Benihana Inc. Reports First Fiscal Quarter Operating Results.Business Editors MIAMI--(BUSINESS WIRE)--Aug. 23, 2002 Benihana Inc. (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on :BNHNA and BNHN) operator of one of the nation's largest chains of Asian restaurants, today announced operating results for the first fiscal quarter ended July 21, 2002. For the quarter, total sales amounted to $57.2 million, compared with $50.9 million in the corresponding year-earlier period, a gain of 12.2%. Net income amounted to $2.8 million, compared with $2.4 million in the corresponding year-earlier period, an increase of 14.0%. Per 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. share net income amounted to $0.30, based on 9.4 million average shares and equivalents outstanding, compared with $0.33, based on 7.5 million average shares and equivalents outstanding a year ago. Per share figures are adjusted for the recent 15% stock dividend of Class A shares. The greater number of outstanding average shares and equivalents reflects a 1 million Class A common share public offering in December 2001, as well as the option exercises and the effect of higher stock price on the computation Computation is a general term for any type of information processing that can be represented mathematically. This includes phenomena ranging from simple calculations to human thinking. . Proceeds from the equity offering have initially been applied to reduce current debt under the current "revolving line of credit Revolving line of credit A bank line of credit on which the customer pays a commitment fee and can take and repay funds at will. Normally a revolving LOC involves a firm commitment from the bank for a period of several years. ". Comparable restaurant sales for the first fiscal quarter increased 5.3% from the corresponding year earlier period. Gross profit for the first quarter of fiscal 2003 amounted to $42.7 million, compared with $37.2 million a year earlier, with gross profit margins Gross profit margin Gross profit divided by sales, which is equal to each sales dollar left over after paying for the cost of goods sold. gross profit margin A measure calculated by dividing gross profit by net sales. at 75.3% and 73.8%, respectively. Restaurant operating profit Operating profit (or loss) Revenue from a firm's regular activities less costs and expenses and before income deductions. operating profit See operating income. amounted to $9 million, compared with $8.5 million in the corresponding year-earlier period, a 5.3% increase. Restaurant operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. were $33.8 million, compared with $28.7 million in the corresponding year-earlier period, including labor and related costs of $21.3 million, compared with $17.9 million a year ago. The increase in labor and related costs reflected both a rise in the number and amounts of claims in the Company's self-insured self-insured Self fund Health insurance adjective Referring to the practice of carrying an individual health insurance policy for oneself; self insurance is usually more expensive than group insurance health plan, as well as recently legislated increases in minimum wages in California California (kăl'ĭfôr`nyə), most populous state in the United States, located in the Far West; bordered by Oregon (N), Nevada and, across the Colorado River, Arizona (E), Mexico (S), and the Pacific Ocean (W). where the Company operates 14 restaurants. The Company intends to increase the contribution amount that covered employees are required to make under the self insured plan. To compensate for the wage increases the Company has instituted menu price increases in selected markets. Sales growth in the quarter was negatively affected by later than anticipated completion of one restaurant undergoing remodeling remodeling /re·mod·el·ing/ (re-mod´el-ing) reorganization or renovation of an old structure. bone remodeling and a new restaurant opening. The effect was a loss of approximately 11 store weeks. In addition, 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 , and depreciation and amortization expenses increased related to new restaurants. Sales at the five-unit Haru sushi restaurants in New York City New York City: see New York, city. New York City City (pop., 2000: 8,008,278), southeastern New York, at the mouth of the Hudson River. The largest city in the U.S. , three of which were under development a year earlier, increased 93.8%, to $6.2 million. Benihana teppanyaki restaurant sales increased $3.4 million, to $50 million. Total customer count for the first fiscal quarter this year increased 9.5%, to 2.3 million. Last week, Benihana announced plans for a new teppanyaki restaurant in Carlsbad, in southern California Southern California, also colloquially known as SoCal, is the southern portion of the U.S. state of California. Centered on the cities of Los Angeles and San Diego, Southern California is home to nearly 24 million people and is the nation's second most populated region, . The new company-owned Carlsbad restaurant brings to 64 the number of restaurants the Company currently operates or has under development, including 57 teppanyaki restaurants. New company-owned Benihana teppanyaki restaurants are now being developed in Westbury, New York Westbury is a village in Nassau County, New York in the United States. The population was 14,263 at the 2000 census. The Village of Westbury is in the Town of North Hempstead. , and Scottsdale, Arizona Scottsdale (O'odham Vaṣai S-vaṣonĭ) is a city in Maricopa County, Arizona, United States, adjacent to Phoenix. Scottsdale has become internationally recognized as a premier and posh tourist destination, while maintaining its own identity and culture as " . The Company also announced three new franchise agreements last week, including restaurants slated for Broomfield, Colorado The City and County of Broomfield lies in the northwestern tier of the Denver metropolitan area in the State of Colorado of the United States. Broomfield has a consolidated city and county government. , near Boulder Boulder, city, United States Boulder, city (1990 pop. 83,312), seat of Boulder co., N central Colo.; inc. 1871. A Rocky Mountain resort