Dave & Busters (NYSE:DAB)
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Dave & Buster's, Inc. (NYSE:DAB), a leading operator of
upscale restaurant/entertainment complexes, today announced earnings
for its first quarter ended May 1, 2005.
Total revenue for the first quarter increased 21.9 percent, or
$20.8 million, to $115.7 million from $95.0 million in the prior
year's comparable quarter. Food and beverage revenue increased 25.2
percent and amusement and other revenue increased 18.3 percent.
Revenue from comparable stores decreased 1.7 percent for the quarter.
Operating income for the period increased 29.2 percent to $9.0 million
compared to $6.9 million last year. EBITDA increased to $18.7 million,
or 23.4 percent, from $15.2 million last year. Net income for the
quarter was $4.6 million, or $0.30 per diluted share, compared to net
income in the same period last year of $3.6 million, or $0.25 per
diluted share.
"We are pleased with our substantial increase in earnings. These
results mark our ninth consecutive quarter of year-over-year
profitability improvement," stated Buster Corley, the company's CEO.
"While making sustained progress in overall profitability, we remain
focused on same store sales improvement. We believe we have the
appropriate strategy in place to accomplish this later in the year."
"There were costs associated with the Jillian's integration which
we expect to be non-recurring," stated W. C. Hammett, the company's
CFO. "These costs include items such as training labor and additional
food costs related to the new menu roll-out, higher than normal
freight costs related to game and equipment transfers and severance
and related management relocation costs. We estimate that the impact
on total operating expenses for the quarter was approximately $1.0
million."
Non-GAAP Financial Measures
A reconciliation of EBITDA to net income, the most directly
comparable financial measure presented in accordance with GAAP, is set
forth in the attachment to this release.
The Company will hold a conference call to discuss first quarter
results on Tuesday, June 7, 2005, at 11:30 a.m. Eastern Time (10:30
a.m. Central Time). The company plans to release earnings the same day
before the market opens.
The call will be Webcast by both CCBN and Vcall and can be
accessed at Dave & Buster's Web site, www.daveandbusters.com.
Individual investors can listen to the call through CCBN's individual
investor center, www.companyboardroom.com, or PrecisionIR's Webcast
site, www.vcall.com. In addition, investors can access the call by
visiting any of the investor sites in the CCBN or PrecisionIR
Individual Investor Network. Institutional investors can access the
call via CCBN's password-protected event management site,
www.streetevents.com.
The Webcast will be archived on the company's Web site and
available for replay through June 21, 2005.
Celebrating over 22 years of operations, Dave & Buster's was
founded in 1982 and is one of the country's leading upscale,
restaurant/entertainment concepts with 43 locations throughout the
United States and in Canada. More information on the company,
including the latest investor presentation is available on the
company's Website, www.daveandbusters.com.
"Safe Harbor" Statements Under the Private Securities Litigation
Reform Act of 1995
Certain information contained in this press release includes
forward-looking statements. Forward-looking statements include
statements regarding our expectations, beliefs, intentions, plans,
projections, objectives, goals, strategies, future events or
performance and underlying assumptions and other statements which are
other than statements of historical facts. These statements may be
identified, without limitations, by the use of forward-looking
terminology such as "may," "will," "anticipates," "expects,"
"projects," "believes," "intends," "should," or comparable terms or
the negative thereof. All forward-looking statements included in this
press release are based on information available to us on the date
hereof. Such statements speak only as of the date hereof. These
statements involve risks and uncertainties that could cause actual
results to differ materially from those described in the statements.
These risks and uncertainties include, but are not limited to, the
following: our ability to open new high-volume
restaurant/entertainment complexes; our ability to raise and access
sufficient capital in the future; changes in consumer preferences,
general economic conditions or consumer discretionary spending; the
outbreak or continuation of war or other hostilities involving the
United States; potential fluctuation in our quarterly operating result
due to seasonality and other factors; the continued service of key
management personnel; our ability to attract, motivate and retain
qualified personnel; the impact of federal, state or local government
regulations relating to our personnel or the sale of food or alcoholic
beverages; the impact of litigation; the effect of competition in our
industry; additional costs associated with compliance with the
Sarbanes-Oxley Act and related regulations and requirements; and other
risk factors described from time to time in our reports filed with the
SEC.
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Dave & Buster's, Inc.
