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Good Times Restaurants Reports Q4 and Fiscal Year End Results

DENVER, Dec 07, 2017 (BUSINESS WIRE) --

--Total Revenues for Fiscal 2017 Increased 23% to $79 Million

--Conference Call Thursday, December 7, 2017, at 3:00 p.m. MT/5:00 p.m. ET

Good Times Restaurants Inc. (NASDAQ: GTIM), operator of Good Times Burgers & Frozen Custard, a regional quick service restaurant chain focused on fresh, high quality, all natural products, and Bad Daddy's Burger Bar, a full service, upscale concept, today announced its preliminary unaudited financial results for the fourth fiscal quarter ended September 26, 2017.

Key highlights of the Company's financial results vs prior year include:

-- Same store sales for company-owned Good Times restaurants increased 3.9% for the quarter and increased 2.1% for the year on top of last year's increase of 0.3% for the year

-- Same store sales for company-owned Bad Daddy's restaurants increased 1.4% for the quarter and 1.6% for the year on top of last year's increase of 1.9% for the quarter and 3.3% for the year

-- Total revenues increased 31% to $22,584,000 for the quarter and increased 23% to $79,080,000 for the year, which reflects the addition of one new Good Times restaurant and six Bad Daddy's restaurants during the year

-- Subsequent to the year end two additional Bad Daddy's opened during the first two weeks of October

-- Income from Operations declined by $1,122,000 to a loss of $1,422,000 for the year, which includes the impact of $2,588,000 of new store preopening costs incurred in fiscal 2017.

-- Restaurant Level Operating Profit (a non-GAAP measure) for Good Times restaurants improved to $1,333,000 for the quarter versus $1,313,000 in the same quarter last year*

-- Restaurant Level Operating Profit (a non-GAAP measure) for Bad Daddy's restaurants improved 28% to $2,081,000 in the fourth quarter from $1,631,000 in the fourth quarter last year*

-- Total Restaurant Level Operating Profit (a non-GAAP measure) increased 16% to $3,414,000 for the quarter and increased 15% to $12,378,000 for the year*

-- Adjusted EBITDA (a non-GAAP measure) for the quarter increased 24% to $1,305,000 from $1,051,000 and increased 12% to $3,777,000 from $3,368,000 for the fiscal year*

-- The Company ended the quarter with $4.3 million in cash and $5.3 million of long term debt

Boyd Hoback, President & CEO, said, "We are pleased with our results that were slightly ahead of our revised guidance for the fourth quarter, particularly given the intense discounting and value pricing environment in both segments and absorbing the spike in commodity costs that began in our third quarter. For the first nine weeks of our first quarter of fiscal 2018 same store sales are +4.3% for Good Times and +1.7% at Bad Daddy's. Our class of 2017 new Bad Daddy's are averaging above our systemwide sales average and we are pleased with their performance as they reach stabilized sales trends after their honeymoon sales periods."

Hoback added, "We opened two Bad Daddy's on October 2nd and October 9th in North Carolina that had been planned for the last two weeks of fiscal 2017 and expect to open an additional seven restaurants during the balance of fiscal 2018. We expect to open our next Bad Daddy's in the Atlanta, Georgia market in very early January 2018 with additional units following in North Carolina, South Carolina, and Tennessee. We have eight Bad Daddy's leases signed and expect to sign an additional four leases by the end of the calendar year for our fiscal 2018 and initial 2019 development."

Fiscal 2018 Outlook:

The Company has confirmed and updated its guidance for fiscal 2018:

-- Total revenues of approximately $100 million to $102 million with a year-end revenue run rate of approximately $109 million to $111 million

-- Total revenue estimates assume same store sales of approximately +3% to +3.5% for Good Times consistently throughout the year and +1% to +2% for Bad Daddy's.

