- Same-store sales increases of 4.1% at company-owned and 2.1% at
franchised restaurants -
- Earnings per diluted share increase of 16% to $0.36 includes
charges related to restaurant relocations of $0.02 -
MINNEAPOLIS--(BUSINESS WIRE)--April 29, 2008--Buffalo Wild Wings,
Inc. (Nasdaq: BWLD), announced today financial results for the first
quarter ended March 30, 2008. Highlights for the first quarter versus
the same period a year ago were:
-- Total revenue increased 21.7% to $97.3 million
-- Company-owned restaurant sales grew 22.3% to $86.9 million
-- Same-store sales increased 4.1% at company-owned restaurants
and 2.1% at franchised restaurants
-- Earnings per diluted share, which includes charges related to
restaurant relocations of $0.02, increased 16% to $0.36 from
$0.31
Sally Smith, President and Chief Executive Officer, commented,
"2008 is off to a great start. We are very proud of our results,
especially given the current economic environment. Our 15% unit growth
and 22% revenue growth are in line with our annual goals. Earnings per
diluted share increased 16% to $0.36 per share. As expected, with more
company-owned restaurants opening earlier in the year, and the ongoing
rent associated with the purchase and conversion of the eight Don
Pablo's locations, our first quarter preopening expenses increased by
$867,000, and the accelerated depreciation and impairment for the
upcoming relocations of three restaurants was $510,000 for the
quarter. Without these year-over-year incremental costs, our net
income would have increased by over 30%."
Total revenue increased 21.7% to $97.3 million in the first
quarter compared to $79.9 million in the first quarter of 2007.
Company-owned restaurant sales for the quarter increased 22.3% to
$86.9 million driven by a company-owned same-store sales increase of
4.1% and 25 more company-owned restaurants in operation at the end of
first quarter 2008 relative to the same period in 2007. Franchise
royalties and fees increased 17.2% to $10.4 million versus $8.8
million in the prior year. This increase was due to a franchised
same-store sales increase of 2.1% and 41 more franchised restaurants
at the end of the period versus a year ago.
Average weekly sales for company-owned restaurants were $41,438
for the first quarter of 2008 compared to $39,254 for the same quarter
last year, a 5.6% increase. Franchised restaurants averaged $47,812
for the period versus $46,439 in the first quarter a year ago, a 3.0%
increase.
For the first quarter, earnings per diluted share were $0.36, as
compared to first quarter 2007 earnings per diluted share of $0.31.
2008 Outlook
Ms. Smith concluded, "We are very pleased with the sustained
strength of our same-store sales, and we are intensely focused on
driving guests to Buffalo Wild Wings and delivering a great
experience. Five new company-owned and 10 franchised locations are
expected to open in the second quarter, ahead of our development pace
of 2007 and on track to achieve our annual 15% unit growth target. As
a result of the additional units in construction, preopening expenses
are expected to be about $1.2 million in the second quarter. The
purchase of the nine Las Vegas franchised locations is now anticipated
to close in the third quarter. We are confident that these units,
combined with our unit growth and strong unit-level performance, will
enable us to achieve our annual goal of increasing net income by 25%."
Buffalo Wild Wings will be hosting a conference call today, April
29, 2008 at 4:00 p.m. Central Daylight Time to discuss these results.
There will be a simultaneous webcast conducted at our website
http://www.buffalowildwings.com.
A replay of the call will be available until May 6, 2008. To
access this replay, please dial 303.590.3030, password 3870677.
About the Company
Buffalo Wild Wings, Inc., founded in 1982 and headquartered in
Minneapolis, Minnesota, is a growing owner, operator and franchisor of
restaurants featuring a variety of boldly-flavored, made-to-order menu
items including Buffalo-style chicken wings spun in one of 14
signature sauces. Buffalo Wild Wings is an inviting neighborhood
destination with widespread appeal and is the recipient of dozens of
"Best Wings" and "Best Sports Bar" awards from across the country.
There are currently 507 Buffalo Wild Wings locations across 37 states.
