LUBY'S, INC. HOUSTON, Jan. 21, 2016 /PRNewswire/ -- Luby's, Inc. (NYSE: LUB) ("Luby's") today announced unaudited financial results for its sixteen-week first quarter fiscal 2016, which ended on December 16, 2015. As announced in the company's fourth quarter fiscal 2015 earnings press release, Luby's has changed the number of reporting weeks included in the first fiscal quarter from 12 weeks to 16 weeks. This change is in part to minimize the Thanksgiving calendar shift by extending the first fiscal quarter until after Thanksgiving. The company now reports 16 weeks in its first fiscal quarter, and the remaining three quarters will typically include 12 weeks. Comparisons in this press release for the first quarter fiscal year 2016 are referred to as "first quarter."
First Quarter Highlights
-- Total same-store sales increased 1.4%
-- Luby's Cafeterias same-store sales increased 1.2%
-- Fuddruckers same-store sales increased 1.3%
-- Cheeseburger in Paradise same-store sales increased 5.5%
-- Total restaurant sales increased 2.1%
-- Opened two company-owned Fuddruckers restaurants located in Wisconsin
and Indiana
-- Opened six new Fuddruckers franchise restaurants
-- Store Level Profit grew to 14.8% compared to 12.8% during the comparable
16 weeks last year
-- Expenses declined in Cost of food, Payroll and related costs, Other
operating and Occupancy costs
-- Combo location sales grew to $7.0 million, representing 6.2% of total
restaurant sales
-- Adjusted EBITDA increased to $5.7 million compared to $3.3 million
during the comparable 16 weeks last year
Chris Pappas, President and CEO, commented, "In the first quarter, same store-sales growth and lower expenses increased our store-level profit margin and improved earnings year over year. Our team continues to execute on our strategy to enhance store level performance across all of our brands through a defined process of investing, coaching, training, and building our leadership throughout the organization. We are focused on driving value through achieving operational excellence and efficient cost management to grow profitability and enhance shareholder value."
Same-Store Sales Year-Over-Year Comparison
Q1 Q4 Fiscal
2016(3) 2015 2015
------ ---- ----
Luby's Cafeterias 1.2% 0.2% 0.6%
----------------- --- --- ---
Fuddruckers Restaurants 1.3% 1.7% 1.1%
----------------------- --- --- ---
Combo Locations (1) (1.3%) (6.4%) (1.8%)
(Represents two
locations)
---------------
Cheeseburger in Paradise 5.5% 2.8% (2.9%)
------------------------ --- --- -----
Total same-store sales
(2) 1.4% 0.7% 0.5%
---------------------- --- --- ---
(1) Combo locations consist of a side-
by-side Luby's Cafeteria and
Fuddruckers Restaurant at one
property location.
(2) Note: Luby's includes a
restaurant's sales results into
the same-store sales calculation
in the quarter after a store has
been open for six complete
consecutive quarters. In the
first quarter, there were 88
Luby's Cafeterias, 59 Fuddruckers
Restaurants, 2 Combo locations,
and 8 Cheeseburger in Paradise
locations that met the definition
of same-stores.
(3) Q1 2016 same-store sales reflects
the change in restaurant sales for
the locations included in the
same-store grouping for the 16-
week first quarter relative to the
comparable 16-week period in
fiscal 2015.
First Quarter Restaurant Sales:
($ millions)
-----------
Restaurant Brand Q1 2016 Q1 2015 Q1 2015 Change Change (%)
Comp Q1* Comp Q1* Comp Q1*
--- --- ------- ------- --------
(16 weeks) (12 weeks) (16 weeks) (16 weeks) (16 weeks)
--------- --------- --------- --------- ---------
Luby's Cafeterias $70,905 $50,548 $71,111 $(206) (0.3%)
----------------- ------- ------- ------- ----- -----
Fuddruckers
Restaurants 30,880 21,452 28,782 2,098 7.3%
------------ ------ ------ ------ ----- ---
Combo Locations 7,020 5,057 6,847 173 2.5%
--------------- ----- ----- ----- --- ---
Cheeseburger in
Paradise 4,741 3,500 4,493 248 5.5%
--------------- ----- ----- ----- --- ---
Total Restaurant
Sales $113,546 $80,557 $111,233 $2,313 2.1%
---------------- -------- ------- -------- ------ ---
Note: FY2016 Q1 includes high
sales volume around
Thanksgiving and Christmas
holidays. FY2015 Q1 ended the
day prior to Thanksgiving
* "Comp Q1" is the 16 week
period in fiscal 2015 that is
comparable to the 16 week
period in fiscal 2016
-- Total Restaurant sales in the first quarter increased to $113.5 million,
an increase of $2.3 million versus the comparable 16 weeks of fiscal
2015.
