Champps (NASDAQ:CMPP)
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From Oct 2019 to Oct 2024
Champps Entertainment, Inc. (Nasdaq: CMPP) today
announced the closure of three restaurants as part of its ongoing
restaurant portfolio review and real estate rationalization efforts.
Two locations in Houston, Texas and one location in Toledo, Ohio
closed on May 1, 2006. The Toledo, Ohio location had only been open
since July 2005 while the two Houston locations have been open for
several years. None of the closure locations have ever been
profitable. This announcement follows the Company's January 10th, 2006
announcement that as many as five Champps locations were being
considered for closure. Decisions regarding the remaining two
locations have not been made.
Mike O'Donnell, Chairman and Chief Executive Officer, said, "The
closure of these three restaurants represents our ongoing commitment
to improving the Company's overall real estate mix and exiting
locations not meeting our operating cash flow objectives. We believe
the underperformance at these locations is a result of inefficient
site selection."
"We very much regret closing these locations, but in light of
their poor performance the cost of continuing operations does not
warrant remaining open at these three sites. We are committed to
serving our existing markets including our remaining location in
Houston."
Champps' has been evaluating its underperforming locations for
several months with the help of an outside consulting firm. The
ultimate decision to close these locations came after management
considered various factors including, without limitation, levels and
direction of revenues and cash flows, landlord negotiations, and other
exit cost considerations. Champps expects to recognize a non-cash
asset impairment charge in the third quarter of fiscal 2006 in
connection with the closure of these restaurants. Additionally, the
Company expects to ultimately spend $3 to $4 million net cash to exit
the closed locations.
About Champps Entertainment, Inc.
Champps Entertainment, Inc. owns and operates 50 and
franchises/licenses 13 Champps restaurants in 23 states. Champps,
which competes in the upscale casual dining segment, offers an
extensive menu consisting of freshly prepared food, coupled with
exceptional service. Champps creates an exciting environment through
the use of videos, music, sports and promotions.
Safe Harbor Statement
Certain statements made in this press release are forward-looking
statements based on management's current experience and expectations.
These forward-looking statements are made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995.
Such statements involve certain risks and uncertainties that could
cause actual results to differ materially from those in the
forward-looking statements. Such forward-looking statements include
statements regarding possible closing of restaurants, write-down of
assets, and cash exit costs, among others. Among the factors that
could cause future results to differ materially from those provided in
this press release are: the ability of the Company to operate
restaurants profitably, the ability to successfully close or
renegotiate lease terms for restaurants, the ability of the Company to
successfully implement our strategic initiatives to improve revenues
and profitability, the ability of the Company's management team to
implement strategic initiatives successfully; the impact of intense
competition in the casual dining restaurant industry, the Company's
ability to control restaurant operating costs, which are impacted by
commodity prices, minimum wage and other employment laws, fuel and
energy costs, consumer perceptions of food safety, changes in consumer
tastes and trends, and general business and economic conditions.
Information on significant potential risks and uncertainties that may
also cause such differences include, but are not limited to, those
mentioned by the Company from time to time in its filings with the
SEC. The words "may," "believe," "estimate," "expect," "plan,"
"intend," "project," "anticipate," "should" and similar expressions
and variations thereof identify certain of such forward-looking
statements, which speak only as of the dates on which they were made.
The Company undertakes no obligation to publicly update or revise any
forward-looking statements, whether as a result of new information,
future events, or otherwise. Readers are cautioned that any such
forward-looking statements are not guarantees of future performance
and involve risks and uncertainties, and, therefore, readers should
not place undue reliance on these forward-looking statements.