Dave & Buster's, Inc. Reports Fourth Quarter and Fiscal 2002 Results.Business Editors DALLAS--(BUSINESS WIRE)--April 8, 2003 Dave & Buster's, Inc. (NYSE NYSE See: New York Stock Exchange :DAB (Digital Audio Broadcasting) The digital radio standard in most countries except for the U.S., which uses iBiquity's HD Radio, and Japan, which uses Terrestrial Integrated Services Digital Broadcasting (ISDB-T). ), a leading operator of upscale restaurant/entertainment complexes, announced its results for the fourth quarter and for the fiscal year ended February February: see month. 2, 2003. Total revenues for the fiscal fourth quarter were $99.8 million, a 4.8 percent decrease compared to the $104.8 million in the same quarter of the prior fiscal year. Comparable store sales decreased 4.8 percent compared to the fourth quarter of the prior year. Both total revenues and comparable store sales continued to be adversely affected during the quarter by the challenging economic environment impacting the restaurant and entertainment industries. Operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. for the quarter was $6.7 million compared to $9.1 million in the same quarter of the prior year, a decrease of 26 percent. Net income for the quarter was $3.2 million, or $0.24 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 to $4.7 million, or $0.36 per diluted share in prior year fourth quarter. For the fiscal year ended February 2, 2003, total revenues were $373.8 million, a 4.4 percent increase over the $358.0 million for fiscal 2001. 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 declined 3.2 percent for the year. Operating income for the year was $15.2 million compared to $19.7 million in the prior fiscal year, a decrease of 22.6 percent. Operating income was affected by a one-time one-time adj. 1. or one·time a. Occurring or undertaken only once: a one-time winner in 1995. b. charge of $1.3 million, or $0.06 per diluted share, relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc the Company's proposed merger that was terminated ter·mi·nate v. ter·mi·nat·ed, ter·mi·nat·ing, ter·mi·nates v.tr. 1. To bring to an end or halt: on October October: see month. 24, 2002. Prior to the cumulative effect of a change in an accounting principle, income for the year was $5.3 million, or $0.40 per diluted share compared to $7.6 million, or $0.58 per diluted share in the prior year. The Company applied the new standards of accounting for goodwill and other intangible assets Intangible Asset An asset that is not physical in nature. Notes: Examples are things like copyrights, patents, intellectual property, and goodwill. These are the opposite of tangible assets. during the first quarter of fiscal 2002, which resulted in a one-time charge of $7.1 million, or ($0.53) per diluted share. The cumulative effect of this change in accounting principle resulted in a net loss for the year of ($1.7 million), or ($0.13) per diluted share. The Company amended a·mend v. a·mend·ed, a·mend·ing, a·mends v.tr. 1. To change for the better; improve: amended the earlier proposal so as to make it more comprehensive. 2. its credit agreement effective as of February 2, 2003, to be in compliance with the required EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become covenant covenant (kŭv`ənənt), agreement entered into voluntarily by two or more parties to do or refrain from doing certain acts. In the Bible and in theology the covenant is the agreement or engagement of God with man as revealed in the . EBITDA is generally used by bankers and investors to evaluate a company's ability to repay debt. In addition, the fixed charge covenant was amended for the remainder of the term of the agreement to give the Company more flexibility with regard to capital expenditures. The Company expects to be in compliance with the credit agreement covenants going forward. "We generated more than $45 million of EBITDA for the year, enabling us to accomplish one of our major objectives, which was the significant reduction of our long-term debt Long-Term Debt Loans and financial obligations lasting over one year. Notes: For example debts obligations such as bonds and notes which have maturities greater than one year would be considered long-term debt. ," commented W. C. Hammett Ham·mett , Dashiell 1894-1961. American writer of highly acclaimed detective fiction, including The Maltese Falcon (1930) and The Thin Man (1932). Noun 1. , CFO See Chief Financial Officer. of Dave & Buster's. "Debt was reduced by $23 million this year, $17 million of which took place in the fourth quarter as we focused aggressively on this goal." "Weak economic conditions and lack of consumer confidence have continued to affect our top line," stated Buster Corley Corley (or Corley Ash) is a village and civil parish in the North Warwickshire district of Warwickshire, England. It is located about five miles north west of Coventry and is adjacent to Fillongley. , co-founder of Dave & Buster's. "We have taken definitive steps as a result of this business climate, including suspending our new store expansion, contracting our organization and undergoing a comprehensive analysis of our operations in order to increase our efficiency and cut our costs. We believe that these actions will help D&B's team manage the business in adverse conditions. We will continue to make efficiency and productivity two of our priorities in fiscal 2003." "Even with the careful business management that Buster outlined, we have remained committed to providing a high level of guest experience," stated Dave Corriveau, co-founder. "Our goal is to achieve the optimum results from our 32 company-operated stores, while keeping Dave & Buster's a destination of