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Triarc Companies, Inc. reports fourth quarter and year-end results; Year-end charges mark end of evolutionary phase; Arby's and Royal Crown continue sales growth; National Propane files initial public offering.

NEW YORK--(BUSINESS WIRE)--March 29, 1996--Triarc Companies, Inc. (NYSE:TRY) announced today that it has substantially completed its evolutionary phase and is close to attaining many of its near-term strategic objectives. The Company further announced that, in line with its previously stated objectives, it has taken a series of year-end charges which are reflected in its 1995 fiscal year results.

Triarc previously announced that it will sell its Graniteville textile operation to Avondale Incorporated for $255 million in cash and expects to close this sale during the second quarter. In addition, Triarc announced earlier this week that its National Propane Corporation subsidiary has formed a master limited partnership (MLP) which has filed a registration statement with the Securities and Exchange Commission for an initial public offering. National Propane Corporation will be the general partner of the MLP and retain an approximate 48% interest in the partnership. The MLP is also expected to issue approximately $120 million of long-term senior secured debt. The partnership intends to use a substantial portion of the net proceeds of this offering to repay existing debt and to make certain payments and advances, aggregating approximately $110 million, to Triarc. The completion of these two transactions and the repayment of Graniteville's indebtedness will provide Triarc with cash in excess of $135 million and substantially reduce debt.

Operations at both National Propane and Graniteville were adversely affected by a series of cyclical and one time events in 1995. These included the second warmest (1994-1995) winter ever recorded, which had a negative effect on the propane business, and a combination of record high cotton prices and a cyclical downturn in the textile industry, which adversely impacted the results of Graniteville.

Year-End Charges

Triarc recorded $27 million of charges, primarily non-cash, in the fourth quarter. Included in these charges was $14.6 million ($8.9 million after tax or $.30 per share) for the early adoption of Statement of Financial Accounting Standards No. 121 ("Accounting for Impairment of Long-Lived Assets"). Also included was a charge of $7.8 million ($4.9 million after tax or $.16 per share) representing equity in losses and write-offs of investments and loans to affiliated companies. Adoption of SFAS No. 121 is required by the first quarter of 1996. The adoption of this standard, which requires the company to consider the potential impairment in the value of long-lived assets, will provide a non-cash benefit in future years from reduced depreciation and amortization.

The company further incurred $15 million of pretax losses with respect to the end of its evolutionary phase. The majority of these losses reflect severance and relocation costs and other related expenditures. These charges, coupled with a fourth quarter increase in the company's tax reserves of $7 million ($.24 per share) for various matters associated with the years 1989-1992, contributed to the loss from continuing operations of $38.9 million, or $1.30 per share, for the fourth quarter and a loss of $37.0 million, or $1.24 per share, for the 1995 fiscal year. This compares to a loss of $6.4 million, or $.33 per share, for last year's fourth quarter and a loss of $2.1 million, or $.34 per share, for fiscal 1994.

Operating Results

After reflecting a majority of the above mentioned charges, Triarc's reported earnings before interest, taxes, depreciation and amortization (EBITDA) of $104.6 million on revenues of $1.2 billion for the year ended December 31, 1995 compared with EBITDA of $113.9 million on revenues of $1.1 billion for the prior-year period. For the fourth quarter, after these charges, EBITDA of $16.1 million was achieved on revenues of $315.1 million compared with EBITDA of $26.3 million on revenues of $268.9 million for the 1994 fourth quarter.

Nelson Peltz, chairman and chief executive officer, said, "We have completed a very complicated year and, for the most part, the evolutionary phase of shaping our company is behind us. We are now about creating equity value in our consumer brands. We have a very promising beginning in 1996 and look forward to improved results for our restaurant and beverage businesses. Our new structure at National Propane should serve us well in the coming years."

Segment Results


Triarc's restaurant unit, Arby's, reported EBITDA of $3.0 million for the quarter and $24.1 million for the year on revenues of $74.4 million and $272.7 million, respectively. This compares with EBITDA of $5.1 million on revenues of $60.7 million for last year's fourth quarter and EBITDA of $27.0 million on revenues of $223.2 million for the 1994 year. Charges relating to the impairment write-down under SFAS No. 121 and other evolutionary events had a major adverse effect on the profitability of Arby's. Without these charges, the unit would have reported EBITDA for the year of $30.0 million or an approximate 11% increase over the prior year. Systemwide comparable store sales were up approximately 1% for the full year.

The 1995 revenue increase primarily reflects the addition of 85 new company-owned stores during the year bringing the total to 373 at December 31, many of which came into the system during the second half of 1995. Profit margins were adversely affected, however, by costs associated with replacing point-of-sale register systems in all domestic company-owned restaurants and start-up costs associated with the significantly higher number of new restaurant openings. The costs associated with the development of both the Roast Town and co-branding strategies and the additional personnel necessary to ensure the proper execution of these concepts, and to facilitate growth plans, also adversely affected earnings during the quarter and year. These costs, as a percentage of total administration costs, should diminish in future periods. Additionally, Arby's results in 1995 were adversely affected by a provision of $2.1 million for the closing of certain unprofitable restaurants.

