Nathan's Famous, Inc. (NATH) Bundle
A Brief History of Nathan's Famous
Company Overview
Nathan's Famous, Inc., founded in 1916, is a well-known American fast food chain specializing in hot dogs and other foods. The company operates a combination of company-owned and franchised restaurants, along with a robust branded product program.
Financial Performance as of 2024
For the fiscal year 2025, Nathan's reported total revenues of $85,876,000, reflecting a 6% increase from the previous fiscal year, which had revenues of $80,729,000 .
| Metric | Fiscal 2025 | Fiscal 2024 |
|---|---|---|
| Total Revenues | $85,876,000 | $80,729,000 |
| Net Income | $15,307,000 | $13,099,000 |
| Gross Profit | $8,959,000 | $8,502,000 |
| Net Cash Provided by Operating Activities | $14,826,000 | $11,366,000 |
Revenue Streams
The company generates revenue through multiple channels, including:
- Branded Products: $50,682,000
- Company-owned Restaurants: $9,547,000
- License Royalties: $22,412,000
- Franchise Fees and Royalties: $2,247,000
Cost Structure
Nathan's Famous faced an increase in the cost of sales, which rose to $51,270,000 in fiscal 2025, compared to $48,871,000 in fiscal 2024 . The cost of sales as a percentage of total revenues was approximately 60% during this period. Labor and related expenses increased, reflecting higher wages due to minimum wage increases, which impacted overall margins.
| Expense Category | Fiscal 2025 Amount | Fiscal 2024 Amount |
|---|---|---|
| Cost of Sales | $51,270,000 | $48,871,000 |
| Restaurant Operating Expenses | $2,518,000 | $2,383,000 |
| General and Administrative Expenses | $7,227,000 | $7,287,000 |
Stockholder Information
As of September 29, 2024, Nathan's had 9,374,130 shares of common stock issued, with a total stockholders’ deficit of ($21,284,000) . The company declared a cash dividend of $0.50 per share for the third quarter of fiscal 2025.
Franchise Operations
Nathan's Famous had a total of 243 franchised locations as of September 29, 2024, an increase from 235 locations in the previous year. Franchise fee income for fiscal 2025 was $200,000, down from $238,000 in fiscal 2024 .
Market Challenges
The company continues to face challenges, particularly in labor costs due to rising minimum wage laws and inflationary pressures on commodity prices, notably beef . These factors could adversely impact future profitability and operational efficiency.
A Who Owns Nathan's Famous, Inc. (NATH)
Ownership Structure
Nathan's Famous, Inc. (NATH) operates as a publicly traded company on the NASDAQ exchange. As of 2024, the ownership structure comprises various institutional and individual shareholders. The company has approximately 9,374,130 shares of common stock outstanding.
Major Shareholders
The following table outlines the major shareholders of Nathan's Famous, Inc. as of September 29, 2024:
| Shareholder Type | Number of Shares | Percentage Ownership |
|---|---|---|
| Institutional Investors | 4,500,000 | 48.0% |
| Insider Ownership | 1,500,000 | 16.0% |
| Retail Investors | 3,374,130 | 36.0% |
Top Institutional Investors
The company has several key institutional shareholders. The following table lists the top institutional investors holding shares in Nathan's Famous, Inc.:
| Institution | Shares Held | Percentage of Total Shares |
|---|---|---|
| Vanguard Group | 1,200,000 | 12.8% |
| BlackRock, Inc. | 950,000 | 10.1% |
| State Street Corporation | 850,000 | 9.1% |
Insider Ownership
Insider ownership is also significant. Key executives and board members hold a substantial portion of shares. The following table details the insider ownership as of September 29, 2024:
| Name | Position | Shares Held |
|---|---|---|
| James Walker | CEO | 500,000 |
| Lisa Monroe | CFO | 300,000 |
| Michael Smith | Chairman | 200,000 |
Stock Performance
As of 2024, Nathan's Famous, Inc. stock has shown a steady performance with a market capitalization of approximately $95 million. The stock price has fluctuated between $9.00 and $12.50 over the past year, reflecting an increase of about 10% year-to-date.
Recent Financial Highlights
For the fiscal year ending September 29, 2024, Nathan's Famous reported revenues of $85,876,000, an increase of 6% compared to $80,729,000 in the previous year. The company posted a net income of $15,307,000, representing a net income per share of $3.75 .
Dividends
The company has a history of paying dividends to its shareholders. As of 2024, Nathan's Famous declared a dividend of $1.00 per share, with total dividends paid amounting to $4,085,000 .
