Q4 2021 FAT Brands Inc Earnings Call
[music].
Good afternoon, ladies and gentlemen, and thank you for standing by welcome to the Fat Brands, Inc. Fourth quarter and fiscal 2021 earnings conference call.
At this time all participants have been placed in a listen only mode. Please note that this conference is being recorded today March 21 2022 on.
On the call today from Fat brands are President and Chief Executive Officer, Andy We don't warrant and she finance financial Officer, Ken Queuing.
By now everyone should have access to the earnings release, which can be found our investor relations website at IR that sat brands Dot com and the press release section before we begin I need to remind everyone that part of our discussion today will include forward looking statements. These forward looking statements are not guarantees of future performance and therefore undue reliance.
It should not be placed upon them.
Results may differ materially from those indicated by these forward looking statements due to a number of risks and uncertainties. The company does not undertake to update these forward looking statements at a later date.
For a more detailed discussion of the risks that could impact future operating results and financial condition. Please see today's earnings press release, and our current SEC filings.
During today's call the company May discuss non-GAAP financial measures, which it believes can be useful in evaluating its performance.
The presentation of this additional information should not be considered in isolation, nor as a substitute for results prepared in accordance with GAAP reconciliations to comparable GAAP measures are available in today's earnings release I would now like to each other conference over to Andy <unk>, President and Chief Executive Officer. Please go ahead.
Thank you operator, good afternoon, everyone and thank you all for joining us on the call Tonight I am hopeful that everyone is continuing to stay safe and healthy as well.
This afternoon, we made our fourth quarter and fiscal 2021 financial results publicly available.
Please refer to the earnings release, and our earnings supplement both of which are available in the investors section of our website at www fat brands.
John .
Each contain additional details about the fourth quarter.
Which closed on December 26th.
I would like to start out today by thanking our team members is 2021 marked an incredible year as we executed on the two pillars of growth strategy, which include acquisitions and organic growth.
Fat brands is truly unique is we have a scalable platform that affords us the opportunity to synergistically incorporates new concepts with minimal incremental corporate overhead cost.
We also have a long runway for organic growth with more than 850, new locations in our pipeline, providing us with a potential 33% unit growth and 50% EBITDA growth over the next few years.
Today, I'm, particularly excited to talk to you about our recent acquisitions and resulting synergies.
M&A and capital market strategy organic growth and continued strong brand performance.
And as you know we have the restaurant brands organized into five different categories, mainly our Qs hard brands, which include Roundtable pizza and facilities will drive through and delivery.
<unk> also includes the snack brands such as marble slab cleanly, great American cookies, pretzel maker and how it's all going to stick.
Then there are our fast casual brands, the Burger brands, such as fabric or Johnny rockets, and elevation Burger plus Buffalo's Express all of the Mediterranean.
Next are our casual dining brands Hurricane grilling wings native grilling wings, Buffalo's cafe, and ponderosa and Bonanza Steakhouses.
Finally, our polished casual dining otherwise known as sports bars category hosting twin peaks sports launches.
The fifth category is our manufacturing business. It came with global franchise group manufacturers Cookie dough and pretzel mix for our brands as well as conducts distribution services or other products used in those same restaurant brands operations.
In the fourth quarter, we were encouraged that our franchise partners and company owned restaurants continued to report improving sales and in many instances sales are equal to or above pre pandemic levels, indicating the strength of our brands are accompanied by a return to normalcy within the industry.
Our strong performance reflects the hard work and dedication of our franchise partners and employees.
While the emergence of Omnicom created modest headwinds late in the fourth quarter I'm pleased to report that our portfolio of brands performed well posting system wide sales growth.
Our legacy Fat brands portfolio of brands owned for all of 2021 like Stockburger, Johnny Rockets Hurricane really wings, etc saw an increase of five 6% over the fourth quarter of 2019, and 12, 4% versus Q4 of 2020.
If we included the acquired brands in that calculation essentially showing how our total portfolio was doing our increase in same store sales over 2019 for Q4 would be eight 5%.
