EX-99.2 4 dex992.htm PRESS RELEASE DATED 11/15/2002 Press Release dated 11/15/2002
 
EXHIBIT 99.2
NEWS BULLETIN
  
RE:                                       [WRC LOGO]
FROM:
  
WORLDWIDE
   
RESTAURANT CONCEPTS
FRB            WEBER SHANDWICK
    
                    FINANCIAL COMMUNICATIONS
  
15301 Ventura Blvd., Bldg B, Suite 300
   
Sherman Oaks, CA 91403
   
(818) 662-9800
   
NYSE: SZ
FOR FURTHER INFORMATION:
    
AT THE COMPANY:
  
AT FRB¦WEBER SHANDWICK:
Keith Wall
  
Kim Forster
  
James Hoyne
  
Tricia Ross
Vice President and CFO
  
Vice President, Planning
  
General Information
  
Investor/Analyst Contact
(818) 662-9800
  
(818) 662-9800
  
(310) 407-6546
  
(310) 407-6540
FOR IMMEDIATE RELEASE
 
November 15, 2002
 
WORLDWIDE RESTAURANT CONCEPTS, INC. ANNOUNCES SECOND
QUARTER FISCAL 2003 RESULTS
 
HIGHLIGHTS:
 
 
•
 
Total revenues increased by 7.5 percent to $64.4 million
 
 
•
 
Continued growth at Pat & Oscar’s, same store sales growth of 9.4 percent at Sizzler Australia and 5.9 percent at KFC, and favorable Australian dollar exchange rate drove revenue growth
 
 
•
 
Earnings per share increased to $0.05 per diluted share on revenue growth and reduced prime costs at all divisions
 
SHERMAN OAKS, Calif.—November 15, 2002—Worldwide Restaurant Concepts, Inc. (NYSE: SZ) today reported financial results for the second quarter of fiscal 2003, ended October 13, 2002.
For the second quarter, the Company reported revenues of $64.4 million, an increase of 7.5 percent over the $59.9 million in the comparable period in fiscal 2002. Net income for the quarter was $1.4 million, or $0.05 per diluted share, compared to net income of $355,000, or $0.01 per diluted share in the same period a year ago. Revenue growth from Pat & Oscar’s expansion, strong same store sales growth in Australia, strengthening of the Australian dollar exchange rate and improved cost controls contributed to the Company’s net income growth.
Total revenues for the twenty-four weeks ended October 13, 2002 were $132.1 million, an increase of $10.9 million or 9.0 percent over the comparable period last year. Year to date net income increased by $2.7 million, to $4.7 million, or $0.17 per diluted share, compared to $0.07 in the prior year.

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Worldwide Restaurant Concepts, Inc.
Page 2 of 7
 
Continued Revenue Growth and Cost Controls
 
For the second quarter, the Company grew total revenues by $4.5 million, a 7.5 percent increase over the prior year. The Company’s Australian operations continued to report strong sales, with a 9.4 percent increase in same store sales at Sizzler Australia. KFC reported a 5.9 percent increase in same store sales and added two new restaurants compared to the prior year.
 
Pat & Oscar’s reported revenues of $9.9 million for the second quarter. This represents an increase of $1.4 million or 16.7 percent over revenues in the comparable period last year. This growth reflects the impact of new units, offset in part by a decline of 4.0 percent in same store sales. Same store sales continue to be adversely affected by softness in the San Diego economy. Economic conditions have particularly affected Pat & Oscar’s catering business, which was down nearly 9 percent from prior year on a comparable store basis. Catering and other off-premise sales account for approximately 40 percent of Pat & Oscar’s sales.
 
In spite of the tough economic conditions during the quarter, Sizzler USA reported virtually unchanged customer counts compared to the comparable quarter last year. Lower than expected sales from the Steak Ranchera promotion featured during the quarter contributed to a 1.1 percent decline in same store sales. During the quarter, Sizzler USA appointed a Senior Vice President of Marketing and continued its testing of an exterior remodel program. The remodel, which costs under $50,000 per restaurant, has already been completed at eight restaurants. Based on positive early results, the Company expects to complete an additional twelve remodels by the end of fiscal 2003.
 
