Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2022 | Oct. 31, 2022 | |
Document and Entity Information [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Sep. 30, 2022 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q3 | |
Current Fiscal Year End Date | --12-31 | |
Entity File Number | 001-37379 | |
Entity Registrant Name | ONE GROUP HOSPITALITY, INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 14-1961545 | |
Entity Address, Address Line One | 1624 Market Street | |
Entity Address, Address Line Two | Suite 311 | |
Entity Address, City or Town | Denver | |
Entity Address, State or Province | CO | |
Entity Address, Postal Zip Code | 80202 | |
City Area Code | 646 | |
Local Phone Number | 624-2400 | |
Title of 12(b) Security | Common Stock | |
Trading Symbol | STKS | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 32,265,504 | |
Entity Central Index Key | 0001399520 | |
Amendment Flag | false |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 17,477 | $ 23,614 |
Accounts receivable | 8,454 | 11,356 |
Inventory | 4,988 | 3,915 |
Other current assets | 2,274 | 3,666 |
Due from related parties | 376 | 376 |
Total current assets | 33,569 | 42,927 |
Property and equipment, net | 85,466 | 69,638 |
Operating lease right-of-use assets | 84,928 | 85,395 |
Deferred tax assets, net | 12,096 | 12,313 |
Intangibles, net | 15,283 | 15,505 |
Other assets | 4,231 | 3,199 |
Security deposits | 810 | 858 |
Total assets | 236,383 | 229,835 |
Current liabilities: | ||
Accounts payable | 11,557 | 11,094 |
Accrued expenses | 17,613 | 23,155 |
Deferred license revenue | 79 | 90 |
Deferred gift card revenue and other | 1,426 | 2,029 |
Current portion of operating lease liabilities | 6,114 | 5,396 |
Current portion of long-term debt | 500 | 500 |
Total current liabilities | 37,289 | 42,264 |
Deferred license revenue, long-term | 238 | 298 |
Operating lease liabilities, net of current portion | 105,038 | 103,616 |
Long-term debt, net of current portion | 27,940 | 23,132 |
Total liabilities | 170,505 | 169,310 |
Commitments and contingencies (Note 15) | ||
Stockholders' equity: | ||
Common stock, $0.0001 par value, 75,000,000 shares authorized; 32,744,362 issued and 32,231,728 outstanding at September 30, 2022 and 32,138,396 issued and 32,125,762 outstanding at December 31, 2021 | 3 | 3 |
Preferred stock, $0.0001 par value, 10,000,000 shares authorized; no shares issued and outstanding at September 30, 2022 and December 31, 2021, respectively | ||
Treasury stock, 512,634 and 12,634 shares at cost at September 30, 2022 and December 31, 2021, respectively | (3,540) | (37) |
Additional paid-in capital | 54,347 | 53,481 |
Retained earnings | 19,087 | 10,632 |
Accumulated other comprehensive loss | (2,993) | (2,645) |
Total stockholders' equity | 66,904 | 61,434 |
Noncontrolling interests | (1,026) | (909) |
Total equity | 65,878 | 60,525 |
Total liabilities and equity | $ 236,383 | $ 229,835 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Sep. 30, 2022 | Dec. 31, 2021 |
CONDENSED CONSOLIDATED BALANCE SHEETS | ||
Common stock, par value per share (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 75,000,000 | 75,000,000 |
Common stock, shares issued | 32,744,362 | 32,138,396 |
Common stock, shares outstanding | 32,231,728 | 32,125,762 |
Preferred stock, par value per share (in dollars per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Treasury stock, shares | 512,634 | 12,634 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Revenues: | ||||
Owned restaurant net revenue | $ 69,538 | $ 67,966 | $ 216,984 | $ 184,982 |
Management, license and incentive fee revenue | 3,482 | 3,903 | 11,342 | 8,129 |
Total revenues | 73,020 | 71,869 | 228,326 | 193,111 |
Owned operating expenses: | ||||
Owned restaurant cost of sales | 17,281 | 17,733 | 55,231 | 46,925 |
Owned restaurant operating expenses | 43,136 | 38,640 | 126,818 | 101,882 |
Total owned operating expenses | 60,417 | 56,373 | 182,049 | 148,807 |
General and administrative (including stock-based compensation of $1,001, $653, $2,791 and $2,812 for the three and nine months ended September 30, 2022 and 2021, respectively) | 6,447 | 5,959 | 20,587 | 17,272 |
Depreciation and amortization | 2,930 | 2,572 | 8,571 | 7,766 |
COVID-19 related expenses | 0 | 1,131 | 2,534 | 3,776 |
Agreement restructuring expenses | 494 | |||
Pre-opening expenses | 2,684 | 587 | 3,833 | 842 |
Lease termination expenses | 58 | 255 | 352 | |
Transaction costs | 51 | 131 | 51 | 131 |
Total costs and expenses | 72,529 | 66,811 | 217,880 | 179,440 |
Operating income | 491 | 5,058 | 10,446 | 13,671 |
Other expenses (income), net: | ||||
Interest expense, net | 435 | 781 | 1,387 | 3,262 |
Loss on early debt extinguishment | 600 | 600 | ||
Gain on CARES Act Loan Forgiveness | (9,968) | (18,529) | ||
Total other expenses (income), net | 435 | (8,587) | 1,387 | (14,667) |
Income before provision for income taxes | 56 | 13,645 | 9,059 | 28,338 |
(Benefit) provision for income taxes | (321) | 1,544 | 721 | 2,188 |
Net income | 377 | 12,101 | 8,338 | 26,150 |
Less: net (loss) income attributable to noncontrolling interest | (105) | 430 | (117) | 573 |
Net income attributable to The One Group Hospitality, Inc. | 482 | 11,671 | 8,455 | 25,577 |
Currency translation loss | (87) | (34) | (348) | (44) |
Comprehensive income attributable to The ONE Group Hospitality, Inc. | $ 395 | $ 11,637 | $ 8,107 | $ 25,533 |
Net income attributable to The ONE Group Hospitality, Inc. per share: | ||||
Basic net income per share | $ 0.01 | $ 0.36 | $ 0.26 | $ 0.83 |
Diluted net income per share | $ 0.01 | $ 0.34 | $ 0.25 | $ 0.75 |
Shares used in computing basic income per share | 32,663,549 | 31,993,557 | 32,496,780 | 30,830,521 |
Shares used in computing diluted income per share | 33,921,498 | 34,380,573 | 34,062,661 | 34,223,857 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME | ||||
Stock-based compensation | $ 1,001 | $ 653 | $ 2,791 | $ 2,812 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Common stock | Treasury stock | Additional paid-in capital | Retained earnings | Accumulated other comprehensive loss | Parent Two [Member] | Stockholders' equity | Noncontrolling interests | Total |
Balance at Dec. 31, 2020 | $ 3 | $ 46,538 | $ (20,716) | $ (2,646) | $ 21,979 | $ 23,179 | $ (1,200) | ||
Balance (in shares) at Dec. 31, 2020 | 29,083,183 | ||||||||
Stock-based compensation | 1,022 | 1,022 | 1,022 | ||||||
Stock-based compensation, in shares | 25,643 | ||||||||
Exercise of stock options and warrants (in shares) | 450,971 | ||||||||
Issuance of vested restricted shares, net of tax withholding | (154) | (154) | (154) | ||||||
Issuance of vested restricted shares, net of tax withholding (in shares) | 67,685 | ||||||||
Purchase of noncontrolling interest | 116 | (75) | 116 | (191) | |||||
Gain (Loss) on foreign currency translation, net | (18) | (18) | (18) | ||||||
Net income (loss) | 70 | (60) | 70 | (130) | |||||
Balance at Mar. 31, 2021 | $ 3 | 47,522 | (20,646) | (2,664) | 22,694 | 24,215 | (1,521) | ||
Balance (in shares) at Mar. 31, 2021 | 29,627,482 | ||||||||
Balance at Dec. 31, 2020 | $ 3 | 46,538 | (20,716) | (2,646) | 21,979 | 23,179 | (1,200) | ||
Balance (in shares) at Dec. 31, 2020 | 29,083,183 | ||||||||
Net income (loss) | $ 25,577 | ||||||||
Balance at Sep. 30, 2021 | $ 3 | $ (37) | 52,519 | 4,861 | (2,690) | 53,838 | 54,656 | (818) | |
Balance (in shares) at Sep. 30, 2021 | 32,094,253 | ||||||||
Balance at Mar. 31, 2021 | $ 3 | 47,522 | (20,646) | (2,664) | 22,694 | 24,215 | (1,521) | ||
Balance (in shares) at Mar. 31, 2021 | 29,627,482 | ||||||||
Stock-based compensation | 741 | 741 | 741 | ||||||
Stock-based compensation, in shares | 9,210 | ||||||||
Exercise of stock options and warrants | 3,151 | 3,151 | 3,151 | ||||||
Exercise of stock options and warrants (in shares) | 931,558 | ||||||||
Issuance of vested restricted shares, net of tax withholding (in shares) | 1,297,525 | ||||||||
Gain (Loss) on foreign currency translation, net | 8 | 8 | 8 | ||||||
Net income (loss) | 13,836 | 14,109 | 13,836 | 273 | |||||
Balance at Jun. 30, 2021 | $ 3 | 51,414 | (6,810) | (2,656) | 40,703 | 41,951 | (1,248) | ||
Balance (in shares) at Jun. 30, 2021 | 31,865,775 | ||||||||
Stock-based compensation | 679 | 679 | 679 | ||||||
Stock-based compensation, in shares | 18,978 | ||||||||
Exercise of stock options | 426 | 426 | 426 | ||||||
Exercise of stock options (in shares) | 200,000 | ||||||||
Issuance of vested restricted shares, net of tax withholding (in shares) | 9,500 | ||||||||
Purchase of treasury stock | (37) | (37) | (37) | ||||||
Gain (Loss) on foreign currency translation, net | (34) | (34) | (34) | ||||||
Net income (loss) | 11,671 | 12,101 | 11,671 | 430 | 11,671 | ||||
Balance at Sep. 30, 2021 | $ 3 | (37) | 52,519 | 4,861 | (2,690) | 53,838 | 54,656 | (818) | |
Balance (in shares) at Sep. 30, 2021 | 32,094,253 | ||||||||
Balance at Dec. 31, 2021 | $ 3 | (37) | 53,481 | 10,632 | (2,645) | 60,525 | 61,434 | (909) | 61,434 |
Balance (in shares) at Dec. 31, 2021 | 32,125,762 | ||||||||
Stock-based compensation | 879 | 879 | 879 | ||||||
Stock-based compensation, in shares | 7,162 | ||||||||
Issuance of vested restricted shares, net of tax withholding | (314) | (314) | (314) | ||||||
Issuance of vested restricted shares, net of tax withholding (in shares) | 127,413 | ||||||||
Gain (Loss) on foreign currency translation, net | (92) | (92) | (92) | ||||||
Net income (loss) | 3,670 | 3,521 | 3,670 | (149) | |||||
Balance at Mar. 31, 2022 | $ 3 | (37) | 54,046 | 14,302 | (2,737) | 64,519 | 65,577 | (1,058) | |
Balance (in shares) at Mar. 31, 2022 | 32,260,337 | ||||||||