Arby's has embarked on a program of upgrading many of its units to the Roast Town fast-casual concept and to co-branding its system with two concepts: P.T. Noodles, a pasta menu and ZuZu, a wholesome handmade Mexican food concept. This co-branding program will significantly add sales volume to Arby's, while their implementation will be significantly less than the cost of building new units. Arby's also previously announced that it has entered into an agreement in principle to purchase the T.J. Cinnamons brand, which specializes in gourmet cinnamon rolls and related products. It will begin offering T.J. Cinnamons products as a breakfast, dessert and snack line of products throughout its system in the near future.

"The 22% sales growth for Arby's is a direct result of new store openings, primarily in the second half, and increased store volumes experienced through the revitalization of our brand," said Peter May, president and chief operating officer of Triarc. Six new Roast Town restaurants, an upscale concept from Arby's that broadens the menu to include roasted meats, enticing side dishes and fresh baked bread, and creates a fast-casual dining experience, were added during the fourth quarter in the Toledo, Ohio, market. These units have been experiencing average unit volumes in excess of $1 million on an annualized basis. Two additional Roast Town restaurants were opened in Toledo during the first quarter of 1996. Four of these Toledo stores will be co-branded with the P.T. Noodles concept in May and one will also introduce the T.J. Cinnamons product line.


EBITDA for Royal Crown, Triarc's carbonated soft drink company, was a loss of $1.2 million for the quarter and a profit of $8.7 million for the year. Revenues were $36.2 million for the quarter and $172.6 million for the year. This compared with EBITDA and revenues of $3.9 million and $35.0 million, respectively, for the 1994 quarter and $21.0 million and $150.7 million, respectively, for the full year 1994. The 15% growth in revenues for the year, was primarily due to finished soft drink product sales of C&C, which trademark and distribution rights were acquired by Royal Crown in January, 1995, and the summer launch of Royal Crown Draft Premium Cola, together with some growth in branded concentrate sales. However, this growth was impeded by higher packaging costs experienced by our bottlers early in the year. Royal Crown's earnings were negatively impacted by lower volumes of private label concentrate sold to Cott Corporation and the costs associated with the introduction of Draft Cola. Royal Crown is the exclusive cola supplier to Cott.

Total branded concentrate volume for the full year increased 5% compared with the prior year, led by an increase of 25% in the international marketplace. The growth in the international segment is a result of Royal Crown's expansion in Brazil, Israel and the Baltics/Ukraine. This increase in branded volume came despite a significant volume shortfall in Los Angeles caused by the financial difficulties of the independent Royal Crown bottler in that market. Royal Crown had a strong fourth quarter for its Diet Rite flavors, a trend that has continued into 1996.

During the year, Kick, the company's "hardcore psycho nitro" citrus flavored soft drink, grew by a factor of almost three times to a volume of over six million cases as more and more of Royal Crown's bottlers introduced the brand.

Advertising and marketing expenses increased $8.0 million year over year to $86.2 million in 1995 from $78.2 million. Advertising for the launch of Royal Crown Draft Cola in the New York and Los Angeles markets, which did not translate into an adequate market return, accounted for the majority of this increase. For 1996, we remain optimistic as new launches for Royal Crown Draft Cola have reached an additional 50 new markets with a new marketing program geared to sampling and trial for gaining consumer acceptance.

For 1996 Royal Crown has redirected its marketing spending to enable it to directly support and encourage those bottlers that produce the best results. By focusing its marketing dollars on regional programs aimed at its most successful markets, Royal Crown hopes to increase its own profitability accordingly. At the same time, the company continues to work together with its independent bottlers to strengthen the overall system.


Triarc's premium beverage unit, Mistic, was acquired on August 9, 1995. EBITDA for Mistic was $1.5 million for the fourth quarter and $6.4 million since acquisition on revenues of $19.1 million and $41.9 million, respectively. Mistic has completely revitalized its product line and its marketing and distribution programs over the last portion of 1995 and into the beginning of 1996 and now has a whole new look. Among the new products is the new line of Tropical Coolers -- Pina Colada, Strawberry Colada, Peach Beach and Papaya Paradise. Also, a new line of Breeze products offered in a 20oz. PET container with a sports cap has been introduced.


EBITDA for National Propane, Triarc's liquefied petroleum distribution unit, was $25.2 million on revenues of $149.0 million for the 1995 fiscal year. For the comparable period last year, EBITDA was $28.8 million on revenues of $151.7 million.


EBITDA for Graniteville, Triarc's textile unit, was $4.2 million for the quarter and $39.7 million for the full year on revenues of $138.9 million for the quarter and $547.9 million for the year. For the comparable periods last year EBITDA was $12.3 million for the quarter and $48.5 million for the full year on revenues of $129.8 million for the quarter and $536.9 million for the year.

