Shake Shack Announces Third Quarter 2022 Financial Results

• Total revenue of $227.8 million, up 17.5% versus 2021, including $219.5 million of Shack sales and $8.3 million of Licensing revenue.
• System-wide sales of $353.2 million, up 18.3% versus 2021.
• Same-Shack sales up 6.3% versus 2021.
• Operating loss of $4.8 million.
  • Shack-level operating profit⁽¹⁾ of $35.8 million, or 16.3% of Shack sales.
• Net loss of $2.3 million.
  • Adjusted EBITDA⁽¹⁾ of $19.5 million.
• Net loss attributable to Shake Shack Inc. of $2.0 million, or a loss of $0.05 per share.
  • Adjusted pro forma net loss⁽¹⁾ of $2.3 million, or a loss of $0.06 per fully exchanged and diluted share.
• Opened 2 new domestic Company-operated Shacks. Opened 6 new licensed Shacks, including locations in China and Korea.

NEW YORK--(BUSINESS WIRE)--Shake Shack Inc. (“Shake Shack” or the “Company”) (NYSE: SHAK) has posted its results for the third quarter of 2022 in a Shareholder Letter in the Quarterly Results section of the Company's Investor Relations website, which can be found here: Q3 2022 Shake Shack Shareholder Letter.

Shake Shack will host a conference call at 8:00 a.m. ET. Hosting the call will be Randy Garutti, Chief Executive Officer, and Katherine Fogertey, Chief Financial Officer. The conference call can be accessed live over the phone by dialing [phone], or for international callers by dialing [phone]. A replay of the call will be available until November 10, 2022 by dialing [phone] or for international callers by dialing [phone]; the passcode is 13732788.

The live audio webcast of the conference call will be accessible in the Events & Presentations section of the Company's Investor Relations website at investor.shakeshack.com. An archived replay of the webcast will also be available shortly after the live event has concluded.

(1)

Shack-level operating profit, Adjusted EBITDA and Adjusted pro forma net income (loss) are non-GAAP measures. A reconciliation to the most directly comparable financial measures presented in accordance with GAAP is set forth in the schedules accompanying this release. See “Non-GAAP Financial Measures” below.

About Shake Shack

Shake Shack serves elevated versions of American classics using only the best ingredients. It’s known for its delicious made-to-order Angus beef burgers, crispy chicken, hand-spun milkshakes, house-made lemonades, beer, wine, and more. With its high-quality food at a great value, warm hospitality, and a commitment to crafting uplifting experiences, Shake Shack quickly became a cult-brand with widespread appeal. Shake Shack’s purpose is to Stand For Something Good®, from its premium ingredients and employee development, to its inspiring designs and deep community investment. Since the original Shack opened in 2004 in NYC’s Madison Square Park, the Company has expanded to over 400 locations system-wide, including over 260 in 32 U.S. States and the District of Columbia, and over 140 international locations across London, Hong Kong, Shanghai, Singapore, Mexico City, Istanbul, Dubai, Tokyo, Seoul and more.

Skip the line with the Shack App, a mobile ordering app that lets you save time by ordering ahead! Guests can select their location, pick their food, choose a pickup time and their meal will be cooked-to-order and timed to arrival. Available on iOS and Android.

Definitions

The following definitions apply to these terms as used in this release:

"Shack sales" is defined as the aggregate sales of food, beverages, gift card breakage income and Shake Shack branded merchandise at domestic Company-operated Shacks and excludes sales from licensed Shacks.

“System-wide sales” is an operating measure and consists of sales from the Company's domestic Company-operated Shacks, domestic licensed Shacks and international licensed Shacks. The Company does not recognize the sales from licensed Shacks as revenue. Of these amounts, revenue is limited to licensing revenue based on a percentage of sales from domestic and international licensed Shacks, as well as certain up-front fees, such as territory fees and opening fees.

"Same-Shack sales" represents Shack sales for the comparable Shack base, which is defined as the number of domestic Company-operated Shacks open for 24 full fiscal months or longer. For consecutive days that Shacks were temporarily closed, the comparative period was also adjusted.

"Shack-level operating profit," a non-GAAP measure, is defined as Shack sales less Shack-level operating expenses including Food and paper costs, Labor and related expenses, Other operating expenses and Occupancy and related expenses.

"Shack-level operating profit margin," a non-GAAP measure, is defined as Shack sales less Shack-level operating expenses including Food and paper costs, Labor and related expenses, Other operating expenses and Occupancy and related expenses as a percentage of Shack sales.

