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FOODMAKER REPORTS RESULTS FOR FISCAL 1993

 SAN DIEGO, Nov. 10 /PRNewswire/ -- Foodmaker Inc. (NYSE: FM), the operator and franchisor of JACK IN THE BOX and CHI-CHI's restaurant chains, today announced losses before the cumulative effect on prior years of adopting Statement of Financial Accounting Standards (SFAS) 106 and SFAS 109 for the fiscal year ended Oct. 3, 1993, of $44.1 million, or $1.15 per share, compared to earnings of $21.9 million, or 67 cents a share, before an extraordinary item in fiscal 1992.
 For the fourth quarter of fiscal 1993, the company reported losses of $2.7 million, or 7 cents a share, compared to earnings of $8.6 million, or 21 cents a share, for the fourth quarter of 1992.
 Foodmaker attributed the loss primarily to a decline in average restaurant sales and increased costs resulting from the January incident of food-borne illness in the Pacific Northwest, as well as adoption of new accounting standards.
 Adoption of New Accounting Standards:
 Effective Sept. 28, 1992, Foodmaker adopted SFAS 106, "Employers' Accounting for Postretirement Benefits Other Than Pensions," which requires the company to accrue costs of postretirement benefits over employees' active service periods, and SFAS 109, "Accounting for Income Taxes," which requires the use of the liability method of accounting for deferred income taxes. Adoption of SFAS 106 and 109 increased costs by $2.9 million in fiscal 1993 and generated a charge to earnings of $54 million, or $1.40 per share, for the cumulative effect on prior years.
 Sales Performance:
 JACK IN THE BOX finished 1993 with comparable 52-week restaurant sales averages 7.4 percent below averages for fiscal 1992. For the fourth quarter of fiscal 1993, comparable restaurant sales averages declined 8.8 percent, compared to the same period one year ago.
 "Although sales continue to lag performance a year ago, we remain gratified by the overall improvement in sales from earlier in fiscal 1993," said Jack Goodall, Foodmaker president and chief executive officer. "We attribute this recovery primarily to our swift response to the January incident, our aggressive marketing strategies and our innovative menu developments."
 JACK IN THE BOX comparable restaurant sales averages were up 6.2 percent in the first quarter, compared to averages in 1992. In the second and third quarters of 1993, comparable restaurant sales averages declined 22.2 percent and 9.2 percent, respectively, compared to averages for the same periods in 1992.
 "While we would have preferred to see sales improve more dramatically in the fourth quarter, it is important to note that sales in that period were being compared to outstanding sales gains in the fourth quarter of 1992," said Goodall. "In fact, these tough comparisons will continue into the first quarter of 1994."
 During the fourth quarter of 1993, the chain introduced The Teriyaki Bowls, a new product line of Japanese-inspired menu items that feature marinated chicken breast or strips of beef and freshly steamed vegetables served over a bed of steamed rice and topped with tangy teriyaki sauce. The Chicken Teriyaki Bowl has less than two grams of total fat.
 Other products launched during the year included The Beef Gyro and The Smoked Chicken, Cheddar and Bacon Sandwich. In late September, JACK IN THE BOX introduced a new hamburger, the Colossus, to restaurants in Texas, and launched the product systemwide in early November. The Colossus features two quarter-pound patties (net weight before cooking), three types of cheese and eight half-slices of bacon on a sesame seed bun.
 "Together, these products make a significant contribution to our overall sales and are evidence of the enduring strength of our exceptional product development capability," said Goodall.
 Comparable 52-week restaurant sales averages at CHI-CHI's declined 5.2 percent in 1993, compared to 1992 sales averages. In the fourth quarter, CHI-CHI's sales were down 5.5 percent, compared to the same period one year ago.
 "While sales at CHI-CHI's fell behind year-ago levels in fiscal 1993, we are encouraged by improvements in sales in early fiscal 1994," said Goodall. "We recently resumed our restaurant refurbishment plans, which were suspended for much of 1993 in order to preserve capital. We are confident that upgrading the restaurants will be a boost to sales at CHI-CHI's."
 Financial Highlights:
 Foodmaker systemwide sales, which includes franchise restaurant sales, were $1,459.2 million for fiscal 1993 and $366.5 million for the fourth quarter of 1993, compared to $1,486.5 million for fiscal 1992 and $354.5 million for 1992's fourth quarter.
 Total revenues for fiscal 1993 were $1,240.7 million, compared to $1,219.3 million in 1992. For the fourth quarter of 1993, total revenues were $312.2 million, compared to $292.1 million for the same period one year ago.
