EX-99.1 2 c76296exv99w1.htm EXHIBIT 99.1 Filed by Bowne Pure Compliance
Exhibit 99.1
P.F. CHANG’S CHINA BISTRO, INC.
P.F. CHANG’S REPORTS THIRD QUARTER EARNINGS
SCOTTSDALE, ARIZONA, October 22, 2008 — P.F. Chang’s China Bistro, Inc. (NASDAQ: PFCB) today reported consolidated net income of $3.0 million for the third quarter ended September 28, 2008 compared to $5.3 million for the third quarter of the prior year. Net income per diluted share for the third quarter of fiscal 2008 was $0.12 and the prior year was $0.20. Current quarter results include the pre-tax impact of $7.5 million in non-cash asset impairment charges recognized in connection with the Company’s closure of 10 Pei Wei restaurants (discussed in further detail below). The asset impairment charges reduced current quarter diluted earnings per share by $0.19.
                 
(000 except per share data)   3Q08     3Q07  
Revenues
   $ 298,359     $ 270,282  
 
                
Income from continuing operations
   $ 2,786     $ 5,603  
Net income
   $ 2,962     $ 5,275  
 
                
Income from continuing operations per diluted share
   $ 0.12     $ 0.21  
Net income per diluted share
   $ 0.12     $ 0.20  
 
                
Weighted average shares — diluted
     23,927       26,105  
For the third quarter of 2008, consolidated revenues were $298.4 million compared to $270.3 million for the third quarter of 2007. Sales at company-owned P.F. Chang’s China Bistro restaurants accounted for $226.4 million of consolidated revenues and sales at the Company’s Pei Wei Asian Diner restaurants accounted for $71.9 million of consolidated revenues.
For the 13 weeks ended September 28, 2008, comparable store sales decreased 3.1% at the Bistro as a significant reduction in overall guest traffic more than offset the benefit of a 4% to 5% average check increase reflecting the net impact of price increases and menu mix changes. Comparable store sales at the Bistro decreased 3.5%, 1.5%, and 4.4% in July, August and September, respectively. Additionally, the impact of Hurricane Ike resulted in $0.4 million of lost revenue during the third quarter of 2008 as a result of temporary store closures at five Bistro locations in the Houston area.
For the 13 weeks ended September 28, 2008, comparable store sales decreased 2.9% at Pei Wei as a significant reduction in overall guest traffic more than offset the benefit of a slightly higher average check reflecting the net impact of price increases and menu mix changes. Comparable store sales at Pei Wei decreased 2.8%, 0.6%, and 5.2% in July, August and September, respectively. Additionally, the impact of Hurricane Ike resulted in $0.5 million of lost revenue during the third quarter of 2008 as a result of temporary store closures at 13 Pei Wei locations in the Houston area.
Net income for both years includes income (loss) from discontinued operations related to the Company’s previously announced planned exit from its Taneko business. On August 1, 2008, the Company completed the sale of Taneko’s long-lived assets.
During the third quarter of 2008, the Company opened six new Pei Wei restaurants. No Bistro restaurants opened during the third quarter of 2008.

 

 

 

Pei Wei Store Closures
As part of ongoing profitability initiatives, the Company will be closing 10 underperforming Pei Wei restaurants during the fourth quarter of 2008. This decision was a result of a rigorous evaluation of the Company’s entire store portfolio. The Company reviewed each location’s past, present and projected operating performance. The locations selected for closure represent restaurants with lower past and present profitability that are not projected to provide acceptable returns in the foreseeable future.
“We have made the tough decision to close 10 Pei Wei restaurants,” said Rick Federico, CEO. “We reached this conclusion as a result of a disciplined financial analysis which highlighted stores that were not performing to the financial standards that we and our investors have come to rely upon. We believe that the underperformance at these locations was primarily a result of poor site selection and the closure of these stores will improve the overall health of Pei Wei and the Company. We continue to believe that Pei Wei is a strong concept and we remain very optimistic about Pei Wei’s future.”
“These decisions are extremely hard to make because of the personal and professional impact they have on all of our people,” Mr. Federico continued. “As a Company, we place high value on the remarkable dedication of our employees and truly appreciate their many contributions each and every day. At the same time, we recognize that it is necessary to take actions that will strengthen our Pei Wei concept and enable us to focus on enhancing operating efficiency and ensuring long-term value for our employees, guests and shareholders.”
During the third quarter of 2008, the Company recognized pre-tax, non-cash asset impairment charges of $7.5 million related to the 10 planned Pei Wei store closures. These asset impairment charges reduced current quarter diluted earnings per share by $0.19. The Company also anticipates additional charges will be recognized during the fourth quarter of 2008 related to lease termination costs and severance payments.
The Company expects Pei Wei restaurant operating income margins to improve by approximately 70-80 basis points in fiscal 2009 as a result of these store closures.
2008 Expectations
The Company has slightly reduced its full year 2008 forecasted earnings per share from continuing operations from a range of $1.36-$1.42 per share to a range of $1.34-$1.40 per share, reflecting expectations of continued economic pressure on consumers for the remainder of the year. This guidance excludes the impact of the asset impairment charges recognized during the third quarter as well as the impact of anticipated restructuring charges to be recognized during the fourth quarter, both of which the Company anticipates reflecting within discontinued operations effective fourth quarter upon restaurant closure.
The Company plans to open a total of 17 new Bistro restaurants and 25 new Pei Wei restaurants during 2008 and now expects full year fiscal 2008 consolidated revenues to increase 11 to 12 percent