“EBITDA,” a non-GAAP measure, is defined as Net income (loss) before interest expense (net of interest income), Income tax expense (benefit), and Depreciation and amortization expense.

“Adjusted EBITDA,” a non-GAAP measure, is defined as EBITDA (as defined above), excluding equity-based compensation expense, deferred lease costs, Impairment and loss on disposal of assets, amortization of cloud-based software implementation costs, as well as certain non-recurring items that the Company does not believe directly reflect its core operations and may not be indicative of the Company's recurring business operations.

"Adjusted pro forma net income," a non-GAAP measure, represents Net income (loss) attributable to Shake Shack Inc. assuming the full exchange of all outstanding SSE Holdings, LLC membership interests ("LLC Interests") for shares of Class A common stock, adjusted for certain non-recurring and other items that the Company does not believe directly reflect its core operations and may not be indicative of the Company's recurring business operations.

SHAKE SHACK INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
(in thousands, except share and per share amounts)
	September 28 2022			December 29 2021
ASSETS
Current assets:
Cash and cash equivalents	$	256,998		$	302,406
Marketable securities		80,015			80,000
Accounts receivable, net		11,800			13,657
Inventories		3,996			3,850
Prepaid expenses and other current assets		14,246			9,763
Total current assets		367,055			409,676
Property and equipment, net of accumulated depreciation of $271,938 and $222,768, respectively		441,870			389,386
Operating lease assets		370,536			347,277
Deferred income taxes, net		306,976			298,668
Other assets		15,330			12,563
TOTAL ASSETS	$	1,501,767		$	1,457,570
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	17,210		$	19,947
Accrued expenses		49,387			36,892
Accrued wages and related liabilities		17,758			14,638
Operating lease liabilities, current		40,690			35,519
Other current liabilities		19,497			14,501
Total current liabilities		144,542			121,497
Long-term debt		244,328			243,542
Long-term operating lease liabilities		429,165			400,113
Liabilities under tax receivable agreement, net of current portion		234,892			234,045
Other long-term liabilities		20,588			22,773
Total liabilities		1,073,515			1,021,970
Commitments and contingencies
Stockholders' equity:
Preferred stock, no par value—10,000,000 shares authorized; none issued and outstanding as of September 28, 2022 and December 29, 2021.		—			—
Class A common stock, $0.001 par value—200,000,000 shares authorized; 39,279,699 and 39,142,397 shares issued and outstanding as of September 28, 2022 and December 29, 2021, respectively.		39			39
Class B common stock, $0.001 par value—35,000,000 shares authorized; 2,869,513 and 2,921,587 shares issued and outstanding as of September 28, 2022 and December 29, 2021, respectively.		3			3
Additional paid-in capital		413,274			405,940
Retained earnings (accumulated deficit)		(9,820	)		3,554
Accumulated other comprehensive income (loss)		(1	)		1
Total stockholders' equity attributable to Shake Shack Inc.		403,495			409,537
Non-controlling interests		24,757			26,063
Total equity		428,252			435,600
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	1,501,767		$	1,457,570