 Selling, general and administrative expenses were $124.4 million for fiscal 1993 and $27.6 million for 1993's fourth quarter, compared to $103.7 million for fiscal 1992 and $25.4 million for the fourth quarter of 1992. Increased marketing expenses and one-time costs associated with the January incident were primary reasons for the increase in expenses.
 Interest expense for the 1993 fiscal year was $57.6 million, compared to $72.5 million in 1992, reflecting the benefits of the company's 1992 recapitalization. For the fourth quarter, interest expense rose to $14.4 million, compared to $12.9 million for the same period a year earlier, due primarily to an additional week in fiscal 1993 and the fourth quarter of 1993.
 Foodmaker's fiscal year ends on the Sunday closest to Sept. 30, which made Oct. 3, 1993, its 1993 fiscal year end, and provided an additional week when compared to fiscal 1992 and the fourth quarter of 1992.
 Progress Continues on REG Transaction:
 During the fourth quarter, the company made progress in its transaction to sell CHI-CHI's. Under definitive agreements with W.R. Grace & Co. and Restaurant Enterprises Group Inc. (REG), subject to certain conditions, Foodmaker, Apollo Advisors and Leonard Green & Partners will acquire REG, which will simultaneously acquire CHI-CHI's. REG owns and operates various chains, including Carrows, Coco's and El Torito.
 Foodmaker will contribute CHI-CHI's in exchange for a 40.6 percent equity position in REG, to be renamed Family Restaurants Inc. (FRI), and approximately $200 million in cash to be raised through issuance of notes by FRI. Foodmaker will also receive warrants to acquire an additional 10 percent interest in FRI.
 "We expect this transaction to close in January of 1994," said Goodall. "With the cash received, we will be able to substantially reduce our debt encumbrance."
 Foodmaker's long-term debt excluding current maturities stood at approximately $500.5 million at the end of fiscal 1993, compared to $501.1 million at fiscal year-end 1992.
 Unit Growth:
 The number of company-operated JACK IN THE BOX restaurants grew to 725 at the end of fiscal 1993, compared to 720 one year ago and franchised units rose to 447, compared to 435 one year ago.
 JACK IN THE BOX owns, operates and franchises 1,172 restaurants primarily in the southwestern and western United States. Under current plans, JACK IN THE BOX intends to open approximately 50 new company- operated restaurants in fiscal 1994.
 The number of company-operated CHI-CHI's restaurants stood at 207 at the end of fiscal 1993, compared to 181 one year ago. Franchised units totaled 28, compared to 51 at the end of 1992. CHI-CHI's, the nation's largest full-service Mexican restaurant chain, owns and operates 235 restaurants.
 FOODMAKER INC. AND SUBSIDIARIES
 Unaudited Consolidated Statements of Operations
 (In thousands, except per share data)
 13 weeks 12 weeks 53 weeks 52 weeks
 ended ended ended ended
 Oct. 3, Sept. 27, Oct. 3, Sept. 27,
 1993 1992 1993 1992
 Revenues:
 Restaurant sales $273,403 $253,196 $1,088,269 $1,061,904
 Distribution sales 28,413 24,698 108,546 104,041
 Franchise rents
 and royalties 8,474 9,171 35,232 38,803
 Other 1,934 5,013 8,657 14,585
 Total 312,224 292,078 1,240,704 1,219,333
 Costs and expenses:
 Costs of revenues:
 Restaurant cost
 of sales 80,705 72,509 315,456 309,380
 Restaurant
 operating costs 159,987 137,859 636,918 576,221
 Cost of distribution
 sales 27,858 23,590 104,817 97,873
 Franchised restaurant
 costs 5,707 5,291 67,704 20,993
 Selling, general and
 administrative 27,587 25,356 124,422 103,697
 Interest expense 14,390 12,944 57,586 72,455
 Total 316,234 277,549 1,306,903 1,180,619
 Earnings (loss) before
 income taxes,
 extraordinary item
 and cumulative effect
 of changes in
 accounting principles (4,010) 14,529 (66,199) 38,714
 Income taxes (benefit) (1,337) 5,934 (22,071) 16,818
 Earnings (loss) before
 extraordinary item and
 cumulative effect of
 changes in
 accounting principles (2,673) 8,595 (44,128) 21,896
 Extraordinary item --
 loss on early
 extinguishment of debt,
 net of taxes --- --- --- (63,651)
 Cumulative effect on
 prior years
 (to Sept. 27, 1992)
 of adopting SFAS 106
 and SFAS 109 --- --- (53,980) ---
 Net earnings (loss) ($2,673) $8,595 ($98,108) ($41,755)
 Earnings (loss)
 per share - primary
 and fully diluted:
 Earnings (loss)
 before extraordinary
 item and cumulative
 effect of changes in
 accounting principles ($.07) $.21 ($1.15) $.67
 Extraordinary item --- --- --- (1.95)
 Cumulative effect on
 prior years
 (to Sept. 27, 1992)
 of adopting SFAS 106
 and SFAS 109 --- --- (1.40) ---
 Net earnings (loss)
 per share ($.07) $.21 ($2.55) ($1.28)
 Weighted average shares
 outstanding 38,223 40,286 38,486 32,577
 -0- 11/10/93
 /CONTACT: Sheree Zizzi of Foodmaker, 619-571-2248/
 (FM)


CO: Foodmaker Inc. ST: California IN: LEI SU: ERN

NY-JL -- SD003 -- 2598 11/10/93 09:02 EST
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Date:Nov 10, 1993
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