease charges

890

 

0.8

%

 

1,740

 

1.1

%

Goodwill impairment

 

%

 

46,485

 

30.5

%

Closed restaurant rent expense, net of sublease income

2,189

 

1.8

%

 

576

 

0.4

%

(a)

 

Percent of restaurant sales for the applicable segment.

FIESTA RESTAURANT GROUP, INC.
Supplemental Non-GAAP Information
The following table sets forth certain unaudited supplemental financial data for the periods indicated
(In thousands):

Consolidated Adjusted EBITDA and Restaurant-level Adjusted EBITDA are non-GAAP financial measures. Adjusted EBITDA is defined as earnings (loss) attributable to the applicable operating segments before interest expense, income taxes, depreciation and amortization, impairment and other lease charges, goodwill impairment, closed restaurant rent expense, net of sublease income, stock-based compensation expense, other expense (income), net, and certain significant items for each segment that are related to strategic changes and/or are not related to the ongoing operation of our restaurants as set forth in the reconciliation table below. Adjusted EBITDA for each of our segments includes an allocation of general and administrative expenses associated with administrative support for executive management, information systems and certain finance, legal, supply chain, human resources, construction and other administrative functions. Restaurant-level Adjusted EBITDA is defined as Adjusted EBITDA excluding franchise royalty revenues and fees, pre-opening costs and general and administrative expenses (including corporate-level general and administrative expenses).

Adjusted EBITDA for each of our segments is the primary measure of segment profit or loss used by our chief operating decision maker for purposes of allocating resources to our segments and assessing their performance. In addition, management believes that Consolidated Adjusted EBITDA and Restaurant-level Adjusted EBITDA, when viewed with our results of operations calculated in accordance with GAAP and our reconciliation of net income (loss) to Consolidated Adjusted EBITDA and Restaurant-level Adjusted EBITDA (i) provide useful information about our operating performance and period-over-period changes, (ii) provide additional information that is useful for evaluating the operating performance of our business, and (iii) permit investors to gain an understanding of the factors and trends affecting our ongoing earnings, from which capital investments are made and debt is serviced. However, such measures are not measures of financial performance or liquidity under GAAP and, accordingly, should not be considered as alternatives to net income or cash flow from operating activities as indicators of operating performance or liquidity. Also, these measures may not be comparable to similarly titled captions of other companies.

Three Months Ended

 

Pollo Tropical

 

Taco Cabana

 

Consolidated

June 28, 2020:

 

 

 

 

 

 

Net loss

 

 

 

 

 

$

(8,343

)

Benefit from income taxes

 

 

 

 

 

(1,743

)

Loss before taxes

 

$

(5,186

)

 

$

(4,900

)

 

$

(10,086

)

Add:

 

 

 

 

 

 

Non-general and administrative expense adjustments:

 

 

 

 

 

 

Depreciation and amortization

 

5,233

 

 

4,332

 

 

9,565

 

Impairment and other lease charges

 

1,932

 

 

353

 

 

2,285

 

Interest expense

 

625

 

 

612

 

 

1,237

 

Closed restaurant rent expense, net of sublease income

 

671

 

 

1,159

 

 

1,830

 

Other expense (income), net

 

644

 

 

140

 

 

784

 

Stock-based compensation expense in restaurant wages

 

27

 

 

42

 

 

69

 

Total non-general and administrative expense adjustments

 

9,132

 

 

6,638

 

 

15,770

 

General and administrative expense adjustments:

 

 

 

 

 

 

Stock-based compensation expense

 

523

 

 

436

 

 

959

 

Restructuring costs and retention bonuses

 

452

 

 

439

 

 

891

 

Digital and brand repositioning costs

 

72

 

 

59

 

 

131

 

Total general and administrative expense adjustments

 

1,047

 

 

934

 

 

1,981

 

Adjusted EBITDA

 

$

4,993

 

 

$

2,672

 

 

$

7,665

 

Restaurant-level adjustments:

 

 

 

 

 

 

Add: Other general and administrative expense(1)

 

5,491

 

 

4,816

 

 

10,307

 

