EXHIBIT 99.1
News Release
For Immediate Release
For further information contact:
Jeff Elliott or Geralyn DeBusk
Halliburton Investor Relations
972-458-8000
DAVE & BUSTER’S REPORTS FIRST QUARTER 2004 EARNINGS
DALLAS (June 7, 2004) Dallas- Dave & Buster’s Inc. (NYSE:DAB), a leading operator of upscale restaurant/entertainment complexes, announced earnings for its first quarter ended May 2, 2004.
Total revenue for the first quarter increased 3.7 percent, or $3.4 million, to $95.0 million from $91.6 million in the prior year’s comparable quarter. Food and beverage revenue increased 2.8 percent and amusement and other revenue increased 4.6 percent. Revenue from comparable stores increased 1.7 percent for the quarter. Special event revenue on a comparable store basis was 12.6 percent of total revenue compared to 12.2 percent of total revenue in the first quarter last year. Operating income for the period increased 4.2 percent to $7.0 million compared to $6.7 million last year. Net income for the quarter was $3.6 million, or $.25 per diluted share, compared to net income in the same period last year of $3.0 million, or $.23 per diluted share. Consensus earnings estimates for the quarter were $.23 per diluted share. The number of diluted shares outstanding increased 22.1 percent to 16.192 million shares in the current quarter compared to 13.264 million shares last year, primarily as a result of the convertible debt issued during last fiscal year.
“We are pleased to see the comparable store revenues turn positive in the first quarter, and the increase in amusement revenues is certainly encouraging,” stated Buster Corley, the Company’s CEO. “The earnings improvement continues to show that our ongoing plan of reducing costs while increasing our comparable store revenues is working. We remain focused on these objectives and believe we will be successful in finding additional efficiencies in our operations.”
“It is important to note that we improved our earnings for the fifth consecutive quarter, even with the more than 22 percent increase in diluted shares outstanding,” commented Dave Corriveau, the Company’s President. Mr. Corriveau continued, “We are pleased to announce that our Mexican licensee opened their second store in Monterrey last month. In addition, we are on target to open our new Santa Anita store in the third quarter. “
The Company will hold a conference call to discuss first quarter results on Monday, June 7, 2004, at 11:30 a.m. Eastern Time (10:30 a.m. Central Time). 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, 2004.
Celebrating 21 years of operations, Dave & Buster’s was founded in 1982 and is one of the country’s leading upscale, restaurant/entertainment concepts with 33 locations throughout the United States and Canada. For more information on the Company, including the latest investor presentation, please visit the Company’s website, www.daveandbusters.com
Forward-Looking Statements
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.
DAVE & BUSTER’S, INC.
Condensed Consolidated Balance Sheets
(in thousands)
(unaudited)
May 2, 2004 | February 1, 2004 | |||||||
ASSETS | ||||||||
Current assets | ||||||||
Cash and cash equivalents | $ | 5,850 | $ | 3,897 | ||||
Other current assets | 33,221 | 31,460 | ||||||
Total current assets | 39,071 | 35,357 | ||||||
Property and equipment, net | 246,480 | 247,161 | ||||||
Other assets and deferred charges | 13,125 | 13,371 | ||||||
$ | 298,676 | $ | 295,889 | |||||
LIABILITIES AND STOCKHOLDERS EQUITY | ||||||||
Total current liabilities | $ | 34,563 | $ | 35,577 | ||||
Other long-term liabilities | 27,664 | 27,222 | ||||||
Long-term debt | 48,968 | 50,201 | ||||||
Stockholders’ equity | ||||||||
Common stock | 133 | 132 | ||||||
Paid in capital | 119,569 | 118,669 | ||||||
Restricted stock awards | 986 | 905 | ||||||
Retained earnings | 68,639 | 65,029 | ||||||
189,327 | 184,735 | |||||||
Less: Treasury stock | (1,846 | ) | (1,846 | ) | ||||
Total stockholders’ equity | 187,481 | 182,889 | ||||||
$ | 298,676 | $ | 295,889 | |||||
DAVE & BUSTER’S, INC.
