x
|
QUARTERLY
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF
1934
|
o
|
TRANSITION
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF
1934
|
Delaware
|
13-3319172
|
(State
or other jurisdiction
of
incorporation or
organization)
|
(IRS
Employer
Identification
No.)
|
|
Page
Number
|
|||
PART
I - FINANCIAL INFORMATION
|
||||
Item
1. Financial Statements
|
||||
Condensed
Consolidated Balance Sheets -
|
||||
September
24, 2006 (unaudited) and December 25, 2005
|
3
|
|||
|
||||
Condensed
Consolidated Statements of Operations -
|
||||
For
the three months and nine months ended September
|
||||
24,
2006 and September 25, 2005 (both unaudited)
|
5
|
|||
Condensed
Consolidated Statements of Cash Flows -
|
||||
For
the nine months ended September 24, 2006 and
|
||||
September
25, 2005 (both unaudited)
|
6
|
|||
Notes
to Condensed Consolidated Financial Statements
|
8
|
|||
Item
2. Management's Discussion and Analysis of Financial
Condition
|
||||
and
Results of Operations
|
22
|
|||
Item
3. Quantitative and Qualitative Disclosures About Market
Risk
|
38
|
|||
Item
4. Evaluation of Disclosure Controls and Procedures
|
38
|
|||
PART
II - OTHER INFORMATION
|
||||
Item
1. Legal Proceedings
|
39
|
|||
Item
1A. Risk Factors
|
39
|
|||
Item
6. Exhibits
|
39
|
|||
|
||||
SIGNATURES
|
40
|
September
24, 2006
|
December
25, 2005
|
||||||
(Unaudited)
|
|
||||||
Current
assets:
|
|||||||
Cash
|
$
|
2,180
|
$
|
3,161
|
|||
Inventories
|
819
|
727
|
|||||
Receivables,
net of reserve ($300 in
|
|||||||
2006
and $238 in 2005)
|
747
|
784
|
|||||
Note
receivable - current portion
|
12
|
11
|
|||||
Reimbursable
costs receivable
|
853
|
912
|
|||||
Prepaid
expenses and other current assets
|
855
|
401
|
|||||
Total
current assets
|
5,466
|
5,996
|
|||||
Furniture,
equipment, and improvements, net
|
15,454
|
13,372
|
|||||
Restricted
cash
|
1,192
|
1,042
|
|||||
Note
receivable
|
66
|
79
|
|||||
Liquor
licenses
|
411
|
426
|
|||||
Deferred
tax asset
|
3,945
|
577
|
|||||
Non-compete
agreement, net
|
2,945
|
-
|
|||||
Other
assets
|
589
|
276
|
|||||
Goodwill,
net
|
205
|
205
|
|||||
Total
assets
|
$
|
30,273
|
$
|
21,973
|
September
24, 2006
|
December
25, 2005
|
||||||
(unaudited)
|
|||||||
Current
liabilities:
|
|||||||
Accounts
payable
|
$
|
1,582
|
$
|
1,457
|
|||
Accrued
expenses
|
5,322
|
4,533
|
|||||
Accrued
managed outlets operating expenses
|
853
|
912
|
|||||
Payable
to Hotel Restaurant Properties, Inc.
