Good Times Restaurants Inc.

Previous wording

Overview. Good Times Restaurants Inc., through its subsidiaries (collectively, the “Company” or “we”, “us” or “our”) operates and licenses full-service hamburger-oriented restaurants under the name Bad Daddy’s Burger Bar (“Bad Daddy’s”) and operates and franchises hamburger-oriented drive-through restaurants under the name Good Times Burgers & Frozen Custard (“Good Times”).

Current wording

Overview. Good Times Restaurant Inc., through its subsidiaries (collectively, the “Company” or “we”, “us” or “our”) operates and licenses full-service hamburger-oriented restaurants under the name Bad Daddy’s Burger Bar (“Bad Daddy’s”) and operates and franchises hamburger-oriented drive-through restaurants under the name Good Times Burgers & Frozen Custard (“Good Times”).

Previous wording

Growth Strategies and Outlook. We believe there are significant opportunities to grow customer traffic and increase awareness of our brands, leading to organic sales growth. We also believe there are unit growth opportunities for both of our concepts though we continue to execute unit growth with increased scrutiny surrounding real estate selection and a more conservative approach to leverage than we previously took, considering the higher costs and volatile inflation present in the current operating environment.

Current wording

Growth Strategies and Outlook. We believe there are significant opportunities to grow customer traffic and increase awareness of our brands, leading to organic sales growth. We also believe there are unit growth opportunities for both of our concepts though we continue to execute unit growth with increased scrutiny surrounding real estate selection and a more conservative approach to leverage than we previously took, in light of the higher costs and volatile inflation present in the current operating environment.

Previous wording

Restaurant locations. As of March 31, 2026, we operated, franchised, or licensed a total of thirty-eight Bad Daddy’s restaurants and thirty Good Times restaurants. The following table presents the number of restaurants operating at the end of the fiscal quarters ended March 31, 2026 and April 1, 2025.

Current wording

Restaurant Locations. As of June 30, 2026, we operated, franchised, or licensed a total of thirty-seven Bad Daddy’s restaurants and twenty-eight Good Times restaurants. The following table presents the number of restaurants operating at the end of the fiscal quarters ended June 30, 2026 and July 1, 2025.

Previous wording

*Includes one Good Times restaurant that is temporarily closed for lease negotiation.

Current wording

*Does not include one Good Times restaurant that is temporarily closed.

Previous wording

*Net Revenues.*Net revenues for the quarter ended March 31, 2026 decreased $1,047,000 or 3.1% to $33,232,000 from $34,279,000 for the quarter ended April 1, 2025. Bad Daddy’s concept revenues decreased $930,000 while our Good Times concept revenues decreased $117,000 compared to the same prior-year quarter.

Current wording

*Net Revenues.*Net revenues for the fiscal quarter ended June 30, 2026 decreased $1,858,000 or 5.0% to $35,167,000 from $37,025,000 for the fiscal quarter ended July 1, 2025. Bad Daddy’s concept revenues decreased $1,634,000 and our Good Times concept revenues decreased $224,000 compared to the same prior year period.

Previous wording

Franchise and other revenues decreased $31,000 to $108,000 in the quarter ended March 31, 2026 compared to $139,000 in the quarter ended April 1, 2025. This decrease is primarily due to reduced gift card breakage.

Current wording

Franchise and other revenues decreased $9,000 to $147,000 for the quarter ended June 30, 2026 compared to $156,000 for the quarter ended July 1, 2025. This decrease is primarily due to reduced gift card breakage.

Previous wording

Sales store sales is a metric used in evaluating the performance of established restaurants and is a commonly used metric in the restaurant industry. Same store sales for our brands are calculated using all company-owned units open for at least eighteen full fiscal months and use the comparable operating weeks from the prior year to the current year quarter’s operating weeks.

Current wording

Same store sales is a metric used in evaluating the performance of established restaurants and is a commonly used metric in the restaurant industry. Same store sales for our brands are calculated using all Company-owned units open for at least eighteen full fiscal months and use the comparable operating weeks from the prior year to the current year quarter’s operating weeks.