 

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2009 Development
The Company has reduced its planned 2009 development and currently expects to open 8 to 10 new Bistro restaurants and 6 to 10 new Pei Wei restaurants during fiscal 2009, primarily reflecting the current macroeconomic environment.
The Company is hosting a conference call today at 1:00 pm ET in which management will provide further details on the third quarter results. A webcast of the call can be accessed through the company’s website at http://www.pfcb.com.
P.F. Chang’s China Bistro, Inc. owns and operates two restaurant concepts in the Asian niche. P.F. Chang’s China Bistro features a blend of high-quality, traditional Chinese cuisine and American hospitality in a sophisticated, contemporary bistro setting. Pei Wei Asian Diner offers a modest menu of freshly prepared Asian cuisine in a relaxed, warm environment offering attentive counter service and take-out flexibility.
Note with respect to non-GAAP financial measures contained within Supplemental Financial Information
In addition to using GAAP results in evaluating the Company’s business, management measures restaurant operating income to assess the performance of its existing restaurant concepts. Restaurant operating income includes all ongoing costs related to operating the Company’s restaurants but excludes preopening expenses and partner investment expense. Because these costs are solely related to expansion of the Company’s business, they make an accurate assessment of the health of its ongoing operations more difficult and are therefore excluded. Additionally, general and administrative expenses are only included in the Company’s consolidated financial presentation as these costs relate to support of both restaurant concepts and are generally not specifically identifiable to individual restaurant operations. As the Company’s expansion is funded entirely from its ongoing restaurant operations, restaurant operating income is a primary consideration of management when determining whether and when to open additional restaurants. The non-GAAP financial information presented herein should be considered in addition to, not as a substitute for, or superior to, financial measures calculated in accordance with GAAP. Please see the non-GAAP to GAAP reconciliation at the bottom of pages 7 through 9 of this press release for a reconciliation of restaurant operating income to the most directly comparable GAAP measure, income from operations.

 

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Note with respect to forward looking statements
The statements contained in this press release that are not purely historical, including the Company’s estimates of its earnings, revenues and anticipated new restaurants are forward-looking statements. The accuracy of these forward-looking statements may be affected by certain risks and uncertainties, including, but not limited to, the Company’s ability to locate acceptable restaurant sites; open new restaurants and operate its restaurants profitably; the Company’s ability to hire, train and retain skilled management and other personnel; the company’s ability to access sufficient financing on acceptable terms; changes in consumer tastes and trends; customer acceptance of new concepts; national, regional and local economic and weather conditions; changes in costs related to food, utilities and labor; and other risks described in the Company’s recent SEC filings.
Contacts:
             
 
  Investor: Mark Mumford   (480) 888-3000   mark.mumford@pfcb.com
 
            
 
  Media: Pete Marino   (312) 339-8833   pmarino@digcommunications.com
 
  Dig Communications        

 

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P.F. Chang’s China Bistro, Inc.
Consolidated Statements of Operations
(In thousands, except per share amounts)
(Unaudited)
                 
    13 Weeks Ended  
    September 28,     September 30,  
    2008     2007  
Revenues
   $ 298,359     $ 270,282  
Costs and expenses:
                