Less: Franchise royalty revenue and fees

 

146

 

 

175

 

 

321

 

Restaurant-level Adjusted EBITDA

 

$

10,338

 

 

$

7,313

 

 

$

17,651

 

 

 

 

 

 

 

 

June 30, 2019:

 

 

 

 

 

 

Net loss

 

 

 

 

 

$

(43,440

)

Provision for income taxes

 

 

 

 

 

623

 

Income (loss) before taxes

 

$

6,918

 

 

$

(49,735

)

 

$

(42,817

)

Add:

 

 

 

 

 

 

Non-general and administrative expense adjustments:

 

 

 

 

 

 

Depreciation and amortization

 

5,376

 

 

4,431

 

 

9,807

 

Impairment and other lease charges

 

52

 

 

1,699

 

 

1,751

 

Goodwill impairment

 

 

 

46,485

 

 

46,485

 

Interest expense

 

480

 

 

487

 

 

967

 

Closed restaurant rent expense, net of sublease income

 

1,039

 

 

296

 

 

1,335

 

Other expense (income), net

 

148

 

 

6

 

 

154

 

Stock-based compensation expense in restaurant wages

 

4

 

 

12

 

 

16

 

Total non-general and administrative expense adjustments

 

7,099

 

 

53,416

 

 

60,515

 

General and administrative expense adjustments:

 

 

 

 

 

 

Stock-based compensation expense

 

351

 

 

368

 

 

719

 

Restructuring costs and retention bonuses

 

278

 

 

71

 

 

349

 

Total general and administrative expense adjustments

 

629

 

 

439

 

 

1,068

 

Adjusted EBITDA

 

$

14,646

 

 

$

4,120

 

 

$

18,766

 

Restaurant-level adjustments:

 

 

 

 

 

 

Add: Pre-opening costs

 

153

 

 

232

 

 

385

 

Add: Other general and administrative expense(1)

 

7,071

 

 

5,357

 

 

12,428

 

Less: Franchise royalty revenue and fees

 

438

 

 

230

 

 

668

 

Restaurant-level Adjusted EBITDA

 

$

21,432

 

 

$

9,479

 

 

$

30,911

 

 

 

 

 

 

 

 

Six Months Ended

 

Pollo Tropical

 

Taco Cabana

 

Consolidated

June 28, 2020:

 

 

 

 

 

 

Net loss

 

 

 

 

 

$

(15,660

)

Benefit from income taxes

 

 

 

 

 

(4,748

)

Loss before taxes

 

$

(7,013

)

 

$

(13,395

)

 

$

(20,408

)

Add:

 

 

 

 

 

 

Non-general and administrative expense adjustments:

 

 

 

 

 

 

Depreciation and amortization

 

10,511

 

 

8,484

 

 

18,995

 

Impairment and other lease charges

 

5,628

 

 

890

 

 

6,518

 

Interest expense

 

1,108

 

 

1,090

 

 

2,198

 

Closed restaurant rent expense, net of sublease income

 

1,273

 

 

2,189

 

 

3,462

 

Other expense (income), net

 

751

 

 

941

 

 

1,692

 

Stock-based compensation expense in restaurant wages

 

38

 

 

67

 

 

105

 

Total non-general and administrative expense adjustments

 

19,309

 

 

13,661

 

 

32,970

 

General and administrative expense adjustments:

 

 

 

 

 

 

Stock-based compensation expense

 

833

 

 

902

 

 

1,735

 

Restructuring costs and retention bonuses

 

452

 

 

439

 

 

891

 

Digital and brand repositioning costs

 

192

 

 

158

 

 

350

 

Total general and administrative expense adjustments

 

1,477

 

 

1,499

 

 

2,976

 

Adjusted EBITDA

 

$

13,773

 

 

$

1,765

 

 

$

15,538

 

Restaurant-level adjustments:

 

 

 

 

 

 

Add: Pre-opening costs

 

 

 

69

 

 

69

 

Add: Other general and administrative expense(1)

 

12,549

 

 

11,147

 

 

23,696

 

Less: Franchise royalty revenue and fees

 

550

 

