DenAmerica Reports Second Quarter and Six-Month Results.SCOTTSDALE, Ariz.--(BUSINESS WIRE)--August 20, 1998-- 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 Rise at Black-eyed Pea and Denny's DenAmerica Corp. (AMEX AMEX See: American Stock Exchange :DEN (Directory Enabled Networks) The management of a network from a central depository of information about users, applications and network resources. Originally an initiative from Microsoft and Cisco, DEN was turned over to the DMTF in 1998, and its extensions were made ), the owner and franchisor of the Black-eyed Pea (BEP BEP Black Eyed Peas (band) BEP Brevet d’Études Professionnelles (French: vocational qualification) BEP Business Entry Point BEP Break-Even Point BEP Bit Error Probability BEP Bureau of Engraving & Printing ) restaurant chain and a leading franchisee of Denny's restaurants, today announced financial results for the 13-week and 26-week periods ended July 1, 1998. The corresponding year-earlier periods are the 13- week and 26-week periods ended July 2, 1997. For the 13-week period ended July 1, 1998, restaurant sales were $62.1 million, compared to restaurant sales of $76.2 million in the 1997 13-week period. The decrease was primarily due to the Company's sale of 71 restaurants (63 Denny's and 8 unbranded) on March 25, 1998. DenAmerica reported a net loss of approximately $1.1 million for the period, or $0.08 per share, versus a net loss of $350,000, or $0.03 per share in the 1997 period. Per share results for the 1998 and 1997 13-week periods are based on 13,447,000 and 13,414,000 weighted average shares outstanding, respectively. Black-eyed Pea same store sales increased 2.0% during the 13-week period in the core Texas/Oklahoma market, and rose 0.2% overall. Same store Denny's sales increased 3.5% during the period. For the 26-week period ended July 1, 1998, the Company had restaurant sales of $134.9 million, compared to $152.3 million for the year-earlier 26-week period. The decline was primarily due to the March 1998 sale of 71 restaurants. For the first half of 1998, DenAmerica reported net income (after the extraordinary gain associated with early debt extinguishment The destruction or cancellation of a right, a power, a contract, or an estate. Extinguishment is sometimes confused with merger, though there is a clear distinction between them. ) of approximately $278,000, or $0.02 per share, compared to a net loss of $939,000, or $0.07 per share in the year-ago period. Per share results for the 1998 and 1997 26-week period are based on 13,447,000 and 13,414,000 weighted average shares outstanding, respectively. On July 10, 1998, the Company and Tech Electro E`lec´tro n. 1. An electrotype. Industries, Inc. (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on :TELE) ("TELE") executed a definitive merger agreement. Under the terms of the definitive agreement, DenAmerica shareholders will receive $4.00 in cash and $0.90 of newly-issued TELE preferred stock Stock shares that have preferential rights to dividends or to amounts distributable on liquidation, or to both, ahead of common shareholders. Preferred stock is given preference over common stock. Holders of preferred stock receive dividends at a fixed annual rate. . The consummation CONSUMMATION. The completion of a thing; as the consummation of marriage; (q.v.) the consummation of a contract, and the like. 2. A contract is said to be consummated, when everything to be done in relation to it, has been accomplished. of this transaction is contingent upon Adj. 1. contingent upon - determined by conditions or circumstances that follow; "arms sales contingent on the approval of congress" contingent on, dependant on, dependant upon, dependent on, dependent upon, depending on, contingent various matters including the completion of due diligence Research; analysis; your homework. This term has caught on in all industries, because it sounds so "wired." Who would want to do analysis or research when they can do due diligence. See wired. , satisfaction of financing contingencies Contingencies (ISSN 1048-9851) is the bimonthly magazine of the American Academy of Actuaries, providing a large and diverse readership with general interest and technical articles on a wide range of issues related to the actuarial profession. and securing the necessary fairness opinions Fairness Opinion A report put together by qualified analysts or advisors providing to key decision makers an evaluation of and facts about a merger or acquisition. Notes: A fairness opinion serves as a document used for guidance in a merger, takeover, or acquisition. . DenAmerica Chairman and Chief Executive Officer Jack M. Lloyd commented, "The Company continues to focus on satisfying its conditions necessary to completing the TELE merger. We believe the completion of this merger transaction will satisfy our overall objective of delivering value to our shareholders. "Although the second quarter results were disappointing given the same store sales increases in both concepts, the Company does not believe that the operating results will adversely impact the pricing contingencies included in the definitive merger agreement. Over the past several quarters, the Company has completed its strategic objectives of lessening its dependency on the Denny's brand and continuing the growth of the BEP concept. Recently, DenAmerica purchased two of its remaining three franchised BEP restaurants and we plan to begin construction of three BEPs located in our core market over the next several months. "We believe that sales improvements at the Company's remaining Denny's restaurants, which have for the first time in several years achieved same store sales increases, combined with the strength of the BEP brand, position DenAmerica for long-term growth." DenAmerica Corp. operates full-service, family-oriented and casual dining restaurants, based primarily on the Denny's brand and DenAmerica's own Black-eyed Pea restaurant concept. Company restaurants are located in 31 states, with the largest concentration in the Southeast, Midwest and West regions. Except for the historical information in this press release, 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. that involve risks and uncertainties, including, but not limited to, competitive pressures from within the restaurant industry, changes in the prices of food and beverages 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. , quarterly fluctuations in results, the management of growth and other risks detailed from time to time in the Company's Securities and Exchange Commission filings. Actual results may differ materially from management expectations. -0-
DENAMERICA CORP. AND SUBSIDIARIES
Condensed Consolidated Statements of Operations
(In thousands, except per share data)
(Unaudited)
13-Week Period Ended 26-Week Period Ended
7/1/98 7/2/97 7/1/98 7/2/97
Restaurant sales $ 62,066 $ 76,185 $134,946 $152,299
Restaurant operating
expenses:
Food and beverage cost 17,100 20,840 37,107 41,453
Payroll and payroll
related costs 20,950 26,260 46,052 52,361
Depreciation and
amortization 1,943 2,324 3,730 4,590
Other operating
expenses 17,469 20,350 37,058 41,518
Total operating
expenses 57,462 69,774 123,947 139,922
Restaurant operating
income 4,604 6,411 10,999 12,377
Administrative expenses 3,030 3,831 6,048 7,575
Operating income 1,574 2,580 4,951 4,802
Interest expense, net 3,122 3,164 6,548 6,367
Loss before income taxes
and extraordinary item (1,548) (584) (1,597) (1,565)
Income tax (benefit) (487) (234) (504) (626)
Loss before extraordinary
item (1,061) (350) (1,093) (939)
Extraordinary item - gain
on early extinguishment
of debt net of income
taxes of $914 -- -- 1,371 --
Net income (loss) (1,061) (350) 278 (939)
Basic and diluted income
(loss) per share
Before extraordinary
item $ (0.08) $ (0.03) $ (0.08) $ (0.07)
Net income (loss) $ (0.08) $ (0.03) $ 0.02 $ (0.07)
Basic and diluted
weighted average
shares outstanding
Basic 13,447 13,414 13,447 13,414
Diluted 13,447 13,414 13,447 13,414
CONTACT: Todd S Todd , Sir Alexander Robertus 1907-1997. British chemist. He won a 1957 Nobel Prize for his study of nucleic acids and nucleotide structures. . Brown Chief Financial Officer DenAmerica Corp. 602/483-7055 or Robert L. Rinderman Joseph N. Jaffoni Jaffoni & Collins Incorporated 212/835-8500 or rinderman@jcir.com |
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