The 2026 Penn Station Franchise Disclosure Document reports these 2025 results for all 317 franchised restaurants that operated for the full calendar year. EBITDA is the closest official unit-level earnings measure after each restaurant’s reported General Manager costs, but Item 19 does not separate owner-operated from manager-run units. It is not an owner salary, distribution, after-tax take-home amount, or cash remaining after financing and capital expenditures.
Data basis
Legal franchisor: Penn Station, Inc., an Ohio corporation. FDD: issued April 20, 2026. Item 19: reports Net Sales, Operating Income, General Manager costs, and EBITDA for 317 full-year franchised restaurants, plus separate and mixed-population tables. Formats: the mixed 318-unit population included 292 in-line and 26 freestanding restaurants. External benchmark: none is needed for the principal earnings answer because the current FDD directly reports EBITDA. Checked: July 16, 2026.
FDD citations: 2026 Penn Station FDD, cover; Item 1, p. 2; Item 19, pp. 62–71. No matching franchisor-hosted public copy of the 2026 FDD was verified, so FDD citations are presented in plain text.
The current Item 19 directly reports a defined earnings measure for every franchised restaurant that was open for all of 2025. Confidence is still bounded because the statements were unaudited, do not follow full GAAP presentation, and omit owner compensation, financing, depreciation, amortization, capital spending, and multi-unit overhead.
What does Penn Station’s FDD actually report?
Officially, Item 19 reports unit-level EBITDA rather than owner income. For the 317 franchised restaurants open throughout 2025, average EBITDA was $101,722, median EBITDA was $81,181, the highest result was $486,408, and the lowest was a loss of $83,083. Only 137 restaurants, or 43.22%, attained or exceeded the average EBITDA.
The FDD defines EBITDA as restaurant earnings before interest, income taxes, depreciation, and amortization. It also states that EBITDA does not deduct franchisee-owner salary, owner draw, owner benefits, automobile expense, owner meals and entertainment, remodeling costs, or multi-unit expenses. Therefore, EBITDA is a useful operating benchmark but not the same as the owner’s distributable cash or personal take-home pay.
$819,903 of average Net Sales produced $101,722 of average EBITDA
The gap consists of food and paper, crew labor, royalty, advertising, rent, delivery, technology, banking charges, utilities, maintenance, General Manager costs, and other restaurant expenses. The average revenue number should never be presented as an owner salary.
How widely did EBITDA vary by sales cohort?
Official 2025 average EBITDA rose from $4,365 in the bottom sales quartile to $231,117 in the top quartile; the bars also show cohort medians for 318 full-year units.
Interpretation: Sales cohort is the dominant disclosed earnings separator. The middle 50% had average EBITDA of $86,564, while the top 25% averaged $231,117 and the bottom 25% averaged only $4,365.
Source: 2026 Penn Station FDD, Item 19, pp. 66–71. Population: 318 restaurants open all of 2025, including 317 franchised restaurants and one company-owned restaurant. Cohorts are sales rankings, not probabilities or forecasts.
How does average revenue become average EBITDA?
The official 2025 average moves from $819,903 of Net Sales to $173,674 of Operating Income and then to $101,722 of EBITDA. The bridge below uses compatible average figures for the same 317 franchised restaurants. It groups disclosed line items only for readability and does not add an outside restaurant margin.
Average franchised-unit Net Sales to EBITDA
The official 2025 averages reconcile from $819,903 of Net Sales to $101,722 of EBITDA for 317 full-year franchised restaurants.
Interpretation: Average controllable costs were $375,007. Other operating overhead was $271,222 after grouping the disclosed advertising, promotion, occupancy, royalty, delivery, technology, banking, utilities, maintenance, insurance, and miscellaneous lines. General Manager and other below-operating-income costs reduced Operating Income by a net $71,952.
Source and calculation: 2026 Penn Station FDD, Item 19, p. 64. Controllable costs = Food and Paper + Wages + Payroll Taxes. Other operating overhead = Net Sales − controllable costs − Operating Income. GM and other costs, net = Operating Income − EBITDA. Figures are rounded only after calculation.
How can owner involvement change the result?
An active Managing Owner may capture some labor value otherwise paid to a General Manager, but the FDD does not publish separate owner-operated and manager-run cohorts. Penn Station’s Item 15 requires a full-time Managing Owner and, unless Penn Station authorizes a General Manager, the Managing Owner must personally supervise the first restaurant on premises. Once a second restaurant is under construction, Penn Station may require the Managing Owner to stop serving as a General Manager and hire a separate General Manager.
Independent owner-involvement sensitivity
The figures below are independent analytical cases, not an Item 19 financial performance representation by Penn Station, Inc. They combine official average EBITDA and General Manager cost lines with explicit assumptions about how much manager cost an owner can actually replace. Actual results can differ materially by location, format, sales, labor, occupancy, financing, owner involvement, and execution.
Owner-involvement sensitivity at the 2025 average
Capturing 0%, 50%, or 100% of the average General Manager cash cost produces $101,722, $137,338, or $172,953; the added amount is owner labor value, not passive business profit.
Interpretation: The FDD’s average General Manager salary, payroll tax, and health insurance total $71,231. Adding 0%, 50%, or 100% of that amount to average EBITDA produces the three cases. The $172,953 figure is an owner-operator benefit ceiling under the stated assumption, not pure business profit.
Formula: $101,722 average EBITDA + assumed avoided share of ($63,552 General Manager salary + $5,141 payroll tax + $2,538 health insurance). Sources: 2026 Penn Station FDD, Item 19, p. 64; Item 15, pp. 46–49. The model excludes any replacement labor, owner payroll, owner benefits, additional staffing, or operational deterioration.