choice for food and fun. To this end, we have undertaken a complete analysis of each of our facilities, including our Midway Midway, island group (2 sq mi/5.2 sq km), central Pacific, c.1,150 mi (1,850 km) NW of Honolulu, comprising Sand and Eastern islands with the surrounding atoll. Discovered by Americans in 1859, Midway was annexed in 1867. A cable station was opened in 1903. layout and game offerings. The enhancements we have planned during 2003 are designed to raise our guest experience to a new level." The Company confirmed its previously announced fiscal year 2003 earnings per share guidance of $0.77 to $0.85. However, because of the continued uncertain economic conditions, including the current war with Iraq Iraq or Irak (both: ēräk`, ĭrăk`), officially Republic of Iraq, republic (2005 est. pop. 26,075,000), 167,924 sq mi (434,924 sq km), SW Asia. , the Company has, at this time, withdrawn any specific guidance for the individual 2003 quarterly results. For 2003, there will be two stores added to the comparable store base, bringing the total number of comparable stores to 28. The Company will hold a conference call with management to discuss its results. The call will be held on Tuesday Tuesday: see week. , April 8, at 4:15 p.m. local Dallas Dallas, city (1990 pop. 1,006,877), seat of Dallas co., N Tex., on the Trinity River near the junction of its three forks; inc. 1871. The second largest Texas city, after Houston, and the eighth largest U.S. time. Interested parties may listen to the conference call over the Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the through Dave & Buster's Web site, www.daveandbusters.com. To listen to the live call, please access the Web site at least fifteen minutes early to register, download To receive a file transmitted over a network. In any communications session, "download" means receive, and "upload" means send. The download/upload often implies a big/little scenario, in which data is being downloaded from the "big" server into the "little" user's computer. , and install any necessary audio software. For those who cannot listen to the live broadcast, a replay will be available shortly after the call on the Web site. The archived call will be available for two weeks. Celebrating over 20 years of operations, Dave & Buster's was founded in 1982 and is one of the country's leading upscale, restaurant/entertainment concepts, with 32 Dave & Buster's locations throughout 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. . Additionally, Dave & Buster's has international agreements for the Pacific Rim Pacific Rim, term used to describe the nations bordering the Pacific Ocean and the island countries situated in it. In the post–World War II era, the Pacific Rim has become an increasingly important and interconnected economic region. , Canada Canada (kăn`ədə), independent nation (2001 pop. 30,007,094), 3,851,787 sq mi (9,976,128 sq km), N North America. Canada occupies all of North America N of the United States (and E of Alaska) except for Greenland and the French islands of , the Middle East and Mexico Mexico, city, Mexico Mexico or Mexico City, Span. Ciudad de México (Méjico), city (1990 pop. 8,236,960; 1991 met. area est. 20,899,000), central Mexico, capital and largest city of Mexico. . 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. Certain information contained in this press release includes forward-looking statements. Forward-looking statements include statements regarding our expectations, beliefs, intentions, plans, projections, objectives, goals, strategies, future events or performance and underlying assumptions and other statements which are other than statements of historical facts. These statements may be identified, without limitations, by the use of forward looking terminology such as "may," "will," "anticipates," "expects," "projects," "believes," "intends," "should," or comparable terms or the negative thereof. All forward-looking statements included in this press release are based on information available to us on the date hereof here·of adv. Of this. hereof Adverb Formal or law of or concerning this Adv. 1. hereof - of or concerning this; "the twigs hereof are physic" . Such statements speak only as of the date hereof. These statements involve risks and uncertainties that could cause actual results to differ materially from those described in the statements. These risks and uncertainties include, but are not limited to, the following: our ability to open new high-volume restaurant/entertainment complexes; our ability to raise and access sufficient capital in the future; changes in consumer preferences, general economic conditions or consumer discretionary spending; the outbreak or continuation of war or other hostilities hos·til·i·ty n. pl. hos·til·i·ties 1. The state of being hostile; antagonism or enmity. See Synonyms at enmity. 2. a. A hostile act. b. hostilities Acts of war; overt warfare. involving the United States; potential fluctuation Fluctuation A price or interest rate change. in our quarterly operating result due to seasonality and other factors; the continued service of key management personnel; our ability to attract, motivate and retain qualified personnel; the impact of federal, state or local government regulations relating to our personnel or the sale of food or alcoholic beverages
When a person begins a civil lawsuit, the person enters into a process called litigation. ; the effect of competition in our industry; additional costs associated with compliance with the Sarbanes-Oxley Act See SOX. and related regulations and requirements; and other risk factors described from time to time in our reports filed with the SEC. (tables follow)
DAVE & BUSTER'S, INC.
