American Restaurant Concepts, Inc. Announces 2013 Financial Results
LAFAYETTE, La., April 1, 2014 /PRNewswire/ -- American Restaurant Concepts, Inc. (OTCBB: ANPZ), operator and franchisor of the award-winning Dick's Wings & Grill® restaurants, today announced strong financial results for its 2013 fiscal year. The Company achieved an increase in revenue for the third consecutive year while virtually eliminating debt owed to unrelated parties.
The Company achieved the following financial results for its full 2013 fiscal year compared to its full 2012 fiscal year:
- Revenue increased 9% to $489,816 from $450,946.
- Royalty revenue increased 23% to $435,622 compared to $355,012.
- Average annual royalty revenue per active restaurant increased $5,038 to $27,226 from $22,188.
- Debt from unrelated parties decreased almost 97% to $11,000 from $340,664.
- Net cash provided by financing activities increased $353,369 to $476,308 from $122,939.
"We ended 2013 with another great quarter of momentum and growth," stated Richard W. Akam, CEO of American Restaurant Concepts. "We completed the turnaround of our franchisees' operations this past year, and the results showed. Royalty revenue, a principal measure of our operational success due to its recurring nature, increased 23% over 2012. Our sequential growth was underpinned by the quality and efficiency of our execution."
"We also improved our liquidity and borrowing capacity for strategic growth plans by paying off our outstanding debt obligations to Bank of America and other parties, and securing a $1 million revolving credit facility from Blue Victory Holdings," continued Akam. "Our net loss increased this year as a result of greatly increased operating expenses. However, these expenditures were necessary to complete the turnaround of our franchisees operations and position the Company for future expansion and acquisition efforts. We are well positioned financially for 2014."
The Company continued to perform well in a challenging environment, with a number of noteworthy achievements and organizational changes during 2013. The Company:
- Appointed new executive management personnel and board members, and new non-management personnel.
- Completed the turnaround of its franchisees' operations, improving franchisee sales and profitability.
- Secured a $1 million revolving line of credit facility from Blue Victory Holdings, a Louisiana-based private equity firm.
- Completed a 1-for-7 reverse stock split of its shares of common stock to make its stock more attractive to institutional investors and strategic partners.
- Executed a sponsorship agreement with the Jacksonville Jaguars and opened a concession stand at EverBank Field.
During 2013, the Company began marketing its Dicks' Wings restaurants as family fun fooderys™ where families and sports fans can go to enjoy a unique restaurant experience from first bite to last call™. As part of this rebranding strategy, the Company introduced a new Dick's Wings logo, menu and website. It also introduced its Dick's Blingz™ boneless chicken wings to target the new and fast-growing group of young Americans who prefer boneless chicken wings to bone-in chicken wings. To maximize the benefits of these measures, the Company engaged the Upside Group Franchise Consulting to help it design and implement a comprehensive branding platform to accelerate sales of new restaurant franchises.
"Our customers remain our top focus and the key to our ongoing success," Akam stated. "Our new image gives us a sleeker, more modern look that better embodies our target customers. The freshening of our concept coupled with the introduction of Dick's Blingz is helping us attract more customers to our restaurants and welcome more people of all demographics to the Dick's Wings brand. These measures have also made our brand more marketable to prospective franchisees, which we are capitalizing on through our work with the Upside Group."
Outlook for 2014
The Company will be executing a multi-faceted growth strategy during 2014. The first component of its growth strategy consists of the continued strengthening and expansion of its legacy Dick's Wings brand. The Company's rebranding measures and work with the Upside Group, coupled with a larger marketing and advertising budget, will help the Company drive growth in the number of Dick's Wings restaurants during 2014. The Company's efforts should be positively influenced by trends that are creating favorable conditions for its franchisees, such as increasing consumer demand for chicken wings, decreases in the wholesale price of chicken, and a gradually improving U.S. economy.
The second component of the Company's growth strategy is the acquisition of controlling and non-controlling financial interests in leading restaurant brands offering product and geographic diversification. The Company recently completed the acquisition of a 50% interest in the franchisor of Wing Nutz®, a Salt Lake City based provider of premium baked chicken wings and other foods, that is projected to generate $200,000 of investment income for the Company during 2014, and expects to complete the acquisition of a leading frozen yogurt chain during its second fiscal quarter.
"Our recent financing transactions have provided us with access to more than $1.3 million in capital during the next 12 months," stated Akam. "This will be more than adequate to enable us to execute upon our growth strategy during 2014. Importantly, as we grow, we are improving operational efficiencies and formalizing best practices throughout our franchise. This will help us achieve our long-term goal of transforming American Restaurant Concepts into a holding company comprised of a diversified portfolio of profitable businesses that are all strong contributors to our bottom line."
"2014 marks the 50th anniversary of the buffalo chicken wing and the 20th anniversary of Dick's Wings," Akam added. "With the decisive actions we've taken to strengthen our Company across the board, we expect 2014 to also mark the breakthrough year for American Restaurant Concepts. We are already off to a great start this year, highlighted by our acquisition of a 50% interest in Wing Nutz, and are excited to continue creating long-term value for our franchisees and shareholders."
About American Restaurant Concepts, Inc.
American Restaurant Concepts, Inc., headquartered in Lafayette, Louisiana, is the operator and franchisor of the Dick's Wings & Grill® full-service restaurants and Dick's Wings Express® express restaurants. The Company prides itself on its award-winning chicken wings, for which it boasts 365 mouth-watering flavors. It offers customers the freshest wings, sandwiches, burgers, wraps, salads and signature waffle fries, all in a unique setting that combines a family-friendly environment with a sports-themed restaurant. The Company currently has 15 full-service restaurants and one express restaurant. For more information, please visit the Company's website at 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 29, 2013 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.
SOURCE American Restaurant Concepts, Inc.