And over 2020 for Q4, it would be 21, 4%.
For the newly acquired brands, we saw outstanding same store sales increases in the fourth quarter of 2021 compared to the fourth quarter of 2019 and 2020 prior year quarter as follows and this will all be posted in our earnings supplement on our website. So you don't need to write this down.
Johnny Rockets saw seven 4% decline over 2000, 1952, and a half per cent increase over 2020.
Global franchise group saw a 10, 6% increase over 2019, and a 16, 1% increase over 2020.
Twin peaks sports lodges saw at 15, 8% increase over 2019.
34% increase over 2020.
So there's all these sort of 25, 6% increase over 2019 and 15, 7% over 2020.
Finally native grilling wings saw 16, 5% over 2019 and 27% over 2020.
Restaurants across the globe continue to reopen we are temporarily closed as a result of COVID-19.
As of the end of the fourth quarter of 2021 'twenty three locations across the system eight domestic and 15 international.
Excluding the recently acquired concepts remained temporarily closed due to COVID-19, compared to 52 units at the end of the third quarter given the progress in reopening we expect to see continued topline revenue improvement in 2022.
We're also very encouraged that despite the reopening of dining rooms delivery sales are showing resilience facilitated by the rollout of although and captain formerly known as hunger both of which are online ordering providers and also Chow eat which is a third party online P. O S system aggregator integrating orders into our P. O S systems across all.
Portfolio.
Turning now to our organic growth strategy I encourage the both new construction and franchise sales are stronger than we've seen in many years, if not ever our franchisees opened 13, new locations in the fourth quarter and a total of 115 locations for the full year 2021.
Our current development pipeline consists of approximately 850 locations and those are committed and have mostly been paid for in full by our franchise partners in other words already sold not to be sold.
Most notably we have a pipeline of more than 470 units between fabric or Johnny rockets, Buffalo's Express and elevation Burger.
Plus 157, new locations for global franchise group, that's Roundtable Pizza, Great American Cookie marble slab ice cream me, perhaps homemaker, and hotdogs and stick.
Also 144 sports lodges for twin peaks and 114 drive through locations for physicians.
We see strong demand from our franchise partners have recently acquired concepts to develop other brands in the fat portfolio and vice versa.
We believe that our organic growth opportunity represents 50 million of potential incremental EBITDA growth and as I previously mentioned, 33% unit growth.
Further our factory today sits at approximately 30% capacity, mainly running one shift a day rather than potentially three and thus has significant white space to grow the manufacturing of additional items for our entire portfolio of brands as well as third party manufacturing.
Equally important to our organic growth strategy is our acquisition strategy, which provides growth for our platform fueled by the identification and addition of new restaurant concepts.
We have developed a robust management assistance platform that supports the expansion of our existing brands, while enabling the accretive acquisition and efficient integration of additional restaurant concepts.
We have a disciplined and selective approach to evaluate potential targets with a focus on franchise brands with a proven track record of long term sustainable and profitable operating performance.
Looking forward, we plan to fund our future acquisitions with a combination of cash on hand.
Proceeds from securitization vehicles, and potentially tapping the equity capital markets.
Also focused on refinancing our debt facilities over the next year lowering our effective cost of capital.
I want to highlight our two most recent acquisitions twin peaks and facilities, which both closed in the fourth quarter.
To date, we are very pleased with the assimilation of both brands and we were already experiencing significant synergies given our existing infrastructure and purchasing power.
As a reminder, on October one 2021, we completed the $300 million acquisition of twin peaks, which now operates 89 locations across 25 states further diversifying our restaurant portfolio and to Polish casual dining essentially sportswear as we continue to look to identify brands that complement our current portfolio.
Livery and high Avs and appealing growth pipelines twin peaks checks all the boxes with industry, leading news store a vs. In the range of five to six and a half million going as high as $12 million in some locations.
I believe we can grow this brand globally at a rapid pace ultimately achieving a 400 unit plus platform.
