Kona Grill Reports First Quarter 2012 Financial Results

8.7% Increase in Q1 Same-Store Sales Drives Diluted EPS of $0.13

Scottsdale, AZ  (RestaurantNews.com)  Kona Grill, Inc. (NASDAQ: KONA), an American grill and sushi bar, reported results for its first quarter ended March 31, 2012.

First Quarter 2012 Highlights vs. Year-Ago Quarter:

• Restaurant sales increased 8.6% to $24.2 million;
• Same-store sales increased 8.7%;
• Restaurant operating profit margin increased 480 basis points to 19.9%; and
• Net income of $1.2 million or $0.13 per share, compared to a net loss of $92,000 or $(0.01) per share.

“The momentum we gained last year rolled into the first quarter of 2012,” said Berke Bakay, president and CEO of Kona Grill. “The 8.7% same-store sales growth during the quarter represents our sixth consecutive quarter of positive same-store sales. More importantly, we were able to leverage these sales to drive a 19.9% operating margin, which we believe is in the top tier of our peer group.”

First Quarter 2012 Financial Results

Restaurant sales in the first quarter of 2012 increased 8.6% to $24.2 million, compared to $22.2 million in the first quarter of 2011. The sales improvement reflects an 8.7% increase in same-store sales, driven by 6.4% growth in guest traffic and higher average guest check. The 8.7% increase in same-store sales compares to a 7.8% increase in the fourth quarter of 2011 and a 7.6% increase in the first quarter a year ago.

Net income in the first quarter of 2012 was $1.2 million or $0.13 per share, compared to a net loss of $92,000 or $(0.01) per share in the year-ago quarter.

Financial Guidance

For the second quarter of 2012, the company expects restaurant sales of $24.7 million compared to $24.5 million for the second quarter of 2011. The company also expects net income of $1.25 million, or $0.14 per share, compared to net income of $0.8 million, or $0.08 per share for the second quarter of 2011.

Conference Call

The company will host a conference call to discuss these results today at 5:00 p.m. Eastern time.

Dial toll-free: 1-877-941-1427
Toll/international: 1-480-629-9664
Conference ID#: 4531949

The conference call will be broadcast simultaneously and available for replay via the Investor Relations section of the company’s website at www.konagrill.com.

Please call the conference telephone number 5-10 minutes prior to the start time. An operator will register your name and organization. If you have any difficulty connecting with the conference call, please contact Liolios Group at 1-949-574-3860.

A replay of the call will be available after 8:00 p.m. Eastern time on the same day until Wednesday, May 30, 2012.

Toll-free replay number: 1-877-870-5176
Toll/International replay number: 1-858-384-5517
Replay pin #: 4531949

About Kona Grill

Kona Grill (NASDAQ: KONA) features American favorites with an international influence and award-winning sushi in a casually elegant atmosphere. Kona Grill owns and operates 23 restaurants, guided by a passion for quality food and personal service. Restaurants are currently located in 16 states: Arizona (Chandler, Gilbert, Phoenix, Scottsdale); Colorado (Denver); Connecticut (Stamford); Florida (Tampa); Illinois (Lincolnshire, Oak Brook); Indiana (Carmel); Louisiana (Baton Rouge); Maryland (Baltimore); Michigan (Troy); Minnesota (Eden Prairie); Missouri (Kansas City); Nebraska (Omaha); New Jersey (Woodbridge); Nevada (Las Vegas); Texas (Austin, Dallas, Houston, San Antonio); Virginia (Richmond). For more information, visit www.konagrill.com.

Forward-Looking Statements

The financial guidance we provide for our second quarter 2012 results, statements about our beliefs regarding profits and stockholder value, and certain other statements contained in this press release are forward-looking. Forward-looking statements include statements regarding our expectations, beliefs, intentions, plans, objectives, goals, strategies, future events, or performance and underlying assumptions and other statements that are not purely historical. We have attempted to identify these statements by using forward-looking terminology such as “may,” “will,” “anticipates,” “expects,” “believes,” “intends,” “should,” or comparable terms. All forward-looking statements included in this press release are based on information available to us on the date of this release and we assume no obligation to update these forward-looking statements for any reason. These statements are subject to risks and uncertainties that could cause actual results to differ materially from those described in the statements. Investors are referred to the full discussion of risks and uncertainties associated with forward-looking statements and the discussion of risk factors contained in the company’s filings with the Securities and Exchange Commission.