EXHIBIT 99.1
FROM:
Famous Dave's of America, Inc.
8091 Wallace Road
Eden Prairie, Minnesota 55344
Diana Purcel -- VP and CFO
(952) 294-1300
FOR IMMEDIATE RELEASE
- ---------------------
FAMOUS DAVE'S ANNOUNCES 2003 RESULTS
Minneapolis, MN, March 3, 2004 - Famous Dave's of America, Inc.
(Nasdaq: DAVE) today reported results for the fourth quarter and fiscal year
ended December 28, 2003. Revenues for the fourth quarter of fiscal 2003 of
approximately $22.8 million increased 6.0% over revenues for the fourth quarter
of fiscal 2002. Comparable sales for company restaurants open year-round for 18
months or more decreased 4.0% for the quarter.
For the fourth quarter of fiscal 2003, the company reported a net loss
of approximately $777,000, or $0.06 per diluted share, compared to a net loss of
approximately $228,000, or $0.02 per diluted share for the comparable period in
the prior year. The results for the fourth quarter of 2003 include pre-tax
non-recurring impairment and restructuring charges of approximately $764,000, or
$0.04 per diluted share related to the closing of two stores in the Texas
market.
Year-to-date revenues of approximately $97.7 million increased 7.6%
over 2002 revenues, while comparable sales declined 3.0%. System-wide sales for
fiscal 2003 of approximately $187.2 million increased 24.6% over system-wide
sales for the prior year. System-wide sales is a non-GAAP financial measure that
includes sales of all restaurants, company-owned and franchise, operating under
the Famous Dave's brand name. Management believes that system-wide sales
information is useful to investors because it gives a more accurate indication
of the market penetration of the Famous Dave's brand.
For fiscal year 2003, the company reported a net loss of approximately
$2.9 million, or $0.25 per diluted share, which includes pre-tax non-recurring
charges of approximately $4.2 million, or $0.22 per diluted share, related to
impairment and restructuring charges on five restaurant locations, two of which
were subsequently sold and two of which were subsequently closed. In addition,
fiscal 2003 results include pre-tax non-recurring charges of approximately $2.2
million, or $0.11 per diluted share, which reflects losses in the Isaac Hayes
Blues clubs, as well as costs associated with our divestiture of those clubs. As
previously reported, Famous Dave's has no further obligations relating to the
Isaac Hayes clubs. In comparison, the company reported a net loss for fiscal
2002 of approximately $928,000, or $0.08 per diluted share. Fiscal 2002 results
included losses of approximately $6.0 million, or $0.23 per diluted share,
related to the Isaac Hayes clubs.
"Fiscal 2003 was a year of culture building changes for our business, in
organizational direction, in areas of focus, in our approach to marketing, and
in leadership," said David Goronkin, President and CEO. "It was a year for us to
get our financial house in order and to recommit our focus towards our core
competencies, and our financial results reflect these changes," Goronkin
continued. "For example, our 2003 results reflect our financial investment
towards the basic repair and maintenance of many of our restaurants that had
been neglected. During 2003 we also took charges as a result of decisions to
divest our interest in the Isaac Hayes Blues Club operations, to eliminate the
Ribs by Air segment and to wind-down our refrigerated products business. In
addition, we took impairment charges on five restaurants, two of which we
subsequently sold and two of which we elected to close. While the consolidated
financial results of 2003 were disappointing, we are pleased with the progress
in our restaurants and the operational improvements that our team has
delivered."
Goronkin concluded, "We have put fiscal 2003 behind us and are now
firmly focused on fiscal 2004, which should prove to be a pivotal year for the
company. We will be celebrating our tenth anniversary and we will open our 100th
restaurant. The decisions that we made during fiscal 2003 are the foundation for
a successful 2004 and beyond. All efforts will be aligned with ensuring
operational integrity, brand development and financial performance. We will
focus on our core company-operated restaurants and franchise growth. While we
have no plans to open any new company-operated restaurants this year, we
anticipate opening 20 to 25 new franchise-operated restaurants by the end of
2004."
