Exhibit 99.1

Franchise Group, Inc. ANNOUNCEs first quarter fiscal year 2023 FINANCIAL RESULTS

Delaware, Ohio, May 10, 2023 (GLOBE NEWSWIRE) -- Franchise Group, Inc. (NASDAQ: FRG) (“Franchise Group,” “FRG” or the “Company”) today announced the financial results for its fiscal first quarter ended April 1, 2023. For the first quarter of fiscal 2023, total reported revenue for Franchise Group was approximately $1.1 billion, net loss from operations was approximately $108.3 million or $3.16 per fully diluted share, Adjusted EBITDA was approximately $66.0 million and Non-GAAP EPS was $0.11 per share. On April 1, 2023, total cash on hand was approximately $98.3 million and outstanding term debt was approximately $1.4 billion.

The Board of Directors approved a quarterly dividend of $0.46875 per share to the Company’s Series A Cumulative Perpetual Preferred stockholders. The cash dividend will be paid on or about July 17, 2023 to holders of record of the Company’s Series A preferred stock on the close of business on July 3, 2023. FRG management was unable to recommend that the Board of Directors declare a regular quarterly common stock dividend this quarter due to restrictions in FRG’s credit agreements. FRG’s credit agreements permit dividends so long as the Company’s leverage ratio remains below a specified level, and the Company is currently in excess of this level.

The Company currently has six reportable segments: American Freight; The Vitamin Shoppe; Pet Supplies Plus; Buddy’s; Sylvan; and Badcock.

The following table summarizes Revenue, Adjusted EBITDA, and Net Income/(Loss) for each of these segments. Reconciliations of Adjusted EBITDA, Non-GAAP Net Income and Non-GAAP EPS to their respective most comparable GAAP measures, are included below under “Non-GAAP Financial Measures and Key Metrics.”

	For the Three Months Ended
	April 1, 2023
			Adjusted			Net
	Revenue		EBITDA			Income/(Loss)
	(In thousands)
American Freight	$	236,561	$	(7,542	)	$	(93,859	)
Vitamin Shoppe		321,702		35,120			11,892
Pet Supplies Plus		334,071		29,625			7,759
Buddy's		14,968		4,507			1,724
Sylvan Learning		10,232		3,338			(121	)
Badcock		187,287		4,306			(27,188	)
Corporate		-		(3,354	)		(8,524	)
Total	$	1,104,821	$	66,000		$	(108,317	)

Outlook

In light of today’s announcement and our first quarter results, Franchise Group is withdrawing its previous financial outlook for 2023.

Conference Call Information

In light of today’s announcement, Franchise Group will conduct a conference call later this morning at 8:30 A.M. ET to discuss its business and financial results for the fiscal 2023 first quarter. A real-time webcast of the conference call will be available on the Events page of Franchise Group’s website at www.franchisegrp.com. Dial in access is also accessible through the link on the website. Please register 5-10 minutes prior to the scheduled start time.

About Franchise Group, Inc.

Franchise Group is an owner and operator of franchised and franchisable businesses that continually looks to grow its portfolio of brands while utilizing its operating and capital allocation philosophy to generate strong cash flow for its shareholders. Franchise Group’s business lines include Pet Supplies Plus, American Freight, The Vitamin Shoppe, Badcock Home Furniture & more, Buddy’s Home Furnishings, Sylvan Learning and Wag N Wash. On a combined basis, Franchise Group currently operates over 3,000 locations predominantly located in the U.S. that are either Company-run or operated pursuant to franchising and dealer agreements.