SHAKE SHACK INC.
CONSOLIDATED STATEMENTS OF INCOME (LOSS)
(UNAUDITED)
(in thousands, except per share amounts)
	Thirteen Weeks Ended										Thirty-Nine Weeks Ended
	September 28 2022					September 29 2021					September 28 2022					September 29 2021
Shack sales	$	219,501		96.4	%	$	186,972		96.4	%	$	639,346		96.6	%	$	519,110		96.7	%
Licensing revenue		8,313		3.6	%		6,923		3.6	%		22,611		3.4	%		17,527		3.3	%
TOTAL REVENUE		227,814		100.0	%		193,895		100.0	%		661,957		100.0	%		536,637		100.0	%
Shack-level operating expenses^(1):
Food and paper costs		67,774		30.9	%		57,925		31.0	%		193,645		30.3	%		157,472		30.3	%
Labor and related expenses		64,638		29.4	%		58,208		31.1	%		190,954		29.9	%		157,221		30.3	%
Other operating expenses		33,966		15.5	%		26,613		14.2	%		96,766		15.1	%		74,032		14.3	%
Occupancy and related expenses		17,337		7.9	%		14,640		7.8	%		50,270		7.9	%		43,427		8.4	%
General and administrative expenses		26,645		11.7	%		20,504		10.6	%		87,040		13.1	%		60,435		11.3	%
Depreciation and amortization expense		18,647		8.2	%		15,183		7.8	%		53,589		8.1	%		43,381		8.1	%
Pre-opening costs		3,041		1.3	%		2,933		1.5	%		8,576		1.3	%		8,767		1.6	%
Impairment and loss on disposal of assets		592		0.3	%		535		0.3	%		1,697		0.3	%		1,262		0.2	%
TOTAL EXPENSES		232,640		102.1	%		196,541		101.4	%		682,537		103.1	%		545,997		101.7	%
LOSS FROM OPERATIONS		(4,826	)	(2.1	)%		(2,646	)	(1.4	)%		(20,580	)	(3.1	)%		(9,360	)	(1.7	)%
Other income, net		1,482		0.7	%		18		—	%		1,731		0.3	%		157		—	%
Interest expense		(475	)	(0.2	)%		(350	)	(0.2	)%		(1,145	)	(0.2	)%		(1,224	)	(0.2	)%
LOSS BEFORE INCOME TAXES		(3,819	)	(1.7	)%		(2,978	)	(1.5	)%		(19,994	)	(3.0	)%		(10,427	)	(1.9	)%
Benefit from income taxes		(1,508	)	(0.7	)%		(576	)	(0.3	)%		(5,098	)	(0.8	)%		(10,665	)	(2.0	)%
NET INCOME (LOSS)		(2,311	)	(1.0	)%		(2,402	)	(1.2	)%		(14,896	)	(2.3	)%		238		—	%
Less: Net loss attributable to non-controlling interests		(287	)	(0.1	)%		(224	)	(0.1	)%		(1,522	)	(0.2	)%		(837	)	(0.2	)%
NET INCOME (LOSS) ATTRIBUTABLE TO SHAKE SHACK INC.	$	(2,024	)	(0.9	)%	$	(2,178	)	(1.1	)%	$	(13,374	)	(2.0	)%	$	1,075		0.2	%
Earnings (loss) per share of Class A common stock:
Basic	$	(0.05	)			$	(0.06	)			$	(0.34	)			$	0.03
Diluted	$	(0.05	)			$	(0.06	)			$	(0.34	)			$	0.01
Weighted average shares of Class A common stock outstanding:
Basic		39,274					39,137					39,221					39,066
Diluted		39,274					39,137					39,221					43,448

___________________
(1)	As a percentage of Shack sales.

SHAKE SHACK INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(in thousands)
	Thirty-Nine Weeks Ended
	September 28 2022			September 29 2021
OPERATING ACTIVITIES
Net income (loss) (including amounts attributable to non-controlling interests)	$	(14,896	)	$	238
Adjustments to reconcile net income (loss) to net cash provided by operating activities
Depreciation and amortization expense		53,589			43,381
Amortization of debt issuance costs		786			605
Amortization of cloud computing asset		1,080			935
Non-cash operating lease cost		43,159			37,213
Equity-based compensation		10,155			5,963
Deferred income taxes		12,215			9,708
Loss on sale of marketable securities		—			5
Non-cash interest expense		181			348
Impairment and loss on disposal of assets		1,697			1,262
Unrealized loss on equity securities		400			117
Other non-cash income		(2	)		(2	)
Changes in operating assets and liabilities:
Accounts receivable		1,840			(1,847	)
Inventories		(146	)		(637	)
Prepaid expenses and other current assets		(4,767	)		4,233
Other assets		(5,966	)		(767	)
Accounts payable		(2,069	)		(6,780	)
Accrued expenses		(17,783	)		(18,682	)
Accrued wages and related liabilities		3,052			3,709
Other current liabilities		4,376			(2,202	)
Long-term operating lease liabilities		(32,558	)		(31,886	)
Other long-term liabilities		(10	)		(1,174	)
NET CASH PROVIDED BY OPERATING ACTIVITIES		54,333			43,740
INVESTING ACTIVITIES
Purchases of property and equipment		(94,797	)		(68,852	)
Purchases of marketable securities		(415	)		(47,321	)
Sales of marketable securities		—			4,004
NET CASH USED IN INVESTING ACTIVITIES		(95,212	)		(112,169	)
FINANCING ACTIVITIES
Proceeds from issuance of convertible notes, net of discount		—			243,750
Deferred financing costs		—			(123	)
Payments on principal of finance leases		(2,260	)		(1,982	)
Distributions paid to non-controlling interest holders		(389	)		(878	)
Debt issuance costs		—			(968	)
Proceeds from stock option exercises		334			6,688
Employee withholding taxes related to net settled equity awards		(2,214	)		(3,510	)
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES		(4,529	)		242,977
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS		(45,408	)		174,548
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD		302,406			146,873
CASH AND CASH EQUIVALENTS AT END OF PERIOD	$	256,998		$	321,421