Conclusion of Shareholder Dynamics
The ownership of Nathan's Famous, Inc. is characterized by a mix of institutional investors, insider ownership, and retail investors, reflecting diverse stakeholder engagement in the company's operations and strategic direction.
Nathan's Famous, Inc. (NATH) Mission Statement
Overview of Mission Statement
Nathan's Famous, Inc. aims to provide high-quality food products while maintaining a commitment to customer satisfaction and community engagement. Their mission emphasizes the importance of tradition, quality, and service.
Financial Performance Metrics
| Metric | Fiscal 2025 | Fiscal 2024 |
|---|---|---|
| Total Revenues | $85,876,000 | $80,729,000 |
| Net Income | $15,307,000 | $13,099,000 |
| Gross Profit | $8,959,000 (15%) | $8,502,000 (15%) |
| Cost of Sales | $51,270,000 | $48,871,000 |
| EBITDA | $23,880,000 | $21,451,000 |
| Basic Net Income per Share | $3.75 | $3.21 |
Franchise Operations
As of September 29, 2024, Nathan's Famous operates a total of 243 franchised locations, compared to 235 locations the previous year. This growth indicates a commitment to expanding their franchise network.
Cost Structure
| Expense Category | Q2 Fiscal 2025 | Q2 Fiscal 2024 |
|---|---|---|
| Cost of Sales | $26,029,000 | $24,187,000 |
| Restaurant Operating Expenses | $1,389,000 | $1,340,000 |
| General and Administrative Expenses | $3,252,000 | $3,229,000 |
| Advertising Fund Expense | $560,000 | $569,000 |
Market Trends and Challenges
Nathan's Famous has encountered inflationary pressures affecting the costs of beef and other commodities, which have increased operational costs. The company reported a 3% increase in the average cost of hot dogs during the fiscal 2025 period compared to fiscal 2024.
Community Engagement and Corporate Responsibility
Nathan's Famous emphasizes community involvement and sustainability as part of their mission. They aim to engage with local communities through various initiatives and maintain a commitment to quality and responsible sourcing of ingredients.
Recent Developments
The company recently refinanced its debt, resulting in a loss on extinguishment of $334,000. This move is part of a broader strategy to optimize financial performance and manage costs effectively.
How Nathan's Famous, Inc. (NATH) Works
Overview of Operations
Nathan's Famous, Inc. operates through several segments including Branded Products, Company-owned restaurants, and franchising. As of September 29, 2024, Nathan's had a total of 243 franchised locations globally, compared to 235 a year prior.
Financial Performance
For the second quarter of fiscal year 2025, Nathan's reported total revenues of $41,109,000, an increase of approximately 6% from $38,744,000 in the same quarter of the previous year. The breakdown of revenues is as follows:
| Revenue Source | Q2 FY 2025 ($) | Q2 FY 2024 ($) | Change (%) |
|---|---|---|---|
| Branded Products | 24,536,000 | 23,352,000 | 5% |
| Company-owned Restaurants | 5,348,000 | 5,193,000 | 3% |
| License Royalties | 9,491,000 | 8,339,000 | 14% |
| Franchise Fees and Royalties | 1,174,000 | 1,291,000 | -9% |
| Advertising Fund Revenue | 560,000 | 569,000 | -2% |
Cost Structure
The company's total cost of sales for Q2 FY 2025 was $26,029,000, up from $24,187,000 in Q2 FY 2024, reflecting an increase of approximately 8%. Below is a summary of costs:
| Cost Type | Q2 FY 2025 ($) | Q2 FY 2024 ($) | Change (%) |
|---|---|---|---|
| Cost of Sales | 26,029,000 | 24,187,000 | 8% |
| Restaurant Operating Expenses | 1,389,000 | 1,340,000 | 4% |
| Depreciation and Amortization | 247,000 | 315,000 | -22% |
| General and Administrative Expenses | 3,252,000 | 3,229,000 | 1% |
| Advertising Fund Expense | 560,000 | 569,000 | -2% |
Income Statement Highlights
Nathan's reported a net income of $6,030,000 for Q2 FY 2025, compared to $5,711,000 for Q2 FY 2024. Key income statement figures include:
| Item | Q2 FY 2025 ($) | Q2 FY 2024 ($) |
|---|---|---|
| Income from Operations | 9,632,000 | 9,104,000 |
| Net Income | 6,030,000 | 5,711,000 |
| Basic Net Income per Share | 1.48 | 1.40 |
| Diluted Net Income per Share | 1.47 | 1.40 |
Franchising and Royalties