The company stated that the comparable sales decline in fiscal 2003
reflects the company's decision, during the third quarter, to eliminate routine
discounting throughout its company restaurants. Although discounting during
fiscal 2002 had increased restaurant traffic, the majority of the incremental
sales derived had substantially lower margins. The company believes that the
decision to discontinue discounting was the right decision to protect its brand
for the long-term. Comparable-sales are expected to continue to remain soft, at
a minimum, through the second quarter of 2004.
The company is hosting a conference call tomorrow, Thursday, March 4,
2004 at 10:00 am CT to discuss its fiscal 2003 financial results, and invites
all those interested in hearing management's discussion of the year to join the
conference call by dialing (800) 374-1553. A replay will be available for one
week following the call by dialing (800) 642-1687; conference ID 4888548.
Participants may also access a live webcast of the discussion through the
Investor Relations section of Famous Dave's web site at www.famousdaves.com.
Contact information: Diana Purcel (952) 294-1300, or
diana.purcel@famousdaves.com.
Famous Dave's of America, Inc. (NASDAQ:DAVE) develops, owns, operates and
franchises barbeque restaurants. The company currently owns 38 locations and
franchises 54 additional units in 23 states and has signed development
agreements for an additional 151 franchise locations. Its menu features
award-winning barbequed and grilled meats, an ample selection of salads, side
items, sandwiches and unique desserts.
Statements in this press release that are not strictly historical, including but
not limited to statements regarding the timing of our restaurant openings and
the timing or success of our expansion plans, are forward-looking statements
within the meaning of the Private Securities Litigation Reform Act of 1995.
These forward-looking statements involve known and unknown risks, which may
cause the company's actual results to differ materially from expected results.
Although Famous Dave's of America, Inc. believes the expectation reflected in
any forward-looking statements are based on reasonable assumptions, it can give
no assurance that its expectation will be attained. Factors that could cause
actual results to differ materially from Famous Dave's expectation include
financial performance, restaurant industry conditions, execution of restaurant
development and construction programs, franchisee performance, changes in local
or national economic conditions, availability of financing, governmental
approvals and other risks detailed from time to time in the company's SEC
reports.
FAMOUS DAVE'S OF AMERICA, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
For the Year Ended December 28, 2003 and December 29, 2002
(in thousands, except per share and shares outstanding)
December 28, 2003 December 29, 2002
------------------- ----------------
Revenues:
Restaurant revenues, net $ 91,500 $ 86,378
Franchising royalty revenue 4,567 3,027
Franchise fee revenue 1,139 1,205
Licensing and other revenue 534 210
----------------- ----------------
Total revenues 97,740 90,820
Costs and expenses:
Food and beverage costs 28,014 27,355
Labor and benefits 27,586 25,252
Operating expenses 23,376 20,009
Total depreciation and amortization 4,840 4,630
Impairments and restructuring charges 4,238 ---
Pre-opening expenses 543 1,040
General and administrative 9,336 8,064
----------------- ----------------
Total costs and expenses 97,933 86,350
Income (loss) from operations (193) 4,470
Other income (expense):
Interest expense, net (1,661) (1,038)
Gain on sale of assets 112 549
Other expense, net (779) (126)
Equity in losses of investment in
unconsolidate affiliate (2,155) (5,994)
----------------- ----------------
Total other expense (4,483) (6,609)
Loss before taxes (4,676) (2,139)
Income tax benefit 1,778 1,211
----------------- ----------------
Net loss $ (2,898) $ (928)
================= ================
Basic and diluted net loss per common share $ (0.25) $ (0.08)
Weighted average common shares outstanding - basic and diluted 11,771,584 11,334,997
