Ruby Tuesday, Inc. Reports Third Quarter Results

Ruby Tuesday, Inc. Reports Third Quarter Results
- DILUTED EARNINGS PER SHARE INCREASED 23% - COMPANY-OWNED RUBY TUESDAY
SAME-STORE SALES INCREASED 4.1% - DOMESTIC FRANCHISE SAME-STORE SALES INCREASED
6.8% 


MARYVILLE, Tenn., April 6  /PRNewswire-FirstCall/ -- Ruby Tuesday, Inc. today
reported results for its third quarter of fiscal 2004, which ended March 2,
2004.  For the quarter, diluted earnings per share increased 23.1% to $0.48,
while net income increased 27.6% to $32.4 million.  Total operating revenues
increased 16.4% to $271.0 million, and pre-tax profit margin increased 190 basis
points to 18.6%. Same-store sales at Company-owned Ruby Tuesday restaurants
increased 4.1%, while same-store sales at domestic franchise restaurants
(including restaurants owned by businesses in which the Company holds an equity
interest as well as restaurants owned by traditional franchisees) increased 6.8%
during the quarter.

Highlights for the third quarter, compared with the same periodof the prior
year, are shown below:

                                        3Q fiscal 2004    3Q fiscal 2003
   Diluted earnings per share                 $0.48            $0.39
   Company-owned same-store sales change       4.1%            (0.4%)
   Company-owned average unit
    volume increase                            4.8%            (0.8%)
   Total operating revenues            $270,965,000     $232,856,000
   Pre-tax margins                            18.6%            16.7%



"To-go" sales accounted for 6.0% of the Company's sales at its Company- owned
freestanding restaurants during the Company's February period.  The "curb-side
to-go(SM)" program has been in place at both Company-owned and franchise
restaurants since the Company's secondfiscal quarter of this year.

Phase one of the "Ruby Tuesday Smart Eating(SM)" initiative rolled out in
November, 2003 and has been very well received by the Company's guests based on
research performed.  As previously announced, phase two of Smart Eating, which
is scheduled to be rolled out in late April, will include nutritional
information, such as calories, fat grams, net carbohydrate grams and fiber grams
for all menu items.  The Company is taking an industry-leading role in this area
and plans to leverage this leadership position going forward.

Sandy Beall, the Company's Chairman and Chief Executive Officer, commented, "We
are excited about our recent performance and very excited about our plans going
forward.  We have received increasingly positive feedback on our Smart Eating
menu -- both phase one, which rolled out in the fall, as well as phase two,
which has been in test since late February.  In addition to focusing on setting
ourselves apart from the competition in terms of service, standards, people and
facilities, we believe that by providing unparalleled nutritional information,
our Smart Eating initiative creates a tremendous opportunity for the Ruby
Tuesday brand.  It is clear Americans want to know more about what they are
eating, and we are going to provide that information so they can make more
informed choices.  We believe providing information on items such as calories,
fat, carbohydrates, and fiber in a clear and concise manner on our menus will be
another step towards distinguishing Ruby Tuesday from our competition.  Our
customers have told us they want this information, and we intend to provide it
to them."

Fiscal 2004 Guidance

For the fourth quarter of fiscal 2004, the Company's goal for diluted earnings
per share growth is 17-18%, based on the Company's projected same- store sales
growth of 2.4% at Company-owned Ruby Tuesday restaurants.  The Company's goal
for fiscal 2004 diluted earnings per share growth is approximately 20%, based on
same-store sales growth of approximately 2.5% at Company-owned Ruby Tuesday
restaurants for the year.

Fiscal 2005 Guidance

For fiscal 2005, the Company's goal for diluted earnings per share growth is
15.0-18.0%.  This is based on the same-store sales growth of 2.0-3.0% at
Company-owned and domestic franchise Ruby Tuesday restaurants.  The Company
anticipates 50-55 Company-owned restaurant openings during fiscal 2005, and
anticipates its franchisees will open approximately 40 Ruby Tuesday restaurants
during the same period.  Additionally, the Company anticipates reinstating share
repurchases as a means of returning excess capital to its shareholders.  Five
million shares remain authorized for share repurchase under the existing Board
approved program.