|
3,020
|
—
|
|||||
Current
portion of long-term debt
|
84
|
48
|
|||||
Current
portion of notes payable - related parties
|
155
|
312
|
|||||
Current
portion of liability for debt extinguishment
|
50
|
—
|
|||||
Total
current liabilities
|
11,066
|
7,262
|
|||||
Long-term
debt
|
1,612
|
206
|
|||||
Notes
payable - related parties
|
—
|
671
|
|||||
Liability
for debt extinguishment
|
100
|
—
|
|||||
Other
long-term liabilities
|
8,831
|
7,398
|
|||||
Total
liabilities
|
21,609
|
15,537
|
|||||
Minority
interest
|
1,509
|
1,630
|
|||||
Stockholders'
equity:
|
|||||||
Preferred
Stock, 1,000,000 shares authorized,
|
|||||||
995,935
shares undesignated in 2006 and 2005
|
—
|
—
|
|||||
Series
II, 10% Convertible Preferred Stock, $.001 par
|
|||||||
value;
500 shares authorized, 500 shares
|
|||||||
issued
and outstanding in 2006 and 2005
|
—
|
—
|
|||||
Common
stock, $.00004 par value; 12,000,000 shares
|
|||||||
authorized
in 2006 and 2005, 6,403,212 shares
|
|||||||
issued
and outstanding in 2006, 5,728,495 shares
|
|||||||
issued
and outstanding in 2005
|
—
|
—
|
|||||
Additional
paid-in capital
|
14,488
|
13,686
|
|||||
Accumulated
deficit
|
(7,333
|
)
|
(8,880
|
)
|
|||
Total
stockholders' equity
|
7,155
|
4,806
|
|||||
Total
liabilities, minority interest and
|
|||||||
stockholders'
equity
|
$
|
30,273
|
$
|
21,973
|
Three
Months Ended
|
Nine
Months Ended
|
||||||||||||
September
24, 2006
|
September
25, 2005
|
September
24, 2006
|
September
25, 2005
|
||||||||||
|
|||||||||||||
Revenues:
|
|||||||||||||
Sales
|
$
|
14,792
|
$
|
13,298
|
$
|
44,366
|
$
|
40,102
|
|||||
Cost
reimbursements
|
3,921
|
3,675
|
11,535
|
10,264
|
|||||||||
Management
and license fees
|
491
|
402
|
1,329
|
1,127
|
|||||||||
Total
revenues
|
19,204
|
17,375
|
57,230
|
51,493
|
|||||||||
Operating
expenses:
|
|||||||||||||
Cost
of sales
|
4,298
|
3,743
|
12,576
|
11,295
|
|||||||||
Restaurant
operating
|
9,039
|
8,256
|
26,544
|
23,987
|
|||||||||
Reimbursed
costs
|
3,921
|
3,675
|
11,535
|
10,264
|
|||||||||
General
and administrative
|
1,443
|
1,147
|
4,305
|
3,417
|
|||||||||
Depreciation
and amortization
|
749
|
660
|
1,810
|
1,603
|
|||||||||
Pre-opening
costs
|
242
|
11
|
440
|
272
|
|||||||||
Total
operating expenses
|
19,692
|
17,492
|
57,210
|
50,838
|
|||||||||
Income
(loss) from operations
|
(488
|
)
|
(117
|
)
|
20
|
655
|
|||||||
Interest,
net
|
(90
|
)
|
(43
|
)
|
(197
|
)
|
(123
|
)
|
|||||
Debt
extinguishment costs
|
—
|
—
|
(279
|
)
|
—
|
||||||||
Income
(loss) before benefit (provision) for
|
|||||||||||||
income
taxes and minority interest
|
(578
|
)
|
(160
|
)
|
(456
|
)
|
532
|
||||||
Benefit
(provision) for income taxes
|
163
|
(68
|
)
|
2,138
|
(277
|
)
|
|||||||
Minority
interest in net (profit)
|
|||||||||||||
loss
of subsidiaries
|
(30
|
)
|
40
|
(135
|
)
|
364
|
|||||||
Net
income (loss)
|
(445
|
)
|
(188
|
)
|
1,547
|
619
|
|||||||
Preferred
dividends accrued
|
(13
|
)
|
(13
|
)
|
(38
|
)
|
(38
|
)
|
|||||
Net
income (loss) applicable to
|
|||||||||||||
common
stock
|
$
|
(458
|
)
|
$
|
(201
|
)
|
$
|
1,509
|
$
|
581
|
|||
Net
income (loss) per share applicable
|
|||||||||||||
to
common stock:
|
|||||||||||||
Basic
net income (loss)
|
$
|
(0.07
|
)
|
$
