Good Times Restaurants Inc. has raised $5.5 million in a public stock offering that will help it grow the Bad Daddy’s Burger Bar concept, the company said Wednesday.
The Golden, Colo.-based company operates and franchises the Good Times Burgers & Frozen Custard chain, a quick-service concept with most of its 39 units located in Colorado.
Gross proceeds of $5.5 million will be used to open Bad Daddy units and remodel existing Good Times units.
Good Times offered 2.2 million shares of common stock at $2.50 per share, along with warrants to purchase 2.5 million shares of common stock at $2.75 per share and additional warrants to buy 1.26 million shares at $2.50 per share.
Maxim Group LLC acted as the sole book-running manager for the offering, the company said.
In April, Good Times acquired a 48-percent stake in the Charlotte, N.C.-based franchisor of Bad Daddy’s Burger Bar, a full-service concept specializing in gourmet burgers, chopped salads, sandwiches and craft beers. Good Times Restaurants also established a subsidiary called BD of Colorado LLC to franchise Bad Daddy’s restaurants in Colorado, Arizona and Kansas.
The first two of Good Times’ Bad Daddy locations are scheduled to open in Colorado before the end of the year.
The Bad Daddy chain includes four locations in North Carolina with a fifth operated by HMSHost at Charlotte Douglas International Airport. The company has signed franchisees to open three more units in both North and South Carolina.
For the third quarter ended June 30, Good Times Restaurants reported net income of $208,000, an increase of $37,000 from the prior year, including expenses and losses of $52,000 related to the start-up of Bad Daddy’s, the company said.
Same-store sales for company-owned Good Times locations increased 15.2 percent for the quarter, with about 7.2 percent of that growth attributed to the launch of breakfast in November. The introduction of hand-breaded, all-natural chicken tenders also boosted sales, the company said.
“This is the first full quarter this year that we’ve been able to realize the full profit flow through on the significant same-store-sales increases we’ve had in the last several months, including our new breakfast daypart that is performing above expectations,” said Good Times Restaurants president and chief executive Boyd Hoback in a statement. “It is particularly important that most of our sales increases are coming from increased traffic and not pricing or an increased average check, as we continue to compound our growth year over year.”
Good Times Restaurants has been a public company since 1992 and trades on the NASDAQ Small Cap under the ticker symbol GTIM.
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