INDIANAPOLIS, May 9 /PRNewswire-FirstCall/ -- The Steak n Shake
Company (NYSE:SNS) today announced its revenues and earnings for
the second quarter 2007 ended April 11, 2007. (Logo:
http://www.newscom.com/cgi-bin/prnh/20000606/STEAKLOGO ) Highlights
of the fiscal second quarter include: -- Total revenues increased
2.3% to $202.2 million -- Net earnings were $6.0 million -- Diluted
earnings per share were $0.21 Fiscal Second Quarter 2007 Results
Total revenues for the fiscal second quarter 2007 grew 2.3% to
$202.2 million compared to the same quarter last year. Same-store
sales declined 4.7% with approximately 1.7% of the decline related
to adverse weather in February and March that impacted much of
Steak n Shake's Midwest market. Net earnings for the fiscal second
quarter 2007 were $6.0 million, or $0.21 per diluted share,
compared to $8.5 million, or $0.30 per diluted share, in the prior
year period. Peter Dunn, President and Chief Executive Officer
commented, "While we continue to make progress on key operating
fundamentals, it has not been enough to offset economic challenges.
During the quarter we experienced the impact of adverse weather in
our core markets as well as consumer reaction to rising gas prices
and higher interest rates. In addition, our Southeastern markets
have been further impacted by regional economic factors. "While
fiscal 2007 continues to be a very challenging year, we are
determined to shape our future by enhancing the design and
execution of the Steak n Shake business model based on recently
completed research called the 'Guest Winning Promise' and related
projects. This research provides powerful insights on how to
optimize critical dimensions of the business including the design
of our service model, food offerings as well as building interior
and exterior design. We believe these insights have the potential
to drive same store sales and enhance the economics of Steak n
Shake over time." As of April 11, 2007, there were 490 Steak n
Shake restaurants operating in 20 states, including 439
Company-owned restaurants and 51 franchised units. During the
quarter, the Company opened 6 new restaurants in four states and
one franchise unit. Fiscal 2007 Guidance Given the difficult
economic environment outlined above, the Company is revising the
full year diluted earnings per share guidance for fiscal year 2007
to a range of $0.53 to $0.67. This includes a non-cash charge of
$0.14 to $0.17 of fully diluted earnings per share related to the
anticipated closure of 10 to 15 underperforming units during the
remainder of fiscal 2007, and $0.04 to $0.05 of diluted earnings
per share of non operating expenses related to evolution of the
organization and completion of major IT projects. These expenses
will be incurred in the back half of the 2007 fiscal year. This
compares to the previous range of $0.90 to $1.00. The revised
guidance is based on expected same store sales of down 2% to 4%,
which is being revised from the previous same store sales guidance
range of positive 1% to down 3%. The Company also reaffirmed the
opening of approximately 15 Company-owned restaurants and at least
7 franchise units during fiscal 2007. New Board of Directors Member
The Company is also pleased to announce that Geoffrey Ballotti
recently joined its Board of Directors. Mr. Ballotti is a graduate
of Colby College and Harvard Business School. He is a senior
executive with Starwood Hotels & Resorts Worldwide and
currently serves as the President of its North American division.
Mr. Ballotti will serve on the Company's Audit,
Nominating/Corporate Governance and Personnel/Benefits Committees.
Investor Conference Call and Webcast The Steak n Shake Company will
broadcast its investor conference call live over the Internet at
5:00 p.m. Eastern Time, 4:00 p.m. Central Time today. Hosting the
call will be Peter Dunn, President and Chief Executive Officer, and
Jeffrey A. Blade, Senior Vice President and Chief Financial
Officer. Interested investors and other parties may listen to a
simultaneous webcast of the conference call by logging onto the
Company's website at http://www.steaknshake.com/. The on-line
replay will be available for a limited time immediately following
the call. The call can also be accessed live over the phone by
dialing (866) 409-1564, or for international callers, (913)
312-1234. A replay will be available one hour after the call and
can be accessed by dialing (888) 203-1112, or for international
callers, (719) 457-0820. The passcode for the replay is 6374264.
The replay will be available until May 16, 2007. About Steak n
Shake Steak n Shake is a full service, casual dining restaurant
serving a core menu of its famous STEAKBURGER(TM) sandwiches, thin
'n crispy french fries, old fashioned hand-dipped milk shakes,
chili, home style soups, fresh salads, a variety of desserts and
breakfast. All of the food is prepared to the guest's order and
served by friendly, well-trained associates. Steak n Shake
restaurants feature full-service dining areas, counter service and
drive-thru windows and are open 24 hours a day, seven days a week.
This press release contains forward-looking information. In
general, forward-looking statements include estimates of future
revenues, cash flows, capital expenditures, or other financial
items, and assumptions underlying any of the foregoing.
