Carrols Restaurant Group, Inc. Reports Financial Results for the Fourth Quarter and Full Year 2011
Spin-off of
The Company also announced that its tax-free spin-off of
Highlights for the fourth quarter of 2011 versus the fourth quarter of 2010 include:
-
Total revenues increased 4.5% to
$203.6 million in the fourth quarter of 2011 compared to$194.9 million in the fourth quarter of 2010. Revenues forFiesta Restaurant Group, Inc. increased 7.0% to$116.9 million from$109.3 million in the same period last year. - Comparable restaurant sales increased 1.5% at Burger King®, 7.8% at Pollo Tropical and 2.7% at Taco Cabana;
-
Net income for the fourth quarter of 2011 was
$59,000 , or$0.00 per diluted share, compared to net income of$2.6 million , or$0.12 per diluted share in the fourth quarter of 2010; and -
Earnings in the fourth quarter of 2011 included certain charges
totaling
$2.8 million , or$0.09 per diluted share after tax, consisting primarily of impairment and other lease charges, and spin-off costs and other related expenses. Earnings in the fourth quarter of 2010 included impairment and other lease charges of$3.2 million , or$0.10 per diluted share after tax, and favorable adjustments to the Company's tax provision of$0.6 million , or$0.03 per diluted share.
Highlights for the full year 2011 versus the full year 2010 include:
-
Total revenues increased 3.3% to
$822.5 million in 2011 compared to$796.1 million in 2010. Revenues forFiesta Restaurant Group, Inc. increased 8.2% to$475.0 million from$439.1 million in 2010; - Comparable restaurant sales decreased 1.4% at Burger King, but increased 9.9% at Pollo Tropical and 3.7% at Taco Cabana; and
-
Net income for 2011 was
$11.2 million , or$0.51 per diluted share, compared to net income of$11.9 million , or$0.55 per diluted share in 2010. Both years included certain charges which in the aggregate reduced earnings by$0.25 per diluted share in 2011 and$0.21 per diluted share in 2010.
As of
Commenting on the Company's Burger King restaurant business, Daniel T.
Accordino, Chief Executive Officer of
Accordino continued, "Burger King is in the process of implementing a number of initiatives to effect its repositioning within the quick-service segment. These include modifications and upgrades to its products, menu structure, food preparation, image and marketing. While still in the early stages of this transformation, we anticipate the official launch of certain of these enhancements and operational changes in April. We believe that these initiatives have the potential to provide increasing momentum for the brand and sustainable traction in its performance."
Commenting on the Company's Pollo Tropical and Taco Cabana restaurant
businesses,
Taft continued, "Looking ahead, the Fiesta story will be centered on two well-positioned, differentiated brands with compelling opportunities, and predicated on three key initiatives: a) driving comparable restaurant sales by leveraging our favorable brand attributes; b) strategic new unit development and remodeling; and c) improving margins through operating leverage, commodity contracting and supply chain initiatives. With the spin-off nearly complete, we are very excited to soon be starting our corporate life as an independent company."
Fourth Quarter 2011 Results
Total revenues increased 4.5% to
Burger King revenues increased 1.2% to
Pollo Tropical revenues increased 9.6% to
Taco Cabana revenues increased 5.1% to
Income from operations was
Interest expense increased to
Net income for the fourth quarter of 2011 was
Full Year 2011 Results
Total revenues increased 3.3% to
Full Year 2012 Guidance
Given that the spin-off of
Full Year 2012 Guidance for
- Comparable restaurant sales are expected to increase 3% to 5% for Burger King;
- Commodity costs are expected to increase 3% to 4% for Burger King;
- Four Burger King restaurants are expected to close; and
-
Capital expenditures are estimated to be
$20 million to $25 million .
Full Year 2012 Guidance for
- Comparable restaurant sales are expected to increase approximately 4% to 6% for both Pollo Tropical and Taco Cabana;
- Commodity costs are expected to increase 1% to 2% for Pollo Tropical and 2.5% to 3.5% for Taco Cabana;
- Approximately 10 to 12 new restaurants are expected to be opened and two to four existing restaurants are expected to be closed; and
-
Capital expenditures are estimated to be
$40 million to $45 million .
