10/17/2005 7:30:52 AM CINCINNATI, Oct 17, 2005 /PRNewswire-FirstCall via COMTEX/ -- Frisch's Restaurants, Inc. (FRS) reported record sales for its 16-week fiscal first quarter ended September 18, 2005. Revenues rose 2.9% to $86,532,775 from $84,062,163 for last year's first quarter. Net earnings for the quarter declined 13% to $2,522,095 compared to $2,898,671 last year. Diluted earnings per share decreased to $.49 per share, from $.56 per share last year.
Craig F. Maier, President and Chief Executive Officer, said, "Same store sales at our Big Boy Restaurants decreased 0.8% in our fiscal first quarter, the second straight quarter of modest declines. Like many other restaurant operators in the family dining segment of the foodservice industry, we have experienced softness in same store sales as our customers continue to be impacted by higher energy costs."
Maier added, "Our Golden Corral restaurants posted a same store sales decline of 11.2% during our fiscal first quarter. We have experienced same store sales declines for our Golden Corral restaurants for eight straight quarters now. We are continuing to research the various causes and will develop appropriate responses."
During the quarter, the company reopened one new Big Boy restaurant in Cincinnati. Two new Golden Corral restaurants opened during the quarter in the Pittsburgh market and an additional restaurant opened today in Findlay, Ohio. One more Golden Corral restaurant is scheduled to open in November in Morgantown, West Virginia. When that West Virginia restaurant is completed, Frisch's will have 34 Golden Corral restaurants and 89 company-owned Big Boy restaurants in operation, in addition to 28 franchised Big Boy restaurants in our territory.
Lower earnings for the quarter can be attributed to both the same store sales decline and to higher operating expenses, particularly in categories less volume-sensitive, such as utilities and store-opening expenses. Food cost as a percentage of sales was slightly lower than a year ago.
Net earnings per share were favorably impacted by credits to earnings for reductions of insurance claims reserves in both the 2006 and 2005 first quarter. For fiscal 2006, the credit amounted to $.05 per share. In last year's first quarter, the credit was $.08 per share.
Frisch's Restaurants, Inc. is a regional company that operates full service family-style restaurants under the name "Frisch's Big Boy." The Company also operates grill buffet style restaurants under the name "Golden Corral" pursuant to certain licensing agreements. All Big Boy restaurants are currently located in various regions of Ohio, Kentucky and Indiana. Golden Corral restaurants currently operate primarily in the greater metropolitan areas of Cincinnati, Dayton, Toledo and Cleveland, Ohio, Louisville, Kentucky and Pittsburgh, Pennsylvania. Plans are in place to expand the Golden Corral operation into markets in Morgantown, West Virginia, Columbus, Ohio, northern Indiana and southern Michigan.
The Company owns the trademark "Frisch's" and has exclusive, irrevocable ownership of the rights to the "Big Boy" trademark, trade name and service mark in the states of Kentucky and Indiana, and in most of Ohio and Tennessee. All of the Frisch's Big Boy restaurants also offer "drive-thru" service. The Company also licenses Big Boy restaurants to other operators, currently in certain parts of Ohio, Kentucky and Indiana.
The Company has reported a profit every year since going public in 1960, and paid cash dividends to shareholders every quarter over the same period.
Statements contained in this press release which are not historical facts are forward looking statements as that item is defined in the Private Securities Litigation Act of 1995. Such forward looking statements are subject to risks and uncertainties which could cause actual results to differ materially from estimated results. Such risks and uncertainties are detailed in the Company's filings with the Securities and Exchange Commission.
Contact: Bill Roberts, CTC (937) 434-2700 Wayne Buckhout, CTC (937) 434-2700
| Frisch's Restaurants, Inc. and Subsidiaries CONSOLIDATED STATEMENT OF EARNINGS (unaudited) (In thousands, except per share data) | ||
| Sixteen Weeks ended | Sept. 18, 2005 | Sept. 19, 2004 |
| Sales | $86,533 | $84,062 |
| Cost of sales | 30,104 | 29,414 |
| Food and paper | 28,672 | 27,993 |
| Payroll and related | 18,887 | 17,554 |
| Other operating costs | 77,663 | 74,961 |
| Gross profit | 8,870 | 9,101 |
| Administrative and advertising | 4,581 (372) | 4,325 (423) |
| Franchise fees and other revenue | 4,661 | 5,199 |
| Operating profit | 782 | 806 |
| Interest expense | 3,879 | 4,393 |
| Earnings before income tax | 1,357 | 1,494 |
| Income taxes | 2,522 | 2,899 |
| NET EARNINGS | ||
| Earnings per share (EPS) of common stock: | ||
| Basic net earnings per share | $.50 | $.58 |
| Diluted net earnings per share | $.49 | $.56 |
| Diluted average shares outstanding | 5,162 | 5,159 |
| Depreciation included above | $3,847 | $3,489 |
| Opening expense included above | $761 | $723 |
| Frisch's Restaurants, Inc. and Subsidiaries CONSOLIDATED BALANCE SHEET (In thousands of dollars) | ||
| Sept. 18, 2005 (unaudited) | May 29, 2005 | |
| Assets Current assets Cash and equivalents | $315 | $306 |
| Receivables | 1,654 | 1,390 |
| Inventories | 4,279 | 4,592 |
| Other current assets | 4,304 | 3,494 |
| 10,552 | 9,782 | |
| Property and equipment | 152,430 | 148,202 |
| Other assets Goodwill & other intangible assets | 2,177 | 2,141 |
| Property held for sale and land investments | 2,863 | 2,832 |
| Other | 2,578 | 2,642 |
| 7,618 | 7,615 | |
| $170,600 | $165,599 | |
| Liabilities and shareholders' equity Current liabilities Accounts payable | $15,434 | $12,799 |
| Accrued expenses | 8,844 | 8,764 |
| Other | 9,882 | 9,399 |
| 34,160 | 30,962 | |
| Long-term obligations Long-term debt | 29,639 | 29,570 |
| Other long-term obligations | 13,063 | 12,897 |
| 42,702 | 42,467 | |
| Shareholders' equity | 93,738 | 92,170 |
| $170,600 | $165,599 | |
SOURCE:Frisch's Restaurants, Inc. Donald H. Walker, Vice President-Finance and CFO of Frisch's Restaurants, Inc., +1-513-559-5202; or Bill Roberts or Wayne Buckhout, both of CTC, +1-937-434-2700 http://www.prnewswire.com