FRANCHISE GROUP, INC. AND SUBSIDIARIES

Consolidated Balance Sheets 

(In thousands, except share count and per share data)	April 1, 2023			December 31, 2022
	(Unaudited)			(Unaudited)
Assets
Current assets:
Cash and cash equivalents	$	98,266		$	80,783
Current receivables, net of allowance for credit losses of $(3,038) and $(4,106), respectively		151,723			170,162
Current securitized receivables, net of allowance for credit losses of $(71,148) and $(57,095), respectively		290,367			292,913
Inventories, net		759,891			736,841
Current assets held for sale		7,633			8,528
Other current assets		29,610			27,272
Total current assets		1,337,490			1,316,499
Property, plant, and equipment, net		234,705			223,718
Non-current receivables, net of allowance for credit losses of $(1,064) and $(892), respectively		11,202			11,735
Non-current securitized receivables, net of allowance for credit losses of $(9,418) and $(7,705), respectively		38,437			39,527
Goodwill		663,466			737,402
Intangible assets, net		114,000			116,799
Tradenames		222,703			222,703
Operating lease right-of-use assets		910,269			890,949
Investment in equity securities		9,758			11,587
Other non-current assets		65,232			59,493
Total assets	$	3,607,262		$	3,630,412
Liabilities and Stockholders’ Equity
Current liabilities:
Current installments of long-term obligations, net	$	11,771		$	6,935
Current installments of debt secured by accounts receivable, net		412,862			340,021
Current operating lease liabilities		179,246			179,519
Accounts payable and accrued expenses		415,665			376,895
Other current liabilities		40,983			40,541
Total current liabilities		1,060,527			943,911
Long-term obligations, excluding current installments		1,394,320			1,374,479
Non-current installments of debt secured by accounts receivable, net		68,163			107,448
Non-current operating lease liabilities		741,174			720,474
Other non-current liabilities		65,431			62,720
Total liabilities		3,329,615			3,209,032
Stockholders’ equity:
Common stock, $0.01 par value per share, 180,000,000 shares authorized, 35,148,564 and 34,925,733 shares issued and outstanding at April 1, 2023 and December 31, 2022, respectively		351			349
Preferred stock, $0.01 par value per share, 20,000,000 shares authorized and 4,541,125 issued and outstanding at April 1, 2023 and December 31, 2022		45			45
Additional paid-in capital		310,160			311,069
Retained earnings		(32,909	)		109,917
Total equity		277,647			421,380
Total liabilities and equity	$	3,607,262		$	3,630,412

FRANCHISE GROUP, INC. AND SUBSIDIARIES

Consolidated Statements of Operations         

	Three Months Ended
(In thousands, except share count and per share data)	April 1, 2023			March 26, 2022
	(Unaudited)			(Unaudited)
Revenues:
Product	$	976,808		$	979,164
Service and other		120,567			148,282
Rental		7,446			8,024
Total revenues		1,104,821			1,135,470
Operating expenses:
Cost of revenue:
Product		656,904			616,585
Service and other		9,579			8,663
Rental		2,626			2,861
Total cost of revenue		669,109			628,109
Selling, general, and administrative expenses		387,241			376,995
Goodwill impairment		75,000			-
Total operating expenses		1,131,350			1,005,104
Income from operations		(26,529	)		130,366
Other expense:
Bargain purchase gain		-			(67	)
Other		(1,834	)		(21,977	)
Interest expense, net		(87,129	)		(92,327	)
Income (loss) before income taxes		(115,492	)		15,995
Income tax expense (benefit)		(7,175	)		3,678
Income (loss) attributable to Franchise Group, Inc.	$	(108,317	)	$	12,317
Net income (loss) per share:
Basic	$	(3.16	)	$	0.25
Diluted		(3.16	)		0.25
Weighted-average shares outstanding:
Basic		35,002,174			40,307,412
Diluted		35,002,174			41,107,793

FRANCHISE GROUP, INC. AND SUBSIDIARIES

Consolidated Statements of Cash Flows       

	Three Months Ended
(In thousands)	April 1, 2023			March 26, 2022
	(Unaudited)			(Unaudited)
Operating Activities
Net income (loss)	$	(108,317	)	$	12,317
Adjustments to reconcile net income to net cash provided by operating activities:
Provision for credit losses for accounts receivable		20,327			15,103
Depreciation, amortization, and impairment charges		21,851			22,033
Goodwill impairment		75,000			-
Amortization of deferred financing costs		2,830			6,379
Securitized financing costs		27,000			29,801
Stock-based compensation expense		2,719			5,447
Change in fair value of investment		1,830			23,723
Gain on bargain purchases and sales of Company-owned stores		-			(2,206	)
Other non-cash items		(42	)		(2,227	)
Changes in other assets and liabilities		(23,511	)		(101,227	)
Net cash provided by operating activities		19,687			9,143
Investing Activities
Purchases of property, plant, and equipment		(14,219	)		(9,752	)
Proceeds from sale of property, plant, and equipment		1,166			2,554
Acquisition of business, net of cash and restricted cash acquired		(3,682	)		(3,930	)
Net cash (used in) investing activities		(16,735	)		(11,128	)
Financing Activities
Dividends paid		(25,698	)		(27,315	)
Issuance of long-term debt and other obligations		415,000			67,000
Repayment of long-term debt and other obligations		(387,585	)		(182,096	)
Proceeds from secured debt obligations		132,151			57,358
Repayment of secured debt obligations		(97,210	)		(55,096	)
Principal payments of finance lease obligations		(1,207	)		(768	)
Payment for debt issue costs		(17,393	)		-
Cash paid for exercises/vesting of stock-based compensation, net		(3,626	)		(215	)
Net cash provided by (used in) financing activities		14,432			(141,132	)
Net increase (decrease) in cash equivalents and restricted cash		17,384			(143,117	)
Cash, cash equivalents and restricted cash at beginning of period		81,250			292,714
Cash, cash equivalents and restricted cash at end of period	$	98,634		$	149,597
Supplemental Cash Flow Disclosure
Cash paid for taxes, net of refunds	$	1,562		$	274
Cash paid for interest		30,841			21,424
Cash paid for interest on secured debt		23,757			16,830
Accrued capital expenditures		2,229			3,177
Capital expenditures funded by finance lease liabilities		12,741			-