-- Luby's Cafeterias sales decreased $0.2 million versus the comparable 16
weeks of fiscal 2015, due to the closure of two Luby's Cafeterias,
offset by a 1.2% increase in same-store sales. The 1.2% increase in
Cafeteria same-store sales was the result of a 0.8% increase in guest
traffic and a 0.4% increase in average spend per guest.
-- Fuddruckers restaurant sales increased $2.1 million versus the
comparable 16 weeks of fiscal 2015, due to a net increase of four
operating Fuddruckers restaurants and a 1.3% increase in same-store
sales. The 1.3% increase in Fuddruckers same-store sales was the result
of a 4.5% increase in average spend per guest offset by a 3.2% decrease
in guest traffic.
-- Combo location sales increased $0.2 million in the first quarter due to
the addition of our sixth Combo location, offset by a net decrease in
sales at other Combo locations. Combo locations together represented
6.2% of total restaurant sales in the first quarter.
-- Cheeseburger in Paradise restaurant sales increased 5.5% with all eight
Cheeseburger in Paradise locations in operation included in our
same-store grouping.
-- Store level profit, defined as restaurant sales plus vending revenue
less cost of food, payroll and related costs, other operating expenses,
and occupancy costs, was $16.8 million, or 14.8% of restaurant sales, in
the first quarter compared to $14.2 million, or 12.8% of restaurant
sales, during the comparable 16 weeks of fiscal 2015. Lower overall
cost of food, payroll and related costs, other operating expenses and
occupancy costs led to this increase in profitability. Store level
profit is a non-GAAP measure, and reconciliation to income from
continuing operations is presented after the financial statements.
-- Culinary Contract Services revenues decreased to $4.9 million with 28
operating locations in the first quarter compared to $5.9 million during
the comparable 16 weeks of fiscal 2015 with 26 operating locations. The
decrease in Culinary Contract Services revenue was the result of higher
sales volume locations ceasing operations over the past 12 months,
replaced with lower sales volume locations. Culinary profit was 10.0%
of Culinary Contract Services sales in the first quarter and 10.3% of
Culinary Contract Sales in the comparable 16-week period of fiscal 2015.
Both quarters exceeded our profit targets for the business segment.
-- Franchise revenue was $2.1 million in the first quarter and in the
comparable 16-week period of fiscal 2015. In the first quarter,
franchisees opened six restaurants: internationally in Italy, Colombia,
and Mexico and domestically in Michigan, California, and Florida.
-- Income from continuing operations was a loss of $1.7 million, or $0.06
per diluted share compared to a loss of $2.9 million, or a loss of $0.10
per diluted share, in the first quarter fiscal 2015. Excluding special
items, loss from continuing operations was $1.9 million, or a loss of
$0.07 per diluted share, in the first quarter fiscal 2016 compared to a
loss of $2.7 million, or a loss of $0.09 per diluted share, in the first
quarter fiscal 2015.
Reconciliation of loss from continuing operations to loss from continuing operations, before special items (1,2):
Q1 FY2016 Q1 FY2015
--------- ---------
Item Amount Per Share Amount Per Share
($000s) ($) ($000s) ($)
--- ------ --- ------ ---
Loss from continuing
operations $(1,739) (0.06) (2,880) (0.10)
Loss (gain) on asset
disposals and
impairments (184) (0.01) 191 0.01
Loss from continuing
operations, before
special items $(1,923) (0.07) (2,689) (0.09)
(1) Luby's uses income (loss) from
continuing operations, before
special items, in analyzing
its results, which is a non-
GAAP financial measure. This
information should be
considered in addition to the
results presented in
accordance with GAAP, and
should not be considered a
substitute for the GAAP
results. Luby's has
reconciled loss from
continuing operations, before
special items, to loss from
continuing operations, the
nearest GAAP measure in
context.
(2) Per share amounts are per
diluted share after tax.
Balance Sheet and Capital Expenditures
We ended the first quarter with a debt balance outstanding of $35.0 million, down from $37.5 million at the end of the fourth quarter fiscal 2015. During the first quarter, our capital expenditures were $5.7 million, compared to $3.6 million in the 12-week first quarter fiscal 2015. At the end of the first quarter, we had $1.6 million in cash and $173.4 million in total shareholders' equity.