Balance at Dec. 31, 2021 | $ 3 | (37) | 53,481 | 10,632 | (2,645) | 60,525 | 61,434 | (909) | $ 61,434 |
Balance (in shares) at Dec. 31, 2021 | 32,125,762 | ||||||||
Exercise of stock options (in shares) | 13,261 | ||||||||
Purchase of common stock | $ (3,500) | ||||||||
Purchase of common stock (in shares) | 500,000 | ||||||||
Net income (loss) | $ 8,455 | ||||||||
Balance at Sep. 30, 2022 | $ 3 | (3,540) | 54,347 | 19,087 | (2,993) | 65,878 | 66,904 | (1,026) | 66,904 |
Balance (in shares) at Sep. 30, 2022 | 32,231,728 | ||||||||
Balance at Mar. 31, 2022 | $ 3 | (37) | 54,046 | 14,302 | (2,737) | 64,519 | 65,577 | (1,058) | |
Balance (in shares) at Mar. 31, 2022 | 32,260,337 | ||||||||
Stock-based compensation | 911 | 911 | 911 | ||||||
Stock-based compensation, in shares | 10,214 | ||||||||
Exercise of stock options and warrants | 28 | 28 | 28 | ||||||
Exercise of stock options and warrants (in shares) | 13,261 | ||||||||
Issuance of vested restricted shares, net of tax withholding | (1,242) | (1,242) | (1,242) | ||||||
Issuance of vested restricted shares, net of tax withholding (in shares) | 365,589 | ||||||||
Gain (Loss) on foreign currency translation, net | (169) | (169) | (169) | ||||||
Net income (loss) | 4,303 | 4,440 | 4,303 | 137 | |||||
Balance at Jun. 30, 2022 | $ 3 | (37) | 53,743 | 18,605 | (2,906) | 68,487 | 69,408 | (921) | |
Balance (in shares) at Jun. 30, 2022 | 32,649,401 | ||||||||
Stock-based compensation | 1,001 | 1,001 | 1,001 | ||||||
Stock-based compensation, in shares | 11,293 | ||||||||
Issuance of vested restricted shares, net of tax withholding | (397) | (397) | (397) | ||||||
Issuance of vested restricted shares, net of tax withholding (in shares) | 71,034 | ||||||||
Purchase of common stock | (3,503) | (3,503) | (3,503) | ||||||
Purchase of common stock (in shares) | (500,000) | ||||||||
Gain (Loss) on foreign currency translation, net | (87) | (87) | (87) | ||||||
Net income (loss) | 482 | 377 | 482 | (105) | 482 | ||||
Balance at Sep. 30, 2022 | $ 3 | $ (3,540) | $ 54,347 | $ 19,087 | $ (2,993) | $ 65,878 | $ 66,904 | $ (1,026) | $ 66,904 |
Balance (in shares) at Sep. 30, 2022 | 32,231,728 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Operating activities: | |||||
Net income | $ 377 | $ 12,101 | $ 8,338 | $ 26,150 | |
Adjustments to reconcile net income to net cash provided by operating activities: | |||||
Depreciation and amortization | 2,930 | 2,572 | 8,571 | 7,766 | |
Stock-based compensation | 2,791 | 2,442 | |||
CARES Act loan forgiveness | (18,529) | ||||
Amortization of debt issuance costs | 279 | 321 | |||
Deferred taxes | 217 | 1,504 | |||
Loss on early debt extinguishment | 600 | 600 | $ 600 | ||
Changes in operating assets and liabilities: | |||||
Accounts receivable | 2,971 | (2,611) | |||
Inventory | (1,073) | (516) | |||
Other current assets | 1,380 | (811) | |||
Security deposits | 48 | 7 | |||
Other assets | (494) | (348) | |||
Accounts payable | (841) | 2,314 | |||
Accrued expenses | (7,784) | 5,454 | |||
Operating lease liabilities and right-of-use assets | 2,607 | 1,045 | |||
Deferred gift card and license revenue | (674) | (1,758) | |||
Net cash provided by operating activities | 16,336 | 23,030 | |||
Investing activities: | |||||
Purchase of property and equipment | (21,309) | (8,112) | |||
Net cash used in investing activities | (21,309) | (8,112) | |||
Financing activities: | |||||
Borrowings of long-term debt | 5,000 | ||||
Repayments of long-term debt | (375) | (22,633) | |||
Debt issuance costs | (866) | ||||
Exercise of stock options and warrants | 28 | 3,577 | |||
Tax-withholding obligation on stock-based compensation | (1,953) | (154) | |||
Purchase of common stock | (3,503) | (37) | |||
Purchase of non-controlling interests | (75) | ||||
Net cash used in financing activities | (803) | (20,188) | |||
Effect of exchange rate changes on cash | (361) | (37) | |||
Net decrease in cash and cash equivalents | (6,137) | (5,307) | |||
Cash and cash equivalents, beginning of period | 23,614 | 24,385 | 24,385 | ||
Cash and cash equivalents, end of period | $ 17,477 | $ 19,078 | 17,477 | 19,078 | $ 23,614 |
Supplemental disclosure of cash flow data: | |||||
Interest paid, net of capitalized interest | 1,056 | 3,118 | |||
Income taxes paid | 293 | 53 | |||
Non-cash CARES Act loan forgiveness | $ 18,529 | ||||
Accrued purchases of property and equipment | $ 4,355 |
Summary of Business and Signifi
Summary of Business and Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2022 | |
Summary of Significant Accounting Policies | |
Summary of Business and Significant Accounting Policies | Note 1 – Summary of Business and Significant Accounting Policies Summary of Business The ONE Group Hospitality, Inc. and its subsidiaries (collectively, the “Company”) is a global restaurant company that develops, owns and operates, manages and licenses upscale and polished casual, high-energy restaurants and lounges and provides turn-key food and beverage (“F&B”) services and consulting services for hospitality venues including hotels, casinos and other high-end locations. Turn-key F&B services are food and beverage services that can be scaled, customized and implemented by the Company at a particular hospitality venue and customized for the client. The Company’s primary restaurant brands are STK, a multi-unit steakhouse concept that combines a high-energy, social atmosphere with the quality and service of a traditional upscale steakhouse, and Kona Grill, a polished casual bar-centric grill concept featuring American favorites, award-winning sushi, and specialty cocktails in a polished casual atmosphere. As of September 30, 2022, the Company owned, operated, managed, or licensed 61 venues, including 23 STKs and 24 Kona Grills in major metropolitan cities in North America, Europe and the Middle East and 14 F&B venues in seven hotels and casinos in the United States and Europe. For those restaurants and venues that are managed or licensed, the Company generates management fees based on top-line revenues and incentive fee revenue based on a percentage of the location’s revenues and profits. COVID-19 In response to COVID-19, the Company has taken significant steps to adapt its business to increase sales while providing a safe environment for guests and employees. COVID-19 related expenses were zero and $2.5 million for the three and nine months ended September 30, 2022, compared to $1.1 million and $3.8 million for the three and nine months ended September 30, 2021, respectively, composed primarily of sanitation, supplies and safety precautions taken to prevent the spread of COVID-19. Basis of Presentation The accompanying condensed consolidated balance sheet as of December 31, 2021, which has been derived from audited financial statements, and the accompanying unaudited interim condensed consolidated financial statements (“condensed consolidated financial statements”) of the Company have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) and in accordance with accounting principles generally accepted in the United States (“GAAP”). Certain information and footnote disclosures normally included in annual audited financial statements have been omitted pursuant to SEC rules and regulations. These unaudited interim condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021. In the Company’s opinion, the accompanying unaudited interim financial statements reflect all adjustments (consisting only of normal recurring accruals and adjustments) necessary for a fair presentation of the results for the interim periods presented. The results of operations for any interim period are not necessarily indicative of the results expected for the full year. Additionally, the Company believes that the disclosures are sufficient for interim financial reporting purposes. Change in Accounting Estimate Effective April 1, 2022, the Company changed its estimated useful life of the Kona Grill trade name. Based upon the strong performance of the Kona Grill restaurants over the twelve months ended March 31, 2022, significant capital investments in both existing and new restaurants and the Company’s commitment to expand the Kona Grill brand with the opening of new restaurants, the Company has determined that the Kona Grill trade name has an indefinite life rather than the twenty-year life previously determined. The Company currently has two Kona Grill venues under construction in Riverton, Utah and Columbus, Ohio and plans to open three to five Kona Grills each year for the foreseeable future. The effect of this change in estimate will reduce depreciation and amortization expense by $0.9 million annually, increase net income by $0.9 million annually, and increase basic and diluted As a result of the above change, the Company updated its accounting policy for Intangible Assets and will test for impairment annually on November 1 st Prior Period Reclassifications Certain reclassifications of the 2021 amounts in the segment reporting footnote have been made to conform to the current year presentation. Recent Accounting Pronouncements In June 2016, the Financial Accounting Standards Board (“FASB “) issued Accounting Standards Update (“ASU“) 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. This update requires companies to measure credit losses utilizing a methodology that reflects expected credit losses and requires a consideration of a broader range of reasonable and supportable information to estimate credit losses. ASU 2016-13 is effective for smaller reporting companies for fiscal years beginning after December 15, 2022. The Company does not expect the adoption of ASU 2016-13 to have a material impact on its financial statements. |