  Additional Third Quarter Highlights:
  - Diluted earnings per share increased 23.1% to $0.48 from $0.39.
  - Net income increased 27.6% to $32,405,000 from $25,392,000.
  - Sales at franchise (including franchise partnership and traditional
    franchise) Ruby Tuesdayrestaurants (which is the basis for determining
    royalty fees included in franchise income on the Company's income
    statement) totaled $122,735,000 and $100,202,000 for the third quarter
    of fiscal 2004 and fiscal 2003, respectively.
  - Nine Company-owned Ruby Tuesday restaurants were opened and one was
    closed due to normal lease expiration.
  - Ten franchise restaurants were opened and two were closed (one due to
    lease expiration).

  Year-to-Date Highlights:
  - Diluted earnings per share increased 21.6% to $1.18 from $0.97.
  - Net income increased 25.0% to $78,960,000 from $63,166,000.
  - Sales at franchise (including franchise partnership and traditional
    franchise) Ruby Tuesday restaurants (which is the basis for determining
    royalty fees included in franchise income on the Company's income
    statement) totaled $329,687,000 and $285,536,000 for the third quarter
    year-to-date of fiscal 2004 and fiscal 2003, respectively.
  - The Company exercised its right to acquire an additional 49% interest in
    four of the franchisees during the year.  As of March 2, 2004, the
    Company held a 50% interest in thirteen franchisees collectively
    operating 134 Ruby Tuesday restaurants.



Ruby Tuesday, Inc. has Company-owned, and/or franchise Ruby Tuesday brand
restaurants in 39 states, the District of Columbia, Puerto Rico, Hawaii and 13
foreign countries.  As of March 2, 2004, the Company owned and operated 474 Ruby
Tuesday restaurants, while domestic and international franchisees operated 210
and 34 locations, respectively.  Ruby Tuesday, Inc. is traded on the New York
Stock Exchange (Symbol: RI).

The Company will host a conference call which will be a live web-cast tomorrow
morning at 8:30 Eastern Time.   Thecall will be available live at the following
websites:

  http://www.fulldisclosure.com/
  http://www.rubytuesday.com/



The call will be archived on both sites through the close of business on April
14, 2004.

Special Note Regarding Forward-Looking Information

This press release contains various "forward-looking statements" which represent
the Company's expectations or beliefs concerning future events, including the
following:  future financial performance and unit growth (both Company-owned and
franchised), future capital expenditures, future borrowings and repayment of
debt, and payment of dividends. The Company cautions that a number of important
factors could, individually or in the aggregate, cause actual results to differ
materially from those included in the forward-looking statements, including,
without limitation, the following:  consumer spending trends and habits;
mall-traffic trends; increased competition in the casual dining restaurant
market; weather conditions in the regions in which Company- owned and franchised
restaurants are operated; consumers' acceptance of the Company's development
prototypes; laws and regulations affecting labor and employee benefit costs;
costs and availability of food and beverage inventory; the Company's ability to
attract qualified managers, franchisees and team members; changes in the
availability of capital; impact of  adoption of new accounting standards; and
general economic conditions.

  RUBY TUESDAY, INC.

  Financial Results For the ThirdQuarter of Fiscal Year 2004
  (Amounts in thousands except per share amounts)

                                   13 Weeks         13 Weeks
                                    Ended   Percent  Ended    Percent
                                    March 2,  of     March 4,   of   Percent
                                     2004    Sales    2003     Sales  Change

  Revenues:
     Restaurant sales and operating
      revenues                      $266,438   98.3  $228,834   98.3
     Franchise revenues4,527    1.7     4,022    1.7
        Total operating revenues     270,965  100.0   232,856  100.0  16.4

  Operating Costs and Expenses:
     (as a percent of Company
      restaurant revenues)
         Cost of merchandise          67,419   25.3    60,846   26.6
         Payroll and related costs    81,909   30.7    73,991   32.3
         Other restaurant operating
          costs                       43,666   16.4    36,900   16.1
         Depreciation and
          amortization    13,907    5.2    11,744    5.1
     (as a percent of Total
      operating revenues)
         Selling, general and
          administrative, net         15,594    5.8    11,000    4.7
         Equity in (earnings) of
          unconsolidatedfranchises   (2,610)  (1.0)   (1,534)  (0.7)
  Total operating costs and
   expenses                          219,885          192,947

