Please replace the financial tables portion of the release with
the following corrected version due to multiple revisions.
BENIHANA INC. REPORTS SECOND FISCAL QUARTER
2011 FINANCIAL RESULTS
Benihana Inc. (NASDAQ: BNHNA)(NASDAQ: BNHN), operator of the
nation’s largest chain of Japanese theme and sushi restaurants,
today reported financial results for its second fiscal quarter 2011
period ended October 10, 2010.
Richard C. Stockinger, Chairman, President and Chief Executive
Officer, said, “We delivered a strong performance at the restaurant
level in the second fiscal quarter. Top-line growth exhibited by
our reinvigorated Benihana Teppanyaki brand, coupled with effective
management of controllable expenses, resulted in a significant
reduction in restaurant operating expenses. Excluding one-time
general and administrative items totaling $4.3 million, income from
operations would have been $0.3 million. We are also pleased with
the traction we have gained thus far through our Renewal Program,
including a 9.4% gain in guest counts during the current period,
and are optimistic about achieving further sustained improvements
in our results.”
Mr. Stockinger concluded, “With respect to our capital
structure, we also strengthened our balance sheet by increasing our
cash position by $1.5 million and paying down an additional $0.8
million of outstanding debt, resulting in total borrowings of $16.9
million and remaining availability of $19.3 million as of October
10, 2010. We remain disciplined in our capital deployment,
targeting a handful of refurbishing projects while also positioning
ourselves for expansion. Concurrent with our review of strategic
alternatives, we firmly believe we can enhance value for all of our
shareholders by building upon our success to date through the
Renewal Program, as well as value-based promotions, media
advertising and local marketing initiatives across all three
restaurant concepts.”
Second Fiscal Quarter 2011 Financial Results
For the second fiscal quarter of 2011, total revenues increased
4.1% to $72.2 million from $69.3 million in the second fiscal
quarter of 2010. Total restaurant sales increased 4.1% to $71.8
million from $69.0 million in the same period last year.
Company-wide comparable restaurant sales increased 4.7%,
including 7.9% at Benihana Teppanyaki, but decreased 0.9% at RA
Sushi and 1.0% at Haru. During the quarter, Benihana Teppanyaki
represented approximately 66% of consolidated restaurant sales,
while RA Sushi and Haru accounted for 24% and 10% of consolidated
restaurant sales, respectively. There were a total of 1,160
store-operating weeks in the second fiscal quarter of 2011 compared
to 1,179 store-operating weeks in the second fiscal quarter of
2010.
Cost of food and beverage sales for the second fiscal quarter of
2011 totaled $17.5 million, or 24.4% of restaurant sales, compared
to $16.6 million, or 24.1% of restaurant sales, in the second
fiscal quarter of 2010. The increase in cost as a percentage of
sales is primarily due to improvements in the quality of food
offerings associated with implementation of the Renewal Program, as
well as various promotions offering Benihana Teppanyaki guests a
meal for two at a set price.
Restaurant operating expenses for the second fiscal quarter of
2011 totaled $48.2 million, or 67.1% of restaurant sales, compared
to $49.5 million, or 71.8% of restaurant sales, in the second
fiscal quarter of 2010, reflecting improved cost and labor
management in the current period in connection with the continued
efforts of the Renewal Program.
General and administrative expenses for the second fiscal
quarter of 2011 totaled $10.5 million, or 14.6% of restaurant
revenues, compared to $5.0 million, or 7.2% of restaurant revenues,
in the same period last year. During the second fiscal quarter of
2011, the Company incurred $0.1 million in higher corporate
salaries as a result changes in Benihana Teppanyaki corporate
operations and the regional manager and regional chef structure,
$0.6 million in additional legal fees with respect to various legal
items, and $0.2 million of expense related to the general claims
liability.
The Company also incurred non-recurring costs totaling
approximately $4.3 million in the second fiscal quarter of 2011,
which consisted of $1.7 million related to various financial and
operational consulting agreements, including services provided by
our interim Chief Financial Officer, $1.5 million related to the
execution of an accounting and payroll function outsourcing
agreement, along with related accelerated depreciation expense and
final contract settlement of the ERP system and severance costs,
$0.9 million in advisory fees to respond to and ultimately settle
the proxy contest in connection with the Annual Shareholders’
Meeting, and $0.2 million related to the write-off of abandoned
projects.
Safe Harbor Statement
Except for the historical matters contained herein, statements
in this press release are forward-looking and are made pursuant to
the safe harbor provisions of the Private Securities Litigation
Reform Act of 1995. Investors are cautioned that forward-looking
statements involve risks and uncertainties that may affect the
business and prospects of the Company, including, without
limitation: risks related to the Company’s business strategy,
including the Company’s Renewal Program and marketing programs;
risks related to the Company’s ability to operate successfully in
the current challenging economic environment; risks related to the
Company’s efforts to strengthen its Benihana Teppanyaki concept and
build its RA Sushi and Haru brands; and other risks and
uncertainties that may cause results to differ materially from
those set forth in the forward-looking statements. Past performance
may not be indicative of future results. Although the Company
believes the expectations reflected in such forward-looking
statements are based upon reasonable assumptions, there can be no
assurance that its expectations will be realized. In addition to
the risks and uncertainties set forth above, investors should
consider the risks and uncertainties discussed in the Company’s
filings with the Securities and Exchange Commission, including,
without limitation, the risks and uncertainties discussed under the
heading “Risk Factors” in such filings. The Company does not
undertake any obligation to publicly update any forward-looking
statement to reflect events or circumstances after the date on
which any such statement is made or to reflect the occurrence of
unanticipated events.
