Applebee's International Reports 33 Percent Increase in Fourth Quarter Earnings Per Share of 52 Cents; EPS Increases 20 Percent in 1999.Business Editors OVERLAND PARK Overland Park, city (1990 pop. 111,790), Johnson co., NE Kans., a residential suburb of Kansas City; inc. 1960. There is printing and publishing, and the manufacture of apparel, aircraft parts, cement, prepared foods, salt, chemicals, marine accessories, and signs. , Kan Kan, river, China: see Gan. .--(BUSINESS WIRE)--Feb. 9, 2000 Fourth Quarter Comparable Sales Increase 7.2 Percent for Company Restaurants; System-Wide Up 5.8 Percent Applebee's Applebee’s International, Inc. (NASDAQ: APPB) is a United States company which develops, franchises, and operates the Applebee's Neighborhood Grill and Bar restaurant chain. As of Feb. International, Inc. (Nasdaq:APPB APPB Array Processor with Pipelined Bus APPB Application Builder ) today reported net earnings of $14.1 million, or 52 cents per share Cents per share The amount of a mutual fund's dividend or capital gains distributions that a shareholder will receive for each share owned. on both a basic and diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. basis, for the fourth quarter ended December December: see month. 26, 1999 (excluding a $2.7 million or 10 cent per share gain on the disposition Act of disposing; transferring to the care or possession of another. The parting with, alienation of, or giving up of property. The final settlement of a matter and, with reference to decisions announced by a court, a judge's ruling is commonly referred to as disposition, regardless of of restaurants). This represents an increase in earnings per share of 33 percent as compared with 39 cents per share on both a basic and diluted basis for the fourth quarter of 1998. Including the gain on disposition of restaurants, net earnings were $16.8 million, or 62 cents per share on both a basic and diluted basis, for the fourth quarter of 1999. For the fiscal year ended December 26, 1999, net earnings were a record $57.2 million, or $2.01 and $2.00 per share on a basic and diluted basis, respectively (excluding a $3.0 million or 11 cent per share net loss on the disposition of restaurants). This represents a 20 percent increase in both basic and diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of , as compared to fiscal year 1998 earnings of $1.67 per share (before an extraordinary loss of 2 cents per share) on both a basic and diluted basis. Including the net loss on disposition of restaurants, net earnings were $54.2 million, or $1.91 and $1.89 per share on a basic and diluted basis, respectively, for fiscal year 1999. Comparable sales for company restaurants increased 7.2 percent for the fourth quarter. System-wide comparable sales increased 5.8 percent for the fourth quarter, while comparable sales for franchise restaurants increased 5.4 percent. For the full year, comparable sales for company restaurants increased 4.4 percent. System-wide comparable sales increased 3.2 percent for the year, while comparable sales for franchise restaurants increased 2.9 percent. (In calculating comparable restaurant sales, restaurants open for at least 18 months are compared from period to period.) Commenting on the quarter, Lloyd L. Hill, chief executive officer, said, &uot;Applebee's position as the world's largest casual dining concept continues to expand as we ended 1999 with $2.35 billion in system-wide sales and a dominant market share in the bar and grill Grill may refer to: In food:
Hill added, &uot;We have made significant advances during 1999 in all key areas of our business. EPS (Encapsulated PostScript) A PostScript file format used to transfer a graphic image between applications and platforms. EPS files contain PostScript code as well as an optional preview image in TIFF, WMF, PICT or EPSI, the latter being an ASCII-only format. growth and return on stockholders' equity Stockholders' Equity The portion of the balance sheet that includes capital received from investors in exchange for stock (paid-in capital), donated capital, and retained earnings. This is equal to total assets minus liabilities, preferred stock and intangible assets. were both exceptional. EPS increased 20 percent - exceeding our strategic target of at least 15 percent annual growth - and return on equity reached 20 percent for the year - well ahead of our target of reaching this level by 2001. With great sales and profit momentum, we expect EPS to again increase at least 15 percent in fiscal year 2000, and look forward to another record year for Applebee's International.