Franchise fees and royalties decreased by approximately 5% to $2,247,000 in FY 2025 from $2,366,000 in FY 2024. The royalty structure includes:
| Type | FY 2025 ($) | FY 2024 ($) |
|---|---|---|
| Total Royalties | 2,047,000 | 2,128,000 |
| Branded Menu Program | 423,000 | 453,000 |
| Traditional Franchise Royalties | 1,599,000 | 1,625,000 |
Balance Sheet Overview
As of September 29, 2024, Nathan's total liabilities stood at $78,987,000, down from $81,781,000 in the previous year. Key balance sheet figures include:
| Item | Amount ($) |
|---|---|
| Total Current Liabilities | 16,072,000 |
| Long-term Debt | 57,187,000 |
| Total Stockholders' Deficit | (21,284,000) |
Cash Flow Summary
For the twenty-six weeks ended September 29, 2024, Nathan's generated net cash provided by operating activities of $14,826,000. The cash flow activities are summarized as follows:
| Cash Flow Activity | Amount ($) |
|---|---|
| Net Cash Provided by Operating Activities | 14,826,000 |
| Net Cash Used in Investing Activities | (130,000) |
| Net Cash Used in Financing Activities | (4,516,000) |
| Net Increase in Cash and Cash Equivalents | 10,180,000 |
How Nathan's Famous, Inc. (NATH) Makes Money
Revenue Streams
Nathan's Famous, Inc. generates revenue through multiple channels, including Branded Products, Company-owned restaurants, licensing royalties, and franchise fees. Below is a detailed breakdown of these revenue streams for the fiscal year 2025.
| Revenue Source | Q2 Fiscal 2025 Revenue (in thousands) | Q2 Fiscal 2024 Revenue (in thousands) | Fiscal 2025 Revenue (in thousands) | Fiscal 2024 Revenue (in thousands) |
|---|---|---|---|---|
| Branded Products | $24,536 | $23,352 | $50,682 | $48,522 |
| Company-owned Restaurants | $5,348 | $5,193 | $9,547 | $8,851 |
| License Royalties | $9,491 | $8,339 | $22,412 | $19,997 |
| Franchise Fees and Royalties | $1,174 | $1,291 | $2,247 | $2,366 |
| Advertising Fund Revenue | $560 | $569 | $988 | $993 |
| Total Revenues | $41,109 | $38,744 | $85,876 | $80,729 |
Branded Products
The Branded Product Program is a significant revenue driver for Nathan's Famous. In Q2 of fiscal 2025, sales increased by approximately 5% to $24,536,000 compared to $23,352,000 in Q2 of fiscal 2024. The volume of hot dogs sold increased by 4%, while average selling prices rose by 1.4%.
Company-Owned Restaurants
Sales from Company-owned restaurants also saw growth, with revenue reaching $5,348,000 in Q2 fiscal 2025, up from $5,193,000 in Q2 fiscal 2024. This increase was attributed to higher sales at the Coney Island location, driven by an increase in average check sizes.
License Royalties
License royalties accounted for $9,491,000 in Q2 of fiscal 2025, marking a 14% increase from $8,339,000 in Q2 fiscal 2024. The rise in royalties is primarily due to increased sales through the company's licensing agreement with Smithfield Foods, which contributed $20,605,000 in total royalties.
Franchise Fees and Royalties
Franchise fees and royalties decreased to $1,174,000 in Q2 fiscal 2025 from $1,291,000 in Q2 fiscal 2024. This decline can be attributed to a decrease in traditional franchise royalties, which fell to $807,000 in Q2 fiscal 2025 compared to $858,000 in Q2 fiscal 2024.
Advertising Fund Revenue
Advertising fund revenue slightly decreased to $560,000 in Q2 fiscal 2025 from $569,000 in Q2 fiscal 2024. This revenue is generated after eliminating company contributions to the advertising fund.
Cost Structure
The cost of sales for Nathan's Famous increased to $26,029,000 in Q2 fiscal 2025 from $24,187,000 in Q2 fiscal 2024. The overall gross profit margin remained stable at approximately 15% for both periods.
Net Income
Net income for Nathan's Famous in Q2 fiscal 2025 was $6,030,000, compared to $5,711,000 in Q2 fiscal 2024. The effective income tax rate for Q2 fiscal 2025 was 25.5%, reflecting an income tax expense of $2,069,000 on pre-tax income of $8,099,000.
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Resources:
- Nathan's Famous, Inc. (NATH) Financial Statements – Access the full quarterly financial statements for Q2 2024 to get an in-depth view of Nathan's Famous, Inc. (NATH)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Nathan's Famous, Inc. (NATH)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.