Company Overview

Biglari Holdings Inc. is a holding company that owns subsidiaries in various industries like restaurants, insurance, oil and gas, and media licensing. The company is led by CEO Sardar Biglari, who makes major investment decisions.

Financial Highlights

• Net earnings for Q1 2024 were $22.6 million compared to $65.5 million in Q1 2023
• Operating business earnings were $4.1 million in Q1 2024 versus $6.6 million in Q1 2023
  
• Investment gains were $21.3 million in Q1 2024 compared to $75.5 million in Q1 2023

Restaurant Operations

The restaurant businesses include Steak n Shake and Western Sizzlin, comprising 485 company and franchise units.

• Steak n Shake same-store sales grew 9.9% in Q1 2024
• Net sales rose to $38.7 million from $36.9 million in Q1 2023
• 15 company-operated Steak n Shake locations were temporarily closed in Q1 2024
• Earnings before income taxes were $4.9 million versus $7.8 million in Q1 2023

Cost Management

• Cost of food was 28.3% of net sales in Q1 2024 and 2023
  
• Labor costs were 32.1% of net sales in Q1 2024 versus 31.4% in Q1 2023
• G&A costs rose due to more personnel and higher salaries/wages

Insurance Operations

The insurance businesses are First Guard and Southern Pioneer.

• Underwriting profit was $0.9 million compared to $1.8 million in Q1 2023
  
• Investment income rose to $0.9 million from $0.6 million
• Earnings before income taxes totaled $2.2 million versus $2.8 million in Q1 2023

First Guard

• Maintained underwriting profit despite higher loss ratio
• Loss ratio rose to 72.8% from 58.9% in Q1 2023

Southern Pioneer

• Returned to underwriting profitability
• Expense ratio improved from prior year

Oil and Gas

• Earnings before income taxes were $1.5 million compared to $2.1 million in Q1 2023
• Lower natural gas prices and production decreased revenues
  
• Gain on sale of properties was $0.5 million

Brand Licensing

• Maxim licensing revenues fell to $0.2 million from $0.6 million in Q1 2023
• Lower licensing events led to revenue decline

Investments

• Investment gains were $1.3 million in Q1 2024 versus $2.9 million
  
• Investment partnership gains totaled $22 million compared to $72.6 million in Q1 2023

Financial Condition

• Cash and investments were $677 million, with $324 million related to company stock
• Cash from operations was $19.1 million in Q1 2024
• Available credit facilities total $30.5 million

Outlook

Despite lower earnings in Q1 2024, the company maintains a healthy financial position. Restaurant operations are strengthening, while insurance underwriting has been profitable. Volatility in investment returns continues to impact overall results. Management appears positioned to generate shareholder value over the long term.