Company: FWRG
Filing Date: 2025-05-06
Form Type: 10-Q
Source: 0001789940-25-000041
Chunk: 31

Company: First Watch Restaurant Group, Inc.
Filing Date: 2025-05-06
Form: 10-Q
Item: Part I, Item 1
Chunk 31
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 assets deemed not realizable, including state charitable contribution carryovers, various state loss carryforwards and various federal tax credit carryforwards.

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Table of ContentsFIRST WATCH RESTAURANT GROUP, INC.NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Management continues to assess the rationale for recording a valuation allowance for deferred tax assets. As the Company’s future taxable earnings increase and deferred tax assets are utilized, it is possible that a portion of the valuation allowance will no longer be needed. Release of any valuation allowance would result in the recognition of certain deferred tax assets and a decrease to income tax expense in the period of the release. The timing and amount of any release related to future taxable income is currently indeterminable.

12.    Commitments and Contingencies

Legal ProceedingsThe Company is subject to legal proceedings, claims and liabilities that arise in the ordinary course of business. The amount of the anticipated liability with respect to these matters was not material as of March 30, 2025. In the event any litigation losses become probable and estimable, the Company will recognize anticipated losses.

13.    Segment Information

Management determined the Company’s single operating segment on the basis that the Company’s Chief Operating Decision Maker (the “CODM”), the Chief Executive Officer, assesses performance and allocates resources at the Company’s consolidated level. The Company’s CODM uses consolidated net income to evaluate performance and make key operating decisions, such as investments in our long-term growth strategy. This measure is also used to monitor budget against actual results. Revenue is derived from sales of food and beverage, net of discounts, by our restaurants as well as franchise royalty, system fund and initial franchise fees. The measure of total assets for the reporting segment is reported on the consolidated balance sheets as total assets. The measure of capital expenditures for the reporting segment is reported on the consolidated statements of cash flows. The following table details consolidated net (loss) income for the segment for the periods indicated:THIRTEEN WEEKS ENDED(in thousands)MARCH 30, 2025MARCH 31, 2024Total revenues$282,240 $242,449 Less:Food and beverage costs66,647 52,184 Labor and other related expenses96,754 79,735 Other restaurant operating expenses44,259 36,792 Occupancy expenses23,149 19,168 Pre-opening expenses2,660 1,567 Stock-based compensation2,