Lone Star Steakhouse & Saloon, Inc. Third Quarter Update WICHITA, Kan., Aug. 17 /PRNewswire-FirstCall/ -- Lone Star Steakhouse & Saloon, Inc. ("Lone Star" or "Company") announced today that it estimates third quarter diluted earnings per share will be in the $.16 to $.20 range, up from $.15 per share for Q3 of 2003. For the first eight weeks of the third quarter, the Company's meat costs, which account for approximately 60% of cost of sales, are up $0.6 million or 3.8% for comparable restaurants. All commodity costs, including meat, are expected to remain at high levels for the rest of the year and will continue to have an adverse effect on the profitability of the Company. Based on its quarter to date experience, the Company now estimates that its cost of sales will be 0.8 to 1.1% higher as a percent of revenue than in the year ago quarter resulting in margin pressure beyond the normally lower third quarter margins from seasonally lower average unit volumes. Comparable store sales increases through August 10, 2004, the first eight weeks of the third quarter, were as follows: Lone Star Steakhouse & Saloon restaurants 1.4% Sullivan's Steakhouse restaurants 3.4% Del Frisco's Double Eagle Steak House restaurants 22.6% Texas Land & Cattle Steak House restaurants 13.4% Consolidated steak house restaurants 4.1% Comparable store sales and operating margins for the third quarter have benefited from Father's Day which was in our second quarter last year, but in our third quarter this year. Lone Star owns and operates 251 domestic Lone Star Steakhouse & Saloon restaurants; 15 Sullivan's Steakhouse restaurants; five Del Frisco's Double Eagle Steak House restaurants and 20 Texas Land & Cattle Steak House restaurants. Licensees operate three domestic and fourteen international Lone Star restaurants, and one domestic Del Frisco's Double Eagle Steak House restaurant. This press release contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Although the Company believes the assumptions underlying the forward-looking statements contained herein, including 2004 operating performance, comparable sales and the development plans of the Company, are reasonable, any of the assumptions could be inaccurate, and therefore, there can be no assurance that the forward- looking statements contained in the press release will prove to be accurate. DATASOURCE: Lone Star Steakhouse & Saloon, Inc. CONTACT: Rob Solomon of Rubenstein Associates, Inc., +1-212-843-8050, for Lone Star Steakhouse & Saloon, Inc. Web site: http://www.lonestarsteakhouse.com/

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