Business Context and Reporting Period
Cannae Holdings, Inc. (NYSE: CNNE), the majority owner and operator of the Ninety Nine Restaurant & Pub concept, filed this Form 8-K on January 11, 2018. The report provides preliminary unaudited sales results for the fiscal fourth quarter (17 weeks ended December 31, 2017) and the full fiscal year (53 weeks ended December 31, 2017). Full audited results are expected to be reported later in the first quarter of 2018.
Key Financial Metrics
| Metric | Q4 2017 (17 weeks) | Q4 2016 (16 weeks) | Full Year 2017 (53 weeks) | Full Year 2016 (52 weeks) |
|---|---|---|---|---|
| Net Revenue | $96.5 million | $89.5 million | $311.2 million | $304.0 million |
| Year-over-Year Change | +$7.0 million (7.8%) | - | +$7.2 million (2.4%) | - |
Note: The filing does not provide data on profit, cash flow, margins, debt, or liquidity. The reported revenue increase includes an estimated $6.0 million impact from an additional week of operations in the 2017 periods.
Material Changes
- Revenue Growth: Net revenue for Ninety Nine Restaurants increased 7.8% in the fourth quarter and 2.4% for the full fiscal year compared to the prior comparable periods.
- Calendar Impact: The 2017 reporting periods included an extra week of operations compared to 2016. Management estimates this additional week contributed approximately $6.0 million to the revenue totals for both the quarter and the full year.
Outlook, Risks, and Management Commentary
Management expects to report full fourth quarter and fiscal 2017 results later in the first quarter of 2018. The filing includes standard forward-looking statements warning that actual results may differ materially from projections due to various risks.
- Risks: Potential differences between preliminary and final results; changes in economic, business, and political conditions; financial market volatility; unemployment and interest rate fluctuations; commodity price changes; and significant competition within the restaurant industry.
- Regulatory: Compliance with government regulations affecting operating subsidiaries.
Investor Verification Checklist
- Verify the final audited revenue figures when the full Q4 and fiscal 2017 results are released in Q1 2018.
- Assess the organic growth rate by excluding the estimated $6.0 million impact of the additional week of operations.
- Review the upcoming full financial statements for data on profitability, cash flow, and debt levels, which are not included in this preliminary 8-K.
- Monitor commodity prices and labor market conditions as cited risks affecting future restaurant operations.