Carrols Restaurant Group, Inc. and Carrols Corporation Report Financial Results for the Fourth Quarter & Full Year 2007.SYRACUSE Syracuse, city, Italy Syracuse (sĭr`əky  s, –kyz), Ital. Siracusa, city (1991 pop. , N.Y. -- Carrols Carrols is the name for several fast food restaurant chains including:
TAST Threaded Algebraic Space-Time TAST Tima Asynchronous Synthesis Tools ), the parent company of Carrols Corporation Carrols is a company that owns fast-food restaurants in the north east and southern United States. It is one of the largest operators of Burger King franchises. They also own the restaurant chains Pollo Tropical and Taco Cabana. , today announced financial results for the fourth quarter and full year ended December December: see month. 30, 2007. Highlights for the fourth quarter of 2007 versus the fourth quarter of 2006 include: * Total revenues increased 4.5% to $197.2 million from $188.7 million, including a 5.6% increase for the Company's Hispanic Hispanic Multiculture A person of Mexican, Puerto Rican, Cuban, Central or South American, or other Spanish culture or origin, regardless of race Social medicine Any of 17 major Latino subcultures, concentrated in California, Texas, Chicago, Miam, NY, and elsewhere Brands; * Comparable restaurant sales increased 4.6% at Burger King[R], 2.0% at Pollo Tropical Pollo Tropical (lit. Tropical Chicken in Spanish) is a Miami-based fast food restaurant chain specializing in Caribbean food. Pollo Tropical is owned and operated by Carrols Corporation. The first Pollo Tropical opened in November 1988, in Miami. [R], and 0.9% at Taco Cabana[R]; * Income from operations was $13.4 million (including higher expenses related to being a public company and stock-based compensation) compared to $15.1 million; * Net income was $3.5 million, or $0.16 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, which compared to net income of $3.7 million, or $0.22 per diluted share, (including a non-recurring gain of $0.9 million after-tax af·ter-tax also af·ter·tax adj. Relating to or being that which remains after payment, especially of income taxes: after-tax profits. or $0.06 per diluted share in 2006). Net income for the fourth quarter of 2006 would have been $0.17 per diluted share after giving pro forma As a matter of form or for the sake of form. Used to describe accounting, financial, and other statements or conclusions based upon assumed or anticipated facts. The phrase pro forma effect for the additional shares issued in the Company's initial public offering completed on December 20, 2006 (including the non-recurring gain of $0.04 on a pro forma basis). Highlights for the full year 2007 versus the full year 2006 include: * Total revenues increased 5.1% to $789.4 million from $751.4 million, including a 6.6% increase for the Company's Hispanic Brands; * Comparable restaurant sales increased 4.6% at Burger King, 1.4% at Pollo Tropical, and 0.2% at Taco Cabana; * Income from operations was $55.4 million compared to $64.2 million; * Net income was $15.1 million, or $0.70 per share (including non-recurring losses of $1.7 million after-tax, or $0.09 per share), compared to $13.4 million, or $0.83 per share, (including non-recurring gains of $1.9 million after-tax or $0.12 per share). Net income would have been $0.62 per share in 2006 after giving pro forma effect for the additional shares issued in the Company's initial public offering (including the non-recurring gains of $0.09 per share on a pro forma basis). As of December 30, 2007, the Company owned and operated a total of 553 restaurants, including 322 Burger King, 84 Pollo Tropical and 147 Taco Cabana restaurants. Alan Vituli, Chairman and Chief Executive Officer of Carrols Restaurant Group, Inc. commented, "The fourth quarter was a challenging period for our industry, with many operators facing the 'perfect storm' of weaker consumer sentiment combined with higher commodity and labor costs. In view of these circumstances CIRCUMSTANCES, evidence. The particulars which accompany a fact. 2. The facts proved are either possible or impossible, ordinary and probable, or extraordinary and improbable, recent or ancient; they may have happened near us, or afar off; they are public or , we were relatively pleased to have achieved positive comparable sales results at all three of our restaurant concepts against strong prior year results. While, cost increases resulted in lower restaurant level margins in 2007, we nonetheless were able to realize solid earnings growth, which enabled us to modestly exceed our previous guidance. Overall, we are satisfied with what we accomplished this past year, and the strategic position of our business in these less certain times. We continue to be cautious, though, in our growth plans and opportunistic opportunistic /op·por·tu·nis·tic/ (op?er-tldbomacn-is´tik) 1. denoting a microorganism which does not ordinarily cause disease but becomes pathogenic under certain circumstances. 