Buffalo Wild Wings, Inc. Announces Second Quarter Results; Earnings per diluted share of $0.15.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. -- Buffalo Wild Wings Buffalo Wild Wings Grill & Bar (also commonly referred to as B-Dubs) is a sports bar and restaurant franchise in the United States that is best-known for its buffalo wings. , Inc. (Nasdaq: BWLD), today announced financial results for the second quarter ended June June: see month. 27, 2004. Highlights for the second quarter compared to the same quarter a year ago were as follows: --Total revenue increased 35.9% to $39.6 million --Company-owned restaurant sales grew 35.9% to $35.3 million --System-wide same store sales Same Store Sales A statistic used in retail industry analysis. It compares sales of stores that have been open for a year or more. Notes: This statistic allows investors to determine what portion of new sales has come from sales growth and what portion from the opening of increased 10.4% --Earnings 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 increased to $0.15 from a loss of $.04 a year ago Sally Smith, Chief Executive Officer and President of Buffalo Wild Wings commented, "Our second quarter performance was characterized char·ac·ter·ize tr.v. character·ized, character·iz·ing, character·iz·es 1. To describe the qualities or peculiarities of: characterized the warden as ruthless. 2. by continued top-line growth, solid operations, and slightly lower chicken wing prices. These factors allowed us to exceed second quarter expectations." Smith continued, "In analyzing this quarter compared to the second quarter of 2003, our results benefited from a menu price increase and more units in operation, partially offset by higher wing prices. In addition, the second quarter of 2003 included an incremental Additional or increased growth, bulk, quantity, number, or value; enlarged. Incremental cost is additional or increased cost of an item or service apart from its actual cost. restaurant 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 $693,000. These items, combined with positive labor trends, added to our bottom-line bot·tom-line adj. 1. Concerned exclusively with costs and profits: bottom-line issues. 2. Ruthlessly realistic; pragmatic: a bottom-line political strategy. success." Total revenue, which includes company-owned restaurant sales and franchise royalties Not to be confused with Royal family. Royalties (sometimes, running royalties) are usage-based payments made by one party (the "licensee") to another (the "licensor") for ongoing use of an asset, most typically an intellectual property (IP) right. and fees, increased 35.9% to $39.6 million in the second quarter compared to $29.1 million in the second quarter of 2003. System-wide same store sales increased 10.4% for the quarter. Company-owned restaurant sales for the quarter increased 35.9% to $35.3 million aided by a company-owned same store sales increase of 10.6% and 18 more company-owned locations in operation at the end of second quarter 2004 relative to the same period in 2003. Franchise royalties and fees increased 36.6% to $4.3 million versus $3.1 million in the prior year. This increase was due to a franchised same store sales increase of 10.4% and 37 more franchised restaurants at the end of the period versus a year ago. Average weekly sales for company-owned restaurants were $30,184 for the second quarter of 2004 compared to $27,132 for the same quarter last year, an 11.2% increase. Franchised restaurants averaged $38,072 for the period versus $33,393 in the second quarter a year ago, a 14.0% increase. For the second quarter, earnings per diluted share increased to $0.15, versus a loss of $0.04 in the second quarter of 2003. During the quarter, Buffalo Wild Wings incurred compensation expense, net of tax, of $77,000 or $0.01 per diluted share related to its new restricted stock incentive program, which replaces stock options as the long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. equity incentive for the Company. Smith concluded, "We believe it may be difficult to sustain the level of same store sales increases in the second half of 2004 that we saw in the first and second quarters because system-wide same store sales in the third and fourth quarters of 2003 had increased 7.9% and 10.0%, respectively. However, we are excited about our marketing initiatives to drive same store sales during the remainder of the year. In terms of development, we remain on track to open 20 new company-owned and 45 franchised units by year-end year-end also year·end n. The end of a year. adj. Occurring or done at the end of the year: a year-end audit. Noun 1. . As always, we will continue to focus on efficient operations, brand building, and long-term returns for our shareholders." Third Quarter 2004 Outlook For the third quarter ended September September: see month. 