JACKSONVILLE, Fla., Aug. 21, 2018 (GLOBE NEWSWIRE) -- ARC Group, Inc. ARCK, the owner, operator and franchisor of the award-winning Dick's Wings & Grill® concept, announced financial results for the second quarter of 2018 ended June 30, 2018.
Second quarter 2018 financial highlights:
- Revenue increased 7% to $1.2 million for Q2 2018 from $1.1 million for Q2 2017.
- Net loss improved to $55,531, or $(0.01) per share, during Q2 2018 compared to $118,313, or $(0.02) per share, during Q2 2017.
- Cash flows from operating activities were $180,000 during the six months ended June 30, 2018.
Richard W. Akam, Chief Executive Officer of ARC Group, stated, "We are pleased to report that our revenues increased 7% to $1.2 million for the second quarter of 2018. We expect this revenue trend to continue for the remainder of the year as we continue to grow the Dick's Wings® brand through the execution of our organic growth strategy. We expect to open 2-3 new company-owned Dick's Wings restaurants during the remainder of 2018, which should provide a noticeable benefit to our top and bottom line."
"In addition to our organic growth strategy, we are actively pursuing a number of potential acquisitions that should help us to rapidly scale the business," stated Seenu G. Kasturi, Chief Financial Officer of ARC Group. "Specifically, we are targeting acquisitions that are accretive to earnings and/or that offer significant growth prospects. We believe these acquisitions will benefit from our strong marketing and operating experience, while leveraging our existing infrastructure."
Mr. Kasturi continued, "In June, we announced that we intend to acquire Tilted Kilt Pub and Eatery® franchise. Tilted Kilt Pub and Eatery has more than 40 locations in operation across the United States and Canada. The brand is well recognized and is a pace setter in the sports bar category. Additionally, we recently entered into a definitive agreement to acquire Fat Patty's, a local brand located in West Virginia and Kentucky, that is expected to close at the end of this month and will immediately improve our bottom line. We will be announcing additional information about this acquisition in the near future."
About ARC Group, Inc.
ARC Group, Inc., headquartered in Jacksonville, Florida, is the owner, operator and franchisor of the Dick's Wings & Grill concept. Now in its 23rd year of operation, Dick's Wings prides itself on its award-winning chicken wings, hog wings and duck wings spun in its signature sauces and seasonings. It also offers its own proprietary line of craft beers under the name "Dick's Craft Beers". Dick's Wings has 15 restaurants in Florida and five restaurants in Georgia. It also has two concession stands at TIAA Bank Field (formerly EverBank Field), home of the NFL's Jacksonville Jaguars, as well as a concession stand at Jacksonville Veterans Memorial Arena, home of the National Arena League's Jacksonville Sharks.
Dick's Wings is actively offering franchise opportunities in Florida, Georgia, Alabama, Louisiana, North Carolina and South Carolina. For more information about Dick's Wings locations, and for additional franchising information, please visit www.dickswingsandgrill.com.
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, 2017 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.
Contact:
David Waldman / Natalya Rudman
Crescendo Communications, LLC
Tel: 212-671-1020
Email: arck@crescendo-ir.com
(tables follow)
| ARC Group, Inc. | ||||||||||||||||||
| Condensed Consolidated Statements of Operations (Unaudited) | ||||||||||||||||||
| For the Three Months Ended | For the Six Months Ended | |||||||||||||||||
| June 30, 2018 | June 30, 2017 | June 30, 2018 | June 30, 2017 | |||||||||||||||
| Revenue: | ||||||||||||||||||
| Restaurant sales | $ | 894,069 | $ | 885,989 | $ | 1,878,844 | $ | 1,754,465 | ||||||||||
| Franchise and other revenue | 225,650 | 165,825 | 458,909 | 343,127 | ||||||||||||||
| Franchise and other revenue – related party | 49,110 | 40,040 | 77,738 | 83,058 | ||||||||||||||
