California Pizza Kitchen Reports Financial Results for the Second Quarter Ended July 1, 2001.Business Editors LOS LOS Length of stay, see there ANGELES--(BUSINESS WIRE)--July 23, 2001 California Pizza Kitchen California Pizza Kitchen (NASDAQ: CPKI, known within the food industry as CPK) is a casual dining restaurant chain that specializes in California-style pizza. The restaurant was started in 1985 by attorneys Rick Rosenfield and Larry Flax in Beverly Hills, California, , Inc. (Nasdaq:CPKI CPKI California Pizza Kitchen, Inc ) today reported revenues and earnings for the second quarter and six months ended July July: see month. 1, 2001. Highlights for the quarter compared to the same quarter for the prior year were as follows: -- Total revenues of $60.3 million compared to $52.6 million in the second quarter of 2000 -- Operating income before pre-opening of $5.7 million compared to operating income before pre-opening and non-recurring compensation of $4.7 million in the second quarter of 2000 -- Fully diluted net income per share of $.18, compared to pro-forma fully diluted net income per share of $.16 for the second quarter of 2000 -- Comparable restaurant sales up 3.3% During the second quarter, the Company opened five new full service restaurants (Valley Fair, San Jose San Jose, city, United States San Jose (sănəzā`, săn hōzā`), city (1990 pop. 782,248), seat of Santa Clara co., W central Calif.; founded 1777, inc. 1850. , CA; Creve Coeur Creve Coeur (derived from French for "broken heart") is either:
Louis, 1682–1712, titular duke of Burgundy; grandson of King Louis XIV of France. He became heir to the throne on the death (1711) of his father, Louis the Great Dauphin. , MO; Easton Town Center Easton Town Center ("Easton") is a large mixed-use center in Columbus, Ohio, USA. It is designed to look like a classic American main street, with public spaces, fountains, a street grid, and metered storefront parking. , Columbus Columbus. 1 City (1990 pop. 178,681), seat of Muscogee co., W Ga., at the head of navigation on the Chattahoochee River; settled and inc. 1828 on the site of a Creek village. , OH; Third Street Promenade The Third Street Promenade is a pedestrian street in Santa Monica, California, United States. It is considered one of the premier shopping destinations in West Los Angeles and frequently draws crowds from all over Los Angeles County. , Santa Monica Santa Monica (săn`tə mŏn`ĭkə), city (1990 pop. 86,905), Los Angeles co., S Calif., on Santa Monica Bay; inc. 1886. Tourism and retailing are important, and the city has motion-picture, biotechnology, and software industries. , CA; and Briarwood Mall Briarwood Mall, is a shopping mall in Ann Arbor, Michigan, United States. The mall's four anchor stores are Macy's, JCPenney, Sears and Von Maur. Simon Property Group currently manages and co-owns the mall. History Originally developed by developer A. , Ann Arbor Ann Arbor, city (1990 pop. 109,592), seat of Washtenaw co., S Mich., on the Huron River; inc. 1851. It is a research and educational center, with a large number of government and industrial research and development firms, many in high-technology fields such as , MI). The Company also completed the purchase of a restaurant located in San Antonio, Texas “San Antonio” redirects here. For other uses, see San Antonio (disambiguation). San Antonio is the second most populous city in Texas, the third most populous metropolitan area in Texas, and is the seventh most populous city in the United States. As of the 2006 U.S. , which was formerly operated by a franchisee. "We are pleased with the results of our new restaurants which are averaging over $55,000 in sales per week," said Fred (Friendly Rollabout Engineered for Doctors) A mobile medical conferencing unit. See videoconferencing. 1. FRED - Robert Carr. Language used by Framework, Ashton-Tate. 2. Hipp HIPP Help Increase the Peace Program HIPP Hifn Intelligent Packet Processing (Hifn, Inc.) HIPP Highlands & Islands Partnership Programme HIPP High Impact Polypropylene HIPP Handbook of Institutional Pharmacy Practice , CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. and President. In addition to the company-owned restaurants opened during the quarter, the Company's franchisees opened two new full service restaurants during the quarter (Ventura, California Incorporated in 1866, the city of San Buenaventura (usually referred to as Ventura) is the county seat of Ventura County, California. Ventura has a population of 106,744.