|
(0.04
|
)
|
$
|
0.25
|
$
|
0.10
|
|||
Diluted
net income (loss)
|
$
|
(0.07
|
)
|
$
|
(0.04
|
)
|
$
|
0.24
|
$
|
0.09
|
|||
Weighted
average shares outstanding:
|
|||||||||||||
Basic
|
6,350,827
|
5,652,230
|
5,980,299
|
5,679,752
|
|||||||||
Diluted
|
6,350,827
|
5,652,230
|
6,474,678
|
6,217,285
|
Nine
Months Ended
|
|||||||
September
24, 2006
|
September
25, 2005
|
||||||
Cash
flows from operating activities:
|
|||||||
Net
income
|
$
|
1,547
|
$
|
619
|
|||
Adjustments
to reconcile net income to net cash
|
|||||||
provided
by operating activities:
|
|||||||
Depreciation
and amortization
|
1,810
|
1,603
|
|||||
Amortized
deferred rent and lease incentives
|
(609
|
)
|
(484
|
)
|
|||
Amortized
debt issuance costs
|
57
|
—
|
|||||
Deferred
tax asset
|
(3,368
|
)
|
—
|
||||
Stock
based compensation
|
153
|
—
|
|||||
Provision
for doubtful accounts
|
62
|
60
|
|||||
Loss
on debt extinguishment
|
219
|
—
|
|||||
Gain
on sale of assets
|
(19
|
)
|
(5
|
)
|
|||
Minority
interest in net profit (loss) of subsidiaries
|
135
|
(364
|
)
|
||||
Changes
in operating assets and liabilities:
|
|||||||
Inventories
|
(92
|
)
|
(22
|
)
|
|||
Receivables
|
(25
|
)
|
5
|
||||
Prepaid
expenses and other current assets
|
(244
|
)
|
103
|
||||
Tenant
improvement allowances
|
1,832
|
1,962
|
|||||
Non-compete
agreement and other assets
|
(43
|
)
|
(65
|
)
|
|||
Accounts
payable
|
125
|
(804
|
)
|
||||
Accrued
expenses
|
686
|
619
|
|||||
Net
cash provided by operating activities
|
2,226
|
3,227
|
|||||
Cash
flows from investing activities:
|
|||||||
Proceeds
from disposal of assets
|
55
|
5
|
|||||
Collections
on note receivable
|
15
|
15
|
|||||
Restricted
cash
|
(150
|
)
|
(160
|
)
|
|||
Purchase
of liquor license
|
(16
|
)
|
(71
|
)
|
|||
Purchase
of furniture, equipment and improvements
|
(3,480
|
)
|
(3,716
|
)
|
|||
Net
cash used in investing activities
|
(3,576
|
)
|
(3,927
|
)
|
Cash
flows from financing activities:
|
|||||||
Capital
contributions from minority interests in LLC’s
|
$
|
125
|
$
|
1,274
|
|||
Debt
issuance costs
|
(413
|
)
|
—
|
||||
Return
of capital and profits to minority shareholder
|
(282
|
)
|
(186
|
)
|
|||
Proceeds
from line of credit and equipment financing
|
1,233
|
118
|
|||||
Proceeds
from exercise of stock options and warrants
|
649
|
33
|
|||||
Payments
on notes payable - to member of Chicago Grill
|
(902
|
)
|
(104
|
)
|
|||
Payments
on long-term debt
|
(41
|
)
|
(183
|
)
|
|||
Net
cash provided by financing activities
|
369
|
952
|
|||||
Net
increase (decrease) in cash
|
(981
|
)
|
252
|
||||
Cash,
beginning of period
|
3,161
|
1,407
|
|||||
Cash,
end of period
|
$
|
2,180
|
$
|
1,659
|
|||
Supplemental
cash flow information:
|
|||||||
Cash
paid during the period for:
|
|||||||
Interest
|
$
|
232
|
$
|
141
|
|||
Income
taxes
|
709
|
263
|
|||||
Non-cash
investing and financing items:
|
|||||||
Non-compete
agreement
|
$
|
3,020
|
—
|
||||
Capital
lease equipment financing
|
250
|
—
|
1. |
INTERIM
FINANCIAL PRESENTATION
|
2. |
PREPAID
EXPENSES AND OTHER CURRENT
ASSETS
|
(in
thousands)
|
2006
|
2005
|
|||||
Lease
incentives receivable
|
$
|
210
|
$
|
—
|
|||
Prepaid
expenses, other
|
645
|
401
|
|||||
Total
prepaid expenses and other current assets