Condensed Consolidated Balance Sheets
(in thousands)
(unaudited)
February 2, February 3,
2003 2002
------------ ------------
ASSETS
Current assets
Cash and cash equivalents $2,530 $4,521
Other current assets 30,819 29,851
------------ ------------
Total current assets 33,349 34,372
Property and equipment, net 249,451 265,398
Other assets 8,412 9,364
------------ ------------
$291,212 $309,134
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Total current liabilities $37,580 $38,850
Other long-term liabilities 24,536 15,242
Long-term debt 59,494 84,896
Stockholders' equity
Common Stock 132 131
Paid in capital 116,678 115,701
Restricted stock awards 608 382
Retained earnings 54,030 55,778
------------ ------------
171,448 171,992
Less: Treasury stock 1,846 1,846
------------ ------------
Total stockholders' equity 169,602 170,146
------------ ------------
$291,212 $309,134
============ ============
DAVE & BUSTER'S, INC.
Consolidated Statements of Income
(dollars in thousands, except per share amounts)
(unaudited)
13 Weeks Ended 13 Weeks Ended
February 2, February 3,
2003 2002
--------------- ---------------
Food and beverage revenues $54,033 54.1% $55,033 52.5%
Amusement and other revenues 45,777 45.9% 49,773 47.5%
-------- --------
Total revenues 99,810 100.0% 104,806 100.0%
Cost of sales 18,338 18.4% 19,435 18.5%
Operating payroll and benefits 28,731 28.8% 31,271 29.8%
Other store operating expenses 32,292 32.4% 31,554 30.1%
General and administrative 5,976 6.0% 5,279 5.0%
Depreciation and amortization 7,536 7.6% 7,378 7.0%
Preopening costs 230 0.2% 828 0.8%
-------- --------
Total operating expenses 93,103 93.3% 95,745 91.4%
Operating income 6,707 6.7% 9,061 8.6%
Interest expense, net 1,887 1.9% 1,757 1.7%
-------- --------
Income before provision for income
taxes 4,820 4.8% 7,304 7.0%
Provision for income taxes 1,639 1.6% 2,644 2.5%
-------- --------
Net income $3,181 3.2% $4,660 4.4%
======== ========
Net income per share:
Basic $0.24 $0.36
Diluted $0.24 $0.36
Weighted average shares outstanding:
Basic 13,029 12,957
Diluted 13,219 12,992
Other information:
Company operated stores open 32 31
EBITDA (Earnings before interest,
taxes, depreciation and amortization:
Total operating income $6,707 $9,061
Add back depreciation and
amortization 7,536 7,378
-------- --------
EBITDA $14,243 $16,439
DAVE & BUSTER'S, INC.
Consolidated Statements of Income
(dollars in thousands, except per share amounts)
(unaudited)
52 Weeks Ended 52 Weeks Ended
February 2, 2003 February 3, 2002
---------------- ----------------
Food and beverage revenues $192,882 51.6% $181,358 50.7%
Amusement and other revenues 180,870 48.4% 176,651 49.3%
--------- ---------
Total revenues $373,752 100.0% 358,009 100.0%
Cost of sales 68,752 18.4% 66,939 18.7%
Operating payroll and benefits 114,904 30.7% 110,478 30.9%
Other store operating expenses 117,666 31.5% 106,971 29.9%
General and administrative 25,640 6.9% 20,653 5.8%
Depreciation and amortization 30,056 8.0% 28,693 8.0%
Preopening costs 1,488 0.4% 4,578 1.3%
--------- ---------
Total costs and expenses 358,506 95.9% 338,312 94.5%
Operating income 15,246 4.1% 19,697 5.5%
Interest expense, net 7,143 1.9% 7,820 2.2%
--------- ---------
Income before provision for income
taxes and cumulative effect of a
change in an accounting principle 8,103 2.2% 11,877 3.3%
Provision for income taxes 2,755 0.7% 4,299 1.2%
--------- ---------
Income before cumulative effect of a
change in an accounting principle $5,348 1.4% $7,578 2.1%
Cumulative effective of a change in
an accounting principle (7,096) 1.9% - -
--------- ---------
Net income (loss) $(1,748) (0.5)% $7,578 2.1%
========= =========
Net income (loss) per share - basic
before cumulative effect of a
change in an accounting principle $0.41 $0.58
Cumulative effect of a change in an
accounting principle (0.55) -
--------- ---------
$(0.14) $0.58
Net income (loss) per share -
diluted before cumulative effect of
a change in an accounting principle $0.40 $0.58
Cumulative effect of a change in an
accounting principle (0.53) -
--------- ---------
$(0.13) $0.58
Basic weighted average shares
outstanding 12,997 12,956
Diluted weighted average shares
outstanding 13,404 13,016
EBITDA (Earnings before interest,
taxes, depreciation and
amortization):
Operating Income $15,246 $19,697
Add back depreciation and
amortization 30,056 28,693
--------- ---------
EBITDA $45,302 $48,390
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