Property and Equipment, net
Property and Equipment, net | 9 Months Ended |
Sep. 30, 2022 | |
Property and Equipment, net | |
Property and Equipment, net | Note 2 – Property and Equipment, net Property and equipment, net consist of the following (in thousands): September 30, December 31, 2022 2021 Furniture, fixtures and equipment $ 28,580 $ 24,942 Leasehold improvements 81,489 76,500 Less: accumulated depreciation (45,244) (39,425) Subtotal 64,825 62,017 Construction in progress 18,074 5,374 Restaurant smallwares 2,567 2,247 Total $ 85,466 $ 69,638 Depreciation related to property and equipment was $2.9 million and $2.3 million for the three months ended September 30, 2022 and 2021, respectively, and $8.3 million and $7.1 million for the nine months ended September 30, 2022 and 2021, respectively. The Company does not depreciate construction in progress until such assets are placed into service. |
Intangibles, net
Intangibles, net | 9 Months Ended |
Sep. 30, 2022 | |
Intangibles, net | |
Intangibles, net | Note 3 – Intangibles, net Intangibles, net consists of the following (in thousands): September 30, December 31, 2022 2021 Indefinite-lived intangible assets Kona Grill trade name $ 17,400 $ — Finite-lived intangible assets Kona Grill trade name — 17,400 Other finite-lived intangible assets 66 66 Total finite-lived intangible assets 66 17,466 Less: accumulated amortization (2,183) (1,961) Total intangibles, net $ 15,283 $ 15,505 Finite-lived intangible assets are amortized using the straight-line method over their estimated useful life of 10 years. Amortization expense was nominal and $0.3 million for the three months ended September 30, 2022 and 2021, respectively. Amortization expense was $0.2 million and $0.7 million for the nine months ended September 30, 2022 and 2021, respectively. The Company’s estimated aggregate amortization expense for each of the five succeeding fiscal years is a nominal amount annually. Refer to Note 1 regarding the change in accounting estimate of the Kona Grill trade name. |
Accrued Expenses
Accrued Expenses | 9 Months Ended |
Sep. 30, 2022 | |
Accrued Expenses | |
Accrued Expenses | Note 4 – Accrued Expenses Accrued expenses consist of the following (in thousands): September 30, December 31, 2022 2021 Payroll and related (1) $ 4,059 $ 6,554 VAT and sales taxes 2,443 3,477 Construction on new restaurants 2,125 359 Amounts due to landlords 2,072 1,847 Insurance 789 642 Legal, professional and other services 687 458 Income taxes and related 155 — Interest 146 132 Accrued lease exit costs (2) — 4,913 Other (3) 5,137 4,773 Total $ 17,613 $ 23,155 (1) Payroll and related includes $1.2 million in employer payroll taxes for which payment has been deferred under the CARES Act as of September 30, 2022 and December 31, 2021, respectively. (2) Amount relates to lease exit costs for 2016 leases for restaurants never built. All amounts have been paid as of September 30, 2022. (3) Amount primarily relates to recurring restaurant operating expenses. |
Long-Term Debt
Long-Term Debt | 9 Months Ended |
Sep. 30, 2022 | |
Long-Term Debt. | |
Long-Term Debt | Note 5 – Long-Term Debt Long-term debt consists of the following (in thousands): September 30, December 31, 2022 2021 Term loan agreements $ 24,375 $ 24,750 Revolving credit facility 5,000 — Total long-term debt 29,375 24,750 Less: current portion of long-term debt (500) (500) Less: debt issuance costs (935) (1,118) Total long-term debt, net of current portion $ 27,940 $ 23,132 Interest expense for the Company’s debt arrangements, excluding the amortization of debt issuance costs and fees, was $0.4 million and $0.7 million for the three months ended September 30, 2022 and 2021, respectively, and $1.1 million and $2.9 million for the nine months ended September 30, 2022 and 2021, respectively. Capitalized interest was $0.1 million and $0.2 million for the three and nine months ended September 30, 2022, respectively. As of September 30, 2022, the Company had $1.4 million in standby letters of credit outstanding for certain restaurants and $5.6 million available in its revolving credit facility, subject to certain conditions. Credit and Guaranty Agreement On October 4, 2019, in conjunction with the acquisition of Kona Grill, the Company entered into a credit agreement with Goldman Sachs Bank USA (the “Credit Agreement”). On August 6, 2021, the Company entered into the Third Amendment to the Credit Agreement to extend the maturity date for both the term loan and revolving credit facility to August 2026. The Credit Agreement provides for a secured revolving credit facility of $12.0 million and a $25.0 million term loan (reduced from $48.0 million). The term loan is payable in quarterly installments of $0.1 million, with the final payment due in August 2026. The amended Credit Agreement has several borrowing and interest rate options, including the following: (a) a LIBOR rate (or a comparable successor rate) subject to a 1.00% floor or (b) a base rate equal to the greatest of (i) the prime rate, (ii) the federal funds rate plus 0.50%, (iii) the LIBOR rate for a one-month period plus 1.00% or (iv) 4.00%. Loans under the amended Credit Agreement bear interest at a rate per annum using the applicable indices plus an interest rate margin of 5.00% (for LIBOR rate loans) and 4.00% (for base rate loans). Upon the cessation of LIBOR, the amended Credit Agreement provides for the use of a benchmark replacement as defined in the amended Credit Agreement. In conjunction with the amended Credit Agreement, the Company made a pre-payment on the loan of $22.2 million and incurred $0.9 million in debt issuance costs. The Company accounted for the amendment as a debt modification with a partial extinguishment and recognized a loss on early debt extinguishment of $0.6 million for the nine months ended September 30, 2021 and $0.1 million in transaction costs. The Company’s weighted average interest rate on the borrowings under the amended Credit Agreement as of September 30, 2022 and December 31, 2021 was 6.6% and 6.0%, respectively. The Credit Agreement contains customary representations, warranties and conditions to borrowing including customary affirmative and negative covenants, which include covenants that limit or restrict the Company’s ability to incur indebtedness and other obligations, grant liens to secure obligations, make investments, merge or consolidate, alter the organizational structure of the Company and its subsidiaries, and dispose of assets outside the ordinary course of business, in each case subject to customary exceptions for credit facilities of this size and type. The Company and certain operating subsidiaries of the Company guarantee the obligations under the amended Credit Agreement, which also are secured by liens on substantially all of the assets of the Company and its subsidiaries. As of September 30, 2022, the Company had $0.9 million of debt issuance costs related to the amended Credit Agreement, which were capitalized and are recorded as a direct deduction to long-term debt and $0.5 million in debt issuance costs recorded in Other Assets on the condensed consolidated balance sheets. As of September 30, 2022, the Company was in compliance with the financial covenants required by the Credit Agreement. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 9 Months Ended |
Sep. 30, 2022 | |
Fair Value of Financial Instruments | |
Fair Value of Financial Instruments | Note 6 – Fair Value of Financial Instruments Cash and cash equivalents, accounts receivable, inventory, accounts payable and accrued expenses are carried at cost, which approximates fair value. Long-lived assets are measured and disclosed at fair value on a nonrecurring basis if an impairment is identified. There were no long-lived assets measured at fair value as of September 30, 2022. The Company’s long-term debt, including the current portion, is carried at cost on the condensed consolidated balance sheets. Fair value of long-term debt, including the current portion, is valued using Level 2 inputs including current applicable rates for similar instruments and approximates the carrying value of such obligations. |
Income taxes
Income taxes | 9 Months Ended |
Sep. 30, 2022 | |
Income taxes | |
Income taxes | Note 7 – Income taxes Income taxes for the three and nine months ended September 30, 2022 are recorded at the Company’s estimated annual effective income tax rate, subject to adjustments for discrete events, should they occur. The Company’s effective income tax rate including discrete events was (573.2%) and 8.0% for the three and nine months ended September 30, 2022, compared to 11.3% and 7.7% for the three and nine months ended September 30, 2021. The negative rate for the three months ended September 30, 2022 was primarily the result of credits and discrete events exceeding pre-tax book income for the quarter. The Company’s annualized effective tax rate is estimated at approximately 15.9% for 2022. The Company’s projected annual effective tax rate differs from the statutory U.S. tax rate of 21% primarily due to the following: (i) tax credits for FICA taxes on certain employees’ tips (ii) taxes owed in foreign jurisdictions with tax rates that differ from the U.S. statutory rate; (iii) taxes owed in state and local jurisdictions; and (iv) the tax effect of non-deductible compensation. Income tax provision recorded for the nine months ended September 30, 2022 and 2021 included the discrete period tax benefits resulting from the vesting of restricted stock units. The CARES Act includes provisions allowing for the carryback of net operating losses generated for specific periods and technical amendments regarding the expensing of qualified improvement property. The CARES Act also allows for the deferral of the employer-paid portion of social security taxes, which the Company has elected to defer and will pay by December 31, 2022. The Company is subject to U.S. federal, state, local and various foreign income taxes for the jurisdictions in which it operates. Tax regulations within each jurisdiction are subject to the interpretation of the related tax laws and regulations and require significant judgment to apply. In the normal course of business, the Company is subject to examination by federal, state, local and foreign taxing authorities. There are no ongoing federal, state, local, or foreign tax examinations as of September 30, 2022. |