Forward-looking Statements
Certain statements in this release that are not historical facts,
including, without limitation, those relating to our projected unit,
revenue and earnings growth rates and future financial performance,
the number and timing of projected store openings, preopening
expenses, and the timing of closing the Las Vegas transaction are
forward-looking statements that involve risks and uncertainties. Such
statements are based upon the current beliefs and expectations of our
management. Actual results may vary materially from those contained in
forward-looking statements based on a number of factors including,
without limitation, the actual number of locations opening in the
future, the sales at these and our other company-owned and franchised
locations, the timing of closing of acquisitions, our ability to
successfully operate in new markets, the cost of commodities, the
success of our marketing and other initiatives, our ability to control
restaurant labor and other restaurant operating costs, the outcome and
impact of the Las Vegas transaction, economic conditions, competition,
the impact of applicable regulations, and other factors disclosed from
time to time in our filings with the U.S. Securities and Exchange
Commission. Investors should take such risks into account when making
investment decisions. Shareholders and other readers are cautioned not
to place undue reliance on these forward-looking statements, which
speak only as of the date on which they are made. We undertake no
obligation to update any forward-looking statements.
BUFFALO WILD WINGS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
(Dollar and share amounts in thousands except per share data)
(unaudited)
Three months ended
----------------------
March 30, April 1,
2008 2007
----------- ----------
Revenue:
Restaurant sales $ 86,896 71,059
Franchising royalties and fees 10,366 8,843
----------- ----------
Total revenue 97,262 79,902
----------- ----------
Costs and expenses:
Restaurant operating costs:
Cost of sales 26,415 22,058
Labor 25,858 21,107
Operating 13,275 11,472
Occupancy 5,697 4,718
Depreciation 5,239 3,892
General and administrative (1) 9,341 8,617
Preopening 1,185 318
Loss on asset disposals and impairment 753 79
----------- ----------
Total costs and expenses 87,763 72,261
----------- ----------
Income from operations 9,499 7,641
Interest income 432 700
----------- ----------
Earnings before income taxes 9,931 8,341
Income tax expense 3,406 2,800
----------- ----------
Net earnings 6,525 5,541
=========== ==========
Earnings per common share - basic $ 0.37 0.32
Earnings per common share - diluted 0.36 0.31
Weighted average share outstanding - basic 17,766 17,448
Weighted average share outstanding - diluted 17,877 17,684
(1) Contains stock-based compensation of $1,020 and $1,268
The following table expresses results of operations as a
percentage of total revenue for the periods presented, except for
restaurant operating costs which are expressed as a percentage of
restaurant sales:
Three months ended
-----------------------
March 30, April 1,
2008 2007
----------- ----------
Revenue:
Restaurant sales 89.3 88.9%
Franchising royalties and fees 10.7 11.1
----------- ----------
Total revenue 100.0 100.0
----------- ----------
Costs and expenses:
Restaurant operating costs:
Cost of sales 30.4 31.0
Labor 29.8 29.7
Operating 15.3 16.1
Occupancy 6.6 6.6
Depreciation 5.4 4.9
General and administrative 9.6 10.8
Preopening 1.2 0.4
Loss on asset disposals and impairment 0.8 0.1
----------- ----------
Total costs and expenses 90.2 90.4
----------- ----------
Income from operations 9.8 9.6
Interest income 0.4 0.9
----------- ----------
Earnings before income taxes 10.2 10.4
Income tax expense 3.5 3.5
----------- ----------
Net earnings 6.7% 6.9%
=========== ==========
BUFFALO WILD WINGS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
March 30, 2008 and December 30, 2007
(Dollar amounts in thousands)
March 30, December 30,
2008 2007
----------- ------------
Assets
Current assets:
Cash and cash equivalents $ 15,155 1,521
Marketable securities 57,930 66,513
Accounts receivable - franchisees, net of
allowance of $25 977 885
Accounts receivable - other 6,405 6,976
Inventory 2,622 2,362
Prepaid expenses 2,309 3,060
Refundable income tax 338 1,886
Deferred income taxes 1,611 1,303
----------- ------------
Total current assets 87,347 84,506
Property and equipment, net 108,702 102,742
Restricted cash 2,079 7,161
Other assets 2,297 2,320
Goodwill 369 369
