The ONE Group Hospitality, Inc. (STKS) 10-Q3 Aug 232023 Q2 Quarterly reportFinancial data

Company Profile

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
Document and Entity Information - shares	Jun. 30, 2023	Jul. 31, 2023
Document and Entity Information [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Transition Report	false
Document Period End Date	Jun. 30, 2023
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q2
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		31,622,234
Entity Central Index Key	0001399520
Amendment Flag	false

CONDENSED CONSOLIDATED BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Current assets:
Cash and cash equivalents	$ 38,178	$ 55,121
Accounts receivable	9,486	15,220
Inventory	5,765	5,728
Other current assets	2,344	2,091
Due from related parties	376	376
Total current assets	56,149	78,536
Property and equipment, net	111,509	94,087
Operating lease right-of-use assets	88,538	85,161
Deferred tax assets, net	12,311	12,323
Intangibles, net	15,312	15,290
Other assets	4,738	4,774
Security deposits	850	853
Total assets	289,407	291,024
Current liabilities:
Accounts payable	11,767	13,055
Accrued expenses	18,277	22,409
Deferred gift card revenue and other	1,274	2,115
Current portion of operating lease liabilities	6,444	6,336
Current portion of long-term debt	1,000	1,500
Other current liabilities	253	256
Total current liabilities	39,015	45,671
Operating lease liabilities, net of current portion	110,251	105,247
Long-term debt, net of current portion	71,102	70,544
Other long-term liabilities	896	972
Total liabilities	221,264	222,434
Commitments and contingencies (Note 15)
Stockholders' equity:
Common stock, $0.0001 par value, 75,000,000 shares authorized; 33,311,371 issued and 31,622,234 outstanding at June 30, 2023 and 32,829,995 issued and 31,735,423 outstanding at December 31, 2022	3	3
Preferred stock, $0.0001 par value, 10,000,000 shares authorized; no shares issued and outstanding at June 30, 2023 and December 31, 2022, respectively
Treasury stock, 1,691,649 and 1,094,572 shares at cost at June 30, 2023 and December 31, 2022, respectively	(11,322)	(7,169)
Additional paid-in capital	56,561	55,583
Retained earnings	27,340	24,166
Accumulated other comprehensive loss	(2,887)	(2,869)
Total stockholders' equity	69,695	69,714
Noncontrolling interests	(1,552)	(1,124)
Total equity	68,143	68,590
Total liabilities and equity	$ 289,407	$ 291,024

CONDENSED CONSOLIDATED BALANC_2

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Jun. 30, 2023	Dec. 31, 2022
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	33,311,371	32,829,995
Common stock, shares outstanding	31,622,234	31,735,423
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	1,691,649	1,094,572

CONDENSED CONSOLIDATED STATEMEN

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Revenues:
Owned restaurant net revenue	$ 79,923	$ 76,930	$ 158,502	$ 147,446
Management, license and incentive fee revenue	3,470	4,195	7,447	7,860
Total revenues	83,393	81,125	165,949	155,306
Owned operating expenses:
Owned restaurant cost of sales	19,215	19,851	38,070	37,950
Owned restaurant operating expenses	48,784	44,309	95,611	83,682
Total owned operating expenses	67,999	64,160	133,681	121,632
General and administrative (including stock-based compensation of $1,234, $911, $2,554, $1,790 for the three and six months ended June 30, 2023 and 2022, respectively)	8,039	7,261	15,523	14,140
Depreciation and amortization	3,506	2,926	7,162	5,641
Pre-opening expenses	1,609	804	2,908	1,149
COVID-19 related expenses		221		2,534
Lease termination expenses				255
Other expenses	195		352
Total costs and expenses	81,348	75,372	159,626	145,351
Operating income	2,045	5,753	6,323	9,955
Other expenses, net:
Interest expense, net of interest income	1,642	444	3,429	952
Total other expenses, net	1,642	444	3,429	952
Income before provision for income taxes	403	5,309	2,894	9,003
(Benefit) provision for income taxes	(13)	869	148	1,042
Net income	416	4,440	2,746	7,961
Less: net (loss) income attributable to noncontrolling interest	(152)	137	(428)	(12)
Net income attributable to The ONE Group Hospitality, Inc.	568	4,303	3,174	7,973
Currency translation gain (loss)	52	(169)	(18)	(261)
Comprehensive income attributable to The ONE Group Hospitality, Inc.	$ 620	$ 4,134	$ 3,156	$ 7,712
Net income attributable to The ONE Group Hospitality, Inc. per share:
Basic net income per share	$ 0.02	$ 0.13	$ 0.10	$ 0.25
Diluted net income per share	$ 0.02	$ 0.13	$ 0.10	$ 0.23
Shares used in computing basic income per share	31,782,783	32,601,203	31,730,299	32,411,570
Shares used in computing diluted income per share	32,673,457	33,959,991	32,779,821	34,123,142

CONDENSED CONSOLIDATED STATEM_2

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (Parenthetical) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
Stock-based compensation	$ 1,234	$ 911	$ 2,554	$ 1,790