Revenue from Contracts with Cus
Revenue from Contracts with Customers | 9 Months Ended |
Sep. 30, 2022 | |
Revenue from Contracts with Customers | |
Revenue from Contracts with Customers | Note 8 – Revenue from Contracts with Customers The following table provides information about liabilities from contracts with customers, which include deferred license revenue, deferred gift card revenue, the Konavore rewards program and deposits from customers for future events (in thousands): September 30, December 31, 2022 2021 Deferred license revenue (1) $ 317 $ 388 Deferred gift card and gift certificate revenue (2) $ 832 $ 1,769 Advanced party deposits (2) $ 594 $ 260 Konavore rewards program (3) $ 160 $ 136 (1) Includes the current and long-term portion of deferred license revenue. (2) Deferred gift card revenue and advance party deposits on goods and services yet to be provided are included in deferred gift card revenue and other on the condensed consolidated balance sheets. (3) Konavore rewards program is included in accrued expenses on the condensed consolidated balance sheets. Revenue recognized during the period from contract liabilities as of the preceding fiscal year end date is as follows (in thousands): September 30, September 30, 2022 2021 Revenue recognized from deferred license revenue $ 60 $ 134 Revenue recognized from deferred gift card revenue $ 1,126 $ 1,232 Revenue recognized from advanced party deposits $ 243 $ 60 The estimated deferred license revenue to be recognized in the future related to performance obligations that are unsatisfied as of September 30, 2022 were as follows for each year ending (in thousands): 2022, three months remaining $ 19 2023 79 2024 45 2025 44 2026 37 Thereafter 93 Total future estimated deferred license revenue $ 317 |
Leases
Leases | 9 Months Ended |
Sep. 30, 2022 | |
Leases | |
Leases | Note 9 – Leases The components of lease expense for the nine months ended September 30, 2022 and 2021 are as follows (in thousands): September 30, September 30, 2022 2021 Lease cost Operating lease cost $ 10,999 $ 10,099 Variable lease cost 7,707 4,275 Short-term lease cost 650 458 Total lease cost $ 19,356 $ 14,832 Weighted average remaining lease term – operating leases 13 years 13 years Weighted average discount rate – operating leases 8.37 % 8.49 % Due to the negative effects of COVID-19, the Company implemented measures to reduce its costs, including negotiations with landlords regarding rent concessions. As the rent concessions received do not result in a significant increase in cash payments, the Company elected to account for these concessions as a variable lease payment in accordance with ASC Topic 842. The Company’s right-of-use assets and operating lease liabilities have not been remeasured for lease concessions received. Variable lease cost is comprised of percentage rent and common area maintenance, offset by rent concessions received as a result of COVID-19. The Company has entered into two operating leases for future STK restaurants in Charlotte, North Carolina and Los Angeles, California that have not commenced as of September 30, 2022. The present value of the aggregate future commitment related to these leases, net of tenant improvement allowances received from the landlord, is estimated to be $3.5 million. The Company expects these leases, which have an initial lease term of 10 years and one or two 5-year options, to commence within the next twelve months. Supplemental cash flow information related to leases for the period was as follows (in thousands): September 30, September 30, 2022 2021 Cash paid for amounts included in the measurement of operating lease liabilities $ 9,896 $ 9,211 Right-of-use assets obtained in exchange for operating lease obligations $ 3,709 $ 5,369 As of September 30, 2022, maturities of the Company’s operating lease liabilities are as follows (in thousands): 2022, three months remaining $ 3,118 2023 13,664 2024 14,663 2025 13,705 2026 13,636 Thereafter 131,925 Total lease payments 190,711 Less: imputed interest (79,559) Present value of operating lease liabilities $ 111,152 |
Earnings Per Share
Earnings Per Share | 9 Months Ended |
Sep. 30, 2022 | |
Earnings Per Share | |
Earnings Per Share | Note 10 – Earnings Per Share Basic earnings per share is computed using the weighted average number of common shares outstanding during the period and income available to common stockholders. Diluted earnings per share is computed using the weighted average number of common shares outstanding during the period plus the dilutive effect of potential shares of common stock including common stock issuable pursuant to stock options, warrants, and restricted stock units. For the three and nine months ended September 30, 2022 and 2021, the net income per share was calculated as follows (in thousands, except net income per share and related share data): Three months ended September 30, Nine months ended September 30, 2022 2021 2022 2021 Net income attributable to The One Group Hospitality, Inc. $ 482 $ 11,671 $ 8,455 $ 25,577 Basic weighted average shares outstanding 32,663,549 31,993,557 32,496,780 30,830,521 Dilutive effect of stock options, warrants and restricted share units 1,257,949 2,387,016 1,565,881 3,393,336 Diluted weighted average shares outstanding 33,921,498 34,380,573 34,062,661 34,223,857 Net income available to common stockholders per share - Basic $ 0.01 $ 0.36 $ 0.26 $ 0.83 Net income available to common stockholders per share - Diluted $ 0.01 $ 0.34 $ 0.25 $ 0.75 For the three and nine months ended September 30, 2022 and 2021, a nominal amount of stock options, warrants and restricted share units were determined to be anti-dilutive and were therefore excluded from the calculation of diluted earnings per share. |
Stockholder's Equity
Stockholder's Equity | 9 Months Ended |
Sep. 30, 2022 | |
Stockholder's Equity. | |
Stockholder's Equity | Note 11 – Stockholder’s Equity Preferred Stock The Company is authorized to issue 10,000,000 shares of preferred stock with a par value of $0.0001. There were no shares of preferred stock that were issued or outstanding at September 30, 2022 or December 31, 2021. Common Stock Stock Purchase Program |
Stock-Based Compensation and Wa
Stock-Based Compensation and Warrants | 9 Months Ended |
Sep. 30, 2022 | |
Stock-Based Compensation and Warrants | |
Stock-Based Compensation and Warrants | Note 12 – Stock-Based Compensation and Warrants At the 2022 Annual Meeting of Shareholders, the Company’s shareholders approved a 4,500,000 increase in the number of shares available for issuance under the 2019 Equity Plan. As of September 30, 2022, the Company had 3,758,795 shares available for issuance under the 2019 Equity Incentive Plan (“2019 Equity Plan”). Stock-based compensation cost for the three months ended September 30, 2022 and 2021 was $1.0 million and $0.7 million, respectively, and $2.8 million and $2.8 million for the nine months ended September 30, 2022 and 2021, respectively. Stock-based compensation is included in general and administrative expenses in the condensed consolidated statements of operations and comprehensive income. Included in stock-based compensation cost was $0.1 million and $0.2 million of stock granted to directors for the three and nine months ended September 30, 2022 and $0.2 million and $0.4 million for the three and nine months ended September 30, 2021, respectively. Such grants were awarded consistent with the Board of Director’s compensation practices. Stock-based compensation expense for the nine months ended September 30, 2022 and 2021 included $0.1 million and $0.3 million, respectively, of compensation costs for market condition-based options and RSUs. Stock Option Activity Stock options in the table below include both time based and market condition-based awards. Changes in stock options during the nine months ended September 30, 2022 were as follows: Weighted Weighted average Intrinsic average exercise remaining value Shares price contractual life (thousands) Outstanding at December 31, 2021 1,252,352 $ 3.36 3.92 years $ 11,581 Exercisable at December 31, 2021 1,126,685 $ 3.48 3.72 years $ 10,283 Granted — $ — Exercised (13,261) $ 2.13 Cancelled, expired or forfeited — $ — Outstanding at September 30, 2022 1,239,091 $ 3.38 3.15 years $ 4,044 Exercisable at September 30, 2022 1,239,091 $ 3.38 3.15 years $ 4,044 A summary of the status of the Company’s non-vested stock options as of September 30, 2022 and changes during the nine months then ended, is presented below: Weighted average Shares grant date fair value Non-vested stock options at December 31, 2021 125,667 $ 1.00 Vested (125,667) 1.00 Non-vested stock options at September 30, 2022 — $ — The fair value of options that vested in the nine months ended