----------- ------------
Total assets $ 200,794 197,098
=========== ============
Liabilities and Stockholders' Equity
Current liabilities:
Unearned franchise fees $ 2,448 2,316
Accounts payable 12,030 10,692
Accrued compensation and benefits 10,302 12,615
Accrued expenses 6,139 6,207
Current portion of deferred lease credits 282 660
----------- ------------
Total current liabilities 31,201 32,490
Long-term liabilities:
Other liabilities 1,100 1,031
Marketing fund payables 2,079 7,161
Deferred income taxes 3,741 2,166
Deferred lease credits, net of current
portion 12,973 12,585
----------- ------------
Total liabilities 51,094 55,433
Commitments and contingencies
Common stockholders' equity:
Undesignated stock, 1,000,000 shares
authorized -- --
Common stock, no par value. Authorized
20,200,000 shares; issued and outstanding
18,241,765 and 17,933,497, respectively 82,335 80,825
Retained earnings 67,365 60,840
----------- ------------
Total stockholders' equity 149,700 141,665
----------- ------------
Total liabilities and stockholders'
equity $ 200,794 197,098
=========== ============
BUFFALO WILD WINGS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOWS
(Dollar amounts in thousands)
(unaudited)
Three months ended
----------------------
March 30, April 1,
2008 2007
----------- ----------
Cash flows from operating activities:
Net earnings $ 6,525 5,541
Adjustments to reconcile net earnings to cash
provided by operations:
Depreciation 5,239 3,892
Amortization (36) 19
Loss on disposals and impairment 753 87
Deferred lease credits 834 302
Deferred income taxes 1,267 (762)
Stock-based compensation 1,020 1,268
Excess tax benefit from the exercise of
stock options (278) (585)
Change in operating assets and
liabilities:
Purchase of trading securities 1 (91)
Accounts receivable (345) (282)
Inventory (260) (248)
Prepaid expenses 751 (612)
Other assets 23 (24)
Unearned franchise fees 132 26
Accounts payable (219) 79
Income taxes 1,826 2,416
Accrued expenses (1,212) 273
----------- ----------
Net cash provided by operating
activities 16,021 11,299
----------- ----------
Cash flows from investing activities:
Acquisition of property and equipment (10,395) (3,904)
Purchase of marketable securities (27,704) (39,605)
Proceeds from marketable securities 36,322 34,693
----------- ----------
Net cash used in investing activities (1,777) (8,816)
----------- ----------
Cash flows from financing activities:
Issuance of common stock 101 441
Tax payments for restricted stock (989) (1,183)
Excess tax benefit from the exercise of stock
options 278 585
----------- ----------
Net cash used in financing activities (610) (157)
----------- ----------
Net increase in cash and cash equivalents 13,634 2,326
Cash and cash equivalents at beginning of
period 1,521 11,756
----------- ----------
Cash and cash equivalents at end of period $ 15,155 14,082
=========== ==========
BUFFALO WILD WINGS, INC. AND SUBSIDIARIES
Supplemental Information
Restaurant Count
Company-owned Restaurants:
Q1 Q2 Q3 Q4
-------- -------- -------- --------
2008 165
2007 140 145 148 161
2006 124 129 134 139
2005 106 110 116 122
2004 88 92 97 103
Franchised Restaurants:
Q1 Q2 Q3 Q4
-------- -------- -------- --------
2008 340
2007 299 301 313 332
2006 260 270 278 290
2005 212 224 234 248
2004 168 175 189 203
Same-Store Sales
Company-owned Restaurants:
Q1 Q2 Q3 Q4 Year
-------- -------- -------- -------- ----------
2008 4.1%
2007 8.7% 8.1% 8.3% 3.4% 6.9%
2006 7.7% 8.2% 11.8% 13.2% 10.4%
2005 6.1% 2.7% 1.8% 2.5% 3.2%
2004 11.1% 10.6% 9.9% 7.6% 9.7%
Franchised Restaurants:
Q1 Q2 Q3 Q4 Year
-------- -------- -------- -------- ----------
2008 2.1%
2007 3.3% 4.0% 5.9% 2.3% 3.9%
2006 6.7% 4.7% 6.4% 6.5% 6.1%
2005 3.2% 1.8% 1.1% 2.6% 2.2%
2004 12.0% 10.4% 5.7% 3.7% 7.6%
BUFFALO WILD WINGS, INC. AND SUBSIDIARIES
Supplemental Information
Average Weekly Sales Volumes
Company-owned Restaurants:
Q1 Q2 Q3 Q4 Year
------- ------ ------ ------ ------
2008 $41,438
2007 39,254 36,655 38,498 40,485 38,757
2006 35,857 33,660 35,380 38,800 36,033
2005 33,195 30,531 31,361 33,953 32,304
2004 32,289 30,248 30,983 33,038 31,663
Franchised Restaurants:
Q1 Q2 Q3 Q4 Year
------- ------ ------ ------ ------
2008 $47,812
2007 46,439 43,998 45,879 47,293 45,901
2006 44,342 42,338 42,963 46,008 43,975
2005 41,309 39,824 40,149 42,533 40,999
2004 39,678 38,072 38,727 40,926 39,402
CONTACT: Buffalo Wild Wings, Inc.
Investor Relations Contact:
Mary Twinem, 952-253-0731
or
Sally Smith, 952-253-0731
President and CEO
SOURCE: Buffalo Wild Wings, Inc.
