HOUSTON - Jan. 28, 2019 // PRNewswire // - Luby's, Inc. (NYSE: LUB) ("Luby's") today announced unaudited financial results for its sixteen-week first quarter fiscal 2019, which ended on December 19, 2018. Comparisons in this earnings release for the first quarter fiscal 2019 are referred to as "first quarter."
First Quarter Key Metrics
(comparisons to first quarter fiscal 2018)
Chris Pappas, President and CEO, commented, "Our turn-around of the business is underway. While sales pressure persisted in the first quarter, we reduced our food and operating costs at a greater percentage than the sales declined. In addition, we have taken substantial actions to restructure our corporate overhead that will result in more than $3.0 million of annual savings in selling, general, and administrative costs.
"We also continue to make positive progress with our property asset sales program, and as of this announcement, we have generated proceeds of $26.8 million, or about 60%, of our $45 million asset sales program. In addition, we refinanced our credit facility on December 13, 2018, providing $60.0 million of debt financing. As a result of this refinancing, we put close to $20.0 million of cash on the balance sheet ($8.7 million in available for use cash and another $11.1 million in restricted cash that has been set aside for future interest payments and other short term commitments). As of the date of this announcement, we have already repaid $9.1 million on our debt balance utilizing proceeds from the sale of property.
"Our new Chief Operating Officer, Todd Coutee, is leveraging his three decades of restaurant experience to increase efficiency throughout our operations. He is realigning our organization by getting the right people in the right positions, coaching restaurant managers and inspiring our front-line employees by setting the right tone and leading by example. This leadership is driving positive changes in our menu offering, marketing efforts and customer service initiatives.
"From a marketing perspective, we are deploying technology and making improvements in mobile ordering, utilizing third party delivery platforms, and other services, to meet the modern needs/desires of our customers. We are utilizing more measurable digital marketing campaigns in conjunction with traditional media outlets. Our intention is to highlight our differentiation with respect to our competitors"
"Subsequent to the first quarter, through January 20, 2019, our total same-store sales have turned to a positive 0.7% with our cafeteria brand achieving a robust positive 2.8% compared to same period last year.
"Lastly, we plan to re-franchise many of our company-owned Fuddruckers as we transition to primarily a franchise model for Fuddruckers, while retaining company-owned stores in our core market of Houston."
Same-Store Sales Year-Over-Year Comparison
First Quarter Restaurant Sales:
($ thousands)
Balance Sheet and Capital Expenditures
We ended the first quarter with a debt balance outstanding of $60.0 million, an increase from $39.5 million at the end of fiscal 2018. During the first quarter, our capital expenditures decreased to $1.1 million compared to $4.3 million in the first quarter fiscal 2018. At the end of the first quarter, we had $8.7 million in available cash, $11.1 million in restricted cash, and $108.1 million in total shareholders' equity. Since the inception of our $45.0 million asset sales program, we have generated proceeds of $26.8 million.
Restaurant Counts:
Conference Call
Luby's will host a conference call on January 28, 2019 at 10:00 a.m. Central Time to discuss further its first quarter fiscal 2019 results. To access the call live, dial (412) 902-0030 and use the access code 13686560# at least 10 minutes prior to the start time, or listen live over the Internet by visiting the events page in the investor relations section of www.lubysinc.com. For those who cannot listen to the live call, a telephonic replay will be available through February 4, 2019 and may be accessed by calling (201) 612-7415 and using the access code 13686560#. Also, an archive of the webcast will be available after the call for a period of 90 days on the "Investors" section of the Company's website.
Luby's, Inc. (NYSE: LUB) operates 140 restaurants nationally as of December 19, 2018: 82 Luby's Cafeterias, 57 Fuddruckers, one Cheeseburger in Paradise restaurants. Luby's is the franchisor for 103 Fuddruckers franchise locations across the United States (including Puerto Rico), Canada, Mexico, the Dominican Republic, Panama, and Colombia. Luby's Culinary Contract Services provides food service management to 30 sites consisting of healthcare, corporate dining locations, and sports stadiums.
This press release contains statements that are "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements contained in this press release, other than statements of historical fact, are "forward-looking statements" for purposes of these provisions, including the statements under the caption "Outlook" and any other statements regarding scheduled openings of units, scheduled closures of units, sales of assets, expected proceeds from the sale of assets, expected levels of capital expenditures, effects of food commodity costs, anticipated financial results in future periods and expectations of industry conditions.
Luby's cautions readers that various factors could cause its actual financial and operational results to differ materially from those indicated by forward-looking statements made from time-to-time in news releases, reports, proxy statements, registration statements, and other written communications, as well as oral statements made from time to time by representatives of Luby's. The following factors, as well as any other cautionary language included in this press release, provide examples of risks, uncertainties and events that may cause Luby's actual results to differ materially from the expectations Luby's describes in such forward-looking statements: general business and economic conditions; the impact of competition; our operating initiatives; fluctuations in the costs of commodities, including beef, poultry, seafood, dairy, cheese and produce; increases in utility costs, including the costs of natural gas and other energy supplies; changes in the availability and cost of labor; the seasonality of Luby's business; changes in governmental regulations, including changes in minimum wages; the effects of inflation; the availability of credit; unfavorable publicity relating to operations, including publicity concerning food quality, illness or other health concerns or labor relations; the continued service of key management personnel; and other risks and uncertainties disclosed in Luby's annual reports on Form 10-K and quarterly reports on Form 10-Q.
View Original for Full Data Table
The following table contains information derived from the Company's Consolidated Statements of Operations expressed as a percentage of sales. Percentages may not total due to rounding.
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Store Level Profit
Although store level profit, defined as restaurant sales plus vending revenue, less cost of food, payroll and related costs, other operating expenses, and occupancy costs, is a non-GAAP measure, we believe its presentation is useful because it explicitly shows the results of our most significant reportable segment. The following table reconciles between store level profit, a non-GAAP measure to loss from continuing operations, a GAAP measure:
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Adjusted EBITDA
Adjusted EBITDA is defined as income (loss) from continuing operations before interest, provision (benefit) for income taxes, and depreciation and amortization, and excluding net loss (gain) on disposing of property and equipment, provision for asset impairments and restaurant closings, non-cash compensation expense, franchise taxes, and decrease / (increase) in fair value of derivatives.
Adjusted EBITDA is intended as a supplemental measure of our performance that is not required by, or presented in accordance with GAAP. We believe Adjusted EBITDA provides useful information to management and investors in valuing the Company and evaluating ongoing operating results and trends and in comparing our results to other competitors. Our management uses Adjusted EBITDA in evaluating management's performance when determining incentive compensation.
Adjusted EBITDA, as defined, may not be comparable to other similarly titled measures as computed by other companies. These measures should be considered supplemental and not a substitute or superior to other GAAP performance measures.
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Rick Black / Ken Dennard
Dennard-Lascar Associates
Investor Relations
713-529-6600
SOURCE Luby's, Inc.
Luby's, Inc. operates 173 restaurants nationally: 91 Luby's Cafeterias, 73 Fuddruckers, 8 Cheeseburger in Paradise and one Bob Luby's Seafood Grill.