BBQZ Barbeques Galore Limited ADS (MM)

Barbeques Galore Limited (NASDAQ:BBQZ) today announced that the Federal Court of Australia approved the holding of special shareholder and option holder meetings to ratify Ironbridge Capital's proposed acquisition of all outstanding shares and options in the company in a cash transaction valued at approximately US$45 million. The company also announced that early next week it will commence mailing proxy materials relating to the special meetings, scheduled to be held on October 14, 2005, at the company's corporate headquarters in Sydney, Australia. The transaction is expected to be completed by November 1, 2005, subject to approval by shareholders and option holders, regulatory approvals and the fulfillment of certain financial and other conditions. Barbeques Galore today also reported financial results for its second fiscal quarter ended July 31, 2005. Questions or requests for free copies of the proxy materials relating to the proposed transaction may be directed to the Information Agent, PondelWilkinson Inc., at 1880 Century Park East, Suite 700, Los Angeles, California 90067, or by telephone to 866-279-8084 or 310-279-5980, by fax to 310-279-5988 or by email to investor@pondel.com. Barbeques Galore is the leading chain of specialty retail stores devoted to sales of barbecues, backyard accents, fireside products and related accessories. The company now owns and operates 68 stores in the U.S. and 44 stores in Australia. In addition, it has six franchised stores in the U.S. and 48 licensed stores in Australia. Through its U.S. e-commerce Web site, www.bbqgalore.com, the company sells an extensive line of barbecue and fireside products and related accessories. BARBEQUES GALORE AND CERTAIN OF ITS DIRECTORS AND OFFICERS MAY BE DEEMED TO BE PARTICIPANTS IN THE SOLICITATION OF PROXIES FOR THE SPECIAL MEETINGS OF SHAREHOLDERS AND OPTION HOLDERS RELATING TO THE PROPOSED TRANSACTION. BARBEQUES GALORE HAS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION AND IS COMMENCING MAILING TO ITS SHAREHOLDERS AND OPTION HOLDERS A DEFINITIVE PROXY STATEMENT FOR THE SPECIAL MEETINGS. THE DEFINITIVE PROXY STATEMENT CONTAINS IMPORTANT INFORMATION REGARDING THE PARTICIPANTS IN THE SOLICITATION AND OTHER IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION. SHAREHOLDERS AND OPTION HOLDERS OF BARBEQUES GALORE ARE ADVISED TO READ THE COMPANY'S PROXY STATEMENT FOR THE SPECIAL MEETINGS BECAUSE IT CONTAINS IMPORTANT INFORMATION. This press release contains forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include, but are not limited to statements regarding the proposed merger and the anticipated completion date. Forward looking statements are based on management's current expectations and beliefs, and are subject to risks and uncertainties. Accordingly, actual results may differ materially from the forward-looking statements contained herein. Risks that relate to these forward looking statements include the risk that the transaction will not receive the required shareholder, option holder and government approvals and the risk that the transaction will otherwise not be completed. Further detailed information about risk factors that may impact the company's business is set forth in the company's periodic filings with the U.S. Securities and Exchange Commission. Barbeques Galore expressly disclaims any obligation to update or alter its forward-looking statements, whether as a result of new information, future events or otherwise. -0- *T BARBEQUES GALORE LIMITED AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) In US$ thousands, except share and per share data Second Quarter Six Months Ended Ended July 31, July 31, --------------- ----------------- 2005 2004 2005 2004 ------- ------- -------- -------- Net Sales Australia 18,040 17,218 37,016 35,564 U.S. 43,363 40,205 70,930 65,637 ------- ------- -------- -------- Total net sales 61,403 57,423 107,946 101,201 ------- ------- -------- -------- Cost of goods sold, warehouse, distribution & occupancy costs 43,108 39,296 77,575 70,333 ------- ------- -------- -------- Gross profit 18,295 18,127 30,371 30,868 ------- ------- -------- -------- Selling, general & administration expenses 19,034 16,806 34,997 31,169 Store pre opening costs 126 71 206 145 Relocation and closure (gains) costs 0 (58) 0 (133) ------- ------- -------- -------- Operating income (loss) (865) 1,308 (4,832) (313) ------- ------- -------- -------- Interest expense 345 369 590 717 ------- ------- -------- -------- Income before tax (1,210) 939 (5,422) (1,030) ------- ------- -------- -------- Income tax expense (benefit) (389) 336 (1,878) (395) ------- ------- -------- -------- Net income (loss) (821) 603 (3,544) (635) ======= ======= ======== ======== Basic earnings per share (0.19) 0.15 (0.86) (0.15) ======= ======= ======== ======== Diluted earnings per share (0.19) 0.14 (0.81) (0.15) ======= ======= ======== ======== Weighted average shares outstanding 4,245 4,144 4,144 