September 30, 2022 was $0.1 million. All outstanding stock options vested as of June 30, 2022. Restricted Stock Unit Activity The Company issues restricted stock units (“RSUs”) under the 2019 Equity Plan. RSUs in the table below include both time based and market condition-based awards. The fair value of time-based RSUs is determined based upon the closing fair market value of the Company’s common stock on the grant date. Awards granted during the third quarter of 2022 included 500,000 RSUs with both a market condition and time element (“Barrier RSUs”). These Barrier RSUs may be earned based on achieving common stock price targets within a 48-month will vest and be settled based on a time element as outlined in the RSU agreement governing the Barrier RSUs. To value the Barrier RSUs, the Company, with the assistance of a third-party specialist, calculated the fair value of Barrier RSUs using the Monte Carlo Simulation, a risk-free rate of 3.31%, a starting common stock value of $6.95, volatility of 73%, and a standard normal distribution. The Company valued the Barrier RSUs at $3.1 million and will amortize that amount evenly over 48 months. For the three and nine months ended September 30, 2022, the Company recorded $0.1 million of stock-based compensation expense associated with these awards. A summary of the status of RSUs and changes during the nine months ended September 30, 2022 is presented below: Weighted average Shares grant date fair value Non-vested RSUs at December 31, 2021 1,690,010 $ 4.98 Granted 953,147 7.46 Vested (715,781) 3.82 Cancelled, expired or forfeited (79,987) 5.99 Non-vested RSUs at September 30, 2022 1,847,389 $ 6.66 As of September 30, 2022, the Company had approximately $10.9 million of total unrecognized compensation costs related to both time based and market condition based RSUs, which will be recognized over a weighted average period of 2.9 years. Warrants As of September 30, 2022 and December 31, 2021, there were outstanding warrants to purchase 125,000 shares of common stock at an exercise price of $1.63. |
Segment Reporting
Segment Reporting | 9 Months Ended |
Sep. 30, 2022 | |
Segment Reporting | |
Segment Reporting | Note 13 – Segment Reporting The Company has identified its reportable operating segments as follows: ● STK . The STK segment consists of the results of operations from STK restaurant locations, competing in the full-service dining industry, as well as management, license and incentive fee revenue generated from the STK brand and pre-opening expenses associated with new restaurants under development. ● Kona Grill . The Kona Grill segment includes the results of operations of Kona Grill restaurant locations and pre-opening expenses associated with new restaurants under development. ● ONE Hospitality . The ONE Hospitality segment is composed of the management, license and incentive fee revenue and results of operations generated from the Company’s other brands and venue concepts, which include ANGEL, Bao Yum Heliot, Hideout, Marconi, Radio, and Rivershore Bar & Grill. Additionally, this segment includes the results of operations generated from F&B hospitality management agreements with hotels, casinos and other high-end locations. ● Corporate . The Corporate segment consists of the following: general and administrative costs, stock-based compensation, lease termination expenses, transaction costs, COVID-19 related expenses and other income and expenses. This segment also includes STK Meat Market, an e-commerce platform that offers signature steak cuts nationwide, the Company’s major off-site events group, which supports all brands and venue concepts, and revenue generated from gift card programs. The Corporate segment’s total assets primarily include cash and cash equivalents, the Kona Grill tradename, and deferred tax assets. The Company’s Chief Executive Officer, who is the Company’s Chief Operating Decision Maker (“CODM”), manages the business and allocates resources via a combination of restaurant sales reports and operating segment profit information, defined as revenues less operating expenses, related to the Company’s four operating segments. In the second quarter of 2022, the Company changed its financial information regularly reviewed by the CODM to include all cash and cash equivalents, the Kona Grill tradename and deferred tax assets in the Corporate segment. Previously, certain cash amounts were included in the STK and Kona Grill segments and the Kona Grill tradename and certain deferred tax assets were included in the Kona Grill segment. Fiscal 2021 figures have been reclassified for comparability. Certain financial information relating to the three and nine months ended September 30, 2022 and 2021 for each segment is provided below (in thousands). STK Kona Grill ONE Hospitality Corporate Total For the three months ended September 30, 2022 Total revenues $ 42,347 30,069 483 121 73,020 Operating income (loss) $ 6,448 259 216 (6,432) 491 Capital asset additions $ 5,788 2,761 58 611 9,218 For the nine months ended September 30, 2022 Total revenues $ 131,865 94,756 1,340 365 228,326 Operating income (loss) $ 28,379 5,094 377 (23,404) 10,446 Capital asset additions $ 13,122 6,029 111 2,047 21,309 As of September 30, 2022 Total assets $ 103,555 73,414 5,344 54,070 236,383 STK Kona Grill ONE Hospitality Corporate Total For the three months ended September 30, 2021 Total revenues $ 40,018 31,177 578 96 71,869 Operating income (loss) $ 9,996 2,258 369 (7,565) 5,058 Capital asset additions $ 1,890 665 29 155 2,739 For the nine months ended September 30, 2021 Total revenues $ 102,495 89,001 991 624 193,111 Operating income (loss) $ 26,403 9,124 185 (22,041) 13,671 Capital asset additions $ 5,115 1,570 102 1,325 8,112 As of December 31, 2021 Total assets $ 95,579 69,006 5,735 59,515 229,835 |
Geographic Information
Geographic Information | 9 Months Ended |
Sep. 30, 2022 | |
Geographic Information | |
Geographic Information | Note 14 – Geographic Information Certain financial information by geographic location is provided below (in thousands). For the three months ended September 30, For the nine months ended September 30, 2022 2021 2022 2021 Domestic revenues $ 71,860 $ 70,192 $ 224,596 $ 190,390 International revenues 1,160 1,677 3,730 2,721 Total revenues $ 73,020 $ 71,869 $ 228,326 $ 193,111 September 30, December 31, 2022 2021 Domestic long-lived assets $ 201,458 $ 185,718 International long-lived assets 1,356 1,190 Total long-lived assets $ 202,814 $ 186,908 |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2022 | |
Commitments and Contingencies. | |
Commitments and Contingencies | Note 15 – Commitments and Contingencies The Company is party to claims in lawsuits incidental to its business, including lease disputes and employee-related matters. The Company has recorded accruals in its consolidated financial statements in accordance with ASC 450, Contingencies. While the resolution of a lawsuit, proceeding or claim may have an impact on the Company’s financial results for the period in which it is resolved, in the opinion of management, the ultimate outcome of such matters and judgements in which the Company is currently involved, either individually or in the aggregate, will not have a material adverse effect on the Company’s consolidated financial position, results of operations or cash flows. |
Summary of Business and Signi_2
Summary of Business and Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2022 | |
Summary of Significant Accounting Policies | |
COVID-19 | COVID-19 In response to COVID-19, the Company has taken significant steps to adapt its business to increase sales while providing a safe environment for guests and employees. COVID-19 related expenses were zero and $2.5 million for the three and nine months ended September 30, 2022, compared to $1.1 million and $3.8 million for the three and nine months ended September 30, 2021, respectively, composed primarily of sanitation, supplies and safety precautions taken to prevent the spread of COVID-19. |
Basis of Presentation | Basis of Presentation The accompanying condensed consolidated balance sheet as of December 31, 2021, which has been derived from audited financial statements, and the accompanying unaudited interim condensed consolidated financial statements (“condensed consolidated financial statements”) of the Company have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) and in accordance with accounting principles generally accepted in the United States (“GAAP”). Certain information and footnote disclosures normally included in annual audited financial statements have been omitted pursuant to SEC rules and regulations. These unaudited interim condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021. In the Company’s opinion, the accompanying unaudited interim financial statements reflect all adjustments (consisting only of normal recurring accruals and adjustments) necessary for a fair presentation of the results for the interim periods presented. The results of operations for any interim period are not necessarily indicative of the results expected for the full year. Additionally, the Company believes that the disclosures are sufficient for interim financial reporting purposes. |