Previous wording

Bad Daddy’s same store restaurant sales decreased 0.8% during the fiscal quarter ended March 31, 2026 compared to the fiscal quarter ended April 1, 2025, primarily driven by discounts provided through included sides and drink specials along with a decrease in demand across the sector for alcoholic beverages, as well as reduced customer traffic, partially offset by menu price increases. There were thirty-seven restaurants included in the same store sales base at the end of the quarter.

Current wording

Bad Daddy’s same store restaurant sales decreased 2.3% during the fiscal quarter ended June 30, 2026 compared to the fiscal quarter ended July 1, 2025, primarily driven by discounts provided through included sides and drink specials along with a decrease in demand across the sector for alcoholic beverages, as well as reduced customer traffic, partially offset by menu price increases and increased revenue from new menu items. There were thirty-six restaurants included in the same store sales base at the end of the quarter.

Previous wording

Food and Packaging Costs. Food and packaging costs for the fiscal quarter ended March 31, 2026 decreased $649,000 to $9,828,000 (29.7% of restaurant sales) from $10,477,000 (30.7% of restaurant sales) for the quarter ended April 1, 2025.

Current wording

Food and Packaging Costs. Food and packaging costs for the fiscal quarter ended June 30, 2026 decreased $647,000 to $10,711,000 (30.6% of restaurant sales) from $11,358,000 (30.8% of restaurant sales) for the quarter ended July 1, 2025.

Previous wording

Bad Daddy’s food and packaging costs were $7,092,000 (29.6% of restaurant sales) for the quarter ended March 31, 2026, down from $7,619,000 (30.7% of restaurant sales) for the quarter ended April 1, 2025. The decrease as a percentage of sales is primarily attributable to reduced waste and improved chicken pricing, partially offset by higher beef and bacon purchase prices compared to the prior-year quarter.

Current wording

Bad Daddy’s food and packaging costs were $7,546,000 (30.3% of restaurant sales) for the quarter ended June 30, 2026, down from $8,100,000 (30.6% of restaurant sales), for the quarter ended July 1, 2025. The decrease as a percent of sales is primarily attributable to improved non-beef protein costs combined with the impact of a 2.5% average increase in menu pricing, partially offset by higher produce costs and fuel surcharges.

Previous wording

Good Times food and packaging costs were $2,736,000 (29.7% of restaurant sales) for the quarter ended March 31, 2026, down from $2,858,000 (30.7% of restaurant sales) for the quarter ended April 1, 2025. The decrease as a percentage of sales is primarily attributable to reduced waste partially offset by higher beef and bacon prices compared to the prior-year quarter.

Current wording

Good Times food and packaging costs were $3,165,000 (31.2% of restaurant sales) for the quarter ended June 30, 2026, down from $3,258,000 (31.5% of restaurant sales)for the quarter ended July 1, 2025. The decrease is primarily attributable to reduced waste along with the impact of a 1.7% average increase in menu pricing, partially offset by higher fuel surcharges.

Previous wording

Payroll and Other Employee Benefit Costs. Payroll and other employee benefit costs for the quarter ended March 31, 2026 decreased $439,000 to $11,387,000 (34.4% of restaurant sales) from $11,826,000 (34.6% of restaurant sales) for the quarter ended April 1, 2025.

Current wording

Payroll and Other Employee Benefit Costs. Payroll and other employee benefit costs for the quarter ended June 30, 2026 decreased $945,000 to $11,702,000 (33.4% of restaurant sales) from $12,647,000 (34.3% of restaurant sales) for the quarter ended July 1, 2025.

Previous wording

Bad Daddy’s payroll and other employee benefit costs were $8,168,000 (34.1% of restaurant sales) for the quarter ended March 31, 2026, down from $8,510,000 (34.3% of restaurant sales) in the same prior year period. As a percentage of sales, payroll and employee benefits costs decreased by 0.2% primarily attributable to lower employee benefit costs, partially offset by higher average wage rates.

