Champps Entertainment, Inc. Reports Fiscal 2002 Second Quarter Results.Business Editors ENGLEWOOD Englewood (ĕng`gəlw  d).1 City (1990 pop. 29,387), Arapahoe co., N central Colo., on the South Platte River, a residential and industrial suburb of Denver; inc. 1903. , Colo.--(BUSINESS WIRE)--Jan. 22, 2002 Champps Entertainment, Inc. (Nasdaq:CMPP CMPP Centre Médico-Psycho-Pédagogique ) today announced results for the second quarter and first six months of fiscal 2002 ended December December: see month. 30, 2001. Total revenues for the second quarter increased 19.1 percent to $40,565,000 versus $34,064,000 in the second quarter of last year. Restaurant operating contribution rose 17.6 percent to $5,176,000 versus $4,401,000 for the second quarter last year. Net income for the quarter was $973,000 or $0.08 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 compared with $2,197,000 or $0.18 per diluted share for the same period last year. Pre-opening expenses were $1,029,000 for the second quarter of fiscal 2002 or $0.08 per diluted share compared with $7,000 or nil per diluted share last year. During the second quarter, in connection with its periodic assessment of various contingences, the Company recorded additional accruals Accruals Accounts on a balance sheet that represent liabilities and non-cash-based assets used in accrual-based accounting. These accounts include, among many others, accounts payable, accounts receivable, goodwill, future tax liability and future interest expense. totaling $436,000 or $0.03 per diluted share relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc businesses that have been disposed dis·pose v. dis·posed, dis·pos·ing, dis·pos·es v.tr. 1. To place or set in a particular order; arrange. 2. of or otherwise discontinued dis·con·tin·ue v. dis·con·tin·ued, dis·con·tin·u·ing, dis·con·tin·ues v.tr. 1. To stop doing or providing (something); end or abandon: prior to fiscal year ended June June: see month. 27, 1999. Comparable 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 0.1 percent for the second quarter versus a 1.1 percent increase reported in the same period last year. Total revenue for the six months ended December 30, 2001, reached $75,390,000 versus $67,147,000 in the first half of the prior fiscal year. Net income for the first half of fiscal 2002 was $1,449,000 or $0.11 per diluted share compared with $3,895,000 or $0.32 per diluted share for the same period last year. Pre-opening expenses were $1,716,000 or $0.14 per diluted share versus $250,000 or $0.02 per diluted share last year. The increase in pre-opening expenses was a result of the successful openings of four new Champps restaurants this quarter versus none in the same period last year. The newly opened restaurants are in Arlington Arlington, county, United States Arlington, county (1990 pop. 170,936), N Va., across the Potomac River from Washington, D.C. Arlington is a residential and commercial suburb of Washington. , Va.; Utica Utica, ancient city, N Africa Utica (y  `tĭkə), ancient N African city, c.25 mi (40 km) NW of Carthage. According to tradition, it was founded by Phoenicians from Tyre c. , Mich.; Columbia Columbia, cities, United StatesColumbia (kəlŭm`bēə). 1 City (1990 pop. 75,883), Howard co., central Md., between Washington, D.C., and Baltimore. , Md.; and Indianapolis Indianapolis (ĭn'dēənă`pəlĭs), city (1990 pop. 731,327), state capital and seat of Marion co., central Ind., on the White River; selected 1820 as the site of the state capital (which was moved there in 1825), inc. 1847. , Ind IND Investigational new drug Therapeutics A status assigned by the FDA to a drug before allowing its use in humans, exempting it from premarketing approval requirements so that experimental clinical trials may be conducted. See Phase 1.2, 3 studies, Sponsorship. . The Company also intends to open a new Champps restaurant in Raleigh/Durham, N.C., in March 2002 and Littleton Littleton, city (1990 pop. 33,685), seat of Arapahoe co., N central Colo.; platted 1812, inc. 1890. It is a suburb south of Denver in an irrigated farm area. , Colo., in May 2002. Additionally, the Company intends to open eight to ten new restaurants during fiscal 2003. General and administrative expenses were $2,197,000 and $4,119,000 for the second quarter and six months, respectively, versus $1,801,000 for the second quarter last year and $3,560,000 for the six months last year. William William, crown prince of Germany William or Frederick William, 1882–1951, crown prince of Germany, son of William II. In World War I he commanded (1914) an army on the Western Front and was nominal commander in the German attack H. Baumhauer, Champps' chairman, president and chief executive officer, commented: "We are pleased to report strong operating results for our second quarter. Revenues exceeded $40,000,000 and our restaurant operating margin Operating Margin A ratio used to measure a company's pricing strategy and operating efficiency. Calculated by: was 12.4 percent of sales. Despite a continuing soft economy, we are realizing positive sales trends and increased profit momentum. We expect to see these trends continue throughout fiscal 2002." Englewood, Colo.-based Champps Entertainment, Inc. currently owns and operates 32 and franchises 13 Champps Americana restaurants in 18 states. Champps, which competes in the upscale casual-dining segment, offers an extensive menu consisting of freshly prepared food, coupled with exceptional service. Champps presents an exciting environment through the use of videos, music, sports, promotions and programming. Champps Entertainment management will host a conference call on January 23, 2002, 10:00 a.m. EST EST electroshock therapy. EST abbr. electroshock therapy , to discuss second quarter fiscal 2002 results. To hear the call in a listen-only mode, participants must dial 800/521-5469 and refer to reservation no. 1450240, five minutes prior to the start of the call, or visit the company's web site at www.champps.com and click on the investor relations Investor relations The process by which the corporation communicates with its investors. icon to hear a live web simulcast and replay of the call. Statements made in this press release include 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. made pursuant to 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. Such statements involve certain risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. Information on significant potential risks and uncertainties that may cause such differences include, but are not limited to, those mentioned by the Company from time to time in its filings with the Securities and Exchange Commission. The words "believe," "estimate," "expect," "intend," "anticipate," "should" and similar expressions and variations thereof identify certain of such forward-looking statements, which speak only as of the dates on which they were made. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. Readers are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and, therefore, readers should not place undue reliance on these forward-looking statements.