2. in pursuing new restaurant sites." Fourth Quarter 2007 Results Total revenues for the fourth quarter of 2007 increased 4.5% to $197.2 million from $188.7 million in the fourth quarter of 2006. During the fourth quarter of 2007, the Company opened two Pollo Tropical restaurants, one in Woodbridge, NJ and one in Orlando, FL, and opened one Taco Cabana restaurant in McAllen, TX. The Company also closed three Burger King restaurants, one Taco Cabana restaurant, and one Pollo Tropical restaurant. Revenues from the Company's Hispanic Brands increased 5.6% to $100.6 million in the fourth quarter of 2007 from $95.2 million in the same period last year. Pollo Tropical revenues increased 7.2% to $41.7 million during the fourth quarter of 2007 compared to $38.9 million in the fourth quarter of 2006. This was due primarily to the opening of 13 new Pollo Tropical restaurants since the beginning of the same period in 2006. Comparable restaurant sales at Pollo Tropical increased 2.0% in the fourth quarter of 2007. Taco Cabana revenues increased 4.6% to $58.9 million during the fourth quarter of 2007 compared to $56.3 million in the fourth quarter of 2006. This was due primarily to the opening of 10 new Taco Cabana restaurants since the beginning of the same period in 2006. Comparable restaurant sales at Taco Cabana increased 0.9% in the fourth quarter of 2007. Burger King revenues increased 3.4% to $96.7 million during the fourth quarter of 2007 compared to $93.5 million in the fourth quarter of 2006, despite the closing of six Burger King restaurants since the beginning of the same period in 2006. Comparable restaurant sales at Burger King increased 4.6% in the fourth quarter of 2007. General and administrative expenses were $13.9 million in the fourth quarter of 2007, or 7.0% of total revenues, compared to $13.6 million, or 7.2% of total revenues, in the fourth quarter of 2006. Income from operations was $13.4 million in the fourth quarter of 2007, or 6.8% of total revenues, compared to $15.1 million, or 8.0% of total revenues, in the fourth quarter of 2006. Interest expense decreased $1.9 million to $7.8 million in the fourth quarter of 2007 from $9.6 million in the same period in the prior year, primarily reflecting lower average debt balances from the prepayment Prepayment 1. The payment of a debt obligation prior to its due date. 2. The excess payment over a scheduled debt repayment amount. Notes: 1. Examples include deferred expenses such as rent and early loan repayments. 2. of $68.0 million in term loan borrowings with the IPO (Initial Public Offering) The first time a company offers shares of stock to the public. While not a computer term per se, many founders, employees and insiders of computer companies have found this acronym more exciting than any tech term they ever heard. proceeds received by the Company in December 2006. In addition, the Company completed the refinancing Refinancing An extension and/or increase in amount of existing debt. of its senior credit facility in March 2007 which lowered the interest rate on its senior secured borrowings by approximately 1%. The Company's income tax rate, including the effect of any discrete items, was 37.6% in the fourth quarter of 2007 compared to 32.0% in the fourth quarter of 2006. For the full year 2007, the Company's income tax rate was 33.2%, in line with guidance. Net income for the fourth quarter of 2007 was $3.5 million, or $0.16 per diluted share (based upon 21.6 million weighted average diluted shares). This compared to net income for the fourth quarter of 2006 of $3.7 million, or $0.22 per share (based upon 16.9 million weighted average diluted shares) which included a non-recurring gain of $0.9 million after-tax, or $0.06 per share. Net income for the fourth quarter of 2006 would have been $0.17 per share after giving pro forma effect for the additional shares issued in the Company's initial public offering completed in the fourth quarter of 2006 (based upon 21.6 million average diluted shares). Fourth quarter 2006 results also included a non-recurring after-tax gain of $0.9 