With projected the acquisition of twin peaks to add.
At least $30 million of post COVID-19 normalized EBITDA in 2022.
Twin peaks it achieve critically acclaimed ratings by both Knapp track and Black box intelligence over the last few years as well, having a rock star like management team led by Joe.
On December 15th 2021 we completed the acquisition of Adobe's presently at 216 store brand known for its freshly prepared pasta submarine sandwiches and unlimited signature Breadsticks Sentinel capital partners for $130 million.
This transaction was funded with cash from the issuance of new notes from our securitization facilities.
This transaction checked our boxes in a high growth brand with numerous identifiable synergies.
The brand's recent performance has been outstanding and we look forward to the added royalty from successful execution on the new unit opening plant. The brand was formerly led for 13 years My call Howard who recently retired as now in the hands of its former right hand, and the current there's always president Doug Boston, a 23 year for as long as that trend.
As we mentioned on our third quarter call. We expect the normalized EBITDA contribution from the Doe has always used to be approximately $14 5 million in 2022.
More specifically on the synergies, we see significant opportunities given our enormous purchasing power of more than $600 million per year in food beverage and paper as well as cross selling opportunities between our now 17 brand portfolio.
I'd like to take a moment and address the pending government investigations and pending or threatened litigation.
Being a public company and a public figure attracts its share of visibility.
As previously disclosed the company's directors were named as defendants in a shareholder derivative action last summer brought by the same shareholder that had been a part of prior lawsuits against the company after the company's IPO in 2017.
None of those lawsuits prevailed as the court denied certification yet the company spent considerable money defending itself in resolving matters.
Most recent derivative suit is based upon the merger a fog cutter capital group into fat brands. It transaction that was transformative for fat brands and led to its growth by more than 500% since the merger at the end of 2020.
It's important to note that this derivative action case does not assert claims against God brands, but seeks recovery on its behalf, meaning any monetary settlement goes to fat brands not paid by fat brands.
Given my personal history. It does not surprise me that the government will look into allegations also raised in the derivative complaint and as previously disclosed the government is now formally seeking documents concerning these matters from the company.
The government's affidavit should not have been made public when it was the subject of the seal Court order.
Nonetheless, the United States' Attorney's office has indicated that the company is not presently a target of the investigation and that the investigation primarily focuses on me and my family.
Oh wait times article published characterizations of the government's position has many factual errors and conflates the different entities and my family as if they were one.
Categorically deny the allegations raised in the L. A times article and look forward to the opportunity for our legal team to demonstrate that all transactions are properly documented reviewed approved and disclosed and multiple independent professionals were involved including the boards of both fog cutter and fat brands.
Counsel outside auditors, and my and fat brands tax adviser.
Our business is selling burgers shakes and fries pizza, meatballs cookies, and ice cream steaks, and chicken wings, and 29 degree cold beer to our customers they are coming into our restaurants more than ever and spending more than ever before.
Look forward to being able to put these matters behind us we have a very strong senior management team made up of 18 members of our 250 plus corporate team.
In addition to an active experienced an independent board of directors well. These legal matters are certainly a distraction personally our team is focused on running our business and integrating the newly acquired brands into the fat family of brands.
Turning to the acquisition front, we are still in the early innings. This is an exciting time for fat brands and we remain active in evaluating additional accretive acquisition candidates to augment our existing brands.
While we spent almost $1 billion in the past year I don't see that scale of acquisitions happening. This year. We are now at a size and scale, but we do not need to acquire additional brands. We already have so many great ones with so much organic growth already committed and paid for it that doesn't mean that we won't make some acquisitions in fact, we're considering some presently.
But our focus has to be this year on digesting, what we've already acquired and realizing synergies. Additionally, as previously mentioned there are significant cross selling opportunities amongst the franchise community within our 17 brand portfolio.
The fourth quarter marked yet another successful quarter for fat brands and it wouldn't be possible without the dedication and hard work of our team members our franchise partners and their employees I'm very proud and appreciative that our team members continue to deliver strong results. During this unique time with that I'd like to turn things over to Ken to talk about our financial highlights from the quarter.
