The barbecue chain continues to shed company-run stores as it improves sales.

For the first time since the second quarter of 2016, Famous Dave’s is back in the green. The barbecue chain reported net income of $998,000 in the first quarter, or 13 cents per share, compared to net loss of $1.4 million, or 21 cents per share in the year-ago period.

Chief executive officer Jeff Crivello said in a statement that Famous Dave’s, “saw many of our previously announced initiatives come to fruition in the first quarter of fiscal 2018 as we returned to profitability and continued to see positive comparable sales at company-owned restaurants.”

The key change was a cutback in general and administrative expenses, which decreased to $1.9 million from $4.5 million in Q1 2017. The culprit: a result of the alignment of the chain’s G&A expense structure thanks to becoming a more dedicated franchisor, and lowering overhead as the company continues to reduce its corporate-owned restaurant count.

Famous Dave’s cut its corporate store number from 35 restaurants as of April 2, 2017 to 16 as of April 1, 2018. In that time period, Famous Dave’s total unit count declined to 152 from 173. The franchise count fell just two stores from 138 to 136. Broken down, this included 12 closures and seven company restaurants sold to franchisees.

Famous Dave’s franchise-run restaurants saw a 1.6 percent decline in same-store sales, year-over-year, in the quarter. Company-owned achieved a 5.2 percent lift.

Total revenue was $12.8 million, down 24.2 percent from Q1 2017, thanks mainly to the closure of those 12 company-owned restaurants. System sales fell 13 percent to $87.2 million.

Crivello said Famous Dave’s has further room to grow.

“We believe the continued adoption of third party delivery will help drive the top line performance of our franchisees throughout the year as only half of the serviceable units are currently live,” he said in a statement. “We look forward to focusing on strategic investments to enhance our brand and value proposition to current and prospective franchisees.”

Famous Dave’s unveiled in April a fresh look, complete with 23 new menu items curated by founder and barbecue hall of famer “Famous Dave” Anderson, as well as a smaller footprint prototype and investments in technology. A delivery-only store model is even in the works.

These changes will run alongside the brand’s continued push toward becoming a franchisor-focused operation. Famous Dave’s had 50 company-owned units in 2015.

Famous Dave’s introduced its smaller footprint design in January 2018 in El Paso, Texas. It showcases a lighter and more efficient back-of-the-house kitchen with a contemporary front-of-house design.

Third-party delivery is scheduled to rollout August at corporate locations, with franchise units following suit.

As for the delivery-only model, the company said these units would fit in 500– to 800-square spots compared to the typical 5,000-square foot footprint. It will allow for food preparation and quick delivery of the same items featured at full-service locations. Read more about the changes here.

Casual Dining, Chain Restaurants, Feature, Finance, Famous Dave's