Carrols Restaurant Group, Inc. Reports Financial Results for the Third Quarter of 2010
Company to Present at Investor Conference on
Highlights for the third quarter of 2010 versus the third quarter of 2009 include:
-
Net income of
$4.6 million , or$0.21 per diluted share (including a pre-tax insurance gain of$0.4 million , or$0.01 per diluted share after tax), compared to net income of$5.6 million , or$0.26 per diluted share (including a pre-tax gain on the sale of excess property of$0.2 million , or$0.01 per diluted share after tax); -
Total revenues increased to
$201.6 million from$201.2 million , with a 4.0% increase in revenues for the Company's Hispanic Brands; and - Comparable restaurant sales increased 8.8% at Pollo Tropical®, increased 1.0% at Taco Cabana® and decreased 3.2% at Burger King®;
As of
Third Quarter 2010 Results
Total revenues increased 0.2% to
Pollo Tropical revenues increased 8.1% to
Taco Cabana revenues increased 1.1% to
Burger King revenues decreased 4.0% to
General and administrative expenses decreased to
Income from operations decreased to
Interest expense decreased to
Net income in the third quarter of 2010 was
Nine Months Results
For the nine months ended
2010 Outlook
Based upon year-to-date results and expectations for the fourth quarter of 2010, the Company is providing the following updated outlook for the full year:
-
The 2010 fiscal year and the fourth quarter of 2010 have one less week
than 2009, the effect of which is estimated to negatively impact
revenues by approximately
$13.6 million and earnings by$0.07 per diluted share; - Comparable restaurant sales for Pollo Tropical are expected to increase approximately 6%, Taco Cabana comparable restaurant sales are expected to be flat, and Burger King comparable restaurant sales are expected to decrease approximately 3% to 4%;
- Commodity costs are expected to decrease 1% to 2% for Pollo Tropical, to be flat to up 1% for Taco Cabana and to increase 4% to 5% for Burger King;
- For the full year, the Company anticipates the opening of three Hispanic Brand restaurants, as well as the closing of one Pollo Tropical, one Taco Cabana and seven Burger King restaurants (net of one relocation);
- General and administrative expense is expected to decrease 3% to 4% compared to 2009;
-
Total capital expenditures are now expected to be at the lower end of
the Company's
$40 to $45 million estimated range; -
Debt reduction is anticipated to be between
$8 million and $12 million ; and, - The Company's estimated annual effective tax rate is expected to be approximately 37%.
Mr. Vituli concluded, "We were pleased with the performance of our
Hispanic Brands, particularly in light of the slow economic and consumer
recovery. We remain focused on evolving these brands and to further
differentiate them from conventional quick-service restaurants with our
initiatives to enhance guest service models and with the remodeling of
restaurants in certain of our markets. We are encouraged by initial
results and are hopefully laying the groundwork for sustainable
long-term growth as we enter new markets. Finally, given the recent
ownership and leadership changes at
Conference Call Today
The Company will host a conference call to discuss the third quarter
2010 financial results today at
The conference call can be accessed live over the phone by dialing
877-941-8418 or for international callers by dialing 480-629-9809. 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 4378461. The replay will be available
until
Investor Conference Presentation on
The Company will present at the
