Dave & Buster's, Inc. Reports Second Quarter 2005 Results.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. -- 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, today announced results for its second quarter ended July July: see month. 31, 2005. In a preliminary release Dave & Buster's announced a change in its recently acquired Jillian's Jillian's is a restaurant and arcade chain with about 20 locations in the United States. Jillian's is currently owned and operated by JCB Entertainment Corporation, a subsidiary of Dave & Buster's. Its slogan is "Eat, Drink, Play". stores strategy. Now most of the Jillian's stores will be converted to the Dave & Buster's brand. Total revenue for the second quarter increased 23.4 percent, or $21.0 million, to $110.8 million from $89.8 million in the prior year's comparable quarter. Food and beverage F&B is a common abbreviation in the United States and Commonwealth countries, including Hong Kong. F&B is typically the widely accepted abbreviation for "Food and Beverage," which is the sector/industry that specializes in the conceptualization, the making of, and delivery of foods. revenue increased 28.4 percent and amusement Amusement is the state of experiencing humorous and usually entertaining events or situations, and is associated with enjoyment, happiness, laughter and pleasure. Amusement may also be experienced through the recollection of events which have given rise to amusement in the past. and other revenue increased 17.8 percent. Special event revenue on a comparable store basis was 13.5 percent of total revenue compared to 13.4 percent last year. Pre-opening expenses for the period were $0.8 million compared to $0.1 million last year. Operating loss operating loss The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. for the period of $(0.3) million includes a pre-tax pre-tax adj → anterior al impuesto pre-tax adj → avant impôt(s) pre-tax adj → al lordo d'imposta charge of $2.5 million for the previously announced closure of the underperforming Jillian's location in Minneapolis Minneapolis (mĭn'ēăp`əlĭs), city (1990 pop. 368,383), seat of Hennepin co., E Minn., at the head of navigation on the Mississippi River, at St. Anthony Falls; inc. 1856. . Excluding this charge, 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. decreased 51.5 percent to $2.2 million compared to $4.5 million last year. 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 decreased to $12.0 million, or 5.3 percent, from $12.7 million last year. Net loss for the quarter was $(1.3) million, or $(0.09) per basic share, compared to net income in the same period last year of $2.2 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. The estimated effect of the store closure charge is approximately $(0.12) per basic share. During the quarter, revenues from the 33 comparable stores, all of which operate under the Dave & Buster's brand, increased 0.2% as compared to the same period last year. The Dave & Buster's core brand accounts for approximately 85% of consolidated revenues. Total revenues for the 26-week period increased 22.6 percent to $226.6 million from $184.8 million for the comparable period last year. Food and beverage revenue increased 26.8 percent, and amusement and other revenue increased 18.1 percent. Special event revenue on a comparable store basis increased to 13.5 percent of total revenue from 13.1 percent in the prior year. Pre-opening expenses for the 26-week period were $0.9 million compared to $0.1 million last year. Operating income of $8.6 million includes the $2.5 million charge discussed above. Excluding this charge, operating income was $11.1 million compared to $11.4 million for the prior year. EBITDA increased to $30.7 million, or 10.3 percent, from $27.8 million last year. Net income was $3.3 million, or $0.24 per diluted share, compared to $5.8 million, or $0.40 per diluted share, in the prior year. "We expect our first converted store to re-open as a Dave & Buster's by early next month with three to four to follow prior to the end of the year," said 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. , the company's 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. . "We believe, as we discussed on our last conference call, that the re-branding of the Jillian's locations will enable us to improve the overall operating results at a faster pace," continued Mr. Corley. "Our new Dave & Buster's stores are on schedule to open in Buffalo, New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of on October October: see month. 5 and Kansas City Kansas City, two adjacent cities of the same name, one (1990 pop. 149,767), seat of Wyandotte co., NE Kansas (inc. 1859), the other (1990 pop. 435,146), Clay, Jackson, and Platte counties, NW Mo. (inc. 1850). in November November: see month. ," said Dave Corriveau, the company's President. "As we have previously announced, we add the Jillian's at Discover Mills Discover Mills is a 1.2 million square foot, single story shopping mall in Lawrenceville, Georgia with over 180 specialty retailers. The mall features 14 anchors as well as a variety of theme restaurants, casual dining and entertainment venues. Mall in metro Atlanta Atlanta (ətlăn`tə, ăt–), city (1990 pop. 394,017), state capital and seat of Fulton co., NW Ga., on the Chattahoochee R. and Peachtree Creek, near the Appalachian foothills; inc. 1847. later this month," continued Mr. Corriveau. The company re-confirms annual guidance of $.64 to $.70 per diluted share. This revised estimate Revised estimate The third estimate of GDP released about three months after the measurement period. includes the approximate $3.0 million pretax pre·tax adj. Existing before tax deductions: pretax income. pretax adj [profit] → vor (Abzug der) Steuern charge associated with the store closure in Minneapolis. Non-GAAP Financial Measures A reconciliation of EBITDA to net income, the most directly comparable financial measure presented 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 GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). , is set forth in the attachment to this release. The Company will hold a conference call to discuss second quarter results on Thursday Thursday: see week. , September September: see month. 