• Home:
• News:
• Buffalo Wild Wings:

Buffalo Wild Wings, Inc. Announces First Quarter Earnings Per Share of $0.98 and Quarterly Net Earnings Growth of over 22%

By: Buffalo Wild Wings |  1 Shares     99 Reads

MINNEAPOLIS--(BUSINESS WIRE)-- Buffalo Wild Wings, Inc. (NASDAQ: BWLD), announced today financial results for the first quarter ended March 25, 2012. Highlights for the first quarter versus the same period a year ago were:

• Total revenue increased 37.9% to $251.1 million
• Company-owned restaurant sales grew 40.3% to $232.3 million
• Same-store sales increased 9.2% at company-owned restaurants and 7.3% at franchised restaurants
• Net earnings increased 22.8% to $18.2 million from $14.9 million, and earnings per diluted share increased 21.0% to $0.98 from $0.81

Sally Smith, President and Chief Executive Officer, commented, "We are pleased with our solid start in 2012, with first quarter same-store sales increases of 9.2% at company-owned restaurants and 7.3% at franchised locations. The combination of strong same-store sales, new restaurant performance, and sales from franchised restaurants acquired in 2011 fueled our substantial revenue increase of 37.9%. We continued to invest in the infrastructure necessary to support our expansion in North America and internationally. Through leveraging expenses at the restaurant level, we limited the impact of higher wing costs. For the first quarter, we achieved net earnings growth of over 22%, and provided value to our shareholders with earnings per diluted share of $0.98."

Total revenue increased 37.9% to $251.1 million in the first quarter compared to $182.2 million in the first quarter of 2011. Company-owned restaurant sales for the quarter increased 40.3% over the same period in 2011, to $232.3 million, driven by a company-owned same-store sales increase of 9.2% and 64 additional company-owned restaurants at the end of first quarter 2012 relative to the same period in 2011. Franchise royalties and fees increased 13.1% to $18.8 million for the quarter versus $16.6 million in the first quarter of 2011. This increase is attributed to a franchise same-store sales increase of 7.3% and 17 additional franchised restaurants at the end of the period versus a year ago.

Average weekly sales for company-owned restaurants were $55,131 for the first quarter of 2012 compared to $48,845 for the same quarter last year, a 12.9% increase. Franchised restaurants averaged $57,282 for the period versus $52,744 in the first quarter a year ago, an 8.6% increase.

For the first quarter, net earnings increased 22.8% to $18.2 million versus $14.9 million in the first quarter of 2011. Earnings per diluted share were $0.98, as compared to first quarter 2011 earnings per diluted share of $0.81.

2012 Outlook

Ms. Smith remarked, "For the first four weeks of the second quarter, same-store sales are 6.7% at company-owned restaurants and 6.6% at our franchised locations. We're increasing our advertising over last year with national radio to cover all of our markets and we're airing a new TV spot. Our Operations Excellence team remains keenly focused on the fundamentals of providing great service to our guests and driving restaurant-level profitability. With solid first quarter results, ongoing same-store sales strength, the benefit of a 53rd week, and expense leveraging, we believe we will achieve our net earnings growth goal of 20% for 2012."

Ms. Smith concluded, "We continue to implement strategies for long-term growth. Our plans include a development pace to achieve 1,500 locations in North America in the next five to seven years. We're also actively pursuing international franchising opportunities and investigating potential concepts for acquisition that would provide additional growth. We are innovating around the critical aspects of the Buffalo Wild Wings brand, including our facilities, food and beverage, sports and entertainment, technology, and our service strategy. We believe that with a dedicated focus on our Guest experience and unit-level profitability, we will prudently expand our presence across the globe and generate industry-leading net earnings growth well into the future."

Buffalo Wild Wings will be hosting a conference call today, April 24, 2012 at 4:00 p.m. Central Daylight Time to discuss these results. There will be a simultaneous webcast conducted at our website www.buffalowildwings.com.

A replay of the call will be available until May 1, 2012. To access this replay, please dial 1.858.384.5517 password 4530757.

About the Company

Buffalo Wild Wings, Inc., founded in 1982 and headquartered in Minneapolis, Minnesota, is a growing owner, operator and franchisor of Buffalo Wild Wings Grill & Bar™ restaurants featuring a variety of boldly-flavored, made-to-order menu items including its namesake Buffalo, New York-style chicken wings. The Buffalo Wild Wings' menu specializes in eighteen mouth-watering signature sauces and seasonings with flavor sensations ranging from Sweet BBQ™ to Blazin'®. Guests enjoy a welcoming neighborhood atmosphere that includes an extensive multi-media system for watching their favorite sporting events. Buffalo Wild Wings is the recipient of hundreds of "Best Wings" and "Best Sports Bar" awards from across the country. There are currently more than 835 Buffalo Wild Wings locations across 48 states in the United States, as well as in Canada.