[1] Ventura is accessible via U.S. and Jakarta Jakarta or Djakarta (both: jəkär`tə, jäkär`tä), city and special district (1990 pop. 8,227,746), capital and largest city of Indonesia, NW Java, at the mouth of the canalized Ciliwung River, on Jakarta , Indonesia Indonesia (ĭn'dənē`zhə), officially Republic of Indonesia, republic (2005 est. pop. 241,974,000), c.735,000 sq mi (1,903,650 sq km), SE Asia, in the Malay Archipelago. ). Average weekly sales for the Company's full service restaurants increased to $55,029 in the second quarter of 2001 from $54,308 for the same quarter last year. "I am pleased with our ability to continually con·tin·u·al adj. 1. Recurring regularly or frequently: the continual need to pay the mortgage. 2. manage our costs despite a much more difficult operating environment In computing, an operating environment is the environment in which users run programs, whether in a command line interface, such as in MS-DOS or the Unix shell, or in a graphical user interface, such as in the Macintosh operating system. than in the past. We were able to maintain our restaurant level cash flow margins at 19.4%, which is consistent with the same quarter last year. Additionally, we were able to improve our operating margins Operating Margin A ratio used to measure a company's pricing strategy and operating efficiency. Calculated by: before pre-opening costs and non-recurring compensation by 40 basis points to 9.4% of revenues versus 9.0% last year," added Hipp. The Company plans to open a minimum of 8 additional full service restaurants prior to the end of the current fiscal year for a total of at least 14 new restaurants in 2001. All 8 of these restaurants are currently under construction and the Company expects 5 of them to open in the third quarter, with the remaining 3 to be completed during the fourth quarter. Comparable restaurant sales for the third quarter are expected to remain in the 2% to 4% range and fully 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 are expected to be in the range of $.20 to $.22. California Pizza Kitchen, Inc., founded in 1985, is a leading casual dining chain in the premium pizza pizza Food of Neapolitan origin. It consists of a flattened disk of bread dough, typically topped with olive oil, tomatoes, and mozzarella cheese, baked quickly, and served hot. Pizza is eaten throughout Italy, with regional variations in toppings. Pizza came to the U.S. segment. The Company's full service restaurants feature an imaginative line of innovative hearth-baked pizzas, including the original BBQ BBQ barbecue Chicken Pizza, and a broad selection of distinctive pastas, salads, soups, and sandwiches. The average guest check is approximately $10.85. The chain operates, licenses or franchises 120 restaurants of which 89 are company-owned and 31 operate under franchise or license agreements. The Company also has a strategic alliance with Kraft Pizza Company to manufacture and distribute a line of California Pizza Kitchen premium frozen pizzas. California Pizza Kitchen can be found on the World Wide Web at www.cpk.com. This press release includes certain "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 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. Investors are cautioned that forward-looking statements are not guarantees of future performance and, therefore, undue reliance should not be placed on them. Forward-looking statements can be affected by inaccurate assumptions or by known or unknown risks and uncertainties. Our actual results may differ materially from the expectations referred to herein. Among the key factors that may have a direct bearing on our operating results, performance and financial condition are the execution of our expansion strategy, the continued availability of qualified employees, the maintenance of reasonable food and supply costs and numerous other matters discussed in the Company's filings with the Securities and Exchange Commission. California Pizza Kitchen undertakes no obligation to update or alter its forward-looking statements whether as a result of new information, future events or otherwise.
Selected Consolidated Financial and Operating Data
(Dollars in thousands, except for per share and operating data)
Quarter Ended Six Months Ended
July 1, July 2, July 1, July 2,
2001 2000 2001 2000
Statement of Operations Data
Revenues
Restaurant sales $ 59,487 $ 51,974 $115,863 $ 99,685
Franchise and other revenues 842 665 1,493 1,220
Total revenues 60,329 52,639 117,356 100,905
Restaurant costs and expenses
Cost of sales 14,692 12,948 28,489 24,747
Labor 21,473 18,722 41,772 35,808
Direct operating and occupancy 11,798 10,218 23,055 19,800
Total restaurant operating
costs 47,963 41,888 93,316 80,355
General and administrative 3,826 3,671 7,495 7,221
Depreciation and amortization 2,873 2,333 5,613 4,621
Pre-opening 721 378 1,113 515
Loss on impairment of property
and equipment and store closures - - - 1,839
Non-recurring compensation charge - 1,949 - 1,949
Operating income 4,946 2,420 9,819 4,405
Other income (expense)
