FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Quarterly Report Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
For the Quarter ended September 29, 1999
Commission File No. 0-10943
RYAN'S FAMILY STEAK HOUSES, INC.
(Exact name of registrant as specified in its charter)
South Carolina No. 57-0657895
(State or other jurisdiction (I.R.S. Employer
of incorporation) Identification No.)
405 Lancaster Avenue (29650)
P. O. Box 100
Greer, South Carolina 29652
(Address of principal executive
offices, including zip code)
864-879-1000
(Registrant's telephone number, including area code)
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Indicate by check mark whether the registrant (1) has filed
all reports required to be filed by Sections 13 or 15(d) of
the Securities Exchange Act of 1934 during the preceding 12
months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.
Yes X No ________
The number of shares outstanding of each of the registrant's
classes of common stock as of September 29, 1999:
36,167,000 shares of common stock, $1.00 Par Value
PART I. FINANCIAL INFORMATION
RYAN'S FAMILY STEAK HOUSES, INC.
CONSOLIDATED STATEMENTS OF EARNINGS
(Unaudited)
(In thousands, except per share data)
Quarter Ended
September 29, September 30,
1999 1998
Restaurant sales $ 170,478 162,440
Operating expenses:
Food and beverage 64,864 62,798
Payroll and benefits 50,278 47,568
Depreciation 6,707 6,391
Other operating expenses 22,160 21,358
Total operating expenses 144,009 138,115
General and administrative expenses7,670 7,467
Interest expense 2,080 1,842
Revenues from franchised restaurants(285) (296)
Other income, net (343) (516)
Earnings before income taxes 17,347 15,828
Income taxes 6,475 5,715
Net earnings $ 10,872 10,113
Net earnings per common share:
Basic $ .30 .25
Diluted .29 .24
Weighted-average shares:
Basic 36,474 40,637
Diluted 36,986 41,476
See accompanying notes to consolidated financial statements.
RYAN'S FAMILY STEAK HOUSES, INC.
CONSOLIDATED STATEMENTS OF EARNINGS
(Unaudited)
(In thousands, except per share data)
Nine Months Ended
September 29, September 30,
1999 1998
Restaurant sales $ 504,305 483,122
Operating expenses:
Food and beverage 193,383 189,293
Payroll and benefits 148,185 141,279
Depreciation 19,614 18,821
Other operating expenses 63,081 60,502
Total operating expenses 424,263 409,895
General and administrative expenses25,433 21,816
Interest expense 5,699 4,879
Revenues from franchised restaurants(888) (868)
Other income, net (1,430) (1,524)
Earnings before income taxes 51,228 48,924
Income taxes 18,878 17,662
Net earnings $ 32,350 31,262
Net earnings per common share:
Basic $ .86 .72
Diluted .84 .71
Weighted-average shares:
Basic 37,707 43,227
Diluted 38,395 43,826
See accompanying notes to consolidated financial statements.
RYAN'S FAMILY STEAK HOUSES, INC.
CONSOLIDATED BALANCE SHEETS
(In thousands)
September 29, December 30,
1999 1998
ASSETS (Unaudited)
Current assets:
Cash and cash equivalents $ 685 1,502
Receivables 3,170 2,675
Inventories 4,690 4,327
Deferred income taxes 4,311 4,311
Other current assets 703 546
Total current assets 13,559 13,361
Property and equipment:
Land and improvements 117,967 114,307
Buildings 329,327 311,809
Equipment 203,816 193,014
Construction in progress 34,240 35,742
685,350 654,872
Less accumulated depreciation 179,709 162,018
Net property and equipment 505,641 492,854
Other assets 3,119 3,178
$ 522,319 509,393
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Notes payable 86,913 72,400
Current portion of long-term debt23,252 11,626
Accounts payable 11,578 6,811
Income taxes payable 4,195 3,759
Accrued liabilities 32,847 30,431
Total current liabilities 158,785 125,027
Long-term debt 63,936 81,374
Deferred income taxes 22,809 22,620
Total liabilities 245,530 229,021
Shareholders' equity:
Common stock of $1.00 par value;
authorized 100,000,000 shares;
issued 36,167,000 shares in 1999
and 39,158,000 shares in 1998 36,167 39,158
Additional paid-in capital 17 1,274
Retained earnings 240,605 239,940
Total shareholders' equity 276,789 280,372
Commitments
$ 522,319 509,393
See accompanying notes to consolidated financial statements.