Conference Call Today
The Company will host a conference call to discuss the fourth quarter
and full year 2011 financial results today at
The conference call can be accessed live over the phone by dialing
877-941-4774 or for international callers by dialing 480-629-9760. A
replay will be available one hour after the call and can be accessed by
dialing 800-406-7325 or for international callers by dialing
303-590-3030; the passcode is 4518839. The replay will be available
until
About the Company
Forward-Looking Statements
Except for the historical information contained in this news release,
the matters addressed are forward-looking statements. Forward-looking
statements, written, oral or otherwise made, represent the Company's
expectation or belief concerning future events. Without limiting the
foregoing, these statements are often identified by the words "may,"
"might," "believes," "thinks," "anticipates," "plans," "expects",
"intends" or similar expressions. In addition, expressions of our
strategies, intentions or plans, (including, without limitation, the
Company's spin-off transaction) are also forward-looking statements.
Such statements reflect management's current views with respect to
future events and are subject to risks and uncertainties, both known and
unknown. You are cautioned not to place undue reliance on these
forward-looking statements as there are important factors that could
cause actual results to differ materially from those in forward-looking
statements, many of which are beyond our control. Investors are referred
to the full discussion of risks and uncertainties as included in the
Company's and Carrols Corporation's filings with the
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Consolidated Statements of Operations | ||||||||||||||||||||||||
(in thousands except per share amounts) | ||||||||||||||||||||||||
(unaudited) | ||||||||||||||||||||||||
Three Months Ended | Twelve Months Ended | |||||||||||||||||||||||
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2011 | 2010 | 2011 | 2010 | |||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||
Restaurant sales | $ | 203,171 | $ | 194,531 | $ | 820,767 | $ | 794,611 | ||||||||||||||||
Franchise royalty revenues and fees | 477 | 368 | 1,719 | 1,533 | ||||||||||||||||||||
Total revenues | 203,648 | 194,899 | 822,486 | 796,144 | ||||||||||||||||||||
Costs and expenses: | ||||||||||||||||||||||||
Cost of sales | 64,383 | 58,375 | 256,571 | 240,635 | ||||||||||||||||||||
Restaurant wages and related expenses (b) | 59,291 | 57,303 | 238,254 | 235,075 | ||||||||||||||||||||
Restaurant rent expense | 12,200 | 11,955 | 48,727 | 48,578 | ||||||||||||||||||||
Other restaurant operating expenses | 28,013 | 27,657 | 115,266 | 114,643 | ||||||||||||||||||||
Advertising expense | 7,443 | 6,902 | 30,688 | 30,362 | ||||||||||||||||||||
General and administrative expenses (b) | 15,781 | 13,825 | 57,088 | 51,021 | ||||||||||||||||||||
Depreciation and amortization | 8,779 | 8,144 | 33,522 | 32,459 | ||||||||||||||||||||
Impairment and other lease charges | 1,993 | 3,231 | 4,037 | 7,323 | ||||||||||||||||||||
Other income | (231 | ) | (44 | ) | (574 | ) | (444 | ) | ||||||||||||||||
Total costs and expenses | 197,652 | 187,348 | 783,579 | 759,652 | ||||||||||||||||||||
Income from operations | 5,996 | 7,551 | 38,907 | 36,492 | ||||||||||||||||||||
Interest expense | 6,082 | 4,661 | 21,031 | 18,805 | ||||||||||||||||||||
Loss on extinguishment of debt | 21 | - | 2,470 | - | ||||||||||||||||||||
Income (loss) before income taxes | (107 | ) | 2,890 | 15,406 | 17,687 | |||||||||||||||||||
Provision (benefit) for income taxes | (166 | ) | 316 | 4,188 | 5,771 | |||||||||||||||||||
Net income | $ | 59 | $ | 2,574 | $ | 11,218 | $ | 11,916 | ||||||||||||||||
Basic net income per share | $ | 0.00 | $ | 0.12 | $ | 0.52 | $ | 0.55 | ||||||||||||||||
Diluted net income per share | $ | 0.00 | $ | 0.12 | $ | 0.51 | $ | 0.55 | ||||||||||||||||
Basic weighted average common shares outstanding |
21,715 |
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21,626 |
21,678 |
21,621 |
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Diluted weighted average common shares outstanding |
22,369 |
21,883 |
22,207 |
21,835 |
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(a) |
The Company uses a 52 or 53 week fiscal year that ends on the Sunday
closest to |
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(b) |
Restaurant wages and related expenses include stock-based
