Company: FWRG
Filing Date: 2025-08-05
Form Type: 10-Q
Source: 0001789940-25-000072
Chunk: 46

Company: First Watch Restaurant Group, Inc.
Filing Date: 2025-08-05
Form: 10-Q
Item: Part I, Item 1
Chunk 46
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)%8,426 28,733 (70.7)%As a percentage of restaurant sales2.4 %6.4 %(4.0)%1.4 %5.8 %(4.4)%

Income from operations margin decreased during the thirteen and twenty-six weeks ended June 29, 2025 as compared to the same periods in the prior year primarily due to increases in restaurant level expenses as a percent of restaurant sales, primarily (i) food and beverage cost inflation, (ii) labor and other related expenses including health insurance, (iii) occupancy and preopening rent expense, (iv) other restaurant operating expenses and (v) depreciation and amortization expense driven by restaurant growth, offset in part by leveraging certain general and administrative expenses.

Income from operations decreased during the thirteen and twenty-six weeks ended June 29, 2025 as revenue increases were exceeded by increases in various other costs compared to the same periods in the prior year including (i) labor and related expenses, (ii) food and beverage costs, (iii) other restaurant operating expenses, (iv) occupancy and preopening rent expense, (v) general and administrative expenses and (vi) depreciation and amortization expense.

Interest Expense

Interest expense primarily consists of interest and fees on our outstanding debt and the amortization expense for debt discount and deferred issuance costs. 

THIRTEEN WEEKS ENDEDTWENTY-SIX WEEKS ENDED(in thousands)JUNE 29, 2025JUNE 30, 2024ChangeJUNE 29, 2025JUNE 30, 2024ChangeInterest expense$4,003 $3,381 18.4 %$7,337 $5,980 22.7 %

The increase in interest expense during the thirteen and twenty-six weeks ended June 29, 2025 as compared to the same periods in the prior year was primarily due to increased borrowings associated with franchise acquisitions.

Other Income, Net

Other income, net includes items deemed to be non-operating based on management’s assessment of the nature of the item in relation to our core operations.

THIRTEEN WEEKS ENDEDTWENTY-SIX WEEKS ENDED(in thousands)JUNE 29, 2025JUNE 30, 2024ChangeJUNE 29, 2025JUNE 30, 2024ChangeOther income, net$266 $713 (62.7)%