-- General and administrative expenses of approximately $7.8 million to $8.0 million, including approximately $700,000 of non-cash equity compensation expense

-- The opening of 9 new Bad Daddy's restaurants (including 2 joint venture units)

-- Net loss of approximately $1.4 million, including pre-opening expenses of approximately $2.5 million

-- Total Adjusted EBITDA* of approximately $5.0 million to $5.5 million

-- Capital expenditures (net of tenant improvement allowances) of approximately $9.5 million including approximately $1.2 million related to fiscal 2019 development

*For a reconciliation of restaurant level operating profit and Adjusted EBITDA to the most directly comparable financial measures presented in accordance with GAAP and a discussion of why the Company considers them useful, see the financial information schedules accompanying this release.

Conference Call: Management will host a conference call to discuss its fourth quarter 2017 financial results on Thursday, December 7, 2017 at 3:00 p.m. MT/5:00 p.m. ET. Hosting the call will be Boyd Hoback, President and Chief Executive Officer, and Ryan Zink, Chief Financial Officer.

The conference call can be accessed live over the phone by dialing (888) 339-0806 and requesting the Good Times Restaurants (GTIM) call. The conference call will also be webcast live from the Company's corporate website www.goodtimesburgers.com under the Investor section. An archive of the webcast will be available at the same location on the corporate website shortly after the call has concluded.

About Good Times Restaurants Inc.: Good Times Restaurants Inc. (GTIM) operates Good Times Burgers & Frozen Custard, a regional chain of quick service restaurants located primarily in Colorado, through its wholly-owned subsidiary, Good Times Drive Thru Inc. Good Times provides a menu of high quality all natural hamburgers, 100% all natural chicken tenderloins, fresh frozen custard, natural cut fries, fresh lemonades and other unique offerings. Good Times currently operates and franchises a total of 38 restaurants.

GTIM also owns, operates, franchises and licenses 26 Bad Daddy's Burger Bar restaurants through its wholly-owned subsidiaries. Bad Daddy's Burger Bar is a full service, upscale "small box" restaurant concept featuring a chef driven menu of gourmet signature burgers, chopped salads, appetizers and sandwiches with a full bar and a focus on a selection of craft microbrew beers in a high-energy atmosphere that appeals to a broad consumer base.

Good Times Forward-Looking Statements: This press release contains forward-looking statements within the meaning of federal securities laws. The words "intend," "may," "believe," "will," "should," "anticipate," "expect," "seek" and similar expressions are intended to identify forward-looking statements. These statements involve known and unknown risks, which may cause the Company's actual results to differ materially from results expressed or implied by the forward-looking statements. These risks include such factors as the uncertain nature of current restaurant development plans and the ability to implement those plans and integrate new restaurants, delays in developing and opening new restaurants because of weather, local permitting or other reasons, increased competition, cost increases or shortages in raw food products, and other matters discussed under the "Risk Factors" section of Good Times' Annual Report on Form 10-K for the fiscal year ended September 27, 2016 filed with the SEC. Although Good Times may from time to time voluntarily update its forward-looking statements, it disclaims any commitment to do so except as required by securities laws.

 
                                                                                                                                                                                                        Good Times Restaurants Inc.
                                                                                                                                                                                                    Unaudited Supplemental Information
                                                                                                                                                                                                 (In thousands, except per share amounts)
 
                                                                                                                             Fiscal Quarter Ended                                                                                                                               Fiscal Year Ended
                                                                                                       --------------------------------------------------------------------------------------------------------------------------------------------                                          ----------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                           Sept. 26,                                            Sept. 27,                                                                                   Sept. 26,                                             Sept. 27,
Statement of Operations                                                                                                      2017                                                                                       2016                                                                                        2017                                                                                        2016
                                                                                                       -------------------------------------------------                                          -------------------------------------------------                                          --------------------------------------------------                                          --------------------------------------------------
Net revenues:
    Restaurant sales                                                                                                      $ 22,414                                                                                   $ 17,040                                                                                   $  78,395                                                                                   $  63,716
    Franchise revenues                                                                                      170                                                  177                                                   685                                                   723  
                                                                                                       -------------------- ------ --------------------                                           -------------------- ------ --------------------                                           -------------------- ------- --------------------                                           -------------------- ------- --------------------
        Total net revenues                                                                                                  22,584                                                                                     17,217                                                                                      79,080                                                                                      64,439
                                                                                                                                                                                                                                                                                                                                                                                                                       