Restaurant Counts:
Fiscal 2016 2016 Q1 2016 Q1 Fiscal
2016
Year Begin Openings Closings Q1 End
Luby's Cafeterias(1) 93 93
Fuddruckers(1) 75 2 77
Cheeseburger in Paradise 8 8
Other restaurants (2) 1 1
--- ---
Total 177 2 179
--- --- ---
(1) Includes 6 restaurants that
are part of Combo locations
(2) Other restaurants include one
Bob Luby's Seafood
Conference Call
Luby's will host a conference call on January 22, 2016 at 10:00 a.m. Central Time to discuss further its first quarter fiscal 2016 results. To access the call live, dial (412) 902-0030 and use the access code 13627673# at least 10 minutes prior to the start time, or listen live over the Internet by visiting the events page in the investor relations section of www.lubysinc.com. For those who cannot listen to the live call, a telephonic replay will be available through January 29, 2016 and may be accessed by calling (201) 612-7415 and using the access code 13627673#. Also, an archive of the webcast will be available after the call for a period of 90 days on the "Investors" section of the Company's website.
About Luby's
Luby's, Inc. (NYSE: LUB) operates 179 restaurants nationally: 93 Luby's Cafeterias, 77 Fuddruckers, 8 Cheeseburger in Paradise and one Bob Luby's Seafood Grill. The Company is the franchisor for 111 Fuddruckers franchise locations across the United States (including Puerto Rico), Canada, Mexico, Italy, the Dominican Republic, Panama, Chile, and Colombia. Additionally, a licensee operates 35 restaurants with the exclusive right to use the Fuddruckers proprietary marks, trade dress, and system in certain countries in the Middle East. The Company does not receive revenue or royalties from these Middle East restaurants. Luby's Culinary Contract Services provides food service management to 28 sites consisting of healthcare, higher education and corporate dining locations
This press release contains statements that are "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. All statements contained in this press release, other than statements of historical fact, are "forward-looking statements" for purposes of these provisions, including the statements under the caption "Outlook" and any other statements regarding scheduled openings of units, scheduled closures of units, sales of assets, expected proceeds from the sale of assets, expected levels of capital expenditures, effects of food commodity costs, anticipated financial results in future periods and expectations of industry conditions.
Luby's cautions readers that various factors could cause its actual financial and operational results to differ materially from those indicated by forward-looking statements made from time-to-time in news releases, reports, proxy statements, registration statements, and other written communications, as well as oral statements made from time to time by representatives of Luby's. The following factors, as well as any other cautionary language included in this press release, provide examples of risks, uncertainties and events that may cause Luby's actual results to differ materially from the expectations Luby's describes in such forward-looking statements: general business and economic conditions; the impact of competition; our operating initiatives; fluctuations in the costs of commodities, including beef, poultry, seafood, dairy, cheese and produce; increases in utility costs, including the costs of natural gas and other energy supplies; changes in the availability and cost of labor; the seasonality of Luby's business; changes in governmental regulations, including changes in minimum wages; the effects of inflation; the availability of credit; unfavorable publicity relating to operations, including publicity concerning food quality, illness or other health concerns or labor relations; the continued service of key management personnel; and other risks and uncertainties disclosed in Luby's annual reports on Form 10-K and quarterly reports on Form 10-Q.
For additional information contact:
Dennard-Lascar Associates
713-529-6600
Rick Black / Ken Dennard
Investor Relations
Luby's, Inc.
Consolidated Statements of Operations (unaudited)
------------------------------------------------
(In thousands, except per share data)
Quarter Ended
December 16, November 19,
2015 2014
---- ----
(16 weeks) (12 weeks)
SALES:
Restaurant sales $113,546 $80,557
Culinary contract services 4,915 4,598
Franchise revenue 2,125 1,581
Vending revenue 158 125
--- ---
TOTAL SALES 120,744 86,861
COSTS AND EXPENSES:
Cost of food 32,434 23,484
Payroll and related costs 39,424 28,686
Other operating expenses 18,421 14,219
Occupancy costs 6,642 4,942
Opening costs 397 925
Cost of culinary contract services 4,422 4,099
Cost of franchise operations 612 384
Depreciation and amortization 7,014 5,068
Selling, general and administrative
expenses 13,243 9,151
Net (gain) loss on disposition of
property and equipment (279) 290
---- ---
Total costs and expenses 122,330 91,248
------- ------
LOSS FROM OPERATIONS (1,586) (4,387)
Interest income 1 1
Interest expense (696) (456)
Other income (expense), net (118) 180
---- ---
Loss before income taxes and
discontinued operations (2,399) (4,662)
Benefit for income taxes (660) (1,782)
---- ------
Loss from continuing operations (1,739) (2,880)
Loss from discontinued operations,
net of income taxes (72) (139)
--- ----
NET LOSS $(1,811) $(3,019)
------- -------
Loss per share from continuing
operations:
Basic $(0.06) $(0.10)
Assuming dilution (0.06) (0.10)
===== =====
Loss per share from discontinued
operations:
Basic $(0.00) $(0.01)
Assuming dilution (0.00) (0.01)
===== =====
Net loss per share:
Basic $(0.06) $(0.11)
Assuming dilution (0.06) (0.11)
===== =====
Weighted average shares
outstanding:
Basic 29,133 28,890
Assuming dilution 29,133 28,890
The following table contains information derived from the Company's Consolidated Statements of Operations expressed as a percentage of sales. Percentages may not add due to rounding.