About Benihana
Headquartered in Miami, Benihana Inc. (NASDAQ GS: BNHN, BNHNA)
is the nation's leading operator of Japanese theme and sushi
restaurants with 97 restaurants nationwide, including 63 Benihana
restaurants, nine Haru sushi restaurants, and 25 RA Sushi
restaurants. In addition, 20 franchised Benihana restaurants are
operating in the United States, Latin America and the
Caribbean.
To learn more about Benihana Inc. and its three 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 October 10,
October 11,
Percentage
2010
2009
change Comparable restaurant sales by concept: Teppanyaki
$
47,266 $ 43,796 7.9 % RA Sushi
16,918 17,071 -0.9 %
Haru
7,411 7,489 -1.0 % Total comparable
restaurant sales
$ 71,595 $ 68,356 4.7 %
Seven Periods Ended October 10,
October 11,
Percentage
2010
2009
change Total restaurant sales by concept: Teppanyaki
$
111,479 $ 105,941 5.2 % RA Sushi
38,995 39,178 -0.5 %
Haru
17,792 17,623 1.0 % Total restaurant
sales
$ 168,266 $ 162,742 3.4 %
Benihana Inc. and Subsidiaries
Condensed Consolidated Statements of
Earnings
(Unaudited)
(In thousands)
Three Periods Ended October 10,
October 11,
2010
2009 Revenues:
Restaurant sales
$ 71,817 99.5 % $
68,989 99.5 % Franchise fees and royalties
373
0.5 % 359
0.5 % Total revenues
72,190
100.0 % 69,348 100.0 %
Restaurant Expenses: Cost of food and beverage sales
17,504 24.2 % 16,646 24.0 % Restaurant
operating expenses
48,190 66.8 % 49,516 71.4 %
Restaurant opening costs
- 0.0 % 160 0.2 %
General and administrative expenses
10,504
14.6 % 4,959
7.2 % Total operating expenses
76,198 105.6
% 71,281 102.8 % (Loss) Income from operations
(4,008 ) -5.6 % (1,933 ) -2.8 %
Interest income (expense), net
124
0.2 % (407 ) -0.6 %
Loss before income taxes
(3,884 ) -5.4
% (2,340 ) -3.4 % Income tax benefit
(882 ) -1.2 %
(1,501 ) -2.2 % Net (Loss) Income
(3,002
) (839 )
Less: Accretion of preferred stock
issuance costs and preferred stock dividends
250 250
Net loss attributable to common
stockholders
$ (3,252 )
$ (1,089 ) Loss Per Share Basic loss
per common share
$ (0.21 ) $ (0.07 ) Diluted
loss per common share
$ (0.21 )
$ (0.07 ) Weighted Average
Shares Outstanding Basic
15,442 15,339 Diluted
15,442 15,339
Benihana Inc. and Subsidiaries
Condensed Consolidated Statements of
Earnings
(Unaudited)
(In thousands)
Seven Periods Ended October 10,
October 11,
2010
2009 Revenues:
Restaurant sales
$ 172,044 99.5 % $
164,454 99.5 % Franchise fees and royalties
915 0.5 % 866
0.5 % Total revenues
172,959
100.0 % 165,320
100.0 % Restaurant Expenses: Cost of food and
beverage sales
42,099 24.3 % 39,004 23.6 %
Restaurant operating expenses
112,428 65.0 %
112,917 68.3 % Restaurant opening costs
8 0.0
% 1,063 0.6 % General and administrative expenses
19,901 11.5 %
12,289 7.4 % Total operating expenses
174,436 100.9 % 165,273 100.0 % (Loss)
Income from operations
(1,477 ) -0.9 %
47 0.0 % Interest income (expense), net
(273
) -0.2 % (804 )
-0.5 % Loss before income taxes
(1,750 )
-1.0 % (757 ) -0.5 % Income tax benefit
(357 ) -0.2 %
(1,010 ) -0.6 % Net (Loss) Income
(1,393
) 253
Less: Accretion of preferred stock
issuance costs and preferred stock dividends
583 583
Net loss attributable to common
stockholders
$ (1,976 )
$ (330 ) Loss Per Share Basic loss per
common share
$ (0.13 ) $ (0.02 ) Diluted loss
per common share
$ (0.13 )
$ (0.02 ) Weighted Average
Shares Outstanding Basic
15,451 15,374 Diluted
15,451 15,374
Benihana Inc. and Subsidiaries
Condensed Balance Sheet Data
(Unaudited)
(In thousands)
October 10, March 28,
2010 2010
Assets Cash and cash equivalents
$ 7,622 $ 2,558 Other current assets
14,416 13,149 Total current assets
22,038 15,707 Property and equipment, net
187,469 194,261 Goodwill
6,896 6,896 Other assets,
net
14,768 17,226 Total assets
$ 231,171 $ 234,090
Liabilities, Convertible Preferred Stock and Stockholders’
Equity Current Liabilities: Borrowings under line of credit
$ 16,923 $ 22,410 Other current liabilities
36,972 32,979 Total current liabilities
53,895 55,389 Other long term liabilities
15,312 15,362 Total liabilities
69,207 70,751 Convertible
preferred stock
19,670 19,623
Stockholders’ Equity Total stockholders’ equity
142,294 143,716 Total
liabilities, convertible preferred stock and stockholders' equity
$ 231,171 $ 234,090
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