million, or $0.04 per pro forma share, related to the sale of a Pollo Tropical leasehold An estate, interest, in real property held under a rental agreement by which the owner gives another the right to occupy or use land for a period of time. leasehold n. interest. Full Year 2007 Results Total revenues for 2007 increased 5.1% to $789.4 million from $751.4 million in the prior year. The Company opened nine Pollo Tropical restaurants and eight Taco Cabana restaurants during 2007. In addition, the Company closed six Burger King restaurants, four Taco Cabana restaurants and one Pollo Tropical restaurant. Comparable restaurant sales in 2007 increased 4.6% at Burger King, 1.4% at Pollo Tropical, and 0.2% at Taco Cabana. Income from operations was $55.4 million in 2007 compared to $64.2 million in 2006. 2007 results included $2.2 million in 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. losses, including a $1.7 million non-recurring write-down Write-Down Reducing the book value of an asset because it is overvalued compared to the market value. Notes: This is usually reflected in the company's income statement as an expense, thereby reducing net income. for an underperforming restaurant closed in the fourth quarter, and $1.1 million of gains from the sale of three restaurant properties. Income from operations in 2006 included $1.0 million in impairment losses and $2.8 million in non-recurring gains. Net income for 2007 was $15.1 million, or $0.70 per diluted share, including non-recurring losses of $1.7 million after-tax, or $0.09 per share consisting of the write-down related to the closed restaurant and a non-recurring charge related to the refinancing of the Company's senior credit facility. Net income for the year ended December 31, 2006 was $13.4 million, or $0.83 per diluted share (based upon 16.2 million weighted average diluted shares). These results included the 2006 non-recurring gains ($1.9 million after-tax or $0.12 per diluted share). Net income would have been $0.62 per diluted share in 2006 after giving pro forma effect for the additional shares issued in the Company's initial public offering completed in December 2006 (based upon 21.6 million average diluted shares). Net income in 2006 included non-recurring after-tax gains of $0.09 per share on a pro forma basis. Pro Forma Pro forma calculations provide investors with an alternative measure to evaluate the Company's performance and provide meaningful supplemental information of the Company's operating results on a basis comparable with that of future periods. The pro forma calculations reflect the post IPO capital structure as if it had been in place for the full periods presented. Pro forma information is not, and should not be, considered a substitute for financial information prepared in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with generally accepted accounting principles The standard accounting rules, regulations, and procedures used by companies in maintaining their financial records. Generally accepted accounting principles (GAAP) provide companies and accountants with a consistent set of guidelines that cover both broad accounting . Outlook For the full year 2008, the Company is providing the following guidance: * A total revenue increase of approximately 5% to 6% including comparable restaurant sales increases of 1%-2% for Pollo Tropical, 1.5%-2.5% for Taco Cabana and 2.5%-3.5% for its Burger King restaurants; * Total new unit openings of 17-23 Hispanic Brand restaurants, including 6 to 10 Pollo Tropical restaurants and 11 to 13 Taco Cabana restaurants. The Company is also likely to close one Taco Cabana restaurant, and have a net closure of four to five Burger King restaurants, which are net of the opening of seven to eight new Burger King locations, five or six of which will be relocations of existing units. * Capital expenditures of between $70 million and $80 million, including $35 million to $45 million for new restaurants (before any sale-leasebacks), $15 million to $18 million for remodeling remodeling /re·mod·el·ing/ (re-mod´el-ing) reorganization or renovation of an old structure. bone remodeling and $6 million to $8 million for new point of sales systems; * An estimated annual effective tax rate of between 37.5% and 38.5%; * 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 ranging from $0.70 to $0.75. Diluted common shares outstanding are estimated to be approximately 21.6 million. Mr. Vituli concluded, "Our outlook for 2008 reflects limited visibility in this turbulent