RYAN'S FAMILY STEAK HOUSES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(In thousands)
Nine Months Ended
September 29,September 30,
1999 1998
Cash flows from operating activities:
Net earnings $ 32,350 31,262
Adjustments to reconcile net
earnings to net cash provided
by operating activities:
Depreciation and amortization 20,882 20,940
Gain on sale of property
and equipment (115) (657)
Decrease (increase) in:
Receivables (495) 20
Inventories (363) (107)
Prepaid expenses (157) (1,462)
Other assets 53 4
Increase (decrease) in:
Accounts payable 4,767 (309)
Income taxes payable 436 4,539
Accrued liabilities 2,416 3,838
Deferred income taxes 189 177
Net cash provided by operating
activities 59,963 58,245
Cash flows from investing activities:
Proceeds from sale of property
and equipment 6,642 2,300
Capital expenditures (40,190) (30,249)
Net cash used in investing
activities (33,548) (27,949)
Cash flows from financing
activities:
Net proceeds from notes
payable 14,513 38,100
Repayment of long-term debt (5,812) -
Proceeds from issuance of
common stock 1,947 2,485
Purchases of common stock (37,880) (70,593)
Net cash used in financing
activities (27,232) (30,008)
Increase (decrease) in cash
and cash equivalents (817) 288
Cash and cash equivalents
- beginning of period 1,502 289
Cash and cash equivalents - end
of period $ 685 577
See accompanying notes to consolidated financial statements.
RYAN'S FAMILY STEAK HOUSES, INC.
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
(Unaudited)
(In thousands)
I. For the Nine Months ended September 29, 1999
$1 Par Value Additional
Common Paid-In Retained
Stock Capital Earnings Total
Balances at December 30, 1998 $39,158 1,274 239,940 280,372
Net earnings - - 32,350 32,350
Issuance of common stock
under Stock Option Plans 274 1,673 - 1,947
Purchases of common stock (3,265) (2,930) (31,685) (37,880)
Balances at September 29, 1999 $36,167 17 240,605 276,789
II. For the Nine Months ended September 30, 1998
$1 Par Value Additional
Common Paid-In Retained
Stock Capital Earnings Total
Balances at December 31, 1997 $46,978 457 269,626 317,061
Net earnings - - 31,262 31,262
Issuance of common stock
under Stock Option Plans 308 2,177 - 2,485
Purchases of common stock (7,235)(2,634) (60,724) (70,593)
Balances at September 30, 1998 $40,051 - 240,164 280,215
See accompanying notes to consolidated financial statements.
RYAN'S FAMILY STEAK HOUSES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 29, 1999
(Unaudited)
Note 1. Description of Business
Ryan's Family Steak Houses, Inc. operates a single-concept
restaurant chain consisting of 285 Company-owned and 24
franchised restaurants located principally in the southern
and midwestern United States. The Company, organized in
1977, opened its first restaurant in 1978 and completed its
initial public offering in 1982. The Company does not
operate or franchise any international units and has no
individually significant customers.
Note 2. Basis of Presentation
The consolidated financial statements include the financial
statements of Ryan's Family Steak Houses, Inc. and its
wholly owned subsidiaries. All significant intercompany
balances and transactions have been eliminated in
consolidation.
