UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): August 7, 2014

IGNITE RESTAURANT GROUP, INC.

(Exact name of registrant as specified in its charter)

Registrant’s telephone number, including area code: (713) 366-7500

Not Applicable

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

Item 2.02.     Results of Operations and Financial Condition.

On August 7, 2014, Ignite Restaurant Group, Inc. (the “Company”) issued a press release reporting financial results for the quarter ended June 30, 2014. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated by reference herein. In the press release, the Company used non-GAAP financial measures discussed in Appendix A hereto (incorporated herein by reference), which contains certain statements of the Company’s management regarding the use and purpose of the non-GAAP financial measures used therein.

The information contained in this Current Report on Form 8-K, including the Exhibit attached hereto, is being furnished and shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that Section. Furthermore, the information contained in this Current Report on Form 8-K shall not be deemed to be incorporated by reference into any registration statement or other document filed pursuant to the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such filing.

Item 9.01.     Financial Statements and Exhibits.

(d) Exhibits.

Signatures

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Date: August 7, 2014

APPENDIX A

Use of Non-GAAP Financial Measures

We occasionally utilize financial measures and terms not calculated in accordance with accounting principles generally accepted in the United States (“GAAP”) to evaluate our operating performance. These non-GAAP measures are provided to enhance the reader’s overall understanding of our current financial performance. These measurements are used by many investors as a supplemental measure to evaluate the overall operating performance of companies in our industry. Management believes that investors’ understanding of our performance is enhanced by including these non-GAAP financial measures as a reasonable basis for comparing our ongoing results of operations. Many investors are interested in understanding the performance of our business by comparing our results from ongoing operations from one period to the next and would ordinarily add back events that are not part of normal day-to-day operations of our business. Management and our principal stockholder also use such measures as measurements of operating performance, for planning purposes, and to evaluate the performance and effectiveness of our operational strategies.

These non-GAAP measures may not be comparable to similarly titled measures used by other companies and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP. We have provided a definition below for these non-GAAP financial measures, together with an explanation of why management uses these measures and why management believes that these non-GAAP financial measures are useful to investors. In addition, we have provided a reconciliation of these non-GAAP financial measures utilized to its equivalent GAAP financial measure.

Adjusted net income and adjusted net income per share

We calculate adjusted net income by eliminating from net income (loss) the impact of items we do not consider indicative of our ongoing operations. Specifically, we believe that this non-GAAP measure provides greater comparability and enhanced visibility into our results of operations, excluding the impact of special charges and certain other expenses. Adjusted net income represents net income (loss) less items such as (a) transaction costs including those related to our acquisition of Romano’s Macaroni Grill, (b) costs related to the preparation and filing of a registration statement for a proposed secondary offering of our common stock, (c) asset impairments and closures, (d) write-off of debt issuance costs, (e) non-recurring recruiting and training expenses related to increased restaurant-level staffing at our Macaroni Grill restaurants, (f) gain on insurance settlements, and (g) the income tax effect of the above described adjustments. We believe this measure provides additional information to facilitate the comparison of our past and present financial results. We utilize results that both include and exclude the identified items in evaluating business performance. However, our inclusion of this adjusted measure should not be construed as an indication that our future results will be unaffected by unusual or infrequent items. In the future, we may incur expenses or generate income similar to these adjustments.

Exhibit 99.1

For Immediate Release

Ignite Restaurant Group Reports Second Quarter 2014 Financial Results

Houston, TX—(BUSINESS WIRE)—August 7, 2014—Ignite Restaurant Group (NASDAQ: IRG) today reported financial results for the second quarter ended June 30, 2014.

Highlights for the second quarter of 2014 were as follows:

Ray Blanchette, Chief Executive Officer of Ignite Restaurant Group, stated, “Our second quarter results were challenged as we faced what we believe were residual effects of 2014’s winter weather, combined with some cannibalization of Joe’s Crab Shack sales as we significantly increased the number of locations in the Northeast over the past three years. Results at Macaroni Grill were generally in line with our internal expectations, however our team continues to focus on a robust pipeline of initiatives to drive sales growth and improve profitability. We remain pleased with the ongoing sales success at Brick House Tavern + Tap and with the improvements in store level execution. Our near-term development strategy is expected to provide further opportunities to expand the Brick House concept as we continue to optimize our real estate portfolio through conversions.”

Review of Second Quarter 2014 Operating Results

Total revenues were $229.8 million in the second quarter of 2014, an increase of 0.8% compared to $228.1 million in the second quarter of last year. The increase was largely driven by the inclusion of Macaroni Grill for the full 13 weeks of the second quarter of 2014, versus 12 weeks for the comparable period of 2013 and new restaurant development, partially offset by a 3.1% decrease in comparable restaurant sales.

Net income for the second quarter of 2014 was $1.8 million, or $0.07 per diluted share. The Company’s net income for the second quarter of 2014 included approximately $330,000 of costs related to three restaurant closures, losses on disposal of assets and transaction related costs. Excluding the impact of these items, adjusted net income and adjusted net income per diluted share (which are non-GAAP financial measures) were $2.0 million and $0.08, respectively, in the second quarter of 2014. Net loss for the second quarter of 2013 was $2.5 million, or a loss of $0.10 per diluted share. The Company incurred approximately $5.3 million of primarily acquisition related and labor related transition costs in connection with the acquisition of Romano's Macaroni Grill in the second quarter of 2013. Excluding the impact of these items, adjusted net income and adjusted net income per diluted share (which are non-GAAP financial measures) were $1.0 million and $0.04, respectively. A reconciliation between GAAP net income (loss) and adjusted net income is included in the accompanying financial data.

