Benihana Inc. Reports Record High Fourth Quarter and Full Year Results.

MIAMI--(BUSINESS WIRE)--May 11, 1999--

Benihana Inc. (NASDAQ: BNHN and BNHNA), which owns 51 teppenyaki style and sushi Japanese theme restaurants throughout the U.S., and franchises 12 others, today reported record high operating results for the fourth quarter and year ended March 28, 1999.

For the fourth quarter, revenues increased to $30,085,000, compared with $26,880,000 in the corresponding year-earlier period, a gain of 12%. Gross profit rose to $22,268,000, from $19,836,000 in the fourth quarter of 1998, up 12%, and EBITDA (earnings before depreciation, interest, taxes, depreciation and amortization) rose 33.1% to $5,064,000. The favorable 1999 fourth quarter results included reduced labor expenses and reflected a 9.9% company wide increase in customer count. Net income climbed 53%, to $2,452,000, or 38 cents per fully diluted share, compared with $1,598,000, or 25 cents per fully diluted share, in the corresponding year-earlier period.

For the 12 months ended March 28, 1999, revenues hit an all-time peak of $119,149,000, compared with $99,757,000 in the prior year, a gain of 19%. EBITDA amounted to $15,529,000, compared with $12,938,000 in fiscal 1998, a gain of 20%. Net income rose to $6,518,000, or $1.02 per fully diluted share, up 10% from $5,940,000, or 93 cents per fully diluted share, in fiscal 1998. In addition Benihana ended the year with reduced long-term debt, to $10,672,000 compared with $15,407,000 at the fiscal 1998 year-end, and record stockholders equity of $34,699,000.

"Our Company's strong second half showing, which produced the best yearly results in the company's history, is a reflection of our ongoing successful efforts to rationally expand our chain of restaurants and broaden their appeal to more customers," said Joel A. Schwartz, president.

Mr. Schwartz said that the favorable results reflected several factors, including strong gains across the board in customer counts and sales at the restaurants acquired with the December 1997 purchase of Rudy's Restaurants Group and at traditional Benihana restaurants opened for more than a year. Eight of the nine Samurai and Kyoto restaurants which formed the Rudy's chain have been rebranded to "Benihana" restaurants although all nine have been upgraded to Benihana's service and quality standards, and the resultant increase in customer count and sales are now in line with expectations.

In addition, results benefited slightly in the fourth quarter from the late fall opening in Ontario, CA, of the newest traditional Benihana restaurant. "The Ontario Benihana restaurant is performing well in excess of our expectations," said Mr. Schwartz.

Fiscal 2000 is off to a good start, Mr. Schwartz added. Through the first four weeks of operations, ended April 25th, comparable sales increased 9.3%, and same store sales at the acquired units rose 10.6%.

During the past year, Benihana announced new franchise agreements with investor groups in Anchorage, Alaska, and in Lima, Peru, where two new restaurants are targeted. A franchised Benihana restaurant also opened during the year in Austin, Texas. Total franchised restaurants, including those being built, now number 12. Among the franchised restaurants, two are scheduled to open in 2000.

Benihana also recently announced plans to open two new traditional Teppenyaki restaurants early next year in California, in Santa Monica and Monterey. "We expect to grow our Company both from within and, when the opportunities arise, via acquisitions," said Mr. Schwartz. "We also are continually upgrading and refurbishing our existing restaurants in order to provide our customers with the most enjoyable dining experience. The outlook for continued growth is very promising."

In a teppenyaki restaurant, Japanese style food is prepared by a chef at a grill built into the table where the food is served, around which six to eight people are typically seated. In addition to the teppenyaki restaurants, Benihana also operates Sushi Doraku by Benihana sushi restaurants, one of which is in operation and two are under construction.

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" 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.