The ONE Group — Third Quarter 2026 Earnings Summary

Financial Performance:

• Total GAAP revenues for the quarter were $177.0 million, a decrease of 1.8% from $180.2 million in the same quarter of 2025; the decline included $4.5 million (2.5%) attributable to permanent and temporary closures within the Grill Concepts portfolio, partially offset by revenue from new restaurants opened since Q3 2025.
• Consolidated comparable sales decreased 0.4% year-over-year, while consolidated comparable transactions increased 1.8%.
• Benihana brand comparable sales increased 0.7% and comparable transactions increased 2.7%.
• Net cash provided by operating activities increased 50% to $8.8 million for the quarter, compared to $5.9 million in the prior year period; year-to-date net cash from operations increased $24.6 million to $41.8 million from $17.2 million.
• Restaurant operating profit margin expanded 190 basis points to 13.2% of owned restaurant net revenue, up from 11.3% in the prior year period.
• GAAP operating income year-to-date increased $11.1 million to $14.6 million from $3.5 million.
• Adjusted EBITDA attributable to The ONE Group Hospitality, Inc. increased 5% to $11.1 million for the quarter from $10.6 million; year-to-date Adjusted EBITDA increased 3% to $60.8 million from $59.1 million.
• Total owned operating expenses as a percentage of owned restaurant net revenue were 86.8% for the quarter, down from 88.7% in the prior year period.
• Interest expense, net of interest income, was $10.0 million for the quarter and $29.4 million year-to-date.

Guidance and Future Outlook:

• The Company updated its full-year 2026 financial targets to reflect a focus on expanding free cash flow, reduced capital expenditures, portfolio optimization, and operational improvements.
• Full-year 2026 Total GAAP revenue guidance is $800 to $810 million.
• Full-year 2026 Consolidated comparable sales guidance is +1%.
• Full-year 2026 Managed, license, and franchise fee revenues guidance is $13 to $14 million.
• Full-year 2026 Consolidated Adjusted EBITDA guidance is $95 to $100 million.
• Full-year 2026 Consolidated total capital expenditures guidance is approximately $30 to $34 million.
• Full-year 2026 Consolidated number of new system-wide venues guidance is 6 to 8 new venues.
• Management anticipates entering the seasonally strongest quarter with improving transaction trends and a strong portfolio position.

Business Segments and Product Lines:

• The Company is executing a portfolio optimization strategy converting select Kona Grill and RA locations into Benihana and STK restaurants.
• Currently, the Company operates 20 Kona Grills and 12 RAs, inclusive of temporarily closed restaurants.
• Four temporarily closed Kona Grills and three temporarily closed RAs are awaiting conversion to Benihana locations.
• Year-to-date, the Company re-opened the Riverton, Utah location as a Benihana and the Baltimore, Maryland location as a remodeled small footprint Kona Grill and a new STK.
• The Company exited one RA (Phoenix, Arizona) and two Kona Grills (Cincinnati, Ohio and Huntsville, Alabama) due to lease expirations.
• Conversion economics are approximately $1.0 to $1.5 million net per conversion with an expected short payback.
• The Benihana Express prototype is pacing at an annual volume of $1.8 million, with two company prototypes open in Miami and Denver.
• Two additional Benihana Express locations are expected to open in 2026: a licensed location in Islamorada, Florida, and an owned location in Topanga Mall, Canoga Park, California.
• New company-owned openings are targeting average build-out costs of $1.5 million or less.

Market and Competitive Landscape:

• Transactions have been positive for two consecutive quarters and have improved sequentially for three quarters, indicating guest demand for differentiated dining experiences despite a cautious consumer environment.
• Grill Concepts comparable transactions were positive 1.7% for the quarter and 1.4% year-to-date.
• The Company is prioritizing asset-light growth through franchising and licensing opportunities.
• The Benihana Express concept targets a premium fast-casual opportunity with 800-1,000 square foot spaces and projected combined food and labor costs of 45% to 50%.

Risks and Challenges:

• Forward-looking statements include risks related to the ability to integrate new or acquired restaurants without operational disruption.
• Risks include the ability to capture anticipated synergies and the ability to open new restaurants and manage growth profitably.
• Factors beyond control affecting restaurant openings include weather conditions, landlord/contractor actions, and regulatory or licensing authority approvals.
• Potential impacts from economic downturns, changes in immigration policies leading to labor shortages, and the imposition of tariffs affecting food prices and inflation.
• Risks related to development and franchise partners and international conflicts impacting macroeconomic conditions.

Management Commentary and Tone:

• Emanuel "Manny" Hilario, President and CEO, stated that results demonstrate meaningful progress in strengthening financial performance, delivering positive transaction growth, and expanding restaurant-level margins.
• Management highlighted the effectiveness of operational initiatives, the strength of differentiated brands, and disciplined execution of strategic priorities.
• Hilario noted that the distinctiveness of Vibe Dining brands is resonating with guests and that the beef strategy, supply chain initiatives, and menu optimization drove the 190-basis point improvement in restaurant operating profit margin.
• Management emphasized translating operational improvements into stronger cash flow through enhanced profitability, disciplined capital allocation, and continued portfolio optimization.
• The tone reflects confidence in the Benihana Express prototype's unit economics and the pipeline of high-quality licensees.

Other Key Points:

• The Board of Directors authorized an additional $5.0 million to the stock repurchase program on November 3, 2026.
• As of September 27, 2026, the Company had purchased 3.4 million shares for $19.3 million under the repurchase program.
• Total short-term liquidity as of September 27, 2026, was $40.3 million, comprised of $13.7 million in cash and short-term credit card receivables and $26.6 million available under the revolving credit facility.
• The credit facility has no financial covenants under current conditions.
• The Company transitioned from a calendar-based fiscal year to a 52/53-week fiscal year starting January 1, 2025.
• The Company eliminated auto-gratuities, which had no impact on net income or Adjusted EBITDA as the associated expense was also eliminated.
• The Company operates multiple brands including STK, Benihana, Samurai, Kona Grill, Salt Water Social, Benihana Express, RA, and ONE Hospitality.