Consolidated Statements of Income
(dollars in thousands, except per share amounts)
(unaudited)
13 Weeks Ended 13 Weeks Ended
May 1, 2005 May 2, 2004
--------------- ---------------
(as restated)
Food and beverage revenue $ 61,392 53.0% $49,021 51.6%
Amusement and other revenues 54,343 47.0% 45,945 48.4%
------- ------- -------- ------
Total revenues 115,735 100.0% 94,966 100.0%
Cost of food and beverage 15,191 13.1% 12,189 12.9%
Cost of amusement and other 5,816 5.1% 5,532 5.8%
------- ------- -------- ------
Total cost of product 21,007 18.2% 17,721 18.7%
Operating payroll and
benefits 32,725 28.3% 26,928 28.4%
Other store operating
expenses 35,536 30.7% 28,868 30.4%
General and administrative
expenses 7,692 6.6% 6,299 6.6%
Depreciation and
amortization expense 9,741 8.4% 8,220 8.7%
Preopening costs 78 0.1% - 0.0%
------- ------- -------- ------
Total operating expenses 106,779 92.3% 88,036 92.7%
Operating income 8,956 7.7% 6,930 7.3%
Interest expense, net 1,773 1.5% 1,478 1.6%
------- ------- -------- ------
Income before provision for
income taxes 7,183 6.2% 5,452 5.7%
Provision for income taxes 2,622 2.3% 1,852 2.0%
------- ------- -------- ------
Net income $ 4,561 3.9% $ 3,600 3.8%
======= ======= ======== ======
Net income per share
Basic $ 0.34 $ 0.27
Diluted $ 0.30 $ 0.25
Weighted average shares
outstanding
Basic weighted average
shares outstanding 13,472 13,205
Diluted weighted average
shares outstanding 16,576 16,192
Other information
Company operated stores
open 43 33
EBITDA, which is earnings before interest, taxes, depreciation and
amortization, is used by management, bankers and investors to evaluate
a company's ability to repay debt and for compliance of certain debt
covenants.
Net income $ 4,561 $ 3,600
Add back: depreciation
& amortization 9,741 8,220
interest
expense, net 1,773 1,478
provision for
income taxes 2,622 1,852
-------- ---------
EBITDA $18,697 $15,150
Dave & Buster's Inc.
Condensed Consolidated Balance Sheets
(in thousands)
(unaudited)
May 1, 2005 Jan. 30,2005
------------- -------------
Current assets
Cash and cash equivalents $ 5,177 $ 7,624
Other current assets 37,126 34,581
------------- -------------
Total current assets 42,303 42,205
Property and equipment, net 332,111 331,478
Other assets and deferred charges 23,057 23,725
------------- -------------
$397,471 $397,408
------------- -------------
LIABILITIES AND STOCKHOLDER'S EQUITY
Total current liabilities $ 47,627 $ 49,861
Other long-term liabilities 73,036 70,251
Long-term debt 74,604 80,351
Stockholder's equity
Common stock 135 135
Paid in capital 122,723 122,173
Restricted stock awards 1,632 1,454
Accumulated comprehensive income 195 225
Retained earnings 79,365 74,804
------------- -------------
204,050 198,791
Less: Treasury stock 1,846 1,846
------------- -------------
Total stockholders' equity 202,204 196,945
$397,471 $397,408
------------- -------------
Dave & Buster's, Inc.
Consolidated Statements Of Cash Flows
(in thousands)
(unaudited)
13 Weeks Ended 13 Weeks Ended
May 1, 2005 May 2, 2004
-------------- --------------
(as restated)
Cash flows from operating activities:
Net Income $ 4,561 $ 3,600
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation and amortization 9,741 8,220
Deferred income tax benefit (166) (152)
Tax benefit related to stock
options 165 140
Restricted stock awards 178 81
Warrants related to convertible
debt 63 63
Other, net (36) (14)
Changes in operating assets and
liabilities
Inventories 280 (700)
Prepaid expenses (891) (1,960)
Other current assets (1,934) 899
Other assets and deferred charges 1,150 246
Accounts payable (385) (847)
Accrued liabilities 825 878
Income taxes payable (2,967) (905)
Deferred rent liability 1,064 (240)
Other liabilities 1,721 (42)
-------------- --------------
Net cash provided by operating
activities 13,369 9,267
Cash flows from investing activities:
Capital expenditures (10,866) (7,067)
Proceeds from sales of property
and equipment 17 325
-------------- --------------
Net cash used in investing
activities (10,849) (6,742)
Cash flows from financing activities:
Borrowings under long-term debt - 1,500
Repayments of long-term debt (5,352) (2,833)
Proceeds from exercises of stock
options 385 761
-------------- --------------
Net cash used in financing
activities (4,967) (572)
-------------- --------------
Increase (decrease) in cash and cash
equivalents (2,447) 1,953
Beginning cash and cash equivalents 7,624 3,897
-------------- --------------
Ending cash and cash equivalents $ 5,177 $ 5,850
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