CINCINNATI, Jan. 15 /PRNewswire-FirstCall/ -- Frisch's Restaurants, Inc. (AMEX:FRS) reported record sales for its 12-week fiscal second quarter ended December 11, 2007. Revenues rose 1.4% to $69,213,384 from $68,268,449 for last year's second quarter. Net earnings for the quarter decreased 22.8% to $2,168,015 compared to $2,808,026 last year. Diluted earnings per share decreased to $.41 per share, from $.54 per share last year.
For the first half of fiscal 2008, revenue also rose 1.4% to $158,739,828 from $156,516,874 for the first half of last year. Earnings decreased 9.1% to $4,618,500 from $5,080,226. Diluted earnings per share declined to $.88 from $.98 last year.
Craig F. Maier, President and Chief Executive Officer, said, "Same store sales at our Big Boy Restaurants increased a modest 0.4% in the second quarter. Higher gasoline costs and the sluggish Midwest economy continue to impact our customers." Maier added, "Our Golden Corral restaurants posted another same store sales decline of 1.8% during the second quarter. While the recent quarterly declines are less than previous years, we are still looking for the key to reverse the sales trends in Golden Corral." No new restaurants opened during the second quarter. During the first quarter, the Company opened two new Big Boy restaurants and replaced an older unit that was closed in April 2007. Also, a new Golden Corral restaurant was opened during the first quarter. Frisch's operates 35 Golden Corral restaurants and 89 company-owned Big Boy restaurants, and there are an additional 28 franchised Big Boy restaurants operated by licensees.
The lower earnings for the quarter can be attributed to the modest sales changes coupled with higher food cost in both Big Boy and Golden Corral operations.
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, Cleveland, Columbus, Dayton and Toledo, Ohio, Louisville, Kentucky and Pittsburgh, Pennsylvania. The Company has development rights to expand the Golden Corral operation into markets in 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.
Frisch's Restaurants, Inc. and Subsidiaries
CONSOLIDATED STATEMENT OF EARNINGS (unaudited)
(In thousands, except per share data) Twenty-eight weeks ended Twelve weeks ended
Dec. 11, Dec. 12, Dec. 11, Dec. 12,
2007 2006 2007 2006 Sales $158,740 $156,517 $69,213 $68,268
Cost of sales
Food and paper 55,952 54,389 24,355 23,384
Payroll and related 52,490 51,493 22,711 22,412
Other operating costs 35,559 34,759 15,198 14,726
144,001 140,641 62,264 60,522 Gross profit 14,739 15,876 6,949 7,746
Administrative and
advertising 7,830 7,689 3,483 3,426
Franchise fees and other
revenue (679) (690) (301) (295)
Gains on sale of assets (525) (250) - (250) Operating profit 8,113 9,127 3,767 4,865 Interest expense 1,320 1,430 578 611 Earnings before income tax 6,793 7,697 3,189 4,254 Income taxes 2,174 2,617 1,021 1,446 NET EARNINGS $4,619 $5,080 $2,168 $2,808 Earnings per share (EPS)
of common stock: Basic net earnings per share $.90 $1.00 $.42 $.55 Diluted net earnings per
share $.88 $.98 $.41 $.54 Diluted average shares
outstanding 5,253 5,174 5,253 5,183 Depreciation included above $7,492 $7,164 $3,264 $3,087 Opening expense included above $605 $241 $20 $111 Frisch's Restaurants, Inc. and Subsidiaries
CONSOLIDATED BALANCE SHEET
(In thousands of dollars) Dec. 11, May 29,
2007 2007
(unaudited)
Assets
Current assets
Cash and equivalents $1,354 $321
Receivables 1,434 1,406
Inventories 5,497 6,376
Other current assets 3,650 2,915
11,935 11,018
Property and equipment 158,495 159,287
Other assets
Goodwill & other intangible assets 1,922 1,957
Property held for sale and land
investments 3,006 3,721
Other 2,785 3,276
7,713 8,954 $178,143 $179,259 Liabilities and shareholders' equity
Current liabilities
Accounts payable $11,189 $12,354
Accrued expenses 8,939 9,235
Other 14,172 15,262
34,300 36,851 Long-term obligations
Long-term debt 23,953 25,009
Other long-term obligations 8,601 9,529
32,554 34,538 Shareholders' equity 111,289 107,870 $178,143 $179,259
DATASOURCE: Frisch's Restaurants, Inc.
CONTACT: Donald H. Walker, Vice President-Finance and CFO of Frisch's Restaurants, Inc., +1-513-559-5202 Web site: http://www.frischs.com/
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