CHAMPPS ENTERTAINMENT, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars in thousands, except per-share data)
Three Months Ended Six Months Ended
December 30, December 31, December 30, December 31,
2001 2000 2001 2000
Revenues:
Sales $ 40,413 $ 33,910 $ 75,083 $ 66,820
Franchising and
royalty, net 152 154 307 327
-------- -------- -------- --------
Total revenues 40,565 34,064 75,390 67,147
-------- -------- -------- --------
Costs and expenses:
Restaurant operating
expenses:
Product costs 11,352 9,876 21,351 19,397
Labor costs 12,953 10,541 24,301 21,174
Other operating
expenses 6,108 5,140 11,670 9,942
Occupancy 3,380 2,729 6,241 5,366
Depreciation and
amortization 1,596 1,377 3,085 2,765
-------- -------- -------- --------
Total restaurant
operating
expenses 35,389 29,663 66,648 58,644
Restaurant operating
and franchise
contribution 5,176 4,401 8,742 8,503
Preopening 1,029 7 1,716 250
General and
administrative
expenses 2,197 1,801 4,119 3,560
Expenses related to
predecessor
companies 283 - 283 -
-------- -------- -------- --------
Income from
operations 1,667 2,593 2,624 4,693
Interest expense, net 488 306 929 618
-------- -------- -------- --------
Income from
continuing
operations 1,179 2,287 1,695 4,075
Loss from discontinued
operations, net of
tax 153 - 153 -
-------- -------- -------- --------
Net income (loss)
before taxes 1,026 2,287 1,542 4,075
Provision for income
taxes 53 90 93 180
-------- -------- -------- --------
Net income (loss)
after taxes $ 973 $ 2,197 $ 1,449 $ 3,895
======== ======== ======== ========
Basic income per share:
Income before
discontinued
operations $ 0.09 $ 0.19 $ 0.13 $ 0.33
Loss from
discontinued
operations (0.01) - (0.01) -
-------- -------- -------- --------
Net income $ 0.08 $ 0.19 $ 0.12 $ 0.33
======== ======== ======== ========
Diluted income per share:
Income before
discontinued
operations $ 0.09 $ 0.18 $ 0.12 $ 0.32
Loss from
discontinued
operations (0.01) - (0.01) -
-------- -------- -------- --------
Net income $ 0.08 $ 0.18 $ 0.11 $ 0.32
======== ======== ======== ========
Basic weighted
average shares
outstanding 12,071 11,875 12,060 11,778
Diluted weighted
average shares
outstanding 12,667 12,373 12,698 12,169
Supplemental Information -- Operating Expenses
(Stated as a percentage of sales)
Product costs 28.1% 29.1% 28.4% 29.0%
Labor costs 32.1% 31.1% 32.4% 31.7%
Other operating
costs 15.1% 15.2% 15.6% 14.9%
Occupancy 8.4% 8.0% 8.3% 8.0%
Depreciation and
amortization 3.9% 4.1% 4.1% 4.1%
-------- -------- -------- --------
Total restaurant
operating
contribution 12.4% 12.5% 11.2% 12.3%
General and
administrative
expenses (Stated
as a percentage
of revenues) 5.4% 5.3% 5.5% 5.3%
-------- -------- -------- --------
Selected Consolidated Balance Sheet Information
December 30, July 1,
2001 2001
Cash and marketable
securities $ 3,539 $ 1,261
Total assets 88,682 79,458
Debt 17,906 15,062
Capital lease
obligations 3,220 2,031
Stockholders'
equity 46,620 44,616
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