- Reported-cost baseline: EBITDA reflects the General Manager cost each restaurant actually reported, but Item 19 does not identify which restaurants were owner-operated. It remains the cleaner official proxy for business earnings before financing, taxes, depreciation, amortization, owner compensation, and capital expenditures.
- Owner-operator benefit: any avoided General Manager expense compensates the owner for full-time operational labor. It should not be described as passive income.
- Multi-unit limitation: each restaurant must have a separate qualified General Manager when the franchisee owns more than one restaurant, and an Operations Director may be required at five or more units.
Which FDD fees materially affect annual earnings?
The 2026 FDD imposes a tiered monthly royalty and separate advertising obligations. These terms are official contractual obligations, while the Item 19 expense lines show what the 2025 reporting population actually recorded. A buyer should not subtract the fee percentages again from Item 19 EBITDA because the reported restaurant statements already include royalty and advertising expense lines.
| Recurring item | 2026 FDD term | 2025 Item 19 average | Earnings interpretation |
|---|---|---|---|
| Royalty | 0% to 8% of monthly Net Sales under the current tier schedule, with specified abatement rules. | $60,975 | Equal to 7.44% of compatible average Net Sales; already included in reported EBITDA. |
| National Fund | Currently 2% of monthly Net Sales; may increase to 4% on notice where the agreement permits. | Not isolated | Item 19 does not separately identify the National Fund within the advertising presentation. |
| Local Advertising | Up to 2% of annual Net Sales, subject to stated exclusions and cooperative-credit rules. | Not isolated | The average Advertising line was $24,629, but its exact mapping to each contractual program is not defined. |
| Technology | Required systems and programs are described across Items 6, 8, and 11; amounts can vary. | $6,085 | Recorded as a separate average overhead line in the franchised-unit Item 19 table. |
Sources: 2026 Penn Station FDD, Item 6, pp. 7–14; Item 19, p. 64. Percentages and dollar lines are not additive unless their definitions and accounting treatment are confirmed.
What makes a reasonable earnings range uncertain?
The largest uncertainty is the restaurant’s sales position within the system, followed by labor structure and financing. The mixed-population cohort medians ranged from $7,690 of EBITDA in the bottom sales quartile to $80,044 in the middle 50% and $213,306 in the top quartile. This spread is official historical evidence, but it does not assign a new buyer to a cohort.
- EBITDA: restaurant earnings before interest, income taxes, depreciation, and amortization, with General Manager costs included but owner compensation and several owner-specific or multi-unit costs excluded.
- Estimated pre-tax owner earnings: for this analysis, reported EBITDA is the nearest official proxy before personal taxes and financing principal, but owner-role mix, debt interest, capital expenditures, remodels, and owner-specific expenses still require separate treatment.
- Owner-operator benefit: residual EBITDA plus the supported value of General Manager labor actually replaced by the owner. The labor component is compensation for work performed.
- After-tax take-home pay: not estimated because entity structure, jurisdiction, deductions, distributions, and owner circumstances differ.
The full-year sample is broad, but it excludes four 2025 openings
Item 19 includes all 317 franchised restaurants open for all of 2025. Item 20 reports 321 franchised outlets at year-end, four openings, four outlets that ceased operations for other reasons, and 13 ownership transfers during 2025. New-unit ramp-up results are therefore not represented in the primary full-year earnings figures.
Source: 2026 Penn Station FDD, Item 19, pp. 62–71; Item 20, pp. 72–76.
What should a buyer verify before using these figures?
The defensible use of Item 19 is to create a location-specific operating model and test it against franchisee records. The following points address the largest unresolved variables.
- Request the written substantiation supporting the 2025 Unit Financial Data Documents and reconcile the proposed site to the in-line or freestanding format.
- Ask current franchisees for actual Net Sales, EBITDA, owner hours, General Manager compensation, rent, delivery expense, bank charges, repairs, and recent remodel spending.
- Confirm whether the Managing Owner will personally supervise the first restaurant, whether Penn Station will authorize a General Manager, and which owner payroll or benefit costs remain.
- Model debt interest and principal separately using the actual financed amount, rate, term, and payment schedule; Item 19 excludes financing costs.
- Confirm the royalty schedule, National Fund rate, local advertising obligation, technology requirements, and any abatements in the specific Franchise Agreement.
- Use Item 20 franchisee and former-franchisee contacts to investigate closures, transfers, mature-unit economics, and new-unit ramp-up outside the full-year cohort.
Where can the underlying rules and franchise offer be checked?
The principal operating evidence is the 2026 Penn Station FDD, while the public links below verify the official U.S. franchise channel and the federal disclosure framework. The franchisor’s public site does not replace the Item 19 tables or written substantiation.
What is the strongest defensible Penn Station owner-earnings range?
For a full-year U.S. Penn Station restaurant on the FDD’s reported-cost basis, the strongest central benchmark is approximately $81,000 to $102,000 of annual EBITDA, based on the official 2025 median and average for 317 franchised units. The wider official cohort evidence runs from about $8,000 median EBITDA in the bottom sales quartile to about $213,000 in the top quartile, using the mixed 318-unit cohort. The most important earnings driver is sales position; the largest unresolved uncertainty is how a specific location’s labor, occupancy, delivery, financing, capital spending, and owner role compare with the reporting population. An active owner may increase owner-operator benefit by replacing some General Manager cost, but that increment pays for full-time labor and is not passive profit. The final decision should reconcile Item 19 substantiation, the applicable Franchise Agreement, and detailed interviews with current and former franchisees.