Forward-looking statements reflect management's current
expectations regarding future events and use words such as
"anticipate", "believe", "expect", "may", "will", and other similar
terminology. These statements speak only as of the date they were
made and involve a number of risks and uncertainties that could
cause actual results to differ materially from those expressed in
forward-looking statements. Several factors, many beyond our
control, could cause actual results to differ significantly from
our expectations, such as the following: effectiveness of operating
initiatives; changes in economic conditions; effectiveness of
advertising and marketing initiatives; harsh weather conditions,
primarily in the first and second quarters; availability and cost
of qualified restaurant personnel; changes in consumer tastes;
changes in consumer behavior based on publicity or concerns
relating to food safety or food-borne illnesses; effectiveness of
our expansion plans; changes in minimum wage rates; changes in food
commodity prices; completion of merger or acquisitions and
successful integration of those transactions; and changes in
applicable accounting policies and practices. The foregoing list of
important factors is not intended to be all- inclusive as other
general market, industry, economic, and political factors may also
impact our operations. Readers are cautioned not to place undue
reliance on our forward-looking statements, as we assume no
obligation to update forward-looking statements. THE STEAK N SHAKE
COMPANY CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS SIXTEEN WEEKS
ENDED 4/11/2007 4/12/2006 (Amounts in $000's, (UNAUDITED)
(UNAUDITED) except share and per share data) Revenues Net sales
$201,055 99.5% $196,520 99.4% Franchise fees 1,096 0.5% 1,137 0.6%
202,151 100.0% 197,657 100.0% Costs and Expenses Cost of sales(1)
46,188 23.0% 44,601 22.7% Restaurant operating costs(1) 101,783
50.6% 98,283 50.0% General and administrative 17,551 8.7% 16,303
8.2% Depreciation and amortization 9,825 4.9% 8,715 4.4% Marketing
9,148 4.5% 9,154 4.6% Interest 4,242 2.1% 3,106 1.6% Rent 4,255
2.1% 3,873 2.0% Pre-opening costs 812 0.4% 977 0.5% Provision for
store closings (127) -0.1% (103) -0.1% Other income, net (539)
-0.3% (438) -0.2% 193,138 95.5% 184,471 93.3% Earnings Before
Income Taxes 9,013 4.5% 13,186 6.7% Income Taxes 3,021 1.5% 4,655
2.4% Net Earnings $5,992 3.0% $8,531 4.3% Net Earnings Per Common
and Common Equivalent Share: Basic $0.21 $0.31 Diluted $0.21 $0.30
Weighted Average Shares and Equivalents: Basic 28,025,019
27,730,596 Diluted 28,230,461 28,077,224 (1) Cost of sales and
restaurant operating costs are expressed as a percentage of net
sales. THE STEAK N SHAKE COMPANY CONDENSED CONSOLIDATED STATEMENTS
OF EARNINGS TWENTY-EIGHT WEEKS ENDED 4/11/2007 4/12/2006 (Amounts
in $000's, (UNAUDITED) (UNAUDITED) except share and per share data)
Revenues Net sales $347,513 99.5% $334,372 99.4% Franchise fees
1,904 0.5% 2,026 0.6% 349,417 100.0% 336,398 100.0% Costs and
Expenses Cost of sales(1) 79,258 22.8% 76,121 22.8% Restaurant
operating costs(1) 177,251 51.0% 168,074 50.3% General and
administrative 31,106 8.9% 28,775 8.6% Depreciation and
amortization 17,051 4.9% 15,112 4.5% Marketing 15,574 4.5% 15,006
4.5% Interest 7,375 2.1% 5,893 1.8% Rent 7,303 2.1% 6,407 1.9%
Pre-opening costs 1,746 0.5% 2,156 0.6% Provision for store
closings (193) -0.1% (103) 0.0% Other income, net (944) -0.3%
(1,094) -0.3% 335,527 96.0% 316,347 94.0% Earnings Before Income
Taxes 13,890 4.0% 20,051 6.0% Income Taxes 3,733 1.1% 6,861 2.0%
Net Earnings $10,157 2.9% $13,190 3.9% Net Earnings Per Common and
Common Equivalent Share: Basic $0.36 $0.48 Diluted $0.36 $0.47
Weighted Average Shares and Equivalents: Basic 27,974,493
27,689,806 Diluted 28,191,845 28,019,211 (1) Cost of sales and
restaurant operating costs are expressed as a percentage of net
sales. CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
4/11/2007 9/27/2006 (Amounts in $000's) (UNAUDITED) (UNAUDITED)
Assets Current assets $29,775 $30,920 Property and equipment - net
508,312 490,142 Other assets 24,542 21,459 Total assets $562,629
$542,521 Liabilities and Shareholders' Equity Current liabilities
$91,781 $83,083 Deferred income taxes and credits 9,707 9,605
Obligations under capital leases 142,220 143,996 Senior note 17,761
18,802 Shareholders' equity 301,160 287,035 Total liabilities and
shareholders' equity $562,629 $542,521 CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS Twenty-Eight Weeks Ended 4/11/2007
4/12/2006 (UNAUDITED) (UNAUDITED) (Amounts in $000's) Net cash
provided by operating activities 19,710 39,547 Net cash used in
investing activities (35,774) (46,143) Net cash provided by (used
in) financing activities 13,555 8,008 Increase (Decrease) in Cash
and Cash Equivalents (2,509) 1,412
http://www.newscom.com/cgi-bin/prnh/20000606/STEAKLOGO
http://photoarchive.ap.org/ DATASOURCE: The Steak n Shake Company
CONTACT: Jeffrey A. Blade of The Steak n Shake Company,
+1-317-633-4100, Web site: http://www.steaknshake.com/
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