Famous Dave's Reports Results For Fiscal 2013 Restaurant Level Cash Flow Margins Increased 250 Basis Points Diluted Earnings Per Share Improved 9% Adjusted Net Income Per Share Increased 37% EBITDA Improves 14% MINNEAPOLIS, Feb. 12, 2014 (GLOBE NEWSWIRE) -- Famous Dave's of America, Inc. (Nasdaq:DAVE) today reported financial results for the fourth quarter and fiscal year ending December 29, 2013. Highlights for the fourth quarter of 2013 as compared to the fourth quarter of 2012: *Revenue decreased to $35.7 million from $36.3 million, reflecting a comparable sales decrease and lower franchise fee revenue. *Comparable sales for Company-owned restaurants open 24 months or more decreased 2.6%, compared to a decrease of 6.0% for the comparable quarter in the prior year. *Franchise royalty revenue of $4.0 million was slightly favorable to the prior year, reflecting revenue contribution from a net five new franchise restaurants, partially offset by a comparable sales decrease of 1.1%. *Restaurant level cash flow margins increased 160 basis points, reflecting year over year improvements in food & beverage costs and restaurant operating expenses. *Net income was $1.9 million, reflecting significant operational improvements. This compared to $750,000 for the fourth quarter of 2012. *Diluted net income per share was $0.25 compared to $0.10 in the fourth quarter of 2012. Earnings for the fourth quarter of 2012 were favorably impacted by a tax rate adjustment for employment tax credits equal to approximately $0.03 per diluted share. *Diluted adjusted net income per share was $0.25 compared to $0.07 for the fourth quarter of 2012. *Adjusted EBITDA for the fourth quarter of 2013 was $4.6 million compared to $2.4 million for the fourth quarter of 2012. Highlights for fiscal 2013 as compared to fiscal 2012: *Revenue of $155.4 million increased approximately $444,000, reflecting an increase in restaurant sales, partially offset by a decline in franchise royalty revenue and fees. *Comparable sales for Company-owned restaurants open 24 months or more were 0.2% positive compared to a decrease of 1.8% in 2012. *Franchise royalty revenue was $17.1 million, compared to $17.4 million, reflecting a franchise comparable sales decrease of 2.9%, partially offset by revenue generated from a net five new franchise restaurants. *Restaurant level cash flow margins increased 250 basis points, reflecting year over year improvement in all operating line items. *Cash flows provided by operations were $15.6 million for fiscal 2013, compared to $9.6 million for fiscal 2012. *Net income was $4.8 million compared to $4.4 million, reflecting improvements in restaurant level operations and lower G&A, partially offset by $1.2 million, or $0.11 per diluted share, for the non-cash asset impairment of a Maryland restaurant, a lease restructuring at a Virginia restaurant and residual closing costs for a Maryland restaurant that was relocated during 2013. *Diluted net income per share was $0.62 compared to $0.57, for 2012. *Diluted adjusted net income per share was $0.74, compared to $0.54 for fiscal 2012, reflecting the year-over-year impact from the non-cash charges and the favorable tax rate adjustment for employment tax credits for 2012. *Adjusted EBITDA was approximately $15.1 million for fiscal 2013, compared to approximately $12.6 million for fiscal 2012. *The Company paid down $3.1 million of debt since the end of fiscal 2012. *The Company used approximately $6.9 million to repurchase approximately 379,000 shares at an average price of $18.22, excluding commissions. Dean Riesen, Chairman of the Company's board of directors, commented, "While we were disappointed with our sales performance this quarter, we made great strides on a number of initiatives this year, including improved unit level economics and reduced overhead that should benefit us for the long-term." Development Famous Dave's opened 2 franchise-operated restaurants in Williston, North Dakota and Oxnard, California as well as 1 company-owned restaurant in Timonium, Maryland during the fourth quarter. Famous Dave's ended