C.H. Patrick, Graniteville's specialty chemicals and dyes producer, continues to contribute significantly to the profitability of the company. C.H. Patrick will not be involved in the sale of Graniteville, and will remain a subsidiary of Triarc. As a part of the proposed sale of Graniteville referred to above, Avondale and C.H. Patrick will enter into a long-term agreement pursuant to which Patrick will supply dyes and chemicals to the combined Avondale/Graniteville business. With annual sales of more than $1 billion, Triarc Companies is engaged in four core businesses: restaurants (Arby's), beverages (Royal Crown Company and Mistic Brands), textiles (Graniteville and C.H. Patrick) and liquefied petroleum gas (National Propane).

CONTACT: Martin M. Shea

(212) 230-3030

 Triarc Companies, Inc.
 Condensed Consolidated Statements of Earnings
 Fourth Quarter and Year Ended December 31

 Fourth Quarter Year
 1994 1995 1994 1995
 (In thousands except per share amounts)

Revenues $ 268,890 $ 315,072 $ 1,062,521 $ 1,184,221

Earnings before
 interest, taxes,
 depreciation and
 amortization $ 26,348 $ 16,096 $ 113,870 $ 104,629
Depreciation and
 amortization of
 properties (8,710) (10,980) (33,902) (38,893)
Reduction in
 carrying value of
 long-lived assets -- (14,647) -- (14,647)
Amortization of
 intangibles (1,710) (3,992) (6,987) (11,329)
Amortization of stock
 compensation plan (880) (2,220) (4,048) (5,771)
Interest expense, net (17,639) (22,990) (68,316) (80,680)
Other, net (7,380) (4,500) (1,098) 8,667
 Loss before taxes (9,971) (43,233) (481) (38,024)
Benefit from
 (provision for)
 income taxes 3,563 4,286 (1,612) 1,030
 Loss from continuing
 operations (6,408) (38,947) (2,093) (36,994)
Discontinued operations (3,900) -- (3,900) --
Extraordinary charge (2,116) -- (2,116) --
 Net loss $ (12,424) $ (38,947) $ (8,109) $ (36,994)

Loss per share (a):
 Continuing operations $(.33) $(1.30) $(.34) $(1.24)
 Discontinued operations (.16) -- (.17) --
 Extraordinary charge (.09) -- (.09) --
 $(.58) $(1.30) $(.60) $(1.24)

Weighted average shares 24,040 29,909 23,282 29,764

(a) Loss per share for the three months and year ended December 31,
1994 reflect increases in the loss applicable to common stockholders
of $1.5 million and $5.8 million, respectively, for dividend
requirements on the Company's then existing redeemable preferred
stock. Such dividend requirements were not applicable to the 1995
periods presented above due to the conversion of the redeemable
preferred stock into common stock in January, 1995.


1. The managing underwriters for the MLP offering are Merrill Lynch
& Co. and Donaldson, Lufkin & Jenrette Securities Corporation. When
available, copies of the preliminary prospectus may be obtained from
Merrill Lynch & Co., 250 Vesey Street, New York, New York 10281. The
offering of the common units representing limited partner interests
in the MLP is expected to commence during the second quarter of 1996.

2. A registration statement with respect to the offering of the
MLP's common units has been filed with the Securities and Exchange
Commission, but has not yet become effective. The offering of the
MLP units will be made only by means of a prospectus. The MLP common
units may not be sold, nor may offers to buy be accepted prior to the
time the registration statement becomes effective. This press
release shall not constitute an offer to sell or the solicitation of
an offer to buy, nor shall there be any sale of the MLP common units
in any State in which such an offer, solicitation or sale would be
unlawful prior to registration or qualification under the securities
laws of any such State.

3. The senior secured debt to be issued by the partnership will not
be registered under the Securities Act of 1933 and may not be offered
or sold in the United States absent registration or an applicable
exemption from registration requirements.

4. The statements in this press release that are not historical
facts constitute "forward-looking statements" that involve risks,
uncertainties and other facts which may cause actual results to be
materially different from those set forth in the forward-looking
statements. Such factors include, but are not limited to, the
following: general economic and business conditions; competition;
success of operating initiatives; development and operating costs;
advertising and promotional efforts; brand awareness; the existence
or absence of adverse publicity; acceptance of new product offerings;
availability, locations and terms of sites for restaurant
development; changes in business strategy or development plans;
quality of management; availability, terms and deployment of capital;
business abilities and judgment of personnel; availability of
qualified personnel; labor and employee benefit costs; availability
and cost of raw materials and supplies; changes in, or failure to
comply with, government regulations; regional weather conditions;
fashion, apparel and other textile industry trends; import protection
and regulation; construction schedules; the costs and other effects
of legal and administrative proceedings and other factors referenced
in this press release. Triarc will not undertake and specifically
declines any obligation to publicly release the result of any
revisions which may be made to any forward-looking statements to
reflect events or circumstances after the date of such statements or
to reflect the occurrence of anticipated or unanticipated events.

CONTACT: Martin M. Shea

(212) 230-3030
COPYRIGHT 1996 Business Wire
No portion of this article can be reproduced without the express written permission from the copyright holder.
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Publication:Business Wire
Date:Mar 29, 1996
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