8, 2005, at 11:30 a.m. Eastern Time (10:30 a.m. Central Time). The call will be Webcast by CCBN CCBN Central Coast Bancorp CCBN Charles County Business Network and can be accessed at Dave & Buster's Web site, www.daveandbusters.com. Individual investors can listen to the call through CCBN's individual investor center, www.companyboardroom.com. In addition, investors can access the call by visiting any of the investor sites in the CCBN Individual Investor Network. Institutional investors Institutional Investor A non-bank person or organization that trades securities in large enough share quantities or dollar amounts that they qualify for preferential treatment and lower commissions. can access the call via CCBN's password-protected event management site, www.streetevents.com. The Webcast will be archived on the company's Web site and available for replay through September 23, 2005. Celebrating over 22 years of operations, Dave & Buster's was founded in 1982 and is one of the country's leading upscale, restaurant/entertainment concepts with 43 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. and in 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 . More information on the company, including the latest investor presentation is available on the company's Website, www.daveandbusters.com. "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. " Statements Under 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 Certain information contained in this press release includes 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. . 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 for·ward-look·ing adj. Concerned with or making provision for the future: forward-looking educators; a forward-looking corporate plan. Adj. 1. 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 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 relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc 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.
DAVE & BUSTER'S, INC.
Condensed Consolidated Balance Sheets
(in thousands)
(unaudited)
July 31, 2005 January 30, 2005
ASSETS
Current assets:
Cash and cash equivalents $ 6,786 $ 7,624
Other current assets 43,942 34,581
------------ -------------
Total current assets 50,728 42,205
Property and equipment, net 335,074 331,478
Other assets and deferred charges 21,045 23,725
------------ -------------
Total assets $ 406,847 $ 397,408
============ =============
LIABILITIES AND STOCKHOLDERS' EQUITY
Total current liabilities $ 56,376 $ 49,861
Other long-term liabilities 73,176 70,251
Long-term debt 74,823 80,351
Stockholders' equity:
Common stock 136 135
Paid-in capital 124,190 122,173
Restricted stock awards 1,815 1,454
Accumulated other comprehensive
income 67 225
Retained earnings 78,110 74,804
------------ -------------
204,318 198,791
Less: treasury stock 1,846 1,846
------------ -------------
Total stockholders' equity 202,472 196,945
------------ -------------
Total liabilities and stockholders'
equity $ 406,847 $ 397,408
============ =============
DAVE & BUSTER'S, INC.
Consolidated Statements of Income
(dollars in thousands, except per share amounts)
(unaudited)
13 Weeks Ended 13 Weeks Ended
July 31, 2005 August 1, 2004
(as restated)
Food and beverage revenues $ 60,378 54.5% $47,030 52.3%
Amusement and other revenues 50,451 45.5% 42,814 47.7%
-------- ------- ------- ------
Total revenues 110,829 100.0% 89,844 100.0%
Cost of products 21,196 19.1% 17,283 19.2%
Operating payroll and benefits 32,259 29.1% 25,545 28.4%
Other store operating expenses 37,365 33.7% 28,401 31.6%
General and administrative expenses 7,204 6.5% 5,800 6.5%
Depreciation and amortization 12,317 11.1% 8,175 9.1%
Preopening costs 804 0.8% 136 0.2%
-------- ------- ------- ------
Total operating expenses 111,145 100.3% 85,340 95.0%
Operating income (loss) (316) (0.3)% 4,504 5.0%
Interest expense, net 1,661 1.5% 1,102 1.2%
-------- ------- ------- ------
Income (loss) before provision
for income taxes (1,977) (1.8)% 3,402 3.8%
Provision (benefit) for income taxes (721) (0.7)% 1,200 1.3%
-------- ------- ------- ------
Net income (loss) $ (1,256) (1.1)% $ 2,202 2.5%
======== ======= ======= ======
Net income (loss) per share
Basic $ (0.09) $ 0.17
Diluted $ (0.09) $ 0.16
Weighted average shares outstanding
Basic weighted average shares
outstanding 13,559 13,319
Diluted weighted average shares
outstanding 13,559 16,486
Other information:
Company operated stores open 44 33
EBITDA, which is earnings before interest, taxes, depreciation
and amortization, is used by management, bankers and investors
to evaluate a company's ability to repay debt and for
compliance of certain debt covenants.