SHAKE SHACK INC.
NON-GAAP FINANCIAL MEASURES
(UNAUDITED)

To supplement the consolidated financial statements, which are prepared and presented in accordance with U.S. generally accepted accounting principles (“GAAP”), the Company uses the following non-GAAP financial measures: Shack-level operating profit, Shack-level operating profit margin, EBITDA, adjusted EBITDA, adjusted EBITDA margin, adjusted pro forma net income (loss) and adjusted pro forma earnings (loss) per fully exchanged and diluted share (collectively the "non-GAAP financial measures").

Shack-Level Operating Profit

Shack-level operating profit is defined as Shack sales less Shack-level operating expenses including Food and paper costs, Labor and related expenses, Other operating expenses and Occupancy and related expenses.

How This Measure Is Useful

When used in conjunction with GAAP financial measures, Shack-level operating profit and Shack-level operating profit margin are supplemental measures of operating performance that the Company believes are useful measures to evaluate the performance and profitability of its Shacks. Additionally, Shack-level operating profit and Shack-level operating profit margin are key metrics used internally by management to develop internal budgets and forecasts, as well as assess the performance of its Shacks relative to budget and against prior periods. It is also used to evaluate employee compensation as it serves as a metric in certain performance-based employee bonus arrangements. The Company believes presentation of Shack-level operating profit and Shack-level operating profit margin provides investors with a supplemental view of its operating performance that can provide meaningful insights to the underlying operating performance of the Shacks, as these measures depict the operating results that are directly impacted by the Shacks and exclude items that may not be indicative of, or are unrelated to, the ongoing operations of the Shacks. It may also assist investors to evaluate the Company's performance relative to peers of various sizes and maturities and provides greater transparency with respect to how management evaluates the business, as well as the financial and operational decision-making.

Limitations of the Usefulness of this Measure

Shack-level operating profit and Shack-level operating profit margin may differ from similarly titled measures used by other companies due to different methods of calculation. Presentation of Shack-level operating profit and Shack-level operating profit margin is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. Shack-level operating profit excludes certain costs, such as General and administrative expenses and Pre-opening costs, which are considered normal, recurring cash operating expenses and are essential to support the operation and development of the Company's Shacks. Therefore, this measure may not provide a complete understanding of the Company's operating results as a whole and Shack-level operating profit and Shack-level operating profit margin should be reviewed in conjunction with the Company's GAAP financial results. A reconciliation of Shack-level operating profit to Loss from Operations, the most directly comparable GAAP financial measure, is set forth below.

	Thirteen Weeks Ended						Thirty-Nine Weeks Ended
(dollar amounts in thousands)	September 28 2022			September 29 2021			September 28 2022			September 29 2021
Loss from operations	$	(4,826	)	$	(2,646	)	$	(20,580	)	$	(9,360	)
Less:
Licensing revenue		8,313			6,923			22,611			17,527
Add:
General and administrative expenses		26,645			20,504			87,040			60,435
Depreciation and amortization expense		18,647			15,183			53,589			43,381
Pre-opening costs		3,041			2,933			8,576			8,767
Impairment and loss on disposal of assets		592			535			1,697			1,262
Shack-level operating profit	$	35,786		$	29,586		$	107,711		$	86,958
Total revenue	$	227,814		$	193,895		$	661,957		$	536,637
Less: Licensing revenue		8,313			6,923			22,611			17,527
Shack sales	$	219,501		$	186,972		$	639,346		$	519,110
Shack-level operating profit margin^(1,2)		16.3	%		15.8	%		16.8	%		16.8	%

___________________
(1)	As a percentage of Shack sales.
(2)	For the thirty-nine weeks ended September 28, 2022, Shack-level operating profit margin includes the $1,281 cumulative catch-up adjustment for gift card breakage income, recognized in Shack sales.

SHAKE SHACK INC.
NON-GAAP FINANCIAL MEASURES
(UNAUDITED)

EBITDA and Adjusted EBITDA

EBITDA is defined as Net income (loss) before interest expense (net of interest income), Income tax expense (benefit) and Depreciation and amortization expense. Adjusted EBITDA is defined as EBITDA (as defined above) excluding equity-based compensation expense, deferred lease costs, Impairment and loss on the disposal of assets, amortization of cloud-based software implementation costs, as well as certain non-recurring items that the Company does not believe directly reflect its core operations and may not be indicative of the Company's recurring business operations.

