St. Louis brand continues to exceed
expectations.
TORONTO, March 11,
2024 /CNW/ - Today, Aegis Brands Inc. (TSX: AEG) has
reported financial results for the fourth quarter and year end as
of December 31st,
2023.
Highlights:
- System sales of $32.8 million in
the fourth quarter increased by 19.1% over last year and for the
year increased to $125.2 million or
12.2% over the prior year
- Same store sales accelerated through the year and increased by
9.4% in Q4.
- Operating income from continuing operations for the year was
$2.1 million compared to a loss of
$8.3 million last year
- Net loss from continuing operations for the year was
$1.0 million or $0.01 per share compared to $7.6 million or $0.31 per share last year.
- EBITDA from continuing operations for the year was $3.5 million compared to an EBITDA loss of
$3.2 million when adjusted for asset
impairment charges
- Aegis closed the previously announced sale of the assets of
Bridgehead Coffee on March
8th, 2024.
St. Louis
Bar & Grill
St. Louis contributed
$4.6 million and $5.9 million in Net income and EBITDA
respectively for the 2023 year. Same store sales rose by 9.4% in
the fourth quarter and 7.8% for the year. St. Louis opened four new stores and closed
none in the past year. Currently the brand has expanded to six
provinces and 78 stores in total.
"St. Louis continues to grow
sales organically", said Steven
Pelton, President and CEO of Aegis Brands Inc. "Our
marketing department's ability to drive traffic into our
restaurants is improving with each promotion or event. As we see
new faces during these events, our focus operationally is to
convert new guests into regulars through providing extraordinary
hospitality. We know if we can give our guest more than they expect
within our four walls during a promotion, they will return, and we
are seeing the results of these efforts. We are very proud of the
people within the stores that are making this happen and we
couldn't be more excited for their continued success."
St. Louis successfully launched
several new initiatives that drove traffic, incremental sales and
profitability for our franchisees:
- Uber Eats was introduced to the majority of the system which
added sales of $6.3 million from its
launch in April to the end of the year.
- The Sweet Jesus brand test as the dessert offering in 15
locations began in the middle of last year. With less than
$500 of capital investment, our best
test stores added $100,000 in
additional annualized sales.
- St. Louis partnered with
Sports Interaction to bring the excitement of betting
on your favorite game into the bar/dining experience of
St. Louis. The partnership creates
an opportunity to host educational launch parties in efforts to
create even more regulars during game days within our Ontario locations. Additionally, franchisees
share in the income produced by this partnership with Sports
Interaction.
- Early in the year, St. Louis
also partnered with Tik Tok and Loop
Media to provide highly engaging and entertaining content on TV
screens across their restaurants. This was the first partnership of
this scale between TikTok and a hospitality brand in Canada. Franchisees also benefit from an
advertising revenue sharing program which further contributes to
the store level profitability.
Wing City by St. Louis
On December 14th, the
first Wing City location opened in Toronto. This location is company owned and
sales have steadily increased week over week. The menu,
hours, and operations continue to evolve while trying to capture
the perfect offering for the fast casual version of St. Louis. The second Wing City location will
open within the next few months at the busy corner of King and
Bathurst in Toronto. This location will be dual branded
with Sweet Jesus.
Bridgehead
On March 8th the
company closed the sale of the assets of its roasting, wholesale
and coffeehouse business, excluding certain specified assets, for a
purchase price of $3,500,000 in cash
and the assumption of certain liabilities, to Pilot Coffee Group of
Companies.
"This strategic divestiture allows us to build on the momentum
of the St. Louis brand. We know there is significant growth yet to
be realized with this brand and we are focused on creating
shareholder value with this great asset." said Pelton.
Aegis
After several challenging years, Aegis is now positioned for
growth. The company is a very different company now than it has
been in recent years. "We are excited about our future and are
focused on growth and opportunities, not legacy problems" said
Pelton. In 2023, Aegis brought on Chris
Fountain as VP of Development at St. Louis and quickly promoted Chris to Chief
Operating Officer at Aegis. Chris was the CEO and a partner at Pita
Pit until they successfully sold the business in 2021. Pita Pit at
its peak had 600+ stores operating in 13 countries.
The next step in the evolution of Aegis is to propose a
rejuvenated slate of Directors for the shareholders to vote in at
this year's Annual General Meeting in May. This new slate will
include Anthony Longo, CEO
of Longo's, and a significant shareholder of Aegis.
Michael Bregman will step down as
Chairman of the Board and will be succeeded by Anthony, if elected.
Anthony's extensive knowledge and experience will be invaluable as
Aegis enters this new stage.
About Aegis Brands
Aegis Brands owns and operates St. Louis Bar and Grill and Wing
City by St. Louis. The Company is
committed to letting each brand operate independently while
providing shared expertise to help them thrive. For more
information, please visit www.aegisbrands.ca.
NON-IFRS MEASURES
Aegis measures the success of its business in part by employing
several key performance indicators referenced herein that are not
recognized under IFRS, including same store sales and EBITDA.
These indicators should not be considered an alternative to IFRS
financial measures, such as net income, and are presented in this
presentation because management of Aegis believes that such
measures are relevant in interpreting the performance of its
business. As non‐IFRS financial measures do not have standardized
definitions prescribed by IFRS, they are less likely to be
comparable with other issuers or peer companies. A description of
the non‐IFRS measures used by Aegis in measuring its performance
and a reconciliation of certain non‐IFRS measures to the
nearest IFRS measure is included in Aegis' management's discussion
and analysis for the year ended December 31,
2023 available on SEDAR at www.sedarplus.ca.
FORWARD LOOKING STATEMENTS
This press release contains forward-looking statements within
the meaning of Canadian securities laws. The forward-looking
statements included in this press release, including statements
regarding the nature of Aegis' growth strategy going forward and
Aegis' execution on any of its potential plans (including with
respect to the growth and development of St. Louis Bar and Grill
and Wing City), are not guarantees of future results and involve
risks and uncertainties that may cause actual results to differ
materially from the potential results discussed in the
forward-looking statements.
Risks and uncertainties that may cause such differences include
but are not limited to: risks related to the company's
strategy going forward; risks related to the rising interest rates
and inflationary pressures on the cost of doing business; and other
risks inherent in the industry in which Aegis operates.
Accordingly, readers should not place undue reliance on the
forward-looking statements and information contained in this news
release. Additional information on these and other factors
that could affect Aegis' operations or financial results are
included in reports on file with applicable securities regulatory
authorities and may be accessed through the SEDAR website
(www.sedarplus.ca).
The forward-looking statements in this press release are made as
of the date it was issued and Aegis does not undertake any
obligation to update publicly or to revise any of the included
forward-looking statements, whether as a result of new information,
future events or otherwise, except as required by applicable
law.
For more information, please visit aegisbrands.ca.
SOURCE Aegis Brands Inc.