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	Noncontrolling interests	Stockholders' equity	Total
Balance at Dec. 31, 2021	$ 3	$ (37)	$ 53,481	$ 10,632	$ (2,645)	$ (909)	$ 61,434	$ 60,525
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		(149)	3,670	3,521
Balance at Mar. 31, 2022	$ 3	(37)	54,046	14,302	(2,737)	(1,058)	65,577	64,519
Balance (in shares) at Mar. 31, 2022	32,260,337
Balance at Dec. 31, 2021	$ 3	(37)	53,481	10,632	(2,645)	(909)	61,434	60,525
Balance (in shares) at Dec. 31, 2021	32,125,762
Net income (Loss)								7,961
Balance at Jun. 30, 2022	$ 3	(37)	53,743	18,605	(2,906)	(921)	69,408	68,487
Balance (in shares) at Jun. 30, 2022	32,649,401
Balance at Mar. 31, 2022	$ 3	(37)	54,046	14,302	(2,737)	(1,058)	65,577	64,519
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			28				28	28
Exercise of stock options (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		137	4,303	4,440
Balance at Jun. 30, 2022	$ 3	(37)	53,743	18,605	(2,906)	(921)	69,408	68,487
Balance (in shares) at Jun. 30, 2022	32,649,401
Balance at Dec. 31, 2022	$ 3	(7,169)	55,583	24,166	(2,869)	(1,124)	69,714	68,590
Balance (in shares) at Dec. 31, 2022	31,735,423
Stock-based compensation			1,320				1,320	1,320
Stock-based compensation, (in shares)	16,205
Issuance of vested restricted shares, net of tax withholding			(1,432)				(1,432)	(1,432)
Issuance of vested restricted shares, net of tax withholding (in shares)	247,536
Purchase of treasury stock		(735)					(735)	(735)
Purchase of treasury stock (in shares)	(118,085)
Gain (Loss) on foreign currency translation, net					(70)		(70)	(70)
Net income (Loss)				2,606		(276)	2,606	2,330
Balance at Mar. 31, 2023	$ 3	(7,904)	55,471	26,772	(2,939)	(1,400)	71,403	70,003
Balance (in shares) at Mar. 31, 2023	31,881,079
Balance at Dec. 31, 2022	$ 3	(7,169)	55,583	24,166	(2,869)	(1,124)	69,714	68,590
Balance (in shares) at Dec. 31, 2022	31,735,423
Net income (Loss)								2,746
Balance at Jun. 30, 2023	$ 3	(11,322)	56,561	27,340	(2,887)	(1,552)	69,695	68,143
Balance (in shares) at Jun. 30, 2023	31,622,234
Balance at Mar. 31, 2023	$ 3	(7,904)	55,471	26,772	(2,939)	(1,400)	71,403	70,003
Balance (in shares) at Mar. 31, 2023	31,881,079
Stock-based compensation			1,234				1,234	1,234
Stock-based compensation, (in shares)	17,930
Exercise of stock options			226				226	226
Exercise of stock options (in shares)	135,500
Issuance of vested restricted shares, net of tax withholding			(370)				(370)	(370)
Issuance of vested restricted shares, net of tax withholding (in shares)	66,717
Purchase of treasury stock		(3,418)					(3,418)	(3,418)
Purchase of treasury stock (in shares)	(478,992)
Gain (Loss) on foreign currency translation, net					52		52	52
Net income (Loss)				568		(152)	568	416
Balance at Jun. 30, 2023	$ 3	$ (11,322)	$ 56,561	$ 27,340	$ (2,887)	$ (1,552)	$ 69,695	$ 68,143
Balance (in shares) at Jun. 30, 2023	31,622,234

CONDENSED CONSOLIDATED STATEM_4

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Operating activities:
Net income	$ 2,746	$ 7,961
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	7,162	5,641
Stock-based compensation	2,554	1,790
Amortization of debt issuance costs	372	186
Deferred taxes	12	586
Changes in operating assets and liabilities:
Accounts receivable	5,722	3,436
Inventory	(37)	(817)
Other current assets	(253)	1,379
Security deposits	3	61
Other assets	(257)	(329)
Accounts payable	(922)	273
Accrued expenses	(4,943)	(5,154)
Operating lease liabilities and right-of-use assets	1,735	464
Other liabilities	(758)	(535)
Net cash provided by operating activities	13,136	14,942
Investing activities:
Purchase of property and equipment	(23,896)	(12,091)
Net cash used in investing activities	(23,896)	(12,091)
Financing activities:
Repayments of long-term debt and financing lease liabilities	(435)	(250)
Exercise of stock options and warrants	226	28
Tax-withholding obligation on stock-based compensation	(1,802)	(1,556)
Purchase of treasury stock	(4,153)
Net cash used in financing activities	(6,164)	(1,778)
Effect of exchange rate changes on cash	(19)	(270)
Net (decrease) increase in cash and cash equivalents	(16,943)	803
Cash and cash equivalents, beginning of period	55,121	23,614
Cash and cash equivalents, end of period	38,178	24,417
Supplemental disclosure of cash flow data:
Interest paid, net of capitalized interest	4,055	874
Income taxes paid	312	287
Accrued purchases of property and equipment	$ 5,602	$ 2,415

Summary of Business and Signifi

Summary of Business and Significant Accounting Policies	6 Months Ended
Summary of Business and Significant Accounting Policies	Jun. 30, 2023
Summary of Business and 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 an international 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 June 30, 2023, the Company owned, operated, managed, or licensed 63 venues, including 25 STKs and 25 Kona Grills in major metropolitan cities in North America, Europe and the Middle East and 13 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. Basis of Presentation The accompanying condensed consolidated balance sheet as of December 31, 2022, 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, 2022. 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. 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. Effective, January 1, 2023, the Company implemented ASU 2016-13. The implementation did not have a material impact on the Company’s financial statements.

Property and Equipment, Net

Property and Equipment, Net	6 Months Ended
Property and Equipment, Net	Jun. 30, 2023
Property and Equipment, Net
Property and Equipment, Net	Note 2 – Property and Equipment, Net Property and equipment, net consist of the following (in thousands): June 30, December 31, 2023 2022 Furniture, fixtures and equipment $ 37,007 $ 33,372 Leasehold improvements 93,372 89,121 Less: accumulated depreciation (53,244) (47,528) Subtotal 77,135 74,965 Construction in progress 31,383 16,276 Restaurant smallwares 2,991 2,846 Total $ 111,509 $ 94,087 Depreciation related to property and equipment was $3.4 million and $2.9 million for the three months ended June 30, 2023 and 2022, respectively, and $7.0 million and $5.4 million for the six months ended June 30, 2023 and 2022, respectively. The Company depreciates construction in progress upon such assets being placed into service.

Intangibles, Net

Intangibles, Net	6 Months Ended
Intangibles, Net	Jun. 30, 2023
Intangibles, Net
Intangibles, Net	Note 3 – Intangibles, Net Intangibles, net consists of the following (in thousands): June 30, December 31, 2023 2022 Indefinite-lived intangible assets Kona Grill trade name $ 17,400 $ 17,400 Finite-lived intangible assets 101 75 Less: accumulated amortization (2,189) (2,185) Total intangibles, net $ 15,312 $ 15,290 Finite-lived intangible assets are amortized using the straight-line method over their estimated useful life of 10 years. Amortization expense was nominal for both the three months ended June 30, 2023 and 2022. Amortization expense was nominal and $0.2 million for the six months ended June 30, 2023 and 2022, respectively. The Company’s estimated aggregate amortization expense for each of the five succeeding fiscal years is a nominal amount annually.

Accrued Expenses

Accrued Expenses	6 Months Ended
Accrued Expenses	Jun. 30, 2023
Accrued Expenses
Accrued Expenses	Note 4 – Accrued Expenses Accrued expenses consist of the following (in thousands): June 30, December 31, 2023 2022 Payroll and related $ 3,293 $ 5,249 Construction on new restaurants 3,526 1,903 VAT and sales taxes 3,457 4,118 Amounts due to landlords 2,055 2,949 Legal, professional and other services 841 626 Insurance 466 742 Income taxes and related 32 156 Interest 25 268 Other (1) 4,582 6,398 Total $ 18,277 $ 22,409 (1) Amount primarily relates to recurring restaurant operating expenses.