Thank you Andy I'll walk through our capital structure, and then discuss the financial highlights of the fourth quarter and give some highlights into our expectations for normalized performance.
Mention on last quarter's earnings call in connection with the acquisition of twin peaks in the fourth quarter, we issued $250 million of new notes comprised of three tranches with a weighted average interest rate of six 8% and two 8 million shares of series B cumulative preferred stock.
In connection with the acquisition of <unk> and native Grilling wings in the fourth quarter, we issued $193 $8 million of new notes comprised of three tranches with a weighted average interest rate of six 7%.
This brings our total securitization facilities to $938 $2 million with a weighted average stated interest rate of $6 98 per cent.
Future issuances of our series B cumulative preferred stock and our common stock are available to us, which would provide us with additional flexibility to fund potential acquisitions further reduce our cost of capital and drive shareholder value.
Turning to our financial highlights total revenue during the fourth quarter increased 1042% to $74 $2 million, reflecting revenue from global franchise group acquired during the third quarter and revenue from twin peaks, there's always and native grilling wings acquired during the fourth quarter of 2020.
One.
Revenues also benefited from 12, 4% positive same store sales growth and 87, new store openings.
Cost and expenses increased to $77 million in the fourth quarter compared to $15 million in the year ago period.
New costs and expenses in 2021 includes $36 $9 million of company owned restaurant and factory factory operating costs related to the acquisitions of G. F. G twin peaks and there's always during 2021.
Additionally, these acquisitions contributed to higher G&A expense during the year.
And finally advertising expense increased $7 $1 million.
Advertising expenses from G F G and 20 and an increase in customer activity as the Covid recovery continues.
Other expense was $17 $1 million in the fourth quarter, primarily comprised of interest expense.
GAAP net loss for the quarter was $19 $6 million or $1.38 per diluted share.
Paired to a net loss of $7 $7 million or 64 cents per diluted share in the prior year period.
We also report a net loss on an as adjusted basis, which excludes the after tax impact of impairments refranchising activities acquisition costs and losses on extinguishment of debt.
On an as adjusted basis, our net loss was $16 $5 million or $1 16 per share compared to $5 $7 million or <unk> 48 per share in the prior year period.
Lastly, I'll provide some color regarding our revenue run rate and where we expect 2022 will be using 2019 as a guideline for our pre COVID-19 performance.
Based on the 'twenty to 'twenty, one performance of our portfolio and including the performance of GMT twin peaks as always and native grilling wings, we anticipate a normalized total annual revenue run rate of approximately $400 million.
And with that I'll turn the call back over to Andy to take some questions.
Thanks, Ken.
Operator, do we have any questions.
If you'd like to be placed in the question queue. Please press star one on your telephone keypad, a confirmation tone will indicate your line is in the question queue. You May press star two if he'd like to move your question from the queue. Once again Thats star one to be placed in the question queue.
Our first question today is coming from Joe Gomes from Noble capital. Your line is now live.
Good afternoon, Andy Congratulations on a transformative year.
Thank you Joe.
Well point out.
Question right here a clarification.
You were talking about the Q4 2021 same store sales.
Bye.
Concept.
And I thought you said twin peaks.
It was at 34% and 15, 8%.
As always 15, 7% and 25 six.
Correct I'm, just because I'm looking at the the.
The fly.
Slide presentation deck, and I thought that might have been.
But the numbers switched.
So I believe I'm, describing here that twin peaks was 15.8 over 2019 and 34 over 2020.
Right.
That's not what's happening.
My deck.
Okay. We'll go we'll go check the two and makes it so IDEXX accurate whichever one it is.
And because all these again I see 25.6 over 2019 to $15 seven over 'twenty, 'twenty, but maybe they're backwards.
Okay.
Perfect. If you could check that would be that would be great. So.
Just.
Kind of looking at.
A lot of the stuff you you you talked about which was great.