compensation expense of |
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The following table sets forth certain unaudited supplemental financial and other restaurant data for the periods indicated (in thousands, except number of restaurants): |
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(unaudited) | (unaudited) | |||||||||||||||||||||||
Three Months Ended | Twelve Months Ended | |||||||||||||||||||||||
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December 31, | |||||||||||||||||||||||
2011 | 2010 | 2011 | 2010 | |||||||||||||||||||||
Segment revenues: | ||||||||||||||||||||||||
Burger King | $ | 86,702 | $ | 85,642 | $ | 347,518 | $ | 357,073 | ||||||||||||||||
Pollo Tropical | 51,972 | 47,420 | 209,525 | 187,293 | ||||||||||||||||||||
Taco Cabana | 64,974 | 61,837 | 265,443 | 251,778 | ||||||||||||||||||||
Total revenues | $ | 203,648 | $ | 194,899 | $ | 822,486 | $ | 796,144 | ||||||||||||||||
Change in comparable restaurant sales: (a) | ||||||||||||||||||||||||
Burger King | 1.5 | % | (6.1 | )% | (1.4 | )% | (4.3 | )% | ||||||||||||||||
Pollo Tropical | 7.8 | % | 10.7 | % | 9.9 | % | 7.4 | % | ||||||||||||||||
Taco Cabana | 2.7 | % | 2.3 | % | 3.7 | % | 0.3 | % | ||||||||||||||||
Adjusted Segment EBITDA: (b) | ||||||||||||||||||||||||
Burger King | $ | 2,004 | $ | 4,054 | $ | 14,404 | $ | 19,756 | ||||||||||||||||
Pollo Tropical | 8,560 | 7,939 | 36,783 | 30,300 | ||||||||||||||||||||
Taco Cabana | 6,635 | 7,308 | 27,484 | 27,425 | ||||||||||||||||||||
Average sales per restaurant: (c) | ||||||||||||||||||||||||
Burger King | $ | 293 | $ | 282 | $ | 1,154 | $ | 1,162 | ||||||||||||||||
Pollo Tropical | 567 | 517 | 2,287 | 2,053 | ||||||||||||||||||||
Taco Cabana | 411 | 397 | 1,690 | 1,616 | ||||||||||||||||||||
New restaurant openings: | ||||||||||||||||||||||||
Burger King | - | - | 2 | 1 | ||||||||||||||||||||
Pollo Tropical | - | 2 | 2 | 2 | ||||||||||||||||||||
Taco Cabana | - | - | 4 | 1 | ||||||||||||||||||||
Total new restaurant openings | - | 2 | 8 | 4 | ||||||||||||||||||||
Restaurant closings: | ||||||||||||||||||||||||
Burger King | (4 | ) | (1 | ) | (9 | ) | (8 | ) | ||||||||||||||||
Pollo Tropical | - | (1 | ) | (2 | ) | (2 | ) | |||||||||||||||||
Taco Cabana | - | (1 | ) | (1 | ) | (2 | ) | |||||||||||||||||
Net new restaurants | (4 | ) | (1 | ) | (4 | ) | (8 | ) | ||||||||||||||||
Number of company owned restaurants: | ||||||||||||||||||||||||
Burger King | 298 | 305 | ||||||||||||||||||||||
Pollo Tropical | 91 | 91 | ||||||||||||||||||||||
Taco Cabana | 158 | 155 | ||||||||||||||||||||||
Total company owned restaurants | 547 | 551 | ||||||||||||||||||||||
At |
At |
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Long-term debt (d) | $ | 278,583 | $ | 263,513 | ||||||||||||||||||||
Cash | 24,661 | 3,144 |
(a) | Restaurants are included in comparable restaurant sales after they have been open for 12 months for Burger King restaurants and 18 months for Pollo Tropical and Taco Cabana restaurants. | ||
(b) |
Adjusted Segment EBITDA is defined as earnings attributable to the
applicable segment before interest, income taxes, depreciation and
amortization, impairment and other lease charges, stock-based
compensation expense, other income and expense and gains or losses
on extinguishment of debt. Adjusted Segment EBITDA is used because
it is the measure of segment profit or loss reported to our chief
operating decision maker for purposes of allocating resources to the
segments and assessing each segment's performance. This may not be
necessarily comparable to other similarly titled captions of other
companies due to differences in methods of calculation. Adjusted
Segment EBITDA for our Burger King restaurants includes general and
administrative expenses related directly to the Burger King segment
as well as the expenses associated with administrative support to
all three of the Company's segments including executive management,
information systems and certain accounting, legal and other
administrative functions. For the three and twelve months ended
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(c) | Average sales for company-owned or operated restaurants are derived by dividing restaurant sales for such period for the applicable segment by the average number of restaurants for the applicable segment for such period. | ||
(d) |
Long-term debt (including current portion) at |
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