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Carrols Restaurant Group reports net loss in 1st quarter

By Eric Reinhardt (ereinhardt@cnybj.com)

Date:

The Burger King restaurant location at 955 W. Genesee St. in Syracuse. (Eric Reinhardt / CNYBJ file photo)

SYRACUSE, N.Y. — Carrols Restaurant Group, Inc. (NASDAQ: TAST), the nation’s largest Burger King franchisee, reported a net loss of more than $21 million, or 42 cents a share, during the first quarter of 2022 that ended April 3.

The figures compared to a net loss of $7.2 million, or 14 cents a share, in the prior year quarter.

The net loss in the first quarter of this year included $500,000 in impairment and other lease charges; $1.9 million in executive transition, litigation, and other professional expenses; and a $2.2 million valuation allowance for deferred taxes, Carrols said in its earnings report. Among other items, net loss in the first quarter of 2021 included a $400,000 in impairment and other lease charges and $300,000 in litigation and other professional expenses, among other items.

Syracuse–based Carrols also reported Q1 total restaurant sales of nearly $400 million, an increase of 2.4 percent to compared to its $390 million in sales during the first quarter of 2021.

The company noted that comparable restaurant sales for its Burger King restaurants increased 1.6 percent and for its Popeyes restaurants increased 2.2 percent during the first quarter of 2022.

“We grew comparable restaurant sales at our Burger King restaurants during the first quarter by 1.6% against a formidable 14.7% comparison in the prior year period through average check growth of 9.9%, inclusive of menu price increases and lower promotional activity, that was partially offset by a traffic decline of 7.5%,” Paulo Pena, president and CEO of Carrols Restaurant Group, said. “Higher delivery sales contributed to average check growth, rising to 6.2% of total restaurant sales in the first quarter of 2022 from 4.8% in the year-ago period and 5.2% in the fourth quarter of last year. However, monthly sales trends were choppy. In January, our traffic was negatively impacted by severe winter storms and staffing issues related to the Omicron variant. In February, our relative performance benefitted from favorable traffic comparisons due to severe winter storms in 2021 and in March we lapped the benefit of stimulus payments from last year.”

Carrols is currently operating 1,026 Burger King restaurants in 23 states as well as 65 Popeyes restaurants in seven states. Carrols has operated Burger King restaurants since 1976 and Popeyes restaurants since 2019, the company said.

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