You know, maybe you could talk a little bit.
First on <unk>.
Supply chain and inflation and you know.
How you see that impacting.
The company expressly here I guess, you know what you can give us for the first quarter as we saw.
We've seen gas prices spike here, if you're seeing any issues are.
In terms of the inflation.
On the supply chain.
So we're definitely seeing inflation like everyone else in the 567% range. We've encouraged our franchise partners to take price. We are taking price at our company owned stores Theres been some margin compression in Q1 of course, we don't have that many company on stores just about $125.
2003 hundred restaurants today.
But you know and it's important that our franchise partners and and corporate take price are you also I think can't be naive about it and we need to make sure we're delivering value to the customers. If we're taking price. So that's gonna be a big focus of ours in the coming months and quarters that if we're taking price for inflation and maintain our margin we've got to make sure Theres Val.
New propositions for our customers so that they can justify paying out higher price you just can't say that everybody else is raising their prices. So we should raise our prices also in customers should expect to pay it you need to give them some value and that's something that's important that they were aware of and focused on we.
We are seeing also inflation and affecting supply chain in the usual ways, which is the availability of certain items really the availability of equipment for new store openings, you've seen a little bit of a delay like refrigeration equipment things like that it has slowed down new store openings by a month or two but nothing that's dramatic its just going to push it off a month or two so we're pressing as hard as we can.
To get what we think will be 120 to 125, new stores opened this year across our different brands and trying to find creative strategies to make sure that the supply chain is not holding up those openings and pushing them into 2023. We just have this gigantic pipeline of new stores to open as fast as we can and very active 2022.
Two in 2023 already.
Okay. Thanks for that.
Pardon me and you do mentioned about.
The buying power now you guys.
$600 million.
I understand how that helps the franchisees maybe.
Maybe does it really provide any benefit.
The fat brands itself, all the outside of you're helping your franchisees become more profitable.
Well I'm sure you know.
The buying power will save our franchisees.
100 basis points in price, which is amazing now in a rising price environment. Their price may only go up by 200 basis points less than it would otherwise go up so they may not quite see it as a decline in price versus an increase it's just going to be a smaller increase it definitely getting the benefit of our purchasing power in terms of the muscle for.
Being part of the top branch system.
Okay.
The manufacturing facility you you've talked about that in a couple of times in the past.
We're running up at one shift.
What has to happen here and in your view in order to kind of get that up maybe from one shift to two shifts.
And then what kind of timing are you looking to do that.
Yeah.
We have a son activities going on presently that we're evaluating that would increase our manufacturing business and I think it will see a material movement in that during the course of 2022 .
But it's definitely a very very much a front burner type of agenda item that we wanted to achieve this year is to really grow that factory business and so it is a big focus on it on our end.
Okay, and then you know Ken Thanks for giving us kind of the run rate on a normalized for for 'twenty 'twenty. Two you know could you do the same in terms of what you think you know kind of like an adjusted EBITDA margin could be.
Okay.
Hey.
Yeah, Let me let me yeah, I mean on an adjusted EBITDA basis, I think Andy mentioned in the comments, we're looking at somewhere in the $90 million to $95 million run rate adjusted EBITDA.
Okay.
Okay, Great and one last one and then I'll get back in queue.
I don't think so Andy but you know maybe you could just touch briefly I don't know if you know what's happening over in Russia, and Ukraine has any real impact on your you've seen you know.
The stories of some of the other major you know I think it was Mcdonald's and Burger King where the local franchisees are refusing to shut down I don't think you guys have any stores in those areas, but maybe you could just clarify that.
Are you seeing any impact from that.
Yeah, I mean, well.
We're not I mean, we're we're we're very stable in that in that sense I don't have any exposure there and I think we're just fortunate in that regard but.
Look the franchisees around the world are feeling the inflationary effects for sure of all of that.
And as I said, you know look at the franchise or if royalties go up because prices go up you know the there's actually an increase in revenue, but what's critical is that you know you don't have a decline in traffic and we certainly don't want to see a 1% increase in revenues and a 1% decline in traffic. So it's very important that we focus on that very important I'm looking at just to answer you.