Interest income (expense) 170 (740) 386 (1,501)
Total other income (expense),
net 170 (740) 386 (1,501)
Income before income tax
provision 5,116 1,680 10,205 2,904
Income tax provision (1,791) (588) (3,572) (1,016)
Net income 3,325 1,092 6,633 1,888
Redeemable preferred stock
accretion - (1,472) - (2,930)
Net income (loss) attributable
to common shareholders $ 3,325 $ (380) $ 6,633 $ (1,042)
Net income (loss) per common share
Basic $ 0.18 $ (0.04) $ 0.36 $ (0.10)
Diluted $ 0.18 $ (0.03) $ 0.36 $ (0.09)
Shares used in computing net
income (loss) per common
share (in thousands)
Basic 18,291 10,897 18,215 10,897
Diluted 18,628 11,216 18,604 11,216
Pro Forma Data (1) (2)
Net income attributable to
common shareholders $ 3,325 $ 2,986 $ 6,633 $ 5,618
Net income per common share
Basic $ 0.18 $ 0.17 $ 0.36 $ 0.31
Diluted $ 0.18 $ 0.16 $ 0.36 $ 0.31
Shares used in computing net
income per common share
(in thousands)
Basic 18,291 17,876 18,215 17,876
Diluted 18,628 18,207 18,604 18,207
Operating Data
System-wide restaurants open
at end of period 120 104 120 104
Company-owned restaurants
open at end of period 89 74 89 74
Average weekly company-owned
full service restaurant
sales $ 55,029 $ 54,308 $ 54,522 $ 53,024
Comparable company-owned
restaurant sales increase 3.3% 7.4% 4.7% 7.1%
-0-
Quarter Ended Six Months Ended
July 1, July 2, July 1, July 2,
2001 2000 2001 2000
Statement of Operations Data (3)
Revenues
Restaurant sales 98.6% 98.7% 98.7% 98.8%
Franchise and other revenues 1.4 1.3 1.3 1.2
Total revenues 100.0 100.0 100.0 100.0
Restaurant costs and expenses
Cost of sales 24.7 24.9 24.6 24.8
Labor 36.1 36.0 36.1 35.9
Direct operating and occupancy 19.8 19.7 19.9 19.9
Total restaurant operating
costs 80.6 80.6 80.5 80.6
General and administrative 6.3 7.0 6.4 7.2
Depreciation and amortization 4.8 4.4 4.8 4.6
Pre-opening 1.2 0.7 0.9 0.5
Loss on impairment of property
and equipment and store closures - - - 1.8
Non-recurring compensation charge - 3.7 - 1.9
Operating income 8.2 4.6 8.4 4.4
Other income (expense)
Interest income (expense) 0.3 (1.4) 0.3 (1.5)
Total other income (expense),
net 0.3 (1.4) 0.3 (1.5)
Income before income tax provision 8.5 3.2 8.7 2.9
Income tax provision (3.0) (1.1) (3.0) (1.0)
Net income 5.5 2.1 5.7 1.9
Redeemable preferred stock
accretion - (2.8) - (2.9)
Net income (loss) attributable to
common shareholders 5.5% (0.7)% 5.7% (1.0)%
Selected Consolidated Balance Sheet Information
(Dollars in thousands)
Selected Consolidated Balance Sheet July 1, December 31,
Information 2001 2000
Cash and cash equivalents $ 13,361 $ 12,649
Total assets 128,053 116,977
Total debt, including current portion 25 47
Shareholders' equity 104,938 92,318
(1) Pro forma net income attributable to common shareholders for the
quarter ended July 2, 2000 is the result of the elimination of
$481,000 of interest expense, net of taxes, related to the
repayment of bank debt upon the closing of our initial public
offering, the elimination of compensation expense of $146,000, net
of taxes, due to the amendment of our co-founders' employment
agreements, the elimination of $1.3 million, net of taxes, related
to the non-recurring compensation charge for performance based
stock options and the elimination of $1.5 million in preferred
stock accretion upon the conversion of our preferred stock. Pro
forma net income attributable to common shareholders for the six
months ended July 2, 2000 is the result of the elimination of
$976,000 of interest expense, net of taxes, related to the
repayment of bank debt upon the closing of our initial public
offering, the elimination of compensation expense of $292,000, net
of taxes, due to the amendment of our co-founders' employment
agreements, the elimination of $1.2 million, net of taxes, related
to the write-down of one of our properties in accordance with FAS
121, the elimination of $1.3 million, net of taxes, related to the
non-recurring compensation charge for performance based stock
options and the elimination of $2.9 million in preferred stock
accretion upon the conversion of our preferred stock.
(2) Pro forma share information gives effect, as of the beginning of
each period, to the sale of 5,300,000 shares of common stock by us
in our initial public offering, the conversion of all outstanding
shares of our preferred stock into 1,580,938 shares of common
stock and our repurchase of 1,000 shares from our majority
shareholder, both pursuant to a plan of recapitalization, and the
issuance of 110,696 shares of our common stock upon the exercise
of options held by our Chief Executive Officer and President.
(3) Percentages are expressed as a percentage of total revenues,
except for restaurant costs and expenses, which are expressed as a
percentage of restaurant sales.
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