Buffalo Wild Wings (BWLD) 8-K Buffalo Wild Wings, Inc. Announces Second Quarter 2009 Results

Exhibit 99.1

Buffalo Wild Wings, Inc. Announces Second Quarter 2009 Results

– Same-store sales increases of 2.8% at company-owned and 3.7% at franchised restaurants –

– Earnings per diluted share increase of 25.8% to $0.39 –

MINNEAPOLIS--(BUSINESS WIRE)--July 27, 2009--Buffalo Wild Wings, Inc. (NASDAQ: BWLD), announced today financial results for the second quarter ended June 28, 2009. Highlights for the second quarter versus the same period a year ago were:

• Total revenue increased 32.4% to $129.6 million
• Company-owned restaurant sales grew 34.6% to $117.8 million
• Same-store sales increased 2.8% at company-owned restaurants and 3.7% at franchised restaurants
• Net earnings increased 24.2% to $7.0 million from $5.6 million, and earnings per diluted share increased 25.8% to $0.39 from $0.31

Sally Smith, President and Chief Executive Officer, commented, “We’re very pleased with our ongoing success and the strong second quarter results. Our revenue growth of 32.4% produced impressive net earnings growth of 24.2% over the same period in the prior year, achieving earnings per diluted share of $0.39. With the unsettling and ever-changing economic backdrop, our results are testament that we provided our Guests with an unparalleled dining experience and that Team Members at all levels of our organization were tenacious in delivering strong operational and financial performance.”

Total revenue increased 32.4% to $129.6 million in the second quarter compared to $97.9 million in the second quarter of 2008. Company-owned restaurant sales for the quarter increased 34.6% over the same period in 2008, to $117.8 million driven by a company-owned same-store sales increase of 2.8% and 46 additional company-owned restaurants in operation at the end of second quarter 2009 relative to the same period in 2008. Franchise royalties and fees increased 14.0% to $11.9 million versus $10.4 million in the second quarter of 2008. This increase was the result of a franchised same-store sales increase of 3.7% and 37 additional franchised restaurants at the end of the period versus a year ago.

Average weekly sales for company-owned restaurants were $42,938 for the second quarter of 2009 compared to $40,572 for the same quarter last year, a 5.8% increase. Franchised restaurants averaged $48,619 for the period versus $46,390 in the second quarter a year ago, a 4.8% increase.

For the second quarter, net earnings increased 24.2% to $7.0 million versus $5.6 million in the second quarter of 2008. Earnings per diluted share were $0.39, as compared to second quarter 2008 earnings per diluted share of $0.31.

2009 Outlook

Ms. Smith continued, “We’re heading into our favorite time of the year – football season! We’re investing in our brand with enhanced facilities, craveable new products, and expanded national media campaigns, and our Operations Team is prepared to deliver the You Have To Be Here® experience to our Guests.”

Ms. Smith concluded, “We continue on pace to meet each of our 2009 annual goals of 15% unit, 25% revenue, and 20 to 25% net earnings growth. Since going public nearly six years ago, you’ve heard us speak about our goal of becoming a restaurant chain of 1,000 units in the United States, which we believe we will achieve in 2013. We continue expansion into all fifty states, which will include small towns and urban markets, and development of nontraditional sites such as airports. With the groundwork underway for international development, this 1,000-unit goal is a stepping stone on our way to becoming a global brand.”

Buffalo Wild Wings will be hosting a conference call today, July 27, 2009 at 4:00 p.m. Central Daylight Time to discuss these results. There will be a simultaneous webcast conducted at our website www.buffalowildwings.com.

A replay of the call will be available until August 3, 2009. To access this replay, please dial 1.303.590.3030, password 4116719.

About the Company

Buffalo Wild Wings, Inc., founded in 1982 and headquartered in Minneapolis, Minnesota, is a growing owner, operator and franchisor of restaurants featuring a variety of boldly-flavored, made-to-order menu items including Buffalo-style chicken wings spun in one of 14 signature sauces. Buffalo Wild Wings is an inviting neighborhood destination with widespread appeal and is the recipient of dozens of “Best Wings” and “Best Sports Bar” awards from across the country. There are currently 601 Buffalo Wild Wings locations across 41 states.