Outlook For Fiscal 2003
 
“This quarter, we continued to grow the top line and the bottom line in an uncertain economic environment. We were successful because we’ve continued to execute our strategies of investing in our brands and facilities and being disciplined in managing costs. In the coming quarters, we’ll continue on this course. We can’t control the economy, or the drought conditions that threaten to increase food costs in Australia, but we can and will focus on marketing and opening new restaurants, “ commented Charles Boppell, President and CEO of Worldwide Restaurant Concepts. The Company’s restaurant expansion plans include opening five to six new Pat & Oscar’s during fiscal 2003, including three in Los Angeles County that will mark the brand’s entry into the Los Angeles market.
 
Investor Conference Call
 
Worldwide Restaurant Concepts will be holding an investor conference call at 11:00 a.m. EST to discuss the Company’s financial and operational results. Investors will have the opportunity to listen to the conference call over the Internet at www.wrconcepts.com and www.companyboardroom.com. To listen to the live call, please go to either web site at least fifteen minutes early to register, download, and install any necessary audio software. For those who cannot listen to the live broadcast, a replay, also at www.wrconcepts.com and www.companyboardroom.com, will be available shortly after the call.

Worldwide Restaurant Concepts, Inc.
Page 3 of 7
 
About Worldwide Restaurant Concepts
 
Worldwide Restaurant Concepts, Inc., formerly known as Sizzler International, Inc., operates, franchises or joint ventures 322 Sizzler® restaurants worldwide, 109 KFC® restaurants primarily located in Queensland, Australia, and 15 Pat & Oscar’sSM restaurants.
 
Certain statements contained in this document may contain forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Act of 1995. These statements may include but are not limited to statements regarding: (i) continuing growth in revenues and earnings; (ii) completion of twenty exterior remodels at Sizzler USA during fiscal 2003; and (iii) the opening of five to six additional Pat & Oscar’sSM restaurants through the end of this fiscal year, including three locations in Los Angeles County.
 
Worldwide Restaurant Concepts cautions that these statements are qualified by important factors that could cause actual results to differ materially from those reflected in the forward looking statements contained herein. Such factors include, but are not limited to: (a) the Company’s ability to implement its strategic plan and manage its costs and expenses; (b) the ability to design marketing and product initiatives resulting in same store sales growth; (c) the availability of capital to upgrade the facilities at its domestic Sizzler® locations and build new Pat & Oscar’s restaurants; (d) Pat & Oscar’s ability to acquire a sufficient number of suitable sites to open five to six new restaurants this year; (e) economic conditions, both generally and as they affect the restaurant industry in particular; and (f) other risks as detailed from time to time in the Company’s SEC reports, including Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and Annual Reports on Form 10-K .
 
In the following financial tables, certain reclassifications have been made to the prior year amounts to conform to current year presentation.
 
[tables to follow ]

Worldwide Restaurant Concepts, Inc.
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WORLDWIDE RESTAURANT CONCEPTS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
FOR THE TWELVE WEEKS ENDED OCT. 13, 2002 AND OCT. 14, 2001
(In thousands, except per share data)
 
    
October 13, 2002
   
October 14, 2001
Revenues
              
Restaurant sales
   
$
62,493
   
$
58,025
Franchise revenues
   
 
1,944
   
 
1,918
    
  
Total revenues
   
 
64,437
   
 
59,943
    
  
Costs and Expenses
              
Cost of sales
   
 
21,089
   
 
19,756
Labor and related expenses
   
 
17,569
   
 
16,687
Other operating expenses
   
 
15,655
   
 
14,590
Depreciation and amortization
   
 
2,158
   
 
2,198
General and administrative expenses
   
 
5,370
   
 
5,300
    
  
Total operating costs
   
 
61,841
   
 
58,531
    
  
Operating income
   
 
2,596
   
 
1,412
    
  
Interest expense
   
 
803
   
 
803
Investment income
   
 
278
   
 
191
    
  
Income before provision for income taxes
   
 
2,071
   
 
800
    
  
Provision for income taxes
   
 
647
   
 
445
    
  
Net income
   
$
1,424
   
$
355
    
  
Basic and diluted earnings per share
   
$
0.05
   
$
0.01
    
  
 

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Worldwide Restaurant Concepts, Inc.
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WORLDWIDE RESTAURANT CONCEPTS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
FOR THE TWENTY-FOUR WEEKS ENDED OCT. 13, 2002 AND OCT. 14, 2001
(In thousands, except per share data)
 