Restaurant Operating Costs:
    Food and packaging costs                                                                                                 7,309                                                                                      5,383                                                                                      24,900                                                                                      20,236
    Payroll and other employee benefit costs                                                                                 8,058                                                                                      5,868                                                                                      28,274                                                                                      22,098
    Restaurant occupancy costs                                                                                               1,552                                                                                      1,290                                                                                       5,759                                                                                       4,893
    Other restaurant operating costs                                                                                         2,081                                                                                      1,555                                                                                       7,084                                                                                       5,684
    New store preopening costs                                                                                                 851                                                                                        267                                                                                       2,588                                                                                       1,695
    Depreciation and amortization                                                                           811                                                  630                                                 2,897                                                 2,222  
                                                                                                       -------------------- ------ --------------------                                           -------------------- ------ --------------------                                           -------------------- ------- --------------------                                           -------------------- ------- --------------------
        Total restaurant operating costs                                                                                    20,662                                                                                     14,993                                                                                      71,502                                                                                      56,828
                                                                                                                                                                                                                                                                                                                                                                                                                       
General and administrative costs                                                                                             1,780                                                                                      1,587                                                                                       7,002                                                                                       6,288
Advertising costs                                                                                                              337                                                                                        403                                                                                       1,694                                                                                       1,540
Franchise costs                                                                                                                 28                                                                                         26                                                                                         108                                                                                         108
Asset impairment costs                                                                                                         219                                                                                          0                                                                                         219                                                                                           0
(Gain) on disposal of restaurants and equipment                                                              (6 )                                                                    (6 )                                                                    (23 )                                                                    (25 )
                                                                                                       -------------------- ------ --------------------                                           -------------------- ------ --------------------                                           -------------------- ------- --------------------                                           -------------------- ------- --------------------
        Income (loss) from operations                                                                                         (436 )                                                                                      214                                                                                      (1,422 )                                                                                      (300 )
                                                                                                                                                                                                                                                                                                                                                                                                                       
Other income (expense):
    Interest income (expense), net                                                                                             (77 )                                                                                      (17 )                                                                                      (182 )                                                                                      (107 )
    Debt extinguishment costs                                                                                                    0                                                                                        (57 )                                                                                         0                                                                                         (57 )
    Other expense                                                                                             0                                                    0                                                    (1 )                                                                     (1 )
                                                                                                       -------------------- ------ --------------------                                           -------------------- ------ --------------------                                           -------------------- ------- --------------------                                           -------------------- ------- --------------------
        Total other income (expenses), net                                                                  (77 )                                                                   (74 )                                                                   (183 )                                                                   (165 )
                                                                                                       -------------------- ------ --------------------                                           -------------------- ------ --------------------                                           -------------------- ------- --------------------                                           -------------------- ------- --------------------
Net income (loss)                                                                                                            ($513 )                                                                                 $    140                                                                                     ($1,605 )                                                                                     ($465 )
Income attributable to non-controlling interest                                                            (151 )                                                                  (211 )                                                                   (650 )                                                                   (856 )
                                                                                                       -------------------- ------ --------------------                                           -------------------- ------ --------------------                                           -------------------- ------- --------------------                                           -------------------- ------- --------------------
Net loss attributable to Good Times Restaurants Inc.                                                       (664 )                                                                  ($71 )                                                                ($2,255 )                                                                ($1,321 )
                                                                                                       ==================== ====== ====================                                           ==================== ====== ====================                                           ==================== ======= ====================                                           ==================== ======= ====================
                                                                                                                                                                                                                                                                                                                                                                                                                       