|
$
|
855
|
$
|
401
|
3. |
RESTRICTED
CASH
|
4. |
INCOME
TAXES
|
5. |
LONG-TERM
DEBT
|
6. |
LIABILITY
FOR DEBT EXTINGUISHMENT
|
7. |
OTHER
LONG-TERM LIABILITIES
|
(in
thousands)
|
2006
|
2005
|
|||||
Lease
Incentives
|
$
|
6,726
|
$
|
5,140
|
|||
Deferred
Rent
|
2,105
|
2,258
|
|||||
Total
Other Long-Term Liabilities
|
$
|
8,831
|
$
|
7,398
|
8. |
PER
SHARE DATA
|
Three
months
|
2006
|
2005
|
|||||||||||
(in
thousands, except share data)
|
Earnings
|
Shares
|
Earnings
|
Shares
|
|||||||||
Net
loss
|
$
|
(445
|
)
|
$
|
(188
|
)
|
|||||||
Less:
preferred stock dividends
|
(13
|
)
|
(13
|
)
|
|||||||||
Earnings
available for common stockholders
|
(458
|
)
|
6,350,827
|
(201
|
)
|
5,652,230
|
|||||||
Dilutive
earnings available to common stockholders
|
$
|
(458
|
)
|
6,350,827
|
$
|
(201
|
)
|
5,652,230
|
Nine
months
|
2006
|
2005
|
|||||||||||
(in
thousands, except share data)
|
Earnings
|
Shares
|
Earnings
|
Shares
|
|||||||||
Net
income
|
$
|
1,547
|
$
|
619
|
|||||||||
Less:
preferred stock dividends
|
(38
|
)
|
(38
|
)
|
|||||||||
Earnings
available for common stockholders
|
1,509
|
5,980,299
|
581
|
5,679,752
|
|||||||||
Dilutive
securities:
|
|||||||||||||
Stock
options
|
—
|
96,487
|
—
|
126,111
|
|||||||||
Warrants
|
—
|
272,892
|
—
|
411,422
|
|||||||||
Convertible
Preferred Stocks
|
—
|
125,000
|
—
|
—
|
|||||||||
Dilutive
earnings available to common stockholders
|
$
|
1,509
|
6,474,678
|
$
|
581
|
6,217,285
|
9. |
ISSUANCES
OF COMMON STOCK
|
10. |
STOCK-BASED
COMPENSATION
|
Three
Months Ended
|
|
Nine
Months Ended
|
|
||||
(in
thousands, except per share amounts)
|
|
September
25, 2005
|
|
September
25, 2005
|
|||
Net
income (loss), as reported
|
$
|
(201
|
)
|
$
|
581
|
||
Deduct:
stock compensation expense under fair value method, net of
taxes
|
(125
|
)
|
(201
|
)
|
|||
Net
income (loss), pro forma
|
$
|
(326
|
)
|
$
|
380
|
||
Net
income (loss) per share, as reported:
|
|||||||
Basic
|
$
|
(0.04
|
)
|
$
|
0.10
|
||
Diluted
|
$
|
(0.04
|
)
|
$
|
0.09
|
||
Net
income (loss) per share, pro forma:
|
|||||||
Basic
|
$
|
(0.06
|
)
|
$
|
0.07
|
||
Diluted
|
$
|
(0.06
|
)
|
$
|
0.06
|
For
the nine months ended
|
|||||||
September
24, 2006
|
September
25, 2005
|
||||||
Expected
volatility
|
68.40
|
%
|
66.71
|
%
|
|||
Risk
free interest rate
|
5.15
|
%
|
4.05
|
%
|
|||
Expected
option life
|
6.3
years
|
8.67
years
|
|||||
Dividend
yield
|
0
|
%
|
0
|
%
|
|||
Fair
value cost of options granted
|
$
|
2.13
|
$
|
3.09
|
Shares
|
Weighted
Average Exercise
Price
|
Weighted
Average Remaining Contractual Life
(in years)
|
Aggregate
Intrinsic
Value
|
||||||||||
Outstanding
at December 25, 2005
|
713,275
|
$
|
2.89
|
||||||||||
Granted
|
183,750
|
3.17
|
|||||||||||
Exercised
|
(32,400
|
)
|
2.18
|
||||||||||
Cancelled
|
(25,200
|
)
|
3.10
|
||||||||||
Outstanding
at September 24, 2006
|
839,425
|
$
|
2.98
|
6.2
|
462,663
|
||||||||
Exercisable
at September 24, 2006
|
485,075
|
2.86
|
4.6
|
347,037
|
Options
Outstanding .
|
Options
Exercisable .
|
|||||||||||||||
Range
of
Exercise
Price
|
Number
Outstanding
at
September
24,
2006 .
|
Weighted-
Average
Remaining
Contractual
Life
|
Weighted-
Average
Exercise
Price
|
Number
Outstanding
at
September
24,
2006
.
