BUCA, Inc. Announces Third Quarter 2005 Results; Comparable Restaurant Sales Increase 3.2%.MINNEAPOLIS Minneapolis (mĭn'ēăp`əlĭs), city (1990 pop. 368,383), seat of Hennepin co., E Minn., at the head of navigation on the Mississippi River, at St. Anthony Falls; inc. 1856. -- BUCA BUCA Blue Cross, United, Cigna, Aetna (Healthcare providers) BUCA Constructionman Apprentice, Builder Striker (Naval Rating) , Inc. (Nasdaq:BUCA) announced today results for its third quarter of fiscal 2005 (ended September September: see month. 25, 2005). Total restaurant sales were $63.7 million in the third quarter of fiscal 2005, a 4.6% increase over the same period in the prior year. The company reported a net loss of $20.8 million or ($1.03) per share compared with a net loss of $14.5 million or ($0.72) per share in the third quarter of fiscal 2004. Buca di Beppo Buca di Beppo is an American restaurant chain specializing in immigrant Southern Italian food. The name roughly translates as "Joe's Basement" (Beppo is slang for Joe in Southern Italy and Buca means basement (literally it means "hole") in Italian). restaurant sales increased 4.4% in fiscal third quarter 2005, while Vinny Vin´ny a. 1. Vinnewed. T's of Boston Boston, town, England Boston, town (1991 pop. 26,495), E central England, on the Witham River. Boston's fame as a port dates from the 13th cent., when it was a Hanseatic port trading wool and wine. Having recovered from a decline in the 18th and 19th cent. restaurant sales rose 5.5% in the period. For the Buca di Beppo restaurants this increase was primarily due to an approximate 1% price increase and the opening of one new restaurant both in the first quarter of fiscal 2005 and 2.5% increase in guest count during the third quarter of fiscal 2005. The opening of one new Vinny T's of Boston restaurant at the end of fiscal 2004 and a 3.1% increase in guest count during the third quarter of fiscal 2005 were the primarily drivers of the sales increase in the period. Comparable restaurant sales increased 3.2% system-wide during the third quarter of fiscal 2005 with Buca di Beppo restaurants recording a 3.5% comparable increase, and Vinny T's of Boston a 0.8% increase. Increased popularity of Buca ToGo Togo, officially Togolese Republic, republic (2005 est. pop. 5,682,000), 21,622 sq mi (56,000 sq km), W Africa. It borders on the Gulf of Guinea in the south, on Ghana in the west, on Burkina Faso in the north, and on Benin in the east. and Buca Small contributed to this performance. Total restaurant costs in third quarter of fiscal 2005 were $62.8 million, up 5.2% from the third quarter of fiscal 2004, and equaled 98.7% of restaurant sale, compared to 98.2% in the same period in the prior year. Direct and occupancy Gaining or having physical possession of real property subject to, or in the absence of, legal right or title. In a fire insurance policy, for example, the term occupancy expenses in the third quarter of fiscal 2005 were $20.9 million, or 32.8% as a percentage of sales, compared to $19.5 million, or 32.0% of sales in third quarter of fiscal 2004. The increase was primarily due to increased insurance, utility and equipment maintenance expenses. General and administrative costs administrative costs, n.pl the overhead expenses incurred in the operation of a dental benefits program, excluding costs of dental services provided. in the third quarter of fiscal 2005 increased in absolute terms (Alg.) such as are known, or which do not contain the unknown quantity. See also: Absolute to $6.7 million, or 10.6% of sales, from $4.4 million, or 7.3% of sales, in the same period of fiscal 2004. During the third quarter of 2005 the company incurred approximately $2.1 million in legal, consulting, insurance and other fees primarily related to events surrounding sur·round tr.v. sur·round·ed, sur·round·ing, sur·rounds 1. To extend on all sides of simultaneously; encircle. 2. To enclose or confine on all sides so as to bar escape or outside communication. n. the company's previously announced investigations. The company recorded an impairment Impairment 1. A reduction in a company's stated capital. 2. The total capital that is less than the par value of the company's capital stock. Notes: 1. This is usually reduced because of poorly estimated losses or gains. 2. charge of $13.3 million in the third quarter of fiscal 2005. Approximately $10.4 million of this charge reflected the loss on the impairment of long-lived long-lived adj. 1. Having a long life: a long-lived aunt. 2. Lasting a long time; persistent: a long-lived rumor. 3. assets related to nine open restaurants in various markets. The remaining $2.9 million reflected a loss on the sale of some of the properties sold in the company's September 9, 2005 sale and leaseback sale and leaseback The sale of a fixed asset that is then leased by the former owner from the new owner. A sale and leaseback permits a firm to withdraw its equity in an asset without giving up use of the asset. Also called leaseback. transaction whereby the net proceeds Net Proceeds The amount received after all costs are deducted from the sale of a piece of property or security. Notes: In the case of an investor selling a security, net proceeds represent the proceeds from the sale minus any trading costs (i.e. commissions). were less than the book value of the assets. Commented Wallace Wal·lace , Alfred Russel 1823-1913. British naturalist who developed a concept of evolution that paralleled the work of Charles Darwin. B. Doolin Doolin (Irish: Dúlainn, meaning Black church) is a coastal village in County Clare, Ireland, on the Atlantic coast. It borders the spa town of Lisdoonvarna. , the company's