Cost of sales
     81,075       73,865  
Labor
     99,140       91,789  
Operating
     52,767       43,816  
Occupancy
     17,594       15,970  
General & administrative
     18,152       17,186  
Depreciation & amortization
     17,510       14,749  
Preopening expense
     1,519       4,939  
Partner investment expense
     99       (71 )
Asset impairment charge
     7,510       —  
 
            
Total costs and expenses
     295,366       262,243  
 
            
Income from operations
     2,993       8,039  
Interest and other income (expense), net
     (895 )     (10 )
Minority interest
     (367 )     (808 )
 
            
Income from continuing operations before provision for income taxes
     1,731       7,221  
Provision for income taxes
     1,055       (1,618 )
 
            
Income from continuing operations
     2,786       5,603  
Income (loss) from discontinued operations, net of tax
     176       (328 )
 
            
Net income
   $ 2,962     $ 5,275  
 
            
 
                
Basic income per share:
                
Income from continuing operations
   $ 0.12     $ 0.22  
Income (loss) from discontinued operations, net of tax
     0.01       (0.02 )
 
            
Net income
   $ 0.13     $ 0.20  
 
            
 
                
Diluted income per share:
                
Income from continuing operations
   $ 0.12     $ 0.21  
Income (loss) from discontinued operations, net of tax
     0.00       (0.01 )
 
            
Net income
   $ 0.12     $ 0.20  
 
            
 
                
Weighted average shares used in computation — basic
     23,613       25,773  
 
            
Weighted average shares used in computation — diluted
     23,927       26,105  
 
            

 

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P.F. Chang’s China Bistro, Inc.
Consolidated Statements of Operations
(In thousands, except per share amounts)
(Unaudited)
                 
    39 Weeks Ended  
    September 28,     September 30,  
    2008     2007  
Revenues
   $ 911,018     $ 800,789  
Costs and expenses:
                
Cost of sales
     248,248       219,263  
Labor
     304,807       270,959  
Operating
     151,336       127,080  
Occupancy
     53,349       46,384  
General & administrative
     55,801       49,364  
Depreciation & amortization
     51,593       40,827  
Preopening expense
     6,152       10,774  
Partner investment expense
     10       (1,940 )
Asset impairment charge
     7,510       —  
 
            
Total costs and expenses
     878,806       762,711  
 
            
Income from operations
     32,212       38,078  
Interest and other income (expense), net
     (2,778 )     512  
Minority interest
     (1,559 )     (3,576 )
 
            
Income from continuing operations before provision for income taxes
     27,875       35,014  
Provision for income taxes
     (5,794 )     (9,023 )
 
            
Income from continuing operations
     22,081       25,991  
Loss from discontinued operations, net of tax
     (100 )     (974 )
 
            
Net income
   $ 21,981     $ 25,017  
 
            
 
                
Basic income per share:
                
Income from continuing operations
   $ 0.93     $ 1.01  
Loss from discontinued operations, net of tax
     (0.01 )     (0.03 )
 
            
Net income
   $ 0.92     $ 0.98  
 
            
 
                
Diluted income per share:
                
Income from continuing operations
   $ 0.91     $ 1.00  
Loss from discontinued operations, net of tax
     0.00       (0.04 )
 
            
Net income
   $ 0.91     $ 0.96  
 
            
 
                
Weighted average shares used in computation — basic
     23,828       25,656  
 
            
Weighted average shares used in computation — diluted
     24,156       26,093  
 
            

 

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P.F. Chang’s China Bistro, Inc.
Supplemental Financial Information
                                                                                 
    2006     1Q07     2Q07     3Q07     4Q07     2007     1Q08     2Q08     3Q08     YTD Q3 2008  
 
                                                                                
Units
     259       269       283       299       316       316       332       341       347       347  
Sales weeks
     11,848       3,425       3,588       3,776       4,060       14,849       4,252       4,386       4,458       13,096  
AWS
     79,074       76,988       74,365       71,579       71,905       73,589       72,573       69,329       66,927       69,565  
 
                                                                                
Revenues
     936,864       263,684       266,823       270,282       291,933       1,092,722       308,580       304,079       298,359       911,018  
 
