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8-K - FORM 8-K - Bravo Brio Restaurant Group, Inc. | c12708e8vk.htm |
Exhibit 99.1
Bravo Brio Restaurant Group, Inc. Reports Financial Results for the Fourth Quarter and
Full Year 2010
Company Provides Outlook for Full Year 2011
Full Year 2010
Company Provides Outlook for Full Year 2011
Columbus, Ohio February 16, 2011 Bravo Brio Restaurant Group, Inc. (NASDAQ: BBRG), owner and
operator of the BRAVO! Cucina Italiana (BRAVO!) and BRIO Tuscan Grille (BRIO) restaurant concepts,
today reported financial results for the 13 weeks and 52 weeks ended December 26, 2010. The
Company also provided its outlook for the full year 2011.
Selected Highlights for the Fourth Quarter Compared to the Prior Year Period Include the Following:
| Revenues increased by 8.6% to $88.3 million from $81.4 million. |
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| Total comparable restaurant sales increased 2.2%. |
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| BRIO comparable restaurant sales increased 4.7% and BRAVO! comparable restaurant
sales decreased 0.3%. |
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| Restaurant-level operating profit increased 6.4% to $18.0 million from $16.9 million. |
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| GAAP net loss attributed to common shareholders was ($6.5) million, or ($0.42) per basic
and diluted share, compared to GAAP net loss attributed to common shareholders of ($3.8)
million, or ($0.52) per basic and diluted share for the prior year period. |
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| Modified pro forma net income was $5.5 million, or $0.27 per diluted share, compared to
modified pro forma net income of $4.6 million, or $0.22 per diluted share for the prior
year period. Please see the accompanying financial table for a reconciliation from GAAP
net loss to modified pro forma (non-GAAP) net income. |
Selected Highlights for the Full Year 2010 Compared to the Prior Year Period Include the Following:
| Revenues increased by 10.0% to $343.0 million from $311.7 million. |
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| Total comparable restaurant sales increased 1.6%. |
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| BRIO comparable restaurant sales increased 3.2% and BRAVO! comparable restaurant
sales decreased 0.1%. |
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| Restaurant-level operating profit increased 16.3% to $63.0 million from $54.2 million. |
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| GAAP net loss attributed to common shareholders was ($5.0) million, or ($0.54) per basic
and diluted share, compared to GAAP net loss attributed to common shareholders of ($8.2)
million, or ($1.13) per basic and diluted share for the prior year period. |
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| Modified pro forma net income was $15.5 million, or $0.75 per diluted share, compared to
modified pro forma net income of $8.1 million, or $0.39 per diluted share for fiscal 2009.
Please see the accompanying financial table for a reconciliation from GAAP net loss to
modified pro forma (non-GAAP) net income. |
We attribute our strong financial performance, both in the recent quarter as well as for the full
year, to the dedication of our team in creating highly satisfied guests and to the effective
management of costs in a challenging operational environment. As we enter 2011, we are very
excited about our opportunity for continued growth and will remain focused on the fundamentals as
well as executing across all facets of our business, said Saed Mohseni, Chief Executive Officer
and President, Bravo Brio Restaurant Group, Inc.
Fourth Quarter 2010 Financial Results
Revenues increased 8.6% to $88.3 million in the fourth quarter of 2010, from $81.4 million in the
fourth quarter of 2009. The increase in revenues was primarily due to an additional 63 operating
weeks provided by five new restaurants opened in 2010 and two new restaurants opened in the fourth
quarter of 2009. Total comparable restaurant sales increased 2.2%, which was driven by an increase
in both guest counts as well as comparable average check.
Total restaurant operating costs increased 9.2% to $70.3 million in the fourth quarter of 2010,
from $64.5 million in the prior year period. Total restaurant-level operating profit increased
6.4% to $18.0 million from $16.9 million. The Company benefitted from lower cost of sales and
labor costs, but faced higher operating and occupancy costs during the period.
GAAP net loss attributed to common shareholders in the fourth quarter of 2010 was $(6.5) million,
or $(0.42) per basic and diluted share, compared to GAAP net loss attributed to common shareholders
of $(3.8) million, or $(0.52) per basic and diluted share in the prior year period.