The accompanying unaudited consolidated financial statements
have been prepared in accordance with generally accepted
accounting principles for interim financial information and
the instructions to Form 10-Q and do not include all of the
information and footnotes required by generally accepted
accounting principles for complete financial statements. In
the opinion of management, all adjustments (consisting of
normal recurring accruals) considered necessary for a fair
presentation have been included. Consolidated operating
results for the nine months ended September 29, 1999 are not
necessarily indicative of the results that may be expected
for the fiscal year ending December 29, 1999. For further
information, refer to the consolidated financial statements
and footnotes included in the Company's annual report on
Form 10-K for the fiscal year ended December 30, 1998.
Note 3. New Accounting Pronouncement and Reclassification
At December 30, 1998, the Company adopted the provisions of
the American Institute of Certified Public Accountants'
Statement of Position ("SOP") 98-5, "Reporting on the Costs
of Start-Up Activities". SOP 98-5 requires pre-opening
costs to be expensed as incurred. Accordingly, all
unamortized pre-opening costs at December 30, 1998,
amounting to $790,000, were charged to 1998 depreciation and
amortization. For the quarter and nine months ended
September 29, 1999, all pre-opening costs are included in
"other operating expenses" and the prior year's amortization
of pre-opening costs was reclassified accordingly.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
Quarter ended September 29, 1999 versus September 30, 1998
Restaurant sales during the third quarter of 1999 increased
by 5.0% over the comparable quarter of 1998. The sales
growth resulted from the 1.7% unit growth of Company-owned
restaurants, which totaled 285 at September 29, 1999 and 277
at September 30, 1998, and from a 2.0% increase in same-
store sales. The Company calculates same-store sales using
average unit sales in units that have been open for at least
18 months and operating during comparable weeks during the
current and prior year. The third quarter's sales results
represent the seventh consecutive quarter of higher same-
store sales and compare well with the 2.8% same-store sales
increase experienced during the third quarter of 1998.
Total costs and expenses of Company-owned restaurants
include food and beverage, payroll, payroll taxes and
employee benefits, depreciation, repairs, maintenance,
utilities, supplies, advertising, insurance, property taxes
and licenses. Such costs, as a percentage of sales, were
84.5% during the third quarter of 1999 compared to 85.0% in
1998. Food and beverage costs decreased to 38.0% of sales
in 1999 from 38.7% of sales in 1998 due to lower pork,
poultry and soybean-based product costs, partially offset by
higher beef costs. Payroll and benefits increased to 29.5%
of sales in 1999 from 29.3% of sales in 1998 due principally
to higher store management and hourly personnel wages,
partially offset by lower medical insurance costs. All
other operating costs, including depreciation, decreased to
16.9% of sales in 1999 from 17.0% of sales in 1998 due
principally to decreased store closing charges related to
current year store relocations (see "Liquidity and Capital
Resources") and lower utility costs, partially offset by
higher pre-opening costs. Based on these factors, the
Company's operating margin at the restaurant level increased
to 15.5% of sales in the third quarter of 1999 from 15.0% of
sales in 1998.
General and administrative expenses decreased to 4.5% of
sales in 1999 compared to 4.6% of sales in 1998. A decrease
in media advertising spending was substantially offset by
higher training, information technology and performance-
based compensation costs. The Company's plans included a
heavy concentration of media advertising during the second
quarter of 1999, and there were virtually no advertising
expenditures during the third quarter of 1999 compared to
media advertising amounting to 0.5% of sales during the
third quarter of 1998.
Interest expense for the third quarters of 1999 and 1998
amounted to 1.2% and 1.1% of sales, respectively. Due to
the Company's stock repurchase program (see "Liquidity and
Capital Resources"), total debt increased from $159.4
million from the third quarter of 1998 to $174.1 million at
September 29, 1999. The effective average interest rate was
5.9% during the third quarter of 1999 compared to 6.1% in
1998.