Long-Term Debt

Long-Term Debt	6 Months Ended
Long-Term Debt	Jun. 30, 2023
Long-Term Debt
Long-Term Debt	Note 5 – Long-Term Debt Long-term debt consists of the following (in thousands): June 30, December 31, 2023 2022 Term loan agreements $ 24,000 $ 24,250 Revolving credit facility — — Delayed draw term facility 50,000 50,000 Total long-term debt 74,000 74,250 Less: current portion of long-term debt (1,000) (1,500) Less: debt issuance costs (1,898) (2,206) Total long-term debt, net of current portion $ 71,102 $ 70,544 Interest expense, net for the Company’s debt arrangements, excluding the amortization of debt issuance costs and fees, was $1.8 million and $0.4 million for the three months ended June 30, 2023 and 2022, respectively, and $3.8 million and $0.8 million for the six months ended June 30, 2023 and 2022, respectively. Capitalized interest was $0.4 million and $0.6 million for the three and six months ended June 30, 2023, respectively. Capitalized interest was $0.1 million for the three and six months ended June 30, 2022. As of June 30, 2023, the Company had $1.4 million in standby letters of credit outstanding for certain restaurants and $10.6 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, to eliminate all financial covenants except a maximum net leverage ratio of 2.00 to 1.00, and to eliminate restrictions on the maximum amount of capital expenditures, the maximum number of Company-owned new locations, and credit extensions under the revolving credit facility. As amended, 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. On December 13, 2022, the Company entered into the Fourth Amendment to the Credit Agreement that: ● Allows for a new $50.0 million delayed draw term facility, available to draw for twelve months and subject to a 1.75 x Net Leverage Ratio incurrence test (as defined in the Credit Agreement) for permitted acquisitions, stock repurchases and new restaurant capital expenditures; ● Allows the Company to redeem, repurchase or otherwise acquire its own capital stock in an aggregate amount of up to $50 million subject to a 1.75 x Net Leverage Ratio incurrence test and no default or event of default; ● Changes the interest rate from London Interbank Offered Rate (“LIBOR“) plus a margin to Secured Overnight Financing Rate (“SOFR”) plus an applicable margin; and ● Requires the Company to pay interest on an undrawn portion of the delayed draw term loan up to $35.0 million, beginning 90 days following the effective date until December 13, 2023. The Company borrowed $50.0 million on the delayed draw term facility on December 28, 2022. The delayed draw term loan is payable in quarterly installments of $0.25 million beginning March 31, 2024, with the final payment due in August 2026. Loans under the amended Credit Agreement bear interest at a rate per annum using the SOFR rate subject to a 1.00% floor plus an interest rate margin of 6.50%. The Company’s weighted average interest rate on the borrowings under the amended Credit Agreement as of June 30, 2023 and December 31, 2022 was 11.77% and 10.31%, respectively. The Credit Agreement contains customary representations, warranties and conditions to borrowing including customary affirmative and negative 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 June 30, 2023, the Company had $1.9 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 $0.4 million in debt issuance costs recorded in Other Assets on the condensed consolidated balance sheets. As of June 30, 2023, the Company was in compliance with the financial covenants required by the Credit Agreement.

Fair Value of Financial Instrum

Fair Value of Financial Instruments	6 Months Ended
Fair Value of Financial Instruments	Jun. 30, 2023
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 June 30, 2023. 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	6 Months Ended
Income Taxes	Jun. 30, 2023
Income Taxes
Income Taxes	Note 7 – Income Taxes Income taxes for the three and six months ended June 30, 2023 are recorded at the Company’s estimated annual effective income tax rate, subject to adjustments for discrete events, should they occur. The Company recorded income tax expense of $0.1 million and $1.0 million for the six months ended June 30, 2023 and 2022, respectively. The Company’s effective income tax rate including discrete events was 5.1% for the six months ended June 30, 2023 compared to 11.6% for the six months ended June 30, 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 six months ended June 30, 2023 and 2022 included the discrete period tax benefits resulting from the vesting of restricted stock units. 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 the federal, state, local and foreign taxing authorities. There are no ongoing federal, state, local, or foreign tax examinations as of June 30, 2023.

Revenue from Contracts with Cus

Revenue from Contracts with Customers	6 Months Ended
Revenue from Contracts with Customers	Jun. 30, 2023
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): June 30, December 31, 2023 2022 Deferred license revenue (1) $ 258 $ 297 Deferred gift card and gift certificate revenue (2) $ 908 $ 1,680 Advanced party deposits (2) $ 366 $ 435 Konavore rewards program (3) $ 169 $ 163 (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): June 30, June 30, 2023 2022 Revenue recognized from deferred license revenue $ 40 $ 40 Revenue recognized from deferred gift card revenue $ 917 $ 1,196 Revenue recognized from advanced party deposits $ 278 $ 198 The estimated deferred license revenue to be recognized in the future related to performance obligations that are unsatisfied as of June 30, 2023 were as follows for each year ending (in thousands): 2023, six months remaining $ 39 2024 45 2025 44 2026 37 2027 34 Thereafter 59 Total future estimated deferred license revenue $ 258

Leases

Leases	6 Months Ended
Leases	Jun. 30, 2023
Leases
Leases	Note 9 – Leases The components of lease expense for the six months ended June 30, 2023 and 2022 are as follows (in thousands): June 30, June 30, 2023 2022 Lease cost Operating lease cost $ 7,943 $ 7,317 Finance lease cost Amortization of ROU assets 102 — Interest on lease liabilities 41 — Total finance lease cost 143 — Variable lease cost (1) 5,781 5,597 Short-term lease cost 488 521 Total lease cost $ 14,355 $ 13,435 Weighted average remaining lease term Operating leases 13 years 13 years Finance leases 4.3 years — Weighted average discount rate Operating leases 8.53 % 8.40 % Finance leases 9.00 % — % (1) Variable lease cost is comprised of percentage rent and common area maintenance. Supplemental cash flow information related to leases for the period was as follows (in thousands): June 30, December 31, 2023 2022 Finance lease right-of-use assets (1) $ 884 $ 942 Current portion of finance lease liabilities (1) 191 177 Long-term portion of finance lease liabilities (1) 700 754 (1) Finance lease assets and liabilities are included in other assets, other current liabilities, and other long-term liabilities on the consolidated balance sheet. June 30, June 30, 2023 2022 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 7,090 $ 6,531 Operating cash flows from finance leases $ 102 $ — Financing cash flows from finance leases $ 185 $ — Right-of-use assets obtained in exchange for lease obligations: Operating leases $ 8,034 $ 3,709 Finance leases $ 43 $ — The Company has entered into three operating leases for future restaurants that have not commenced as of June 30, 2023. 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 $6.1 million. The Company expects these leases, which have initial lease terms of 10 years and one or two 5-year As of June 30, 2023, maturities of the Company’s operating lease liabilities are as follows (in thousands): 2023 $ 1,382 2024 15,944 2025 15,490 2026 15,561 2027 15,950 Thereafter 140,918 Total lease payments 205,245 Less: imputed interest (88,550) Present value of operating lease liabilities $ 116,695 As of June 30, 2023, maturities of the Company’s finance lease liabilities are as follows (in thousands): 2023 $ 141 2024 244 2025 244 2026 244 2027 203 Total lease payments 1,076 Less: imputed interest (185) Present value of finance lease liabilities $ 891