Forward-looking Statements

Certain statements in this release that are not historical facts are forward-looking statements that involve risks and uncertainties. These statements include, without limitation, those relating to our projected unit, revenue and earnings growth rates for 2009 and beyond, the projected timeline for and nature of our expansion activities, and our anticipated marketing activities. Forward-looking statements are based upon the current beliefs and expectations of our management. Actual results may vary materially from those contained in forward-looking statements based on a number of factors including, without limitation, the actual number of locations opening in the future, the sales at these and our other company-owned and franchised locations, our ability to successfully operate in new markets, unforeseen obstacles in developing nontraditional sites, the cost of commodities, the success of our marketing and other initiatives, our ability to control restaurant labor and other restaurant operating costs, economic conditions (including changes in consumer preferences or consumer discretionary spending), the availability of financing to real estate developers and franchisees, competition, the impact of applicable regulations, and other factors disclosed from time to time in our filings with the U.S. Securities and Exchange Commission. Investors should take such risks into account when making investment decisions. Shareholders and other readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date on which they are made. We undertake no obligation to update any forward-looking statements.

BUFFALO WILD WINGS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
(Amounts in thousands except per share data)
(unaudited)
	Three months ended			Six months ended
	June 28, 2009		June 29, 2008	June 28, 2009	June 29, 2008
Revenue:
Restaurant sales	$	117,763	87,462	237,187	174,358
Franchise royalties and fees		11,859	10,406	23,990	20,772
Total revenue		129,622	97,868	261,177	195,130
Costs and expenses:
Restaurant operating costs:
Cost of sales		35,922	26,248	72,130	52,663
Labor		36,056	27,020	71,605	52,878
Operating		17,966	13,857	35,953	27,132
Occupancy		7,924	5,902	15,518	11,599
Depreciation and amortization		7,888	5,510	15,383	10,749
General and administrative (1)		11,773	9,047	23,193	18,388
Preopening		1,673	1,758	4,082	2,943
Loss on asset disposals and impairment		272	385	447	1,138
Total costs and expenses		119,474	89,727	238,311	177,490
Income from operations		10,148	8,141	22,866	17,640
Investment income		413	400	489	832
Earnings before income taxes		10,561	8,541	23,355	18,472
Income tax expense		3,586	2,926	7,894	6,332
Net earnings	$	6,975	5,615	15,461	12,140
Earnings per common share – basic	$	0.39	0.32	0.86	0.68
Earnings per common share – diluted		0.39	0.31	0.86	0.68
Weighted average shares outstanding – basic		17,999	17,810	17,990	17,788
Weighted average shares outstanding – diluted		18,070	17,906	18,052	17,893

(1) Includes stock-based compensation of $1,689, $904, $2,490, and $1,924, respectively

The following table expresses results of operations as a percentage of total revenue for the periods presented, except for restaurant operating costs which are expressed as a percentage of restaurant sales:

	Three months ended				Six months ended
	June 28, 2009		June 29, 2008		June 28, 2009		June 29, 2008
Revenue:
Restaurant sales	90.9	%	89.4	%	90.8	%	89.4	%
Franchising royalties and fees	9.1		10.6		9.2		10.6
Total revenue	100.0		100.0		100.0		100.0
Costs and expenses:
Restaurant operating costs:
Cost of sales	30.5		30.0		30.4		30.2
Labor	30.6		30.9		30.2		30.3
Operating	15.3		15.8		15.2		15.6
Occupancy	6.7		6.7		6.5		6.7
Depreciation and amortization	6.1		5.6		5.9		5.5
General and administrative	9.1		9.2		8.9		9.4
Preopening	1.3		1.8		1.6		1.5
Loss on asset disposals and impairment	0.2		0.4		0.2		0.6
Total costs and expenses	92.2		91.7		91.2		91.0
Income from operations	7.8		8.3		8.8		9.0
Investment income	0.3		0.4		0.2		0.4
Earnings before income taxes	8.1		8.7		8.9		9.5
Income tax expense	2.8		3.0		3.0		3.2
Net earnings	5.4		5.7		5.9		6.2

BUFFALO WILD WINGS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
June 28, 2009 and December 28, 2008
(Dollar amounts in thousands)
(unaudited)
	June 28, 2009	December 28, 2008
Assets
Current assets:
Cash and cash equivalents	$ 11,139	$ 8,347
Marketable securities	37,867	36,157
Accounts receivable – franchisees, net of allowance of $25	881	895
Accounts receivable – other	6,746	5,759
Inventory	3,359	3,104
Prepaid expenses	1,905	3,294
Refundable income taxes	—	1,611
Deferred income taxes	2,741	1,731
Total current assets	64,638	60,898
Property and equipment, net	168,171	154,432
Restricted cash	10,707	7,670
Other assets	9,645	9,846
Goodwill	10,972	10,972
Total assets	$ 264,133	243,818
Liabilities and Stockholders’ Equity
Current liabilities:
Unearned franchise fees	$ 2,680	2,514
Income tax payable	253	—
Accounts payable	12,778	16,691
Accrued compensation and benefits	14,245	14,155
Accrued expenses	5,606	7,116
Current portion of deferred lease credits	173	56
Total current liabilities	35,735	40,532
Long-term liabilities:
Other liabilities	1,350	1,270
Marketing fund payables	10,707	7,670
Deferred income taxes	11,565	8,916
Deferred lease credits, net of current portion	14,799	13,837
Total liabilities	74,156	72,225
Commitments and contingencies
Stockholders’ equity:
Undesignated stock, 1,000,000 shares authorized; none issued	—	—
Common stock, no par value. Authorized 44,000,000 shares; issued and outstanding 18,023,450 and 17,887,271 respectively	89,241	86,318
Retained earnings	100,736	85,275
Total stockholders’ equity	189,977	171,593
Total liabilities and stockholders’ equity	$ 264,133	243,818