    
October 13, 2002
   
October 14, 2001
Revenues
              
Restaurant sales
   
$
128,177
   
$
117,298
Franchise revenues
   
 
3,949
   
 
3,917
    
  
Total revenues
   
 
132,126
   
 
121,215
    
  
Costs and Expenses
              
Cost of sales
   
 
43,348
   
 
39,842
Labor and related expenses
   
 
35,757
   
 
33,586
Other operating expenses
   
 
31,265
   
 
28,979
Depreciation and amortization
   
 
4,329
   
 
4,358
General and administrative expenses
   
 
10,834
   
 
10,777
    
  
Total operating costs
   
 
125,533
   
 
117,542
    
  
Operating income
   
 
6,593
   
 
3,673
    
  
Interest expense
   
 
1,621
   
 
1,671
Investment income
   
 
469
   
 
412
Other income
   
 
—  
   
 
412
    
  
Income before provision for income taxes
   
 
5,441
   
 
2,826
    
  
Provision for income taxes
   
 
760
   
 
807
    
  
Net income
   
$
4,681
   
$
2,019
    
  
Basic and diluted earnings per share
   
$
0.17
   
$
0.07
    
  

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Worldwide Restaurant Concepts, Inc.
Page 6 of 7
 
WORLDWIDE RESTAURANT CONCEPTS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
 
    
October 13, 2002
   
April 30, 2002
ASSETS
              
Current Assets:
              
Cash and cash equivalents
   
$
22,951
   
$
25,943
Restricted cash
   
 
2,278
   
 
2,096
Receivables, net of an allowance of $850 at October 13, 2002 and $814 at April 30, 2002
   
 
2,662
   
 
2,101
Inventories
   
 
4,234
   
 
4,367
Deferred income tax asset
   
 
2,653
   
 
2,191
Prepaid expenses and other current assets
   
 
2,308
   
 
1,686
    
  
Total current assets
   
 
37,086
   
 
38,384
    
  
Property and equipment, net
   
 
62,061
   
 
61,334
Property held for sale, net
   
 
2,224
   
 
2,632
Long-term notes receivable (including $200 of related party receivables at October 13, 2002 and April 30, 2002), net of an allowance of $3 at October 13, 2002 and April 30, 2002
   
 
857
   
 
974
Deferred income tax asset
   
 
7,130
   
 
7,198
Goodwill, net
   
 
22,313
   
 
20,940
Intangible assets, net of accumulated amortization of $789 at October 13, 2002 and $734 at April 30, 2002
   
 
2,075
   
 
2,031
Other assets
   
 
1,708
   
 
1,866
    
  
Total assets
   
$
135,454
   
$
135,359
    
  
 

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Worldwide Restaurant Concepts, Inc.
Page 7 of 7
 
WORLDWIDE RESTAURANT CONCEPTS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except share data)
 
    
October 13, 2002
     
April 30, 2002
  
LIABILITIES AND STOCKHOLDERS’ EQUITY
                  
Current Liabilities:
                  
Current portion of long-term debt
   
$
6,029
 
   
$
5,971
 
Accounts payable
   
 
9,936
 
   
 
11,304
 
Other current liabilities
   
 
18,145
 
   
 
16,383
 
Income taxes payable
   
 
1,158
 
   
 
2,669
 
    
  
Total current liabilities
   
 
35,268
 
   
 
36,327
 
    
  
Long-term debt, net of current portion
   
 
20,333
 
   
 
23,369
 
Deferred gains and revenues
   
 
8,337
 
   
 
8,737
 
Pension liability
   
 
11,487
 
   
 
11,725
 
    
  
Total liabilities
   
 
75,425
 
   
 
80,158
 
    
  
Stockholders’ Equity:
                  
Capital stock—  
                  
Preferred, authorized 1,000,000 shares, $5 par value; no shares issued
   
 
—  
 
   
 
—  
 
Common, authorized 50,000,000 shares, $0.01 par value; issued and outstanding 29,230,135 and 27,230,135 shares and 29,205,491 and 27,205,491 shares at October 13, 2002 and April 30, 2002, respectively
   
 
292
 
   
 
292
 
Additional paid-in capital
   
 
279,963
 
   
 
279,904
 
Accumulated deficit
   
 
(207,885
)
   
 
(212,566
)
Treasury stock, 2,000,000 shares at October 13, 2002 and 2,000,000 shares at April 30, 2002, at cost
   
 
(4,135
)
   
 
(4,135
)
Accumulated other comprehensive loss
   
 
(8,206
)
   
 
(8,294
)
    
  
Total stockholders’ equity
   
 
60,029
 
   
 
55,201
 
    
  
Total liabilities and stockholders’ equity
   
$
135,454
 
   
$
135,359
 
    
  

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