On a modified pro forma basis, a measure that management believes offers a more useful
year-over-year performance comparison, modified pro forma net income for the fourth quarter of 2010
was $5.5 million, or $0.27 per diluted share, compared to modified pro forma net income of $4.6
million, or $0.22 per diluted share, in the prior year period.
Please see the accompanying financial tables for a reconciliation from GAAP net loss attributed to
common shareholders to modified pro forma (non-GAAP) net income.
Fourth Quarter 2010 Brand Operating Highlights
Comparable restaurant sales at BRIO increased 4.7% in the fourth quarter of 2010 and average weekly
sales were $97,400. At BRAVO!, comparable restaurant sales decreased 0.3% and average weekly sales
were $64,300.
During the fourth quarter of 2010, the Company opened a BRIO in Delaware, its first location in the
state. As of December 26, 2010, the Company owned and operated 47 BRAVO!, 38 BRIO and one Bon Vie
restaurant across 29 states.
Outlook
The Company is providing the following outlook for the full year 2011:
| Revenues are expected in the $365 million to $370 million range. |
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| Total comparable restaurant sales are expected to increase in the 1% to 3% range. |
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| Development of six to seven new restaurants, an increase of one opening from previous
expectations. |
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| Preopening costs of approximately $4 million, which primarily reflects the increase in
openings. |
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| Modified pro forma earnings of $0.75 to $0.80 per diluted share. |
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| Capital expenditures of $22 million to $24 million. |
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| Diluted share count of approximately 20.6 million. |
Investor Conference Call and Webcast
The Company will host an investor conference call to discuss financial results for the fourth
quarter and full year 2010 today, February 16, 2011, at 5:00 PM ET. The call will be hosted by Saed
Mohseni, Chief Executive Officer, and Jim OConnor, Chief Financial Officer.
The conference call can be accessed live over the phone by dialing (888) 516-2377, or for
international callers (719) 325-2191. A replay will be available one hour after the call and can be
accessed by dialing (877) 870-5176 or (858) 384-5517 for international callers; the conference ID
is 5090606. The replay will be available until Wednesday, March 2, 2011.
The call will also be webcast live from the Companys investor relations website at
http://investors.bbrg.com.
About Bravo Brio Restaurant Group, Inc.
Bravo Brio Restaurant Group, Inc. is a leading owner and operator of two distinct Italian
restaurant brands, BRAVO! Cucina Italiana and BRIO Tuscan Grille. BBRG has positioned its brands as
multifaceted culinary destinations that deliver the ambiance, design elements and food quality
reminiscent of fine dining restaurants at a value typically offered by casual dining
establishments, a combination known as the upscale affordable dining segment. Each of BBRGs brands
provides its guests with a fine dining experience and value by serving affordable cuisine prepared
using fresh flavorful ingredients and authentic Italian cooking methods, combined with attentive
service in an attractive, lively atmosphere. BBRG strives to be the best Italian restaurant company
in America and is focused on providing its guests an excellent dining experience through
consistency of execution.
Forward-Looking Statements
Some of the statements in this release contain forward-looking statements, which involve risks and
uncertainties. These statements relate to future events or our future financial performance. We
have attempted to identify forward-looking statements by terminology including anticipates,
believes, can, continue, could, estimates, expects, intends, may, plans,
potential, predicts, should or will or the negative of these terms or other comparable
terminology. These statements are only predictions and involve known and unknown risks,
uncertainties, and other factors, including those discussed under the heading Risk Factors in our
Registration Statement on Form S-1 originally filed July 2, 2010, as amended (Registration No.
333-167951).
Although we believe that the expectations reflected in the forward-looking statements are
reasonable based on our current knowledge of our business and operations, we cannot guarantee
future results, levels of activity, performance or achievements. We assume no obligation to provide
revisions to any forward-looking statements should circumstances change.