Earnings Per Share

Earnings Per Share	6 Months Ended
Earnings Per Share	Jun. 30, 2023
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 six months ended June 30, 2023 and 2022, net income per share was calculated as follows (in thousands, except net income per share and related share data): Three months ended June 30, Six months ended June 30, 2023 2022 2023 2022 Net income attributable to The ONE Group Hospitality, Inc. $ 568 $ 4,303 $ 3,174 $ 7,973 Basic weighted average shares outstanding 31,782,783 32,601,203 31,730,299 32,411,570 Dilutive effect of stock options, warrants and restricted share units 890,674 1,358,788 1,049,522 1,711,572 Diluted weighted average shares outstanding 32,673,457 33,959,991 32,779,821 34,123,142 Net income available to common stockholders per share - Basic $ 0.02 $ 0.13 $ 0.10 $ 0.25 Net income available to common stockholders per share - Diluted $ 0.02 $ 0.13 $ 0.10 $ 0.23 For the three and six months ended June 30, 2023 and 2022, 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	6 Months Ended
Stockholder's Equity	Jun. 30, 2023
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 June 30, 2023 or December 31, 2022. Common Stock Stock Purchase Program In September 2022, the Company’s Board of Directors authorized a repurchase program of up to

Stock-Based Compensation and Wa

Stock-Based Compensation and Warrants	6 Months Ended
Stock-Based Compensation and Warrants	Jun. 30, 2023
Stock-Based Compensation and Warrants
Stock-Based Compensation and Warrants	Note 12 – Stock-Based Compensation and Warrants As of June 30, 2023, the Company had 3,501,668 shares available for issuance under the 2019 Equity Incentive Plan (“2019 Equity Plan). Stock-based compensation cost was $1.2 million and $0.9 million for the three months ended June 30, 2023 and 2022, respectively, and $2.6 million and $1.8 million for the six months ended June 30, 2023 and 2022, 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 $0.3 million of stock granted to directors for the three and six months ended June 30, 2023 and $0.1 million and $0.2 million for the three and six months ended June 30, 2022, respectively. Such grants were awarded consistent with the Board of Director’s compensation practices. Stock-based compensation for the three and six months ended June 30, 2023 included $0.2 million and $0.4 million, respectively, of compensation costs for the vesting of market condition-based restricted stock units (“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 six months ended June 30, 2023 were as follows: Weighted Weighted average Intrinsic average exercise remaining value Shares price contractual life (thousands) Outstanding at December 31, 2022 1,187,352 $ 3.43 2.84 years $ 3,811 Exercisable at December 31, 2022 1,187,352 $ 3.43 2.84 years $ 3,811 Granted — $ — Exercised (10,500) $ 2.13 Cancelled, expired or forfeited — $ — Outstanding at June 30, 2023 1,176,852 $ 3.44 2.33 years $ 4,564 Exercisable at June 30, 2023 1,176,852 $ 3.44 2.33 years $ 4,564 All outstanding stock options vested as of June 30, 2022. Restricted Stock Unit Activity The Company issues restricted stock units 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. RSU awards granted during September 2022 included 500,000 RSUs awarded to our Chief Executive Officer with both a market condition and time element (the “CEO RSUs”). The CEO RSUs may be earned based on achieving common stock price targets within a 48-month A summary of the status of RSUs and changes during the six months ended June 30, 2023 is presented below: Weighted average Shares grant date fair value Non-vested RSUs at December 31, 2022 1,839,432 $ 6.62 Granted 260,386 8.06 Vested (549,726) 4.28 Cancelled, expired or forfeited (68,341) 6.46 Non-vested RSUs at June 30, 2023 1,481,751 $ 7.75 As of June 30, 2023, the Company had approximately $9.1 million of unrecognized compensation costs related to both time-based and market condition-based RSUs, which will be recognized over a weighted average period of 2.5 years. Warrants During the three months ended June 30, 2023, warrants to purchase 125,000 shares of common stock at an exercise price of $1.63 per share were exercised. There were no warrants outstanding as of June 30, 2023.

Segment Reporting

Segment Reporting	6 Months Ended
Segment Reporting	Jun. 30, 2023
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.. Certain financial information relating to the three and six months ended June 30, 2023 and 2022 for each segment is provided below (in thousands). STK Kona Grill ONE Hospitality Corporate Total For the three months ended June 30, 2023 Total revenues $ 48,573 34,277 442 101 83,393 Operating income (loss) $ 8,858 1,379 3 (8,195) 2,045 Capital asset additions (1) $ 6,681 4,937 5 422 12,045 For the six months ended June 30, 2023 Total revenues $ 99,711 65,186 843 209 165,949 Operating income (loss) $ 20,954 1,354 (43) (15,942) 6,323 Capital asset additions (1) $ 10,955 11,415 26 1,500 23,896 As of June 30, 2023 Total assets $ 119,503 87,008 5,375 77,521 289,407 STK Kona Grill ONE Hospitality Corporate Total For the three months ended June 30, 2022 Total revenues $ 47,019 33,475 514 117 81,125 Operating income (loss) $ 11,213 1,798 170 (7,428) 5,753 Capital asset additions $ 5,055 1,465 16 1,105 7,641 For the six months ended June 30, 2022 Total revenues $ 89,518 64,687 857 244 155,306 Operating income (loss) $ 21,931 4,835 161 (16,972) 9,955 Capital asset additions $ 7,334 3,268 53 1,436 12,091 As of December 31, 2022 Total assets $ 113,911 78,691 5,746 92,676 291,024 (1) Capital asset additions for the Corporate segment include furniture, fixtures, and equipment for restaurants that the Company plans to open in the future.

