Smith & Wollensky (NASDAQ:SWRG)
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Smith & Wollensky Reports First Quarter Financial Results
NEW YORK, May 10 /PRNewswire-FirstCall/ -- The Smith & Wollensky Restaurant
Group, Inc. today announced financial results for the first quarter ended
March 29, 2004.
(Logo: http://www.newscom.com/cgi-bin/prnh/20020904/SWRGLOGO )
Total consolidated restaurant sales for the first quarter of 2004 were
approximately $30.7 million, a 20.9% increase from $25.4 million in the first
quarter of 2003. Comparable owned restaurant sales for the quarter rose 8.8%
from a year ago. Comparable owned restaurant sales include only units that
have been open for 15 months or longer. The net loss for the first quarter of
2004 was $70,000, or ($.01) per share. Net income for the first quarter of
2003 was $83,000, or $.01 per share.
The first quarter of both periods included substantial pre-opening expenses
related to the opening of a new Smith & Wollensky restaurant -- Houston in 2004
and Dallas in 2003. In addition, results for the first quarter of 2004
continue to be adversely affected by the extreme high cost of prime beef. It
should also be noted that pursuant to the Company's adoption of FIN 46
(Consolidation of Variable Interest Entities), results for the Maloney &
Porcelli restaurant previously reported as managed are now included in our
consolidated balance sheets and statements of operations for 2003 and 2004.
The Company also announced today that total restaurant sales for the first
fiscal month of the second quarter -- the four weeks ended April 26, 2004 --
were up 17.8% from the corresponding period of 2003. Comparable owned
restaurant sales for the month rose 9.9%, representing the 22nd consecutive
month of increased comparable sales.
Chairman and CEO Alan Stillman said, "We are pleased with the Company's
continued strong sales momentum in the first quarter, which clearly has carried
over into April. We also are seeing encouraging signs of further improvement
at our three owned restaurants in New York City, which generated sales
increases of 3.2% and 5.2% for the first quarter and April, respectively."
Mr. Stillman continued, "From an operating standpoint, the highlight of the
quarter was our successful opening in January of the new Smith & Wollensky in
Houston. Sales in Houston have exceeded our expectations to date. Construction
and other preparatory work continue on our next Smith & Wollensky location,
which is scheduled to open in Boston this fall. As we announced last week, the
Company and James M. Dunn, who had been our Company President, have agreed that
he will head up our Boston operations, providing us with strong, veteran
leadership at this key location."
Conference Call
Alan Stillman, Chairman & CEO, and Alan Mandel, CFO, will conduct a conference
call to review the Company's financial results for the first quarter ended
March 29, 2004 at 5:00 p.m. ET on May 10, 2004. Interested parties may listen
to the live call over the Internet via http://www.smithandwollensky.com/. To
listen to the live call please go to the website at least 15 minutes early to
register and to download and install any necessary audio software. If you are
unable to listen live, the conference call will also be archived on the website
listed above. An audio recording of the conference call, which may contain
material non-public information regarding the Company's results of operations
or financial condition for the first quarter of 2004, is expected to be posted
on the Company's website under the heading Investor Relations immediately
following the conference call.
About Smith & Wollensky Restaurant Group
The Smith & Wollensky Restaurant Group develops, owns and operates high-end,
high-volume restaurants in major cities across the United States. The original
Smith & Wollensky, a traditional New York steakhouse, opened in 1977 and is
currently believed to be the largest-grossing a la carte restaurant in the
country. Since its inception, the company has grown to include 17 restaurants,
including Smith & Wollensky in New York, Miami Beach, Chicago, New Orleans, Las
Vegas, Washington, D.C., Philadelphia, Columbus, Dallas and Houston. SWRG also
operates seven other restaurants in New York and Chicago, including Cite,
Maloney & Porcelli, Manhattan Ocean Club, Mrs. Park's Tavern, ONEc.p.s., Park
Avenue Cafe and The Post House.