&uot; Other highlights for the fourth quarter and fiscal year ended December 26, 1999 included: -- System-wide sales for the Applebee's concept were a record $2.35 billion for the fiscal year ended December 26, 1999, increasing 14 percent over 1998 system sales System sales is a business term used in the franchising industry. Franchisors provide supplies, marketing and administration services to franchisees in return for a part of the franchisees' revenues. Some franchisors also operate some outlets directly. of $2.07 billion. Fourth quarter 1999 system sales for the Applebee's concept increased 15 percent over last year, reaching $592.8 million. (System-wide sales include franchisee sales as reported to Applebee's International, as well as sales from company restaurants.) -- Applebee's ended the year with 1,168 restaurants system-wide (262 company and 906 franchise restaurants). During the fourth quarter of 1999, there were 36 new Applebee's restaurants opened system-wide, including 5 company and 31 franchised restaurants. There were 107 new Applebee's restaurants opened system-wide during fiscal year 1999, including 27 company and 80 franchised restaurants. 1999 was the seventh consecutive year of over 100 new restaurant openings for the Applebee's system. New openings in 2000 are expected to be at least 115 restaurants, including 25 to 27 company restaurants and 90 to 100 franchise restaurants. -- As previously announced, in December 1999 the company completed the sale of the 12 company-owned Applebee's restaurants in the Philadelphia Philadelphia, ancient cities Philadelphia, name of several ancient cities. One was in Lydia, W Asia Minor (now W Turkey). At the foot of Mt. Tmolus and near the location of modern Alaşehir, it was founded in the 2d cent. B.C. , Pa. market area to an existing Applebee's franchisee. The sale price, as adjusted, for the transaction was $23.5 million, resulting in a gain on the disposition of $4.2 million ($2.7 million net of income taxes), or 10 cents per share, that was recognized in the fourth quarter of 1999. -- During the fourth quarter, 670,000 shares of the company's common stock were purchased in open market transactions at an aggregate cost of $21.1 million. During fiscal year 1999, the company purchased 3,332,000 shares at an aggregate cost of $103.0 million, bringing the total purchases over the last two years to 5,763,000 shares at an aggregate cost of $152.3 million. As previously announced, in December 1999 the company's board of directors authorized au·thor·ize tr.v. au·thor·ized, au·thor·iz·ing, au·thor·iz·es 1. To grant authority or power to. 2. To give permission for; sanction: an additional program to repurchase re·pur·chase tr.v. re·pur·chased, re·pur·chas·ing, re·pur·chas·es To buy (something) again. n. The act of buying something that one previously sold or owned. Noun 1. up to $32.5 million of the company's common stock through the year 2000, subject to market conditions and pursuant to applicable restrictions under the company's debt agreements. -- Long-term debt Long-Term Debt Loans and financial obligations lasting over one year. Notes: For example debts obligations such as bonds and notes which have maturities greater than one year would be considered long-term debt. was reduced by $25 million during the quarter, resulting primarily from payments made in connection with the sale of the Philadelphia market. Total debt to capitalization capitalization n. 1) the act of counting anticipated earnings and expenses as capital assets (property, equipment, fixtures) for accounting purposes. 2) the amount of anticipated net earnings which hypothetically can be used for conversion into capital assets. was 30 percent at the end of 1999. Applebee's International, Inc., headquartered in Overland Park, Kan., currently develops, franchises and operates restaurants under the Applebee's Neighborhood Grill and Bar brand, the largest casual dining concept in the world. There are currently 1,177 Applebee's restaurants operating system-wide in 49 states and eight international countries. Additional information on Applebee's International can be found at the company's website (www.applebees.com). The statements contained in this release regarding earnings per share growth and new restaurant development in 2000 are forward looking and based on current expectations. There are several risks and uncertainties that could cause actual results to differ materially from those described. For a discussion of the principal factors that could cause actual results to be materially different, the reader is referred to the company's current report on Form 8-K Form 8-K The form required by the SEC when a publicly held company incurs any event that might affect its financial situation or the share value of its stock. Form 8-K See 8-K. filed with the Securities and Exchange Commission on February February: see month. 9, 2000. The company does not intend to update these forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. .
