EXHIBIT 99.1
Fox & Hound Restaurant Group Reports Financial Results for the Fiscal Quarter Ended June 14, 2005
WICHITA, Kan., July 7, 2005 (PRIMEZONE) -- Fox & Hound Restaurant Group (Nasdaq:FOXX) announced record revenues for the twelve week second quarter ended June 14, 2005.
Highlights for the twelve week second quarter ended June 14, 2005 compared to the twelve week second quarter ended June 15, 2004:
-- Total revenues increased 15.1% to $35,842,000 -- Net income was $1,065,000 versus a net loss of $855,000 -- An asset impairment charge of $2,523,000 ($1,766,000 net of tax or $0.18 per share) was taken during last year's second quarter -- Net income excluding the asset impairment charge was $1,065,000 versus $911,000 -- Diluted earnings per share was $0.10 versus a diluted loss per share of $0.09 -- Diluted earnings per share excluding the asset impairment charge was $0.10 versus $0.09 -- Comparable store sales decreased 0.9% -- Three (3) new units were opened
Highlights for the twenty-four week period ended June 14, 2005 compared to the twenty-four week period ended June 15, 2004:
-- Total revenues increased 15.7% to $75,197,000 -- Net income was $4,053,000 versus $1,786,000 -- An asset impairment charge of $2,523,000 ($1,766,000 net of tax or $0.17 per share) was taken during last year's second quarter -- Net income excluding the asset impairment charge was $4,053,000 versus $3,552,000 -- Diluted earnings per share was $0.39 versus $0.17 -- Diluted earnings per share excluding the asset impairment charge was $0.39 versus $0.34 -- Comparable store sales decreased 0.1% -- Five (5) new units were opened
Steve Johnson, chief executive officer, stated, "We were pleased to report sales and earnings which met the guidance given on our previous conference call."
During the second quarter, the Company opened three (3) new restaurants -- St. Louis, MO; Wilmington, NC; and Birmingham, AL. Two (2) additional units were opened after the end of the second quarter in Germantown, MD and Louisville, KY, bringing the number of restaurants opened in 2005 to seven (7). The Company expects to open 10-12 new restaurants in fiscal 2005. One (1) unit is under construction, contracts have been executed on three (3) more sites, and negotiations have begun on six (6) additional sites.
The Company currently operates 82 restaurants under the "Fox and Hound" and "Bailey's" brand names that each provide a social gathering place offering high quality food, drinks and entertainment in an upscale, casual environment.
Chief Executive Officer, Steven M. Johnson, and Chief Financial Officer, James K. Zielke, will host a conference call at Friday, July 8, 2005 at 10:00 a.m. EDT. The call in number is 1-800-988-9506, and the confirmation code is "FOXX". A recorded replay of the conference call will be available beginning July 8, 2005 through July 22, 2005. The replay call in number is 1-800-272-5921.
This press release contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which are intended to be covered by the safe harbors created thereby. Although the Company believes that the assumptions underlying the forward-looking statements contained herein are reasonable, any of the assumptions could be inaccurate, and, therefore, there can be no assurance that the forward-looking statements included in this report will prove to be accurate. Our actual results may differ materially from the forward-looking statements contained herein. Factors that could cause actual results to differ from the results discussed in the forward-looking statements include, but are not limited to, potential increases in food, alcohol, labor, and other operating costs, changes in competition, the inability to find suitable new locations, changes in consumer preferences or spending patterns, changes in demographic trends, the effectiveness of our operating and growth initiatives and promotional efforts, and changes in government regulation. Further information about the factors that might affect the Company's financial and other results are included in the Company's 10-K and 10-Q, filed with the Securities and Exchange Commission. In light of the significant uncertainties inherent in the forward-looking statements included herein, the inclusion of such information should not be regarded as a representation by the Company or any other person that the objectives and plans of the Company will be achieved.