Franchise revenues for the third quarters of both 1999 and
1998 amounted to 0.2% of sales. There were 24 franchised
Ryan's at September 29, 1999 compared to 26 at September 30,
1998. In August 1999, the Company amended the franchise
agreement with its sole franchisee, Family Steak Houses of
Florida, Inc. ("Family"), revising the number of Ryan's
restaurants required to be in operation by Family. A
comparison of the old and new requirements follow:
Restaurants in Operation
Old New
Year-End RequirementRequirement
1999 27 21
2000 28 23
2001 29 25
2002 30 27
2003 31 29
Subsequent years+1/year +2/year
Effective income tax rates of 37.3% and 36.1% were used for
the third quarters of 1999 and 1998, respectively. The
higher rate in 1999 resulted from higher state income tax
expense and an additive adjustment designed to bring the
overall year-to-date effective rate in line with projected
year-end requirements.
Net earnings for the third quarter of 1999 amounted to $10.9
million in 1999 compared to $10.1 million in 1998. Due to
an 11% reduction in weighted-average shares (diluted)
resulting from the Company's stock repurchase program (see
"Liquidity and Capital Resources"), earnings per share
(diluted) increased 20.8% to 29 cents in 1999 compared to 24
cents in 1998.
Nine months ended September 29, 1999 versus September 30,
1998
For the nine months ended September 29, 1999, restaurant
sales were up 4.4% compared to the same period in 1998.
Average unit growth for the nine months was up 2.0%, and
same-store sales increased 1.7% for the first nine months of
1999 and 1998.
Nine-month costs and expenses as detailed above were 84.1%
and 84.8% of sales for 1999 and 1998, respectively. During
the first nine months of 1999, costs and expenses were most
affected by lower food and beverage costs (down 0.8% of
sales) resulting from lower beef, pork, poultry and soup
prices. Payroll and benefits increased by 0.1% of sales
with higher wages substantially offset by lower medical
insurance costs. All other operating expenses, including
depreciation, approximated the prior year's level. Based on
these factors, the Company's operating margin at the
restaurant level increased to 15.9% for the first nine
months of 1999 compared to 15.2% in 1998.
General and administrative expenses increased 0.5% for the
first nine months of 1999 resulting principally from higher
media advertising and also from higher training, information
technology and performance-based compensation costs.
Additional debt resulting from the Company's stock
repurchase program (see "Liquidity and Capital Resources")
caused interest expense to increase by 0.1% of sales over
the prior year.
Effective income tax rates of 36.9% and 36.1% were used for
the first nine months of 1999 and 1998, respectively. The
higher rate in 1999 resulted from projected higher state
income tax expense.
Net earnings for the first nine months of 1999 amounted to
$32.4 million compared to $31.3 million in 1998. Due to a
12% reduction in weighted-average shares (diluted) resulting
from the Company's stock repurchase program (see "Liquidity
and Capital Resources"), earnings per share (diluted)
increased 18% to 84 cents in 1999 compared to 71 cents in
1998.
LIQUIDITY AND CAPITAL RESOURCES
The Company's restaurant sales are primarily derived from
cash. Inventories are purchased on credit and are rapidly
converted to cash. Therefore, the Company does not maintain
significant receivables or inventories, and other working
capital requirements for operations are not significant.
At September 29, 1999, the Company's working capital was a
$145.2 million deficit compared to a $111.7 million deficit
at December 30, 1998. Included in these amounts are notes
payable under bank lines of credit (see third succeeding
paragraph) and current portions of long-term debt, totaling
$110.2 million and $84.0 million at September 29, 1999 and
December 30, 1998, respectively. The Company does not
anticipate any adverse effects from the current working
capital deficit due to significant cash flow provided by
operations, which amounted to $60.0 million for the first
nine months of 1999 and $73.0 million for the year ended
December 30, 1998.
Total capital expenditures for the first nine months of 1999
amounted to $40.2 million. The Company opened 14 and closed
nine Ryan's restaurants during the first nine months of
1999. These numbers include four openings and six closings
related to relocated restaurants. Management defines a
relocation as a restaurant opened within 18 months after
closing another restaurant in the same marketing area. A
relocation represents a redeployment of assets within a
market. For all of 1999, the Company plans to open a total
of eighteen Ryan's, including six relocations. Total
capital expenditures for 1999 are estimated at $55 million.
