Chick-fil-A Celebrates 35th Consecutive Year of Sales Gains In 2002; Positive Sales Performance Encourages Long-Term Expansion In New Markets.

Business Editors

ATLANTA--(BUSINESS WIRE)--Jan. 23, 2003

While much of corporate America is scrambling to recover from a sluggish economy, Atlanta-based restaurant chain Chick-fil-A, Inc. today reported 2002 system-wide sales of $1,372,800,518, a 10.54 percent increase over the company's 2001 sales, and a positive 1.52 percent same-store sales increase.

As the third-largest quick-service chicken restaurant company in the nation, Chick-fil-A sustains its unprecedented 35-year streak of consecutive sales growth with its 2002 performance of $1.37 billion.

"Posting sales gains every year since we opened the first Chick-fil-A restaurant in 1967 is first owed to our system of dedicated restaurant Operators and their focus on excellent customer service, coupled with our prudent expansion strategy," said Dan Cathy, president and chief operating officer of Chick-fil-A. "Our Chick-fil-A franchisees' commitment to continuous improvement in our customer service performance as well as their record of attracting and retaining loyal employees is a recipe for success at any time, and we feel their commitment will position us well for stronger economic times."

What To Expect In 2003

Enjoying its positive sales trend and financial stability, the 1,080-plus restaurant chain, which has stores in 36 states, is continuing its prudent expansion strategy by seeking new market opportunities beyond the Sunbelt region, where it currently has the strongest concentration of restaurants.

In addition to Chick-fil-A's record-setting sales performance in the slower economy of 2002, the chain also surpassed new location projections of 77 with a total of 80 openings last year. Building on this momentum, Chick-fil-A anticipates a 10-percent increase of new free-standing locations, now its core restaurant concept, in 2003. Of the 80 new locations opened in 2002, 54 were free-standing restaurants. From the 77 locations set to open this year, 60 will be free-standers, two will be mall locations, and 15 will be licensed restaurants at colleges, airports and hospitals.

While Chick-fil-A will continue to open restaurants throughout its core Southeastern and Southwestern markets, the chain also will strengthen its presence in the Northeastern states of Maryland, New Jersey, and Pennsylvania, and will open free-standing restaurants in markets where it presently has only mall stores, including southern California, Phoenix, Arizona, and Salt Lake City, Utah, where their first free-standing outlet opened this month. The first free-standing restaurants in Orange County, California and the Phoenix markets are expected to open during the third quarter of this year.

As Chick-fil-A penetrates current and new markets, the chain's immensely popular "Eat Mor Chikin(R)" Cow campaign will continue to be the cornerstone of its brand-building strategy. Since the campaign debuted in 1995 as a three-dimensional billboard concept, Chick-fil-A has enjoyed an 81 percent increase in its unaided brand awareness, and its sales have grown nearly 120 percent over the period.

In addition to its new-market expansion strategy, Chick-fil-A also will be making special enhancements to it menu this year. Building on its good nutritional profile, Chick-fil-A will add new and improved salad and Cool Wrap(R) menu offerings. "Historically, the Chick-fil-A brand has been built on our 'good taste' position with customers, yet we have a tremendous story to tell regarding the nutritional strength and appeal of our products," said Woody Faulk, vice president of brand development. "You'll see more menu development and communications with our customers about the strength and acceptance of our nutritional rating this coming year."

Chick-fil-A serves nutritious food products in malls, free-standing units, drive-thru-only outlets, Chick-fil-A Dwarf House(R) and Truett's Grill(R) full-service restaurants, and through licensed outlets in college campuses, hospitals, airports, businesses and industrial sites. As reported in the October 2002 edition of QSR magazine, Chick-fil-A was recognized as having the "Best Drive-Thru in America" following a quick-service restaurant study conducted by g3 Mystery Shopping (formerly Sparagowski & Associates). Additional information about Chick-fil-A is available on the chain's Web site, located at www.chick-fil-a.com.