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8-K - 8-K - FRISCHS RESTAURANTS INC | d8k.htm |
Exhibit 99.1
Company Contact:
Donald H. Walker
Vice President-Finance and CFO
Frischs Restaurants, Inc.
(513) 559-5202
www.frischs.com
Frischs Reports Record Sales for Fiscal 2011
FOR IMMEDIATE RELEASE
Cincinnati, OHJuly 26, 2011, Frischs Restaurants, Inc. (NYSE Amex: FRS) reported record sales of $303,540,552 for the fiscal year ended May 31, 2011, as sales rose $10,668,378, or 3.6%, from $292,872,174 last year. Net earnings for the year declined 5.3% to $9,472,589 compared to $9,998,931 last year. Diluted earnings per share decreased to $1.87 per share, from $1.93 per share last year.
For the fourth quarter of fiscal 2011, revenue climbed 1.9% to $72,472,819 from $71,118,878 in last years fourth quarter. Net earnings declined 8.7% to $2,391,114 compared to $2,618,339 in last years fourth quarter. Earnings per share declined to $.48 in the quarter compared to $.51 last year.
Craig F. Maier, President and Chief Executive Officer, said, Same store sales at our Big Boy Restaurants declined 0.4% for the year. For the fourth quarter, Big Boy same store sales rose 0.5%. The increase in total sales for the year was the result of more Big Boy restaurants in operation this year.
Maier added, Our Golden Corral restaurants posted a same store sales increase of 0.6% during the year despite declining 3.6% in the last quarter of the year.
The decline in operating earnings was largely driven by higher commodity costs that plagued the restaurant industry for the past year and a half. Another factor that hurt operating results was persistently high unemployment in the Midwest that limited the Companys customers disposable income, which in turn inhibited sales growth. The combination of high commodity costs and relatively flat same store sales resulted in a decline in operating earnings. Thanks in large part to a lower effective tax rate, net earnings did not fall as rapidly as operating earnings.
During the year, the Company opened four new Big Boy restaurants. As of May 31, 2011, Frischs operated 35 Golden Corral restaurants and 95 company-owned Big Boy restaurants, and there were an additional 25 franchised Big Boy restaurants operated by licensees. In addition, the Company currently has two more Big Boy restaurants under construction.
Frischs Restaurants, Inc. is a regional company that operates full service family-style restaurants under the name Frischs 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, Cleveland, Columbus, Dayton and Toledo, Ohio, Louisville, Kentucky and Pittsburgh, Pennsylvania.
The Company owns the trademark Frischs and has exclusive, irrevocable ownership of the rights to the Big Boy trademark, trade name and service marks in the states of Kentucky and Indiana, and in most of Ohio and Tennessee. All of the Frischs 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 Companys filings with the Securities and Exchange Commission.
Frischs Restaurants, Inc. and Subsidiaries
CONSOLIDATED STATEMENT OF EARNINGS
(In thousands, except per share data)
Year ended | (unaudited) Quarter ended |
|||||||||||||||
May 31, 2011 |
June 1, 2010 |
May 31, 2011 |
June 1, 2010 |
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Sales |
$ | 303,541 | $ | 292,872 | $ | 72,473 | $ | 71,119 | ||||||||
Cost of sales |
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Food and paper |
105,484 | 99,651 | 25,876 | 24,481 | ||||||||||||
Payroll and related |
101,067 | 97,919 | 23,843 | 23,596 | ||||||||||||
Other operating costs |
67,631 | 64,988 | 16,078 | 15,400 | ||||||||||||
274,182 | 262,558 | 65,797 | 63,477 | |||||||||||||
Gross profit |
29,359 | 30,314 | 6,676 | 7,642 | ||||||||||||
Administrative and advertising |
15,872 | 15,127 | 3,384 | 3,694 | ||||||||||||
Franchise fees and other revenue |
(1,324 | ) | (1,266 | ) | (319 | ) | (296 | ) | ||||||||
Loss on sale of assets |
40 | | 40 | | ||||||||||||
Operating profit |
14,771 | 16,453 | 3,571 | 4,244 | ||||||||||||
Interest expense |
1,582 | 1,748 | 355 | 393 | ||||||||||||
Earnings before income taxes |
13,189 | 14,705 | 3,216 | 3,851 | ||||||||||||
Income taxes |
3,716 | 4,706 | 825 | 1,233 | ||||||||||||
NET EARNINGS |
$ | 9,473 | $ | 9,999 | $ | 2,391 | $ | 2,618 | ||||||||
Earnings per share (EPS) of common stock: |
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Basic net earnings per share |
$ | 1.88 | $ | 1.96 | $ | .48 | $ | .51 | ||||||||
Diluted net earnings per share |
$ | 1.87 | $ | 1.93 | $ | .48 | $ | .51 | ||||||||
Diluted average shares outstanding |
5,068 | 5,192 | 4,979 | 5,163 | ||||||||||||
Depreciation included above |
$ | 15,563 | $ | 14,085 | $ | 3,638 | $ | 3,373 | ||||||||
Opening expense included above |
$ | 1,073 | $ | 768 | $ | 91 | $ | 349 | ||||||||
Frischs Restaurants, Inc. and Subsidiaries
CONSOLIDATED BALANCE SHEET
(In thousands of dollars)
May 31, 2011 |
June 1, 2010 |
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Assets |
||||||||
Current assets |
||||||||
Cash and equivalents |
$ | 2,449 | $ | 647 | ||||
Receivables |
1,997 | 1,534 | ||||||
Inventories |
5,717 | 5,959 | ||||||
Other current assets |
4,697 | 2,249 | ||||||
14,860 | 10,389 | |||||||
Property and equipment |
172,922 | 168,699 | ||||||
Other assets |
||||||||
Goodwill & other intangible assets |
1,237 | 1,459 | ||||||
Property held for sale and land investments |
3,845 | 3,682 | ||||||
Deferred income taxes and other |
2,410 | 5,024 | ||||||
7,492 | 10,165 | |||||||
$ | 195,274 | $ | 189,253 | |||||
Liabilities and shareholders equity |
||||||||
Current liabilities |
||||||||
Accounts payable |
$ | 10,216 | $ | 10,558 | ||||
Accrued expenses |
10,083 | 9,641 | ||||||
Other |
8,801 | 8,851 | ||||||
29,100 | 29,050 | |||||||
Long-term obligations |
||||||||
Long-term debt |
22,573 | 23,286 | ||||||
Other long-term obligations |
18,073 | 16,823 | ||||||
40,646 | 40,109 | |||||||
Shareholders equity |
125,528 | 120,094 | ||||||
$ | 195,274 | $ | 189,253 | |||||