Los Angeles, Nov. 17, 2017 (GLOBE NEWSWIRE) -- Giggles N’ Hugs, Inc. (OTCQB: GIGL), owner and operator of family-friendly restaurants that bring together high-end, organic food with active, cutting-edge play and entertainment for children, today announced its financial performance for the third quarter ended October 1, 2017 and provides a shareholder update on recent business activities.
Third Quarter Highlights include:
- Overall net sales increased 3.9% year-over-year to $652,977
- Net sales for Glendale location increased 4.8% year-over-year to $652,977
- Net sales for Topanga location increased 2.9% year-over-year to $306,377
- Restaurant level margin at Glendale was 30% for the quarter
- Cost of operations decreased 4.9% year-over-year to $485,308
- Loss from operations improved 10.0% year-over-year
- Net loss improved 71.2% year-over-year
“We continue to demonstrate that our business model works. In the second quarter sales were up, we posted strong margins for Glendale, lowered cost of operations nearly 5%, and generated significant improvements to the bottom line,” stated Joey Parsi, Founder and CEO of Giggle N’ Hugs. “Now with the help of a new capital raise, we can begin to scale up our operations, expanding both geographically, as well as through product line extensions, setting the stage for sustainable long-term growth and tremendous shareholder value improvement.”
Parsi continued, “I want to stress the significance of our 30% operating margins at the restaurant level for our Glendale location. Compare this to our publicly-traded peers, who on average typically see margins in the mid-teens at the restaurant level and you can really begin to see the potential for this business as we execute on our growth plans. Also, when in today’s environment the norm is negative comps versus the year before, for us to show strong year over increase in net sales is a testament to our unique concept. Add in the fact that we were able to achieve these results in the mostly sunny and warm weather here in Southern California which provides our potential customers with a wealth of other play and party options year-round; once we move into new markets and regions where the weather is seasonal and or more extreme in such markets as Seattle and or the East Coast, in which our customers are driven indoors for birthday parties and play, we believe higher sales and even more impressive margins can be achieved.”
“As I have already mentioned, in order for us to expand, we will need additional capital, which is a vital component of our growth plans but we want to make sure that we do so in a way that we are rewarding our loyal shareholders while ensuring less dilution of their position in the company,” stated Parsi. “We want to assure our shareholders that we are dedicated to creating and improving shareholder value over the long term.
“We have established a unique concept in the market, we have an incredible management team that we now have in place, we have enormous opportunities that lie ahead for the company”. Parsi concluded, "we are very excited about the future, and with the expected funding coming into place, we think our best days lie ahead". Thank you for your continued support.”
Financial Results
During the third quarter ended October 1, 2017, net sales increased 3.9% from the year ago period, driven by celebrity promotional efforts among other factors. Same store sales at the Company’s Topanga and Glendale stores increased 2.9% and 4.8%, respectively.
For the quarter, Glendale increased same store sales to $346,600, while Topanga increased same store sales to $306,377
Total costs and operating expenses changed nominally, up 0.6% to $827,354 in the third quarter, down from $1,142,818 in the year ago period. The decline of was due to multiple factors such as the closing of the Century City store; lower general and administrative costs; lower other operating expenses; and lower depreciation.
Cost of operations decreased 4.9% to $485,308 in the third quarter, down from $510,097 in the year ago period.
Total general and administrative costs were $277,841 in the third quarter, up from $247,981 in the year ago period. The increase was mainly attributable to higher professional fees related to addressing the St. George financing.
The Company improved net loss by 71.2% in the third quarter, up $463,486 from a net loss of $650,739 in the year ago period, due to the factors noted above.
About Giggles N’ Hugs
Giggles N' Hugs is the first and only restaurant that brings together high-end, organic food with active, cutting-edge play and entertainment for children. Every Giggles N' Hugs location offers an upscale, family-friendly atmosphere with a dedicated play area that children 10 and younger absolutely love. We feature high-quality menus made from fresh and local foods, nightly entertainment such as magic shows, concerts, puppet shows and face painting, and hugely popular party packages for families that want to do something special.
Forward Looking Statements:
Certain statements in this press release constitute "forward-looking statements" within the meaning of the federal securities laws. Words such as "may," "might," "will," "should," "believe," "expect," "anticipate," "estimate," "continue," "predict," "forecast," "project," "plan," "intend" or similar expressions, or statements regarding intent, belief, or current expectations, are forward-looking statements. While the Company believes these forward-looking statements are reasonable, undue reliance should not be placed on any such forward-looking statements, which are based on information available to us on the date of this release. These forward looking statements are based upon current estimates and assumptions and are subject to various risks and uncertainties, including without limitation those set forth in the Company's filings with the Securities and Exchange Commission (the "SEC"). Thus, actual results could be materially different. The Company expressly disclaims any obligation to update or alter statements whether as a result of new information, future events or otherwise, except as required by law.