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Ruby Tuesday, Inc. Reports First Quarter Earnings Per Share Growth of 30%

10/03/2001

MARYVILLE, Tenn., Oct. 3 /PRNewswire/ -- Ruby Tuesday, Inc. (NYSE: RI), one of America's leading companies in the bar and grill segment of casual dining, today reported first quarter earnings per share of $0.26, up 30% from $0.20 a year ago. Net income of $16.8 million for the quarter ended September 4, 2001 was up 31% from $12.9 million a year ago. For the quarter, system-wide same-store sales increased 2.2%, which was led by same-store sales growth of 2.8% at domestic franchise Ruby Tuesday(R) restaurants. Same-store sales at Company-owned Ruby Tuesday restaurants increased 2.0%, while average unit volumes at Company-owned Ruby Tuesday restaurants increased 3.0% during the quarter.

"We are extremely pleased with the results of our first quarter," said Sandy Beall, Chairman and CEO. "We have done a tremendous job focusing on our business and our teams and creating value for our guests and shareholders. Our new menu which rolled out in June has been very well accepted and has received our highest ratings ever. During the quarter, we benefited from reducing the costs of business without sacrificing our guests' experiences through implementing plans and procedures that have been in the works since the Spring."

Beall continued, "We express our condolences to all those affected by recent tragic events in our nation. We are proud of our team members for their participation in events and activities to help those in need. While these events have undoubtedly affected the economy, I would expect our same- store sales increase for fiscal 2002 to be in the 1.0-1.5% range versus our originally modeled 2% increase. Based on this, we remain comfortable with the consensus analyst estimate prior to the recent events for fiscal 2002 earnings per share of $1.09, which represents a 20% increase over the prior year. Including the impact of having approximately 100 mall units closed on September 11th, second quarter same-store sales are down 0.3% to-date versus being up 5.0-6.0% for the same time period in the prior year. Sales momentum after this past weekend appears to have returned to more normal levels. At this time I would anticipate that second quarter same-store sales increase will be in the flat to up 1% range. Based on this and the benefits of lowering the cost of doing business over the last quarter, we are comfortable with the current consensus analyst estimate for second quarter earnings of $0.21. We remain focused on what is important and that is providing Wow food and Wow service in sparkling clean restaurants to each guest. We have a strong balance sheet, dedicated team members, proven strategies and procedures and believe that maintaining our focus on operations will allow us to come out of any slow down in a position of strength."

    First Quarter Highlights:

    * Earnings per share increased 30.0% to $0.26 from $0.20.
    * Net income increased 30.7% to $16,841,000 from $12,889,000.
    * System-wide Ruby Tuesday revenue increased 16.9% to $279,339,000 from
      $238,919,000.
    * System-wide same-store sales for Ruby Tuesday restaurants increased
      2.2%.
    * Average unit volumes increased 3.0% and same-store sales increased 2.0%
      at Company-owned Ruby Tuesday restaurants.
    * 14 Company-owned Ruby Tuesday restaurants were opened and 4 were closed,
      including one sold to an existing franchise partner.
    * Eight franchise units were opened, including one bought by an existing
      franchise partner, and one was closed.
    * The Company purchased 201,000 shares of its common stock during the
      quarter.  The Company has 7.2 million shares remaining authorized for
      repurchase under its ongoing share repurchase program.

As of September 4, 2001, Ruby Tuesday, Inc. owned and operated 384 Ruby Tuesday restaurants located in 26 states. Franchise operations included 156 domestic units and 14 international units. Ruby Tuesday, Inc. is traded on the New York Stock Exchange (Symbol: RI).

    For more information, contact:           Phone:    865-379-5700
    Price Cooper
    Vice President, Investor Relations and Planning

The Company will host a conference call which will be a live web-cast this afternoon at 2:30 Eastern Time. The call will be available live at the following web-sites:

http://www.videonewswire.com/event.asp?id=1213

http://www.rubytuesday.com/company/investorrelations.htm

The call will be archived on both sites through the close of business on October 10, 2001.

Special Note Regarding Forward-Looking Information

This press release contains various "forward-looking statements" which represent the Company's expectations or beliefs concerning future events, including the following: future financial performance and unit growth (both Company-owned and franchised), future capital expenditures, future borrowings and repayment of debt, and payment of dividends. The Company cautions that a number of important factors could, individually or in the aggregate, cause actual results to differ materially from those included in the forward-looking statements, including, without limitation, the following: consumer spending trends and habits; mall-traffic trends; increased competition in the casual dining restaurant market; weather conditions in the regions in which Company- owned and franchised restaurants are operated; consumers' acceptance of the Company's development prototypes; laws and regulations affecting labor and employee benefit costs; costs and availability of food and beverage inventory; the Company's ability to attract qualified managers and franchisees; changes in the availability of capital; and general economic conditions.

