LOS ANGELES - FAT Brands Inc. (NASDAQ:FAT), the parent company of multiple well-known restaurant chains, has announced a quarterly cash dividend of $0.14 per share for both its Class A and Class B common stock. This dividend is scheduled for payment on November 29, 2024, to shareholders on record as of November 15, 2024.
The company, which oversees a diverse portfolio of eighteen restaurant brands—including Round Table Pizza, Fatburger, and Johnny Rockets—has stated that the continuation and amount of future dividends are at the discretion of the Board of Directors. Factors influencing future dividends include operational results, financial status, capital requirements, and other relevant considerations.
FAT Brands has emphasized that while the current dividend has been declared, there is no guarantee of subsequent dividends. The decision to issue dividends will be made based on the company's performance and strategic financial decisions moving forward.
The franchising company currently owns and operates over 2,300 units globally, with a brand roster that also features Marble Slab Creamery, Twin Peaks, and Smokey Bones among others. The company is known for acquiring and developing fast service and casual dining restaurant concepts around the world.
The information provided in this article is based on a press release statement from FAT Brands Inc. The release also includes forward-looking statements that are subject to various risks and uncertainties. These statements do not guarantee future performance and may differ materially from current expectations due to several factors beyond the company's control. FAT Brands routinely files documents with the Securities and Exchange Commission, where more detailed discussions of potential risks and uncertainties can be found.
Investors and shareholders are reminded that FAT Brands does not commit to updating any forward-looking statements post the date of the press release.
In other recent news, Fat Brands Inc. has been making significant strides in its business operations. The company has reported a substantial increase in total revenue by 42.4% to $152 million and a rise in system-wide sales by 7.3% to $614.7 million compared to the same period last year. Despite reporting a net loss of $39.4 million for the quarter, the company is optimistic about its future prospects, particularly in the polished casual segment.
Fat Brands has also announced a monthly cash dividend for its 8.25% Series B Cumulative Preferred Stock, set at $0.171875 per share. This declaration reflects the company's commitment to deliver shareholder value through consistent returns. The company has been expanding its portfolio of restaurant brands across various markets, leveraging its established brands to generate recurring revenue streams.
Furthermore, as part of its growth strategy, Fat Brands is planning to open 120 new units this year, primarily focusing on the polished casual segment. The company is also considering acquisitions in categories such as salad, sandwich, and coffee brands. The Georgia-based manufacturing facility contributed $3.8 million to adjusted EBITDA in Q2, a 9.3% increase from last year. These are some of the recent developments that underscore Fat Brands' ongoing efforts to position itself for future growth.
InvestingPro Insights
FAT Brands Inc.'s recent dividend announcement aligns with its track record of shareholder returns. According to InvestingPro data, the company currently offers a substantial dividend yield of 10.57%. This high yield is particularly noteworthy given that FAT Brands has raised its dividend for three consecutive years, as highlighted by an InvestingPro Tip.
However, investors should approach this attractive dividend with caution. InvestingPro Tips reveal that FAT Brands operates with a significant debt burden and is quickly burning through cash. The company's short-term obligations exceed its liquid assets, which could potentially impact its ability to maintain such generous dividends in the long term.
On the operational front, FAT Brands has shown strong top-line growth. The company's revenue increased by 36.36% over the last twelve months, reaching $572.01 million. This growth trend is expected to continue, with analysts anticipating sales growth in the current year.
Despite the revenue growth, profitability remains a concern. InvestingPro data indicates that FAT Brands was not profitable over the last twelve months, with a negative operating income of $16.51 million. This financial situation underscores the importance of the company's forward-looking statements regarding future dividends.
For investors seeking a more comprehensive analysis, InvestingPro offers additional tips and insights. There are 12 more InvestingPro Tips available for FAT Brands, providing a deeper understanding of the company's financial health and market position.
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