In This Article:
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Cash: Ended the year with $10.3 million; currently $10.5 million to $11 million.
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Debt: $5.2 million, with $4.4 million maturing on June 1.
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Goodwill Impairment: Additional $4 million impairment, following a $10 million impairment last year.
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Loss on Closure: $876,000 loss from the closure of El Rio Grande.
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Food Court Lease Termination: $5.5 million payment to vacate Tampa Food Court.
Release Date: December 17, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Ark Restaurants Corp (NASDAQ:ARKR) ended the year with a stable balance sheet, holding $10.3 million in cash and $5.2 million in debt.
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The company successfully negotiated a favorable deal to vacate their Tampa Food Court, receiving $5.5 million, which will add approximately $3.5 million to $4 million to their cash reserves.
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Labor costs have stabilized, allowing Ark Restaurants Corp (NASDAQ:ARKR) to find good employees at competitive price points.
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The company is actively exploring new concepts, such as the Lucky Pig, which has potential for expansion.
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Ark Restaurants Corp (NASDAQ:ARKR) is focusing on improving existing businesses through enhanced social media and marketing efforts to drive more customer traffic.
Negative Points
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Ark Restaurants Corp (NASDAQ:ARKR) faces a challenging revenue environment, particularly in Florida and Washington DC, with reduced sales and persistent expenses.
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The company incurred a significant goodwill impairment of $4 million, following a $10 million impairment the previous year.
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The closure of El Rio Grande resulted in a loss of $876,000 due to stalled lease negotiations.
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Rising costs, such as insurance premiums and king crab prices, continue to pressure margins, limiting the company's ability to raise prices.
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The Meadowlands casino project remains uncertain, with legislative delays impacting potential development opportunities.
Q & A Highlights
Q: Can you provide an update on the potential casino developments in New York and how they might impact the Meadowlands project? A: Michael Weinstein, Chairman & CEO, explained that there are three downtown licenses available in New York, with several bidders including SL Green and Hudson Yards. The decision on these licenses will be a catalyst for New Jersey to move forward with its own casino plans. Weinstein emphasized that the Meadowlands location is strategically advantageous, potentially attracting both New Jersey and Manhattan patrons.
Q: What is the total amount of non-cash write-downs taken in the last two years, and are these related to the company's market cap? A: Michael Weinstein confirmed that the write-downs, totaling $16.5 million, are non-cash and largely related to the company's stock price. Anthony J. Sirica, CFO, specified that $14 million was for goodwill and $2.5 million for Sequoia assets.