  Earnings before Interest and
   Taxes                              51,080   18.9    39,909   17.1  28.0

     Interest expense, net               773    0.3       964    0.4

  Pre-tax Profit                      50,307   18.6    38,945   16.7

     Provision for income taxes       17,902    6.6    13,553    5.8

  Net Income                         $32,405   12.0 $25,392   10.9  27.6

  Earnings Per Share:
  Basic                                $0.49            $0.40         22.5
  Diluted                              $0.48            $0.39         23.1

  Shares:
  Basic                               65,914  64,056
  Diluted                             67,614           65,050


  RUBY TUESDAY, INC.

  Financial Results For the Third Quarter of Fiscal Year 2004
  (Amounts in thousands except per share amounts)

                                   39 Weeks         39 Weeks
                                    Ended   Percent  Ended    Percent
                                    March 2,  of     March 4,   of   Percent
                                     2004    Sales    2003     Sales  Change

  Revenues:
     Restaurant sales and operating
      revenues                      $753,178   98.3  $655,601   98.3
     Franchise revenues               12,643    1.7    11,270    1.7
        Total operating revenues     765,821  100.0   666,871  100.0   14.8

  Operating Costs and Expenses:
     (as a percent of Company
      restaurant revenues)
         Cost of merchandise         193,015   25.6   175,159   26.7
         Payroll and related costs   237,487   31.5   219,255   33.4
         Other restaurant operating
          costs                      126,488   16.8   110,825   16.9
         Depreciation and
          amortization                40,109    5.3    33,347    5.1
     (as a percent of Total
      operating revenues)
         Selling, general and
          administrative, net         46,710    6.1    32,361    4.9
         Equity in (earnings) of
          unconsolidated franchises   (3,879)  (0.5)   (2,410)  (0.4)
  Total operating costs and
   expenses                          639,930          568,537

  Earnings before Interest and
   Taxes                             125,891   16.4    98,334   14.7   28.0

     Interest expense, net             3,288    0.4     1,455    0.2

  Pre-tax Profit                     122,603   16.0    96,879   14.5

     Provision for income taxes       43,643    5.7    33,713    5.1

  Net Income                         $78,960   10.3   $63,166    9.5   25.0

  Earnings Per Share:
  Basic                                $1.21            $0.99        22.2
  Diluted                              $1.18            $0.97          21.6

  Shares:
  Basic                               65,322           63,915
  Diluted                             66,889           65,017


  RUBY TUESDAY, INC.

  FinancialResults For the Third Quarter
  of Fiscal Year 2004
  (Amounts in thousands)

                                              March 2,         June 3,
  CONDENSED BALANCE SHEETS                      2004             2003
  Assets
     Cash and Short-TermInvestments          $18,430           $8,662
     Accounts and Notes Receivable             17,486 *         10,509
     Inventories                               13,445           12,200
     Deferred Income Taxes                      3,062           2,609
     Income Tax Receivable                      5,396            2,485
     Prepaid Rent                               2,142            2,136
     Assets Held for Disposal                   2,674            5,217
     Other Current Assets        5,834            6,099

       Total Current Assets                    68,469           49,917

     Property and Equipment, Net              731,275          660,897
     Goodwill, Net                              7,845            7,845
Notes Receivable, Net                     35,587           39,827
     Other Assets                              59,963           46,035

       Total Assets                          $903,139         $804,521

  Liabilities
     Current Liabilities$90,520          $81,321
     Long-Term Debt                           165,916          207,064
     Deferred Income Taxes                     43,468           32,081
     Other Deferred Liabilities                76,984           69,527

       Total Liabilities                      376,888          389,993

  Shareholders' Equity                        526,251          414,528

       Total Liabilities and
         Shareholders' Equity                $903,139         $804,521

*  Includes $6,090 of stock option exercises yet to be settled by the
     broker as of March 2, 2004.
     All settlements were received within one week of the end of the
     quarter.


DATASOURCE: Ruby Tuesday, Inc.



CONTACT:  Price Cooper of Ruby Tuesday, Inc., [phone]



Web site:  http://www.rubytuesday.com/ 

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