Geographic Information

Geographic Information	6 Months Ended
Geographic Information	Jun. 30, 2023
Geographic Information
Geographic Information	Note 14 – Geographic Information Certain financial information by geographic location is provided below (in thousands). For the three months ended June 30, For the six months ended June 30, 2023 2022 2023 2022 Domestic revenues $ 82,214 $ 79,592 $ 163,673 $ 152,736 International revenues 1,179 1,533 2,276 2,570 Total revenues $ 83,393 $ 81,125 $ 165,949 $ 155,306 June 30, December 31, 2023 2022 Domestic long-lived assets $ 231,818 $ 211,143 International long-lived assets 1,440 1,345 Total long-lived assets $ 233,258 $ 212,488

Commitments and Contingencies

Commitments and Contingencies	6 Months Ended
Commitments and Contingencies	Jun. 30, 2023
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, when necessary, 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)	6 Months Ended
	Jun. 30, 2023
Summary of Business and Significant Accounting Policies
Basis of Presentation	Basis of Presentation The accompanying condensed consolidated balance sheet as of December 31, 2022, 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, 2022. 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.
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. Effective, January 1, 2023, the Company implemented ASU 2016-13. The implementation did not have a material impact on the Company’s financial statements.

Property and Equipment, Net (Ta

Property and Equipment, Net (Tables)	6 Months Ended
Property and Equipment, Net (Tables)	Jun. 30, 2023
Property and Equipment, Net
Schedule of property and equipment, net	Property and equipment, net consist of the following (in thousands): June 30, December 31, 2023 2022 Furniture, fixtures and equipment $ 37,007 $ 33,372 Leasehold improvements 93,372 89,121 Less: accumulated depreciation (53,244) (47,528) Subtotal 77,135 74,965 Construction in progress 31,383 16,276 Restaurant smallwares 2,991 2,846 Total $ 111,509 $ 94,087

Intangibles, Net (Tables)

Intangibles, Net (Tables)	6 Months Ended
Intangibles, Net (Tables)	Jun. 30, 2023
Intangibles, Net
Schedule of intangibles, net	Intangibles, net consists of the following (in thousands): June 30, December 31, 2023 2022 Indefinite-lived intangible assets Kona Grill trade name $ 17,400 $ 17,400 Finite-lived intangible assets 101 75 Less: accumulated amortization (2,189) (2,185) Total intangibles, net $ 15,312 $ 15,290

Accrued Expenses (Tables)

Accrued Expenses (Tables)	6 Months Ended
Accrued Expenses (Tables)	Jun. 30, 2023
Accrued Expenses
Schedule of accrued expenses	Accrued expenses consist of the following (in thousands): June 30, December 31, 2023 2022 Payroll and related $ 3,293 $ 5,249 Construction on new restaurants 3,526 1,903 VAT and sales taxes 3,457 4,118 Amounts due to landlords 2,055 2,949 Legal, professional and other services 841 626 Insurance 466 742 Income taxes and related 32 156 Interest 25 268 Other (1) 4,582 6,398 Total $ 18,277 $ 22,409 (1) Amount primarily relates to recurring restaurant operating expenses.

Long-Term Debt (Tables)

Long-Term Debt (Tables)	6 Months Ended
Long-Term Debt (Tables)	Jun. 30, 2023
Long-Term Debt
Schedule of long-term debt	Long-term debt consists of the following (in thousands): June 30, December 31, 2023 2022 Term loan agreements $ 24,000 $ 24,250 Revolving credit facility — — Delayed draw term facility 50,000 50,000 Total long-term debt 74,000 74,250 Less: current portion of long-term debt (1,000) (1,500) Less: debt issuance costs (1,898) (2,206) Total long-term debt, net of current portion $ 71,102 $ 70,544

Revenue from Contracts with C_2

Revenue from Contracts with Customers (Tables)	6 Months Ended
Revenue from Contracts with Customers (Tables)	Jun. 30, 2023
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): June 30, December 31, 2023 2022 Deferred license revenue (1) $ 258 $ 297 Deferred gift card and gift certificate revenue (2) $ 908 $ 1,680 Advanced party deposits (2) $ 366 $ 435 Konavore rewards program (3) $ 169 $ 163 (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): June 30, June 30, 2023 2022 Revenue recognized from deferred license revenue $ 40 $ 40 Revenue recognized from deferred gift card revenue $ 917 $ 1,196 Revenue recognized from advanced party deposits $ 278 $ 198
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 June 30, 2023 were as follows for each year ending (in thousands): 2023, six months remaining $ 39 2024 45 2025 44 2026 37 2027 34 Thereafter 59 Total future estimated deferred license revenue $ 258

Leases (Tables)

Leases (Tables)	6 Months Ended
Leases (Tables)	Jun. 30, 2023
Leases
Schedule of components of lease expense	The components of lease expense for the six months ended June 30, 2023 and 2022 are as follows (in thousands): June 30, June 30, 2023 2022 Lease cost Operating lease cost $ 7,943 $ 7,317 Finance lease cost Amortization of ROU assets 102 — Interest on lease liabilities 41 — Total finance lease cost 143 — Variable lease cost (1) 5,781 5,597 Short-term lease cost 488 521 Total lease cost $ 14,355 $ 13,435 Weighted average remaining lease term Operating leases 13 years 13 years Finance leases 4.3 years — Weighted average discount rate Operating leases 8.53 % 8.40 % Finance leases 9.00 % — % (1) Variable lease cost is comprised of percentage rent and common area maintenance.
Summary of components of finance lease assets and liabilities on the consolidated balance sheet	Supplemental cash flow information related to leases for the period was as follows (in thousands): June 30, December 31, 2023 2022 Finance lease right-of-use assets (1) $ 884 $ 942 Current portion of finance lease liabilities (1) 191 177 Long-term portion of finance lease liabilities (1) 700 754 (1) Finance lease assets and liabilities are included in other assets, other current liabilities, and other long-term liabilities on the consolidated balance sheet.
Schedule of supplemental cash flow information related to leases	June 30, June 30, 2023 2022 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 7,090 $ 6,531 Operating cash flows from finance leases $ 102 $ — Financing cash flows from finance leases $ 185 $ — Right-of-use assets obtained in exchange for lease obligations: Operating leases $ 8,034 $ 3,709 Finance leases $ 43 $ —
Schedule of maturities of operating lease liabilities	As of June 30, 2023, maturities of the Company’s operating lease liabilities are as follows (in thousands): 2023 $ 1,382 2024 15,944 2025 15,490 2026 15,561 2027 15,950 Thereafter 140,918 Total lease payments 205,245 Less: imputed interest (88,550) Present value of operating lease liabilities $ 116,695
Schedule of maturities of finance lease liabilities	As of June 30, 2023, maturities of the Company’s finance lease liabilities are as follows (in thousands): 2023 $ 141 2024 244 2025 244 2026 244 2027 203 Total lease payments 1,076 Less: imputed interest (185) Present value of finance lease liabilities $ 891

Earnings Per Share (Tables)

