Attached files
| file | filename |
|---|---|
| 8-K - FORM 8-K - Ignite Restaurant Group, Inc. | irg20150413b_8k.htm |
| EX-99.1 - EXHIBIT 99.1 - Ignite Restaurant Group, Inc. | ex99-1.htm |
Exhibit 99.2
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
On April 17, 2015, Ignite Restaurant Group, Inc. (the “Company” or “Ignite”) completed the sale of Macaroni Grill to Redrock Partners, LLC (the “Purchaser”). The aggregate acquisition price paid at closing was $8.0 million in cash.
The unaudited pro forma condensed consolidated financial statements as of and for the fiscal year ended December 29, 2014 were derived by applying pro forma adjustments to the historical consolidated financial statements of Ignite. The unaudited pro forma condensed consolidated balance sheet as of December 29, 2014 gives effect to the disposition as if the transaction had occurred on December 29, 2014.
The unaudited pro forma condensed consolidated statement of operations for the fiscal year ended December 29, 2014 gives effect to the Company’s disposition of Macaroni Grill as if it had occurred on the first day of fiscal year 2014. The pro forma adjustments related to the disposition of Macaroni Grill give effect to pro forma events that are (1) directly attributable to the disposition, (2) factually supportable, and (3) with respect to the income statement, expected to have a continuing impact on the results of operations of the Company, excluding Macaroni Grill.
The unaudited pro forma condensed consolidated financial statements should be read in conjunction with the accompanying notes to the unaudited pro forma condensed consolidated financial statements and the historical consolidated financial statements and accompanying notes of Ignite included in its Annual Report on Form 10-K for the fiscal year ended December 29, 2014.
The unaudited pro forma condensed consolidated financial statements are presented for informational purposes only and do not purport to represent the Company’s actual financial condition or results of operations had such transactions been completed as of the dates or for the periods indicated above or that may be achieved as of any future date or for any future period. The pro forma adjustments related to the disposition are based on preliminary estimates and information available to management and are subject to change.
The unaudited pro forma condensed consolidated financial statements do not reflect any cost savings or operating synergies that Ignite may achieve as a result of the disposition or the costs necessary to achieve these cost savings and operating synergies.
IGNITE RESTAURANT GROUP, INC.
Unaudited Pro Forma Condensed Consolidated Balance Sheet
December 29, 2014
(in thousands)
|
Historical |
Sale of |
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|
Historical |
Romano's |
Romano's |
Pro Forma |
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|
Ignite(1) |
Macaroni Grill(2) |
Macaroni Grill(3) |
Ignite |
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|
ASSETS |
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|
Current assets |
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|
Cash and cash equivalents |
$ | 18,273 | $ | 2,291 | $ | 7,047 | $ | 27,611 | ||||||||
|
Accounts receivable, net |
12,713 | (4,721 | ) | - | 7,992 | |||||||||||
|
Inventories |
9,319 | (3,471 | ) | - | 5,848 | |||||||||||
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Other current assets |
11,936 | (5,322 | ) | - | 6,614 | |||||||||||
|
Total current assets |
52,241 | (11,223 | ) | 7,047 | 48,065 | |||||||||||
|
Property and equipment, net |
235,954 | (43,012 | ) | - | 192,942 | |||||||||||
|
Intangible assets, net |
28,979 | (23,039 | ) | - | 5,940 | |||||||||||
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Other assets |
10,546 | (5,191 | ) | - | 5,355 | |||||||||||
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Total assets |
$ | 327,720 | $ | (82,465 | ) | $ | 7,047 | $ | 252,302 | |||||||
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LIABILITIES AND STOCKHOLDERS' EQUITY |
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Current liabilities |
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Accounts payable |
$ | 25,381 | $ | (9,730 | ) | $ | - | $ | 15,651 | |||||||
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Accrued liabilities |
51,509 | (22,507 | ) | - | 29,002 | |||||||||||
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Current portion of debt obligations |
1,650 | - | - | 1,650 | ||||||||||||
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Total current liabilities |
78,540 | (32,237 | ) | - | 46,303 | |||||||||||
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Long-term debt obligations |
161,052 | - | - | 161,052 | ||||||||||||
|
Deferred rent |
24,256 | (4,799 | ) | - | 19,457 | |||||||||||
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Other long-term liabilities |
12,573 | (10,950 | ) | - | 1,623 | |||||||||||
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Total liabilities |
276,421 | (47,986 | ) | - | 228,435 | |||||||||||
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Stockholders' equity |
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Preferred stock |
- | - | - | - | ||||||||||||
|
Common stock |
257 | - | - | 257 | ||||||||||||
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Additional paid-in capital |
90,943 | - | - | 90,943 | ||||||||||||
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Accumulated deficit |
(39,901 | ) | (34,479 | ) | 7,047 | (67,333 | ) | |||||||||
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Total stockholders' equity |
51,299 | (34,479 | ) | 7,047 | 23,867 | |||||||||||
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Total liabilities and stockholders' equity |
$ | 327,720 | $ | (82,465 | ) | $ | 7,047 | $ | 252,302 | |||||||
See accompanying notes to unaudited pro forma condensed consolidated financial statements.