Non-GAAP Financial Measures and Key Metrics

Adjusted EBITDA, Non-GAAP Net Income and Non-GAAP EPS are financial measures that are not prepared in accordance with GAAP. Management believes the presentation of these measures is useful to investors as supplemental measures in evaluating the aggregate performance of the Company’s operating businesses and in comparing its results from period to period because they exclude items that the Company does not believe are reflective of its core or ongoing operating results. These measures are used by management to evaluate the Company’s performance and make resource allocation decisions each period. These metrics are also used in the determination of executive management's compensation. Adjusted EBITDA, Non-GAAP Net Income and Non-GAAP EPS should not be considered in isolation or as a substitute for net income or other income statement information prepared in accordance with GAAP and our presentation of these non-GAAP measures may not be comparable to similarly titled measures used by other companies.

Management defines and calculates Adjusted EBITDA as net income (loss) from continuing operations before interest, income taxes, depreciation and amortization adjusted for certain non-core or non-operational items related to executive severance and related costs, stock-based compensation, shareholder litigation costs, corporate governance costs, accrued judgments and settlements, net of estimated revenue, store closures, rebranding costs, acquisition costs, inventory fair value step up amortization and prepayment penalty on early debt repayment. Adjusted EBITDA is a financial measure that is not prepared in accordance with GAAP.

Management defines and calculates Non-GAAP Net Income and Non-GAAP EPS as net income (loss) and net income (loss) per diluted share from continuing operations adjusted for non-core or non-operational items related to executive severance and related costs, stock-based compensation, non-cash executive compensation expense, shareholder litigation costs, prepayment penalties on early debt repayment, non-cash amortization of debt issuance costs, store closures, the Badcock segment’s in-house financing operations, rebranding costs, acquisition costs, inventory fair value step up amortization, and amortization of acquired intangible assets. Although amortization of acquired intangible assets is excluded from these non-GAAP measures, it is important for investors to understand that such intangible assets support revenue generation. Management excludes amortization of intangible assets because these are non-cash amounts for which the amount and frequency are significantly impacted by the timing and size of our acquisitions, which vary from period to periods and across companies. The tax effect on the related non-GAAP adjustments was calculated based on an estimated annual non-GAAP effective tax rate of 25.8%.

Reconciliation of Adjusted EBITDA

Below is the reconciliation of Net Income/(Loss) from continuing operations to Adjusted EBITDA for the three months ended April 1, 2023.

	For the Three Months Ended April 1, 2023
($ In thousands)	Buddy's		Pet Supplies Plus			American Freight			Vitamin Shoppe		Sylvan			Badcock			Corporate			Total
Net income (loss)	$	1,724	$	7,759		$	(93,859	)	$	11,892	$	(121	)	$	(27,188	)	$	(8,524	)	$	(108,317	)
Add back:
Interest expense		1,417		8,286			13,592			11,172		1,227			51,374			61			87,129
Income tax expense (benefit)		599		3,321			(6,363	)		4,131		42			(9,444	)		539			(7,175	)
Depreciation and amortization charges		767		7,704			3,265			6,694		2,107			1,077			10			21,624
Total Adjustments		2,783		19,311			10,494			21,997		3,376			43,007			610			101,578
EBITDA		4,507		27,070			(83,365	)		33,889		3,255			15,819			(7,914	)		(6,739	)
Adjustments to EBITDA
Executive severance and related costs		-		(6	)		390			1,185		-			-			-			1,569
Litigation costs and settlements		-		-			40			46		7			-			-			94
Stock-based and long term executive compensation		-		1,688			(34	)		-		76			-			2,719			4,450
Corporate compliance costs		-		-			-			-		-			-			(4	)		(4	)
Store closures		-		-			18			-		-			-			-			18
Securitized accounts receivable interest income		-		-			-			-		-			(30,584	)		-			(30,584	)
Securitized accounts receivable allowance for credit losses		-		-			-			-		-			21,995			-			21,995
W.S. Badcock financing operations		-		-			-			-		-			(3,122	)		-			(3,121	)
Right-of-use asset and long-term asset impairment		-		135			409			-		-			-			-			544
Goodwill impairment		-		-			75,000			-		-			-			-			75,000
Integration costs		-		637			-			-		-			-			12			649
Divestiture costs		-		-			-			-		-			198			-			198
Acquisition costs		-		101			-			-		-			-			-			101
Loss on investment in equity securities		-		-			-			-		-			-			1,830			1,830
Acquisition bargain purchase gain		-		-			-			-		-			-			-			-
Total Adjustments to EBITDA		-		2,555			75,823			1,231		83			(11,513	)		4,557			72,739
Adjusted EBITDA	$	4,507	$	29,625		$	(7,542	)	$	35,120	$	3,338		$	4,306		$	(3,357	)	$	66,000

