ARK RESTAURANTS CORP Q2 FY2025 earnings call

• Cash balance was $11.1 million, up from year-end; debt down to $4.3 million.
• Had goodwill impairment of $3.4 million and $4.8 million valuation allowance on deferred tax assets.
• EBITDA negatively affected by $650,000 consultancy and legal fees for Bryant Park lease retention.
• Venue performances: Alabama steady, NY (Robert) doing well, FL up, DC improving with new management, Vegas more efficient with cash flow improvement.
• Bryant Park leases: Leases expired April 30, holdover tenant, filed claim in NY Supreme Court alleging RFP corruption; eviction proceeding expected, case to take 1-1.5 years.
• Meadowlands: Casino license dependent on downstate NYC licenses, likely by end of year; Meadowlands best positioned for Northern NJ casino gaming.

At the end of the quarter, cash balance was $11.1 million, up approximately $900,000 from year-end. Debt was down to $4.3 million. There were two significant noncash items: a goodwill impairment of $3.4 million due to stock price decline and interim triggering events, and a full valuation allowance on deferred tax assets of $4.8 million due to cumulative loss position. Venue performances: Alabama is steady; New York restaurants (Robert) are doing well; Florida restaurants have revenue up from last year; Washington, D.C. restaurant with new management is improving; Las Vegas is more efficient with cash flows improving.

• Working with bank to finalize new credit facility between $15 million to $20 million, with current $4.3 million termed out over 3 years.
• Bryant Park lease case expected to take 1 to 1.5 years.
• Meadowlands casino license dependent on downstate NYC licenses, likely issued by end of 2025.

• Goodwill impairment due to stock price decline and Bryant Park lease uncertainties.
• Valuation allowance on deferred tax assets as a result of cumulative loss position.
• Uncertainty around Bryant Park lease eviction proceeding.
• Credit agreement expiring on June 1, with new facility being finalized.

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