26, 2004, management expects total revenue to approximate ap·prox·i·mate v. To bring together, as cut edges of tissue. adj. 1. Relating to the contact surfaces, either proximal or distal, of two adjacent teeth; proximate. 2. Close together. $41 million based on a system-wide same store sales increase of 4% to 6%. Revenue assumptions are also based on 4 new company-owned restaurants during the third quarter and 13 new franchised units. Management also believes that earnings per diluted share for the third quarter will range from $0.12 to $0.15. This is based on the previously mentioned revenue assumptions, average chicken wing prices for the third quarter of $1.40 per pound, stock-based compensation expense of $375,000, and diluted weighted average shares outstanding of 8.6 million. Included in this release is information regarding restaurant unit counts, same store sales, and average weekly sales volumes. Management believes such information is an important measure of our performance and is useful in assessing consumer acceptance of the Buffalo Wild Wings Grill Grill may refer to: In food:
As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). , should not be considered in isolation or as a substitute for other measures of performance prepared in accordance with GAAP and may not be comparable to sales measures as defined or used by other companies. The Company is hosting a conference call today, July July: see month. 22, 2004 at 5:00 p.m. EDT EDT abbr. Eastern Daylight Time EDT Eastern Daylight Time EDT n abbr (US) (= Eastern Daylight Time) → hora de verano de Nueva York EDT to discuss these results. There will be a simultaneous webcast conducted at the Company's website http://www.buffalowildwings.com. A replay of the call will be available until July 29, 2004. To access this replay please dial (973) 341-3080, password A secret word or code used to serve as a security measure against unauthorized access to data. It is normally managed by the operating system or DBMS. However, the computer can only verify the legitimacy of the password, not the legitimacy of the user. See NCSC. 4969241. About the Company: Buffalo Wild Wings, Inc., founded in 1982 and headquartered in Minneapolis, Minnesota “Minneapolis” redirects here. For other uses, see Minneapolis (disambiguation). Minneapolis (pronounced IPA: /ˌmɪniˈæpəlɪs/) is the largest city in the U.S. , is an established and growing owner, operator and franchisor of Buffalo Wild Wings Grill & Bar restaurants featuring a variety of boldly bold adj. bold·er, bold·est 1. Fearless and daring; courageous. 2. Requiring or exhibiting courage and bravery. See Synonyms at brave. 3. flavored fla·vor n. 1. Distinctive taste; savor: a flavor of smoke in bacon. See Synonyms at taste. 2. , made-to-order made-to-or·der adj. 1. Made in accordance with particular instructions or requirements; custom-made. 2. Very suitable: a made-to-order job. Adj. 1. menu items including Buffalo, New York-style chicken wings Chicken Wings can refer to:
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. Certain statements in this release that are not historical facts, including, without limitation, those relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc our anticipated financial performance and expected store openings for the third quarter of 2004 and the remainder of the year, are forward-looking statements that involve risks and uncertainties. Such statements are based upon the current beliefs and expectations of the management of the Company. Actual results may vary materially from those contained in forward-looking statements based on a number of factors including, without limitation, the actual number of locations opening during the third quarter of 2004 and the remainder of the year, the sales at these and our other company-owned and franchised locations, the cost of wings, the success of our marketing initiatives, our ability to control other restaurant operating costs operating costs npl → gastos mpl operacionales and other factors disclosed dis·close tr.v. dis·closed, dis·clos·ing, dis·clos·es 1. To expose to view, as by removing a cover; uncover. 2. To make known (something heretofore kept secret). from time to time in the Company's filings with the U.S. Securities and Exchange Commission. Investors should take such risks into account when making investment decisions. Shareholders and other readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date on which they are made. The Company undertakes no obligation to update any forward-looking statements.