Consolidated Statements of Income
(dollars in thousands, except per share amounts)
(unaudited)
13 Weeks Ended | 13 Weeks Ended | |||||||||||||||
May 2, 2004 | May 4, 2003 | |||||||||||||||
Food and beverage revenues | $ | 49,021 | 51.6 | % | $ | 47,664 | 52.0 | % | ||||||||
Amusement and other revenues | 45,945 | 48.4 | % | 43,923 | 48.0 | % | ||||||||||
Total revenues | 94,966 | 100.0 | % | 91,587 | 100.0 | % | ||||||||||
Cost of revenues | 17,721 | 18.7 | % | 16,671 | 18.2 | % | ||||||||||
Operating payroll and benefits | 26,928 | 28.4 | % | 26,799 | 29.3 | % | ||||||||||
Other store operating expenses | 29,592 | 31.2 | % | 28,192 | 30.8 | % | ||||||||||
General and administrative expenses | 6,299 | 6.6 | % | 5,939 | 6.5 | % | ||||||||||
Depreciation and amortization expense | 7,466 | 7.9 | % | 7,307 | 8.0 | % | ||||||||||
Total operating expenses | 88,006 | 92.7 | % | 84,908 | 92.7 | % | ||||||||||
Operating income | 6,960 | 7.3 | % | 6,679 | 7.3 | % | ||||||||||
Interest expense, net | 1,478 | 1.6 | % | 2,060 | 2.3 | % | ||||||||||
Income before provision for income taxes | 5,482 | 5.8 | % | 4,619 | 5.0 | % | ||||||||||
Provision for income taxes | 1,864 | 2.0 | % | 1,570 | 1.7 | % | ||||||||||
Net income | $ | 3,618 | 3.8 | % | $ | 3,049 | 3.3 | % | ||||||||
Net income per share | ||||||||||||||||
Basic | $ | 0.27 | $ | 0.23 | ||||||||||||
Diluted | $ | 0.25 | $ | 0.23 | ||||||||||||
Weighted average shares outstanding | ||||||||||||||||
Basic weighted average shares outstanding | 13,205 | 13,090 | ||||||||||||||
Diluted weighted average shares outstanding | 16,192 | 13,264 | ||||||||||||||
Other information: | ||||||||||||||||
Company operated stores open | 33 | 32 | ||||||||||||||
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. | ||||||||||||||||
Total net income | $ | 3,618 | $ | 3,049 | ||||||||||||
Add back: depreciation and amortization | 7,466 | 7,307 | ||||||||||||||
interest expense, net | 1,478 | 2,060 | ||||||||||||||
provision for income taxes | 1,864 | 1,570 | ||||||||||||||
$ | 14,426 | $ | 13,986 |
DAVE & BUSTER’S, INC.
Consolidated Statements of Cash Flow
(dollars in thousands, except per share amounts)
(unaudited)
13 Weeks Ended | 13 Weeks Ended | |||||||
May 2, 2004 | May 4, 2003 | |||||||
Cash flows from operating activities: | ||||||||
Income | $ | 3,618 | $ | 3,049 | ||||
Adjustments to reconcile income to net cash provided by operating activities: | ||||||||
Depreciation and amortization | 7,466 | 7,307 | ||||||
Deferred income tax expense | (140 | ) | (9 | ) | ||||
Tax benefit related to stock options | 140 | — | ||||||
Restricted stock awards | 81 | 66 | ||||||
Warrants related to convertible debt | 63 | — | ||||||
(Gain) loss on sale of assets | (43 | ) | 160 | |||||
Other | 29 | — | ||||||
Changes in operating assets and liabilities Inventories | (700 | ) | 321 | |||||
Prepaid expenses | (1,960 | ) | (1,972 | ) | ||||
Other current assets | 899 | 313 | ||||||
Other assets and deferred charges | 246 | 239 | ||||||
Accounts payable | (847 | ) | (785 | ) | ||||
Accrued liabilities | 878 | 908 | ||||||
Income taxes payable | (905 | ) | 1,683 | |||||
Other liabilities | 442 | 451 | ||||||
Net cash provided by operating activities | 9,267 | 11,731 | ||||||
Cash flows from investing activities: | ||||||||
Capital expenditures | (7,067 | ) | (7,424 | ) | ||||
Proceeds from sale of property and equipment | 325 | 87 | ||||||
Net cash used in investing activities | (6,742 | ) | (7,337 | ) | ||||
Cash flows from financing activities: | ||||||||
Borrowings under long-term debt | 1,500 | 1,750 | ||||||
Repayments of long-term debt | (2,833 | ) | (5,875 | ) | ||||
Proceeds from exercises of common stock options | 761 | 135 | ||||||
Net cash (used) in financing activities | (572 | ) | (3,990 | ) | ||||
Increase in cash and cash equivalents | 1,953 | 404 | ||||||
Beginning cash and cash equivalents | 3,897 | 2,530 | ||||||
Ending cash and cash equivalents | $ | 5,850 | $ | 2,934 | ||||