Forward-looking Statements

Various remarks we make about future expectations, plans, and prospects for the company constitute forward-looking statements for purposes of the Safe Harbor provisions under the Private Securities Litigation Reform Act of 1995. These statements relate to our future financial and store performance measures and growth goals for 2012 and beyond, including but not limited to those relating to our second quarter sales trends and projected unit and net earnings growth rates for 2012 and beyond. All statements other than statements of historical fact are statements that could be deemed forward-looking statements and are based upon the current beliefs and expectations of our management. We have attempted to identify forward-looking statements by terminology, including "anticipates," "believes," "can," "continue," "could," "estimates," "expects," "intends," "may," "plans," "potential," "predicts," "should" or "will" or the negative of these terms or other comparable terminology. Actual results may vary materially from those contained in forward-looking statements based on a number of factors, including, but not limited to, our ability to achieve and manage our planned expansion, the ability of our franchisees to open and manage new restaurants, market acceptance in the new geographic regions we enter (particularly non-U.S. locations), unforeseen obstacles in developing nontraditional sites or non-U.S. locations, our ability to obtain and maintain licenses and permits necessary to operate our existing and new restaurants, our franchisees' adherence to our practices, policies and procedures, the cost of commodities such as traditional chicken wings, the success of our key initiatives and our advertising and marketing campaigns, our ability to control restaurant labor and other restaurant operating costs, the continued service of key management personnel, our ability to protect our name and logo and other proprietary information, economic conditions (including changes in consumer preferences or consumer discretionary spending), the impact of federal, state or local government regulations relating to our employees, the sale of food and alcoholic beverages, the effect of competition in the restaurant industry, and other factors disclosed from time to time in our filings with the U.S. Securities and Exchange Commission, including the factors described under "Risk Factors" in Part I, Item 1A of our Annual Report on Form 10-K for the fiscal year ended December 25, 2011, as updated in subsequent reports filed with the SEC. Investors should take such risks into account when making investment decisions. Shareholders and other readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date on which they are made. We undertake no obligation to update any forward-looking statements.

BUFFALO WILD WINGS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
(Dollar and share amounts in thousands except per share data)
(unaudited)

			Three months ended
			March 25,				March 27,
			2012				2011
Revenue:
Restaurant sales			$	232,316			165,527
Franchise royalties and fees				18,806			16,623
Total revenue				251,122			182,150
Costs and expenses:
Restaurant operating costs:
Cost of sales				72,151			46,264
Labor				68,268			48,878
Operating				32,797			24,549
Occupancy				12,800			10,227
Depreciation and amortization				15,531			11,022
General and administrative				19,424			16,292
Preopening				2,591			2,387
Loss on asset disposals and store closures				737			411
Total costs and expenses				224,299			160,030
Income from operations				26,823			22,120
Investment income				410			356
Earnings before income taxes				27,233			22,476
Income tax expense				8,988			7,615
Net earnings			$	18,245			14,861
Earnings per common share — basic			$	0.98			0.81
Earnings per common share — diluted				0.98			0.81
Weighted average shares outstanding — basic				18,555			18,306
Weighted average shares outstanding — diluted				18,638			18,375

The following table expresses results of operations as a percentage of total revenue for the periods presented, except for restaurant operating costs which are expressed as a percentage of restaurant sales:

			Three months ended
			March 25,				March 27,
			2012				2011
Revenue:
Restaurant sales			92.5	%			90.9	%
Franchising royalties and fees			7.5				9.1
Total revenue			100.0				100.0
Costs and expenses:
Restaurant operating costs:
Cost of sales			31.1				27.9
Labor			29.4				29.5
Operating			14.1				14.8
Occupancy			5.5				6.2
Depreciation and amortization			6.2				6.1
General and administrative			7.7				8.9
Preopening			1.0				1.3
Loss on asset disposals and store closures			0.3				0.2
Total costs and expenses			89.3				87.9
Income from operations			10.7				12.1
Investment income			0.2				0.2
Earnings before income taxes			10.8				12.3
Income tax expense			3.6				4.2
Net earnings			7.3	%			8.2	%

BUFFALO WILD WINGS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Dollar amounts in thousands)
(unaudited)