UNIT-LEVEL COSTS AND EXPENSES AS A % OF NET RESTAURANT REVENUE
--------------------------------------------------------------
YEAR ENDED: DECEMBER 28, 2003 DECEMBER 29, 2002
----------- ----------------- ------------------
Food and beverage costs 30.6% 31.7%
Labor and benefits 29.8% 29.2%
Operating expenses 25.5% 23.2%
Depreciation and amortization 5.0% 5.0%
----------------- ------------------
Total costs and expenses 90.9% 89.1%
Income from unit-level operations 9.1% 10.9%
SUPPLEMENTAL SALES INFORMATION
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YEAR ENDED: DECEMBER 28, 2003 DECEMBER 29, 2002
----------- ---------------- -----------------
Weighted average weekly net sales, company-operated $ 42,491 $ 45,783
Weighted average weekly net sales, franchise-operated $ 47,400 $ 46,642
System-wide net sales $187,153,000 $150,231,000
Comparable net sales, company-operated (3.0%) (0.3%)
Total number of units, company-operated 38 40
Total number of units, franchise-operated 54 33
FAMOUS DAVE'S OF AMERICA, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS For the Quarter Ended
December 28, 2003 and December 29, 2002
(in thousands, except per share and shares outstanding)
DECEMBER 28, 2003 DECEMBER 29, 2002
----------------- ----------------
Revenues:
Restaurant revenues, net $ 20,734 $ 20,466
Franchising royalty revenue 1,332 773
Franchise fee revenue 384 265
Licensing and other revenue 372 35
----------------- ----------------
Total revenues 22,822 21,539
Costs and expenses:
Food and beverage costs 6,607 6,338
Labor and benefits 6,571 6,396
Operating expenses 5,885 5,111
Total depreciation and amortization 1,156 1,197
Impairments and restructuring charges 764 ---
Pre-opening expenses --- 328
General and administrative 2,551 2,147
----------------- ----------------
Total costs and expenses 23,534 21,517
Income (loss) from operations (712) 22
Other income (expense):
Interest expense, net (456) (281)
Gain (loss) on sale of assets 82 (11)
Other expense, net (114) (182)
Equity in losses of investment in
unconsolidate affiliate --- (540)
----------------- ----------------
Total other expense (488) (1,014)
Loss before taxes (1,200) (992)
Income tax benefit 423 764
----------------- ----------------
Net loss $ (777) $ (228)
================= ================
Basic and diluted net loss per common share $ (0.06) $ (0.02)
Weighted average common shares outstanding - basic and diluted 12,137,324 11,388,295
UNIT-LEVEL COSTS AND EXPENSES AS A % OF NET RESTAURANT REVENUE
--------------------------------------------------------------
QUARTER ENDED: DECEMBER 28, 2003 DECEMBER 29, 2002
-------------- ------------------ -----------------
Food and beverage costs 31.9% 31.0%
Labor and benefits 30.3% 31.3%
Operating expenses 28.1% 25.0%
Depreciation and amortization 5.2% 5.5%
---------------- ------------------
Total costs and expenses 95.5% 92.8%
Income from unit-level operations 4.5% 7.2%
SUPPLEMENTAL SALES INFORMATION
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QUARTER ENDED: DECEMBER 28, 2003 DECEMBER 29, 2002
-------------- ----------------- ----------------
Weighted average weekly net sales, company-operated $ 39,121 $ 39,973
Weighted average weekly net sales, franchise-operated $ 45,744 $ 40,193
System-wide net sales $ 48,180,000 $ 36,503,000
Comparable net sales, company-operated (4.0%) (1.4%)
Total number of units, company-operated 38 40
Total number of units, franchise-operated 54 33
FAMOUS DAVE'S OF AMERICA, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS For the Year Ended December 28,
2003 and December 29, 2002
(in thousands)
DECEMBER 28, 2003 DECEMBER 29, 2002
----------------- -----------------
ASSETS
Current assets $ 16,350 $ 13,550
Property, equipment and leasehold improvements, net 47,147 51,861
Other assets 10,270 9,406
---------------- -----------------
TOTAL ASSETS $ 73,767 $ 74,817
================ =================
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities $ 7,309 $ 7,781
Long-term obligations 19,586 19,744
Shareholders' equity 46,872 47,292
---------------- -----------------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 73,767 $ 74,817
================ =================