Fox & Hound Restaurant Group Unaudited Summary Financial Data ($ in thousands except per share amount Condensed Income Statements For the twelve weeks ended (Restated) June 14, 2005 June 15, 2004 ----------------- ----------------- $ % $ % ----------------- ----------------- Food and beverage $ 33,752 94.2 $ 29,021 93.2 Entertainment and other 2,090 5.8 2,120 6.8 -------- -------- -------- -------- Total net sales 35,842 100.0 31,141 100.0 Costs and expenses: Costs of sales 9,699 27.1 8,616 27.7 Restaurant operating expenses 19,945 55.6 16,995 54.6 Depreciation and amortization 2,163 6.0 1,802 5.8 Preopening costs 560 1.6 638 2.0 Asset Impairment -- -- 2,523 8.1 -------- -------- -------- -------- Restaurant costs and expenses 32,367 90.3 30,574 98.2 -------- -------- -------- -------- Restaurant operating income 3,475 9.7 567 1.8 General and administrative expenses 2,007 5.6 1,749 5.6 Gain on disposal of assets 25 0.1 -- -- -------- -------- -------- -------- Income from operations 1,493 4.2 (1,182) (3.8) Other income/expense: Other income/(expense) 15 -- -- -- Interest expense (33) (0.1) (44) (0.1) -------- -------- -------- -------- Income before income taxes 1,475 4.1 (1,226) (3.9) Income tax expense 410 1.1 (371) (1.2) -------- -------- -------- -------- Net income $ 1,065 3.0 $ (855) (2.7) ======== ======== ======== ======== Earnings per share: Basic $ 0.11 $ (0.09) Diluted $ 0.10 $ (0.09) Shares used in computing earnings per share (in thousands): Basic 9,997 9,889 Diluted 10,420 9,889 Restaurants open at end of period 80 69 Comparable sales growth (0.9)% (0.2)% Analysis of Components of Net Income and Earnings per Share Amounts ------------------------------------------------------------------- Net earnings excluding asset impairment $ 1,065 $ 911 Provision for asset impairment, net of tax -- (1,766) -------- -------- Net income (loss) $ 1,065 $ (855) ======== ======== Diluted earnings (loss) per share: Net earnings excluding asset impairment $ 0.10 $ 0.09 Provision for asset impairment, net of tax -- (0.18) Net income (loss) $ 0.10 $ (0.09) ======== ======== Condensed Income Statements For the twenty-four weeks ended (Restated) June 14, 2005 June 15, 2004 ----------------- ----------------- $ % $ % ----------------- ----------------- Food and beverage $ 70,826 94.2 $ 60,442 93.0 Entertainment and other 4,371 5.8 4,546 7.0 -------- -------- -------- -------- Total net sales 75,197 100.0 64,988 100.0 Costs and expenses: Costs of sales 20,101 26.7 17,732 27.3 Restaurant operating expenses 39,949 53.1 33,978 52.3 Depreciation and amortization 4,259 5.7 3,537 5.4 Preopening costs 953 1.3 1,070 1.6 Asset Impairment -- -- 2,523 3.9 -------- -------- -------- -------- Restaurant costs and expenses 65,262 86.8 58,840 90.5 -------- -------- -------- -------- Restaurant operating income 9,935 13.2 6,148 9.5 General and administrative expenses 4,025 5.3 3,494 5.4 Gain on disposal of assets 25 -- -- -- -------- -------- -------- -------- Income from operations 5,935 7.9 2,654 4.1 Other income/expense: Other income/(expense) 15 -- 3 -- Interest expense (82) (0.1) (96) (0.1) -------- -------- -------- -------- Income before income taxes 5,868 7.8 2,561 4.0 Income tax expense 1,815 2.4 775 1.2 -------- -------- -------- -------- Net income $ 4,053 5.4 $ 1,786 2.8 ======== ======== ======== ======== Earnings per share: Basic $ 0.41 $ 0.18 Diluted $ 0.39 $ 0.17 Shares used in computing earnings per share (in thousands): Basic 9,979 9,870 Diluted 10,397 10,465 Restaurants open at end of period 80 69 Comparable sales growth (0.1)% 0.8% Analysis of Components of Net Income and Earnings per Share Amounts ------------------------------------------------------------------- Net earnings excluding asset impairment $ 4,053 $ 3,552 Provision for asset impairment, net of tax -- (1,766) -------- -------- Net income (loss) $ 4,053 $ 1,786 ======== ======== Diluted earnings (loss) per share: Net earnings excluding asset impairment $ 0.39 $ 0.34 Provision for asset impairment, net of tax -- (0.17) -------- -------- Net income (loss) $ 