Frisch's Reports Higher Sales and Earnings In Second Quarter of Fiscal 2012

CINCINNATI, Jan. 10, 2012 /PRNewswire/ -- Frisch's Restaurants, Inc. (NYSE Amex: FRS) reported higher earnings and revenue for its 12-week fiscal second quarter ended December 13, 2011.  Net earnings for the quarter increased 12.2 percent to $2,788,106 compared to $2,484,877 last year, largely the result of a lower effective tax rate. Diluted net earnings per share increased 14.3 percent to $0.56 per share, from $0.49 per share last year.  Revenue increased modestly to $70,741,753 from $70,651,447 in last year's second quarter.  However, negatively affecting the revenue comparison is the closure of six underperforming Golden Corral units on August 23, 2011. Excluding the impact of these closures, revenue increased 4.0 percent in the quarter on solid growth in the Golden Corral segment. Year-to-date revenue was $162,469,942 versus $163,577,281 in the prior year.  Excluding the impact of the Golden Corral closures, year-to-date revenue grew 1.7 percent over the same period in fiscal 2011.

In our Big Boy segment, same store sales were up 0.4 percent while overall sales increased 2.3 percent as a result of new store openings.  Gross profit in the Big Boy segment declined 6.6 percent in the quarter versus prior year primarily as a result of higher food and paper costs and depreciation expense.  Higher food costs continue to reflect industry trends driven by increased costs of beef and other raw materials. 

Same store sales in our Golden Corral segment increased 7.8 percent.  Gross profit in the Golden Corral segment increased 39.1 percent in the quarter versus prior year as a result of increased same store revenue combined with the elimination of losses generated by the closed stores. 

Craig F. Maier, President and Chief Executive Officer, commented on the results, "Although the restaurant industry continues to suffer from declining customer counts and over capacity driven by the soft economy, the strength of our company's brands allowed us to deliver solid results in the quarter.  Our Golden Corral restaurants posted a strong same store sales increase during the quarter as the national marketing campaigns of Golden Corral drove revenue gains along with the migration of some customers from our six closed restaurants to nearby locations."   

The company opened one new Big Boy restaurant in July in our first quarter and a second restaurant in October in our second quarter.  Frisch's currently operates 95 company-owned Big Boy restaurants and there are an additional 25 franchised Big Boy restaurants operated by licensees.  The company also operates 29 Golden Corral restaurants. 

[See attached Financial Statements]

Frisch's Restaurants, Inc. is a regional company that operates full service family-style restaurants under the name "Frisch's Big Boy."  The company also operates grill buffet style restaurants under the name "Golden Corral" pursuant to certain licensing agreements.  All Big Boy restaurants are currently located in various regions of Ohio, Kentucky and Indiana. Golden Corral restaurants currently operate primarily in the greater metropolitan areas of Cincinnati, Cleveland, Columbus, Dayton and Toledo, Ohio; Louisville, Kentucky and Pittsburgh, Pennsylvania. 

The company owns the trademark "Frisch's" and has exclusive, irrevocable ownership of the rights to the "Big Boy" trademark, trade name and service marks in the states of Kentucky and Indiana, and in most of Ohio and Tennessee.  All of the Frisch's Big Boy restaurants also offer "drive-thru" service.  The company also licenses Big Boy restaurants to other operators, currently in certain parts of Ohio, Kentucky and Indiana.

The company has reported a profit every year since going public in 1960, and paid cash dividends to shareholders every quarter over the same period.

Statements contained in this press release which are not historical facts are forward looking statements as that item is defined in the Private Securities Litigation Act of 1995. Such forward looking statements are subject to risks and uncertainties which could cause actual results to differ materially from estimated results. Such risks and uncertainties are detailed in the company's filings with the Securities and Exchange Commission.

