CEC Entertainment, Inc. Reports First Quarter Results.IRVING, Texas Irving (pronounced 'er-ving') is a city located in the U.S. state of Texas within Dallas County. According to the 2000 U.S. Census, the city population was 191,615; the 2006 estimate was 201,927 according to the North Central Texas Council of Governments, and 196,084 according to -- CEC (Central Electronic Complex) The set of hardware that defines a mainframe, which includes the CPU(s), memory, channels, controllers and power supplies included in the box. Some CECs, such as IBM's Multiprise 2000 and 3000, include data storage devices as well. Entertainment, Inc. (NYSE NYSE See: New York Stock Exchange :CEC) today announced earnings for the first quarter ended April 2, 2006. Revenues for the first quarter of 2006 increased to $227.0 million from $214.1 million in the first quarter of 2005. Net income in the first quarter of 2006 decreased to $29.2 million from $31.3 million in the same period of 2005. 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 in the first quarter of 2006 were $0.85 per share compared to $0.84 per share in the first quarter of 2005. Chris CHRIS Chemical Hazards Response Information System (US DoD) CHRIS California Historical Resources Information System CHRIS Computerized Human Resources Information System CHRIS Command Human Resources Intelligence System Morris, Executive Vice President and Chief Financial Officer stated that, "Total revenues increased 6.0% in the first quarter of 2006 over the same period of the prior year due to new store development and an increase in comparable store sales of 1.2%. During the first quarter of 2006, the Company generated operating cash flow Operating cash flow Earnings before depreciation minus taxes. Measures the cash generated from operations, not counting capital spending or working capital requirements. of $60 million, invested $19 million primarily in new and existing stores and repurchased $10 million of its common stock while reducing outstanding borrowings on our credit facility to $105 million at the end of the quarter." Mr. Morris further added, "Based on current estimates, we expect diluted earnings per share to range from $0.37 to $0.39 per share for the second quarter of 2006 and from $1.94 to $2.02 per share for the year. Expected diluted earnings per share for the year are unchanged from prior guidance." Richard Ri·chard , Joseph Henri Maurice Known as "Rocket." 1921-2000. Canadian hockey player. A right wing for the Montreal Canadiens (1942-1960), he led his team to eight Stanley Cup championships and was the first player to score 50 goals in a M. Frank, Chairman and Chief Executive Officer stated that, "The Company remains financially strong which gives us the opportunity to effectively execute To run a program, which causes the computer to carry out its instructions. See executable code, instruction and EXE file. execute - execution our comprehensive business plan and create 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. shareholder value. We are confident in our strategies and have the talented and motivated mo·ti·vate tr.v. mo·ti·vat·ed, mo·ti·vat·ing, mo·ti·vates To provide with an incentive; move to action; impel. mo people to execute them. We believe quality execution of our long-term strategies of improving our product through an aggressive capital plan, enhancing our value and experience for our guest, reinforced re·in·force also re-en·force or re·en·force tr.v. re·in·forced, re·in·forc·ing, re·in·forc·es 1. To give more force or effectiveness to; strengthen: The news reinforced her hopes. with effective advertising, quality new store development, coupled with operational execution and strategically repurchasing Company stock will drive long-term shareholder value." Certain statements in this press release, other than historical information, may be considered 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. , within the meaning of the "safe harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. " provisions of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995, and is subject to various risks, uncertainties and assumptions. Should one or more of these risks or uncertainties materialize ma·te·ri·al·ize v. ma·te·ri·al·ized, ma·te·ri·al·iz·ing, ma·te·ri·al·iz·es v.tr. 1. To cause to become real or actual: By building the house, we materialized a dream. , or should underlying assumptions prove incorrect Incorrect means to not be correct and may also refer to:
CEC Entertainment, Inc. operates a system of 522 Chuck E. Cheese's <noinclude></noinclude> Chuck E. Cheese's is a chain of family entertainment centers. The concept centers around a basic sit-down pizza restaurant, complemented by arcade games, small rides, animatronic characters, and other popular diversions for young restaurants in 48 states, of which 477 are owned and operated by the Company.
CEC ENTERTAINMENT, INC.
CONDENSED CONSOLIDATED RESULTS OF OPERATIONS
(Thousands, except per share data)
Quarter Ended
04/02/06 04/03/05
--------- ---------
Revenues:
Food and beverage $148,600 $139,044
Games and merchandise 77,506 74,242
Franchise fees and royalties 884 795
Interest income 2 5
--------- ---------
226,992 214,086
Costs and expenses:
Cost of sales:
Food, beverage and related 27,422 25,568
Games and merchandise 10,062 8,324
Labor 59,626 53,825
--------- ---------
97,110 87,717
Selling, general and administrative expenses 28,672 26,894
Depreciation and amortization 15,919 14,397
Interest expense 1,703 723
Other operating expenses 36,610 33,555
--------- ---------
180,014 163,286
Income before income taxes 46,978 50,800
Income taxes 17,758 19,457
--------- ---------
Net income $29,220 $31,343
========= =========
Earnings per share:
Basic $.87 $.86
Diluted $.85 $.84
Weighted average shares outstanding:
Basic 33,719 36,355
Diluted 34,517 37,451
CEC ENTERTAINMENT, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Thousands, except share amounts)
April 2, January 1,
2006 2006
----------- -----------
(unaudited)
ASSETS
Current assets:
Cash and cash equivalents $15,689 $12,184
Accounts receivable 19,652 20,323
Inventories 12,799 13,659
Prepaid expenses 9,746 7,882
Deferred tax asset 1,824 1,824
----------- -----------
Total current assets 59,710 55,872
----------- -----------
Property and equipment, net 594,550 592,255
----------- -----------
Other assets 1,762 2,201
----------- -----------
$656,022 $650,328
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt $599 $594
Accounts payable 20,932 30,264
Accrued liabilities 48,222 27,791
----------- -----------
Total current liabilities 69,753 58,649
----------- -----------
Long-term debt, less current portion 116,729 148,974
----------- -----------
Deferred rent 63,974 61,877
----------- -----------
Deferred tax liability 15,451 17,001
----------- -----------
Accrued insurance 17,000 17,000
----------- -----------
Shareholders' equity:
Common stock, $.10 par value; authorized
100,000,000 shares; 56,591,613 and
56,115,658 shares issued, respectively 5,659 5,612
Capital in excess of par value 327,220 312,863
Retained earnings 497,618 468,398
Accumulated other comprehensive income 2,467 2,446
Less treasury shares of 22,821,415 and
22,499,815, respectively, at cost (452,934) (442,492)
Deferred compensation (6,915) 0
----------- -----------
373,115 346,827
----------- -----------
$656,022 $650,328
=========== ===========
CEC ENTERTAINMENT, INC.
SUPPLEMENTAL FINANCIAL INFORMATION
(Thousands)
Quarter Ended
04/02/06 04/03/05
Number of Company-owned stores:
Beginning of period 475 449
New 3 4
Closed (1)
--------- ---------
End of period 477 453
========= =========
Number of Franchised stores:
Beginning of period 44 46
New 1
Closed (1)
--------- ---------
End of period 45 45
========= =========
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