			March 25,					December 25,
			2012					2011
Assets
Current assets:
Cash and cash equivalents			$	27,342				20,530
Marketable securities				44,141				39,956
Accounts receivable, net of allowance of$25				16,166				12,165
Inventory				6,228				6,311
Prepaid expenses				3,439				3,707
Refundable income taxes				—				7,561
Deferred income taxes				6,663				6,323
Restricted assets				32,797				42,692
Total current assets				136,776				139,245
Property and equipment, net				312,585				310,170
Other assets				27,404				28,174
Goodwill				17,770				17,770
Total assets			$	494,535				495,359
Liabilities and Stockholders' Equity
Current liabilities:
Unearned franchise fees			$	1,701				1,852
Income tax payable				1,296				—
Accounts payable				22,831				30,089
Accrued compensation and benefits				27,405				30,499
Accrued expenses				9,627				7,580
Current portion of deferred lease credits				367				—
System-wide payables				32,919				44,250
Total current liabilities				96,146				114,270
Long-term liabilities:
Other liabilities				1,605				1,544
Deferred income taxes				38,141				38,512
Deferred lease credits, net of current portion				23,149				23,047
Total liabilities				159,041				177,373
Commitments and contingencies
Stockholders' equity:
Undesignated stock, 1,000,000 shares authorized				—				—
Common stock, no par value. Authorized 44,000,000 shares; issued and outstanding 18,564,152 and 18,377,920 respectively				112,637				113,509
Retained earnings				223,017				204,772
Accumulated other comprehensive loss				(160	)			(295	)
Total stockholders' equity				335,494				317,986
Total liabilities and stockholders' equity			$	494,535				495,359

BUFFALO WILD WINGS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollar amounts in thousands)
(unaudited)

			Three months ended
			March 25,					March 27,
			2012					2011
Cash flows from operating activities:
Net earnings			$	18,245				14,861
Adjustments to reconcile net earnings to cash provided by operations:
Depreciation				14,852				10,871
Amortization				679				151
Loss on asset disposals and store closures				723				411
Deferred lease credits				838				802
Deferred income taxes				(711	)			2,806
Stock-based compensation				1,232				2,553
Excess tax benefit from the exercise of stock options				(259	)			(140	)
Change in operating assets and liabilities:
Trading securities				(519	)			(289	)
Accounts receivable				(5,676	)			(2,796	)
Inventory				85				39
Prepaid expenses				270				425
Other assets				72				(468	)
Unearned franchise fees				(151	)			5
Accounts payable				(934	)			2,236
Income taxes				9,116				3,777
Accrued expenses				4,378				4,565
Net cash provided by operating activities				42,240				39,809
Cash flows from investing activities:
Acquisition of property and equipment				(23,845	)			(18,746	)
Purchase of marketable securities				(19,669	)			(27,185	)
Proceeds of marketable securities				16,003				23,401
Net cash used in investing activities				(27,511	)			(22,530	)
Cash flows from financing activities:
Issuance of common stock				256				168
Excess tax benefit from the exercise of stock options				259				140
Tax payments for restricted stock				(8,447	)			(2,481	)
Net cash used in financing activities				(7,932	)			(2,173	)
Effect of exchange rate changes on cash and cash equivalents				15				(4	)
Net increase in cash and cash equivalents				6,812				15,102
Cash and cash equivalents at beginning of period				20,530				15,309
Cash and cash equivalents at end of period			$	27,342				30,411

BUFFALO WILD WINGS, INC. AND SUBSIDIARIES
Supplemental Information

Restaurant Count
Company-owned Restaurants:
			Q1				Q2				Q3				Q4
2012			327
2011			263				277				288				319
2010			235				234				244				259
2009			206				215				220				232
2008			165				169				187				197
Franchised Restaurants:
			Q1				Q2				Q3				Q4
2012			505
2011			488				492				498				498
2010			430				447				457				473
2009			373				383				400				420
2008			340				346				348				363
Same-Store Sales
Company-owned Restaurants:
			Q1				Q2				Q3				Q4				Year
2012			9.2	%
2011			3.9	%			5.9	%			5.7	%			8.9	%			6.1	%
2010			0.1	%			(0.1	%)			2.6	%			(0.3	%)			0.6	%
2009			6.4	%			2.8	%			0.8	%			2.6	%			3.1	%
2008			4.1	%			8.3	%			6.8	%			4.5	%			5.9	%
Franchised Restaurants:
			Q1				Q2				Q3				Q4				Year
2012			7.3	%
2011			1.6	%			2.7	%			4.2	%			5.9	%			3.6	%
2010			0.7	%			(0.7	%)			0.3	%			(1.1	%)			(0.2	%)
2009			6.0	%			3.7	%			1.9	%			2.0	%			3.4	%
2008			2.1	%			4.5	%			2.1	%			2.5	%			2.8	%

Average Weekly Sales Volumes
Company-owned Restaurants:
			Q1				Q2			Q3			Q4			Year
2012			$	55,131
2011				48,845			47,970			49,461			51,983			49,627
2010				45,327			43,021			44,394			45,595			44,601
2009				45,593			42,938			42,602			44,583			43,912
2008				41,438			40,572			42,400			43,864			42,141
Franchised Restaurants:
			Q1				Q2			Q3			Q4			Year
2012			$	57,282
2011				52,744			50,995			51,350			53,385			52,081
2010				51,532			49,051			49,005			49,837			49,835
2009				50,729			48,619			48,458			50,115			49,479
2008				47,812			46,390			46,889			48,424			47,382

Source: Buffalo Wild Wings, Inc.

###

Comments:

comments powered by Disqus