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 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
| Carrols Restaurant Group, Inc. | ||||||||||||||||||
| Consolidated Statements of Operations | ||||||||||||||||||
| (in thousands except share and per share amounts) | ||||||||||||||||||
| (unaudited) | (unaudited) | |||||||||||||||||
| Three Months Ended | Nine Months Ended | |||||||||||||||||
| September 30, (a) | September 30, (a) | |||||||||||||||||
|
2010 |
2009 |
2010 |
2009 |
|||||||||||||||
| Revenues: | ||||||||||||||||||
| Restaurant sales | $ | 201,272 | $ | 200,802 | $ | 600,080 | 605,326 | |||||||||||
| Franchise royalty revenues and fees | 353 | 364 | 1,165 | 1,117 | ||||||||||||||
| Total revenues | 201,625 | 201,166 | 601,245 | 606,443 | ||||||||||||||
| Costs and expenses: | ||||||||||||||||||
| Cost of sales | 60,093 | 57,662 | 182,260 | 175,284 | ||||||||||||||
| Restaurant wages and related expenses (b) | 59,027 | 59,109 | 177,772 | 176,896 | ||||||||||||||
| Restaurant rent expense | 12,035 | 12,383 | 36,623 | 37,217 | ||||||||||||||
| Other restaurant operating expenses | 29,649 | 29,841 | 86,986 | 88,541 | ||||||||||||||
| Advertising expense | 8,856 | 7,974 | 23,460 | 23,552 | ||||||||||||||
| General and administrative expenses (b) | 12,022 | 12,766 | 37,196 | 38,682 | ||||||||||||||
| Depreciation and amortization | 8,080 | 8,080 | 24,315 | 23,833 | ||||||||||||||
| Impairment and other lease charges | 191 | 46 | 4,092 | 400 | ||||||||||||||
| Other income | (400 | ) | (220 | ) | (400 | ) | (799 | ) | ||||||||||
| Total costs and expenses | 189,553 | 187,641 | 572,304 | 563,606 | ||||||||||||||
| Income from operations | 12,072 | 13,525 | 28,941 | 42,837 | ||||||||||||||
| Interest expense | 4,693 | 4,834 | 14,144 | 14,908 | ||||||||||||||
| Income before income taxes | 7,379 | 8,691 | 14,797 | 27,929 | ||||||||||||||
| Provision for income taxes | 2,786 | 3,094 | 5,455 | 10,241 | ||||||||||||||
| Net income (c) | $ | 4,593 | $ | 5,597 | 9,342 | 17,688 | ||||||||||||
| Basic net income per share | $ | 0.21 | $ | 0.26 | $ | 0.43 | $ | 0.82 | ||||||||||
| Diluted net income per share | $ | 0.21 | $ | 0.26 | $ | 0.43 | $ | 0.81 | ||||||||||
| Basic weighted average common shares outstanding |
21,623 |
21,594 |
21,619 |
21,593 |
||||||||||||||
| Diluted weighted average common shares outstanding |
21,777 |
21,845 |
21,820 |
21,741 |
||||||||||||||
|
(a) |
The Company uses a 52 or 53 week fiscal year that ends on the Sunday closest to December 31. The 2010 fiscal year is a 52 week fiscal period and the 2009 fiscal year was a 53 week fiscal period. For convenience, all references to the three and nine months ended October 3, 2010 and September 27, 2009 are referred to as the three and nine months ended September 30, 2010 and September 30, 2009, respectively. The three and nine months ended September 30, 2010 and 2009 each included 13 and 39 weeks, respectively. |
|||||||||||||||||
|
(b) |
Restaurant wages and related expenses include stock-based compensation expense of $21 and $51 for the three months ended September 30, 2010 and 2009, respectively, and $49 and $156 for the nine months ended September 30, 2010 and 2009, respectively. General and administrative expenses include stock-based compensation expense of $402 and $296 for the three months ended September 30, 2010 and 2009, respectively, and $1,183 and $899 for the nine months ended September 30, 2010 and 2009, respectively. |
|||||||||||||||||
|
(c) |
