Page 1

KURA REVOLVING SUSHI BAR 詞 Kura Sushi USA Announces Fiscal Second Quarter 2021 Financial Results April 13 , 2021 IRVINE , Calif . , April 13 , 2021 ( GLOBE NEWSWIRE ) -- Kura Sushi USA , Inc. ( " Kura Sushi " or the " Company " ) ( NASDAQ : KRUS ) , a technology- enabled Japanese restaurant concept , today provided a COVID - 19 business update and reported fiscal second quarter 2021 financial results for the period ended February 28 , 2021 . COVID - 19 Business Update As of February 28 , 2021 , the Company had 28 of its 30 restaurants open in some capacity : indoor dining , outdoor dining or takeout only . Due to changes in local guidelines for public activities , the Company increased certain restaurants ' operating capacities starting in March . As of today , the Company has all 31 restaurants , including one new opening in the fiscal third quarter , operating at indoor capacities of 25 % to 100 % , depending on local requirements . During the second quarter of 2021 , the Company borrowed $ 9.0 million on its revolver and as of February 28 , 2021 , the Company had cash , cash equivalents and restricted cash of $ 2.3 million and $ 12.0 million of debt . Subsequent to the end of the fiscal second quarter , the Company borrowed an additional $ 2.0 million and on April 9 , 2021 , the Company increased its revolving line of credit facility to $ 45 million from $ 35 million . As permitted under the Coronavirus Aid , Relief , and Economic Security Act ( the " CARES Act " ) , the Company recognized a $ 2.6 million employee retention credit during the fiscal second quarter ended February 28 , 2021 . Fiscal Second Quarter 2021 Highlights * • Total sales were $ 9.1 million compared to $ 19.4 million in the second quarter of 2020 ; . Operating loss was $ 3.8 million , compared to an operating loss of $ 0.2 million in the second quarter of 2020 ; • Net loss was $ 3.9 million , or ( $ 0.46 ) per diluted share , compared to net loss of $ 0.1 million , or ( $ 0.02 ) per diluted share , in the second quarter of 2020. Adjusted net loss * was $ 6.5 million , or ( $ 0.78 ) per diluted share , compared to adjusted net loss of $ 0.1 million or ( $ 0.02 ) per diluted share , in the second quarter of 2020 ; • Restaurant - level operating loss * was $ 1.3 million ; • Adjusted EBITDA * was ( $ 4.7 ) million ; and • Two new restaurants opened during the second quarter of 2021 . Adjusted net loss , Restaurant - level operating profit ( loss ) and Adjusted EBITDA are non - GAAP measures and are defined below under " Key Financial Definitions " . Please see the reconciliation of non - GAAP measures accompanying this release . See also " Non - GAAP Financial Measures " below . Hajime Uba , President and Chief Executive Officer of Kura Sushi , stated , " While our fiscal second quarter results were greatly impacted by the increased severity of COVID restrictions , we have been encouraged to see a rebound in sales , beginning in February with relaxed restrictions . Thanks to our team's resilience and hard work , our daily sales volumes in February , exclusive of the impact on our Texas restaurants from the winter storm , were among the best we've seen since entering the pandemic . Our momentum continued into March with the limited reopening of California dining rooms and the increase of Texas indoor dining capacity to 100 % , resulting in March revenue of $ 5.2 million , by far our strongest sales month since the pandemic began . While we are still operating in an uncertain environment , we believe there is a light at the end of the tunnel . With COVID cases continuing to decline and vaccines becoming more widely available , our team is ready for post - pandemic recovery and eager to capitalize on pent - up demand for the full Kura Experience . " Review of Fiscal Second Quarter 2021 Financial Results Total sales were $ 9.1 million compared to $ 19.4 million in the second quarter of 2020. Comparable restaurant sales decreased 60 % for the second quarter of 2021 . Food and beverage costs as a percentage of sales was 35.0 % compared to 31.5 % in the second quarter of 2020. The increase is primarily a result of inventory spoilage and geographical mix of sales towards Texas restaurants that have lower sushi plate prices . Labor and related costs as a percentage of sales decreased to 22.7 % from 31.7 % in the second quarter of 2020. The decrease is due to a $ 2.2 million employee retention credit recognized under the CARES Act extension . Excluding the credit , labor and related costs would have been 46.9 % . The increase was primarily due to the effect of lower sales and minimum staffing needed to operate our restaurants at reduced capacities . Occupancy and related expenses were consistent with the second quarter of 2020 at $ 1.6 million . Other costs as a percentage of sales increased to 22.6 % compared to 11.4 % in the second quarter of 2020. The increase was primarily due to fixed cost deleverage as a result of the decrease in sales . General and administrative expenses were $ 2.9 million compared to $ 2.8 million in the second quarter of 2020. Excluding the impact of the $ 0.4 million employee retention credit recognized under the CARES Act extension , general and administrative expenses would have been $ 3.3 million . This increase was primarily due to additional compensation - related expenses . As a percentage of sales , general and administrative expenses increased to 31.6 % compared to 14.4 % in the second quarter of 2020 . Operating loss was $ 3.8 million , compared to an operating loss of $ 0.2 million in the second quarter of 2020 .