|
Weighted-
Average
Exercise
Price
|
|||||||||||
$
1.25
|
1,750
|
3.7
|
$
|
1.25
|
1,750
|
$
|
1.25
|
|||||||||
$
1.55
|
41,000
|
4.0
|
$
|
1.55
|
41,000
|
$
|
1.55
|
|||||||||
$
1.65
|
86,500
|
4.9
|
$
|
1.65
|
70,800
|
$
|
1.65
|
|||||||||
$
1.70
|
34,750
|
6.7
|
$
|
1.70
|
20,050
|
$
|
1.70
|
|||||||||
$
2.19
|
49,050
|
4.9
|
$
|
2.19
|
49,050
|
$
|
2.19
|
|||||||||
$
2.23
|
50,000
|
7.8
|
$
|
2.23
|
20,000
|
$
|
2.23
|
|||||||||
$
2.46
|
14,000
|
0.9
|
$
|
2.46
|
14,000
|
$
|
2.46
|
|||||||||
$
2.86
|
64,250
|
6.2
|
$
|
2.86
|
37,850
|
$
|
2.86
|
|||||||||
$
3.14
|
25,000
|
2.6
|
$
|
3.14
|
10,000
|
$
|
3.14
|
|||||||||
$
3.16
|
203,750
|
3.6
|
$
|
3.16
|
121,000
|
$
|
3.16
|
|||||||||
$
3.19
|
50,000
|
9.5
|
$
|
3.19
|
—
|
$
|
3.19
|
|||||||||
$
3.20
|
30,000
|
9.8
|
$
|
3.20
|
—
|
$
|
3.20
|
|||||||||
$
3.45
|
25,000
|
9.1
|
$
|
3.45
|
—
|
$
|
3.45
|
|||||||||
$
4.00 to $ 4.68
|
146,750
|
6.2
|
$
|
4.20
|
81,950
|
$
|
4.17
|
|||||||||
$
5.36 to $14.00
|
17,625
|
0.3
|
$
|
6.40
|
17,625
|
$
|
6.40
|
|||||||||
Total | 839,425 | 485,075 |
11. |
RECENT
ACCOUNTING PRONOUNCEMENTS
|
12. |
RELATED
PARTY TRANSACTIONS
|
13. |
DISTRIBUTION
OF CAPITAL AND PREFERRED
RETURNS
|
(in
thousands)
|
San
Jose Grill, LLC
|
Chicago
Grill On The Alley, LLC
|
The
Grill On Hollywood, LLC
|
||||||||||||||||
Members
|
Company
|
Members
|
Company
|
Members
|
Company
|
||||||||||||||
Distributions
of profit and note repayments
during the nine months ended
September 24, 2006:
|
$
|
255
|
$
|
255
|
$
|
972
(a
|
)
|
—
|
—
|
—
|
|||||||||
Unreturned
Initial Capital Contributions at
September 24, 2006:
|
—
|
—
|
—
|
—
|
$
|
1,200
|
$
|
250
|
|||||||||||
Preferred
Return rate:
|
10
|
%
|
10
|
%
|
8
|
%
|
—
|
12
|
%
|
12
|
%
|
||||||||
Accrued
but unpaid Preferred Returns at
September 24, 2006:
|
—
|
—
|
—
|
—
|
(b
|
)
|
(b
|
)
|
South
Bay Daily Grill
(Continental
Park, LLC)
|
Universal
Citywalk Daily Grill
|
Downtown
Daily Grill
(612
Flower Daily Grill, LLC)
|
|||||||||||||||||
Members
|
Company
|
Members
|
Company
|
Members
|
Company
(d)
|
||||||||||||||
Distributions
of profit during the nine months
ended September 24, 2006:
|
—
|
—
|
—
|
—
|
$
|
27
|
$
|
9
|
|||||||||||
Unreturned
Initial and Additional Capital
Contributions at September 24, 2006:
|
$
|
1,100
|
$
|
450
|
$
|
1,496
|
$
|
296
|
$
|
1,373
|
$
|
304
|
|||||||
Preferred
Return rate:
|
10
|
%
|
10%
(c
|
)
|
—
|
—
|
9
|
%
|
9
|
%
|
|||||||||
Accrued
but unpaid Preferred Returns at
September 24, 2006:
|
(b
|
)
|
(b
|
)
|
(b
|
)
|
—
|
$
|
39
|
$
|
7
|
(a) |
Distribution
of capital and note repayments as of September 24, 2006 includes
$902,000
of retirement of collateralized subordinated notes and mandatorily
redeemable capital obligations and $70,000 of interest and preferred
return.
|
(b) |
Due
to the under performance of the restaurants the preferred return
is not
being accrued. The Company is not liable to pay the preferred return
distributions, such that they represent a non-recourse obligation
of the
subsidiary entity. If preferred returns were accrued for The Grill
on
Hollywood the member would have an accrued preferred return of $950,000
and the Company would have an accrued preferred return of $198,000.