Change in Accounting Estimate | Change in Accounting Estimate Effective April 1, 2022, the Company changed its estimated useful life of the Kona Grill trade name. Based upon the strong performance of the Kona Grill restaurants over the twelve months ended March 31, 2022, significant capital investments in both existing and new restaurants and the Company’s commitment to expand the Kona Grill brand with the opening of new restaurants, the Company has determined that the Kona Grill trade name has an indefinite life rather than the twenty-year life previously determined. The Company currently has two Kona Grill venues under construction in Riverton, Utah and Columbus, Ohio and plans to open three to five Kona Grills each year for the foreseeable future. The effect of this change in estimate will reduce depreciation and amortization expense by $0.9 million annually, increase net income by $0.9 million annually, and increase basic and diluted As a result of the above change, the Company updated its accounting policy for Intangible Assets and will test for impairment annually on November 1 st |
Prior Period Reclassifications | Prior Period Reclassifications Certain reclassifications of the 2021 amounts in the segment reporting footnote have been made to conform to the current year presentation. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In June 2016, the Financial Accounting Standards Board (“FASB “) issued Accounting Standards Update (“ASU“) 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. This update requires companies to measure credit losses utilizing a methodology that reflects expected credit losses and requires a consideration of a broader range of reasonable and supportable information to estimate credit losses. ASU 2016-13 is effective for smaller reporting companies for fiscal years beginning after December 15, 2022. The Company does not expect the adoption of ASU 2016-13 to have a material impact on its financial statements. |
Property and Equipment, net (Ta
Property and Equipment, net (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Property and Equipment, net | |
Schedule of property and equipment, net | Property and equipment, net consist of the following (in thousands): September 30, December 31, 2022 2021 Furniture, fixtures and equipment $ 28,580 $ 24,942 Leasehold improvements 81,489 76,500 Less: accumulated depreciation (45,244) (39,425) Subtotal 64,825 62,017 Construction in progress 18,074 5,374 Restaurant smallwares 2,567 2,247 Total $ 85,466 $ 69,638 |
Intangibles, net (Tables)
Intangibles, net (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Intangibles, net | |
Schedule of intangibles, net | Intangibles, net consists of the following (in thousands): September 30, December 31, 2022 2021 Indefinite-lived intangible assets Kona Grill trade name $ 17,400 $ — Finite-lived intangible assets Kona Grill trade name — 17,400 Other finite-lived intangible assets 66 66 Total finite-lived intangible assets 66 17,466 Less: accumulated amortization (2,183) (1,961) Total intangibles, net $ 15,283 $ 15,505 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Accrued Expenses | |
Schedule of accrued expenses | Accrued expenses consist of the following (in thousands): September 30, December 31, 2022 2021 Payroll and related (1) $ 4,059 $ 6,554 VAT and sales taxes 2,443 3,477 Construction on new restaurants 2,125 359 Amounts due to landlords 2,072 1,847 Insurance 789 642 Legal, professional and other services 687 458 Income taxes and related 155 — Interest 146 132 Accrued lease exit costs (2) — 4,913 Other (3) 5,137 4,773 Total $ 17,613 $ 23,155 (1) Payroll and related includes $1.2 million in employer payroll taxes for which payment has been deferred under the CARES Act as of September 30, 2022 and December 31, 2021, respectively. (2) Amount relates to lease exit costs for 2016 leases for restaurants never built. All amounts have been paid as of September 30, 2022. (3) Amount primarily relates to recurring restaurant operating expenses. |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Long-Term Debt. | |
Schedule of long-term debt | Long-term debt consists of the following (in thousands): September 30, December 31, 2022 2021 Term loan agreements $ 24,375 $ 24,750 Revolving credit facility 5,000 — Total long-term debt 29,375 24,750 Less: current portion of long-term debt (500) (500) Less: debt issuance costs (935) (1,118) Total long-term debt, net of current portion $ 27,940 $ 23,132 |
Revenue from Contracts with C_2
Revenue from Contracts with Customers (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Revenue from Contracts with Customers | |
Schedule of contract liabilities | The following table provides information about liabilities from contracts with customers, which include deferred license revenue, deferred gift card revenue, the Konavore rewards program and deposits from customers for future events (in thousands): September 30, December 31, 2022 2021 Deferred license revenue (1) $ 317 $ 388 Deferred gift card and gift certificate revenue (2) $ 832 $ 1,769 Advanced party deposits (2) $ 594 $ 260 Konavore rewards program (3) $ 160 $ 136 (1) Includes the current and long-term portion of deferred license revenue. (2) Deferred gift card revenue and advance party deposits on goods and services yet to be provided are included in deferred gift card revenue and other on the condensed consolidated balance sheets. (3) Konavore rewards program is included in accrued expenses on the condensed consolidated balance sheets. |
Revenue recognized during the period from contract liabilities | Revenue recognized during the period from contract liabilities as of the preceding fiscal year end date is as follows (in thousands): September 30, September 30, 2022 2021 Revenue recognized from deferred license revenue $ 60 $ 134 Revenue recognized from deferred gift card revenue $ 1,126 $ 1,232 Revenue recognized from advanced party deposits $ 243 $ 60 |
Schedule of estimated deferred license revenue to be recognized in the future related to performance obligations | The estimated deferred license revenue to be recognized in the future related to performance obligations that are unsatisfied as of September 30, 2022 were as follows for each year ending (in thousands): 2022, three months remaining $ 19 2023 79 2024 45 2025 44 2026 37 Thereafter 93 Total future estimated deferred license revenue $ 317 |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Leases | |
Schedule of components of lease expense | The components of lease expense for the nine months ended September 30, 2022 and 2021 are as follows (in thousands): September 30, September 30, 2022 2021 Lease cost Operating lease cost $ 10,999 $ 10,099 Variable lease cost 7,707 4,275 Short-term lease cost 650 458 Total lease cost $ 19,356 $ 14,832 Weighted average remaining lease term – operating leases 13 years 13 years Weighted average discount rate – operating leases 8.37 % 8.49 % |
Schedule of supplemental cash flow information related to leases | Supplemental cash flow information related to leases for the period was as follows (in thousands): September 30, September 30, 2022 2021 Cash paid for amounts included in the measurement of operating lease liabilities $ 9,896 $ 9,211 Right-of-use assets obtained in exchange for operating lease obligations $ 3,709 $ 5,369 |
Schedule of maturities of operating lease liabilities | As of September 30, 2022, maturities of the Company’s operating lease liabilities are as follows (in thousands): 2022, three months remaining $ 3,118 2023 13,664 2024 14,663 2025 13,705 2026 13,636 Thereafter 131,925 Total lease payments 190,711 Less: imputed interest (79,559) Present value of operating lease liabilities $ 111,152 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Earnings Per Share | |
Schedule of earnings per share, basic and diluted | For the three and nine months ended September 30, 2022 and 2021, the net income per share was calculated as follows (in thousands, except net income per share and related share data): Three months ended September 30, Nine months ended September 30, 2022 2021 2022 2021 Net income attributable to The One Group Hospitality, Inc. $ 482 $ 11,671 $ 8,455 $ 25,577 Basic weighted average shares outstanding 32,663,549 31,993,557 32,496,780 30,830,521 Dilutive effect of stock options, warrants and restricted share units 1,257,949 2,387,016 1,565,881 3,393,336 Diluted weighted average shares outstanding 33,921,498 34,380,573 34,062,661 34,223,857 Net income available to common stockholders per share - Basic $ 0.01 $ 0.36 $ 0.26 $ 0.83 Net income available to common stockholders per share - Diluted $ 0.01 $ 0.34 $ 0.25 $ 0.75 |
Stock-Based Compensation and _2
Stock-Based Compensation and Warrants (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Stock-Based Compensation and Warrants | |
Schedule of stock option activity | Weighted Weighted average Intrinsic average exercise remaining value Shares price contractual life (thousands) Outstanding at December 31, 2021 1,252,352 $ 3.36 3.92 years $ 11,581 Exercisable at December 31, 2021 1,126,685 $ 3.48 3.72 years $ 10,283 Granted — $ — Exercised (13,261) $ 2.13 Cancelled, expired or forfeited — $ — Outstanding at September 30, 2022 1,239,091 $ 3.38 3.15 years $ 4,044 Exercisable at September 30, 2022 1,239,091 $ 3.38 3.15 years $ 4,044 |
Schedule of non-vested stock options | Weighted average Shares grant date fair value Non-vested stock options at December 31, 2021 125,667 $ 1.00 Vested (125,667) 1.00 Non-vested stock options at September 30, 2022 — $ — |
Schedule of restricted stock awards and changes | Weighted average Shares grant date fair value Non-vested RSUs at December 31, 2021 1,690,010 $ 4.98 Granted 953,147 7.46 Vested (715,781) 3.82 Cancelled, expired or forfeited (79,987) 5.99 Non-vested RSUs at September 30, 2022 1,847,389 $ 6.66 |
Segment Reporting (Tables)
Segment Reporting (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Segment Reporting | |