and a suburb of Denver, it is the seat of the Univ. of Colorado (1876). , the West Indies West Indies, archipelago, between North and South America, curving c.2,500 mi (4,020 km) from Florida to the coast of Venezuela and separating the Caribbean Sea and the Gulf of Mexico from the Atlantic Ocean. island of Trinidad and Santiago, Chile Santiago, officially Santiago de Chile (Spanish: (helpinfo)), is the capital of Chile, and the center of its largest conurbation (Greater Santiago). . A total of 22 franchised Benihana teppanyaki restaurants will now be open or under development. "We expect fiscal 2003 to be another year of growth," said Joel A. Schwartz, Benihana President. "Sales and customer traffic continue satisfactorily, and our focus is on further strengthening our performance. We plan to continue to capitalize on Cap´i`tal`ize on` v. t. 1. To turn (an opportunity) to one's advantage; to take advantage of (a situation); to profit from; as, to capitalize on an opponent's mistakes s>. the strong Benihana brand in a disciplined but aggressive manner that will build value and enhance our Company's near and long term growth." About Benihana Benihana, now in its 38th year since its founding, and one of the nation's largest chains of Asian restaurants, currently operates 61 restaurants nationwide, including 54 Benihana teppanyaki restaurants, five Haru sushi restaurants and two Doraku restaurants. Three Benihana teppanyaki restaurants are currently under construction. In addition, Benihana has 18 franchised teppanyaki restaurants in the U.S. and Latin America Latin America, the Spanish-speaking, Portuguese-speaking, and French-speaking countries (except Canada) of North America, South America, Central America, and the West Indies. . Statements in this press release concerning the Company's business outlook or future economic performance, anticipated profitability, revenues, expenses or other financial items, together with other statements that are not historical facts, are "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. " as that term is defined under Federal Securities Laws. "Forward-looking statements" are subject to risks, uncertainties and other factors which could cause actual results to differ materially from those stated in such statements. Such risks, uncertainties and factors include, but are not limited to, changes in customers' tastes and preferences, acceptance of the Company's concepts in new locations, obtaining qualified personnel, industry cyclicality, fluctuations in customer demand, the seasonal nature of the business, fluctuations of commodities costs, the ability to complete construction of new units in a timely manner, obtaining governmental permits on a reasonably timely basis, and general economic conditions, as well as other risks detailed in the Company's filings with the Securities and Exchange Commission. The Company disclaims any obligations to update any forward-looking statement as a result of developments occurring after the date of this press release. A conference call conducted by Benihana Inc. management will take place on August 23, 2002 at 11:00 A.M. (ET). You may listen over the Internet through World Investor Broadcast Link's Vcall website, located at http://www.vcall.com. To listen to the live call on the Internet, please go to the web site at least fifteen minutes early to register, download To receive a file transmitted over a network. In any communications session, "download" means receive, and "upload" means send. The download/upload often implies a big/little scenario, in which data is being downloaded from the "big" server into the "little" user's computer. and install any necessary audio software. For those who cannot listen to the live broadcast, a replay will be available through midnight September 8, 2002, shortly following the live call. For replay, dial 1-888-298-2157. You will be prompted for PIN number 3445384. (table follows)
Benihana Inc.
Consolidated Statements of Operations
(Unaudited)
Four Periods Ended
(amounts in thousands except per share data)
%
July 21, July 22, Change Change
2002 2001
Restaurant sales $56,723 $50,466 $6,257 12.4%
Franchise revenues 436 469 (33) -7.0%
------------------------------------
57,159 50,935 6,224 12.2%
Cost of sales 13,990 13,226 764 5.8%
Gross profit 42,733 37,240 5,493 14.8%
Restaurant operating expenses:
Labor and related costs 21,300 17,931 3,369 18.8%
Restaurant supplies 1,066 953 113 11.9%
Credit card discounts 969 852 117 13.7%
Utilities 1,267 1,173 94 8.0%
Occupancy costs 3,192 2,783 409 14.7%
Depreciation and amortization 1,921 1,446 475 32.8%
Other restaurant operating expenses 4,037 3,573 464 13.0%
------------------------------------
Total 33,752 28,711 5,041 17.6%
------------------------------------
Restaurant operating profit 8,981 8,529 452 5.3%
Restaurant opening costs 148 687 (539) -78.5%
Marketing, general and
administrative 4,796 4,351 445 10.2%
Interest 117 339 (222) -65.5%
Minority interest 157 (7) 164 N/A
------------------------------------
Income before income taxes 4,199 3,628 571 15.7%
Income taxes 1,409 1,181 228 19.3%
------------------------------------
Net income $2,790 $2,447 $343 14.0%
====================================
Earnings per share, diluted $0.30 $0.33 ($0.03) -9.1%
====================================
Earnings per share, basic $0.32 $0.34 ($0.02) -5.9%
====================================
Shares and equivalents outstanding 9,436 7,501
Sales by concept:
Benihana teppanyaki $50,027 $46,600 $3,427 7.4%
Haru 6,195 3,196 2,999 93.8%
Sushi Doraku 501 670 (169) -25.2%
Other data:
Ebitda(1) $6,314 $5,504 $810 14.7%
(1) "Ebitda, or earnings before interest, taxes on income and
depreciation and amortization is a common measurement used by
financial statement users to compare one company's performance to
another's before considering financing and tax structure and
depreciation and amortization policies. EBITDA is not intended to
represent cash flow from operations as defined by accounting
principles generally accepted in the United States of America and may
not be comparable among different companies of computational and
classification differences."
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