How These Measures Are Useful

When used in conjunction with GAAP financial measures, EBITDA and adjusted EBITDA are supplemental measures of operating performance that the Company believes are useful measures to facilitate comparisons to historical performance and competitors' operating results. Adjusted EBITDA is a key metric used internally by management to develop internal budgets and forecasts and also serves as a metric in its performance-based equity incentive programs and certain bonus arrangements. The Company believes presentation of EBITDA and adjusted EBITDA provides investors with a supplemental view of the Company's operating performance that facilitates analysis and comparisons of its ongoing business operations because they exclude items that may not be indicative of the Company's ongoing operating performance.

Limitations of the Usefulness of These Measures

EBITDA and adjusted EBITDA may differ from similarly titled measures used by other companies due to different methods of calculation. Presentation of EBITDA and adjusted EBITDA is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. EBITDA and adjusted EBITDA exclude certain normal recurring expenses. Therefore, these measures may not provide a complete understanding of the Company's performance and should be reviewed in conjunction with the GAAP financial measures. A reconciliation of EBITDA and adjusted EBITDA to Net income (loss) the most directly comparable GAAP measure, is as follows.

	Thirteen Weeks Ended						Thirty-Nine Weeks Ended
(dollar amounts in thousands)	September 28 2022			September 29 2021			September 28 2022			September 29 2021
Net income (loss)	$	(2,311	)	$	(2,402	)	$	(14,896	)	$	238
Depreciation and amortization expense		18,647			15,183			53,589			43,381
Interest expense, net		475			350			1,145			1,224
Benefit from income taxes		(1,508	)		(576	)		(5,098	)		(10,665	)
EBITDA		15,303			12,555			34,740			34,178
Equity-based compensation		3,515			2,324			10,155			5,963
Amortization of cloud-based software implementation costs		397			308			1,080			935
Deferred lease costs^(1)		(258	)		108			(1,908	)		237
Impairment and loss on disposal of assets		592			535			1,697			1,262
Legal matters		—			—			6,750			619
Gift card breakage cumulative catch-up adjustment		—			—			(1,281	)		—
Debt offering related costs^(2)		—			—			—			236
Executive transition costs		—			—			—			179
Adjusted EBITDA	$	19,549		$	15,830		$	51,233		$	43,609
Adjusted EBITDA margin^(3)		8.6	%		8.2	%		7.7	%		8.1	%

___________________
(1)	Reflects the extent to which lease expense is greater than or less than contractual fixed base rent.
(2)	Costs incurred in connection with the Company’s Convertible Notes, issued in March 2021, including consulting and advisory fees.
(3)	Calculated as a percentage of Total revenue, which was $227.8 million and $662.0 million for the thirteen and thirty-nine weeks ended September 28, 2022, respectively, and $193.9 million and $536.6 million for the thirteen and thirty-nine weeks ended September 29, 2021, respectively.

Adjusted Pro Forma Net Income (Loss) and Adjusted Pro Forma Earnings (Loss) Per Fully Exchanged and Diluted Share

Adjusted pro forma net income (loss) represents Net income (loss) attributable to Shake Shack Inc. assuming the full exchange of all outstanding SSE Holdings, LLC membership interests ("LLC Interests") for shares of Class A common stock, adjusted for certain non-recurring items that the Company does not believe are directly related to its core operations and may not be indicative of recurring business operations. Adjusted pro forma earnings (loss) per fully exchanged and diluted share is calculated by dividing adjusted pro forma net income (loss) by the weighted-average shares of Class A common stock outstanding, assuming the full exchange of all outstanding LLC Interests, after giving effect to the dilutive effect of outstanding equity-based awards.

How These Measures Are Useful

When used in conjunction with GAAP financial measures, adjusted pro forma net income (loss) and adjusted pro forma earnings (loss) per fully exchanged and diluted share are supplemental measures of operating performance that the Company believes are useful measures to evaluate performance period over period and relative to its competitors. By assuming the full exchange of all outstanding LLC Interests, the Company believes these measures facilitate comparisons with other companies that have different organizational and tax structures, as well as comparisons period over period because it eliminates the effect of any changes in Net income (loss) attributable to Shake Shack Inc. driven by increases in its ownership of SSE Holdings, which are unrelated to the Company's operating performance, and excludes items that are non-recurring or may not be indicative of ongoing operating performance.

