Company: FWRG
Filing Date: 2025-04-08
Form Type: ARS
Source: 0001789940-25-000033
Chunk: 68

Company: First Watch Restaurant Group, Inc.
Filing Date: 2025-04-08
Form: ARS
Chunk 68
---
 franchise-owned) across 19 states resulting in a total of 572 system-wide restaurants (489 company-owned and 83 franchise-owned) across 29 states ___________________ *Comparison to the 52-week periods ended December 29, 2024 and December 31, 2023 in order to compare like-for-like periods. See “Key Performance Indicators” for additional information. ** See Non-GAAP Financial Measure Reconciliations section below. Business Trends During 2024, many restaurant industry sectors experienced downward sales pressure and traffic and “breakfast” was the most impacted daypart. The Company’s same-restaurant sales growth in 2024 was negative 0.5%, and partially offset by a 3.6% increase in carried price. Commodity inflation was 3.2% in 2024. We expect a high-single digit percentage increase in our 2025 commodity prices as compared to the prior year. Restaurant level labor inflation of 4.4% was offset by improvements in labor efficiencies. At year end, we were staffed with over 120 managers to lead and operate our future new company-owned restaurants. We expect 2% to 4% labor inflation in 2025. Continuing the Company’s expansion, Management intends to open 59 to 64 net new system-wide restaurants in 2025. In addition, Management has entered into two agreements to acquire 19 restaurants from franchisees. Adjusted EBITDA Margin: represents Adjusted EBITDA as a percentage of total revenues. See Non-GAAP Financial Measure Reconciliations below for a reconciliation to Net income margin, the most directly comparable GAAP measure. Restaurant Level Operating Profit: represents restaurant sales, less restaurant operating expenses, which include food and beverage costs, labor and other related expenses, other restaurant operating expenses, pre-opening expenses and occupancy expenses. Restaurant level operating profit excludes corporate-level expenses and other items that we do not consider in the evaluation of the ongoing core operating performance of our restaurants as identified in the reconciliation of Income from operations, the most directly comparable GAAP measure, to Restaurant level operating profit, included in the section Non- GAAP Financial Measure Reconciliations below. Restaurant Level Operating Profit Margin: represents Restaurant level operating profit as a percentage of restaurant sales. See Non-GAAP Financial Measure Reconciliations below for a reconciliation to Income from operations margin, the most directly comparable GAAP measure. Financial Highlights The financial results of 2024 reflect the continued growth of the Company. The Company continued to