Earnings Per Share (Tables)	6 Months Ended
Earnings Per Share (Tables)	Jun. 30, 2023
Earnings Per Share
Schedule of earnings per share, basic and diluted	For the three and six months ended June 30, 2023 and 2022, net income per share was calculated as follows (in thousands, except net income per share and related share data): Three months ended June 30, Six months ended June 30, 2023 2022 2023 2022 Net income attributable to The ONE Group Hospitality, Inc. $ 568 $ 4,303 $ 3,174 $ 7,973 Basic weighted average shares outstanding 31,782,783 32,601,203 31,730,299 32,411,570 Dilutive effect of stock options, warrants and restricted share units 890,674 1,358,788 1,049,522 1,711,572 Diluted weighted average shares outstanding 32,673,457 33,959,991 32,779,821 34,123,142 Net income available to common stockholders per share - Basic $ 0.02 $ 0.13 $ 0.10 $ 0.25 Net income available to common stockholders per share - Diluted $ 0.02 $ 0.13 $ 0.10 $ 0.23

Stock-Based Compensation and _2

Stock-Based Compensation and Warrants (Tables)	6 Months Ended
Stock-Based Compensation and Warrants (Tables)	Jun. 30, 2023
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, 2022 1,187,352 $ 3.43 2.84 years $ 3,811 Exercisable at December 31, 2022 1,187,352 $ 3.43 2.84 years $ 3,811 Granted — $ — Exercised (10,500) $ 2.13 Cancelled, expired or forfeited — $ — Outstanding at June 30, 2023 1,176,852 $ 3.44 2.33 years $ 4,564 Exercisable at June 30, 2023 1,176,852 $ 3.44 2.33 years $ 4,564
Schedule of RSUs and changes	Weighted average Shares grant date fair value Non-vested RSUs at December 31, 2022 1,839,432 $ 6.62 Granted 260,386 8.06 Vested (549,726) 4.28 Cancelled, expired or forfeited (68,341) 6.46 Non-vested RSUs at June 30, 2023 1,481,751 $ 7.75

Segment Reporting (Tables)

Segment Reporting (Tables)	6 Months Ended
Segment Reporting (Tables)	Jun. 30, 2023
Segment Reporting
Schedule of segment information	Certain financial information relating to the three and six months ended June 30, 2023 and 2022 for each segment is provided below (in thousands). STK Kona Grill ONE Hospitality Corporate Total For the three months ended June 30, 2023 Total revenues $ 48,573 34,277 442 101 83,393 Operating income (loss) $ 8,858 1,379 3 (8,195) 2,045 Capital asset additions (1) $ 6,681 4,937 5 422 12,045 For the six months ended June 30, 2023 Total revenues $ 99,711 65,186 843 209 165,949 Operating income (loss) $ 20,954 1,354 (43) (15,942) 6,323 Capital asset additions (1) $ 10,955 11,415 26 1,500 23,896 As of June 30, 2023 Total assets $ 119,503 87,008 5,375 77,521 289,407 STK Kona Grill ONE Hospitality Corporate Total For the three months ended June 30, 2022 Total revenues $ 47,019 33,475 514 117 81,125 Operating income (loss) $ 11,213 1,798 170 (7,428) 5,753 Capital asset additions $ 5,055 1,465 16 1,105 7,641 For the six months ended June 30, 2022 Total revenues $ 89,518 64,687 857 244 155,306 Operating income (loss) $ 21,931 4,835 161 (16,972) 9,955 Capital asset additions $ 7,334 3,268 53 1,436 12,091 As of December 31, 2022 Total assets $ 113,911 78,691 5,746 92,676 291,024 (1) Capital asset additions for the Corporate segment include furniture, fixtures, and equipment for restaurants that the Company plans to open in the future.

Geographic Information (Tables)

Geographic Information (Tables)	6 Months Ended
Geographic Information (Tables)	Jun. 30, 2023
Geographic Information
Schedule of revenues by geographic location	Certain financial information by geographic location is provided below (in thousands). For the three months ended June 30, For the six months ended June 30, 2023 2022 2023 2022 Domestic revenues $ 82,214 $ 79,592 $ 163,673 $ 152,736 International revenues 1,179 1,533 2,276 2,570 Total revenues $ 83,393 $ 81,125 $ 165,949 $ 155,306
Schedule of long-lived assets by geographic location	June 30, December 31, 2023 2022 Domestic long-lived assets $ 231,818 $ 211,143 International long-lived assets 1,440 1,345 Total long-lived assets $ 233,258 $ 212,488

Summary of Business and Signi_3

Summary of Business and Significant Accounting Policies (Details)	Jun. 30, 2023 item restaurant
Number of venues	63
Number of hotels provided F&B services \| item	7
STK
Number of venues	25
Kona Grill
Number of venues	25
F&B Venues
Number of venues	13

Property and Equipment, Net - T

Property and Equipment, Net - Total PPE (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Property, Plant and Equipment [Line Items]
Less: accumulated depreciation	$ (53,244)	$ (47,528)
Total	111,509	94,087
Furniture, fixtures and equipment
Property, Plant and Equipment [Line Items]
Property and equipment, gross	37,007	33,372
Leasehold improvements
Property, Plant and Equipment [Line Items]
Property and equipment, gross	93,372	89,121
Subtotal
Property, Plant and Equipment [Line Items]
Total	77,135	74,965
Construction in progress
Property, Plant and Equipment [Line Items]
Total	31,383	16,276
Restaurant smallwares
Property, Plant and Equipment [Line Items]
Total	$ 2,991	$ 2,846

Property and Equipment, Net - N

Property and Equipment, Net - Narrative (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Property and Equipment, Net
Depreciation	$ 3.4	$ 2.9	$ 7	$ 5.4

Intangibles, Net (Details)

Intangibles, Net (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Indefinite-lived intangible assets
Kona Grill trade name	$ 17,400	$ 17,400
Finite-lived intangible assets	101	75
Less: accumulated amortization	(2,189)	(2,185)
Total intangibles, net	$ 15,312	$ 15,290

Intangibles, Net - Narrative (D

Intangibles, Net - Narrative (Details) - USD ($) $ in Millions	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Intangibles, Net
Useful life	10 years
Amortization expense	$ 0.2	$ 0.2

Accrued Expenses (Details)

Accrued Expenses (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Accrued Expenses
Payroll and related	$ 3,293	$ 5,249
Construction on new restaurants	3,526	1,903
VAT and sales taxes	3,457	4,118
Amounts due to landlords	2,055	2,949
Legal, professional and other services	841	626
Insurance	466	742
Income taxes and related	32	156
Interest	25	268
Other (1)	4,582	6,398
Total	$ 18,277	$ 22,409

Long-Term Debt - Debt (Details)

