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Ruby Tuesday, Inc. Reports Third Quarter Earnings Per Share Growth of 33% and Record Same-Store Sales Growth of 6.5%

04/10/2001

MARYVILLE, Tenn., April 10 /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 third quarter ended March 4, 2001. Earnings per share were $0.28, up 33% from $0.21 a year ago. This marks the twelfth consecutive quarter of earnings per share growth in excess of 20%. The growth was largely attributable to same-store sales growth of 6.5% and an average unit volume increase of 7.5% for the quarter at Company-owned Ruby Tuesday(R) restaurants. Net income of $18.2 million for the quarter was also up 33% from $13.7 million a year ago. Pre-tax margin of 14.8% was 460 basis points higher than the prior year.

Sandy Beall, the Company's Chairman and CEO, commented, "In addition to completing one of the best quarters ever, Ruby Tuesday, Inc. has now completed five years of outstanding performance-both operationally and financially. The considerable investments in our teams and our systems have paved the way for these results. Programs implemented during the last five years, such as the franchise partner program, the managing partner program, and our on-site training facilities, have been and will continue to be major contributing factors to our success. Each of these is part of our overall strategy for minimizing risk while maximizing results and, in addition to maintaining a strong balance sheet, is instrumental in sustaining our long-term success."

Outlook for Remainder of Fiscal 2001

Based on current business trends and its third quarter results, the Company's earnings per share growth goal for fiscal 2001 (excluding the $0.15 per share charge recorded in fiscal 2000 in conjunction with the previously completed sale of the American Cafe and Tia's Tex-Mex restaurants) is approximately 25%. The Company is comfortable with the current consensus of analysts' estimates for fourth quarter earnings per share of $0.26. The Company's goal for same-store sales growth for its fourth quarter of fiscal 2001 is approximately 3.0%.

Outlook for Fiscal 2002

Based on current business trends, the Company's goal for fiscal year 2002 is 20% earnings per share growth and 2-3% same-store sales growth.

    Third Quarter Highlights:

    * Earnings per share increased 33.3% to $0.28 from $0.21.  Earnings per
      share have grown in excess of 20% in each of the last twelve quarters.
    * Net income increased 32.8% to $18,237,000 from $13,730,000.
    * Average unit volumes increased 7.5% and same-store sales increased 6.5%
      at Company-owned Ruby Tuesday restaurants.
    * System-wide Ruby Tuesday revenue increased 18.5% to $267,715,000 from
      $225,997,000.
    * Seven Company-owned Ruby Tuesday restaurants were opened.
    * One Company-owned Ruby Tuesday restaurant was closed due to lease
      expiration.
    * Five franchise units were opened and two were closed due to lease
      expirations.


    Year-to-Date Highlights:

    * Earnings per share increased 30.0% to $0.65 from $0.50.
    * Net income increased 29.7% to $42,108,000 from $32,462,000.
    * System-wide Ruby Tuesday revenue increased 16.7% to $745,759,000 from
      $639,119,000.
    * Same-store sales increased 3.8% at Company-owned Ruby Tuesday
      restaurants.
    * Pre-tax profit margin increased to 11.1%.
    * 34 Company-owned Ruby Tuesday restaurants were opened.
    * 14 Company-owned Ruby Tuesday restaurants were closed (six of which were
      sold to a new franchise partner).
    * 24 franchise units were opened (six of which were former Company-owned
      Ruby Tuesday restaurants sold to a new franchise partner) and three were
      closed.
    * The previously announced sale of the American Cafe and Tia's Tex-Mex
      restaurants was completed on November 20, 2000.

As of March 4, 2001, Ruby Tuesday, Inc. owned and operated 356 Ruby Tuesday restaurants located in 26 states. Franchised operations included 157 domestic units and 10 international units. Ruby Tuesday, Inc. is traded on the New York Stock Exchange (NYSE: RI).

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

The Company will host a conference call which will be a live web-cast this afternoon at 3:00 Eastern Time. The call will be available live at the following web-sites:

http://www.videonewswire.com/RUBY/041001

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

The call will be archived on both sites through the close of business on April 17, 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 Third Quarter of Fiscal Year 2001 (unaudited)
    (Amounts in thousands except per share amounts)



                               13 Weeks            13 Weeks
                                 Ended               Ended
                                March 4,  Percent   March 5, Percent Percent
                                  2001    of Sales    2000  of Sales  Change

    System-Wide Ruby Tuesday Sales:
    Company-owned Ruby Tuesday
     revenue                     $187,920            $178,891
    Franchised Ruby Tuesday
     revenue                       79,795              47,106
        Total system-wide Ruby
         Tuesday sales           $267,715            $225,997         18.5