BUFFALO WILD WINGS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
(Dollar amounts in thousands except share and per share data)
(unaudited)
Three months ended Six months ended
-------------------- -------------------
June 29, June 27, June 29, June 27,
2003 2004 2003 2004
---------- --------- -------- ----------
Revenue:
Restaurant sales $ 25,974 35,291 52,561 71,217
Franchise royalties and
fees 3,120 4,261 6,108 8,518
---------- ---------- --------- -------
Total revenue 29,094 39,552 58,669 79,735
---------- ----------- --------- -------
Costs and expenses:
Restaurant operating
costs:
Cost of sales 8,087 12,342 16,215 24,769
Labor 7,662 10,095 15,437 20,054
Operating 3,939 5,358 8,221 10,780
Occupancy 1,929 2,582 3,721 4,875
Depreciation 1,732 2,156 3,380 4,189
General and administrative 4,238 4,442 7,879 8,496
Stock-based compensation -- 127 -- 127
Preopening 76 451 356 794
Restaurant closures and
impairment 721 28 722 39
------------ --------- --------- -------
Total costs and
expenses 28,384 37,581 55,931 74,123
------------ --------- --------- -------
Income from operations 710 1,971 2,738 5,612
------------ --------- ---------- ------
Other income (expense):
Interest expense (270) -- (522) --
Interest income 21 155 33 288
------------ --------- --------- -------
(249) 155 (489) 288
------------ ---------- -------- -------
Earnings before income taxes 461 2,126 2,249 5,900
Income tax expense 180 829 877 2,301
------------ ---------- -------- -------
Net earnings 281 1,297 1,372 3,599
Accretion resulting from
cumulative dividend and
mandatory redemption feature
of preferred Stock 402 -- 803 --
------------ ----------- -------- ------
Net earnings
available to
common
stockholders $ (121) 1,297 569 3,599
=========== ========= ========= ========
Earnings per common share--
basic $ (0.04) 0.16 0.22 0.45
Earnings per common share--
diluted (0.04) 0.15 0.18 0.42
Weighted average shares
outstanding --basic 2,719,513 8,096,981 2,635,887 8,044,525
Weighted average shares
outstanding --diluted 2,719,513 8,575,186 3,225,737 8,565,395
The following table expresses results of operations as a percentage of total revenue for the periods presented, except for restaurant operating costs which are expressed as a percentage of restaurant sales:
Three months
ended
--------------
June June
29, 27,
2003 2004
Revenue: ------- ------
Restaurant sales 89.3% 89.2%
Franchising royalties and fees 10.7 10.8
-------- -------
Total revenue 100.0 100.0
-------- -------
Costs and expenses:
Restaurant operating costs:
Cost of sales 31.1 35.0
Labor 29.5 28.6
Operating 15.2 15.2
Occupancy 7.4 7.3
Depreciation 6.0 5.5
General and administrative 14.6 11.2
Stock-based compensation 0.0 0.3
Preopening 0.3 1.1
Restaurant closures and asset impairment 2.5 0.1
-------- ------
Total costs and expenses 97.6 95.0
-------- -------
Income from operations 2.4% 5.0%
-------- -------
Other income (expense):
Interest expense (0.9 )% 0.0%
Interest income 0.1 0.4
-------- ------
Total other income (expense) (0.9 ) 0.4
-------- ------
Earnings before income taxes 1.6 5.4
Income tax expense 0.6 2.1
-------- ------
Net earnings 1.0 3.3
Accretion resulting from cumulative dividend and
mandatory redemption feature of preferred stock 1.4 0.0
-------- ------
Net earnings available to common
stockholders (0.4 )% 3.3%
====== ======
BUFFALO WILD WINGS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Dollar amounts in thousands, except share data)
(unaudited)
December 28, June 27,
2003 2004
-------- --------
Assets
Current assets:
Cash and cash equivalents $ 49,538 29,822
Marketable securities -- 16,945
Accounts receivable--franchisees, net of
allowance of $25 694 661
Accounts receivable--other 1,634 2,252
Inventory 978 940
Income taxes receivable 367 338
Prepaid expenses 1,230 939
Deferred income taxes 1,222 1,222
-------- --------
Total current assets 55,663 53,119
Property and equipment, net 44,450 50,980
Restricted cash 2,425 3,608
Other assets 702 785
Goodwill 759 759
-------- --------
Total assets $103,999 109,251
======== ========
Liabilities and Stockholders' Equity
Current liabilities:
Unearned franchise fees $ 1,959 2,142
Accounts payable 4,941 4,574
Accrued compensation and benefits 4,670 4,865
Accrued expenses 3,580 2,757
Current portion of deferred lease credits 491 484
-------- --------
Total current liabilities 15,641 14,822
Long-term liabilities:
Marketing fund payables 2,425 3,608
Deferred income taxes 4,733 4,946
Deferred lease credits, net of current portion 6,133 6,106
-------- --------
Total liabilities 28,932 29,482
Commitments and contingencies (note 6)
Common stockholders' equity:
Undesignated stock, 5,600,000 shares authorized -- --
Common stock, no par value. Authorized 15,600,000
shares; issued and outstanding 7,981,945 and