BUFFALO WILD WINGS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollar amounts in thousands)
(unaudited)
	Six months ended
	June 28, 2009			June 29, 2008
Cash flows from operating activities:
Net earnings	$	15,461		12,140
Adjustments to reconcile net earnings to cash provided by operations:
Depreciation		15,077		10,749
Amortization		306		36
Loss on asset disposals and impairment		447		1,138
Deferred lease credits		840		1,113
Deferred income taxes		1,639		2,386
Stock-based compensation		2,490		1,924
Excess tax benefit from the exercise of stock options		(31	)	(302	)
Change in operating assets and liabilities:
Trading securities		(1,204	)	(76	)
Accounts receivable		(734	)	182
Inventory		(255	)	(155	)
Prepaid expenses		1,389		1,098
Other assets		(105	)	(79	)
Unearned franchise fees		166		89
Accounts payable		(61	)	376
Income taxes		1,895		960
Accrued expenses		20		(928	)
Net cash provided by operating activities		37,340		30,651
Cash flows from investing activities:
Acquisition of property and equipment		(33,115	)	(24,643	)
Purchase of marketable securities		(25,284	)	(68,578	)
Proceeds of marketable securities		24,778		69,852
Net cash used in investing activities		(33,621	)	(23,369	)
Cash flows from financing activities:
Issuance of common stock		555		562
Tax payments for restricted stock units		(1,513	)	(989	)
Excess tax benefit from the exercise of stock options		31		302
Net cash used in financing activities		(927	)	(125	)
Net increase in cash and cash equivalents		2,792		7,157
Cash and cash equivalents at beginning of period		8,347		1,521
Cash and cash equivalents at end of period	$	11,139		8,678

BUFFALO WILD WINGS, INC. AND SUBSIDIARIES
Supplemental Information
Restaurant Count
Company-owned Restaurants:
	Q1		Q2		Q3		Q4
2009	206		215
2008	165		169		187		197
2007	140		145		148		161
2006	124		129		134		139
2005	106		110		116		122
Franchised Restaurants:
	Q1		Q2		Q3		Q4
2009	373		383
2008	340		346		348		363
2007	299		301		313		332
2006	260		270		278		290
2005	212		224		234		248
Same-Store Sales
Company-owned Restaurants:
	Q1		Q2		Q3		Q4		Year
2009	6.4	%	2.8	%
2008	4.1	%	8.3	%	6.8	%	4.5	%	5.9	%
2007	8.7	%	8.1	%	8.3	%	3.4	%	6.9	%
2006	7.7	%	8.2	%	11.8	%	13.2	%	10.4	%
2005	6.1	%	2.7	%	1.8	%	2.5	%	3.2	%
Franchised Restaurants:
	Q1		Q2		Q3		Q4		Year
2009	6.0	%	3.7	%
2008	2.1	%	4.5	%	2.1	%	2.5	%	2.8	%
2007	3.3	%	4.0	%	5.9	%	2.3	%	3.9	%
2006	6.7	%	4.7	%	6.4	%	6.5	%	6.1	%
2005	3.2	%	1.8	%	1.1	%	2.6	%	2.2	%

Average Weekly Sales Volumes
Company-owned Restaurants:
	Q1		Q2	Q3	Q4	Year
2009	$	45,593	42,938
2008		41,438	40,572	42,400	43,864	42,141
2007		39,254	36,655	38,498	40,485	38,757
2006		35,857	33,660	35,380	38,800	36,033
2005		33,195	30,531	31,361	33,953	32,304
Franchised Restaurants:
	Q1		Q2	Q3	Q4	Year
2009	$	50,729	48,619
2008		47,812	46,390	46,889	48,424	47,382
2007		46,439	43,998	45,879	47,293	45,901
2006		44,342	42,338	42,963	46,008	43,975
2005		41,309	39,824	40,149	42,533	40,999

CONTACT:
Buffalo Wild Wings, Inc.
Investor Relations Contact:
Mary Twinem, 952-253-0731