Bravo Brio Restaurant Group, Inc. Reports Third Quarter & Year-to-Date 2012 Financial Results Updates Fiscal 2012 Outlook; Provides Preliminary View of Fiscal 2013; Board of Directors Authorizes $20 Million Share Repurchase Program COLUMBUS, Ohio, Oct. 23, 2012 (GLOBE NEWSWIRE) -- Bravo Brio Restaurant Group, Inc. (Nasdaq:BBRG), owner and operator of the BRAVO! Cucina Italiana (BRAVO!) and BRIO Tuscan Grille (BRIO) restaurant concepts, today reported financial results for the thirteen and thirty-nine week periods ended September 23, 2012, updated its fiscal 2012 outlook, as well as provided a preliminary view of fiscal 2013. The Company has also announced that its Board of Directors has authorized a $20 million share repurchase program. Selected Third Quarter of 2012 Highlights Compared to the Year-Ago Period Include the Following: *Revenues increased 8.1% to $95.9 million from $88.8 million. *Total comparable restaurant sales decreased 0.9%. *Comparable restaurant sales decreased 0.5% at BRAVO! and 1.1% at BRIO. *Restaurant-level operating profit increased 7.7% to $16.0 million from $14.9 million. *GAAP net income was $2.8 million, or $0.14 per diluted share, compared to GAAP net income of $3.6 million, or $0.18 per diluted share and modified pro forma net income of $2.6 million, or $0.13 per diluted share, in 2011. Please see the reconciliation from GAAP to modified pro forma (non-GAAP) net income in the accompanying financial tables. Selected Year-to-Date 2012 Highlights Compared to the Year-Ago Period Include the Following: *Revenues increased 8.6% to $297.1 million from $273.6 million. *Total comparable restaurant sales decreased 0.2%. *Comparable restaurant sales decreased 0.1% at BRAVO! and 0.2% at BRIO. *Restaurant-level operating profit increased 8.9% to $51.8 million from $47.6 million. *GAAP net income was $11.7 million, or $0.57 per diluted share, compared to GAAP net income of $71.5 million, or $3.48 per diluted share and modified pro forma net income of $10.7 million, or $0.52 per diluted share, in 2011.Please see the reconciliation from GAAP to modified pro forma (non-GAAP) net income in the accompanying financial tables. *The $59.8 million decrease in GAAP net income was primarily due to a $57.2 million income tax benefit recorded in the second quarter of 2011 related to a reduction of a valuation allowance against net deferred tax assets. "During the third quarter we improved earnings despite difficult comparisonsandmodestsales deleveraging.While the macroeconomic environment remains challenging, our focus continues to be on driving traffic by exceeding our guests' expectations each and every day," said Saed Mohseni, Chief Executive Officer and President. Mohseni continued, "Our fourth quarterinitiativesinclude executing on ourrecently launchedguest loyaltyprogram,rolling outnew menusfocused on culinary excellenceandvalue driven price points, gearing up for the Holiday season with an emphasisonourbanquet business,andpromoting gift cards withinourrestaurants and through third party distributors." "Our Board of Directorshas recently approved a $20 million share repurchase programasa clear demonstration of our confidence in the future of this Company. Our intention is to continue to allocate capital smartly and efficiently, andweareexcitedtohave an additional lever at our disposal to enhance longer term value," Mohseni concluded. Third Quarter 2012 Financial Results Revenues increased approximately $7.1 million, or 8.1%, to $95.9 million in the third quarter of 2012, from $88.8 million in the third quarter of 2011.The increase in revenues was primarily due to an additional 116 operating weeks provided by seven restaurants, six BRIOs and one BRAVO!, opened in the first thirty-nine weeks of 2012 and six restaurants opened in the second half of 2011.Total comparable restaurant sales decreased 0.9%, as a 3.4% decrease in guest counts was partially offset by a $0.59 increase in average check. Total restaurant operating costs increased $6.0 million, or 8.1%, to $79.9 million in the third quarter of 2012, from $73.9 million in the third quarter of 2011.Total restaurant-level operating costs include costs of sales, labor costs, operating costs and occupancy costs.Total restaurant-level operating profit, which consists of revenues minus total restaurant-level operating costs, increased $1.1 million, or 7.7%, to $16.0 million from $14.9 million in the same period last year.As a percentage of revenues, total restaurant-level operating profit decreased to 16.7% in the third quarter of 2012 from 16.8% in the third quarter of 2011.This was primarily attributable to an increase in labor costs that were partially offset by a decrease in cost of sales in 2012 as compared to 2011. GAAP net income for the third quarter of 2012 was $2.8 million, or $0.14 per diluted share, compared to GAAP net income of $3.6 million, or $0.18 per diluted share, in the same period last year. On