Chairman, President and Chief Executive Officer, "The third quarter represents an important milestone in our multi-year turnaround Turnaround A situation where a company that has had poor performance for an extended period of time experiences a positive reversal. Notes: A speculator may profit from a turnaround if he or she accurately anticipates the improvement of a poorly performing company. for BUCA, Inc. We are encouraged by our comparable restaurant sales and comparable guest counts, both of which increased for the fourth consecutive quarter and are ahead of the casual dining industry average as measured by Knapp-Track. Strategically, we closed three underperforming Buca di Beppo restaurants in single-store markets where we did not expect to expand in the future and we are exploring strategic alternatives for Vinny T's of Boston, so we can focus on being a company with one great brand. Additionally, we completed a sale-leaseback sale-lease·back n. See leaseback. transaction to reduce our outstanding debt and recorded impairments on nine of our restaurants. We are reorganizing our field operations to address these changes. The third quarter represents our lowest sales quarter of the year and we saw cost pressure, which we continue to address. However, we are staffed and focused in this fourth quarter, traditionally our highest sales quarter. Buca To Go sales have increased with the addition of curbside curb·side n. 1. The side of a pavement or street that is bordered by a curb. 2. A sidewalk. adj. Located, operating, or occurring at or along the sidewalk or curb: delivery at most units. Additionally, we are excited about the positive response we have received to our recent menu changes -- one of the largest menu roll-outs in BUCA's history. We will continue to look for ways to broaden the appeal of our fresh Italian food and build on the success we have had to date, but we believe the foundation has been laid to return the company to profitability." Nine Month 2005 Results For the first three quarters of fiscal 2005, revenue advanced 7.4% to $203.3 million from $189.2 million in the same period in prior year. The net loss for the first three quarters was ($25.3) million, or ($1.25) per share, versus $19.5 million, or ($1.00) per share, through the third quarter of fiscal 2004. Through the first three quarters of fiscal 2005 comparable restaurant sales increased 4.6% system-wide with Buca di Beppo comparable sales up 5.3% and Vinny T's of Boston down 0.4%. Through the period, total restaurant costs were $192.7 million, a 6.3% increase over the prior year, equaling 94.8% of restaurant sales, down from 95.7% of sales in the same period of fiscal 2004. Direct and occupancy costs Occupancy costs are the whole life costs of buildings and their associated land from occupancy until disposal. These costs may be incurred on a regular or irregular basis. Occupancy costs are those costs related to occupying a space including; rent, real estate taxes, personal for the period increased by approximately $3.5 million, or 6.1%, to $61.5 million equaling 30.3% of restaurant sales, down from 30.6% of sales in the same period of fiscal 2004. This decline as a percentage of sales was due primarily to the higher level of sales in 2005. General and administrative expenses of $18.9 million in the first three quarters of fiscal 2005 include approximately $5 million of legal, consulting and other expenses primarily related to events surrounding the company's previously announced investigations. The company recorded an impairment charge of $13.7 million in the first three quarters of fiscal 2005 largely related to the aforementioned a·fore·men·tioned adj. Mentioned previously. n. The one or ones mentioned previously. aforementioned Adjective mentioned before Adj. 1. impairment charges recorded in third quarter of fiscal 2005. Conference Call BUCA, Inc. will host a conference call Wednesday Wednesday: see week. , November November: see month. 9, 2005 at 5:00 p.m. Eastern Time (4:00 p.m. Central Time) to discuss these results. Hosting the call will be Wallace Doolin, Chairman, Chief Executive Officer and President, and Kaye Kaye , Danny 1913-1987. American entertainer known for his comedic roles in such motion pictures as Wonder Man (1944) and The Secret Life of Walter Mitty (1946). O'Leary O'Leary is a common Irish name, an anglicized version of the original spelling 'O Laoghaire' or 'O Laoire.' The first records of the name are from Tara where High-King Laoghaire became the first Christian king of Ireland in 432 AD. , Chief Financial Officer. The call will be webcast live from the Company's website at www.bucainc.com with the webcast link available under the investor relations Investor relations The process by which the corporation communicates with its investors. section. The webcast will also be available at http://viavid.net/dce.aspx?sid=00002A27. If you are unable to join the call, a replay will be available beginning at 8:00 p.m. Eastern Time and can be accessed by dialing 1-888-203-1112 1-719-457-0820 (international) passcode 6807546. About the Company: BUCA, Inc. owns and operates 104 highly acclaimed ac·claim v. ac·claimed, ac·claim·ing, ac·claims v.tr. 1. To praise enthusiastically and often publicly; applaud. See Synonyms at praise. 2. Southern Italian restaurants under the names Buca di Beppo and Vinny T's of Boston in 28 states and the District of Columbia District of Columbia, federal district (2000 pop. 572,059, a 5.7% decrease in population since the 1990 census), 69 sq mi (179 sq km), on the east bank of the Potomac River, coextensive with the city of Washington, D.C. (the capital of the United States). .