4,131 ======= ======= ======== ======== 4,245 4,399 4,399 4,339 ======= ======= ======== ======== US$/A$ conversion rate 0.7619 0.7055 0.7055 0.7269 BARBEQUES GALORE LIMITED AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) In Australian$ thousands, except share and per share data Second Quarter Six Months Ended Ended July 31, July 31, --------------- ----------------- 2005 2004 2005 2004 ------- ------- -------- -------- Net Sales Australia 23,678 24,405 48,012 48,637 U.S. 56,914 56,988 92,265 90,579 ------- ------- -------- -------- Total net sales 80,592 81,393 140,277 139,216 ------- ------- -------- -------- Cost of goods sold, warehouse, distribution & occupancy costs 56,580 55,700 100,780 96,695 ------- ------- -------- -------- Gross profit 24,012 25,693 39,497 42,521 ------- ------- -------- -------- Selling, general & administration expenses 24,982 23,822 45,453 42,793 Store pre opening costs 166 100 269 198 Relocation and closure (gains) costs 0 (82) 0 (181) ------- ------- -------- -------- Operating income (loss) (1,136) 1,853 (6,225) (289) ------- ------- -------- -------- Interest expense 453 523 767 982 ------- ------- -------- -------- Income before tax (1,589) 1,330 (6,992) (1,271) ------- ------- -------- -------- Income tax expense (benefit) (510) 476 (2,419) (490) ------- ------- -------- -------- Net income (loss) (1,079) 854 (4,573) (781) ======= ======= ======== ======== Basic earnings per share (0.25) 0.21 (1.10) (0.19) ======= ======= ======== ======== Diluted earnings per share (0.25) 0.19 (1.04) (0.18) ======= ======= ======== ======== Weighted average shares outstanding 4,245 4,144 4,144 4,131 ======= ======= ======== ======== 4,245 4,399 4,399 4,339 ======= ======= ======== ======== BARBEQUES GALORE LIMITED AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS In US$ thousands July 31, Jan. 31, 2005 2005 Assets Current assets: Cash and cash equivalents $ 1,332 $ 848 Accounts receivable, net 5,901 5,937 Other receivables 1,047 4,684 Inventories 46,759 45,226 Deferred income taxes 5,073 2,381 Prepaid expenses and other current assets 1,565 1,451 ------- ------- Total current assets 61,677 60,527 Non-current assets: Property, plant and equipment, net 17,878 16,554 Goodwill, net 1,085 1,079 Deferred income taxes 2,647 2,709 Other non-current assets 645 654 ------- ------- Total assets $83,932 $81,523 ======= ======= Liabilities and shareholders' equity Current liabilities: Accounts payable and accrued liabilities $25,464 $22,787 Payables to related parties 4 3 Short-term bank borrowings 19,120 15,648 Current portion of obligations under capital leases 754 978 Income taxes payable 239 2 ------- ------- Total current liabilities 45,581 39,418 Non-current liabilities: Obligations under capital leases, excluding current portion 2,012 1,807 Other long-term liabilities 2,887 2,889 ------- ------- Total liabilities $50,480 $44,114 ------- ------- Shareholders' equity: Ordinary shares, no par value; authorized 27,437,853 shares; 4,670,291 issued shares; 4,245,291 outstanding shares 31,650 32,267 Accumulated other comprehensive income (3,630) (3,937) Retained earnings 7,100 10,780 ------- ------- 35,120 39,110 Less: Treasury Stock at cost - 425,000 ordinary shares (1,668) (1,701) ------- ------- Total shareholders' equity 33,452 37,409 ------- ------- Total liabilities and shareholders' equity $83,932 $81,523 ======= ======= Exchange rate used 0.7595 0.7744 BARBEQUES GALORE LIMITED AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS In Australian$ thousands July 31, Jan. 31, 2005 2005 Assets Cash and cash equivalents $ 1,754 $ 1,095 Accounts receivable, net 7,769 7,666 Other receivables 1,378 6,049 Inventories 61,566 58,401 Deferred income taxes 6,679 3,075 Prepaid expenses and other current assets 2,062 1,874 -------- -------- Total current assets 81,208 78,160 Property, plant and equipment, net 23,539 21,376 Goodwill, net 1,428 1,393 Deferred income taxes 3,485 3,498 Other non-current assets 850 845 -------- -------- Total assets $110,510 $105,272 ======== ======== Accounts payable and accrued liabilities $ 33,529 $ 29,425 Payables to related parties 5 4 Short-term bank borrowings 25,174 20,206 Current portion of obligations under capital leases 993 1,263 Income taxes payable 315 3 -------- -------- Total current liabilities 60,016 50,901 Obligations under capital leases, excluding current portion 2,649 2,333 Other long-term liabilities 3,801 3,730 -------- -------- Total liabilities $ 66,466 $ 56,964 -------- -------- Ordinary shares, no par value; authorized 27,437,853 shares; 4,670,291 issued shares; 4,245,291 outstanding shares 41,672 41,667 Accumulated other comprehensive income (4,780) (5,084) Retained earnings 9,348 13,921 -------- -------- 46,240 50,504 Less: Treasury Stock at cost - 425,000 ordinary shares (2,196) (2,196) -------- -------- Total shareholders' equity 44,044 48,308 -------- -------- Total liabilities and shareholders' equity $110,510 $105,272 ======== ======== *T