Schedule of segment information | Certain financial information relating to the three and nine months ended September 30, 2022 and 2021 for each segment is provided below (in thousands). STK Kona Grill ONE Hospitality Corporate Total For the three months ended September 30, 2022 Total revenues $ 42,347 30,069 483 121 73,020 Operating income (loss) $ 6,448 259 216 (6,432) 491 Capital asset additions $ 5,788 2,761 58 611 9,218 For the nine months ended September 30, 2022 Total revenues $ 131,865 94,756 1,340 365 228,326 Operating income (loss) $ 28,379 5,094 377 (23,404) 10,446 Capital asset additions $ 13,122 6,029 111 2,047 21,309 As of September 30, 2022 Total assets $ 103,555 73,414 5,344 54,070 236,383 STK Kona Grill ONE Hospitality Corporate Total For the three months ended September 30, 2021 Total revenues $ 40,018 31,177 578 96 71,869 Operating income (loss) $ 9,996 2,258 369 (7,565) 5,058 Capital asset additions $ 1,890 665 29 155 2,739 For the nine months ended September 30, 2021 Total revenues $ 102,495 89,001 991 624 193,111 Operating income (loss) $ 26,403 9,124 185 (22,041) 13,671 Capital asset additions $ 5,115 1,570 102 1,325 8,112 As of December 31, 2021 Total assets $ 95,579 69,006 5,735 59,515 229,835 |
Geographic Information (Tables)
Geographic Information (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Geographic Information | |
Schedule of revenues by geographic location | Certain financial information by geographic location is provided below (in thousands). For the three months ended September 30, For the nine months ended September 30, 2022 2021 2022 2021 Domestic revenues $ 71,860 $ 70,192 $ 224,596 $ 190,390 International revenues 1,160 1,677 3,730 2,721 Total revenues $ 73,020 $ 71,869 $ 228,326 $ 193,111 |
Schedule of long-lived assets by geographic location | September 30, December 31, 2022 2021 Domestic long-lived assets $ 201,458 $ 185,718 International long-lived assets 1,356 1,190 Total long-lived assets $ 202,814 $ 186,908 |
Summary of Business and Signi_3
Summary of Business and Significant Accounting Policies (Details) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 USD ($) item restaurant $ / shares | Sep. 30, 2021 USD ($) $ / shares | Sep. 30, 2022 USD ($) item restaurant $ / shares | Sep. 30, 2021 USD ($) $ / shares | |
Number of venues | restaurant | 61 | 61 | ||
Number of hotels provided F&B services | item | 7 | 7 | ||
COVID-19 related expenses | $ 0 | $ 1,131 | $ 2,534 | $ 3,776 |
Number of restaurants under construction | two | |||
Depreciation and amortization | (2,930) | (2,572) | $ (8,571) | (7,766) |
Net income | $ 377 | $ 12,101 | $ 8,338 | $ 26,150 |
Basic net income per share | $ / shares | $ 0.01 | $ 0.36 | $ 0.26 | $ 0.83 |
Diluted net income per share | $ / shares | $ 0.01 | $ 0.34 | $ 0.25 | $ 0.75 |
Intangible Assets, Amortization Period | Kona Grill Trade Name | ||||
Depreciation and amortization | $ 900 | |||
Net income | $ 900 | |||
Basic net income per share | $ / shares | $ 0.03 | |||
Diluted net income per share | $ / shares | $ 0.03 | |||
Intangible Assets, Amortization Period | Kona Grill Trade Name | Minimum | ||||
Number of restaurants planned to be opened in future | three | |||
Intangible Assets, Amortization Period | Kona Grill Trade Name | Maximum | ||||
Number of restaurants planned to be opened in future | five | |||
STK | ||||
Number of venues | restaurant | 23 | 23 | ||
Kona Grill | ||||
Number of venues | restaurant | 24 | 24 | ||
F&B Venues | ||||
Number of venues | restaurant | 14 | 14 |
Property and Equipment, net - T
Property and Equipment, net - Total PPE (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Property, Plant and Equipment [Line Items] | ||
Less: accumulated depreciation and amortization | $ (45,244) | $ (39,425) |
Property and equipment, net | 85,466 | 69,638 |
Furniture, fixtures and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 28,580 | 24,942 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 81,489 | 76,500 |
Total amount net of accumulated depreciation and amortization | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, net | 64,825 | 62,017 |
Construction in progress | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, net | 18,074 | 5,374 |
Restaurant smallwares | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, net | $ 2,567 | $ 2,247 |
Property and Equipment, net - N
Property and Equipment, net - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Property and Equipment, net | ||||
Depreciation | $ 2.9 | $ 2.3 | $ 8.3 | $ 7.1 |
Intangibles, net (Details)
Intangibles, net (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Indefinite-lived intangible assets | ||
Kona Grill trade name | $ 17,400 | |
Finite-lived intangible assets | ||
Kona Grill trade name | $ 17,400 | |
Other finite-lived intangible assets | 66 | 66 |
Total finite-lived intangible assets | 66 | 17,466 |
Less: accumulated amortization | (2,183) | (1,961) |
Total intangibles, net | $ 15,283 | $ 15,505 |
Intangibles, net - Narrative (D
Intangibles, net - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Finite-Lived Intangible Assets [Line Items] | ||||
Amortization expense | $ 0.3 | $ 0.3 | $ 0.2 | $ 0.7 |
Maximum | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Useful life | 10 years |
Accrued Expenses (Details)
Accrued Expenses (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Accrued Expenses | ||
Payroll and related | $ 4,059 | $ 6,554 |
VAT and sales taxes | 2,443 | 3,477 |
Construction on new restaurants | 2,125 | 359 |
Amounts due to landlords | 2,072 | 1,847 |
Insurance | 789 | 642 |
Legal, professional and other services | 687 | 458 |
Income taxes and related | 155 | |
Interest | 146 | 132 |
Accrued lease exit costs | 4,913 | |
Other | 5,137 | 4,773 |
Total | 17,613 | 23,155 |
Employer payroll taxes, deferred | $ 1,200 | $ 1,200 |
Long-Term Debt - Debt and Matur
Long-Term Debt - Debt and Maturities (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 | Aug. 06, 2021 |
Debt Instrument [Line Items] | |||
Long-term debt | $ 29,375 | $ 24,750 | |
Less: current portion of long-term debt | (500) | (500) | |
Less: debt issuance costs | (935) | (1,118) | $ (900) |
Long-term debt, net of current portion | 27,940 | 23,132 | |
Revolving Credit Facility | |||
Debt Instrument [Line Items] | |||
Long-term debt | 5,000 | ||
Medium-term Notes | Term Loan Agreements | |||
Debt Instrument [Line Items] | |||
Long-term debt | $ 24,375 | $ 24,750 |
Long-Term Debt - Narrative (Det
Long-Term Debt - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||
Aug. 06, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | Aug. 05, 2021 | |
Debt Instrument [Line Items] | |||||||
Interest expense | $ 400 | $ 700 | $ 1,100 | $ 2,900 | |||
Weighted average interest rate | 6.60% | 6.60% | 6% | ||||
Standby letters of credit outstanding | $ 1,400 | $ 1,400 | |||||
Debt issuance costs | $ 900 | 935 | 935 | $ 1,118 | |||
CARES Act loan forgiveness | (18,529) | ||||||
Debt interest rate | 4% | ||||||
Transaction costs | 100 | ||||||
Prepayment of outstanding balances | $ 22,200 | ||||||
Interest costs capitalized | 100 | 200 | |||||
Loss on early debt extinguishment | $ 600 | $ 600 | $ 600 | ||||
Other Assets | |||||||
Debt Instrument [Line Items] | |||||||
Debt issuance costs | 500 | 500 | |||||
LIBOR | |||||||
Debt Instrument [Line Items] | |||||||
Basis spread on variable rate | 5% | ||||||
Base Rate | |||||||
Debt Instrument [Line Items] | |||||||
Basis spread on variable rate | 4% | ||||||
One Month LIBOR | |||||||
Debt Instrument [Line Items] | |||||||
Basis spread on derivative rate | 1% | ||||||
LIBOR Floor | |||||||
Debt Instrument [Line Items] | |||||||
Basis spread on variable rate | 1% | ||||||
Fed Funds Effective Rate Overnight Index Swap Rate [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Basis spread on variable rate | 0.50% | ||||||
Goldman Sachs Credit Agreement | |||||||
Debt Instrument [Line Items] | |||||||
Debt issuance costs | 900 | 900 | |||||
Revolving Credit Facility | |||||||
Debt Instrument [Line Items] | |||||||
Available amount | $ 5,600 | $ 5,600 | |||||
Secured revolving credit facility | $ 12,000 | ||||||
Term Loans | |||||||
Debt Instrument [Line Items] | |||||||
Face value of debt | 25,000 | $ 48,000 | |||||
Principal payments | $ 100 |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Details) | Sep. 30, 2022 USD ($) |
Fair Value of Financial Instruments | |
Long-lived assets measured at fair value | $ 0 |
Income taxes - Narrative (Detai
Income taxes - Narrative (Details) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2022 | |
Income taxes | |||||
Effective income tax rate | (573.20%) | 11.30% | 8% | 7.70% | 15.90% |
Foreign rate differential | 21% |
Revenue from Contracts with C_3
Revenue from Contracts with Customers - Contract Liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Deferred license revenue | ||
Deferred revenue | $ 317 | $ 388 |
Deferred gift card and gift certificate revenue | ||
Deferred revenue | 832 | 1,769 |
Advanced party deposits | ||
Deferred revenue | 594 | 260 |
Konavore rewards program | ||
Deferred revenue | $ 160 | $ 136 |
Revenue from Contracts with C_4
Revenue from Contracts with Customers - Changes in Deferred Gift Card and Gift Certificate Revenue (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Deferred license revenue | ||
Revenue recognized | $ 60 | $ 134 |
Deferred gift card and gift certificate revenue | ||
Revenue recognized | 1,126 | 1,232 |
Advanced party deposits | ||
Revenue recognized | $ 243 | $ 60 |
Revenue from Contracts with C_5
Revenue from Contracts with Customers - Future Estimated Deferred License Revenue (Details) - Deferred license revenue $ in Thousands | Sep. 30, 2022 USD ($) |