If
preferred returns were accrued for the South Bay Daily Grill the
member
would have an accrued preferred return of $466,000 and the Company
would
have an accrued preferred return of $183,000. If
preferred returns were accrued for the CityWalk Partnership the Member
would have an accrued preferred return of $627,000.
|
(c) | The Company’s preferred return with respect to the South Bay Daily Grill is based on unrecovered capital contribution and accrued but unpaid management fees. |
(d) | The Company is a non-managing member, and a wholly owned subsidiary of the Company is the manager of this restaurant. |
14. |
LITIGATION
CONTINGENCIES AND COMMITMENTS
|
Three
Months Ended
|
Nine
Months Ended
|
||||||||||||
September
24,
2006
|
September
25,
2005
|
September
24, 2006
|
September
25,
2005
|
||||||||||
Revenues:
|
%
|
%
|
%
|
%
|
|||||||||
Sales
|
77.0
|
76.5
|
77.5
|
77.9
|
|||||||||
Cost
reimbursements
|
20.4
|
21.2
|
20.2
|
19.9
|
|||||||||
Management
and license fees
|
2.6
|
2.6
|
2.3
|
2.2
|
|||||||||
Total
revenues
|
100.0
|
100.0
|
100.0
|
100.0
|
|||||||||
Operating
expenses:
|
|||||||||||||
Cost
of sales
|
22.4
|
21.5
|
22.0
|
21.9
|
|||||||||
Restaurant
operating
|
47.1
|
47.5
|
46.3
|
46.6
|
|||||||||
Reimbursed
costs
|
20.4
|
21.2
|
20.2
|
19.9
|
|||||||||
General
and administrative
|
7.5
|
6.6
|
7.5
|
6.6
|
|||||||||
Depreciation
and amortization
|
3.9
|
3.8
|
3.2
|
3.1
|
|||||||||
Pre-opening
costs
|
1.2
|
0.1
|
0.8
|
0.5
|
|||||||||
Total
operating expenses
|
102.5
|
100.7
|
100.0
|
98.7
|
|||||||||
Income
(loss) from operations
|
(2.5
|
)
|
(0.7
|
)
|
(0.0
|
)
|
1.3
|
||||||
Interest,
net
|
(0.5
|
)
|
(0.3
|
)
|
(0.3
|
)
|
(0.2
|
)
|
|||||
Debt
extinguishment costs
|
(0.0
|
)
|
—
|
(0.5
|
)
|
—
|
|||||||
Income
(loss) before benefit (provision)
|
|||||||||||||
for
income taxes and minority interest
|
(3.0
|
)
|
(1.0
|
)
|
(0.8
|
)
|
1.1
|
||||||
Benefit
(provision) for income taxes
|
0.8
|
(0.4
|
)
|
3.7
|
(0.5
|
)
|
|||||||
Minority
interest in net (profit) loss of
|
|||||||||||||
subsidiaries
|
(0.1
|
)
|
0.3
|
(0.2
|
)
|
0.7
|
|||||||
Net
income (loss)
|
(2.3
|
)
|
(1.1
|
)
|
2.7
|
1.3
|
Three
Months Ended
|
Nine
Months Ended
|
||||||||||||
|
|
|
September
24, 2006
|
September
25, 2005
|
September
24, 2006
|
September
25, 2005
|
|||||||
|
|
||||||||||||
Revenues:
|
%
|
%
|
%
|
%
|
|||||||||
Sales
|
100.0
|
100.0
|
100.0
|
100.0
|
|||||||||
Cost
of sales
|
29.1
|
28.1
|
28.3
|
28.2
|
|||||||||
Restaurant
operating expenses
|
61.1
|
62.1
|
59.8
|
59.8
|
Third
Quarter
Openings
|
Year-to-date
Openings
|
Total
open at
End
of Quarter
|
|||||||||||||||||
2006
|
2005
|
2006
|
2005
|
2006
|
2005
|
||||||||||||||
Daily
Grill restaurants:
