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CARL KARCHER ENTERPRISES REPORTS SECOND QUARTER RESULTS

 ANAHEIM, Calif., Sept. 8 /PRNewswire/ -- Carl Karcher Enterprises Inc. (NASDAQ: CARL) today reported net income of $2.1 million, or $.12 per share, for the second quarter ended Aug. 9, 1993. This compares with $3.2 million, or $.18 per share, for the same period last year.
 Net income for the prior-year period included $4.4 million of other income, which consisted primarily of interest and investment income from the company's notes receivable and investment portfolio, respectively. The investment portfolio has since been significantly reduced, with proceeds largely utilized to reduce debt. The most recent quarter included $966,000 of other income and a non-recurring $533,000 charge related to the recent downsizing of regional operations.
 Revenues for the second quarter amounted to $108.2 million, compared with $119.9 million in the same period last year. The lower sales volume for the current quarter was due to a decline of approximately 9 percent in same-store sales, reflecting the continuing difficult economic and competitive climate in California, and the loss of revenues resulting from the elimination of sales of manufactured products to other outside parties.
 For the first half of the current fiscal year, net income amounted to $3.1 million, or $.17 per share, on revenues of $248.1 million. For the comparable prior-year period, net income was $4.0 million, or $.22 per share, on revenues of $281.5 million. Results for the previous year's period were restated to incorporate a $2.4 million charge, or $.14 per share, which reflects a change in accounting for income taxes to comply with Statement of Financial Accounting Standards No. 109. It also included a $1.4 million non-recurring charge related to the elimination of the company's manufacturing operations.
 Donald E. Doyle, president and chief executive officer, noted that pretax profit for the second quarter, excluding the effect of other income and restructuring charges, improved 59 percent, or $736,000, over the same period a year ago.
 "We are very encouraged by the early results of our strategic plan to improve the company's performance, both in terms of reducing operating costs and enhancing customer counts and overall sales," said Doyle. "On the expense side, labor costs as a percentage of sales are currently running 2 percent below a year ago, with other significant reductions being realized in repair and maintenance costs. Workers' compensation costs are declining due to a significant decrease in the rate of accidents. General and administrative costs are also declining as a result of the company's cost reduction program."
 Doyle continued, "The most important element of the strategic plan is to improve restaurant sales. While same-store sales performance continues to be a concern, we are seeing improved trends in customer counts. One test program in particular, which incorporates several aspects of our value pricing program, has resulted in a dramatic increase in customer counts and a strong sales improvement. Plans to expand this program to other markets, as well as further testing of additional marketing programs, are underway.
 "We still face many challenges," added Doyle. "However, after developing the turnaround strategies through the first half of our fiscal year, the pace of improvement is accelerating. And with the continued dedication and hard work of our employees and franchisees, I am confident that the programs we are putting into place will restore the health, vitality and increased profitability of our company."
 Carl Karcher Enterprises Inc. operates Carl's Jr. restaurants, a regional quick-service chain known for its varied menu and healthful, premium quality products. Founded in 1941, the company, its franchisees and licensees operate more than 640 restaurants in California, Nevada, Oregon, Arizona, Utah, China, Japan, Malaysia and Mexico.
 CARL KARCHER ENTERPRISES INC.
 Statement of Operations
 (In thousands except per share data)
 (Unaudited)
 12 Weeks Ended 28 Weeks Ended
 Aug. 9, Aug. 10, Aug. 9, Aug. 10,
 1993 1992 1993 1992
 $ Pct $ Pct. $ Pct. $ Pct.
 Revenues:
 Sales by company-
 operated res-
 taurants $89,202 82.5 $97,474 81.3 $205,233 82.7 $232,517 82.6
 Revenues from
 franchised and
 licensed res-
 taurants 18,975 17.5 18,613 15.5 42,859 17.3 40,186 14.3
 Revenues from
 other outside
 parties 0 0.0 3,844 3.2 0 0.0 8,834 3.1
 Total 108,177 100.0 119,931 100.0 248,092 100.0 281,537 100.0
 Operating
 costs and
 expenses:
 Company-operated
 restaurants:
 Food and
 packaging 27,798 25.7 29,443 24.5 63,349 25.5 71,055 25.2
 Payroll and
 other
 employee
 benefits 26,888 24.9 31,272 26.1 65,628 26.4 76,621 27.2
 Occupancy
 and other
 operating
 expenses 19,416 17.9 21,052 17.6 46,298 18.7 50,573 18.0
 Total 74,102 68.5 81,767 68.2 175,275 70.6 198,249 70.4
 Franchised and
 licensed res-
 taurants 16,927 15.7 16,844 14.0 38,686 15.6 36,021 12.8
 Other outside
 parties 0 0.0 3,700 3.1 0 0.0 8,595 3.1
 Advertising
 expenses 4,752 4.4 4,625 3.9 10,313 4.2 10,561 3.7
 General and
 administrative
 expenses 7,837 7.2 8,454 7.0 17,847 7.2 19,350 6.9
 Restructuring
 charges 533 0.5 1,400 1.2 533 0.2 1,400 0.5
 Total 104,151 96.3 116,790 97.4 242,654 97.8 274,176 97.4
 Operating
 income 4,026 3.7 3,141 2.6 5,438 2.2 7,361 2.6
 Interest
 expense (2,576) (2.4) (3,294) (2.7) (5,548) (2.3) (7,857)(2.8)
 Other income,
 net 966 0.9 4,365 3.6 3,959 1.6 9,488 3.4
 Income before
 income taxes
 and cumulative
 effect of
 change in
 accounting
 principle 2,416 2.2 4,212 3.5 3,849 1.5 8,992 3.2
 Income tax
 expense 272 0.2 984 0.8 779 0.3 2,538 0.9
 Income before
 cumulative
 effect of
 change in
 accounting
 principle 2,144 2.0 3,228 2.7 3,070 1.2 6,454 2.3
 Cumulative
 effect of
 change in
 accounting
 principle --- --- --- --- --- --- 2,450 0.9
 Net income $2,144 2.0 $3,228 2.7 $3,070 1.2 $4,004 1.4
 Net income
 per common
 share:
 Income before
 cumulative
 effect of
 change in
 accounting
 principle $0.12 $0.18 $0.17 $0.36
 Cumulative
 effect of
 change in
 accounting
 principle --- --- --- ($0.14)
 Total $0.12 $0.18 $0.17 $0.22
 Weighted
 average
 shares 18,157 18,017 18,120 17,991
 -0- 9/8/93
 /CONTACT: Loren Pannier, CFO, Carl Karcher Enterprises, 714-778-7109; or Roger Pondel, Pondel Parsons & Wilkinson, 310-207-9300/
 (CARL)


CO: Carl Karcher Enterprises Inc. ST: California IN: LEI SU: ERN

JL-MF -- LA016 -- 9641 09/08/93 09:02 EDT
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Date:Sep 8, 1993
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