After closing two Good Times locations over the past six months, leaders of the Lakewood-based restaurant chain said Thursday that they will continue to examine whether to cease operations at other stores that are not profitable.
The statement, made during the Good Times Restaurants Inc. (Nasdaq: GTIM) third-quarter earnings call, came despite the fact that the company’s Good Times Burgers & Frozen Custard brand recorded positive same-store sales for the sixth quarter in a row, while its full-service Bad Daddy’s Burger Bar brand increased comparable sales for the 13th quarter in a row. After struggling at times with its profitability — so much so that two board members quit late last year before the company reached a deal to bring them back to their positions — Good Times also recorded a diluted income of two cents per share in the fiscal quarter that ended on June 26, up from a 2-cent-per-share loss during the third quarter of 2017.
But even with those big-picture successes, CFO Ryan Zink noted that the company shut down an Aurora store during the second quarter of this fiscal year and then shuttered a Denver location in the recently ended quarter, both of which Good Times intends to sublease to other businesses for amounts that are equal or greater than the income that the stores were generating. And he said officials will examine other Good Times stores that are struggling with profitability to see if those locations also would prove better to the company’s bottom line with a similar closing strategy.
“We have a very small number of slightly unprofitable or marginally unprofitable Good Times locations,” Zink emphasized.
Overall, quarterly same-store sales at Good Times’ 36 locations increased 3.8 percent year-over-year, while comparable sales at Bad Daddy’s rose 0.5 percent for the quarter. Combined net quarterly revenues jumped 20 percent year-over to $26.2 million.