ONE Group Hospitality, Inc. Files Definitive Proxy Statement

TL;DR

<b>ONE Group Hospitality achieved record revenue in 2023 and announced a significant acquisition of Benihana Inc.</b>

AI Summary

ONE Group Hospitality, Inc. (STKS) filed a Proxy Statement (DEF 14A) with the SEC on April 11, 2024. ONE Group Hospitality reported record revenue of $332.8 million in 2023, a 5.1% increase. Comparable sales decreased by 2.7%, offset by contributions from six new restaurant openings. Adjusted EBITDA reached over $40 million, with a $47 million run rate adjusted for new units. The company opened six new restaurants in 2023 (three STK, three Kona Grill) and plans 6-8 openings in 2024. ONE Group Hospitality entered an agreement to acquire Safflower Holdings Corp., parent of Benihana Inc. and RA Sushi.

Why It Matters

For investors and stakeholders tracking ONE Group Hospitality, Inc., this filing contains several important signals. The acquisition of Benihana Inc. and RA Sushi significantly diversifies ONE Group's portfolio and adds established experiential brands. Despite inflationary pressures impacting profitability, the company achieved record revenue and is pursuing aggressive unit growth and strategic acquisitions.

Risk Assessment

Risk Level: medium — ONE Group Hospitality, Inc. shows moderate risk based on this filing. The company faces medium risk due to inflationary pressures impacting operating profit and net income, as stated in the filing.

Analyst Insight

Investors should monitor the integration of the Benihana acquisition and the company's ability to manage costs amidst inflation.

Financial Highlights

revenue

332.8 million

revenue Growth

5.1%

Revenue Breakdown

Key Numbers

• 332.8 million — 2023 Revenue (Record revenue for the year)
• 5.1% — Revenue Growth (Year-over-year increase in revenue)
• -2.7% — Comparable Sales Decrease (Offset by new openings)
• 6 — New Restaurants Opened in 2023 (Includes STK and Kona Grill)
• Over $40 million — Adjusted EBITDA (2023) (Excluding run rate adjustment)
• $47 million — Adjusted EBITDA Run Rate (Adjusted for new units)
• 6-8 — Targeted New Openings (2024) (Includes managed and licensed)

Key Players & Entities

• ONE Group Hospitality, Inc. (company) — Filer name
• STKS (company) — Ticker symbol
• DEF 14A (regulator) — Filing type
• 20240411 (date) — Filing date
• Safflower Holdings Corp. (company) — Acquisition target parent company
• Benihana Inc. (company) — Acquisition target subsidiary
• RA Sushi (company) — Acquisition target subsidiary
• 332.8 million (dollar_amount) — 2023 revenue

FAQ

Risk Factors

• Inflationary Pressures [medium — financial]: Inflation outpaced price increases, putting pressure on restaurant operating profit, Adjusted EBITDA, and net income compared to the prior year.
• Comparable Sales Decrease [low — operational]: A comparable sales decrease of 2.7% was experienced, despite new restaurant openings contributing to overall revenue growth.

Key Dates

• 2024-04-11: Filing Date — Definitive Proxy Statement filed.
• 2024-03-26: Acquisition Agreement Announced — Agreement to acquire Safflower Holdings Corp. (parent of Benihana Inc. and RA Sushi).

Key Financial Figures

• $332.8 m — year for us. Revenues increased 5.1% to $332.8 million, attributable to contributions fr
• $40 million — objectives, finishing the year at over $40 million* in Adjusted EBITDA and a $47 million r
• $47 million — r $40 million* in Adjusted EBITDA and a $47 million run rate when adjusting for new units t
• $5 million — 024, our Board authorized an additional $5 million share repurchase to be added to the $15
• $15 million — ion share repurchase to be added to the $15 million in repurchases we concluded in 2023.

Filing Documents

• tm242804-1_def14a.htm (DEF 14A) — 674KB
• lg_theonegroup-bw.jpg (GRAPHIC) — 23KB
• px_24oneproxy1pg01-bwlr.jpg (GRAPHIC) — 388KB
• px_24oneproxy1pg02-bwlr.jpg (GRAPHIC) — 348KB
• sg_christihing-bw.jpg (GRAPHIC) — 9KB
• sg_emanuelmannyhilario-bw.jpg (GRAPHIC) — 15KB
• 0001104659-24-046369.txt (&nbsp;) — 1684KB

Executive Compensation

Executive Compensation Emanuel P. N. Hilario, Director and President and Chief Executive Officer Base Salary earnings Annual Incentive Cash Bonus Long Term Incentive Program Equity Grants Compensation Highlights Say-on-pay proposal approved by 78% of stockholders voting at the 2023 meeting Performance metrics aligned with business strategy and stockholder value creation Target compensation is risk-based on financial and non-financial performance measures CEO—60% at risk, based on financial and non-financial performance measures Average NEO—52% at risk, based on financial and non-financial performance measures Incentive compensation plan and practices include good corporate governance features such as: Recommended Senior Executive Management team goals are presented to the Compensation Committee by the CEO The Compensation Committee evaluates the recommended goals and approves Performance goals are established and weighted 75% to Company financial performance and 25% to individual performance goals No excise tax gross-up on executive severance plan Three-year minimum performance period for long-term incentive plan awards Independent compensation consultant Annual compensation risk assessment 4 IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE STOCKHOLDER MEETING TO BE HELD ON MAY 22, 2024 This proxy statement is available at http://www.togrp.com/proxy.html. To vote your shares, please follow the instructions on the Notice or proxy card. You can elect to receive future distributions of our proxy statements and annual reports to stockholders by electronic delivery by following the instructions contained on the proxy card. Additionally, you can find a copy of our Annual Report on Form 10-K, which includes our financial statements, for the fiscal year ended December 31, 2023, on the website of the Securities and Exchange Commission at www.sec.gov or under "SEC Filings" in the "Investor Relations" section

View Full Filing

View this DEF 14A filing on SEC EDGAR