Current wording

Bad Daddy’s payroll and other employee benefit costs were $8,361,000 (33.6% of restaurant sales) for the quarter ended June 30, 2026 down from $9,103,000 (34.3% of restaurant sales) for the same prior year period. As a percentage of sales, payroll and employee benefit costs decreased by 0.7% primarily attributable to reduced salary costs partially offset by higher hourly labor costs.

Previous wording

Good Times payroll and other employee benefit costs were $3,219,000 (35.0% of restaurant sales) in the quarter ended March 31, 2026, down from $3,316,000 (35.6% of restaurant sales) in the same prior year period. As a percentage of sales, payroll and employee benefits costs decreased by 0.6% primarily attributable to increased labor efficiency, partially offset by higher average wage rates.

Current wording

Good Times payroll and other employee benefit costs were $3,341,000 (33.0% of restaurant sales) in the quarter ended June 30, 2026, down from $3,544,000 (34.2% of restaurant sales) in the same prior year period. As a percentage of sales, thedecrease is primarily due to increased labor efficiency, partially offset by higher average wage rates resulting from a combination of market forces and the inflation-indexed minimum wage rates in Denver and the state of Colorado.

Previous wording

Occupancy Costs. Occupancy costs for the quarter ended March 31, 2026 decreased $59,000 to $2,524,000 (7.6% of restaurant sales) from $2,583,000 (7.6% of restaurant sales) for the quarter ended April 1, 2025.

Current wording

Occupancy Costs. Occupancy costs for the quarter ended June 30, 2026 decreased $15,000 to $2,477,000 (7.1% of restaurant sales) from $2,492,000 (6.8% of restaurant sales) for the quarter ended July 1, 2025.

Previous wording

Good Times occupancy costs were $920,000 (10.0% of restaurant sales) in the quarter ended March 31, 2026, down from $939,000 (10.1% of restaurant sales) in the same prior year period. This was primarily due to a decrease in property taxes between the quarterly periods.

Current wording

Good Times occupancy costs were $920,000 (9.1% of restaurant sales) for the quarter ended June 30, 2026, up from $890,000 (8.6% of restaurant sales) in the same prior year period. This was primarilydue to an increase in property taxes between the quarterly periods.

Previous wording

Other Operating Costs. Other operating costs for the quarter ended March 31, 2026, increased $33,000 to $4,951,000 (14.9% of restaurant sales) from $4,918,000 (14.4% of restaurant sales) for the quarter ended April 1, 2025.

Current wording

Other Operating Costs. Other operating costs for the quarter ended June 30, 2026, decreased $161,000 to $5,069,000 (14.5% of restaurant sales) from 5,230,000 (14.2% of restaurant sales) for the quarter ended July 1, 2025.

Previous wording

Bad Daddy’s other operating costs were $3,739,000 (15.6% of restaurant sales) for the quarter ended March 31, 2026, up from $3,591,000 (14.5% of restaurant sales) in the same prior year period. As a percentage of sales, the increase is primarily due to increases in customer delivery and repair and maintenance expenses.

Current wording

Bad Daddy’s other operating costs were $3,809,000 (15.3% of restaurant sales) for the quarter ended June 30, 2026 down from $3,876,000 (14.6% of restaurant sales) in the same prior year period. As a percentage of sales, the increase is primarily due to increased customer delivery and travel expenses, partially offset by decreased repair and maintenance expenses.

Previous wording

Good Times other operating costs were $1,400,000 (15.2% of restaurant sales) for the quarter ended March 31, 2026, down from $1,407,000 (15.1% of restaurant sales) in the same prior year period. As a percentage of sales, the increase is primarily due to increases in customer delivery expenses.

Current wording

Good Times other operating costs were $1,389,000 (13.7% of restaurant sales) in the quarter ended June 30, 2026, down from $1,471,000 (14.2% of restaurant sales) in the same prior year period. As a percentage of sales, the decrease is primarily due to reduced operating supplies and R&M expenses, partially offset by utility cost increases.