Reconciliation of Non-GAAP Net Income and EPS

Below is the reconciliation of Net Income/(Loss) from continuing operations to Non-GAAP Net Income and Net Income/(Loss) from continuing operations per diluted share to Non-GAAP EPS for the three months ended April 1, 2023.

	For the Three Months Ended
($ In thousands except share count and per share data)	April 1, 2023
Net income (loss) / Net income (loss) per diluted share	$	(108,317	)		(3.09	)
Less: Preferred dividend declared		(2,128	)		(0.06	)
Adjusted Net Income available to Common Stockholder		(110,446	)		(3.16	)
Add back:
Executive severance and related costs		1,569			0.04
Litigation costs and settlements		94			-
Stock-based and long term executive compensation		4,450			0.13
Corporate compliance costs		(4	)		-
Store closures		18			-
Securitized accounts receivable interest income		(30,584	)		(0.87	)
Securitized accounts receivable allowance for credit losses		21,995			0.63
W.S. Badcock financing operations		(3,121	)		(0.09	)
Right-of-use asset and long-term asset impairment		544			0.02
Goodwill impairment		75,000			2.14
Integration costs		649			0.02
Divestiture costs		198			0.01
Acquisition costs		101			-
Loss on investment in equity securities		1,830			0.05
Acquisition bargain purchase gain		-			-
Adjustments to EBITDA		72,739			2.08
Non-cash amortization of debt issuance costs		2,830			0.08
Amortization of acquisition-related intangibles		4,367			0.12
Securitized receivables interest expense		48,125			1.38
Tax impact		(13,678	)		(0.39	)
Impact of diluted share count assuming non-GAAP net income		-			-
Total Adjustments to Net income (loss)		114,383			3.27
Non-GAAP Net Income / Non-GAAP diluted EPS	$	3,937		$	0.11
Basic weighted average shares					35,002,174
Non-GAAP diluted weighted average shares outstanding					35,002,174

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include, without limitation, projections, predictions, expectations, or beliefs about future events or results and are not statements of historical fact. Such statements may include statements regarding the Company’s results of operation and financial condition. Such forward-looking statements are based on various assumptions as of the time they are made, and are inherently subject to known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Forward-looking statements are often accompanied by words that convey projected future events or outcomes such as “expect,” “believe,” “estimate,” “plan,” “project,” “anticipate,” “intend,” “will,” “may,” “view,” “opportunity,” “potential,” or words of similar meaning or other statements concerning opinions or judgment of the Company or its management about future events. Although the Company believes that its expectations with respect to forward-looking statements are based upon reasonable assumptions within the bounds of its existing knowledge of its business and operations, there can be no assurance that actual results, performance, or achievements of the Company or matters pertaining to the proposed merger will not differ materially from any projected future results, performance, achievements or other matters expressed or implied by such forward-looking statements. Actual future results, performance, achievements or other matters may differ materially from historical results or those anticipated depending on a variety of factors, many of which are beyond the control of the Company. The Company refers you to the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of the Company’s Form 10-K for the fiscal year ended December 31, 2022, and comparable sections of the Company’s Quarterly Reports on Form 10-Q and other filings, which have been filed with the SEC and are available on the SEC’s website at www.sec.gov. All of the forward-looking statements made in this press release are expressly qualified by the cautionary statements contained or referred to herein. The actual results or developments anticipated may not be realized or, even if substantially realized, they may not have the expected consequences to or effects on the Company or its business or operations. Readers are cautioned not to rely on the forward-looking statements contained in this press release. Forward-looking statements speak only as of the date they are made and the Company does not undertake any obligation to update, revise or clarify these forward-looking statements, whether as a result of new information, future events or otherwise.

Investor Relations & Media Contact:

Andrew F. Kaminsky

EVP & Chief Administrative Officer

Franchise Group, Inc.

akaminsky@franchisegrp.com

(914) 939-5161