Long-Term Debt - Debt (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Debt Instrument [Line Items]
Long-term debt	$ 74,000	$ 74,250
Less: current portion of long-term debt	(1,000)	(1,500)
Less: debt issuance costs	(1,898)	(2,206)
Total long-term debt, net of current portion	71,102	70,544
Delayed draw term facility
Debt Instrument [Line Items]
Long-term debt	50,000	50,000
Medium-term Notes \| Term loan agreements
Debt Instrument [Line Items]
Long-term debt	$ 24,000	$ 24,250

Long-Term Debt - Narrative (Det

Long-Term Debt - Narrative (Details) - USD ($) $ in Thousands				3 Months Ended		6 Months Ended
	Dec. 28, 2022	Dec. 13, 2022	Aug. 06, 2021	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022	Dec. 31, 2022	Sep. 30, 2022	Aug. 05, 2021
Debt Instrument [Line Items]
Interest expense				$ 1,800	$ 400	$ 3,800	$ 800
Weighted average interest rate				11.77%		11.77%		10.31%
Standby letters of credit outstanding				$ 1,400		$ 1,400
Debt issuance costs				1,898		1,898		$ 2,206
Debt instrument, floor interest rate	1%
Capitalized interest				400	$ 100	600	$ 100
Other Assets
Debt Instrument [Line Items]
Debt issuance costs				400		400
Maximum
Debt Instrument [Line Items]
Maximum net leverage ratio			2%
Shares authorized									$ 10,000
Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate [Member]
Debt Instrument [Line Items]
Basis spread on variable rate	6.50%
Goldman Sachs Credit Agreement
Debt Instrument [Line Items]
Debt issuance costs				1,900		1,900
Revolving credit facility
Debt Instrument [Line Items]
Available amount				$ 10,600		$ 10,600
Secured revolving credit facility			$ 12,000
Term Loans
Debt Instrument [Line Items]
Face value of debt			25,000							$ 48,000
Principal payments			$ 100
Delayed draw term facility
Debt Instrument [Line Items]
Maximum net leverage ratio		1.75%
Face value of debt		$ 50,000
Principal payments	$ 250
Loan received	$ 50,000
Debt Instrument, delayed draw period		12 months
Debt instrument, period of interest on undrawn portion		90 days
Delayed draw term facility \| Maximum
Debt Instrument [Line Items]
Shares authorized		$ 50,000
Debt instrument, interest on undrawn portion		$ 35,000

Fair Value of Financial Instr_2

Fair Value of Financial Instruments (Details)	Jun. 30, 2023 USD ($)
Fair Value of Financial Instruments
Long-lived assets measured at fair value	$ 0

Income Taxes - Narrative (Detai

Income Taxes - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
Income Taxes - Narrative (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Income Taxes
Income tax expense	$ (13)	$ 869	$ 148	$ 1,042
Effective income tax rate			5.10%	11.60%
Foreign rate differential			21%

Revenue from Contracts with C_3

Revenue from Contracts with Customers - Contract Liabilities (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Deferred license revenue
Deferred revenue	$ 258	$ 297
Deferred gift card and gift certificate revenue
Deferred revenue	908	1,680
Advanced party deposits
Deferred revenue	366	435
Konavore rewards program
Deferred revenue	$ 169	$ 163

Revenue from Contracts with C_4

Revenue from Contracts with Customers - Changes in Deferred Gift Card and Gift Certificate Revenue (Details) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Deferred license revenue
Revenue recognized	$ 40	$ 40
Deferred gift card revenue
Revenue recognized	917	1,196
Advanced party deposits
Revenue recognized	$ 278	$ 198

Revenue from Contracts with C_5

Revenue from Contracts with Customers - Future Estimated Deferred License Revenue (Details) - Deferred license revenue $ in Thousands	Jun. 30, 2023 USD ($)
2023, six months remaining	$ 39
2024	45
2025	44
2026	37
2027	34
Thereafter	59
Total future estimated deferred license revenue	$ 258

Leases - Lease Expense (Details

Leases - Lease Expense (Details) - USD ($) $ in Thousands	6 Months Ended
Leases - Lease Expense (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Jun. 30, 2022
Lease cost
Operating lease cost	$ 7,943	$ 7,317
Amortization of ROU assets	102
Interest on lease liabilities	41
Total finance lease cost	143
Variable lease cost	5,781	5,597
Short-term lease cost	488	521
Total lease cost	$ 14,355	$ 13,435
Weighted average remaining lease term - operating leases	13 years	13 years
Weighted average remaining lease term - finance leases	4 years 3 months 18 days
Weighted average discount rate - operating leases	8.53%	8.40%
Weighted average discount rate - finance leases	9%

Leases - Finance Lease Assets a

Leases - Finance Lease Assets and Liabilities (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Leases
Finance lease right-of-use assets	$ 884	$ 942
Current portion of finance lease liabilities	191	177
Long-term portion of finance lease liabilities	$ 700	$ 754

Leases - Operating Lease - Narr

Leases - Operating Lease - Narrative (Details) $ in Millions	6 Months Ended
	Jun. 30, 2023 USD ($) lease Option
Lessee, Lease, Description [Line Items]
Number of operating leases \| lease	3
Options term	5 years
The amount of lessee's operating lease not yet commenced \| $	$ 6.1
Initial lease term	10 years
Minimum
Lessee, Lease, Description [Line Items]
Number of options	1
Maximum
Lessee, Lease, Description [Line Items]
Number of options	2

Leases - Supplemental Cash Flow

Leases - Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Leases
Operating cash flows from operating leases	$ 7,090	$ 6,531
Operating cash flows from finance leases	102
Financing cash flows from finance leases	185
Operating leases	8,034	$ 3,709
Finance leases	$ 43

Leases - Operating Lease Liabil

Leases - Operating Lease Liabilities (Details) $ in Thousands	Jun. 30, 2023 USD ($)
Operating Lease Liabilities, Payments Due [Abstract]
2023	$ 1,382
2024	15,944
2025	15,490
2026	15,561
2027	15,950
Thereafter	140,918
Total lease payments	205,245
Less: imputed interest	(88,550)
Present value of operating lease liabilities	$ 116,695

Leases - Finance Lease Liabilit

Leases - Finance Lease Liabilities (Details) $ in Thousands	Jun. 30, 2023 USD ($)
Finance Lease, Liability, Payment, Due [Abstract]
2023	$ 141
2024	244
2025	244
2026	244
2027	203
Total lease payments	1,076
Less: imputed interest	(185)
Present value of finance lease liabilities	$ 891