Previous wording

New Store Preopening Costs. There were no preopening costs in the fiscal quarters ended March 31, 2026 and April 1, 2025

Current wording

New Store Preopening Costs. There were no preopening costs in the quarters ended June 30, 2026 or July 1, 2025.

Previous wording

Depreciation and Amortization Costs. Depreciation and amortization costs for the quarter ended March 31, 2026 decreased $118,000 to $878,000 from $996,000 in the quarter ended April 1, 2025.

Current wording

Depreciation and Amortization Costs. Depreciation and amortization costs for the quarter ended June 30, 2026, decreased $65,000 to $917,000 from $982,000 in the quarter ended July 1, 2025.

Previous wording

Bad Daddy’s depreciation and amortization costs for the quarter ended March 31, 2026 decreased $127,000 to $621,000 from $748,000 in the quarter ended April 1, 2025. The decrease is primarily due to assets performing past their estimated usable lives.

Current wording

Bad Daddy’s depreciation and amortization costs for the quarter ended June 30, 2026 decreased $64,000 to $668,000 from $732,000 in the quarter ended July 1, 2025. The decrease is primarily due to assets performing past their estimated useful lives.

Previous wording

General and Administrative Costs. General and administrative costs for the quarter ended March 31, 2026, decreased $382,000 to $2,196,000 (6.6% of total revenues) from $2,578,000 (7.5% of total revenues) for the quarter ended April 1, 2025.

Current wording

General and Administrative Costs. General and administrative costs for the quarter ended June 30, 2026, decreased $188,000 to $1,986,000 (5.6% of total revenues) from 2,174,000 (5.9% of total revenues) for the quarter ended July 1, 2025.

Previous wording

This decrease in general and administrative expenses for the quarter ended March 31, 2026 is attributable to:

Current wording

This decrease in general and administrative expenses in the quarter ended June 30, 2026 is primarily attributable to:

Previous wording

Advertising Costs. Advertising costs for the quarter ended March 31, 2026 increased $69,000 to $984,000 (3.0% of total revenues) from $915,000 (2.7% of total revenues) for the quarter ended April 1, 2025.

Current wording

Advertising Costs. Advertising costs for the quarter ended June 30, 2026, increased $96,000 to $1,009,000 (2.9% of total revenues) from $913,000 (2.5% of total revenues) for the quarter ended July 1, 2025.

Previous wording

Bad Daddy’s advertising costs were $479,000 (2.0% of total revenues) in the quarter ended March 31, 2026 compared to $494,000 (2.0% of total revenues) in the same prior year period.

Current wording

Bad Daddy’s advertising costs were $516,000 (2.1% of total revenues) in the quarter ended June 30, 2026 compared to $542,000 (2.0% of total revenues) in the same prior year period. Bad Daddy’s advertising costs consist primarily of third-party gift card commissions, promotional campaigns on third-party delivery platforms, social media and print production.

Previous wording

Good Times advertising costs were $488,000 (5.3% of total revenues) in the quarter ended March 31, 2026 compared to $424,000 (4.5% of total revenues) in the same prior year period. The increase is primarily due to increased advertising campaigns including video streaming, promotional campaigns on third-party delivery platforms, and celebrity and influencer partnerships, partially offset by reduced radio media. Good Times advertising costs consist primarily of social media, third-party delivery promotions and video streaming advertising. Advertising costs are presented gross, with franchisee contributions to the fund being recognized as a component of franchise revenues.

Current wording

Good Times advertising costs were $475,000 (4.7% of total revenues) in the quarter ended June 30, 2026 compared to $382,000 (3.7% of total revenues) in the same prior year period. Good Times advertising costs consist primarily ofpromotional campaigns on third-party delivery platforms, social media and agency fees. Advertising costs are presented as gross, with franchisee contributions to the fund being recognized as a component of franchise revenues.