The consolidated financial results for Carrols Corporation, the sole operating subsidiary of Carrols Restaurant Group, Inc., differ from the above by a slight difference in rent expense. Consolidated net income for Carrols Corporation for the three months ended September 30, 2010 and 2009 was $4,595 and $5,599, respectively, and $9,347 and $17,693 for the nine months ended September 30, 2010 and 2009, respectively. |
|||||||||||||||||
|
Carrols Restaurant Group, Inc. |
|||||||||||||||||
|
The following table sets forth certain unaudited supplemental financial and other restaurant data for the periods indicated (in thousands, except number of restaurants): |
|||||||||||||||||
| (unaudited) | (unaudited) | ||||||||||||||||
| Three Months Ended | Nine Months Ended | ||||||||||||||||
| September 30, | September 30, | ||||||||||||||||
|
2010 |
2009 |
2010 |
2009 |
||||||||||||||
| Segment revenues: | |||||||||||||||||
| Burger King | $ | 90,356 | $ | 94,132 | $ | 271,431 | $ | 284,163 | |||||||||
| Pollo Tropical | 47,567 | 44,021 | 139,873 | 132,737 | |||||||||||||
| Taco Cabana | 63,702 | 63,013 | 189,941 | 189,543 | |||||||||||||
| Total revenues | $ | 201,625 | $ | 201,166 | $ | 601,245 | $ | 606,443 | |||||||||
| Change in comparable restaurant sales: (a) | |||||||||||||||||
| Burger King | (3.2 | )% | (6.1 | )% | (3.7 | )% | (2.3 | )% | |||||||||
| Pollo Tropical | 8.8 | % | (0.1 | )% | 6.3 | % | (2.0 | )% | |||||||||
| Taco Cabana | 1.0 | % | (4.3 | )% | (0.3 | )% | (3.4 | )% | |||||||||
| Adjusted Segment EBITDA: (b) | |||||||||||||||||
| Burger King | $ | 6,394 | $ | 8,822 | $ | 15,702 | $ | 24,894 | |||||||||
| Pollo Tropical | 7,489 | 6,294 | 22,361 | 19,526 | |||||||||||||
| Taco Cabana | 6,483 | 6,662 | 20,117 | 22,906 | |||||||||||||
| Average sales per restaurant: (c) | |||||||||||||||||
| Burger King | $ | 295 | $ | 302 | $ | 879 | $ | 907 | |||||||||
| Pollo Tropical | 526 | 481 | 1,538 | 1,452 | |||||||||||||
| Taco Cabana | 409 | 406 | 1,219 | 1,227 | |||||||||||||
| New restaurant openings: | |||||||||||||||||
| Burger King | - | - | 1 | 1 | |||||||||||||
| Pollo Tropical | - | - | - | 1 | |||||||||||||
| Taco Cabana | 1 | 1 | 1 | 3 | |||||||||||||
| Total new restaurant openings | 1 | 1 | 2 | 5 | |||||||||||||
| Restaurant closings: | |||||||||||||||||
| Burger King | (3 | ) | - | (7 | ) | (2 | ) | ||||||||||
| Pollo Tropical | - | - | (1 | ) | (1 | ) | |||||||||||
| Taco Cabana | - | - | (1 | ) | (2 | ) | |||||||||||
| Net new restaurants | (2 | ) | 1 | (7 | ) | - | |||||||||||
| Number of company owned restaurants: | |||||||||||||||||
| Burger King | 306 | 314 | |||||||||||||||
| Pollo Tropical | 90 | 91 | |||||||||||||||
| Taco Cabana | 156 | 155 | |||||||||||||||
| Total company owned restaurants | 552 | 560 | |||||||||||||||
| At 9/30/10 | At 12/31/09 | ||||||||||||||||
| Long-term debt (d) | $ | 275,532 | $ | 283,092 | |||||||||||||
|
(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 loss (income) and gains and 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 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. |
||||||||||||||||
|
(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 October 3, 2010 included $165,000 of the Company's 9% senior subordinated notes, $99,265 of outstanding borrowings under its senior credit facility, $10,046 of lease financing obligations and $1,221 of capital lease obligations. Long-term debt at January 3, 2010 (including current portion) included $165,000 of the Company's 9% senior subordinated notes, $106,900 of outstanding borrowings under its senior credit facility, $9,999 of lease financing obligations and $1,193 of capital lease obligations. |
||||||||||||||||
Investor Relations:
800-348-1074,
ext. 3333
Source:
News Provided by Acquire Media