 

Frisch's Restaurants, Inc. and Subsidiaries

CONSOLIDATED STATEMENT OF EARNINGS (unaudited)

(In thousands, except per share data)

 

 

 

 

 

 

 

 

 

 

 

 

Twenty-eight weeks ended

 

Twelve weeks ended

 

 

 

December 13,

 

December 14,

 

December 13,

 

December 14,

 

 

 

2011

 

2010

 

2011

 

2010

 

 

 

 

 

 

 

 

 

 

 

Sales

$    162,470

 

$    163,577

 

$    70,742

 

$   70,651

 

Cost of sales

 

 

 

 

 

 

 

 

 

Food and paper

57,223

 

56,080

 

24,766

 

24,100

 

 

Payroll and related

54,160

 

54,382

 

23,365

 

23,617

 

 

Other operating costs

36,877

 

36,797

 

15,355

 

15,534

 

 

 

148,260

 

147,259

 

63,486

 

63,251

 

Gross profit

14,210

 

16,318

 

7,256

 

7,400

 

 

Administrative and advertising

9,484

 

8,805

 

3,890

 

3,992

 

 

Franchise fees and other revenue

(694)

 

(696)

 

(304)

 

(296)

 

 

Impairment of long-lived assets

4,000

 

-

 

-

 

-

 

Operating profit 

1,420

 

8,209

 

3,670

 

3,704

 

 

Interest expense

808

 

849

 

351

 

375

 

Earnings before income tax

612

 

7,360

 

3,319

 

3,329

 

Income taxes

98

 

2,134

 

531

 

844

 

NET EARNINGS

$          514

 

$       5,226

 

$      2,788

 

$     2,485

 

 

 

 

 

 

 

 

 

 

 

Earnings per share (EPS) of common stock:

 

 

 

 

 

 

 

 

Basic net earnings per share

$.10

 

$1.03

 

$.57

 

$.49

 

 

Diluted net earnings per share

$.10

 

$1.02

 

$.56

 

$.49

 

Diluted average shares outstanding

4,939

 

5,112

 

4,937

 

5,098

 

Depreciation included above

$       8,113

 

$       8,287

 

$      3,429

 

$     3,725

 

Opening expense included above

$          398

 

$          916

 

$        115

 

$       368

 

 

 

 

 

 

 

 

 

 

 

  

Frisch's Restaurants, Inc. and Subsidiaries

CONSOLIDATED BALANCE SHEET

(In thousands of dollars)

 

 

 

December 13,

 

May 31,

 

 

 

 

2011

 

2011

 

 

 

 

(unaudited)

 

 

 

Assets

 

 

 

 

 

Current assets

 

 

 

 

 

 

Cash and equivalents

$     1,744

 

$     2,449

 

 

 

Receivables

1,432

 

1,997

 

 

 

Inventories

6,429

 

5,717

 

 

 

Other current assets

4,841

 

4,697

 

 

 

 

14,446

 

14,860

 

 

Property and equipment

161,500

 

172,922

 

 

Other assets

 

 

 

 

 

 

Goodwill & other intangible assets

1,138

 

1,237

 

 

 

Property held for sale and land investments

11,131

 

3,845

 

 

 

Deferred income taxes and other

2,214

 

2,410

 

 

 

 

14,483

 

7,492

 

 

 

 

 

 

 

 

 

 

 

$ 190,429

 

$ 195,274

 

 

 

 

 

 

 

 

Liabilities and shareholders' equity

 

 

 

 

 

Current liabilities

 

 

 

 

 

 

Accounts payable

$   10,035

 

$   10,216

 

 

 

Accrued expenses

10,254

 

10,083

 

 

 

Other

9,650

 

8,801

 

 

 

 

29,939

 

29,100

 

 

 

 

 

 

 

 

 

Long-term obligations

 

 

 

 

 

 

Long-term debt

19,205

 

22,573

 

 

 

Other long-term obligations

16,234

 

18,073

 

 

 

 

35,439

 

40,646

 

 

 

 

 

 

 

 

 

Shareholders' equity

125,051

 

125,528

 

 

 

 

 

 

 

 

 

 

 

$ 190,429

 

$ 195,274

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SOURCE Frisch's Restaurants, Inc.



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http://www.frischs.com

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