environment. Diminishing di·min·ish v. di·min·ished, di·min·ish·ing, di·min·ish·es v.tr. 1. a. To make smaller or less or to cause to appear so. b. consumer discretionary spending, existing weakness in the Florida economy and spiraling increases in operating costs operating costs npl → gastos mpl operacionales have clouded the predictability of 2008 results. While we remain confident with 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. prospects for our Hispanic Brands, given the current economic climate, we have moderated our short-term Short-term Any investments with a maturity of one year or less. short-term 1. Of or relating to a gain or loss on the value of an asset that has been held less than a specified period of time. growth plans. Our Burger King business continues to be a reliable source of stability and free cash flow, and we are pleased with the sustained growth and vitality vi·tal·i·ty n. 1. The capacity to live, grow, or develop. 2. Physical or intellectual vigor; energy. of this brand. As experienced operators, we know that business cycles tend to have a dynamic effect on restaurant companies, and believe that we are well equipped to navigate (1) "Surfing the Web." To move from page to page on the Web. (2) To move through the menu structure in a software application. through the current cycle." Conference Call Today The Company will host a conference call to discuss fourth quarter 2007 financial results today at 8:30 a.m. Eastern Time. The conference call can be accessed live over the phone by dialing (800) 218-4007 or for international callers by dialing (303) 262-2138. A replay will be available one hour after the call and can be accessed by dialing (800) 405-2236 or for international callers by dialing (303) 590-3000; the passcode is 11109632. The replay will be available until Saturday, March 15, 2008. The call will be webcast live from the Company's website at www.carrols.com under the investor relations Investor relations The process by which the corporation communicates with its investors. section. About the Company Carrols Restaurant Group, Inc., operating through its subsidiaries, including Carrols Corporation, is one of the largest restaurant companies in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. . The Company operates three restaurant brands in the quick-casual and quick-service restaurant segments with 553 company-owned and operated restaurants in 16 states as of December 30, 2007, and 30 franchised restaurants in the United States, Puerto Rico Puerto Rico (pwār`tō rē`kō), island (2005 est. pop. 3,917,000), 3,508 sq mi (9,086 sq km), West Indies, c.1,000 mi (1,610 km) SE of Miami, Fla. and Ecuador. Carrols Restaurant Group owns and operates two Hispanic Brand restaurants, Pollo Tropical and Taco Cabana. It is also the largest Burger King franchisee, based on number of restaurants, and has operated Burger King restaurants since 1976. 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. Except for the historical information contained in this news release, the matters addressed are forward-looking statements. Forward-looking statements, written, oral or otherwise made, represent the Company's expectation or belief concerning future events. Without limiting the foregoing, these statements are often identified by the words "may," "might," "believes," "thinks," "anticipates," "plans," "expects" or similar expressions. In addition, expressions of our strategies, intentions or plans are also forward-looking statements. Such statements reflect management's current views with respect to future events and are subject to risks and uncertainties, both known and unknown. You are cautioned not to place undue reliance on these forward-looking statements as there are important factors that could cause actual results to differ materially from those in forward-looking statements, many of which are beyond our control. Investors are referred to the full discussion of risks and uncertainties as included in the Company's and Carrols Corporation's filings with the Securities and Exchange Commission. [TABLE OMITTED] [TABLE OMITTED] [TABLE OMITTED] [TABLE OMITTED] The following table reconciles diluted weighted average common shares outstanding as reported under generally accepted accounting principles to the number of shares after giving pro forma effect for additional shares issued in the Company's initial public offering completed on December 20, 2006 (in thousands): [TABLE OMITTED] |
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