Development

During the second quarter of 2014, the Company closed three Macaroni Grill locations. Of these closures, one has been converted and re-opened as a Brick House Tavern + Tap and one is currently under construction and will re-open as a Brick House restaurant in the fourth quarter of 2014 or in early 2015. Subsequent to the end of the second quarter, three additional Macaroni Grill locations were closed in July for a total of eight Macaroni Grill closures year to date.

Liquidity

At June 30, 2014, the Company had approximately $20.4 million of available borrowing capacity under its current credit facility and was in compliance with the credit facility’s financial covenants. “In light of our desire to move quickly on new Brick House locations and the recent sales volatility in casual dining, we are currently reviewing refinancing alternatives of our existing credit facility,” stated Michael Dixon, President and Chief Financial Officer of Ignite Restaurant Group.

Conference Call

We will host a conference call to discuss our second quarter financial results today at 5:00 PM Eastern Standard Time. Hosting the call will be Ray Blanchette, Chief Executive Officer, and Michael Dixon, President and Chief Financial Officer. The conference call can be accessed live over the phone by dialing 877-852-6579 or for international callers by dialing 719-325-4794. A replay will be available one hour after the call and can be accessed by dialing 877-870-5176 or 858-384-5517 for international callers; the password is 1127123. The replay will be available until August 14, 2014. The call will also be webcast live from the Company's website at www.igniterestaurants.com under the “Investors” section.

About Ignite Restaurant Group

Ignite Restaurant Group, Inc. (NASDAQ: IRG) owns and operates over 300 restaurants throughout the U.S. Headquartered in Houston, Ignite's portfolio of restaurant concepts includes Joe's Crab Shack, Romano's Macaroni Grill and Brick House Tavern + Tap. Each brand offers a variety of high-quality, chef-inspired food and beverages in a distinctive, casual, high-energy atmosphere. The Company is also a franchisor for Macaroni Grill in locations in the U.S., U.S. territories and internationally. For more information on Ignite and its distinctive brands visit www.igniterestaurantgroup.com.

Cautionary Note Regarding Forward-Looking Statements

This press release includes “forward-looking statements” within the meaning of the federal securities laws. Forward-looking statements are subject to known and unknown risks and uncertainties, many of which may be beyond the Company’s control. The Company cautions you that the forward-looking information presented in this press release is not a guarantee of future events, and that actual events and results may differ materially from those made in or suggested by the forward-looking information contained in this press release. In addition, forward-looking statements generally can be identified by the use of forward-looking terminology such as “may,” “plan,” “seek,” “comfortable with,” “will,” “expect,” “intend,” “estimate,” “anticipate,” “believe” or “continue” or the negative thereof or variations thereon or similar terminology.

A number of important factors could cause actual events and results to differ materially from those contained in or implied by the forward-looking statements included in this press release, including the risk factors discussed in the Company’s Form 10-K for the year ended December 30, 2013 (which can be found at the SEC’s website www.sec.gov) and each such risk factor is specifically incorporated into this press release. Any forward-looking information presented herein is made only as of the date of this press release, and the Company does not undertake any obligation to update or revise any forward-looking information to reflect changes in assumptions, the occurrence of unanticipated events, or otherwise.

Results of Operations

The following tables present the consolidated statements of operations and selected other data for the thirteen and twenty-six weeks ended June 30, 2014 and July 1, 2013, and selected consolidated balance sheet information as of June 30, 2014 and December 30, 2013:

 

Consolidated Statements of Operations		Thirteen Weeks Ended June 30, 2014								Thirteen Weeks Ended July 1, 2013
		(In thousands, except percent and per share data)
Revenues		$	229,847				100.0	%		$	228,132				100.0	%
Costs and expenses
Restaurant operating costs and expenses
Cost of sales			70,722				30.8	%			66,765				29.3	%
Labor expenses			68,995				30.0	%			71,465				31.3	%
Occupancy expenses			19,577				8.5	%			18,896				8.3	%
Other operating expenses			47,454				20.6	%			48,039				21.1	%
General and administrative			11,202				4.9	%			16,611				7.3	%
Depreciation and amortization			7,945				3.5	%			7,356				3.2	%
Pre-opening costs			558				0.2	%			1,477				0.6	%
Asset impairments and closures			135				0.1	%			14				0.0	%
Loss on disposal of property and equipment			504				0.2	%			197				0.1	%
Total costs and expenses			227,092				98.8	%			230,820				101.2	%
Income (loss) from operations			2,755				1.2	%			(2,688	)			(1.2	)%
Interest expense, net			(1,765	)			(0.8	)%			(1,741	)			(0.8	)%
Income (loss) before income taxes			990				0.4	%			(4,429	)			(1.9	)%
Income tax benefit			(777	)			(0.3	)%			(1,967	)			(0.9	)%
Net income (loss)		$	1,767				0.8	%		$	(2,462	)			(1.1	)%
Basic and diluted net income (loss) per share data:
Net income (loss) per share
Basic and diluted		$	0.07							$	(0.10	)
Weighted average shares outstanding
Basic			25,651								25,624
Diluted			25,749								25,624

The Company provided detailed explanation of this non-GAAP financial measure, including a discussion of the usefulness and purpose of the measure, in its Form 8-K filed with the Securities and Exchange Commission on August 7, 2014.