Basic and diluted loss per share                                                                                            ($0.05 )                                                                                   ($0.01 )                                                                                    ($0.18 )                                                                                    ($0.11 )
                                                                                                                                                                                                                                                                                                                                                                                                                       
Basic and diluted weighted average common shares outstanding                                                                12,393                                                                                     12,283                                                                                      12,321                                                                                      12,269
                                                                                                                                                                                                                                                                                                                                                                                                                       
                                                                                                                                                                                                                                                                                                                                                                                                                       
                                                                              Good Times Restaurants Inc.
                                                                          Unaudited Supplemental Information
                                                                                    (In thousands)
 
                                                                   Sept. 26,              Sept. 27,
Balance Sheet Data                                                                                         2017                                                         2016
                                                                                                       ------------                                          --------------------------
Cash & cash equivalents                                                                                   $  4,337                                              $                6,330
Current assets                                                                                               6,066                                                               7,793
Property and Equipment, net                                                                                 29,691                                                              19,692
Other assets                                                                                                19,396                                                              19,392
Total assets                                                                                              $ 55,153                                              $               46,877
                                                                                                                                                                   
Current liabilities, including capital lease obligations and                                              $  6,916                                              $                5,122
long-term
debt due within one year
Long-term debt due after one year                                                                            5,339                                                                  19
Other liabilities                                                                                            5,614                                                               3,938
Total liabilities                                                                                         $ 17,869                                              $                9,079
Stockholders' equity                                                           $ 37,284                                              $               37,798
                                                                                                                                                                   
Supplemental Information:
 
                                                                                        Good Times Burgers & Frozen Custard                                                                                                    Bad Daddy's Burger Bar
                                                                              -----------------------------------------------------------------------------------------------------------------------------------                                          -------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                         Fiscal Quarter Ended                               Fiscal Year Ended                                                                    Fiscal Quarter Ended                                     Fiscal Year Ended
                                                                               Sept. 26,    Sept. 27,                                             Sept. 26,     Sept. 27,                                              Sept. 26,    Sept. 27,                                             Sept. 26,            Sept. 27,
                                                                                 2017                            2016                                                  2017                             2016                                                   2017                            2016                                                  2017                                    2016
                                                                              -----------                     -----------                                          ------------                     -------------                                          ------------                     -----------                                          ------------                     --------------------------
Restaurant Sales                                                                 $ 8,378                         $ 7,500                                              $ 30,689                         $  28,861                                              $ 14,036                         $ 9,540                                              $ 47,706                         $               34,855
Average weekly sales per restaurant                                                 23.0                            21.4                                                  21.4                              20.6                                                  50.6                            48.0                                                  49.3                                           49.0
                                                                                                                                                                                                                                                                                                                                                                                        
Restaurant operating weeks                                                           364                           351.0                                                1432.3                           1,404.0                                                 277.3                           198.7                                                 968.1                                          710.7
Restaurants open during period                                                         0                               0                                                     1                                 0                                                     1                               1                                                     6                                              6
Restaurants open at period end                                                        28                              27                                                    28                                27                                                    22                              16                                                    22                                             16
                                                                                                                                                                                                                                                                                                                                                                                        

Reconciliation of Non-GAAP Measurements to US GAAP Results

                                                                                                                                                                                                                                     Reconciliation of Non-GAAP Restaurant-Level Operating Profit to
                                                                                                                                                                                                                                     Income (Loss) from Operations
                                                                                                                                                                                                                                     (In thousands, except percentage data)
 