Earnings Per Share - Calculatio

Earnings Per Share - Calculation (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Earnings Per Share
Net income attributable to The ONE Group Hospitality, Inc.	$ 568	$ 4,303	$ 3,174	$ 7,973
Basic weighted average shares outstanding	31,782,783	32,601,203	31,730,299	32,411,570
Dilutive effect of stock options, warrants and restricted share units	890,674	1,358,788	1,049,522	1,711,572
Diluted weighted average shares outstanding	32,673,457	33,959,991	32,779,821	34,123,142
Net income available to common stockholders per share - Basic	$ 0.02	$ 0.13	$ 0.10	$ 0.25
Net income available to common stockholders per share - Diluted	$ 0.02	$ 0.13	$ 0.10	$ 0.23

Stockholder's Equity (Details)

Stockholder's Equity (Details) - USD ($) $ / shares in Units, $ in Millions	1 Months Ended	3 Months Ended	6 Months Ended
	May 31, 2023	Jun. 30, 2023	Jun. 30, 2023	Dec. 31, 2022	Sep. 30, 2022
Equity, Class of Treasury Stock [Line Items]
Preferred stock, shares authorized		10,000,000	10,000,000	10,000,000
Preferred stock, par value per share (in dollars per share)		$ 0.0001	$ 0.0001	$ 0.0001
Preferred stock, shares issued		0	0	0
Preferred stock, shares outstanding		0	0	0
Stock Repurchase Program, Additional Authorized Amount	$ 5
Shares repurchased		500,000	1.7
Amount of shares repurchased		$ 3.4	$ 11.3
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	6 Months Ended	12 Months Ended
	Jun. 30, 2023	Dec. 31, 2022
Shares
Outstanding at the beginning (in shares)	1,187,352
Exercised (in shares)	(10,500)
Outstanding at the ending (in shares)	1,176,852	1,187,352
Exercisable (in shares)	1,176,852	1,187,352
Weighted average exercise price
Outstanding at the beginning (in dollars per share)	$ 3.43
Exercised (in dollars per share)	2.13
Outstanding at the ending (in dollars per share)	3.44	$ 3.43
Exercisable (in dollars per share)	$ 3.44	$ 3.43
Weighted average remaining contractual life (Years)
Weighted average remaining contractual life	2 years 3 months 29 days	2 years 10 months 2 days
Exercisable weighted average remaining contractual life	2 years 3 months 29 days	2 years 10 months 2 days
Intrinsic value
Intrinsic value, Outstanding	$ 4,564	$ 3,811
Intrinsic value, Exercisable	$ 4,564	$ 3,811

Stock-Based Compensation and _4

Stock-Based Compensation and Warrants - Summary of Status of Company's Restricted Stock Option Activity (Details)	6 Months Ended
	Jun. 30, 2023 $ / shares shares
Shares
Non-vested RSUs at beginning of period (in shares) \| shares	1,839,432
Granted (in shares) \| shares	260,386
Vested (in shares) \| shares	(549,726)
Cancelled, expired or forfeited (in shares) \| shares	(68,341)
Non-vested RSUs at ending of period (in shares) \| shares	1,481,751
Weighted Average Grant Date Fair Value
Non-vested RSUs at beginning of period (in dollars per share) \| $ / shares	$ 6.62
Granted (in dollars per share) \| $ / shares	8.06
Vested (in dollars per share) \| $ / shares	4.28
Cancelled, expired or forfeited (in dollars per share) \| $ / shares	6.46
Non-vested RSUs at ending of period (in dollars per share) \| $ / shares	$ 7.75

Stock-Based Compensation and _5

Stock-Based Compensation and Warrants - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands	1 Months Ended	3 Months Ended		6 Months Ended
	Sep. 30, 2022	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation				$ 2,554	$ 1,790
Shares available for purchase		125,000		125,000
Warrants available		0		0
Warrants maximum exercise price		$ 1.63
Granted (in shares)				260,386
Risk-free interest rate	3.31%
Class of Warrant or Right, Outstanding		0		0
General and Administrative Expense.
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation		$ 1,200	$ 900	$ 2,600	1,800
Restricted Stock
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized compensation cost related to non-vested awards		9,100		$ 9,100
Unrecognized compensation cost, recognition period				2 years 6 months
CEO RSUs
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation		200		$ 400
Granted (in shares)	500,000
Contractual term	48 months
Common stock value	$ 6.95
Volatility	73%
Fair value of RSU	$ 2,900
Milestone-Based Options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation		$ 200		$ 400
Equity Incentive Plan 2019
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares available for issuance		3,501,668		3,501,668
Director \| Restricted Stock
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation		$ 100	$ 100	$ 300	$ 200

Segment Reporting (Details)

Segment Reporting (Details) $ in Thousands	3 Months Ended		6 Months Ended
Segment Reporting (Details) $ in Thousands	Jun. 30, 2023 USD ($)	Jun. 30, 2022 USD ($)	Jun. 30, 2023 USD ($) segment	Jun. 30, 2022 USD ($)	Dec. 31, 2022 USD ($)
Segment Reporting Information [Line Items]
Number of reportable segments \| segment			4
Total revenues	$ 83,393	$ 81,125	$ 165,949	$ 155,306
Operating income (loss)	2,045	5,753	6,323	9,955
Capital asset additions	12,045	7,641	23,896	12,091
Total assets	289,407		289,407		$ 291,024
STK
Segment Reporting Information [Line Items]
Total revenues	48,573	47,019	99,711	89,518
Operating income (loss)	8,858	11,213	20,954	21,931
Capital asset additions	6,681	5,055	10,955	7,334
Total assets	119,503		119,503		113,911
Kona Grill
Segment Reporting Information [Line Items]
Total revenues	34,277	33,475	65,186	64,687
Operating income (loss)	1,379	1,798	1,354	4,835
Capital asset additions	4,937	1,465	11,415	3,268
Total assets	87,008		87,008		78,691
ONE Hospitality
Segment Reporting Information [Line Items]
Total revenues	442	514	843	857
Operating income (loss)	3	170	(43)	161
Capital asset additions	5	16	26	53
Total assets	5,375		5,375		5,746
Corporate
Segment Reporting Information [Line Items]
Total revenues	101	117	209	244
Operating income (loss)	(8,195)	(7,428)	(15,942)	(16,972)
Capital asset additions	422	$ 1,105	1,500	$ 1,436
Total assets	$ 77,521		$ 77,521		$ 92,676

Geographic Information (Details

Geographic Information (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
Geographic Information (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022	Dec. 31, 2022
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues	$ 83,393	$ 81,125	$ 165,949	$ 155,306
Long-lived assets	233,258		233,258		$ 212,488
Domestic
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues	82,214	79,592	163,673	152,736
Long-lived assets	231,818		231,818		211,143
International
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues	1,179	$ 1,533	2,276	$ 2,570
Long-lived assets	$ 1,440		$ 1,440		$ 1,345