Previous wording

Impairment of Long-lived Assets and ROU Assets. There were $227,000 of costs associated with impairments for the quarter ended March 31, 2026. There were $494,000 of impairment costs for the quarter ended April 1, 2025. The current quarter impairment costs are attributable to the temporary closure of one Good Times restaurant. Impairment costs in the prior year quarter relate to the impairment of lease right-of-use assets and new assets deployed in restaurants where impairment was previously assessed, and the Company’s current analysis indicated impairment of assets associated with those restaurants.

Current wording

Impairment of Long-Lived Assets and ROU Assets. There were $18,000 of costs associated with impairments for the quarter ended June 30, 2026. There were no impairment costs for the quarter ended July 1, 2025. The current quarter impairment costs relate to the right-of-use asset for a Bad Daddy’s location destroyed in a casualty event.

Previous wording

Loss (Gain) on Asset Disposals. The net loss on asset disposals for the fiscal quarter ended March 31, 2026 was $85,000, which is composed of a loss of $88,000 on disposal of miscellaneous assets, and $3,000 of deferred gain recognition, compared to a net loss of $6,000 for the fiscal quarter ended April 1, 2025. The net loss in the prior year fiscal quarter was primarily due to disposal of miscellaneous assets, partially offset by deferred gain recognition.

Current wording

Gain on Lease Terminations and Asset Disposals. The net gain on lease terminations and asset disposals for the fiscal quarter ended June 30, 2026 was $489,000, which includes a gain on lease terminations of $587,000, $3,000 of deferred gain recognition, and a loss of $101,000 on asset disposals, inclusive of the assets disposed resulting from lease terminations. The net gain in the prior year fiscal quarter was $4,000, which was composed of a $13,000 gain on lease termination, $3,000 of deferred gain recognition, and a loss of $12,000 on disposal of miscellaneous assets.

Previous wording

Income (Loss) from Operations. Income from operations was $172,000 in the quarter ended March 31, 2026 compared to a loss of $514,000 in the quarter ended April 1, 2025.

Current wording

Income from Operations. Income from operations was $1,767,000 in the quarter ended June 30, 2026 compared to income from operations of $1,233,000 in the quarter ended July 1, 2025.

Previous wording

The change in the income (loss) from operations for the quarter ended March 31, 2026 from the quarter ended April 1, 2025 is primarily attributable to matters discussed in the relevant sections above.

Current wording

The change from the quarter ended July 1, 2025 to the quarter ended June 30, 2026 was primarily due to matters discussed in the relevant sections above.

Previous wording

*Interest Expense.*Interest expense was $36,000 during the quarter ended March 31, 2026 compared with $56,000 during the quarter ended April 1, 2025.

Current wording

*Interest Expense.*Interest expense was $24,000 during the quarter ended June 30, 2026, compared with $51,000 during the quarter ended July 1, 2025.

Previous wording

Provision for Income Taxes. There was a $23,000 benefit from income taxes for the quarter ended March 31, 2026, compared to $57,000 of expense for the quarter ended April 1, 2025.

Current wording

Provision for Income Taxes. There was a $212,000 benefit from income taxes for the quarter ended June 30, 2026, compared to a $363,000 benefit for the quarter ended July 1, 2025.

Previous wording

For the quarter ended March 31, 2026, the income attributable to non-controlling interests was $10,000 compared to a loss of $3,000 for the quarter ended April 1, 2025. The $13,000 increase is due to increased profitability of the restaurants involved in the limited partnership with a non-controlling partner.

Current wording

For the quarter ended June 30, 2026, the income attributable to non-controlling interests was $48,000 compared to $58,000 for the quarter ended July 1, 2025. This $10,000 decrease is due to decreased profitability of the restaurants involved in the limited partnership with a non-controlling partner.

