<< Back

Ruby Tuesday, Inc. Reports Second Quarter Earnings Per Share Growth of 31%

01/08/2001

MARYVILLE, Tenn., Jan. 8 /PRNewswire/ -- Ruby Tuesday, Inc., (NYSE: RI) one of America's leading companies in the fast-growing casual dining segment of the restaurant industry, today reported results for its second quarter ended December 3, 2000. Earnings per share were $0.17, up 31% from $0.13 a year ago. This marks the eleventh consecutive quarter, and the seventeenth out of nineteen previous quarters, of earnings per share growth in excess of 20%. Net income of $11.0 million for the quarter was up 30% from $8.4 million a year ago. Pre-tax margin of 8.7% was 190 basis points higher than the prior year. Same-store sales at Company-owned Ruby Tuesday(R) restaurants increased 2.8%, while average unit volumes increased 4.3% for the quarter. In addition, the Board of Directors declared a semi-annual cash dividend of $0.0225 per share, payable on February 9, 2001, to shareholders of record at the close of business on January 26, 2001. As previously announced, during the quarter the Company completed the sale of its American Cafe(R) and Tia's(R) Tex-Mex concepts to Specialty Restaurant Group, LLC.

Sandy Beall, the Company's Chairman and CEO, commented, "Ruby Tuesday, Inc. has continued its positive trend for yet another quarter. The investments we have made over the last four years in our teams, training and training facilities are generating returns in the form of lower turnover and greater team and guest satisfaction. Our managing partner program, which is in place in over 55% of our units, continues to yield strong results in terms of sales and operating profits. Our domestic franchise partner program, which continues to add significant value, allows us the opportunity to enhance our growth while minimizing risk. Ruby Tuesday has a strong management team, proven strategies and results, and tremendous new unit growth opportunities. We have a four-year history of consistent and predictable results, and the strategies and financial resources to respond to any near-term pressures."

Beall continued, "Ruby Tuesday is a strong brand operating in the bar-and- grill category of casual dining. We believe that casual dining, and in particular our category, is the strongest sector of the restaurant industry. Positive demographic trends and lifestyle patterns support continued growth for many years to come. With our solid balance sheet and more than 25 years of experience, Ruby Tuesday is poised for continued growth well into the future."

Outlook for Remainder of Fiscal 2001

Based on current business trends, the Company reiterates its previously stated goal of 20-25% earnings per share growth for fiscal 2001 (excluding the $0.15 per share charge recorded in fiscal 2000 in conjunction with the now completed sale of American Cafe and Tia's). As previously stated, the Company's same-store sales growth goal for its third and fourth quarters of fiscal 2001 is approximately 2.0%. The Company is comfortable with the current consensus analyst estimate for third quarter earnings per share of $0.26.

    Second Quarter Highlights:

    * Earnings per share increased 30.8% to $0.17 from $0.13.  Earnings per
      share has grown at or in excess of 20% in each of the last eleven
      quarters.
    * Net income increased 30.2% to $10,982,000 from $8,432,000.
    * Average unit volumes increased 4.3% and same-store sales increased 2.8%
      for Company-owned Ruby Tuesday restaurants.  System-wide same-store
      sales for Company-owned and domestic franchise partner Ruby Tuesday
      restaurants increased 2.5%.
    * System-wide revenue increased 12.0% to $259,947,000 from $232,002,000.
    * The Company completed the previously announced sale of its 69 American
      Cafe and Tia's Tex-Mex restaurants to Specialty Restaurant Group, LLC
      (SRG).
    * 15 Company-owned Ruby Tuesday restaurants were opened.
    * 11 Company-owned Ruby Tuesday restaurants were closed including six
      which were sold to a new franchise partner.
    * 13 franchise units were opened (six of which were former Company-owned
      Ruby Tuesday restaurants sold to a new franchise partner).

    Year-to-Date Highlights:

    * Earnings per share increased 27.6% to $0.37 from $0.29.
    * Net income increased 27.4% to $23,871,000 from $18,732,000.
    * System-wide revenue increased 13.5% to $528,022,000 from $465,232,000.
    * Same-store sales increased 2.4% for Company-owned Ruby Tuesday
      restaurants.  System-wide same-store sales for Company-owned and
      domestic franchise partner Ruby Tuesday restaurants increased 2.0%.
    * Pre-tax profit margin increased 180 basis points from 7.5% to 9.3%.
    * 27 Company-owned Ruby Tuesday and three Tia's Tex-Mex restaurants were
      opened.
    * 13 Company-owned Ruby Tuesday restaurants were closed (six of which were
      sold to a new franchise partner).
    * 19 franchise units were opened (six of which were former Company-owned
      Ruby Tuesday restaurants sold to a new franchise partner) and one was
      closed.

As of December 3, 2000, Ruby Tuesday, Inc. owned and operated 350 Ruby Tuesday restaurants located in 26 states. Franchised operations included 154 domestic units and 10 international units. Ruby Tuesday, Inc. is traded on the New York Stock Exchange (Symbol: RI).