0.39 $ 0.17 ======== ======== Fox & Hound Restaurant Group Unaudited Summary Financial Data ($ in thousands except per share amounts) Reconciliation of Restated Income Statements -------------------------------------------- For the twelve weeks ended June 15, 2004 As originally Adjustment As restated reported ------------------ -------- ------------------ $ % $ $ % -------- -------- -------- -------- -------- Food and beverage $ 29,021 93.2 $ -- $ 29,021 93.2 Entertainment and other 2,120 6.8 -- 2,120 6.8 -------- -------- -------- -------- -------- Total net sales 31,141 100.0 -- 31,141 100.0 Costs and expenses: Costs of sales 8,616 27.7 -- 8,616 27.7 Restaurant operating expenses 16,998 54.6 (3) 16,995 54.6 Depreciation and amortization 1,554 4.9 248 1,802 5.8 Preopening costs 638 2.0 - 638 2.0 Asset Impairment 2,365 7.6 158 2,523 8.1 -------- -------- -------- -------- -------- Restaurant costs and expenses 30,171 96.8 403 30,574 98.2 -------- -------- -------- -------- -------- Restaurant operating income 970 3.2 (403) 567 1.8 General and administrative expenses 1,749 5.5 -- 1,749 5.6 Gain on disposal of assets -- -- -- -- -- -------- -------- -------- -------- -------- Income from operations (779) (2.3) (403) (1,182) (3.8) Other income/expense: Other income/(expense) -- -- -- -- -- Interest expense (27) (0.1) (17) (44) (0.1) -------- -------- -------- -------- -------- Income before income taxes (806) (2.4) (420) (1,226) (3.9) Income tax expense (290) (0.9) (81) (371) (1.2) -------- -------- -------- -------- -------- Net income $ (516) (1.5) $ (339) $ (855) (2.7) ======== ======== ======== ======== ======== Earnings per share: Basic $ (0.05) $ (0.04) $ (0.09) Diluted $ (0.05) $ (0.04) $ (0.09) Reconciliation of Restated Income Statements -------------------------------------------- For the twenty-four weeks ended June 15, 2004 As originally Adjustment As restated reported ------------------ -------- ------------------ $ % $ $ % -------- -------- -------- -------- -------- Food and beverage $ 60,442 93.0 $ -- $ 60,442 93.0 Entertainment and other 4,546 7.0 -- 4,546 7.0 -------- -------- -------- -------- -------- Total net sales 64,988 100.0 -- 64,988 100.0 Costs and expenses: Costs of sales 17,732 27.3 -- 17,732 27.3 Restaurant operating expenses 33,970 52.3 8 33,978 52.3 Depreciation and amortization 3,058 4.7 479 3,537 5.4 Preopening costs 1,070 1.6 -- 1,070 1.6 Asset Impairment 2,365 3.6 158 2,523 3.9 -------- -------- -------- -------- -------- Restaurant costs and expenses 58,195 89.5 645 58,840 90.5 -------- -------- -------- -------- -------- Restaurant operating income 6,793 10.5 (645) 6,148 9.5 General and administrative expenses 3,494 5.5 -- 3,494 5.4 Gain on disposal of assets -- -- -- -- -- -------- -------- -------- -------- -------- Income from operations 3,299 5.0 (645) 2,654 4.1 Other income/expens: Other income/(expense) 3 -- -- 3 -- Interest expense (62) (0.1) (34) (96) (0.1) -------- -------- -------- -------- -------- Income before income taxes 3,240 4.9 (679) 2,561 4.0 Income tax expense 1,082 1.7 (307) 775 1.2 -------- -------- -------- -------- -------- Net income $ 2,158 3.2 $ (372) $ 1,786 2.8 ======== ======== ======== ======== ======== Earnings per share: Basic $ 0.22 $ (0.04) $ 0.18 Diluted $ 0.21 $ (0.04) $ 0.17 Condensed Balance Sheets Jun. 14, Dec. 28, 2005 2004 -------- -------- Current assets: Cash $ 644 $ 812 Other current assets 5,255 6,093 -------- -------- 5,899 6,905 Property and equipment, net 76,147 68,381 Intangibles and other assets 5,023 5,281 -------- -------- $ 87,069 $ 80,567 ======== ======== Current liabilities: Current portion of capital leases $ 8 $ 8 Other current liabilities 15,876 13,133 -------- -------- 15,884 13,141 Notes payable 2,510 3,680 Obligations under capital lease, net of current portion 885 889 Accrued Rent 8,341 7,938 Other noncurrent liabilities 1,898 1,830 Stockholders' equity 57,551 53,089 -------- -------- $ 87,069 $ 80,567 -------- --------
CONTACT: Fox & Hound Restaurant Group Jim Zielke InvestorRelations@fhrg.com (316) 201-4006