APPLEBEE'S INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
(Unaudited)
(in thousands, except per share amounts)
13 Weeks Ended 52 Weeks Ended
----------------- ------------------
Dec. 26, Dec. 27, Dec. 26, Dec. 27,
1999 1998 1999 1998
---- ---- ---- ----
Revenues:
Company restaurant sales.... $143,728 $149,605 $596,754 $580,840
Franchise income............ 18,880 16,295 72,830 66,722
-------- -------- -------- --------
Total operating revenues... 162,608 165,900 669,584 647,562
-------- -------- -------- --------
Cost of Company restaurant
sales:
Food and beverage........... 39,691 41,455 163,865 159,420
Labor....................... 45,226 48,057 188,538 185,260
Direct and occupancy........ 34,307 37,982 145,747 146,693
Pre-opening expense......... 319 1,173 1,582 3,093
-------- -------- -------- --------
Total cost of Company
restaurant sales.......... 119,543 128,667 499,732 494,466
-------- -------- -------- --------
General and
administrative expenses..... 17,153 14,628 63,338 58,044
Amortization of
intangible assets........... 1,456 1,571 5,997 5,538
(Gain)/loss on disposition
of restaurants
and equipment............... (4,109) 94 5,607 952
-------- -------- -------- --------
Operating earnings........... 28,565 20,940 94,910 88,562
-------- -------- -------- --------
Other income (expense):
Investment income........... 292 268 1,195 1,131
Interest expense............ (2,793) (3,020) (10,814) (9,922)
Other income................ 270 228 444 638
-------- -------- -------- --------
Total other expense........ (2,231) (2,524) (9,175) (8,153)
-------- -------- -------- --------
Earnings before
income taxes and
extraordinary item.......... 26,334 18,416 85,735 80,409
Income taxes................. 9,559 6,691 31,537 29,753
-------- -------- -------- --------
Earnings before
extraordinary item.......... 16,775 11,725 54,198 50,656
Extraordinary loss from
early extinguishment
of debt, net of income taxes -- -- -- (641)
-------- -------- -------- --------
Net earnings................. $16,775 $11,725 $54,198 $50,015
======== ======== ======== ========
Basic earnings per common share:
Basic earnings before
extraordinary item......... $ 0.62 $ 0.39 $ 1.91 $ 1.67
Extraordinary item.......... -- -- -- (0.02)
-------- -------- -------- --------
Basic net earnings
per common share............ $ 0.62 $ 0.39 $ 1.91 $ 1.65
======== ======== ======== ========
Diluted earnings per
common share:
Diluted earnings before
extraordinary item......... $ 0.62 $ 0.39 $ 1.89 $ 1.67
Extraordinary item.......... -- -- -- (0.02)
-------- -------- -------- --------
Diluted net earnings
per common share............ $ 0.62 $ 0.39 $ 1.89 $ 1.65
======== ======== ======== ========
Basic weighted average
shares outstanding.......... 26,919 29,911 28,403 30,272
Diluted weighted average
shares outstanding.......... 27,233 29,976 28,601 30,385
The following table sets forth, for the periods indicated, information
derived from the Company's consolidated statements of earnings
expressed as a percentage of total operating revenues, except where
otherwise noted. Percentages may not add due to rounding.
13 Weeks Ended 52 Weeks Ended
----------------- ------------------
Dec. 26, Dec. 27, Dec. 26, Dec. 27,
1999 1998 1999 1998
---- ---- ---- ----
Revenues:
Company restaurant sales.... 88.4% 90.2% 89.1% 89.7%
Franchise income............ 11.6 9.8 10.9 10.3
-------- -------- -------- --------
Total operating revenues... 100.0% 100.0% 100.0% 100.0%
======== ======== ======== ========
Cost of sales (as a
percentage of Company
restaurant sales):
Food and beverage........... 27.6% 27.7% 27.5% 27.4%
Labor....................... 31.5 32.1 31.6 31.9
Direct and occupancy........ 23.9 25.4 24.4 25.3
Pre-opening expense......... 0.2 0.8 0.3 0.5
-------- -------- -------- --------
Total cost of sales........ 83.2% 86.0% 83.7% 85.1%
======== ======== ======== ========
General and
administrative expenses..... 10.5% 8.8% 9.5% 9.0%
Amortization of
intangible assets........... 0.9 0.9 0.9 0.9
(Gain)/loss on disposition
of restaurants
and equipment............... (2.5) 0.1 0.8 0.1
-------- -------- -------- --------
Operating earnings........... 17.6 12.6 14.2 13.7
-------- -------- -------- --------
Other income (expense):
Investment income........... 0.2 0.2 0.2 0.2
Interest expense............ (1.7) (1.8) (1.6) (1.5)
Other income................ 0.2 0.1 0.1 0.1
-------- -------- -------- --------
Total other expense........ (1.4) (1.5) (1.4) (1.3)
-------- -------- -------- --------
Earnings before income taxes
and extraordinary item...... 16.2 11.1 12.8 12.4
Income taxes................. 5.9 4.0 4.7 4.6
-------- -------- -------- --------
Earnings before
extraordinary item.......... 10.3 7.1 8.1 7.8
Extraordinary loss from
early extinguishment of
debt, net of income taxes... -- -- -- (0.1)
-------- -------- -------- --------
Net earnings................. 10.3% 7.1% 8.1% 7.7%
======== ======== ======== ========
Fiscal year 1999 financial statements have not yet been filed with the
Securities and Exchange Commission.
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