Overview

Flanigan’s Enterprises, Inc. is a Florida-based company that operates and franchises restaurants, package liquor stores, and combination restaurant/package liquor stores. As of December 28, 2024, the company operates 32 units and franchises an additional 5 units.

Financial Performance

• Total revenue for the 13 weeks ended December 28, 2024 increased 11.35% to $50.26 million, primarily due to increased package liquor store and restaurant sales, higher menu prices, and the opening of a new corporate-owned restaurant.
• Restaurant food sales increased 10.5% to $29.13 million, with comparable weekly sales up 4.58% for company-owned restaurants and 4.79% for affiliated limited partnership restaurants.
• Restaurant bar sales increased 6.7% to $7.96 million, with comparable weekly sales up 1.74% for company-owned restaurants and 0.29% for affiliated limited partnership restaurants.
• Package store sales increased 17.3% to $12.44 million, with same-store sales up 17.28%.
• Costs and expenses increased 11.4% to $49.40 million, primarily due to higher payroll, food costs, and expenses from the new restaurant opening.
• Gross profit margins decreased slightly for both restaurant food/bar sales (64.87% vs 65.02%) and package store sales (23.76% vs 25.67%).
• Net income increased 6.4% to $632,000, but net income attributable to Flanigan’s Enterprises stockholders decreased 49.5% to $55,000 due to higher expenses and more income attributable to non-controlling interests.

Liquidity and Capital Resources

• The company had $27.32 million in cash and cash equivalents as of December 28, 2024, an increase of $5.92 million from September 28, 2024.
• Inflation is having a material impact on operating costs, including food, beverage, fuel, and labor.
• The company believes its current cash and positive cash flow will be sufficient to fund operations and planned capital expenditures for at least the next 12 months.
• Capital expenditures during the quarter were $745,000, primarily for renovations to one company-owned package liquor store.
• The company had $21.59 million in long-term debt as of December 28, 2024 and is in compliance with all loan covenants.

Outlook

• The company expects restaurant food sales, restaurant bar sales, and package store sales to increase for the remainder of fiscal year 2025 due to recent menu price increases.
• Costs and expenses are also expected to continue increasing, putting pressure on profit margins.
• The company has entered into a purchase agreement to fix the cost and ensure supply of baby back ribs for calendar year 2025.
• Overall, the company believes its current cash position and positive cash flow will be sufficient to fund operations and planned capital expenditures for the next 12 months, despite the challenges posed by inflation.