Contacts:
Investor Relations
Don Duffy/Raphael Gross
(203) 682-8200
investors@bbrg.com
Investor Relations
Don Duffy/Raphael Gross
(203) 682-8200
investors@bbrg.com
BRAVO BRIO RESTAURANT GROUP, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS GAAP PRESENTATION WITH RECONCILIATION TO MODIFIED PRO FORMA
THIRTEEN AND FIFTY-TWO WEEKS ENDED DECEMBER 26, 2010 AND DECEMBER 27, 2009
(Dollars in thousands, except per share data)
THIRTEEN AND FIFTY-TWO WEEKS ENDED DECEMBER 26, 2010 AND DECEMBER 27, 2009
(Dollars in thousands, except per share data)
Thirteen Weeks | Thirteen Weeks | Fifty-Two Weeks | Fifty-Two Weeks | |||||||||||||||||||||||||||||
Ended | Ended | Ended | Ended | |||||||||||||||||||||||||||||
December 26, | December 27, | December 26, | December 27, | |||||||||||||||||||||||||||||
2010 | 2009 | 2010 | 2009 | |||||||||||||||||||||||||||||
Actual | Actual | Actual | Actual | |||||||||||||||||||||||||||||
Revenues |
$ | 88,325 | $ | 81,352 | $ | 343,025 | $ | 311,709 | ||||||||||||||||||||||||
Total Costs and Expenses |
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Cost of Sales |
23,332 | 26.4 | % | 21,760 | 26.7 | % | 89,456 | 26.1 | % | 82,609 | 26.5 | % | ||||||||||||||||||||
Labor |
27,964 | 31.7 | % | 26,127 | 32.1 | % | 114,468 | 33.4 | % | 106,330 | 34.1 | % | ||||||||||||||||||||
Operating |
13,306 | 15.1 | % | 11,405 | 14.0 | % | 53,331 | 15.5 | % | 48,917 | 15.7 | % | ||||||||||||||||||||
Occupancy |
5,747 | 6.5 | % | 5,159 | 6.3 | % | 22,729 | 6.6 | % | 19,636 | 6.3 | % | ||||||||||||||||||||
General and administrative expenses |
23,682 | 26.8 | % | 4,330 | 5.3 | % | 37,539 | 10.9 | % | 17,280 | 5.5 | % | ||||||||||||||||||||
Restaurant preopening costs |
483 | 0.5 | % | 915 | 1.1 | % | 2,375 | 0.7 | % | 3,758 | 1.2 | % | ||||||||||||||||||||
Asset impairment |
| 0.0 | % | 6,436 | 7.9 | % | | 0.0 | % | 6,436 | 2.1 | % | ||||||||||||||||||||
Depreciation and amortization |
4,101 | 4.6 | % | 4,211 | 5.2 | % | 16,708 | 4.9 | % | 16,088 | 5.2 | % | ||||||||||||||||||||
Total costs and expenses |
98,615 | 111.7 | % | 80,343 | 98.8 | % | 336,606 | 98.1 | % | 301,054 | 96.6 | % | ||||||||||||||||||||
(Loss) Income from Operations |
(10,290 | ) | -11.7 | % | 1,009 | 1.2 | % | 6,419 | 1.9 | % | 10,655 | 3.4 | % | |||||||||||||||||||
Loss on
Extinguishment of Debt |
1,300 | | 1,300 | | ||||||||||||||||||||||||||||
Net Interest Expense |
799 | 0.9 | % | 1,835 | 2.3 | % | 6,121 | 1.8 | % | 7,119 | 2.3 | % | ||||||||||||||||||||
(Loss) Income before Income Taxes |
(12,389 | ) | -14.0 | % | (826 | ) | -1.0 | % | (1,002 | ) | -0.3 | % | 3,536 | 1.1 | % | |||||||||||||||||
Income Tax Expense (Benefit) |
80 | 0.1 | % | (147 | ) | -0.2 | % | 228 | 0.1 | % | 135 | 0.0 | % | |||||||||||||||||||
Net (Loss) Income |
(12,469 | ) | -14.1 | % | (679 | ) | -0.8 | % | (1,230 | ) | -0.4 | % | 3,401 | 1.1 | % | |||||||||||||||||
Undeclared Preferred Dividends, net of adjustment |
5,932 | (3,089 | ) | (3,769 | ) | (11,599 | ) | |||||||||||||||||||||||||
Net Loss Attributed to
Common Shareholders |
$ | (6,537 | ) | $ | (3,768 | ) | $ | (4,999 | ) | $ | (8,198 | ) | ||||||||||||||||||||
Basic and Diluted Shares |
15,421 | 7,234 | 9,281 | 7,234 | ||||||||||||||||||||||||||||
Basic and Diluted Earnings Per Share |
$ | (0.42 | ) | $ | (0.52 | ) | $ | (0.54 | ) | $ | (1.13 | ) | ||||||||||||||||||||
ADJUSTMENTS TO RECONCILE GAAP TO MODIFIED PRO FORMA RESULTS | ||||||||||||||||||||||||||||||||
Management Fees (1) |
1,151 | 436 | 2,402 | 1,722 | ||||||||||||||||||||||||||||
Incremental Public Company Costs (2) |
(246 | ) | (306 | ) | (1,164 | ) | (1,224 | ) | ||||||||||||||||||||||||
Stock Compensation Costs (3) |
(157 | ) | (450 | ) | (1,507 | ) | (1,800 | ) | ||||||||||||||||||||||||
Interest Expense (4) |
287 | 1,279 | 4,169 | 4,453 | ||||||||||||||||||||||||||||