                                                                                                                 Good Times Burgers & Frozen Custard                                                                                                     Bad Daddy's Burger Bar                                                                                               Good Times Restaurants Inc.
                                                                                                    -----------------------------------------------------------------------------------------------------------------------------------------                                          --------------------------------------------------------------------------------------------------------------------------------------------                                          -----------------------------------------------------------------------------------------------------------------------
                                                                                                                                                              Fiscal Quarter Ended                                                                                                                                                                 Fiscal Quarter Ended                                                                                                                                                       Fiscal Quarter Ended
                                                                                                                             Sept. 26,                                                   Sept. 27,                                                                                            Sept. 26,                                                    Sept. 27,                                                                                       Sept. 26,                                          Sept. 27,
                                                                                                                               2017                                                                           2016                                                                                                 2017                                                                            2016                                                                                            2017                                                                  2016
                                                                                                    -----------------------------------------------------                          -----------------------------------------------------                                               -------------------------------------------------------                          ------------------------------------------------------                                               ----------------------------------------------                        ----------------------------------------------
Restaurant Sales                                                                                                       $ 8,378   100.0 %                                           $ 7,500   100.0 %                                                                $ 14,036   100.0 %                                            $ 9,540   100.0 %                                                                 $ 22,414                                                              $ 17,040
Restaurant Operating Costs (exclusive of depreciation and
amortization shown separately below):
    Food and packaging costs                                                                                             2,802                       33.4 %                                             2,430                       32.4 %                                                                   4,507                       32.1 %                                              2,953                       31.0 %                                                                    7,309                                                                 5,383
                                                                                                                         2,843                       33.9 %                                             2,424                       32.3 %                                                                   5,215                       37.2 %                                              3,444                       36.1 %                                                                    8,058                                                                 5,868
    Payroll and other employee benefit costs
    Restaurant occupancy costs                                                                                             697                        8.3 %                                               686                        9.1 %                                                                     855                        6.1 %                                                604                        6.3 %                                                                    1,552                                                                 1,290
    Other restaurant operating costs                                                                    703                        8.4 %                            647                        8.6 %                                                1,378                        9.8 %                             908                        9.5 %                                                 2,081                           1,555  
                                                                                                    -------------------- -----                      ----- ---                      -------------------- -----                      ----- ---                                           -------------------- ------                      ----- ----                      -------------------- -----                      ----- ----                                           -------------------- ------ --------------------                      -------------------- ------ --------------------
Restaurant-level operating profit                                                                                        1,333                       15.9 %                                             1,313                       17.5 %                                                                   2,081                       14.8 %                                              1,631                       17.1 %                                                                    3,414                                                                 2,944
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
Franchise royalty income and expense, net                                                                                                                                                                                                                                                                                                                                                                                                                                                            170                                                                   177
Deduct - Other operating:
    Depreciation and amortization                                                                                                                                                                                                                                                                                                                                                                                                                                                                    811                                                                   630
    General and administrative                                                                                                                                                                                                                                                                                                                                                                                                                                                                     1,780                                                                 1,587
    Advertising costs                                                                                                                                                                                                                                                                                                                                                                                                                                                                                337                                                                   403
    Franchise costs                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   28                                                                    26
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      (6 )                                                                  (6 )
    (Gain) on disposal of restaurants and equipment
    Asset impairment costs                                                                                                                                                                                                                                                                                                                                                                                                                                                        219                               0  
                                                                                                                                                                                                                                                                                                                                                                                                                                                                             -------------------- ------ --------------------                      -------------------- ------ --------------------
    Preopening costs                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 851                                                                   267
        Total other operating                                                                                                                                                                                                                                                                                                                                                                                                                                                   4,020                           2,907  
                                                                                                                                                                                                                                                                                                                                                                                                                                                                             -------------------- ------ --------------------                      -------------------- ------ --------------------
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
Income (loss) from Operations                                                                                                                                                                                                                                                                                                                                                                                                                                                   ($436 )                                                            $    214  
                                                                                                                                                                                                                                                                                                                                                                                                                                                                             ==================== ====== ====================                      ==================== ====== ====================
 
                                                                                                                                                                                                                                     Certain percentage amounts in the table above do not total due
                                                                                                                                                                                                                                     to rounding as well as the fact that restaurant operating costs
                                                                                                                                                                                                                                     are expressed as a percentage of restaurant revenues, as opposed
                                                                                                                                                                                                                                     to total revenues.
 