The Company will host a conference call which will be a live web-cast this afternoon at 2:00 Eastern Time. The call will be available live at the following web-sites:

http://www.videonewswire.com/RUBY/010801

http://www.ruby-tuesday.com/company/investorrelations.htm

The call will be archived on both sites through the close of business on January 22, 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 concepts; 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 Second Quarter of Fiscal Year 2001 (unaudited)
    (Amounts in thousands except per share amounts)



                             13 Weeks             13 Weeks
                               Ended                Ended
                            December 3, Percent  December 5, Percent  Percent
                               2000     of Sales    1999     of Sales  Change
    System-Wide Sales:
    Company-owned revenue   $ 193,864            $ 191,995
    Franchised revenue         66,083               40,007
      Total system-wide
       sales                $ 259,947            $ 232,002               12.0

    Revenues:
     Ruby Tuesday           $ 171,497     87.2   $ 165,828      85.6
     Other concepts            22,367     11.4      26,167      13.5
      Company restaurant
       revenues               193,864     98.6     191,995      99.1      1.0
     Franchise income           2,838      1.4       1,784       0.9
      Total operating
       revenues               196,702    100.0     193,779     100.0      1.5

    Operating Costs and Expenses:
     (as a percent of Company
      restaurant revenues)
       Cost of merchandise     52,984     27.3      52,389      27.3
       Payroll and related
        costs                  63,320     32.7      62,346      32.5
       Other restaurant
        operating costs        39,750     20.5      40,249      21.0
       Depreciation and
        amortization            9,248      4.8      10,331       5.4
     (as a percent of Total
      operating revenues)
       Selling, general and
        administrative         14,358      7.3      14,814       7.6
     Total operating costs and
      expenses                179,660              180,129

    Earnings before Interest and
     Taxes
      (EBIT)                   17,042      8.7      13,650       7.0     24.8

    Interest expense (net)        (64)     0.0         499       0.3

    Provision for income
     taxes                      6,124      3.1       4,719       2.4

    Net Income              $  10,982      5.6    $  8,432       4.4     30.2

    Earnings Per Share:
    Basic                   $    0.17             $   0.14               21.4
    Diluted                 $    0.17             $   0.13               30.8

    Shares:
    Basic                      62,291               62,342
    Diluted                    64,483               64,448


    RUBY TUESDAY, INC.

    Financial Results For the Second Quarter of Fiscal Year 2001 (unaudited)
    (Amounts in thousands except per share amounts)


                             26 Weeks             26 Weeks
                               Ended                Ended
                            December 3, Percent  December 5, Percent  Percent
                               2000     of Sales    1999     of Sales  Change

    System-Wide Sales:
    Company-owned revenue   $ 396,087            $ 385,584
    Franchised revenue        131,935               79,648
      Total system-wide
       sales                $ 528,022            $ 465,232               13.5

    Revenues:
     Ruby Tuesday           $ 346,109     86.2   $ 333,474      85.7
     Other concepts            49,978     12.4      52,110      13.4
      Company restaurant
       revenues               396,087     98.6     385,584      99.1      2.7
     Franchise income           5,625      1.4       3,480       0.9
      Total operating
       revenues               401,712    100.0     389,064     100.0      3.3

    Operating Costs and Expenses:
     (as a percent of Company
      restaurant revenues)
       Cost of merchandise    107,761     27.2     105,381      27.3
       Payroll and related
        costs                 128,443     32.4     123,962      32.1
       Other restaurant
        operating costs        80,178     20.2      80,634      20.9
       Depreciation and
        amortization           18,939      4.8      20,692       5.4
     (as a percent of Total
       operating revenues)
        Selling, general and
         administrative        29,635      7.4      28,164       7.2
    Total operating costs and
     expenses                 364,956              358,833

    Earnings before Interest and
     Taxes (EBIT)              36,756      9.1      30,231       7.8     21.6

     Interest expense (net)      (426)    (0.1)        919       0.2

     Provision for income
      taxes                    13,311      3.3      10,580       2.7

    Net Income              $  23,871      5.9   $  18,732       4.8     27.4

    Earnings Per Share:
    Basic                   $    0.38            $    0.30               26.7
    Diluted                 $    0.37            $    0.29               27.6

    Shares:
    Basic                      62,099               63,152
    Diluted                    64,370               65,364



    RUBY TUESDAY, INC.

    Financial Results For the Second Quarter
    of Fiscal Year 2001 (unaudited)
    (Amounts in thousands except per share amounts)

                                            December 3,        June 4,
    CONDENSED BALANCE SHEETS                   2000             2000
    Assets
     Cash and Short-Term Investments         $9,337           $10,154
     Accounts and Notes Receivable           12,167             6,880
     Inventories                              8,545             9,378
     Prepaid Income Taxes                     7,995               312
     Assets Held for Disposal                 3,854            59,057
     Other Current Assets                     6,216             8,674

      Total Current Assets                   48,114            94,455

     Property and Equipment, Net            291,604           281,865
     Costs in Excess of Net Assets
      Acquired                                8,037             8,229
     Notes Receivable, Net                   51,152            23,126
     Deferred Income Taxes                    1,849             5,355
     Other Assets                            29,496            26,182

      Total Assets                         $430,252          $439,212

    Liabilities
     Current Liabilities                    $77,270          $151,796
     Long-Term Debt                          37,566               636
     Other Deferred Liabilities              57,788            56,956

      Total Liabilities                     172,624           209,388

    Shareholders' Equity                    257,628           229,824

      Total Liabilities and
       Shareholders' Equity                $430,252          $439,212

SOURCE Ruby Tuesday, Inc.
Web site: http: //www.ruby-tuesday.com
CONTACT: Russell Mothershed, Sr. Vice President and Chief Financial Officer, or Price Cooper, Director, Investor Relations and Planning, of Ruby Tuesday, Inc., 865-379-5700