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NE Restaurant Company, Inc. Announces 79% Increase In Second Quarter Operating Income.

MAYNARD, Mass., Aug. 4 /PRNewswire/ --

NE Restaurant Company, Inc. (NERCO) reported total operating income increased 79.2% to $3.2 million in the second quarter ended June 28, 2000 from $1.8 million for the same period last year. EBITDA (Earnings Before Interest, Taxes, Depreciation, Amortization and Preopening Expenses) increased 21.7% to $7.8 million in the second quarter compared to $6.4 million for the same period last year. For the six months ended June 28, 2000, operating income increased 83.8% to $4.7 million from $2.6 million and EBITDA increased 21.2% to $13.8 million from $11.4 million.

Total net sales increased 5.5% to $71.3 million in the second quarter from $67.6 million for the same period last year. Exclusive of the 17 underperforming restaurants closed at Bertucci's as of January 31, 2000, total net sales increased 12.8% in the second quarter. Comparable restaurant net sales in the second quarter increased 7.7%: 10.2% at Bertucci's, 5.5% at Chili's and 1.2% at On The Border. For the six months, total net sales increased 5.9% to $138.4 million from $130.7 million and comparable restaurant net sales increased 6.7%: 7.7% at Bertucci's, 6.0% at Chili's and 1.6% at On The Border.

Ben Jacobson, Chairman and President of NERCO, stated "We are very pleased that our operating results have improved dramatically. The improvement at Bertucci's is especially important as we prepare for expansion of the concept later this year. The comparable restaurant net sales increases at Bertucci's are the result of new and exciting menu item introductions that will expand and enhance the dining experience of all of our guests, combined with innovative marketing programs and improved operations at our restaurants. We are also pleased to report that Chili's continues to generate strong comparable restaurant net sales increases with corresponding improvement in cash contribution."

During the second quarter, the Company opened one Chili's restaurant in Raynham, Massachusetts.

NERCO is a leading operator of full-service, casual dining restaurants in the Northeast. The Company's wholly owned subsidiary, Bertucci's Restaurant Corp., owns and operates restaurants under the name Bertucci's Brick Oven Pizzeria. The Company also develops and operates Chili's and On The Border restaurants under franchise agreements with Brinker International, Inc. The Company is the world's largest Chili's franchisee. There were 72 Bertucci's restaurants, 39 Chili's restaurants, seven On The Border restaurants and one Sal & Vinnie's Sicilian Steakhouse in operation as of June 28, 2000.

This press release is comprised of statements relating to future results of the Company (including development plans, projections and business trends) that are "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those projected as a result of certain risks set forth in the Company's Form 10K filed with the Securities and Exchange Commission for the year ended December 29, 1999.

FINANCIAL SUMMARY (Unaudited Results)




Three Months Ended Six Months Ended

June 28, June 30, June 28, June 30,

2000 1999 2000 1999

Net Sales 71,345 67,648 138,380 130,682

Cost of Sales and Expenses

Cost of sales 18,799 18,273 36,362 35,626

Operating expenses 40,614 39,224 79,572 76,217

General and


expenses 4,135 3,743 8,623 7,432

Deferred rent,



and preopening

expenses 4,559 4,601 9,089 8,833

Total cost of sales

and expenses 68,107 65,841 133,646 128,108

Income from operations 3,238 1,807 4,734 2,574

Interest expense, net 3,706 3,431 7,380 6,794

Loss before income

tax benefit (468) (1,624) (2,646) (4,220)

Income tax benefit (17) (461) (723) (1,406)

Loss before cumulative

effect of change in

accounting principle (451) (1,163) (1,923) (2,814)

Cumulative effect of

change in accounting

principle (net of tax) -- (678)

Net loss (451) (1,163) (1,923) (3,492)

Basic and diluted

loss per share $(0.15) $(0.39) $(0.64) $(1.17)

Weighted average

shares outstanding 2,981,281 2,977,026 2,983,966 2,977,026

Other Financial Data

EBITDA 7,797 6,408 13,823 11,408

Total Debt 139,800 134,820

Ratio of Total Debt to

Rolling 12-Month EBITDA 5.36:1.00 5.94:1.00




As of As of

June 28, December 29,

2000 1999


Current Assets:

Cash 5,577 7,579

Receivables 1,459 1,631

Inventories 2,088 1,804

Other current assets 594 2,516

Deferred income taxes 8,648 8,648

Total current assets 18,366 22,178

Net property and equipment 117,821 118,010

Other long term assets 46,762 49,390

TOTAL ASSETS $182,949 $ 189,578


Current Liabilities:

Accounts payable 7,841 13,721

Accrued expenses 25,278 23,338

Other current liabilities 1,328 1,328

Total current liabiliites 34,447 38,387

Long term debt 138,472 138,075

Other long term liabilities 4,498 5,590

Total liabilities 177,417 182,052

Stockholders' Equity 5,532 7,526

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Publication:PR Newswire
Date:Aug 4, 2000
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