Previous wording

Fiscal two quarters ended March 31, 2026 (26 weeks) compared to fiscal two quarters ended April 1, 2025 (27 weeks):

Current wording

Fiscal three quarters ended June 30, 2026 (39 weeks) compared to fiscal three quarters ended July 1, 2025 (40 weeks):

Previous wording

*Net Revenues.*Net revenues for the two quarters ended March 31, 2026 decreased $4,674,000, or 6.6%, to $65,938,000 from $70,612,000 for the two quarters ended April 1, 2025. Bad Daddy’s concept revenues decreased $3,823,000 and our Good Times concept revenues decreased $851,000.

Current wording

*Net Revenues.*Net revenues for the three quarters ended June 30, 2026 decreased $6,532,000, or 6.1%, to $101,105,000 from $107,637,000 for the three quarters ended July 1, 2025. Bad Daddy’s concept revenues decreased $5,458,000 and our Good Times concept revenues decreased $1,074,000.

Previous wording

Bad Daddy’s restaurant sales decreased $3,772,000 to $47,123,000 for the two quarters ended March 31, 2026 from $50,895,000 for the two quarters ended April 1, 2025. This decrease is due to an additional week in the prior year period versus the current year period, the fourth fiscal quarter 2025 closure of one Bad Daddy’s restaurant, the first fiscal quarter 2026 closure of one Bad Daddy’s restaurant and decreased guest traffic, partially offset by menu price increases. The average menu price increase for the two quarters ended March 31, 2026 over the same prior year quarters was approximately 1.0%.

Current wording

Bad Daddy’s restaurant sales decreased $5,397,000 to $72,011,000 for the three quarters ended June 30, 2026 from $77,408,000 for the three quarters ended July 1, 2025. This decrease is due to an additional week in the prior year period versus the current year period, fewer restaurant operating weeks due to reduced number of operating restaurants and decreased guest traffic, partially offset by menu price increases. The average menu price increase for the three quarters ended June 30, 2026 over the same prior year quarters was approximately 1.9%.

Previous wording

Good Times restaurant sales decreased $836,000 to $18,374,000 for the two quarters ended March 31, 2026 from $19,210,000 for the two quarters ended April 1, 2025. This decrease is due to an additional week in the prior year period versus the current year period and the current quarter temporary closure of one Good Times restaurant, partially offset by increases in menu price. The average menu price increase for the two quarters ended March 31, 2026 over the same prior year quarters was approximately 0.9%.

Current wording

Good Times restaurant sales decreased $1,060,000 to $28,506,000 for the three quarters ended June 30, 2026 from $29,566,000 for the three quarters ended July 1, 2025. This decrease is due to an additional week in the prior year period versus the current year period and the second fiscal quarter 2026 temporary closure of one Good Times restaurant, partially offset by increases in menu price. The average menu price increase for the three quarters ended June 30, 2026 over the same prior year quarters was approximately 1.2%.

Previous wording

Franchise and other revenues decreased $66,000 to $441,000 in the two quarters ended March 31, 2026 compared to $507,000 in the two quarters ended April 1, 2025. This decrease is primarily due to lower license and royalty fees as well as a decrease in gift card breakage.

Current wording

Franchise and other revenues decreased $75,000 to $588,000 in the three quarters ended June 30, 2026 compared to $663,000 in the three quarters ended July 1, 2025. This decrease is due to lower license and royalty fees as well as a decrease in gift card breakage.

Previous wording

Bad Daddy’s same store restaurant sales decreased 1.0% during the two quarters ended March 31, 2026 compared to the same two quarters ended April 1, 2025, primarily driven by discounts provided through included sides and drink specials along with a decrease in demand across the sector for alcoholic beverages, as well as reduced customer traffic, partially offset by menu price increases. There were thirty-seven restaurants included in the same store sales base at the end of the current quarter.

Current wording

Bad Daddy’s same store restaurant sales decreased 1.5% during the three quarters ended June 30, 2026 compared to the same three quarters ended July 1, 2025, primarily driven by discounts provided through included sides and drink specials along with a decrease in demand across the sector for alcoholic beverages, and reduced customer traffic, partially offset by menu price increases. There were thirty-six restaurants included in the same store sales base at the end of the current quarter.