Expansion of Company-owned restaurants will occur in states
within the Company's current 22-state operating area. The
Company is currently concentrating its efforts on Company-
owned units and is not actively pursuing any additional
franchised locations, either domestic or international.
The Company began a stock repurchase program in March 1996
and is currently authorized to repurchase a total of 20.0
million shares of the Company's common stock through
December 2000. Repurchases may be made from time to time on
the open market or in privately negotiated transactions in
accordance with applicable securities regulations, depending
on market conditions, share price and other factors.
Through September 29, 1999, approximately 18.4 million
shares, or 35% of total shares available at the beginning of
the repurchase program, had been purchased at an aggregate
cost of $174.7 million. From September 30, 1999 through
November 12, 1999, another 345,000 shares were purchased at
an aggregate cost of $3.4 million. Management intends to
proceed with the repurchase program during 1999 and 2000,
subject to the continued availability of capital and the
other factors described below in "Forward-Looking
Information".
The extent of the Company's external funding requirements
for the remainder of 1999 is dependent upon the level of
stock repurchase transactions during the year. Based on
current target debt levels, a maximum repurchase scenario
would require approximately $8.3 million of additional
borrowings during the remainder of 1999. All other funding
needs, including capital expenditures, are expected to be
met by internally generated cash from operations. The
Company's debt structure currently consists of a $93 million
term loan (see following paragraph) and several uncommitted
bank lines totaling $115 million at various short-term rates
of which $86.9 million was utilized at September 29, 1999.
The term loan agreement contains, among other provisions,
requirements for the Company to maintain a minimum net worth
level and certain financial ratios and restrictions on the
Company's ability to incur additional indebtedness, merge,
consolidate, and acquire or sell assets. In October 1998,
an amendment to the term loan agreement increased the
maximum permitted debt-to-total capitalization ratio to 45%
and set a fixed minimum net worth requirement of $255
million. At September 29, 1999, the Company exceeded the
agreement's most restrictive minimum net worth covenant by
approximately $21.8 million.
Under the current borrowing agreements, no interest rates
have been fixed and generally change in response to the
London Interbank Offered Rate ("LIBOR"). In October 1997,
the Company entered into an interest rate swap agreement
with a major regional bank as the issuing counterparty under
which the Company pays to (receives from) the counterparty
an amount by which the three-month LIBOR is less (greater)
than 5.54%. This transaction, which effectively converted
$25,000,000 of the floating-rate debt to a fixed-rate
obligation, was scheduled to run through October 2000 and
could be terminated by the bank at any time after October
30, 1998. On October 29, 1999, the bank exercised their
option and terminated the interest rate swap agreement.
Management believes that its current debt structure is
sufficient to meet its 1999 requirements. However,
additional credit facilities are expected to be necessary to
meet future repurchase objectives in years 2000 and beyond.
Accordingly, the Company intends to refinance and add
capacity to its current debt structure. Discussions are
actively underway with financing sources to arrange the
appropriate credit facilities, and a new debt structure is
expected to be in place by year-end 1999. Due to the
current credit and interest rate environments, an increase
in the Company's effective average interest rate is
expected. Factors that could affect the refinancing and
restructuring of the
Company's debt include changes in the credit markets and
interest rate environment, the credit appraisal of the
Company by prospective lenders, and the final proposed
pricing and terms of the new credit facilities. Management
may also enter into future interest rate hedging
transactions if deemed advantageous.
