Good Times Restaurants Inc. (NASDAQ:GTIM) Q1 2019 Earnings Conference Call Transcript
Feb 07, 2019 • 05:00 pm ET
Good afternoon, ladies and gentlemen, and welcome to the Good Times Restaurant Inc. Fiscal 2019 First Quarter Earnings Call
By now, everyone should have access to the Company's first quarter earnings release. If not, it can be found at www.goodtimesburgers.com in the Investors section.
As a reminder, a part of today's discussion will include forward-looking statements within the meaning of the federal securities laws. These forward-looking statements are not guarantees of future performance and therefore, you should not put undue reliance on them. These statements are also subject to numerous risks and uncertainties that could cause actual results to differ materially from what we expect and therefore, investors should not place undue reliance on them. And the Company undertakes no obligation to update these statements to reflect the events or circumstances that might arise after this call. The Company refers you to their recent SEC filings for a more detailed discussion of the risks that could impact the future operating results and financial conditions.
Lastly, during today's call, the Company will discuss non-GAAP measures, which they believe can be useful in evaluating our performance. The presentation of this additional information should not be considered in isolation or as a substitute for the results prepared in accordance with GAAP and reconciliation to comparable GAAP measures available in our earnings release. Please note, this event is being recorded.
I would now like to turn the conference over to Boyd Hoback. Please go ahead, sir.
Boyd E. Hoback
Thank you, Cole, and thanks, everyone, for joining us on the call today. With me today is Ryan Zink, our Chief Financial Officer. Well, let me begin with a high level overview of our quarterly results and progress on various initiatives. And then Ryan will get into more detail on our financial results.
For the first quarter, revenue grew 11%, including a 0.2% increase in comparable restaurant sales of Bad Daddy's, even though we lost about 10 store days to closures in North Carolina due to the storm, and a 5.2% decrease in comparable restaurant sales at Good Times. Our Bad Daddy's sales showed some further acceleration at the end of the quarter and that acceleration has continued so far into our current quarter.
Good Times sales were impacted by fairly dramatic year-over-year weather comparisons, with the prior year having above-average temperatures and below-average precipitation, with this year being the opposite. We estimate that most of the comp sales decline is weather related as we were comping over a 5.9% increase from last year, and that unusually warm weather trend last year continued through the middle of the second quarter and things began to normalize after that. While weather is the major factor, we're also impacted by the aggressive competitive discounting in the quick service restaurant space. While we're not a low-price leader, we're a major discounter. However, we believe we need to increase the frequency of book value and premium product messaging for Good Times.
As such, beginning later this month, we're shifting to a heavy radio and