2022, three months remaining | $ 19 |
2023 | 79 |
2024 | 45 |
2025 | 44 |
2026 | 37 |
Thereafter | 93 |
Total future estimated deferred license revenue | $ 317 |
Leases - Lease Expense (Details
Leases - Lease Expense (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Lease cost | ||
Operating lease cost | $ 10,999 | $ 10,099 |
Variable lease cost | 7,707 | 4,275 |
Short-term lease cost | 650 | 458 |
Total lease cost | $ 19,356 | $ 14,832 |
Weighted average remaining lease term - operating leases | 13 years | 13 years |
Weighted average discount rate - operating leases | 8.37% | 8.49% |
Leases - Effects of COVID-19 (D
Leases - Effects of COVID-19 (Details) $ in Millions | 9 Months Ended |
Sep. 30, 2022 USD ($) Option lease | |
Lessor, Lease, Description [Line Items] | |
Number of operating leases | lease | 2 |
Net of tenant improvement | $ | $ 3.5 |
Initial lease term | 10 years |
Options term | 5 years |
Minimum | |
Lessor, Lease, Description [Line Items] | |
Number of options | 1 |
Maximum | |
Lessor, Lease, Description [Line Items] | |
Number of options | 2 |
Leases - Supplemental Cash Flow
Leases - Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Leases | ||
Cash paid for amounts included in the measurement of operating lease liabilities | $ 9,896 | $ 9,211 |
Right-of-use assets obtained in exchange for operating lease obligations | $ 3,709 | $ 5,369 |
Leases - Operating Lease Liabil
Leases - Operating Lease Liabilities (Details) $ in Thousands | Sep. 30, 2022 USD ($) |
Operating Lease Liabilities, Payments Due [Abstract] | |
2022, three months remaining | $ 3,118 |
2023 | 13,664 |
2024 | 14,663 |
2025 | 13,705 |
2026 | 13,636 |
Thereafter | 131,925 |
Total lease payments | 190,711 |
Less: imputed interest | (79,559) |
Present value of operating lease liabilities | $ 111,152 |
Earnings Per Share - Calculatio
Earnings Per Share - Calculation (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Earnings Per Share | ||||
Net income attributable to The One Group Hospitality, Inc. | $ 482 | $ 11,671 | $ 8,455 | $ 25,577 |
Basic weighted average shares outstanding | 32,663,549 | 31,993,557 | 32,496,780 | 30,830,521 |
Dilutive effect of stock options, warrants and restricted share units | 1,257,949 | 2,387,016 | 1,565,881 | 3,393,336 |
Diluted weighted average shares outstanding | 33,921,498 | 34,380,573 | 34,062,661 | 34,223,857 |
Net income available to common stockholders per share - Basic | $ 0.01 | $ 0.36 | $ 0.26 | $ 0.83 |
Net income available to common stockholders per share - Diluted | $ 0.01 | $ 0.34 | $ 0.25 | $ 0.75 |
Stockholder's Equity (Details)
Stockholder's Equity (Details) - USD ($) $ / shares in Units, $ in Millions | 9 Months Ended | |
Sep. 30, 2022 | Dec. 31, 2021 | |
Equity, Class of Treasury Stock [Line Items] | ||
Preferred Stock, Shares Authorized | 10,000,000 | 10,000,000 |
Preferred stock, par value per share (in dollars per share) | $ 0.0001 | $ 0.0001 |
Preferred Stock, Shares Issued | 0 | 0 |
Preferred Stock, Shares Outstanding | 0 | 0 |
Shares repurchased | 500,000 | |
Amount of shares repurchased | $ 3.5 | |
Maximum | ||
Equity, Class of Treasury Stock [Line Items] | ||
Shares authorized | $ 10 |
Stock-Based Compensation and _3
Stock-Based Compensation and Warrants - Summary of Status of Company's Stock Option Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2022 | Dec. 31, 2021 | |
Shares | ||
Outstanding at the beginning (in shares) | 1,252,352 | |
Exercisable (in shares) | 1,126,685 | |
Exercised (in shares) | (13,261) | |
Outstanding at the ending (in shares) | 1,239,091 | 1,252,352 |
Exercisable (in shares) | 1,239,091 | 1,126,685 |
Weighted average exercise price | ||
Outstanding at the beginning (in dollars per share) | $ 3.36 | |
Exercisable (in dollars per share) | 3.48 | |
Exercised (in dollars per share) | 2.13 | |
Outstanding at the ending (in dollars per share) | 3.38 | $ 3.36 |
Exercisable (in dollars per share) | $ 3.38 | $ 3.48 |
Weighted average remaining contractual life (Years) | ||
Weighted average remaining contractual life | 3 years 1 month 24 days | 3 years 11 months 1 day |
Exercisable weighted average remaining contractual life | 3 years 1 month 24 days | 3 years 8 months 19 days |
Intrinsic value | ||
Intrinsic value, Outstanding | $ 4,044 | $ 11,581 |
Intrinsic value, Exercisable | $ 4,044 | $ 10,283 |
Stock-Based Compensation and _4
Stock-Based Compensation and Warrants - Summary of Non-Vested Stock Options (Details) | 9 Months Ended |
Sep. 30, 2022 $ / shares shares | |
Shares | |
Non-vested stock options (in shares) | shares | 125,667 |
Vested (in shares) | shares | (125,667) |
Weighted average grant date fair value | |
Non-vested stock options (in dollars per share) | $ / shares | $ 1 |
Vested (in dollars per share) | $ / shares | $ 1 |
Stock-Based Compensation and _5
Stock-Based Compensation and Warrants - Summary of Status of Company's Restricted Stock Option Activity (Details) | 9 Months Ended |
Sep. 30, 2022 $ / shares shares | |
Shares | |
Non-vested RSUs at beginning of period (in shares) | shares | 1,690,010 |
Granted (in shares) | shares | 953,147 |
Vested (in shares) | shares | (715,781) |
Cancelled, expired or forfeited (in shares) | shares | (79,987) |
Non-vested RSUs at ending of period (in shares) | shares | 1,847,389 |
Weighted Average Grant Date Fair Value | |
Non-vested RSUs at beginning of period (in dollars per share) | $ / shares | $ 4.98 |
Granted (in dollars per share) | $ / shares | 7.46 |
Vested (in dollars per share) | $ / shares | 3.82 |
Cancelled, expired or forfeited (in dollars per share) | $ / shares | 5.99 |
Non-vested RSUs at ending of period (in dollars per share) | $ / shares | $ 6.66 |
Stock-Based Compensation and _6
Stock-Based Compensation and Warrants - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Stock-based compensation | $ 2,791 | $ 2,442 | |||
Warrants available | 125,000 | 125,000 | 125,000 | ||
Warrants minimum exercise price | $ 1.63 | $ 1.63 | |||
Granted (in shares) | 953,147 | ||||
Stock-based compensation | $ 1,001 | $ 653 | $ 2,791 | 2,812 | |
Maximum | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Fair value of options vested | 100 | ||||
General and Administrative Expense. | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Stock-based compensation | 1,000 | 700 | 2,800 | 2,800 | |
Restricted Stock | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Unrecognized compensation cost related to non-vested awards | $ 10,900 | $ 10,900 | |||
Unrecognized compensation cost, recognition period | 2 years 10 months 24 days | ||||
Barrier RSUs | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Granted (in shares) | 500,000 | ||||
Contractual term | 48 months | ||||
Risk-free interest rate | 3.31% | ||||
Common stock value | $ 6.95 | $ 6.95 | |||
Volatility | 73% | ||||
Fair value of RSU | $ 3,100 | ||||
Stock-based compensation | $ 100 | $ 100 | |||
Milestone-Based Options | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Stock-based compensation | $ 100 | 300 | |||
Equity Incentive Plan 2019 | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Shares available for issuance | 3,758,795 | 3,758,795 | |||
Increase in authorized shares (in shares) | 4,500,000 | ||||
Director | Restricted Stock | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Stock-based compensation | $ 100 | $ 200 | $ 200 | $ 400 |
Segment Reporting (Details)
Segment Reporting (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 USD ($) | Sep. 30, 2021 USD ($) | Sep. 30, 2022 USD ($) segment | Sep. 30, 2021 USD ($) | Dec. 31, 2021 USD ($) | |
Segment Reporting Information [Line Items] | |||||
Number of reportable segments | segment | 4 | ||||
Total revenues | $ 73,020 | $ 71,869 | $ 228,326 | $ 193,111 | |
Operating income (loss) | 491 | 5,058 | 10,446 | 13,671 | |
Capital asset additions | 9,218 | 2,739 | 21,309 | 8,112 | |
Total assets | 236,383 | 236,383 | $ 229,835 | ||
STK | |||||
Segment Reporting Information [Line Items] | |||||
Total revenues | 42,347 | 40,018 | 131,865 | 102,495 | |
Operating income (loss) | 6,448 | 9,996 | 28,379 | 26,403 | |
Capital asset additions | 5,788 | 1,890 | 13,122 | 5,115 | |
Total assets | 103,555 | 103,555 | 95,579 | ||
Kona Grill | |||||
Segment Reporting Information [Line Items] | |||||
Total revenues | 30,069 | 31,177 | 94,756 | 89,001 | |
Operating income (loss) | 259 | 2,258 | 5,094 | 9,124 | |
Capital asset additions | 2,761 | 665 | 6,029 | 1,570 | |
Total assets | 73,414 | 73,414 | 69,006 | ||
ONE Hospitality | |||||
Segment Reporting Information [Line Items] | |||||
Total revenues | 483 | 578 | 1,340 | 991 | |
Operating income (loss) | 216 | 369 | 377 | 185 | |
Capital asset additions | 58 | 29 | 111 | 102 | |
Total assets | 5,344 | 5,344 | 5,735 | ||
Corporate | |||||
Segment Reporting Information [Line Items] | |||||
Total revenues | 121 | 96 | 365 | 624 | |
Operating income (loss) | (6,432) | (7,565) | (23,404) | (22,041) | |
Capital asset additions | 611 | $ 155 | 2,047 | $ 1,325 | |
Total assets | $ 54,070 | $ 54,070 | $ 59,515 |
Geographic Information (Details
Geographic Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||
Revenues | $ 73,020 | $ 71,869 | $ 228,326 | $ 193,111 | |
Long-lived assets | 202,814 | 202,814 | $ 186,908 | ||
Domestic | |||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||
Revenues | 71,860 | 70,192 | 224,596 | 190,390 | |
Long-lived assets | 201,458 | 201,458 | 185,718 | ||
International | |||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||
Revenues | 1,160 | $ 1,677 | 3,730 | $ 2,721 | |
Long-lived assets | $ 1,356 | $ 1,356 | $ 1,190 |