a modified pro forma basis, a measure that management believes offers a more useful year-over-year performance comparison, there were no adjustments from GAAP net income for the third quarter of 2012 and net income was $2.8 million, or $0.14 per diluted share.This compared to modified pro forma net income of $2.6 million, or $0.13 per diluted share, in the same period last year.Please see the accompanying financial tables for a reconciliation from GAAP net income to modified pro forma (non-GAAP) net income. Third Quarter 2012 Brand Operating Highlights Comparable restaurant sales at BRAVO! decreased 0.5% and average weekly sales were $63,600.Comparable restaurant sales at BRIO decreased 1.1% in the third quarter of 2012 and average weekly sales were $91,200. As of September 23, 2012, the Company operated 48 BRAVO!, 52 BRIO, and one Bon Vie restaurant across 31 states.Included in this total is one BRIO restaurant that is operated under a management agreement. Outlook Based upon the year-to-date results as of September 23, 2012, and projections for the fourth quarter of 2012, the Company is updating its fiscal 2012 financial forecast as follows: *Revenues of $410 million to $413 million. *Flat total annual comparable restaurant sales. *Development of ten restaurants, including one restaurant operated under a management agreement. *Pre-opening costs of $4.9 million to $5.3 million. *Diluted earnings per share of $0.89 to $0.92. *Capital expenditures of $25 million to $27 million. *Diluted share count of approximately 20.7 million. *Annual effective tax rate of approximately 29.0%. The Company is also providing a preliminary view of fiscal 2013, which is a 52-week year. Revenues are expected in the $430 million to $440 million range based on comparable restaurant sales of zero to positive 1.0%. The Company also anticipates developing seven to eight new restaurants. Stock Repurchase Program On October 17, 2012, the Board of Directors approved the terms of a share repurchase plan, under which the Company is authorized to repurchase up to $20 million of its common shares beginning October 26, 2012 and ending on December 29, 2013, subject to the Company's pre-existing blackout periods.The Company may repurchase shares on the open market or through privately negotiated transactions at times and prices considered appropriate by the Company at the discretion of management and subject to its assessment of market conditions and other economic factors. Investor Conference Call and Webcast The Company will host an investor conference call to discuss third quarter 2012 financial results today at 5:00 PM ET. Hosting the call will be Saed Mohseni, Chief Executive Officer, Jim O'Connor, Chief Financial Officer and Brian O'Malley, Chief Operating Officer. The conference call can be accessed live over the phone by dialing (888) 401-4691, or for international callers (719) 325-2333. A replay will be available one hour after the call and can be accessed by dialing (877) 870-5176 or (858) 384-5517 for international callers; the conference ID is 7349616. The replay will be available until Tuesday, October 30, 2012. The call will be webcast live from the Company's investor relations website at http://investors.bbrg.com. About Bravo Brio Restaurant Group, Inc. Bravo Brio Restaurant Group, Inc. is a leading owner and operator of two distinct Italian restaurant brands, BRAVO! Cucina Italiana and BRIO Tuscan Grille. BBRG has positioned its brands as multifaceted culinary destinations that deliver the ambiance, design elements and food quality reminiscent of fine dining restaurants at a value typically offered by casual dining establishments, a combination known as the upscale affordable dining segment. Each of BBRG's brands provides its guests with a fine dining experience and value by serving affordable cuisine prepared using fresh flavorful ingredients and authentic Italian cooking methods, combined with attentive service in an attractive, lively atmosphere. BBRG strives to be the best Italian restaurant company in America and is focused on providing its guests an excellent dining experience through consistency of execution. Forward-Looking Statements Some of the statements in this release contain forward-looking statements, which involve risks and uncertainties. These statements relate to future events or our future financial performance. We have attempted to identify forward-looking statements by terminology including "anticipates," "believes," "can," "continue," "could," "estimates," "expects," "intends," "may," "plans," "potential," "predicts," "should" or "will" or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties, and other factors, including those discussed under the heading "Risk Factors" in our Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 6, 2012. Although we believe that the expectations reflected in the forward-looking statements are reasonable based on our current