BUCA, Inc. and Subsidiaries
Condensed Consolidated Statements of Operations
(in thousands, except share and per share data)
(Unaudited)
Thirteen Weeks Ended Thirty-Nine Weeks Ended
----------------------- ------------------------
September September
26, 2004 26, 2004
September (as September (as
25, 2005 restated) 25, 2005 restated)
----------- ----------- ----------- -----------
Restaurant sales $ 63,679 $ 60,899 $ 203,308 $ 189,219
Restaurant costs:
Product 16,262 15,502 52,304 48,257
Labor 22,107 20,899 68,017 63,665
Direct and
occupancy 20,909 19,455 61,501 57,953
Depreciation and
amortization 3,560 3,892 10,869 11,408
----------- ----------- ----------- -----------
Total restaurant
costs 62,838 59,748 192,691 181,283
General and
administrative
expenses 6,746 4,430 18,873 13,094
Pre-opening costs - 513 244 988
Loss on impairment and
sale of long-lived
assets 13,278 10,194 13,718 10,194
Lease termination
costs 160 4 234 1,175
----------- ----------- ----------- -----------
Operating loss (19,343) (13,990) (22,452) (17,515)
Interest income 40 4 92 70
Interest expense (787) (472) (2,255) (1,530)
Loss on early
extinguishment of
debt (675) - (675) (524)
----------- ----------- ----------- -----------
Loss before income
taxes (20,765) (14,458) (25,290) (19,499)
Income taxes - - - -
----------- ----------- ----------- -----------
Net loss $ (20,765) $ (14,458) $ (25,290) $ (19,499)
=========== =========== =========== ===========
Net loss per share
- basic $ (1.03) $ (0.72) $ (1.25) $ (1.00)
Weighted average
common shares
outstanding
- basic 20,223,749 20,150,065 20,206,579 19,419,106
Net loss per share
- diluted $ (1.03) $ (0.72) $ (1.25) $ (1.00)
Weighted average
common shares
outstanding diluted 20,223,749 20,150,065 20,206,579 19,419,106
BUCA, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
(in thousands, except share data)
(Unaudited)
September 25, December 26,
2005 2004
------------- ------------
ASSETS
Current assets:
Cash and cash equivalents $ 1,554 $ 4,314
Accounts receivable 3,513 2,796
Inventories 6,849 7,379
Prepaid expenses and other 3,139 4,486
------------- ------------
Total current assets 15,055 18,975
Property, equipment and leasehold
improvements, net 133,270 157,921
Other assets 5,718 6,349
------------- ------------
$ 154,043 $ 183,245
============= ============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 11,694 $ 13,840
Accrued gift cards and certificates 1,478 4,747
Accrued payroll and benefits 7,919 7,542
Accrued sales, property and income tax 3,453 3,590
Other accrued expenses 4,540 6,167
Line of credit borrowings 5,869 1,986
Current maturities of long-term debt
and capitalized leases 1,368 1,368
------------- ------------
Total current liabilities 36,321 39,240
Long-term liabilities:
Long-term debt and capital leases, less
current maturities 17,711 19,579
Deferred rent 18,210 18,236
Other liabilities, net 3,680 3,113
------------- ------------
Total liabilities 75,922 80,168
Commitments and contingencies
Shareholders' equity:
Undesignated stock, 5,000,000 shares
authorized, none issued or outstanding
Common stock, $.01 par value per share,
30,000,000 shares authorized;
20,503,537 and 20,186,059 shares
issued and outstanding, respectively 205 202
Additional paid-in capital 170,746 169,112
Accumulated deficit (90,402) (65,122)
------------- ------------
80,549 104,192
Unearned compensation (1,405) -
Notes receivable from employee
shareholders (1,023) (1,115)
------------- ------------
Total shareholders' equity 78,121 103,077
------------- ------------
$ 154,043 $ 183,245
============= ============
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