    RUBY TUESDAY, INC.
    Financial Results For the First Quarter of Fiscal Year 2002 (unaudited)
    (Amounts in thousands except per share amounts)





                                  13 Weeks           13 Weeks
                                   Ended    Percent   Ended   Percent
                                  Sept. 4,    of     Sept. 3,    of    Percent
                                   2001      Sales    2000     Sales   Change
    System-Wide Ruby Tuesday Sales:
    Company-owned Ruby Tuesday
     revenue                    $ 199,692          $ 173,067
    Franchised revenue             79,647             65,852
        Total system-wide sales $ 279,339          $ 238,919            16.9

    Revenues:
      Ruby Tuesday              $ 199,692    98.4  $ 173,067   85.1
       Other concepts                  --     0.0     27,584   13.5
         Company restaurant
          revenues                199,692    98.4    200,651   98.6     (0.5)
       Franchise income             3,292     1.6      2,787    1.4
          Total operating
           revenues               202,984   100.0    203,438  100.0     (0.2)

    Operating Costs and Expenses:
       (as a percent of Company
        restaurant revenues)
          Cost of merchandise      53,369    26.7     54,777   27.3
          Payroll and related
           costs                   64,737    32.4     65,123   32.5
          Other                    40,368    20.2     40,432   20.2
          Depreciation and
           amortization             8,084     4.0      9,691    4.8
       (as a percent of Total
        operating revenues)
          Selling, general and
           administrative          11,608     5.7     13,701    6.7
    Total operating costs and
     expenses                     178,166            183,724

    Earnings before Interest, Taxes
     and cumulative effect of
     change in accounting
     principle                     24,818    12.2     19,714    9.7     25.9

     Interest income, net          (1,383)   (0.7)      (362)  (0.2)

     Provision for income taxes     9,302     4.6      7,187    3.5

    Income before cumulative effect
     of change in accounting
     principle                     16,899     8.3     12,889    6.3

    Cumulative effect of change in
     accounting principle, net         58     0.0         --    0.0

    Net Income                  $  16,841     8.3   $ 12,889    6.3     30.7

    Earnings Per Share:

    Before cumulative effect of
     change in accounting principle:
    Basic                       $    0.27           $   0.21            28.6
    Diluted                     $    0.26           $   0.20            30.0

    After cumulative effect of
     change in accounting principle:
    Basic                       $    0.27           $   0.21            28.6
    Diluted                     $    0.26           $   0.20            30.0

    Shares:
    Basic                          63,245             61,907
    Diluted                        65,187             64,258


    RUBY TUESDAY, INC.

    Financial Results For the First Quarter
    of Fiscal Year 2002 (unaudited)
    (Amounts in thousands except per share amounts)

                                                September 4,      June 5,
    CONDENSED BALANCE SHEETS                       2001            2001
    Assets
      Cash and Short-Term Investments           $  10,621       $  10,636
      Accounts and Notes Receivable                 7,917           6,754
      Inventories                                   9,558           9,372
      Prepaid Income Taxes                            847              64
      Assets Held for Disposal                     21,542          22,197
      Other Current Assets                          6,081          15,397

       Total Current Assets                        56,566          64,420

      Property and Equipment, Net                 299,663         290,135
      Goodwill, Net                                 7,845           7,845
      Notes Receivable, Net                        58,751          56,881
      Other Assets                                 28,861          26,386

       Total Assets                             $ 451,686       $ 445,667

    Liabilities
      Current Liabilities                       $  74,077       $  88,433
      Long-Term Debt                               13,079          15,212
      Deferred Income Taxes                         3,811           4,127
      Other Deferred Liabilities                   59,803          53,624

       Total Liabilities                          150,770         161,396

    Shareholders' Equity                          300,916         284,271

       Total Liabilities and
        Shareholders' Equity                    $ 451,686       $ 445,667


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SOURCE Ruby Tuesday, Inc.
Web site: http: //www.rubytuesday.com/company/investorrelations.htm
CONTACT: Price Cooper, Vice President, Investor Relations and Planning of Ruby Tuesday, Inc., +1-865-379-5700
Audio: http: //www.videonewswire.com/event.asp?id=1213