The ONE Group Hospitality, Inc.

Greetings and welcome to the one group first quarter 2023 earnings conference call. At this time, all participants are in a listen-only mode. A brief question and answer session will follow the formal presentation. If you'd like to join the question queue, you can press star, then one. If you'd like to remove yourself from the question queue, press star, then two. Please also note this event is being recorded. And now I would like to turn the conference over to Tyler Loy.

Thank you, Operator, and hello, everyone. Before we begin our formal remarks, let me remind you that part of our discussion today will include forward-looking statements. These forward-looking statements are not guarantees of future performance, and you should not place undue reliance on them. These statements are also subject to numerous risks and uncertainties that could cause actual results to differ materially from what we expect. Please also note that these forward-looking statements reflect our opinion only as the date of this call. We undertake no obligation to revise or publicly release any revisions of these forward-looking statements in light of new information or future events. We refer you to our recent SEC filings for a more detailed discussion of the risks that could impact our future operating results and financial conditions. During today's call, we will discuss certain non-GAAP financial measures which we believe can be useful in evaluating our performance. However, the presentation of these measures or other information should not be considered in isolation or as a substitute for results prepared in accordance with GAAP. For reconciliations of these measures, such as adjusted EBITDA, adjusted net income, restaurant operating profit, comparable sales, and total food and beverage sales in owned and managed and licensed units to gap measures, along with the discussion of why we consider these measures useful. Please see our earnings relief issued today. With that, I'd like to turn the call over to Manny Hilario.

Thank you Tyler and hello everyone. We sincerely appreciate you joining us today and for your interest in the one group. Let me begin by thanking all of our team members for their hard work providing world-class operations as we build a strong portfolio of restaurants with industry-leading return on invested capital. Key highlights for the first quarter include total revenues growth of over 11% to 82.6 million, with a 1.6% increase in comparable sales. Best-in-class SDK restaurant-level margins of 22.1% and an increase in year-over-year adjusted EBITDA despite continued headwinds in inflation on a year-over-year basis. Consolidated cost of goods sold of 24%, driven by manual innovation and mix management, a flexible supply chain, and executing our margin and sales driving initiatives, such as toppings, sides, and beverage. Our newest SDK venues continue to significantly outperform our investment model and an average should have less than a one-year payback. And finally, we finished the quarter with $48.7 million in cash, which allow us to be flexible in returning value to our shareholders, including funding our rapidly expanding and robust pipeline of future restaurants. Our focus on strong operational execution, culinary innovation, and vibe dining continues to resonate with our guests, and we are on plan with our growth strategy. This quarter, we continue to see strength in our weekend and special occasion business, as well as strengthening demand for private events as more and more people return to offices around the country. This also coincides with the strength in our happy hour program at both brands, particularly with our three, six, and $9 price points, which we believe are some of the most compelling values in the industry. Importantly, our teams are converting the energy created by our happy hour guests into an active and vibrant dinner business. The continued strength in our underlying business along with the performance of our new restaurants gives us tremendous confidence in the revenue and profit power of our development pipeline. Despite a challenging construction environment, we have established an incredible pipeline of high-quality real estate development and plan to open eight to 12 new venues this year. Importantly, we have an established platform for scalable and long-term revenue and profit growth. We kicked off the year with the opening of a newly redesigned Kona Grill in Columbus, Ohio in the Eastern Town Center in January. This new unit performed above the system average and above our Kona Grill investment model for the quarter. We are encouraged by the start of this new restaurant and are looking forward to the patio season in Ohio. We also opened a new rooftop at the SDK in Scottsdale in February. This is the fourth domestic SDK rooftop in our portfolio and a great addition to our already strong Scottsdale location. For the remainder of the year, we plan to open two to four additional corner grills in the following cities. Riverton, Utah, Desert Ridge, Arizona, Henderson, Nevada, and Target, Oregon. And three to five new company-owned SDKs in the following cities, Charlotte, North Carolina, Boston, Massachusetts, Washington, D.C., Aventura, Florida, and South Lake City, Utah. And finally, we plan to open one managed or licensed SDK. As we have long stated, our growth story has just begun. We foresee a total addressable market of at least 400 restaurants, including 200 SDK restaurants globally and at least 200 corner grills domestically. To conclude, our team is doing a fantastic job by focusing on operations and day-to-day execution. We are executing our plan of strengthening our existing business and building our development pipeline to powerfully grow revenue in EBITDA to build significant and sustainable sharehold value over the long term. Now I'll turn the call over to Tyler.