NET INCOME UP 38 PERCENT FOR FIRST QUARTER 1992
NET INCOME UP 38 PERCENT FOR FIRST QUARTER 1992 LOUISVILLE, Ky., April 27 /PRNewswire/ -- Rally's Inc.
(NASDAQ: RLLY), the fastest-growing restaurant chain in America and the nation's largest double drive-thru hamburger chain, reported record first quarter earnings. Net income of $1.5 million grew 38 percent, compared with net income of $1.1 million for the quarter ended a year ago. Earnings per share of $.20 advanced 33 percent from earnings per share of $.15 for the same quarter in the prior year.
Income from operations grew 52 percent to $2.6 million, compared with $1.7 million in the prior year. Wayne Albritton, president and chief operating officer, said, "We are ecstatic about the growth in our income from operations and net income considering that we rebated $700,000 in royalties to our franchisees in the current quarter as part of our Advertising and Royalty Reduction Program which concluded March 31, 1992." Substantially all of the company's franchisees participated in this program which resulted in 50 percent of the royalties which would have been paid to the company being rebated back to the participants. This program resulted in the franchisees strengthening their sales and use of the company's award-winning and highly effective television and radio advertising. Albritton noted that same store sales for the chain increased 5 percent in the current quarter, but have gotten even stronger in recent weeks. "The strength of our sales in the first quarter have continued to surge ahead as same store sales have grown 11 percent over prior-year levels since the quarter ended. The results of our first quarter and the past few weeks have set the stage for an outstanding year of growth for our company. We plan to open 95 new restaurants in addition to the 45 restaurants we are acquiring from Zipp's by the end of 1992," Albritton said. The company recently announced its signing of a letter of intent to acquire Zipp's Drive-Thru Inc., a chain of 45 double drive thru hamburger restaurants, 24 of which are located in St. Louis. Albritton said, "The acquisition of Zipp's fits the long-term strategic growth plans of the company which is to dominate our existing or contiguous markets. We have the hottest television commercials in the country and we are concentrating our development of new restaurants in our existing markets in order to take advantage of our media efficiencies to promote Rally's. The concentration of Zipp's in St. Louis will allow us to immediately promote Rally's on television." Systemwide sales for the first quarter of 1992 increased 41 percent to $66.2 million, compared with $46.8 million a year ago. Rally's company-owned restaurant sales grew 35 percent to $23.7 million, compared with $17.6 million a year ago. At April 24, 1992, there were 343 units in operation in 22 states excluding the 45 restaurants to be acquired from Zipp's. RALLY'S INC. AND SUBSIDIARIES Consolidated Statements of Operations (Amounts in thousands, except per share information) (Subject to year-end audit and review) 14 weeks ended 13 weeks ended April 5, March 31, 1992 1991 Systemwide sales $66,162 $46,793 Total revenues $24,989 $19,671 Total costs and expenses 22,403 17,967 Income from operations 2,586 1,704 Total other income (expense) (159) 31 Income before income taxes 2,427 1,735 Provision for income taxes 890 625 Net income $1,537 $1,110 Weighted average shares outstanding 7,878 7,356 Earnings per share $.20 $.15 -0- 4/27/92 /CONTACT: Donald C. Moore, senior VP and CFO of Rally's, 502-245-8900/ (RLLY) CO: Rally's Inc. ST: Kentucky IN: LEI SU: ERN
JL -- LA019 -- 3229 04/27/92 13:40 EDT
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|Date:||Apr 27, 1992|
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