 

384

 

 

934

 

Restaurant-level Adjusted EBITDA

 

$

25,772

 

 

$

12,597

 

 

$

38,369

 

 

 

 

 

 

 

 

June 30, 2019:

 

 

 

 

 

 

Net loss

 

 

 

 

 

$

(41,151

)

Provision for income taxes

 

 

 

 

 

1,569

 

Income (loss) before taxes

 

$

12,874

 

 

$

(52,456

)

 

$

(39,582

)

Add:

 

 

 

 

 

 

Non-general and administrative expense adjustments:

 

 

 

 

 

 

Depreciation and amortization

 

10,589

 

 

8,766

 

 

19,355

 

Impairment and other lease charges

 

(327

)

 

1,740

 

 

1,413

 

Goodwill impairment

 

 

 

46,485

 

 

46,485

 

Interest expense

 

1,136

 

 

1,065

 

 

2,201

 

Closed restaurant rent expense, net of sublease income

 

2,183

 

 

576

 

 

2,759

 

Other expense (income), net

 

744

 

 

112

 

 

856

 

Stock-based compensation expense in restaurant wages

 

9

 

 

34

 

 

43

 

Total non-general and administrative expense adjustments

 

14,334

 

 

58,778

 

 

73,112

 

General and administrative expense adjustments:

 

 

 

 

 

 

Stock-based compensation expense

 

928

 

 

556

 

 

1,484

 

Restructuring costs and retention bonuses

 

827

 

 

137

 

 

964

 

Total general and administrative expense adjustments

 

1,755

 

 

693

 

 

2,448

 

Adjusted EBITDA

 

$

28,963

 

 

$

7,015

 

 

$

35,978

 

Restaurant-level adjustments:

 

 

 

 

 

 

Add: Pre-opening costs

 

239

 

 

547

 

 

786

 

Add: Other general and administrative expense(1)

 

14,292

 

 

11,827

 

 

26,119

 

Less: Franchise royalty revenue and fees

 

893

 

 

446

 

 

1,339

 

Restaurant-level Adjusted EBITDA

 

$

42,601

 

 

$

18,943

 

 

$

61,544

 

(1) Excludes general and administrative adjustments above.

 

FIESTA RESTAURANT GROUP, INC.
Supplemental Non-GAAP Information
The following table sets forth certain unaudited supplemental financial data for the periods indicated
(In thousands of dollars, except per share amounts):

Adjusted net income and related adjusted diluted earnings per share are non-GAAP financial measures. Adjusted net income is defined as net income (loss) before impairment and other lease charges, goodwill impairment, closed restaurant rent expense, net of sublease income, other expense (income), net, board and shareholder matter costs, restructuring costs and retention bonuses, certain legal settlements and related costs and other significant items that are related to strategic changes and/or are not related to the ongoing operation of our restaurants. Management believes that adjusted net income and related adjusted earnings per diluted share, when viewed with our results of operations calculated in accordance with GAAP (i) provide useful information about our operating performance and period-over-period growth, (ii) provide additional information that is useful for evaluating the operating performance of our business, and (iii) permit investors to gain an understanding of the factors and trends affecting our ongoing earnings, from which capital investments are made and debt is serviced. However, such measures are not measures of financial performance or liquidity under GAAP and, accordingly should not be considered as alternatives to net income or net income per share as indicators of operating performance or liquidity. Also, these measures may not be comparable to similarly titled captions of other companies.

 

 

(Unaudited)

 

 

Three Months Ended

 

 

June 28, 2020

 

June 30, 2019

 

 

Loss Before
Income
Taxes

 

Benefit
From
Income
Taxes (a)

 

Net
Loss

 

Diluted
EPS

 

Income
(Loss)
Before
Income
Taxes

 

Provision
For
Income
Taxes (a)

 

Net
Income
(Loss)

 

Diluted
EPS

Reported - GAAP

 

$

(10,086

)

 

$

(1,743

)

 

$

(8,343

)

 

$

(0.33

)

 

$

(42,817

)

 

$

623

 

 

$

(43,440

)

 

$

(1.62

)

Adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-general and administrative expense adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deferred tax asset valuation allowance (b)

 

 

 

(971

)

 

971

 

 

0.04

 

 

 

 

 

 

 

 

 

Impairment and other lease charges (c)

 

2,285

 

 

546

 

 

1,739

 

 

0.07

 

 

1,751

 

 

436

 

 

1,315

 

 

0.05

 

Goodwill impairment (d)

 

 

 

 

 

 

 

 

 

46,485

 

 

 

 

46,485

 

 

1.73

 

Closed restaurant rent expense, net of sublease income (e)

 

1,830

 

 

437

 

 

1,393

 

 

0.06

 

 

1,335

 

 

333

 

 

1,002

 

 

0.04

 

Other expense (income), net (f)

 

784

 

 

187

 

 

597

 

 

0.02

 

 

154

 

 

38

 

 

116

 

 

 

Total non-general and administrative expense

 

4,899

 

 

199

 

 

4,700

 

 

0.19

 

 

49,725

 

 

807

 

 

48,918

 

 

1.82

 

General and administrative expense adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Restructuring costs and retention bonuses (g)

 

891

 

 

213

 

 

678

 

 

0.03

 

 

349

 

 

87

 

 

262

 

 

0.01

 

Digital and brand repositioning costs (h)

 

131

 

 

31

 

 

100

 

 

 

 

 

 

 

 

 

 

 

Total general and administrative expense

 

1,022

 

 

244

 

 

778

 

 

0.03

 

 

349

 

 

87

 

 

262

 

 

0.01

 

Adjusted - Non-GAAP

 

$

(4,165

)

 

$

(1,300

)

 

$

(2,865

)

 

$

(0.11

)

 

$

7,257

 

 

$

1,517

 

 

$

5,740

 

 

$

0.21

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Unaudited)

 

 

Six Months Ended

 

 

June 28, 2020

 

June 30, 2019

 

 

Loss Before
Income
Taxes

 

Benefit
From
Income
Taxes (a)

 

Net
Loss

 

Diluted
EPS

 

Income
(Loss)
Before
Income
Taxes

 

Provision
For
Income
Taxes (a)

 

Net
Income
(Loss)

 

Diluted
EPS

Reported - GAAP

 

$

(20,408

)

 

$

(4,748

)

 

$

(15,660

)

 

$

(0.62

)

 

$

(39,582

)

 

$

1,569

 

 

$

(41,151

)

 

$

(1.53

)

Adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-general and administrative expense adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income tax due to tax law change (a)

 

 

 

1,603

 

 

(1,603

)

 

(0.06

)

 

 

 

 

 

 

 

 

Deferred tax asset valuation allowance (b)

 

 

 

(1,674

)

 

1,674

 

 

0.07

 

 

 

 

 

 

 

 

 

Impairment and other lease charges (c)

 

6,518

 

 

1,558

 

 

4,960

 

 

0.20

 

 

1,413

 

 

352

 

 

1,061

 

 

0.04

 

Goodwill impairment (d)

 

 

 

 

 

 

 

 

 

46,485

 

 

 

 

46,485

 

 

1.73

 

Closed restaurant rent expense, net of sublease income (e)

 

3,462

 

 

827

 

 

2,635

 

 

0.10

 

 

2,759

 

 

687

 

 

2,072

 

 

0.08

 

Other expense (income), net (f)

 

1,692

 

 

404

 

 

1,288

 

 

0.05

 

 

856

 

 

213

 

 

643

 

 

0.02

 

Total non-general and administrative expense

 

11,672

 

 

2,718

 

 

8,954

 

 

0.35

 

 

51,513

 

 

1,252

 

 

50,261

 

 

1.87

 

General and administrative expense adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Restructuring costs and retention bonuses (g)

 

891

 

 

213

 

 

678

 

 

0.03

 

 

964

 

 

240

 

 

724

 

 

0.03

 

Digital and brand repositioning costs (h)

 

350

 

 

84

 

 

266

 

 

0.01

 

 

 

 

 

 

 

 

 

Total general and administrative expense

 