Except for historical information contained herein, the statements made in this
press release regarding the Company's business, strategy and results of
operations are forward-looking statements which are based on management's
beliefs and information currently available to management. Readers are
cautioned not to put undue reliance on such forward-looking statements, which
are subject to a number of risks and uncertainties that could cause actual
results to differ materially from such statements. Factors that may cause such
differences include changes in economic conditions generally or in each of the
markets in which the Company is located, unanticipated changes in labor or food
costs, changes in consumer preferences, the level of competition in the
high-end segment of the restaurant industry and the success of the Company's
growth strategy. For a more detailed description of such factors, please see
the Company's filings with the Securities and Exchange Commission. The Company
disclaims any intention or obligation to update or revise any forward-looking
statements, whether as a result of new information, future events or otherwise.
THE SMITH & WOLLENSKY RESTAURANT GROUP, INC.
AND SUBSIDIARIES
Unaudited Consolidated Statements of Operations
(dollar amounts in thousands, except per share amounts)
Three Months Ended
March 29, March 31,
2004 2003
Restaurant sales $30,652 25,359
Total cost of restaurant sales 27,497 22,374
Income from restaurant operations 3,155 2,985
Management fee income 315 212
Income from owned and managed restaurants 3,470 3,197
General and administrative expenses 2,537 2,697
Royalty expense 442 348
Operating income 491 152
Interest expense (323) (126)
Amortization of deferred debt
financing costs (18) (13)
Interest income - 43
Interest expense, net (341) (96)
Income before provision for income taxes 150 56
Provision for income taxes 52 50
Income before interest in (income) loss of
consolidated variable interest entity 98 6
Interest in (income) loss of consolidated
variable interest entity (168) 77
Net income (loss) $(70) 83
Net income (loss) per common share:
Basic and diluted $(0.01) 0.01
Weighted average common shares outstanding:
Basic 9,376,249 9,354,266
Diluted 9,376,249 9,529,151
THE SMITH & WOLLENSKY RESTAURANT GROUP, INC.
AND SUBSIDIARIES
Consolidated Balance Sheets
(dollar amounts in thousands, except per share amounts)
March 29, December 29,
Assets 2004 2003
Current assets:
Cash and cash equivalents $1,352 2,181
Short-term investments 165 1,055
Accounts receivable, net 3,372 2,680
Merchandise inventory 4,832 4,749
Prepaid expenses and other current assets 1,315 845
Total current assets 11,036 11,510
Property and equipment, net 65,797 63,386
Goodwill, net 6,886 6,886
Licensing agreement, net 3,528 3,338
Other assets 4,351 3,941
Total assets $91,598 89,061
Liabilities and Stockholders' Equity
Current liabilities:
Current portion of long-term debt $2,109 2,121
Accounts payable and accrued expenses 12,763 11,922
Total current liabilities 14,872 14,043
Obligations under capital lease 10,028 9,991
Long-term debt, net of current portion 7,678 6,099
Deferred rent 6,441 6,400
Total liabilities 39,019 36,533
Interest in consolidated variable
interest entity (1,592) (1,680)
Stockholders' equity:
Common stock (par value $.01; authorized
40,000,000 shares; 9,376,249 shares
issued and outstanding at March 29, 2004
and December 29, 2003, respectively) 94 94
Additional paid-in capital 69,940 69,940
Accumulated deficit (15,912) (15,842)
Accumulated other comprehensive income 49 16
54,171 54,208
Total liabilities and
stockholders' equity $91,598 89,061
http://www.newscom.com/cgi-bin/prnh/20020904/SWRGLOGODATASOURCE: The Smith &
Wollensky Restaurant Group, Inc.
CONTACT: Investors: Lauren Felice of RFBinder Partners,
+1-212-994-7541, , for The Smith & Wollensky
Restaurant Group, Inc.
Web site: http://www.smithandwollensky.com/