Total net income (loss) $ (1,256) $ 2,202
Add back: depreciation and
amortization 12,317 8,175
interest expense, net 1,661 1,102
provision for income taxes (721) 1,200
--------- -------
$ 12,001 $12,679
========= =======
DAVE & BUSTER'S, INC.
Consolidated Statements of Income
(dollars in thousands, except per share amounts)
(unaudited)
26 Weeks Ended 26 Weeks Ended
July 31, 2005 August 1, 2004
(as restated)
Food and beverage revenues $121,769 53.7% $ 96,051 52.0%
Amusement and other revenues 104,795 46.3% 88,759 48.0%
-------- ------- --------- -------
Total revenues 226,564 100.0% 184,810 100.0%
Cost of products 42,203 18.6% 35,004 18.9%
Operating payroll and benefits 64,984 28.7% 52,473 28.4%
Other store operating expenses 72,900 32.2% 57,269 31.0%
General and administrative expenses 14,896 6.6% 12,099 6.5%
Depreciation and amortization 22,058 9.7% 16,395 8.9%
Preopening costs 882 0.4% 136 0.1%
-------- ------- --------- -------
Total operating expenses 217,923 96.2% 173,376 93.8%
Operating income 8,641 3.8% 11,434 6.2%
Interest expense, net 3,434 1.5% 2,580 1.4%
-------- ------- --------- -------
Income before provision for
income taxes 5,207 2.3% 8,854 4.8%
Provision for income taxes 1,901 0.8% 3,052 1.7%
-------- ------- --------- -------
Net income $ 3,306 1.5% $ 5,802 3.1%
======== ======= ========= =======
Net income per share
Basic $ 0.25 $ 0.44
Diluted $ 0.24 $ 0.40
Weighted average shares outstanding
Basic weighted average shares
outstanding 13,515 13,262
Diluted weighted average
shares outstanding 16,626 16,376
Other information:
Company operated stores open 44 33
EBITDA, which is earnings before interest, taxes, depreciation
and amortization, is used by management, bankers and investors
to evaluate a company's ability to repay debt and for compliance
of certain debt covenants.
Total net income $ 3,306 $ 5,802
Add back: depreciation
and amortization 22,058 16,395
interest expense, net 3,434 2,580
provision for income
taxes 1,901 3,052
-------- ---------
$ 30,699 $ 27,829
======== =========
DAVE & BUSTER'S, INC.
Consolidates Statements of Cash Flow
(dollars in thousands)
(unaudited)
26 Weeks Ended 26 Weeks Ended
July 31, 2005 August 1, 2004
(as restated)
Cash flows from operating activities:
Income $ 3,306 $ 5,802
Adjustments to reconcile income
to net cash provided by operating
activities:
Depreciation and amortization 22,058 16,395
Deferred income tax benefit 81 (2,024)
Tax benefit related to stock
option exercises 619 493
Amortization of restricted
stock awards 361 219
Warrants related to
convertible debt 128 128
Other, net (227) (48)
Changes in operating assets
and liabilities
Inventories (43) (167)
Prepaid expenses (9,399) (1,582)
Other current assets 81 871
Other assets and deferred
charges 3,158 (1,066)
Accounts payable 5,823 507
Accrued liabilities 677 929
Income taxes payable (4,527) (2,007)
Deferred rent liability 815 (962)
Other liabilities 2,037 1,002
------------- --------------
Net cash provided by
operating activities 24,948 18,490
Cash flows from investing activities:
Capital expenditures (22,556) (16,580)
Proceeds from sales of property
and equipment 111 390
------------- --------------
Net cash used in investing
activities (22,445) (16,190)
------------- --------------
Cash flows from financing activities:
Borrowings under long-term debt 6,500 3,250
Repayments of long-term debt (11,240) (6,417)
Proceeds from exercises of stock
options 1,399 2,007
------------- --------------
Net cash provided by (used in)
financing activities (3,341) (1,160)
------------- --------------
Increase (decrease) in cash and cash
equivalents (838) 1,140
Beginning cash and cash equivalents 7,624 3,897
------------- --------------
Ending cash and cash equivalents $ 6,786 $ 5,037
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