IGNITE RESTAURANT GROUP, INC.
Unaudited Pro Forma Condensed Consolidated Statement of Operations
For the Fiscal Year Ended December 29, 2014
(in thousands)
|
Historical |
||||||||||||
|
Historical |
Romano's |
Pro Forma |
||||||||||
|
Ignite(1) |
Macaroni Grill(2) |
Ignite |
||||||||||
|
Revenues |
$ | 837,185 | $ | (333,677 | ) | $ | 503,508 | |||||
|
Costs and expenses |
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Restaurant operating costs and expenses |
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Cost of sales |
253,255 | (89,848 | ) | 163,407 | ||||||||
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Labor expenses |
257,135 | (114,473 | ) | 142,662 | ||||||||
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Occupancy expenses |
77,900 | (38,499 | ) | 39,401 | ||||||||
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Other operating expenses |
175,513 | (81,427 | ) | 94,086 | ||||||||
|
General and administrative |
45,288 | (6,619 | ) | 38,669 | ||||||||
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Depreciation and amortization |
33,774 | (9,873 | ) | 23,901 | ||||||||
|
Pre-opening costs |
2,799 | - | 2,799 | |||||||||
|
Asset impairments and closures |
12,694 | (10,714 | ) | 1,980 | ||||||||
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Loss on disposal of assets |
481 | 859 | 1,340 | |||||||||
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Total costs and expenses |
858,839 | (350,594 | ) | 508,245 | ||||||||
|
Loss from operations |
(21,654 | ) | 16,917 | (4,737 | ) | |||||||
|
Interest expense, net |
(12,521 | ) | - | (12,521 | ) | |||||||
|
Loss on insurance settlements |
(35 | ) | 124 | 89 | ||||||||
|
Loss before income taxes |
(34,210 | ) | 17,041 | (17,169 | ) | |||||||
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Income tax expense |
19,339 | (3,126 | ) | 16,213 | ||||||||
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Net loss |
$ | (53,549 | ) | $ | 20,167 | $ | (33,382 | ) | ||||
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Net loss per share |
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|
Basic and diluted |
$ | (2.09 | ) | $ | (1.30 | ) | ||||||
|
Weighted average shares outstanding |
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|
Basic and diluted |
25,659 | 25,659 | ||||||||||
See accompanying notes to unaudited pro forma condensed consolidated financial statements.
IGNITE RESTAURANT GROUP, INC.
Notes to Unaudited Pro Forma Condensed Consolidated Financial Information
|
(1) |
Reflects the historical consolidated balance sheet and statement of operations of Ignite as included in its Annual Report on Form 10-K as of and for the fiscal year ended December 29, 2014. |
|
|
|
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(2) |
Reflects the historical balance sheet and statement of operations of Macaroni Grill as of and for the fiscal year ended December 29, 2014. |
| (3) | Reflects the sale of Macaroni Grill, including receipt of gross proceeds of $8.0 million net of estimated transaction expenses of approximately $1.0 million that are directly attributable to the sale. |
|
Selling price |
$ | 8,000 | ||
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Transaction expenses |
(953 | ) | ||
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Net proceeds |
7,047 | |||
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Less: Carrying value of net assets sold |
34,479 | |||
|
Net loss on sale of Macaroni Grill |
$ | 27,432 |
| There is no income tax impact included for the transactions above due to the Company having a full valuation allowance on its deferred tax assets as of December 29, 2014. The pro forma net loss on the sale is based on preliminary estimates and is subject to change. |