Benihana Inc. (NASDAQ: BNHNA)(NASDAQ: BNHN), operator of the
nation’s largest chain of Japanese theme and sushi restaurants,
today reported results for its 12-week fiscal fourth quarter and
full year ended March 28, 2010.
Highlights for the Company's 12-week fiscal fourth quarter
2010 relative to the 12-week fiscal fourth quarter 2009
include:
- Total restaurant sales increased
5.2% to $77.4 million
- Comparable restaurant sales
increased by 1.4%, the first quarter all three concepts
(Benihana-branded teppanyaki, RA Sushi and Haru) had positive
comparable sales since the fiscal second quarter of 2008
- Income from operations of $2.9
million compared to $1.7 million
- Net income of $1.4 million, or
$0.09 in diluted earnings per share, compared to net income of $0.9
million, or $0.06 in diluted earnings per share
Highlights for the Company's 52-week full year 2010 relative
to the 52-week full year 2009 include:
- Total restaurant sales increased
2.6% to $311.8 million, the eighteenth consecutive year with a
total sales increase
- Income from operations
(excluding impairment charges) of $4.6 million compared to $11.6
million in 2009
- Reduced total FY year-end
borrowings under the line of credit to $22.4 million from $33.4
million
- Opened one new Benihana
teppanyaki restaurant in Orlando, FL
- Closed two Benihana teppanyaki
restaurants in Washington, DC and Tucson, AZ
- Opened three new RA Sushi
restaurants in Atlanta, GA; Leawood, KS and Houston, TX
Richard C. Stockinger, Chief Executive Officer, said, “We are
encouraged with recent trends as reflected in our financial results
in the fourth quarter, which included positive Company-wide
comparable restaurant sales, effective cost management and earnings
growth. We attribute our recent performance in part to improved
economic conditions and, the measurable success we have experienced
to date with our Renewal Program. The Renewal Program is focused on
the Benihana-branded teppanyaki restaurants and includes improving
the Benihana teppanyaki guest experience as it relates to value,
image, quality, consistency and Japanese culture.
Key elements of the Program include; improvements in the quality
of food and beverage without increasing entrée prices, improving
service standards, retraining all restaurant personnel, addressing
deferred maintenance issues, and implementing a comprehensive
purchasing program.
The Renewal Program is intended to have Benihana restaurants
stand out and succeed in an environment that remains very
competitive and we believe it will continue to provide benefits to
our business out into the future as the economy continues to
improve and consumer spending increases.”
Mr. Stockinger continued, “As part of our Renewal Program, we
have launched several new marketing initiatives, including our
Chef’s Table and Kabuki Kids Programs, to create greater awareness
for our flagship concept and strengthen guest connectivity. The
Chef’s Table is currently comprised of approximately 1,000,000
email addresses and is being utilized for value-based promotions
and building brand loyalty, while Kabuki Kids has approximately
100,000 participants and addresses this very important
constituency, as children are often the prime drivers in bringing
families to Benihana.”
Mr. Stockinger commented, “We are pleased with the financial
performance of our RA Sushi and Haru brands as we continue to enjoy
comparable restaurant sales improvement and effective management of
operating costs.”
Mr. Stockinger concluded, “While successful four-wall execution
at existing locations and increasing operating efficiencies will
always be our top priorities, we have also made significant
progress in reducing our outstanding borrowings under the line of
credit as of year-end by more than $11 million. As a result of our
increased financial flexibility, we have begun preparations for new
restaurant development and are also beginning to evaluate potential
complementary acquisitions to our existing portfolio of Japanese
theme and sushi restaurants.
Fiscal Fourth Quarter 2010 Results
For fiscal fourth quarter of 2010, total revenues increased 5.1%
to $77.8 million, compared to $74.0 million in fiscal fourth
quarter of 2009. Total restaurant sales increased 5.2% to $77.4
million in the fourth fiscal quarter of 2010 from $73.6 million in
the fourth fiscal quarter of 2009.
On a comparable basis, Company-wide comparable restaurant sales
increased 1.4%, including 1.0% at Benihana teppanyaki, 2.1% at RA
Sushi, and 2.4% at Haru. This is the first time same store sales
have increased since the fiscal second quarter of 2008. During the
period, Benihana teppanyaki represented approximately 66% of
consolidated restaurant sales, while RA Sushi and Haru accounted
for 24% and 10% of consolidated restaurant sales, respectively.
Income from operations for the fiscal fourth quarter of 2010 was
$2.9 million, compared to $1.7 million a year-ago.