Limitations of the Usefulness of These Measures

Adjusted pro forma net income (loss) and adjusted pro forma earnings (loss) per fully exchanged and diluted share may differ from similarly titled measures used by other companies due to different methods of calculation. Presentation of adjusted pro forma net income (loss) and adjusted pro forma earnings (loss) per fully exchanged and diluted share should not be considered alternatives to Net income (loss) and earnings (loss) per share, as determined under GAAP. While these measures are useful in evaluating the Company's performance, it does not account for the earnings attributable to the non-controlling interest holders and therefore does not provide a complete understanding of the Net income (loss) attributable to Shake Shack Inc. Adjusted pro forma net income (loss) and adjusted pro forma earnings (loss) per fully exchanged and diluted share should be evaluated in conjunction with GAAP financial results. A reconciliation of adjusted pro forma net income (loss) to Net income (loss) attributable to Shake Shack Inc., the most directly comparable GAAP measure, and the computation of adjusted pro forma earnings (loss) per fully exchanged and diluted share are set forth below.

	Thirteen Weeks Ended						Thirty-Nine Weeks Ended
(in thousands, except per share amounts)	September 28 2022			September 29 2021			September 28 2022			September 29 2021
Numerator:
Net income (loss) attributable to Shake Shack Inc.	$	(2,024	)	$	(2,178	)	$	(13,374	)	$	1,075
Adjustments:
Reallocation of Net loss attributable to non-controlling interests from the assumed exchange of LLC Interests^(1)		(287	)		(224	)		(1,522	)		(837	)
Legal matters		—			—			6,750			619
Gift card breakage cumulative catch-up adjustment		—			—			(1,281	)		—
Debt offering related costs^(2)		—			—			—			236
Executive transition costs		—			—			—			179
Revolving Credit Facility amendments related costs^(3)		—			—			—			323
Impact to income tax expense (benefit)^(4)		(11	)		392			(922	)		528
Adjusted pro forma net income (loss)	$	(2,322	)	$	(2,010	)	$	(10,349	)	$	2,123
Denominator:
Weighted average shares of Class A common stock outstanding—diluted		39,274			39,137			39,221			43,448
Adjustments:
Assumed exchange of LLC Interests for shares of Class A common stock^(1)		2,871			2,922			2,899			—
Adjusted pro forma fully exchanged weighted average shares of Class A common stock outstanding—diluted		42,145			42,059			42,120			43,448
Adjusted pro forma earnings (loss) per fully exchanged share—diluted	$	(0.06	)	$	(0.05	)	$	(0.25	)	$	0.05

	Thirteen Weeks Ended						Thirty-Nine Weeks Ended
	September 28 2022			September 29 2021			September 28 2022			September 29 2021
Earnings (loss) per share of Class A common stock—diluted	$	(0.05	)	$	(0.06	)	$	(0.34	)	$	0.01
Assumed exchange of LLC Interests for shares of Class A common stock^(1)		—			—			(0.01	)		—
Non-GAAP adjustments^(5)		(0.01	)		0.01			0.10			0.04
Adjusted pro forma earnings (loss) per fully exchanged share—diluted	$	(0.06	)	$	(0.05	)	$	(0.25	)	$	0.05

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(1)	Assumes the exchange of all outstanding LLC Interests for shares of Class A common stock, resulting in the elimination of the non-controlling interest and recognition of the net income (loss) attributable to non-controlling interests.
(2)	Costs incurred in connection with the Company’s Convertible Notes, issued in March 2021, including consulting and advisory fees.
(3)	Expense incurred in connection with the Company's amendments on the Revolving Credit Facility, including the write-off of previously capitalized costs on the Revolving Credit Facility.
(4)	Represents the tax effect of the aforementioned adjustments and pro forma adjustments to reflect corporate income taxes at assumed effective tax rates of 39.2% and 28.8% for the thirteen and thirty-nine weeks ended September 28, 2022, respectively, and 32.5% and 123.4% for the thirteen and thirty-nine weeks ended September 29, 2021, respectively. Amounts include provisions for U.S. federal income taxes, certain LLC entity-level taxes and foreign withholding taxes, assuming the highest statutory rates apportioned to each applicable state, local and foreign jurisdiction.
(5)	Represents the per share impact of non-GAAP adjustments for each period. Refer to the reconciliation of Adjusted Pro Forma Net Income (Loss) above, for additional information.