8,220,321, respectively 66,235 68,102
Unamoritized value of restricted stock -- (764)
Retained earnings 8,832 12,431
-------- --------
Total common stockholders' equity 75,067 79,769
-------- --------
Total liabilities and stockholders' equity $103,999 $109,251
======== ========
BUFFALO WILD WINGS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollar amounts in thousands)
(unaudited)
Three months Six months
ended ended
--------------- --------------
June June June June
29, 27, 29, 27,
2003 2004 2003 2004
--------------- --------------
Cash flows from operating activities:
Net earnings $ 281 1,297 1,372 3,599
Adjustments to reconcile net
earnings to cash provided by
operations:
Depreciation 1,732 2,156 3,380 4,189
Amortization -- 72 -- 72
Restaurant closures and
impairment 721 28 722 39
Deferred lease credits (50) (456) (85) (554)
Deferred income taxes 74 128 74 213
Stock-based compensation -- 127 -- 127
Change in operating assets
and liabilities:
Accounts receivable (322) 412 1,318 (681)
Inventory 48 166 (16) 38
Prepaid expenses (72) 45 (571) 291
Other assets (29) (68) 2 (73)
Unearned franchise fees (150) (218) 304 183
Accounts payable (4) (243)(1,502) (367)
Income taxes (535) (1,130) 1,039 29
Accrued expenses 885 146 (558) (628)
-------- ------- ------ ------
Net cash provided by
operating activities 2,579 2,462 5,479 6,477
-------- ------- ------ ------
Cash flows from investing activities:
Acquisition of property and
equipment (1,623) (4,800)(2,864)(10,768)
Purchase of marketable securities -- (17,017) -- (17,017)
------- ------- ------ -------
Net cash used in
investing activities (1,623)(21,817)(2,864)(27,785)
------- ------- ------ -------
Cash flows from financing activities:
Issuance of common stock 473 791 528 976
Payments on notes payable (50) -- (100) --
Payments on capital lease
obligations (1,104) -- (2,126) --
Proceeds from lessors 521 553 522 616
-------- ------ ------- -----
Net cash provided by
(used in) financing
activities (160) 1,344 (1,176) 1,592
-------- ----- -------- ------
Net increase
(decrease) in cash
and cash equivalents 796 (18,011) 1,439 (19,716)
Cash and cash equivalents at beginning
of period 5,295 47,833 4,652 49,538
------- ------- ------ -------
Cash and cash equivalents at end of
period $ 6,091 29,822 6,091 29,822
======= ======= ====== =======
BUFFALO WILD WINGS, INC. AND SUBSIDIARIES
Supplemental Information
Restaurant Count
Company-owned Restaurants:
Q1 Q2 Q3 Q4
----- ------ ------ ------
2004 88 92
2003 73 74 77 84
2002 56 60 63 70
2001 45 47 48 53
2000 29 33 39 42
Franchised Restaurants:
Q1 Q2 Q3 Q4
----- ------ ------ -----
2004 168 175
2003 131 138 142 161
2002 108 119 123 129
2001 95 97 100 105
2000 85 87 89 95
System-wide Restaurants:
Q1 Q2 Q3 Q4
----- ------ ------ ------
2004 256 267
2003 204 212 219 245
2002 164 179 186 199
2001 140 144 148 158
2000 114 120 128 137
Quarterly Same Store Sales
Company-owned Restaurants:
Q1 Q2 Q3 Q4 Year
-------- -------- -------- ------- ------
2004 11.1% 10.6%
2003 (1.4%) 2.7% 6.7% 8.5% 4.3%
2002 5.6% 4.6% (0.7%) (1.8%) 1.6%
2001 9.1% 7.0% 6.4% 12.1% 8.8%
2000 11.1% 13.2% 12.6% 8.2% 11.0%
Franchised Restaurants:
Q1 Q2 Q3 Q4 Year
------ ------- ------ ------ -------
2004 12.0% 10.4%
2003 (0.4%) 2.3% 8.5% 10.7% 5.6%
2002 4.2% 4.5% 0.0% (1.8%) 1.5%
2001 4.3% 3.7% 5.3% 8.4% 5.5%
2000 7.8% 6.0% 6.1% 3.0% 5.6%
System-wide Restaurants:
Q1 Q2 Q3 Q4 Year
------ ------ ------ ------- --------
2004 11.8% 10.4%
2003 (0.7%) 2.4% 7.9% 10.0% 5.2%
2002 4.7% 4.5% (0.2%) (1.8%) 1.6%
2001 5.4% 4.5% 5.6% 9.4% 6.4%
2000 8.4% 7.4% 7.6% 4.2% 6.8%
BUFFALO WILD WINGS, INC. AND SUBSIDIARIES
Supplemental Information
Average Weekly Sales Volumes
Company-owned Restaurants:
Q1 Q2 Q3 Q4 Year
------ ---------- --------- -------- --------
2004 $32,289 $30,184
2003 28,782 27,132 28,281 31,171 28,886
2002 29,564 26,330 25,916 28,466 27,547
2001 27,675 25,644 26,722 29,426 27,382
2000 28,183 25,144 25,498 26,287 26,227
Franchised Restaurants:
Q1 Q2 Q3 Q4 Year
-------- -------- -------- -------- --------
2004 $39,678 $38,072
2003 33,920 33,393 35,289 39,014 35,491
2002 32,956 31,623 31,619 34,023 32,574
2001 30,533 28,820 29,835 33,267 30,652
2000 28,546 27,303 28,388 29,951 28,569
System-wide Restaurants:
Q1 Q2 Q3 Q4 Year
------- -------- -------- ------- ---------
2004 $37,124 $35,297
2003 32,093 31,154 32,779 36,223 33,134
2002 31,781 29,829 29,651 32,124 30,850
2001 29,639 27,774 28,788 32,007 29,583
2000 28,454 26,717 27,544 28,799 27,904
Average Quarterly Wing Prices Per Pound
Q1 Q2 Q3 Q4 Year
------- ------- ------- ------ -------
2004 $1.49 $1.46
2003 1.01 1.02 1.00 1.21 1.06
2002 1.11 .87 .84 .78 .89
2001 1.14 1.22 1.22 1.16 1.18
2000 .87 .79 .86 1.00 .89
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