Nathan's Famous, Inc. Reports Year-End And Fourth Quarter Results

JERICHO, N.Y., June 10, 2016 /PRNewswire/ -- Nathan's Famous, Inc. reported results for its fiscal year and the fourth quarter that ended March 27, 2016.

For the fifty-two weeks ended March 27, 2016:

• Income from operations increased by 25.1% to $24,963,000, as compared to $19,958,000 during the fifty-two weeks ended March 29, 2015;
• Adjusted EBITDA, as subsequently defined, increased by 20.7% to $27,155,000 as compared to $22,497,000 for the fifty-two weeks ended March 29, 2015;
• Net income was $6,096,000, as compared to $11,703,000 for the fifty-two weeks ended March 29, 2015;
• Earnings per diluted share were $1.37 per share, as compared to $2.55 per share for the fifty-two weeks ended March 29, 2015; and
• Revenues were $100,890,000, as compared to $99,112,000 during the fifty-two weeks ended March 29, 2015.

For the thirteen weeks ended March 27, 2016:

• Income from operations increased by 51.2% to $4,486,000, as compared to $2,967,000 during the thirteen weeks endedMarch 29, 2015;
• Adjusted EBITDA, as subsequently defined, increased by 39.5% to $4,966,000 as compared to $3,561,000 for the thirteen weeks ended March 29, 2015;
• Net income was $507,000, as compared to $1,537,000 for the thirteen weeks ended March 29, 2015;
• Earnings per diluted share were $0.12 per share, as compared to $0.34 per share for the thirteen weeks ended March 29, 2015; and
• Revenues were $19,053,000, as compared to $20,340,000 during the thirteen weeks ended March 29, 2015.

"Fiscal 2016 was a very strong year for Nathan's Famous," said Eric Gatoff, the company's Chief Executive Officer. "Our Branded Products Program, licensing program and Company-owned restaurants all delivered outstanding results, helping the Company achieve the highest Income from operations in its history."

The Company reported the following:

• License royalties increased by 10.0% to $19,815,000 during the fifty-two weeks ended March 27, 2016, as compared to$18,011,000 during the fifty-two weeks ended March 29, 2015. During the fifty-two weeks ended March 27, 2016, total royalties earned under the John Morrell & Co., agreement increased by 11.6% to $17,975,000 as compared to $16,105,000of royalties earned during the fifty-two weeks ended March 29, 2015. The increase is substantially attributable to significant organic growth in our consumer packaged hot dog business as a result of more effective sales, marketing and promotional strategies. 
  
• Sales from the Branded Product Program, featuring the sale of Nathan's hot dogs to the foodservice industry, were$58,545,000 during the fifty-two weeks ended March 27, 2016, as compared to sales of $58,948,000 during the fifty-two weeks ended March 29, 2015. This change was attributable to a 4.6% increase in the volume of products sold, which was offset by lower average selling prices of 3.7% due to the impact of lower beef prices on that portion of our Branded Products business that is sold to larger customers using formula prices tied to the underlying beef markets. 
  
• Sales from Company-operated restaurants increased by 5.0% to $16,664,000 during the fifty-two weeks ended March 27, 2016 as compared to $15,874,000 during the fifty-two weeks ended March 29, 2015 driven primarily from higher sales at both Coney Island locations. 
  
• Revenues from franchise operations were $5,044,000 during the fifty-two weeks ended March 27, 2016, as compared to$5,581,000 during the fifty-two weeks ended March 29, 2015. Total franchise fee income was $751,000 during the fifty-two weeks ended March 27, 2016 as compared to $1,043,000 during the fifty-two weeks ended March 29, 2015, primarily due to lower international development fees. Fifty-six new franchised units were opened during the fifty-two weeks endedMarch 27, 2016, including 25 international locations, comprised of our first two locations in each of Panama and Australia, 17 locations in Russia, two locations in Malaysia, one unit in Costa Rica, one unit in the Dominican Republic and 22 Branded Menu Program outlets. Thirty-six new franchised units were opened during the fifty-two weeks ended March 29, 2015, including seventeen Branded Menu Program outlets and thirteen international locations, including our first locations inCosta Rica and Malaysia. We also recognized forfeited fees of $58,000 during the fiscal 2016 period and $143,000 during the fiscal 2015 period. 
  
• On March 10, 2015, Nathan's completed a financing of $135.0 million aggregate principal amount of Senior Secured Notes. Nathan's incurred interest expense, including amortized debt issuance costs, totaling $14,630,000 during the fifty-two weeks ended March 27, 2016 on the Notes. 
  
• During the fifty-two weeks ended March 27, 2106, Nathan's Board of Directors increased the Company's authorization to purchase up to an additional 400,000 shares of its common stock. Purchases may be made from time to time, depending on market conditions, in open market or privately negotiated transactions, at prices deemed appropriate by management. There is no set time limit on the repurchases. As of March 27, 2016, an aggregate 290,874 shares were available for purchase under Nathan's stock buy-back program. Pursuant to prior share repurchase programs authorized by the Board of Directors, Nathan's has purchased a total of 5,096,757 shares of common stock at a cost of approximately $76,031,000through March 27, 2016. 
  
• The Company has also entered into a 10b5-1 plan with Mutual Securities, Inc. ("MSI") pursuant to which MSI has been authorized on the Company's behalf to purchase shares of the Company's common stock. A plan under Rule 10b5-1 allows a company to repurchase its shares at times when it otherwise might be prevented from doing so under the securities laws or because of self-imposed trading blackout periods. Because the repurchases under the plan are subject to pricing parameters, there is no guarantee as to the exact number of shares that will be repurchased under the plan, or that there will be any repurchases pursuant to the plan. Full report.