knowledge of our business and operations, we cannot guarantee future results, levels of activity, performance or achievements. We assume no obligation to provide revisions to any forward-looking statements should circumstances change. BRAVO BRIO RESTAURANT GROUP, INC. AND SUBSIDIARIES Consolidated Statements of Operations GAAP Presentation with Reconciliation to Modified Pro Forma Thirteen and Thirty-Nine Weeks Ended September 23, 2012 and September 25, 2011 (Unaudited) (Dollars in thousands, except per share data) Thirteen Thirteen Thirty-Nine Thirty-Nine Weeks Weeks Weeks Weeks Ended Ended Ended Ended September September September September 23, 25, 23, 25, 2012 2011 2012 2011 Revenues $95,921 $88,774 $297,105 $273,592 Costs and expenses Cost of sales 25,045 26.1% 23,617 26.6% 77,164 26.0% 73,008 26.7% Labor 33,528 35.0% 30,730 34.6% 102,950 34.7% 92,893 34.0% Operating 15,089 15.7% 13,958 15.7% 45,752 15.4% 42,388 15.5% Occupancy 6,230 6.5% 5,587 6.3% 19,448 6.5% 17,747 6.5% General and administrative 5,700 5.9% 5,185 5.8% 17,085 5.8% 16,067 5.9% expenses Restaurant 1,442 1.5% 1,281 1.4% 3,615 1.2% 2,882 1.1% preopening costs Depreciation and 4,689 4.9% 4,303 4.8% 13,765 4.6% 12,555 4.6% amortization Total costs and 91,723 95.6% 84,661 95.4% 279,779 94.2% 257,540 94.1% expenses Income from 4,198 4.4% 4,113 4.6% 17,326 5.8% 16,052 5.9% operations Net interest 322 0.3% 394 0.4% 1,008 0.3% 1,315 0.5% expense Income before 3,876 4.0% 3,719 4.2% 16,318 5.5% 14,737 5.4% income taxes Income tax 1,049 1.1% 121 0.1% 4,612 1.6% (56,806) -20.8% (benefit) expense Net income 2,827 2.9% 3,598 4.1% 11,706 3.9% 71,543 26.1% Net income per $0.14 $0.19 $0.60 $3.71 basic share Net income per $0.14 $0.18 $0.57 $3.48 diluted share Weighted average shares 19,618 19,330 19,558 19,286 outstanding-basic Weighted average shares 20,649 20,551 20,617 20,545 outstanding-diluted Certain percentage amounts may not sum due to rounding. ADJUSTMENTS TO RECONCILE GAAP TO MODIFIED PRO FORMA RESULTS Income Tax Expense -- (995) -- (4,232) (1) Reduction in Valuation Allowance -- -- -- (57,175) (2) Secondary Offering -- -- -- 600 Costs (3) Total Adjustments -- (995) -- (60,807) Modified Pro Forma $2,827 $2,603 $11,706 $10,736 Net Income Net income per basic share-pro $0.14 $0.13 $0.60 $0.56 forma Net income per diluted share- pro $0.14 $0.13 $0.57 $0.52 forma Weighted average shares 19,618 19,330 19,558 19,286 outstanding-basic Weighted average shares 20,649 20,551 20,617 20,545 outstanding-diluted Notes to adjustments shown above: 1. This adjustment reflects a tax rate of 30.0%, which reflects our estimate of our long-term effective tax rate. 2. This adjustment reflects the reduction of a significant portion of our valuation allowance in the second quarter of 2011 as it was deemed more likely than not that the Company would utilize its future net deferred tax assets. 3. Reflects the non-recurring costs, incurred by us, associated with the secondary offering of our common shares by certain of the Company's existing shareholders, completed on April 1, 2011.We did not receive any proceeds from the offering. BRAVO BRIO RESTAURANT GROUP, INC. AND SUBSIDIARIES Consolidated Balance Sheets As of September 23, 2012 and December 25, 2011 (Dollars in thousands) September 23, December 25, 2012 2011 Assets (Unaudited) Current assets Cash and cash equivalents $7,919 $10,093 Accounts receivable 5,829 6,403 Tenant improvement allowance receivable 3,003 1,219 Inventories 2,587 2,767 Deferred income taxes, net 3,354 2,328 Prepaid expenses and other current assets 1,694 2,367 Total current assets 24,386 25,177 Property and equipment, net 177,185 163,208 Deferred income taxes, net 51,825 55,811 Other assets, net 4,287 3,430 Total assets $257,683 $247,626 Liabilities and stockholders' equity Current liabilities Trade and construction payables $13,498 $13,058 Accrued expenses 23,295 20,183 Current portion of long-term debt 2,366 1,714 Deferred lease incentives 6,122 5,639 Deferred gift card revenue 6,911 10,863 Total current liabilities 52,192 51,457 Deferred lease incentives 65,081 62,565 Long-term debt 21,058 30,857 Other long-term liabilities 20,774 18,163 Commitments and contingencies Stockholders' equity Common shares, no par value per share - authorized, 100,000,000 shares; issued and 195,322 193,034 outstanding, 19,684,284 atSeptember 23, 2012 and19,476,559 at December 25, 2011 Preferred shares, no par value, per share - authorized, 5,000,000 shares; issued and -- -- outstanding, 0 shares at September 23, 2012 and December 25, 2011 Retained deficit (96,744) (108,450) Total stockholders' equity 98,578 84,584 Total liabilities and stockholders' equity $257,683 $247,626 CONTACT: Investor Relations Don Duffy/Raphael Gross (203) 682-8200/ (203) 682-8253 firstname.lastname@example.org
Bravo Brio Restaurant Group, Inc. Reports Third Quarter & Year-to-Date 2012 Financial Results
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