|
|||||||||||||||||||
Company
owned
|
-
|
(1
|
)
|
-
|
1
|
12
|
12
|
||||||||||||
Managed
and/or licensed
|
-
|
-
|
-
|
-
|
8
|
8
|
|||||||||||||
Grill
on the Alley restaurants:
|
|||||||||||||||||||
Company
owned
|
1
|
-
|
-
|
-
|
5
|
4
|
|||||||||||||
Total
|
1
|
(1
|
)
|
-
|
1
|
25
|
24
|
Three
Months Ended
|
Nine
Months Ended
|
||||||||||||
September
24,
2006
|
September
25,
2005
|
September
24,
2006
|
September
25,
2005
|
||||||||||
Weighted
average weekly sales
|
|||||||||||||
per
Company owned restaurant:
|
|||||||||||||
Daily
Grill
|
$
|
59,814
|
$
|
55,344
|
$
|
63,248
|
$
|
58,735
|
|||||
Grill
on the Alley
|
87,167
|
81,969
|
85,867
|
81,207
|
|||||||||
Change
in comparable restaurant sales (1):
|
|||||||||||||
Daily
Grill
|
5.4
|
%
|
1.1
|
%
|
5.3
|
%
|
0.0
|
%
|
|||||
Grill
on the Alley
|
12.1
|
%
|
13.0
|
%
|
11.2
|
%
|
10.7
|
%
|
|||||
Total
sales (in thousands):
|
|||||||||||||
Daily
Grill
|
$
|
9,331
|
$
|
9,036
|
$
|
29,599
|
$
|
27,434
|
|||||
Grill
on the Alley
|
5,461
|
4,262
|
14,767
|
12,668
|
|||||||||
Total
consolidated sales
|
$
|
14,792
|
$
|
13,298
|
$
|
44,366
|
$
|
40,102
|
(1) |
When
computing comparable restaurant sales, restaurants open for at least
12
months are compared from period to
period.
|
Three
Months Ended
|
Nine
Months Ended
|
||||||||||||
(in
thousands)
|
September
24,
2006
|
September
25,
2005
|
September
24,
2006
|
September
25,
2005
|
|||||||||
Managed
Daily Grills
|
$
|
5,444
|
$
|
4,830
|
$
|
15,941
|
$
|
14,039
|
|||||
Licensed
Daily Grills
|
1,801
|
2,173
|
5,486
|
5,943
|
|||||||||
$
|
7,245
|
$
|
7,003
|
$
|
21,427
|
$
|
19,982
|
||||||
Management
and license fees
|
$
|
491
|
$
|
402
|
$
|
1,329
|
$
|
1,127
|
|||||
Percent
of gross sales
|
6.8
|
%
|
5.7
|
%
|
6.2
|
%
|
5.6
|
%
|
(in
thousands)
|
2006
|
2005
|
|||||
Net
cash provided by operating activities
|
$
|
2,226
|
$
|
3,227
|
|||
Net
cash used in investing activities
|
(3,576
|
)
|
(3,927
|
)
|
|||
Net
cash provided by financing activities
|
369
|
952
|
|||||
Net
increase (decrease) in cash
|
$
|
(981
|
)
|
$
|
252
|
Payments
due by period (in thousands)
|
||||||||||||||||
Total
|
2006
|
2007
- 2008
|
2009
- 2010
|
Thereafter
|
||||||||||||
Long-term
debt
|
$
|
1,481
|
$
|
175
|
$
|
18
|
$
|
1,243
|
$
|
45
|
||||||
Capital
lease obligations
|
371
|
29
|
153
|
161
|
28
|
|||||||||||
Operating
lease commitments
|
30,139
|
3,647
|
7,324
|
6,061
|
13,107
|
|||||||||||
Other
contractual obligations
|
3,020
|
138
|
2,882
|
-
|
-
|
|||||||||||
Total
|
$
|
35,011
|
$
|
3,989
|
$
|
10,377
|
$
|
7,465
|
$
|
13,180
|
(in
thousands)
|
San
Jose Grill, LLC
|
Chicago
Grill On The Alley, LLC
|
The
Grill On Hollywood, LLC
|
|||||||||||||||||||