Quarter Ended
=============
December 16, November 19, December 17,
2015 2014 2014
==== ==== ====
(16 weeks) (12 weeks) (16 weeks)
Restaurants sales
Culinary contract
services 94.0% 92.7% 93.1%
Franchise revenue 4.1% 5.3% 4.9%
Vending revenue 1.8% 1.8% 1.8%
TOTAL SALES 0.1% 0.1% 0.1%
--- --- ---
100.0% 100.0% 100.0%
COST AND EXPENSES:
(As a percentage of
restaurant sales)
Cost of food 28.6% 29.2% 29.4%
Payroll and related
costs 34.7% 35.6% 34.8%
Other operating
expenses 16.2% 17.7% 17.1%
Occupancy costs 5.8% 6.1% 6.0%
Vending income (0.1)% (0.2)% (0.1)%
----- ----- -----
Store level profit 14.8% 11.6% 12.8%
==== ==== ====
(As a percentage of
total sales)
Selling, general
and administrative
expenses 11.0% 10.5% 10.3%
LOSS FROM
OPERATIONS (1.3)% (5.1)% (3.3)%
Luby's, Inc.
Consolidated Balance Sheets
---------------------------
(In thousands, except per share data)
December 16, August 26,
2015 2015
---- ----
(Unaudited)
ASSETS
Current Assets:
Cash and cash equivalents $1,581 $1,501
Trade accounts and other receivables, net 4,949 5,175
Food and supply inventories 4,948 4,483
Prepaid expenses 2,881 3,402
Assets related to discontinued operations 3 10
Deferred income taxes 577 577
--- ---
Total current assets 14,939 15,148
Property held for sale 3,058 4,536
Assets related to discontinued operations 3,672 3,671
Property and equipment, net 199,754 200,202
Intangible assets, net 22,089 22,570
Goodwill 1,643 1,643
Deferred income taxes 13,844 12,917
Other assets 3,613 3,571
----- -----
Total assets $262,612 $264,258
======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts payable $18,912 $20,173
Liabilities related to discontinued
operations 438 408
Accrued expenses and other liabilities 27,448 23,967
------ ------
Total current liabilities 46,798 44,548
Credit facility debt 35,000 37,500
Liabilities related to discontinued
operations 17 182
Other liabilities 7,429 7,369
----- -----
Total liabilities 89,244 89,599
====== ======
Commitments and Contingencies
SHAREHOLDERS' EQUITY
Common stock, $0.32 par value; 100,000,000
shares authorized; shares issued were
29,325,754 and 29,134,603, respectively;
shares outstanding were 28,825,754 and
28,634,603, respectively 9,384 9,323
Paid-in capital 29,465 29,006
Retained earnings 139,294 141,105
Less cost of treasury stock, 500,000 shares (4,775) (4,775)
------ ------
Total shareholders' equity 173,368 174,659
------- -------
Total liabilities and shareholders' equity $262,612 $264,258
======== ========
Luby's, Inc.