Cost of food and beverage sales for the fiscal fourth quarter of
2010 totaled $18.8 million, or 24.1% of sales compared to $17.1
million or 23.2% of sales in the same period last year. The
increase in cost as a percentage of sales is primarily due to the
improving the quality of food offerings associated with
implementation of the Renewal Program.
Restaurant operating expenses for the fiscal fourth quarter of
2010 totaled $47.7 million, or 61.3% of sales compared to $45.0
million, or 60.9% of sales in the same period last year. The
increase in cost as a percentage of sales is primarily due to
expenses associated with implementation of the Renewal Program.
Marketing, general and administrative expenses for the fiscal
fourth quarter of 2010 totaled $8.5 million, or 10.9% of sales,
compared to $9.7 million, or 13.1% of sales in the same period last
year. During the fiscal fourth quarter of 2010, the Company
incurred one-time expenses for professional fees, legal fees and
severance costs totaling $1.3 million. Also, the Company reduced
its marketing expenses, as participation in the Chef’s Table and
Kabuki Kids programs expanded and the success of the Company’s
Dinner-for-Two promotions was realized. During the fiscal fourth
quarter of 2009, the Company incurred a one-time expense of $3.2
million related to the resignation of the former CEO.
Net income for the fiscal fourth quarter of 2010 was $1.4
million, or $0.09 in diluted earnings per share, compared to net
income of $0.9 million, or $0.06 in diluted earnings per share in
the same quarter last year.
Full Year 2010 Results
Total revenues for the 52-week fiscal year 2010 increased 2.6%
to $313.5 million, compared to $305.6 million in the 52-week fiscal
year 2009.
For fiscal year 2010, Company-wide comparable restaurant sales
decreased (5.8%), including (7.9%) at Benihana teppanyaki, 2.6% at
RA Sushi, and (8.3%) at Haru. Benihana teppanyaki represented
approximately 67% of consolidated restaurant sales, while RA Sushi
and Haru accounted for 22% and 11% of consolidated restaurant
sales, respectively.
Income from operations, excluding impairment charges, for the
fiscal year 2010 was $4.6 million, compared to $11.6 million a
year-ago.
Net loss for the fiscal year 2010 was $8.9 million, or $0.65 in
diluted earnings per share, compared to net loss of $6.2 million,
or $0.40 in diluted earnings per share in 2009.
The above discussion contains certain non-GAAP financial
measures as defined under SEC rules, such as net (loss) income and
diluted (loss) earnings per share, adjusted in each case to exclude
certain items disclosed above. The Company believes that each of
the foregoing non-GAAP financial measures improves the transparency
of the Company’s disclosure, provides a meaningful presentation of
the Company’s results from its ongoing operations excluding the
impact of items not related to the Company’s ongoing operations,
and improves the period-to-period comparability of the Company’s
results from its ongoing operations.
About Benihana
Benihana Inc. (NASDAQ: BNHNA; BNHN) operates 97 restaurants
nationwide, including 63 Benihana teppanyaki restaurants, nine Haru
sushi restaurants, and 25 RA Sushi Bar restaurants. In addition, 22
franchised Benihana teppanyaki restaurants are operating in the
U.S., Latin America and the Caribbean.
To learn more about the Company and its three Japanese theme and
sushi restaurant concepts, please view the corporate video at
www.benihana.com/about/video
Benihana Inc.