I had a question about the slide deck versus the the.
The percentages that I referenced when I read off was accurate I'm completely the slide deck has twin peaks, if theres always numbers reversed in other words the column that says twin peaks you said, there's always call them in the column that says there's always this twin peaks, we just need to switch those logos around what will we repost that in a few minutes.
Okay, great. Thanks, Andy appreciate your time.
<unk>.
Thank you. Your next question today is coming from Gregory unfortunate off a private investor. Your line is now lives.
Hey, Andy how are you.
Hey, good thanks, Craig how are you.
I'm good thanks, Andy so you're pretty far along in the first quarter I, probably like 90% done could you give us an idea of what that's looking like.
Yeah, Q1 has been very strong and just again a ton of new franchise sales restaurant sales are comping very positively again.
<unk> business is really solid there, we're not going to see the expenses that we saw in the fourth quarter, whether they were bonus or compensation expenses or financing expenses or acquisition expenses. So a lot of the noise is going to go away and so I think Q1 will be much more in line with trying to get to that $90 million to $95 million run rate I don't think we will.
Are you there yet, but we have some synergies that we will realize over the coming couple of quarters like getting rid of some office leases on some some redundancies and things like that that we've we've already put in place.
For certain executives that we have to just run out those costs, but we really are making huge huge leap forward and the top line revenues just continue to impress us and like I said that some of the brands. It's just it's off the charts growth and off the charts.
In terms of traffic and so I feel really good about the business right. Now we are we are certainly focused on it it's.
Kind of a relief to be focused on executing at the business level on all of our brands and not be distracted with new acquisitions right now and our team is very focused on budgets and on synergies and on cost savings and and even you know the refinancings I can talk about.
Oh, well that's got somebody has got to put you right back on the ball.
And so the way that it sounds like like the ramp for EBITDA will be sort of it'll just ramp through the year to get to that $90 million to $95 million number is that the basic idea. That's right. That's right well, we will ramp them ran pretty quickly, but that's right. We will we will ramp up here Q1 O b.
Significant increase over Q4, and so on and those synergies just kick in and and also as we add 120, new stores. This year I think we have 20 of them opened 19 or 20 open so far through March but we have you know just.
A very very big backlog unscheduled to open I'm going throughout the year and then a very strong pipeline for next year. So.
We're growing significantly every month by new unit count across most of the brands and you know it's not every single brand. It has hockey stick growth, but we've got five or six of them. They really do and the numbers I read off about the pipeline and you know it's it's just there's just more and more demand for those brands right now.
Okay. Thank you.
You mentioned the 90 95.
EBITDA number of times, even last year, so I'm going to assume that you're fairly confident in that.
And I don't know if this is for your 10, but assuming those numbers are is there any risk to either the company dividend and or the preferred dividend and the preferred is trading as if it's a.
As if it's questionable.
The dividends are safe and we will continue and the preferred is trading at a crazy price compared to its redemption value.
Okay, just two more quick ones, you talked about refinancing last quarter.
Quarter, you'd talked about it a little bit this quarter can you just dig into your confidence level.
What that will do for us if you do get to refinance what youre hearing in the market as far as maybe what the rates look like or I mean, any color you can give us.
Yeah. So I mean, there's there's a bunch of options in terms of refinancing I mean this debt is 30 year debt at fixed rate. It doesn't amortize heavily for another four plus years advertisers a little bit starting in a year and a half. So we've got a lot of runway here to manage.
The debt, but we want to call and reissue it either on a rate basis or just at a lower interest rate, it's not reflective of basically paying for acquisition to me. It seems like it's more reflective of pain for long term financing and Theres a bunch of strategies to do that it doesn't just have to be rated but reading is one way to get that done and so we are at.
We are exploring all of those strategies now you know that's really a Q3 and Q4 activity more than anything just because the debt was issued beginning last April and then in July and then in October and in December . So a lot of that that has one year no calls or premiums if we call. It early.