Income Tax Expense (5) |
(2,271 | ) | (2,125 | ) | (6,399 | ) | (3,351 | ) | ||||||||||||||||||||||||
Undeclared Preferred Dividends (6) |
(5,932 | ) | 3,089 | 3,769 | 11,599 | |||||||||||||||||||||||||||
Write-off of Loan Origination Fees (7) |
1,300 | | 1,300 | | ||||||||||||||||||||||||||||
Stock Compensation Costs (8) |
17,892 | | 17,892 | | ||||||||||||||||||||||||||||
Gain on Sale of Restaurant (9) |
| 25 | | (1,502 | ) | |||||||||||||||||||||||||||
Asset Impairment (10) |
| 6,436 | | 6,436 | ||||||||||||||||||||||||||||
Total Adjustments |
12,024 | 8,384 | 20,462 | 16,333 | ||||||||||||||||||||||||||||
Modified Proforma Net Income |
$ | 5,487 | $ | 4,616 | $ | 15,463 | $ | 8,135 | ||||||||||||||||||||||||
Basic Shares Pro Forma |
19,251 | 19,251 | 19,251 | 19,251 | ||||||||||||||||||||||||||||
Basic Earnings Per Share Pro Forma |
$ | 0.29 | $ | 0.24 | $ | 0.80 | $ | 0.42 | ||||||||||||||||||||||||
Diluted Shares Pro Forma |
20,600 | 20,600 | 20,600 | 20,600 | ||||||||||||||||||||||||||||
Diluted Earnings Per Share Pro Forma |
$ | 0.27 | $ | 0.22 | $ | 0.75 | $ | 0.39 | ||||||||||||||||||||||||
Notes to adjustments shown above: |
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1. | Represents management fees and expenses paid to our private equity sponsors which will not be incurred subsequent to our initial public offering. |
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2. | Represents an estimate of additional recurring incremental legal, accounting, insurance and other compliance costs we expect to incur as a public company. |
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3. | Represents the estimate of recurring stock compensation expense related to restricted shares issued pursuant to the Bravo Brio Restaurant Group, Inc. Stock Incentive Plan which was approved by our board of
directors and shareholders in October, 2010, offset by the actual compensation cost booked in the fourth quarter of 2010 related to outstanding restricted shares. |
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4. | Represents an adjustment to interest expense assuming the receipt of proceeds from our initial public offering and the use of such proceeds to pay down debt at the beginning of fiscal 2009. |
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5. | Currently, our net deferred tax assets are offset by a full valuation allowance. This adjustment reflects a tax rate of 30.0% which reflects our estimate of our long-term effective tax rate. |
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6. | Our Series A preferred shares plus cumulative undeclared dividends thereon were converted to common shares pursuant to the exchange agreement (executed in connection with our initial public offering). This
adjustment reflects the add-back of undeclared preferred dividends, net of gain on conversion of preferred stock. |
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7. | Reflects the write-off of the unamortized portion of our old loan origination costs related to our previous credit facility. |
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8. | Represents the one-time non-cash stock compensation charge recorded for existing options to purchase our common shares, under the 2006 Stock Option Plan, that became fully vested and exercisable upon
consummation of our initial public offering. |
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9. | Reflects an adjustment for a gain on the sale of a restaurant during the third quarter of 2009, primarily due to the recognition of deferred lease incentives. We do not expect gains of this nature in the future. |
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10. | Reflects the charges recorded in fiscal 2009 related to the impairment of three restaurants. |