| Total net revenue | 1,168,829 | 1,091,854 | 2,415,491 | 2,180,650 | ||||||||||||||
| Operating expenses: | ||||||||||||||||||
| Restaurant operating costs: | ||||||||||||||||||
| Cost of sales | 278,985 | 311,748 | 549,520 | 594,754 | ||||||||||||||
| Labor | 343,167 | 296,419 | 597,706 | 564,898 | ||||||||||||||
| Occupancy | 52,876 | 63,820 | 113,335 | 94,535 | ||||||||||||||
| Other operating expenses | 225,073 | 187,258 | 437,191 | 357,310 | ||||||||||||||
| Professional fees | 118,254 | 257,590 | 247,167 | 283,210 | ||||||||||||||
| Employee compensation expense | 120,207 | 74,270 | 251,412 | 159,593 | ||||||||||||||
| General and administrative expenses | 161,147 | 16,237 | 301,732 | 31,446 | ||||||||||||||
| Total operating expenses | 1,299,709 | 1,207,342 | 2,498,063 | 2,085,746 | ||||||||||||||
| Income / (loss) from operations | (130,880 | ) | (115,488 | ) | (82,572 | ) | 94,904 | |||||||||||
| Other income / (expense): | ||||||||||||||||||
| Interest expense | (5,479 | ) | (8,299 | ) | (10,873 | ) | (16,224 | ) | ||||||||||
| Other income | 80,828 | 5,474 | 85,528 | 9,084 | ||||||||||||||
| Total other income / (expense) | 75,349 | (2,825 | ) | 74,655 | (7,140 | ) | ||||||||||||
| Net income / (loss) | $ | (55,531 | ) | $ | (118,313 | ) | $ | (7,917 | ) | $ | 87,764 | |||||||
| Net income / (loss) per share – basic and fully diluted | $ | (0.01 | ) | $ | (0.02 | ) | $ | (0.00 | ) | $ | 0.01 | |||||||
| Weighted average number of shares outstanding – basic and fully diluted | 6,901,687 | 6,734,534 | 6,933,500 | 6,691,239 | ||||||||||||||
| ARC Group, Inc. | ||||||||
| Condensed Consolidated Balance Sheets | ||||||||
| June 30, | December 31, | |||||||
| 2018 | 2017 | |||||||
| (Unaudited) | ||||||||
| Assets | ||||||||
| Cash and cash equivalents | $ | 32,992 | $ | 145,346 | ||||
| Accounts receivable, net | 44,363 | 166,987 | ||||||
| Accounts receivable, net – related party | 733 | 1,505 | ||||||
| Ad funds receivable, net | 10,707 | 36,837 | ||||||
| Ad funds receivable, net – related party | 1,765 | 2,280 | ||||||
| Inventory | 52,281 | 45,417 | ||||||
| Notes receivable, net | 15,853 | 28,522 | ||||||
| Deposits | 17,461 | 21,189 | ||||||
| Other current assets | 7,234 | 5,923 | ||||||
| Total current assets | 183,389 | 454,006 | ||||||
| Notes receivable, net of current portion | 3,829 | 5,106 | ||||||
| Property and equipment, net | 343,859 | 99,114 | ||||||
| Total assets | $ | 531,077 | $ | 558,226 | ||||
| Liabilities and stockholders' deficit | ||||||||
| Accounts payable and accrued expenses | $ | 625,194 | $ | 467,264 | ||||
| Accounts payable and accrued expenses – related party | 75,057 | 94,150 | ||||||
| Accrued interest | 15,226 | 13,472 | ||||||
| Settlement agreements payable | 270,587 | 264,997 | ||||||
| Accrued legal contingency | 159,817 | 155,935 | ||||||
| Notes payable – related party | 2,177 | 30,503 | ||||||
| Contingent consideration | 56,356 | 199,682 | ||||||
| Deferred franchise fees | 27,956 | - | ||||||
| Other current liabilities | 11,643 | 9,147 | ||||||
| Total current liabilities | 1,244,013 | 1,235,150 | ||||||
| Deferred franchise fees, net of current portion | 130,508 | - | ||||||
| Total liabilities | 1,374,521 | 1,235,150 | ||||||
| Stockholders' equity deficit: | ||||||||
| Class A common stock – $0.01 par value: 100,000,000 shares authorized, 6,524,427 and 6,950,869 shares issued and outstanding at June 30, 2018 and December 31, 2017, respectively | 65,244 | 69,509 | ||||||
| Series A convertible preferred stock – $0.01 par value: 1,000,000 shares authorized, 449,581 and -0- outstanding at June 30, 2018 and December 31, 2017, respectively | 4,496 | - | ||||||
| Additional paid-in capital | 4,032,951 | 3,995,306 | ||||||
| Stock subscriptions payable | 26,852 | 26,853 | ||||||
| Accumulated deficit | (4,972,987 | ) | (4,768,592 | ) | ||||
| Total stockholders' deficit | (843,444 | ) | (676,924 | ) | ||||
| Total liabilities and stockholders' deficit | $ | 531,077 | $ | 558,226 | ||||
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