and Subsidiaries Sales by Concept (Unaudited)
(in
thousands) Three Periods Ended 28-Mar-10
29-Mar-09
$ Change
% Change Total restaurant sales by
concept: Benihana $ 51,523 $ 50,330 $ 1,193 2.4 % RA Sushi
18,201 15,776 2,425 15.4 % Haru 7,648
7,472 176 2.4 % Total
restaurant sales $ 77,372 $ 73,578 $
3,794 5.2 %
Comparable
restaurant sales by concept: Benihana $ 50,344 $ 49,826 $ 518
1.0 % RA Sushi 16,114 15,776 338 2.1 % Haru 7,648
7,472 176
2.4 % Total comparable restaurant sales $ 74,106 $
73,074 $ 1,032 1.4 %
Thirteen Periods Ended
28-Mar-10 29-Mar-09
$ Change
% Change Total restaurant sales by
concept: Benihana $ 205,638 $ 206,970 $ (1,332 ) -0.6 % RA
Sushi 73,484 61,270 12,214 19.9 % Haru 32,675
35,628 (2,953 ) -8.3 %
Total restaurant sales $ 311,797 $ 303,868
$ 7,929 2.6 %
Comparable restaurant sales by concept: Benihana $ 189,783 $
205,998 $ (16,215 ) -7.9 % RA Sushi 62,852 61,270 1,582 2.6 % Haru
32,675 35,628
(2,953 ) -8.3 % Total comparable restaurant sales $
285,310 $ 302,896 $ (17,586 )
-5.8 %
Benihana Inc. and Subsidiaries Condensed Consolidated
Statements of Earnings (Unaudited)
(in thousands except
per share data) Three Periods Ended 28-Mar-10
% of Sales 29-Mar-09
% of Sales Revenues Restaurant
sales $ 77,372 99.4 % $ 73,578 99.5 % Franchise fees and royalties
454 0.6 % 375
0.5 % Total revenues 77,826
100.0 % 73,953
100.0 %
Costs and Expenses Cost of food and
beverage sales 18,791 24.1 % 17,122 23.2 % Restaurant operating
expenses 47,676 61.3 % 45,011 60.9 % Restaurant opening costs (18 )
0.0 % 427 0.6 % Marketing, general and administrative expenses
8,458 10.9 % 9,717
13.1 % Total operating expenses 74,907
96.2 % 72,277
97.7 % Income from operations 2,919 3.8 %
1,676 2.3 % Interest (expense) income, net (776 )
-1.0 % (337 ) -0.5 %
Income before income taxes 2,143 2.8 % 1,339 1.8 % Income
tax expense (benefit) 452 0.6 %
175 0.2 %
Net
income 1,691 2.2 % 1,164 1.6 % Less: accretion of preferred
stock issuance costs and preferred stock dividends 252
251
Net income attributable to common
stockholders $ 1,439 1.8 % $
913 1.2 %
Earnings Per Share
Basic earnings per common share $ 0.09 $ 0.06 Diluted
earnings per common share $ 0.09 $ 0.06
Weighted Average Shares Outstanding Basic 15,403
15,297 Diluted 18,628
15,297
Benihana Inc. and Subsidiaries Condensed Consolidated
Statements of Earnings (Unaudited)
(in thousands except
per share data) Thirteen Periods Ended 28-Mar-10
% of Sales 29-Mar-09
% of Sales Revenues Restaurant
sales $ 311,797 99.4 % $ 303,868 99.4 % Franchise fees and
royalties 1,727 0.6 %
1,739 0.6 % Total revenues
313,524 100.0 % 305,607
100.0 %
Costs and Expenses Cost
of food and beverage sales 74,759 23.8 % 72,646 23.8 % Restaurant
operating expenses 201,867 64.4 % 188,922 61.8 % Restaurant opening
costs 1,045 0.3 % 2,165 0.7 % Marketing, general and administrative
expenses 31,244 10.0 % 30,289 9.9 % Impairment charges
12,347 3.9 % 21,505
7.0 % Total operating expenses 321,262
102.5 % 315,527
103.2 % (Loss) income from operations (7,738 )
-2.5 % (9,920 ) -3.2 % Interest (expense) income, net (2,020
) -0.6 % (848 )
-0.3 % (Loss) income before income taxes (9,758 ) -3.1 %
(10,768 ) -3.5 % Income tax (benefit) provision (815 )
-0.3 % (5,703 )
-1.9 %
Net (loss) income (8,943 ) -2.9 % (5,065 )
-1.7 % Less: accretion of preferred stock issuance costs and
preferred stock dividends 1,085 0.3 %
1,087 0.4 %
Net
(loss) income attributable to common stockholders $ (10,028 )
-3.2 % $ (6,152 ) -2.0 %
(Loss) Earnings Per Share Basic (loss) earnings per
common share $ (0.65 ) $ (0.40 ) Diluted (loss) earnings per common
share $ (0.65 ) $ (0.40 )
Weighted Average Shares
Outstanding Basic 15,388 15,289
Diluted 15,388 15,289
Benihana Inc. and Subsidiaries Condensed Balance
Sheet Data (Unaudited)
(in thousands)
28-Mar-10 29-Mar-09
Assets Cash and cash equivalents $ 2,558 $ 3,891 Other
current assets 13,149 13,621 Total
current assets 15,707 17,512 Property and equipment, net
194,261 203,299 Goodwill 6,896 18,020 Other assets 17,226
18,296 $ 234,090 $
257,127
Liabilities and Stockholders’ Equity
Borrowings under line of credit $ 22,410 $ - Other current
liabilities 32,979 36,566 Total current
liabilities 55,389 36,566 Borrowings under line of credit -
33,351 Other liabilities 15,362 15,237
Total liabilities 70,751 85,154 Convertible preferred stock
19,623 19,536 Total stockholders’ equity 143,716
152,437 $ 234,090 $ 257,127
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