IMPACT OF INFLATION
The Company's operating costs that may be affected by
inflation consist principally of food, payroll and utility
costs. A number of the Company's restaurant team members
are paid at the minimum wage and, accordingly, legislated
changes to the minimum wage affect the Company's payroll
costs. Although no minimum wage increases have been signed
into law, various proposals are presently being discussed
and voted upon in the U.S. Congress. News reports suggest
that the Federal minimum wage may increase by $1 per hour to
$6.15 with a two to three year phase-in period, commencing
in early-2000. The Company is typically able to increase
its menu prices to cover most of the payroll rate increases.
The Company considers its current price structure to be very
competitive. The Company considers this factor, among
others, when passing increased costs on to its customers.
Annual menu price increases have consistently ranged from 2%
to 4%.
YEAR 2000
The Company recognizes the need to ensure that its
operations will not be adversely impacted by software
failures associated with programming incompatibilities with
the year 2000 ("Y2K"). In 1997, the Company identified
those systems that were not Y2K-compliant and began
researching conversion and replacement options. Further
investigation, including a review by an outside consultant
of the operating environment related to the Company's
principal financial applications, continued throughout much
of 1998. Costs associated with the Y2K plan that represent
significant functional or technology improvements are
capitalized. Other costs related principally to Y2K
compatibility are charged to expense as incurred. The total
cost of the Y2K remediation project is estimated at
$512,000, consisting of approximately $259,000 of capital
and $253,000 of expense costs. All funding is expected to
come from operating cash flows. At September 29, 1999,
approximately $139,000 of capital and $188,000 of expense had
been spent on the project.
The Company's Information Technology department is leading
the Company's Y2K efforts. Reports on Y2K remediation
efforts are made periodically to the Company's senior
management and quarterly to the Company's Board of
Directors. At December 30, 1998, conversion of all major
corporate office financial systems (general ledger, accounts
payable, payroll and benefits) was complete. Upgrades to
critical store-level systems were completed by the end of
the third quarter of 1999, and remediation steps for the
corporate office's personal computers were also completed by
the end of the third quarter. In July 1999, a multi-
functional team tested the Y2K-readiness of the Company's
current software and hardware solutions by performing
critical store operations and corporate financial functions
with systems set with a year 2000 date. The test was very
successful with only minor issues identified, and all such
issues were subsequently corrected. As of September 29,
1999, the only remaining software remediation work involved
several non-critical corporate applications. The re-
programming of these applications is expected to be
completed by the end of November 1999.
As part of its Y2K planning, the Company has identified
vendors whose goods and services are believed to be critical
to the Company's ability to operate its restaurants. The
Company's principal food distributor has informed the
Company that all of its systems related to the procurement
and delivery of food and other products to the Company's
restaurants were fully Y2K-compliant at the end of 1998.
The Company's credit card processor has also informed the
Company that its systems are now fully Y2K-compliant.
Furthermore, the credit card terminals used in the Company's
restaurants are already processing credit cards with post-
1999 expiration dates, and the processor has indicated that
no additional software modifications to the terminals will
be necessary. Finally, the Company has sent questionnaires
to its numerous depository and disbursement banks and
utility providers in order to ascertain their ability to
deliver services on January 1, 2000 and beyond. Responses
to these questionnaires were very guarded and therefore not
adequately informative. Corporate personnel are currently
contacting these providers or reviewing their web sites in
order to ascertain their degree of Y2K compliance. Due to
the computer systems used to manage the operations of the
Company's restaurants, electrical and telephone service to
the Company's corporate office is considered critical. The
utility company providing electricity and water to the
corporate office has assured Company management that its
systems as well as those of its suppliers are Y2K-compliant.
The web sites of the corporate office's local and long-
distance providers indicate that service will not be
interrupted on January 1, 2000.
The Company's stores depend upon computers for point-of-sale
("POS") transactions, data and purchase order transmissions,
labor scheduling and payroll processes, and inventory and
food cost records. Other technology-dependent functions at
the stores are not significant. Management believes that
its Y2K efforts have addressed the stores' critical
technology-dependent functions. The Company is developing
contingency plans in the event of the failure of critical
support systems, including banking and utility services, and
expects such plans to be completed during the fourth quarter
of 1999. In addition, any material disruption in the
general economy as a result of Y2K issues could adversely
affect the Company's operations.