    Revenues:
       Ruby Tuesday              $187,920    98.1    $178,891   85.5
       Other concepts                  --     0.0      28,269   13.5
          Company restaurant
           revenues               187,920    98.1     207,160   99.0  (9.3)
       Franchise income             3,560     1.9       2,062    1.0
          Total operating
           revenues               191,480   100.0     209,222  100.0  (8.5)

    Operating Costs and Expenses:
       (as a percent of Company
        restaurant revenues)
           Cost of merchandise     51,606    27.5      56,177   27.1
           Payroll and related
            costs                  58,118    30.9      64,715   31.2
           Other restaurant
            operating costs        33,189    17.7      41,978   20.3
           Depreciation and
            amortization            7,500     4.0      10,553    5.1
       (as a percent of Total
        operating revenues)
           Selling, general and
            administrative         14,118     7.4      13,779    6.6
    Total operating costs and
     expenses                     164,531             187,202

    Earnings before Interest and
     Taxes
      (EBIT                        26,949    14.1      22,020   10.5  22.4

       Interest (income)/expense,
        net                        (1,460)   (0.8)        603    0.3

       Provision for income taxes  10,172     5.3       7,687    3.7

    Net Income                    $18,237     9.5     $13,730    6.6  32.8

    Earnings Per Share:
    Basic                           $0.29               $0.21         38.1
    Diluted                         $0.28               $0.21         33.3

    Shares:
    Basic                          63,385              62,100
    Diluted                        65,518              63,898


    RUBY TUESDAY, INC.

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


                               39 Weeks            39 Weeks
                                 Ended               Ended
                                March 4,  Percent   March 5,  Percent  Percent
                                  2001   of Sales     2000   of Sales  Change

    System-Wide Ruby Tuesday
     Sales:
    Company-owned Ruby Tuesday
     revenue                     $534,029            $512,365
    Franchised Ruby Tuesday
     revenue                      211,730             126,754
        Total system-wide Ruby
         Tuesday sales           $745,759            $639,119          16.7

    Revenues:
       Ruby Tuesday              $534,029     90.0   $512,365   85.7
       Other concepts              49,978      8.5     80,379   13.4
          Company restaurant
           revenues               584,007     98.5    592,744   99.1   (1.5)
       Franchise income             9,185      1.5      5,542    0.9
          Total operating
           revenues               593,192    100.0    598,286  100.0   (0.9)

    Operating Costs and Expenses:
       (as a percent of Company
        restaurant revenues)
           Cost of merchandise    159,367     27.3    161,558   27.3
           Payroll and related
            costs                 186,561     31.9    188,677   31.8
           Other restaurant
            operating costs       113,367     19.4    122,612   20.7
           Depreciation and
            amortization           26,439      4.5     31,245    5.3
       (as a percent of Total
        operating revenues)
           Selling, general and
            administrative         43,753      7.4     41,943    7.0
    Total operating costs and
     expenses                     529,487             546,035

    Earnings before Interest and
     Taxes
      (EBIT                        63,705     10.7     52,251    8.7    21.9

       Interest (income)/expense,
        net                        (1,886)    (0.3)     1,522    0.3

       Provision for income taxes  23,483      4.0     18,267    3.1

    Net Income                    $42,108      7.1    $32,462    5.4    29.7

    Earnings Per Share:
    Basic                           $0.67               $0.51           31.4
    Diluted                         $0.65               $0.50           30.0

    Shares:
    Basic                          62,528              62,802
    Diluted                        64,753              64,876



    RUBY TUESDAY, INC.

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

                                                   March 4,          June 4,
    CONDENSED BALANCE SHEETS                         2001              2000
    Assets
     Cash and Short-Term Investments               $11,354           $10,154
     Accounts and Notes Receivable                   6,625             6,880
     Inventories                                     8,341             9,378
     Prepaid Income Taxes                            7,793               312
     Assets Held for Disposal                        3,853            59,057
     Other Current Assets                            6,226             8,674

       Total Current Assets                         44,192            94,455

     Property and Equipment, Net                   295,303           281,865
     Costs in Excess of Net Assets
      Acquired                                       7,941             8,229
     Notes Receivable, Net                          54,278            23,126
     Deferred Income Taxes                              --             5,355
     Other Assets                                   29,659            26,182

       Total Assets                               $431,373          $439,212

    Liabilities
     Current Liabilities                           $76,211          $151,796
     Long-Term Debt                                 15,527               636
     Deferred Income Taxes                           2,446                --
     Other Deferred Liabilities                     56,717            56,956

       Total Liabilities                           150,901           209,388

    Shareholders' Equity                           280,472           229,824

       Total Liabilities and
        Shareholders' Equity                      $431,373          $439,212

SOURCE Ruby Tuesday, Inc.
Web site: http: //www.rubytuesday.com
CONTACT: Price Cooper, Director, Investor Relations and Planning, Ruby Tuesday, Inc., 865-379-5700
Audio: http: //www.videonewswire.com/RUBY/041001