Reconciliation of Non-GAAP Measurements to US GAAP Results

                                                                                                                                                                                                                                     Reconciliation of Non-GAAP Restaurant-Level Operating Profit to Loss
                                                                                                                                                                                                                                     from Operations
                                                                                                                                                                                                                                     (In thousands, except percentage data)
 
                                                                                                                  Good Times Burgers & Frozen Custard                                                                                                     Bad Daddy's Burger Bar                                                                                                 Good Times Restaurants Inc.
                                                                                                    ------------------------------------------------------------------------------------------------------------------------------------------                                          ---------------------------------------------------------------------------------------------------------------------------------------------                                          ------------------------------------------------------------------------------------------------------------------------
                                                                                                                                                                 Fiscal Year Ended                                                                                                                                                                    Fiscal Year Ended                                                                                                                                                            Fiscal Year Ended
                                                                                                                             Sept. 26,                                                   Sept. 27,                                                                                             Sept. 26,                                                     Sept. 27,                                                                                        Sept. 26,                                          Sept. 27,
                                                                                                                               2017                                                                           2016                                                                                                  2017                                                                             2016                                                                                             2017                                                                  2016
                                                                                                    ----------------------------------------------------------                     -----------------------------------------------------------                                          ------------------------------------------------------------                     ------------------------------------------------------------                                          --------------------------------------------------                     -------------------------------------------------
Restaurant Sales                                                                                                       $ 30,689    100 %                                           $ 28,861   100.0 %                                                                $ 47,706   100.0 %                                            $ 34,855   100.0 %                                                                 $  78,395                                                              $ 63,716
Restaurant Operating Costs (exclusive of depreciation and
amortization shown separately below):
    Food and packaging costs                                                                                              9,994                      32.6 %                                              9,346                       32.4 %                                                                  14,906                       31.2 %                                              10,890                       31.2 %                                                                    24,900                                                                20,236
                                                                                                                         10,548                      34.4 %                                              9,450                       32.7 %                                                                  17,726                       37.2 %                                              12,648                       36.3 %                                                                    28,274                                                                22,098
    Payroll and other employee benefit costs
    Restaurant occupancy costs                                                                                            2,772                       9.0 %                                              2,711                        9.4 %                                                                   2,987                        6.3 %                                               2,182                        6.3 %                                                                     5,759                                                                 4,893
    Other restaurant operating costs                                                                   2,536                       8.3 %                           2,381                        8.2 %                                                4,548                        9.5 %                            3,303                        9.5 %                                                  7,084                           5,684  
                                                                                                    -------------------- ------                      ---- ---                      -------------------- ------                      ----- ---                                           -------------------- ------                      ----- ----                      -------------------- ------                      ----- ----                                           -------------------- ------- --------------------                      -------------------- ------ --------------------
Restaurant-level operating profit                                                                                         4,839                      15.8 %                                              4,973                       17.2 %                                                                   7,539                       15.8 %                                               5,832                       16.7 %                                                                    12,378                                                                10,805
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
Franchise royalty income and expense, net                                                                                                                                                                                                                                                                                                                                                                                                                                                               685                                                                   723
Deduct - Other operating:
    Depreciation and amortization                                                                                                                                                                                                                                                                                                                                                                                                                                                                     2,897                                                                 2,222
    General and administrative                                                                                                                                                                                                                                                                                                                                                                                                                                                                        7,002                                                                 6,288
    Advertising costs                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  1694                                                                 1,540
    Franchise costs                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     108                                                                   108
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        (23 )                                                                 (25 )
    (Gain) on disposal of restaurants and equipment
    Asset impairment costs                                                                                                                                                                                                                                                                                                                                                                                                                                                                              219                                                                     0
    Preopening costs                                                                                                                                                                                                                                                                                                                                                                                                                                                               2,588                           1,695  
                                                                                                                                                                                                                                                                                                                                                                                                                                                                               -------------------- ------- --------------------                      --------------

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