Consolidated Statements of Cash Flows (unaudited)
------------------------------------------------
(In thousands)
Quarter Ended
-------------
December 16, November 19,
2015 2014
---- ----
(16 weeks) (12 weeks)
CASH FLOWS FROM OPERATING
ACTIVITIES:
Net loss $(1,811) $(3,019)
Adjustments to reconcile net loss
to net cash provided by operating
activities:
Net (gain) loss on disposition of
property and equipment (279) 290
Depreciation and amortization 7,021 5,073
Amortization of debt issuance cost 148 36
Non-cash compensation expense 75 -
Share-based compensation expense 445 322
Other non-cash compensation
expense 74 -
Deferred tax benefit (927) (2,028)
---- ------
Cash provided by operating
activities before changes in
operating assets and liabilities 4,746 674
Changes in operating assets and
liabilities:
Decrease (Increase) in trade
accounts and other receivables 226 (690)
Increase in food and supply
inventories (968) (1,998)
Decrease in prepaid expenses and
other assets 364 1,118
Increase (Decrease) in accounts
payable, accrued expenses and
other liabilities 1,975 (3,431)
----- ------
Net cash provided by (used in)
operating activities 6,343 (4,327)
----- ------
CASH FLOWS FROM INVESTING
ACTIVITIES:
Proceeds from disposal of assets
and property held for sale 1,916 692
Decrease in notes receivable 17 -
Purchases of property and equipment (5,729) (3,589)
------ ------
Net cash used in investing
activities (3,796) (2,897)
------ ------
CASH FLOWS FROM FINANCING
ACTIVITIES:
Credit facility borrowings 27,000 25,800
Credit facility repayments (29,500) (19,500)
Debt issuance costs (42) (50)
Proceeds received on the exercise
of employee stock options 75 -
--- ---
Net cash provided by (used in)
financing activities (2,467) 6,250
------ -----
Net increase (decrease) in cash and
cash equivalents 80 (974)
Cash and cash equivalents at
beginning of period 1,501 2,788
----- -----
Cash and cash equivalents at end of
period 1,581 $1,814
===== ======
Cash paid for:
Income taxes $ - $ -
Interest 520 451
Although store level profit, defined as restaurant sales less cost of food, payroll and related costs, other operating expenses, and occupancy costs is a non-GAAP measure, we believe its presentation is useful because it explicitly shows the results of our most significant reportable segment. The following table reconciles between store level profit, a non-GAAP measure to loss from continuing operations, a GAAP measure:
Quarter Ended
-------------
December 16, November 19, December 17,
2015 2014 2014
---- ---- ----
(16 weeks) (12 weeks) (16 weeks)
Store
level
profit $16,783 $9,351 $14,218
Plus:
Sales
from
culinary
contract
services 4,915 4,598 5,908
Sales
from
franchise
revenue 2,125 1,581 2,136
Less:
Opening
costs 397 925 1,024
Cost
of
culinary
contract
services 4,422 4,099 5,302
Cost
of
franchise
operations 612 384 539
Depreciation
and
amortization 7,014 5,068 6,664
Selling,
general
and
administrative
expenses 13,243 9,151 12,262
Net
(gain)
loss
on
disposition
of
property
and
equipment (279) 290 363
Interest
income (1) (1) (1)
Interest
expense 696 456 629
Other
income
(expense),
net 118 (180) (230)
Benefit
for
income
taxes (660) (1,782) (1,776)
---- ------ ------
Loss
from
continuing
operations $(1,739) $(2,880) $(2,514)
======= ======= =======
Adjusted EBITDA
Adjusted EBITDA is defined as income (loss) from continuing operations before interest, provision (benefit) for income taxes and depreciation and amortization and excluding net gain (loss) on disposing of property and equipment, provision for asset impairments, non-cash compensation expense, and other income (expense).
Adjusted EBITDA is intended as a supplemental measure of our performance that is not required by, or presented in accordance with GAAP. We believe Adjusted EBITDA provides useful information to management and investors in valuing the Company and evaluating ongoing operating results and trends and in comparing our results to other competitors. Our management uses Adjusted EBITDA in evaluating management's performance when determining incentive compensation.
Adjusted EBITDA, as defined, may not be comparable to other similarly titled measures as computed by other companies. These measures should be considered supplemental and not a substitute or superior to other GAAP performance measures.
Quarter Ended
December 16, November 19, December 17,
2015 2014 2014
---- ---- ----
(16 weeks) (12 weeks) (16 weeks)
Loss
from
continuing
operations $(1,739) $(2,880) $(2,514)
Benefit
for
income
taxes (660) (1,782) (1,776)
Depreciation
and
amortization 7,014 5,068 6,664
Interest
expense,
net 696 455 628
Net
loss
(gain)
on
disposition
of
assets (279) 290 363
Employee
stock-
based
compensation
expense 529 154 194
Less:
Other
income
(expense),
net 118 (180) (230)
Adjusted
EBITDA $5,679 $1,125 $3,329
====== ====== ======
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SOURCE Luby's, Inc.