1,241

 

 

297

 

 

944

 

 

0.04

 

 

964

 

 

240

 

 

724

 

 

0.03

 

Adjusted - Non-GAAP

 

$

(7,495

)

 

$

(1,733

)

 

$

(5,762

)

 

$

(0.23

)

 

$

12,895

 

 

$

3,061

 

 

$

9,834

 

 

$

0.37

 

(a)

 

The provision for (benefit from) income taxes related to the adjustments was calculated using the Company's combined federal statutory and estimated state rate of 23.9% and 24.9% for the periods ending June 28, 2020, and June 30, 2019, respectively. For fiscal years beginning January 1, 2018, our federal statutory tax rate is 21% as a result of the enactment of the Tax Cuts and Jobs Act (the "Act") in December 2017. For the six months ended June 28, 2020, we recorded a $1.8 million tax benefit related to prior year net operating losses as a result of a provision in the CARES Act that allows net operating losses from 2018–2020 to be carried back for five years.

(b)

 

We recorded an additional valuation allowance of $1.0 million and $1.7 million for the three and six months ended June 28, 2020, respectively, against deferred income tax assets where it was determined to be more likely than not that the deferred income tax assets will not be realized through the reversal of existing deferred tax liabilities.

(c)

 

Impairment and other lease charges for the three and six months ended June 28, 2020, consist of impairment charges of $1.6 million and $5.9 million, respectively, and other lease charges of $0.6 million. The impairment charges primarily relate to the write-down of assets held for sale to their fair value for the three and six months ended June 28, 2020 and two underperforming Taco Cabana restaurants and three underperforming Pollo Tropical restaurants that we continue to operate for the six months ended June 28, 2020. The other lease charges primarily relate to lease termination charges of $0.9 million for restaurant locations we decided not to develop, net of a gain from a lease termination of $(0.2) million.

 

 

Impairment and other lease charges for the three and six months ended June 30, 2019, primarily consist of impairment charges of $1.8 million and $2.2 million, respectively, and a lease charge recoveries benefit related to closed restaurant lease terminations of $(0.7) million for the six months ended June 30, 2019. The impairment charges primarily related to assets for three underperforming Taco Cabana restaurants that we continue to operate and equipment from previously impaired restaurants.

(d)

 

Goodwill impairment for the three and six months ended June 30, 2019 consists of a non-cash impairment charge to write down the value of goodwill for the Taco Cabana reporting unit.

(e)

 

Closed restaurant rent expense, net of sublease income for the three and six months ended June 28, 2020, primarily consists of closed restaurant lease costs of $3.0 million and $5.9 million, respectively, partially offset by sublease income of $(1.2) million and $(2.4) million, respectively. Closed restaurant rent expense, net of sublease income for the three and six months ended June 30, 2019, primarily consists of closed restaurant lease costs of $2.2 million and $4.4 million, respectively, partially offset by sublease income of $(0.9) million and $(1.6) million, respectively.

(f)

 

Other expense (income), net for the three and six months ended June 28, 2020, primarily consists of the write-off of site development costs of $0.6 million and costs for the removal, transfer, and storage of equipment from closed restaurants and other closure related costs of $0.2 million and $1.1 million, respectively. Other expense (income), net for the three and six months ended June 30, 2019, primarily consists of costs for the removal, transfer, and storage of equipment from closed restaurants of $0.2 million and $0.6 million, respectively.

(g)

 

Restructuring costs and retention bonuses for the three and six months ended June 28, 2020, include severance costs related to terminations in response to the COVID-19 pandemic. Restructuring costs and retention bonuses for the three and six months ended June 30, 2019, include severance costs related to eliminated positions.

(h)

 

Digital and brand repositioning costs for the three and six months ended June 28, 2020, include consulting costs related to repositioning the digital experience for our customers.

 

Investor Relations:
Raphael Gross
203-682-8253
investors@frgi.com

Source: Fiesta Restaurant Group, Inc.

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Fiesta Restaurant Group, Inc.
14800 Landmark Blvd.
Suite 500
Addison, TX 75254
(800) 819-FRGI

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