FORWARD-LOOKING INFORMATION
In accordance with the safe harbor provisions of the
Private Securities Litigation Reform Act of 1995, the
Company cautions that the statements in this report and
elsewhere, which are forward-looking and which provide
other than historical information, involve risks and
uncertainties that may impact the Company's actual results
of operations. All statements other than statements of
historical fact that address activities, events or
developments that the Company expects or anticipates will
or may occur in the future, including such things as
deadlines for completing projects, expected financial
results, results of Y2K remediation, and other such
matters are forward-looking information. The words
"estimate", "plans", "anticipate", "expects", "intend",
"believe", and similar expressions are intended to
identify forward-looking statements. All forward-looking
information reflects the Company's best judgment based on
current information. However, there can be no assurance
that other factors will not affect the accuracy of such
information. While it is not possible to identify all
factors, the following could cause actual results to
differ materially from expectations: general economic
conditions; competition; developments affecting the
continued operation of the restaurants' buffet lines; real
estate availability; food and labor supply costs; food and
labor availability; weather fluctuations; interest rate
fluctuations; stock market conditions; and other risks and
factors described from time to time in the Company's
reports filed with the Securities and Exchange Commission,
including the Company's annual report on Form 10-K for the
fiscal year ended December 30, 1998. The ability of the
Company to open new restaurants depends upon a number of
factors, including its ability to find suitable locations
and negotiate acceptable land acquisition and construction
contracts, its ability to attract and retain sufficient
numbers of restaurant managers and team members, and the
availability of reasonably priced capital. The extent of
the Company's stock repurchase program during 1999 and
future years depends upon the financial performance of the
Company's restaurants, the investment required to open new
restaurants, share price, the availability of reasonably
priced capital, the financial covenants contained in loan
agreements, and the maximum debt and share repurchase
levels authorized by the Company's Board of Directors.
Factors that could result in the Company not being Y2K-
compliant by January 1, 2000 include, but are not limited
to the following: failure to detect Y2K system or
programming incompatibilities in existing systems or
software; other programming incompatibilities related to
purchased or internally-developed software; the inability
to verify Y2K compliance by third parties; non-delivery of
Y2K-compliant solutions from developers of purchased
software; and the inability to engage or retain adequate
personnel, either internal or external, to correct Y2K
system and programming issues.
PART II. OTHER INFORMATION
Item 1. Legal Proceedings.
None reportable.
Item 2. Changes in
Securities.
None.
Item 3. Defaults Upon Senior
Securities.
None.
Item 4. Submission of
Matters to a Vote of Security Holders.
None reportable.
Item 5. Other Information.
None.
Item 6. Exhibits and Reports
on Form 8-K.
(a)None.
(b)On July 6, 1999, the Company filed a report on
Form 8-K regarding sales information for June
1999.
On August 9, 1999, the Company filed a report on
Form 8-K regarding sales information for July
1999.
On September 7, 1999, the Company filed a report
on Form 8-K regarding sales information for
August 1999.
On October 4, 1999, the Company filed a report
on Form 8-K regarding sales information for
September 1999.
On November 9, 1999, the Company filed a report
on Form 8-K regarding sales information for
October 1999.
Pursuant to the requirements of the Securities Exchange
Act of 1934, the registrant has duly caused this report to
be signed on its behalf by the undersigned thereunto duly
authorized.
RYAN'S FAMILY STEAK HOUSES, INC.
(Registrant)
November 16, 1999 /s/Charles D. Way
Charles D. Way
Chairman, President and Chief
Executive Officer
November 16, 1999 /s/Fred T. Grant, Jr.
Fred T. Grant, Jr.
Vice President-Finance and
Treasurer
November 16 1999 /s/Richard D. Sieradzki
Richard D. Sieradzki
Controller