SZ Worldwide Restaurant Concepts

HIGHLIGHTS: SHERMAN OAKS, Calif., Sept. 16 /PRNewswire-FirstCall/ -- Worldwide Restaurant Concepts, Inc. (NYSE:SZ) today reported financial results for the first quarter ended July 24, 2005. The Company reported revenues of $86.3 million for the first quarter of fiscal 2006, an increase of 5.3 percent from the $82.0 million reported in the prior year period. Net income for the 2006 first quarter was $1.9 million, or $0.06 per diluted share, compared to net income of $0.5 million, or $0.02 per diluted share, in the same period a year ago. The strengthening of the Australian dollar compared to last year contributed $4.1 million to 2006 first quarter revenue and $0.3 million to net income. Merger Transaction Continues to Move Forward. Special Meeting Announced. On August 22, 2005, the Company announced a special meeting, on September 21, 2005, to consider and vote upon the proposed merger between affiliates of Pacific Equity Partners and Worldwide Restaurant Concepts. The Company and Pacific Equity Partners continue to finalize the steps necessary to completing the merger transaction. "Our first quarter restaurant operations continued the strong momentum of the fourth quarter," commented Chuck Boppell, President and CEO of Worldwide Restaurant Concepts. "Sizzler USA ended the quarter with strong results thanks to two successful promotions: Steak and Lobster, as well as, the Ultimate Sizzlin' Trio; Pat & Oscar's continues to focus on recovering its momentum after the food-borne illness incident of last year, and our Australian subsidiary continues to deliver solid results. We are happy with all our divisions this quarter," continued Mr. Boppell. "Additionally, the merger transaction is moving ahead as planned. We have mailed our proxy and have announced the special meeting in September," added Mr. Boppell. Rob Koczkar, Managing Director of Pacific Equity Partners, echoed Mr. Boppell's comments. "We are pleased that the shareholders will soon be able to vote on this merger and look forward to finalizing this transaction by the end of September," added Mr. Koczkar. About Worldwide Restaurant Concepts Worldwide Restaurant Concepts, Inc. operates, franchises or joint ventures 310 Sizzler(R) restaurants worldwide, 112 KFC(R) restaurants located primarily in Queensland, Australia, and 21 Pat & Oscar's(R) restaurants. Additional information about the Company can be found at http://www.wrconcepts.com/. Certain statements contained in this document may contain forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements may include but are not limited to statements regarding: (i) improving revenues and earnings; and (ii) completion of the pending merger transaction. Worldwide Restaurant Concepts cautions that these statements are qualified by important factors that could cause actual results to differ materially from those reflected in the forward looking statements contained herein. Such factors include, but are not limited to: (a) the Company's ability to complete the proposed merger transaction; (b) economic conditions, both generally and as they affect the restaurant industry in particular; and (c) other risks as detailed from time to time in the Company's SEC reports, including Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and Annual Reports on Form 10-K. AT THE COMPANY: Keith Wall Liz Baskerville Vice President and CFO Director, Planning (818) 662-9800 (818) 662-9800 AT Financial Relations Board: Laurie Berman Tricia Ross General Information Investor/Analyst Contact (310) 854-8315 (617) 520-7064 [tables to follow] WORLDWIDE RESTAURANT CONCEPTS, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF INCOME FOR THE TWELVE WEEKS ENDED JULY 24, 2005 AND JULY 25, 2004 (Unaudited) (In thousands, except per share data) July 24, July 25, 2005 2004 Revenues Restaurant sales, net $84,038 $79,874 Franchise revenues 2,292 2,078 Total revenues 86,330 81,952 Costs, expenses and other Cost of sales (excluding depreciation and amortization reflected below) 28,768 27,618 Labor and related expenses 22,077 21,596 Other operating expenses 20,006 20,153 Depreciation and amortization 2,799 2,805 General and administrative expenses 8,184 7,077 Total operating costs, expenses and other 81,834 79,249 Operating income 4,496 2,703 Interest expense 292 734 Investment income, net 186 124 Income before income taxes and minority interest 4,390 2,093 Provision for income taxes 1,822 1,164 Minority interest expense 708 440 Net income $1,860 $489 Basic earnings per share $0.07 $0.02 Diluted earnings per share $0.06 $0.02 WORLDWIDE RESTAURANT CONCEPTS, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (in thousands) July 24, April 30, ASSETS 2005 2005 Current Assets: Cash and cash equivalents $36,232 $34,379 Restricted cash 5,341 5,330 Receivables, net of an allowance of $451 at July 24, 2005 and $437 at April 30, 2005 3,933 2,760 Inventories 5,477 5,670 Deferred income taxes 5,485 5,485 Prepaid expenses and other current assets 3,522 4,371 Assets related to restaurants held for sale 2,232 2,232 Total current assets 62,222 60,227 Property and equipment, net 67,190 68,729 Long-term notes receivable, net (including $151 related party receivables at July 24, 2005 and $160 at April 30, 2005) 1,426 1,460 Deferred income taxes 6,971 7,192 Goodwill 1,723 1,723 Intangible assets, net of accumulated amortization of $1,354 at July 24, 2005 and $1,322 at April 30, 2005 2,223 2,278 Other assets 536 925 Total assets $142,291 $142,534 WORLDWIDE RESTAURANT CONCEPTS, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (in thousands, except par value) July 24, April 30, LIABILITIES AND STOCKHOLDERS' EQUITY 2005 2005 Current Liabilities: Current portion of long-term debt $7,021 $7,077 Accounts payable 17,590 16,426 Other current liabilities 27,849 29,630 Income taxes payable 3,831 4,327 Total current liabilities 56,291 57,460 Long-term debt, net of current portion 6,461 7,496 Deferred gains, rent and landlord incentives 18,602 18,917 Pension liability 13,668 13,817 Total liabilities 95,022 97,690 Minority interest 32,533 32,028 Stockholders' Equity: Preferred, authorized 1,000 shares, $5 par value; no shares issued or outstanding -- -- Common, authorized 50,000 shares, $0.01 par value; issued and outstanding 29,880 and 27,880 shares and 29,880 and 27,880 shares at July 24, 2005 and April 30, 2005, respectively 299 299 Additional paid-in capital 256,238 256,066 Accumulated deficit (224,176) (226,036) Treasury stock, 2,000 shares at July 24, 2005 and at April 30, 2005, at cost (4,135) (4,135) Accumulated other comprehensive loss (13,490) (13,378) Total stockholders' equity 14,736 12,816 Total liabilities and stockholders' equity $142,291 $142,534 DATASOURCE: Worldwide Restaurant Concepts, Inc. CONTACT: Keith Wall, Vice President and CFO, or Liz Baskerville, Director, Planning, both of Worldwide Restaurant Concepts, Inc., +1-818-662-9800; or General Information, Laurie Berman, +1-310-854-8315, or Investor/Analyst, Tricia Ross, +1-617-520-7064, both of Financial Relations Board, for Worldwide Restaurant Concepts, Inc. Web site: http://www.wrconcepts.com/

Copyright