the quarter with 194 restaurants, including 54 company-owned restaurants and 140 franchise-operated restaurants, located in 34 states, the Commonwealth of Puerto Rico, and 1 Canadian province. The company expects to open 1 company-owned restaurant, as well as 6 franchise-operated restaurants during fiscal 2014. Outlook "Unfortunately, as a result of severe weather patterns impacting essentially all of our markets, sales to date have been softer than expected," said Riesen. "We have a number of strategies going into BBQ season however, that should prove effective towards building sales." Conference Call The company will host a conference call, February 13, 2014, at 10:00 a.m. Central Time to discuss its fourth quarter financial results. There will be a live webcast of the discussion through the Investor Relations section of Famous Dave's web site at www.famousdaves.com. About Famous Dave's Famous Dave's of America, Inc. develops, owns, operates and franchises barbeque restaurants. As of today, the company owns 54 locations and franchises 142 additional units in 34 states, the Commonwealth of Puerto Rico, and 1 Canadian province. Its menu features award-winning barbequed and grilled meats, an ample selection of salads, side items and sandwiches, and unique made-from-scratch desserts. Use of Non-GAAP Financial Measures To supplement its financial statements, Famous Dave's of America, Inc. also provides investors with adjusted net income per share and adjusted EBITDA which are non-GAAP financial measures. The Company believes that these non-GAAP measures provide useful information to management and investors regarding certain financial and business trends relating to its financial condition and results of operations. Famous Dave's management uses these non-GAAP measures to compare the Company's performance to that of prior periods for trend analysis and planning purposes. Adjusted net income per share consists of net income plus non-cash items, such as, asset impairment and estimated lease termination and other closing costs and net loss on disposal of equipment divided by the weighted average number of shares of common stock outstanding during each period presented. Famous Dave's of America, Inc. believes adjusted net income per share is useful to an investor because it is widely used to measure a company's operating performance. EBITDA consists of income from operations plus depreciation and amortization. Adjusted EBITDA consists of EBITDA plus non-cash items, such as, asset impairment and estimated lease termination and other closing costs and net loss on disposal of equipment.Famous Dave's uses Adjusted EBITDA as a measure of operating performance because it assists the Company in comparing performance on a consistent basis, as it removes from operating results the impact of non-cash events. The Company believes Adjusted EBITDA is useful to an investor in evaluating the company's operating performance because it is widely used to measure a Company's operating performance without the impact of items such as depreciation and amortization, which can vary depending upon accounting methods and the book value of assets, and to present a meaningful measure of corporate performance exclusive of the impact of non-cash events and the method by which assets were acquired. These non-GAAP measures should not be considered a substitute for, or superior to, financial measures calculated in accordance with generally accepted accounting principles in the United States.These non-GAAP financial measures exclude significant expenses and income that are required by GAAP to be recorded in the company's financial statements and are subject to inherent limitations. Famous Dave's of America, Inc. urges investors to review the reconciliation of its non-GAAP financial measures to the comparable GAAP financial measures that are included in this press release.The tables appearing at the end of this release provide reconciliations of net income to adjusted net income per share and Adjusted EBITDA. FAMOUS DAVE'S OF AMERICA, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS DECEMBER 29, 2013 AND DECEMBER 30, 2012 (in thousands, except share and per share data) (Unaudited) Three Months Ended Twelve Months Ended December 29, December 30, December 29, December 30, 2013 2012 2013 2012 Revenue: Restaurant sales, net $31,424 $31,792 $136,930 $135,730 Franchise royalty revenue 4,042 3,999 17,104 17,354 Franchise fee revenue 23 190 282 730 Licensing and other 232 274 1,116 1,174 revenue Total revenue 35,721 36,255 155,432 154,988 Costs and expenses: Food and beverage costs 9,421 10,012 41,431 42,431 Labor and benefits costs 10,685 10,598 44,335 44,257 Operating expenses 7,908 8,258 34,995 36,505 Depreciation and 1,581 1,552 6,160 6,000 amortization General and administrative 2,862 4,786 18,903 18,708 expenses Asset impairment and estimated lease 15 82 1,181 370 termination and other closing costs Pre-opening expenses 277 157 646 474 Net loss on disposal of 26 13 34 30 property Total costs and expenses 32,775 35,458 147,685 148,775 Income from operations 2,946 797 7,747 6,213 Other expense: Interest expense (226) (257) (997) (1,050) Interest income 1 2 7 7 Other income (expense), 30 (12) 20 (5) net Total other expense (195) (267) (970) (1,048) Income before income taxes 2,751 530 6,777 5,165 Income tax (expense) (879) 220 (2,010) (805) benefit Net income $1,872 $750 $4,767 $4,360 Basic net income per $0.26 $0.10 $0.65 $0.58 common share Diluted net income per $0.25 $0.10 $0.62 $0.57 common share Weighted average common 7,232 7,338 7,367 7,455 shares outstanding basic Weighted average common 7,485 7,547 7,648 7,650 shares outstanding diluted FAMOUS DAVE'S OF AMERICA, INC. AND SUBSIDIARIES OPERATING RESULTS (unaudited) Three Months Ended Twelve Months Ended December 29, December 30, December 29, December 30, 2013 2012 2013 2012 Food and beverage costs^(1) 30.0% 31.5% 30.3% 31.3% Labor and benefits^(1) 34.0% 33.3% 32.4% 32.6% Operating expenses^(1)(3) 25.2% 26.0% 25.6% 26.9% Restaurant level cash flow 10.8% 9.2% 11.7% 9.2% margins^(1)(5) Depreciation & amortization 4.4% 4.4% 4.0% 4.0% (restaurant level)^(1) Asset impairment and estimated lease termination ------ 0.3% 0.9% 0.3% and other closing costs^(1) Pre-opening expenses andnet loss on disposal of 1.0% 0.5% 0.5% 0.4% equipment^(1) Costs and expenses 94.6% 96.0% 93.7% 95.5% (restaurant level)^(1) Restaurant level 5.4% 4.0% 6.3% 4.5% margin^(1)(4) Depreciation & amortization 0.6% 0.5% 0.5% 0.4% (corporate level)^(2) General and 8.0% 13.2% 12.2% 12.1% administrative^(2)(3) Total costs and expenses^(2) 91.8% 97.8% 95.0% 96.0% Income from operations^(2) 8.2% 2.2% 5.0% 4.0% ^(1)As a percentage of restaurant sales, net^ ^(2)As a percentage of total revenue ^(3) In order to be consistent with what the Company believes to be a more prevalent practice among other public restaurant companies, the Company has decided to reflect multi-unit supervision expenses within general and administrative expenses, rather than as operating expenses, where they previously have been reflected. For the fourth quarter of fiscal 2012, this adjustment was approximately $461,000.For the fiscal year ended 2012, this adjustment was approximately $1,859,000. ^(4)Restaurant level margin is equal to taking restaurant sales, net less restaurant level costs and expenses.Restaurant level costs and expenses include food and beverage costs, labor and benefit costs, operating expenses, restaurant level depreciation and amortization, asset impairment and estimated lease termination and other closing costs, pre-opening expenses and net loss on disposal of equipment. ^(5)Restaurant level cash flow margins are equal to taking restaurant sales, net less restaurant level food and beverage costs, labor and benefit costs, and operating expenses. FAMOUS DAVE'S OF AMERICA, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands) (unaudited) December 29, December 30, 2013 2012 ASSETS Cash and cash equivalents $1,293 $2,074 Other current assets 10,764 10,272 Property, equipment and leasehold improvements, net 59,733 60,429 Other assets 3,547 3,478 Total assets $75,337 $76,253 LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities $14,391 $12,117 Line of credit 11,400 13,600 Other long-term obligations 16,755 16,769 Shareholders' equity 32,791 33,767 Total liabilities and shareholders' equity $75,337 $76,253 FAMOUS DAVE'S OF AMERICA, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands) (unaudited) Twelve Months Ended December 29, December 30, 2013 2012 Cash flows provided by operating activities $15,600 $9,626 Cash flows used for investing activities (6,813) (5,473) Cash flows used for financing activities (9,568) (3,227) Net (decrease) increase in cash and cash equivalents $(781) $926 SUPPLEMENTAL SALES INFORMATION (unaudited) Three Months Ended Twelve Months Ended December 29, December 30, December 29, December 30, 2013 2012 2013 2012 ^ ^ ^ ^ Restaurant sales (in thousands): Company-Owned $31,424 $31,792 $136,930 $135,730 Franchise-Operated $85,462 $82,614 $363,438 $361,109 Total number of restaurants: Company-Owned 54 53 54 53 Franchise-Operated 140 135 140 135 Total 194 188 194 188 Total weighted average weekly net sales (AWS): Company-Owned $45,084 $46,009 $49,514 $49,172 Franchise-Operated $48,093 $48,100 $52,136 $52,714 Operating weeks: Company-Owned 697 691 2,762 2,754 Franchise-Operated 1,777 1,717 6,971 6,848 Weighted comparable net sales by category (24 month): Dine-in (3.8)% (5.5)% (1.9)% (2.1)% To Go 2.8% (1.2)% 2.6% 0.0% Catering (1.6)% 0.7% (0.6)% 0.3% Total company-owned (2.6)% (6.0)% 0.2% (1.8)% comparable sales % Franchise-Operated % (1.1)% (4.0)% (2.9)% (2.0)% Total number of comparable restaurants: Company-Owned 49 50 48 49 Franchise-Operated 119 112 114 107 FAMOUS DAVE'S OF AMERICA, INC. NON-GAAP RECONCILIATION (in thousands, except share and per share data) (unaudited) Three Months Ended Twelve Months Ended December 29, December 30, December 29, December 30, 2013 2012 2013 2012 Net income $1,872 $750 $4,767 $4,360 Asset impairment and estimated lease 15 82 1,181 370 termination and other closing costs Net loss on disposal of 26 13 34 30 equipment Tax adjustment for (13) (39) (360) (62) non-cash adjustments Tax rate adjustments for -- (261) -- (559) employment tax credits Adjusted net income $1,900 $545 $5,622 $4,139 Non-GAAP adjusted income per share: Basic adjusted net $0.26 $0.07 $0.76 $0.56 income per common share Diluted adjusted net $0.25 $0.07 $0.74 $0.54 income per common share Shares used to compute Non-GAAP income per share: Weighted average common share outstanding - $7,232 $7,338 $7,367 $7,455 basic Weighted average common share outstanding - $7,485 $7,547 $7,648 $7,650 diluted Income from operations $2,946 $797 $7,747 $6,213 Depreciation and 1,581 1,552 6,160 6,000 amortization EBITDA 4,527 2,349 13,907 12,213 Non-cash items: Asset impairment and estimated lease 15 82 1,181 370 termination and other closing costs Net loss on disposal of 26 13 34 30 equipment Adjusted EBITDA $4,568 $2,444 $15,122 $12,613 Statements in this press release that are not strictly historical, including but not limited to statements regarding the timing of our restaurant openings and the timing or success of our expansion plans, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.These forward-looking statements involve known and unknown risks, which may cause the company's actual results to differ materially from expected results.Although Famous Dave's of America, Inc. believes the expectations reflected in any forward-looking statements are based on reasonable assumptions, it can give no assurance that its expectation will be attained.Factors that could cause actual results to differ materially from Famous Dave's expectation include financial performance, restaurant industry conditions, execution of restaurant development and construction programs, franchisee performance, changes in local or national economic conditions, availability of financing, governmental approvals and other risks detailed from time to time in the company's SEC reports. CONTACT: Diana G. Purcel - Chief Financial Officer 952-294-1300 Famous Dave's of America Logo
Famous Dave's Reports Results For Fiscal 2013
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