We're actively working on it now so that look we can we can save a couple of hundred basis points. That's another 20 plus million dollars and free cash flow. That's free. So it's very important that we try to save you know two to 300 basis points, there and we're all about it you just cant do it too fast because were not allowed to yet.
Okay, alright, thanks, so much and keep up the good work.
Oh Sandy any one more one more question maybe for your 10.
But what's the cash on.
On the balance sheet now I didn't see the balance sheet.
So the year end cash position I think is around $55 million.
And that's our December 31 number and that's the only public numbers.
Okay, great. Thank you thanks, guys.
Thank you Greg.
Next question operational thing that your next question is coming from Roger lifting from lived in financial services. Your line is now live.
ESI Andi am I right.
This has been answered, but just to go back to the manufacturing facility for a second.
That's the lowest hanging fruit there in terms of adding to the.
Production, what kind of products.
Well there so there's distributing cookies throughout our brands for example, right now are some of our other brands like Roundtable pizza have cookies in it but there's always cells.
Ton of cookies, and they're buying the cookie dough from a third party and making it in the restaurant or having a premier they could buy cookie dough from the factory across 200 units with another 100 units coming online that would add significant cookie production. There we could do cookies in our Burger brands, which we've wanted to do deserve product for some time, that's another 700 restaurants.
So there's a bunch of opportunity to really grow the cookie business internally organically and even at twin peaks. If we wanted to do something similar to the E. D. J's dessert items and so you know there's a bunch of there's a bunch of things to pursue there, but also I think that there are incremental cookie business is that we can add to our portfolio as.
Bolt on acquisitions, where we'll not only get the franchise royalty revenue, but we'll get the manufacturing revenue and the way our factory works, we sell cookie dough to our franchisees.
And they are able to buy it at basically 20% lower cost than they would pay out in the marketplace. So they're saving 20%. So they love that and we're still making a nice profit on that cookie dough. So everyone wins, there and I think that's an opportunity to keep growing that business.
And the Zip.
Pipeline of course is very impressive.
Give us a rough idea of what.
What makes up that one.
The largest contributors to the pipeline yeah like I I think I said.
So this year's openings of 121.
Would it be a rough.
Makeup of the 100 120 stores this year.
Yeah, So you'll see I mean, it's spread out amongst you know twin peaks has an 2020 to 30 units that will open.
He says 20 years that will open the Burger brands have I have just a ton of units on fabric or Buffalo's Express.
Johnny Rockets elevation, Burger and Theres, a number of those opening several dozen of them each and then even in the global franchise group portfolio, where you have 157 locations in the pipeline you've got new round tables opening everyday new cookies and ice cream and pretzel brands opening.
So its fairly evenly spread out but it is it is.
So very strong and literally our supply chains and the only thing holding it back or we would be able to do more right now there's plenty of real estate out there the franchisees have plenty of demand to open throws it just got too.
They've got to do.
Just get that those leases signed to get their equipment.
Or.
Okay.
100 stores this year, how many of those might be twin peaks.
20 to 30 this.
This year.
Yes.
That's probably 20 twin peaks this year, yeah twin twin peaks says she's explosive growth seamless is always probably 'twenty because all of these this year.
Okay.
That's 40 out of 120 in and then you've got the Burger brands and pizza cookies and stuff like that in pieces.
Incremental.
I am in royalty.
Criminal just from this year, okay. Thanks, very much for the moment. Thank you Yeah, you bet and you know just just growing those those on those new store openings and grown the factory business is just really going to deliver them higher.
Hi acceleration in our EBITDA run rate. So we're very focused on it.
Alright, operator, I don't see any further questions.
Over to you for any further or closing comments.
Okay.
Thank you operator, I would like just to thank everyone for participating in today's call and with no further questions. We'll end the call. Thank you again.
Thank you that does conclude today's teleconference and webcast you may disconnect. Your line at this time and have a wonderful day, we thank you for your participation today.