                                                                                
Operating costs
                                                                                
Cost of sales
     256,259       72,632       72,766       73,865       80,450       299,713       84,304       82,869       81,075       248,248  
Labor
     309,774       88,863       90,307       91,789       97,100       368,059       104,558       101,109       99,140       304,807  
Operating
     146,247       41,066       42,198       43,816       46,913       173,993       48,662       49,907       52,767       151,336  
Occupancy
     52,408       14,853       15,561       15,970       16,727       63,111       17,919       17,836       17,594       53,349  
Minority interest
     8,116       1,647       1,121       808       593       4,169       705       487       367       1,559  
Depreciation & amortization
     44,793       12,578       13,500       14,749       16,005       56,832       16,652       17,431       17,510       51,593  
Restaurant operating income
     119,267       32,045       31,370       29,285       34,145       126,845       35,780       34,440       29,906       100,126  
 
                                                                                
Development costs
                                                                                
Preopening expenses
     12,286       2,539       3,296       4,939       4,209       14,983       2,824       1,809       1,519       6,152  
Partner investment expense
     4,371       (1,401 )     (468 )     (71 )     (72 )     (2,012 )     411       (500 )     99       10  
 
                                                                                
Other expenses
                                                                                
General and administrative (1)
     56,030       16,494       15,684       17,186       17,604       66,968       18,521       19,128       18,152       55,801  
Interest and other (income) expense, net
     (1,315 )     (343 )     (179 )     10       612       100       934       949       895       2,778  
Asset impairment charge
     —       —       —       —       —       —       —       —       7,510       7,510  
Provision for income taxes
     13,712       3,998       3,407       1,618       2,540       11,563       3,398       3,451       (1,055 )     5,794  
Income from continuing operations
     34,183       10,758       9,630       5,603       9,252       35,243       9,692       9,603       2,786       22,081  
Income (loss) from discontinued operations, net of tax
     (930 )     (293 )     (353 )     (328 )     (2,206 )     (3,180 )     (43 )     (233 )     176       (100 )
Net income
     33,253       10,465       9,277       5,275       7,046       32,063       9,649       9,370       2,962       21,981  
 
                                                                                
Income from continuing operations per FDS
   $ 1.28     $ 0.41     $ 0.37     $ 0.21     $ 0.37     $ 1.36     $ 0.40     $ 0.40     $ 0.12     $ 0.91  
 
                                                                                
Fully diluted shares (FDS)
     26,737       26,046       26,129       26,105       25,257       25,899       24,295       24,247       23,927       24,156  
 
                                                                                
Revenues
     100.0 %     100.0 %     100.0 %     100.0 %     100.0 %     100.0 %     100.0 %     100.0 %     100.0 %     100.0 %
Cost of sales
     27.4 %     27.5 %     27.3 %     27.3 %     27.6 %     27.4 %     27.3 %     27.3 %     27.2 %     27.2 %
Labor
     33.1 %     33.7 %     33.8 %     34.0 %     33.3 %     33.7 %     33.9 %     33.3 %     33.2 %     33.5 %
Operating
     15.6 %     15.6 %     15.8 %     16.2 %     16.1 %     15.9 %     15.8 %     16.4 %     17.7 %     16.6 %
Occupancy
     5.6 %     5.6 %     5.8 %     5.9 %     5.7 %     5.8 %     5.8 %     5.9 %     5.9 %     5.9 %
Minority interest
     0.9 %     0.6 %     0.4 %     0.3 %     0.2 %     0.4 %     0.2 %     0.2 %     0.1 %     0.2 %
Depreciation & amortization
     4.8 %     4.8 %     5.1 %     5.5 %     5.5 %     5.2 %     5.4 %     5.7 %     5.9 %     5.7 %
 
                                                            
Restaurant operating income
     12.7 %     12.2 %     11.8 %     10.8 %     11.7 %     11.6 %     11.6 %     11.3 %     10.0 %     11.0 %
 
                                                            
Preopening expenses
     1.3 %     1.0 %     1.2 %     1.8 %     1.4 %     1.4 %     0.9 %     0.6 %     0.5 %     0.7 %
Partner investment expense
     0.5 %     (0.5 %)     (0.2 %)     (0.0 %)     (0.0 %)     (0.2 %)     0.1 %     (0.2 %)     0.0 %     0.0 %
General and administrative (1)
     6.0 %     6.3 %     5.9 %     6.4 %     6.0 %     6.1 %     6.0 %     6.3 %     6.1 %     6.1 %
Interest and other (income) 
expense, net
     (0.1 %)     (0.1 %)     (0.1 %)     0.0 %     0.2 %     0.0 %     0.3 %     0.3 %     0.3 %     0.3 %
Asset impairment charge
     0.0 %     0.0 %     0.0 %     0.0 %     0.0 %     0.0 %     0.0 %     0.0 %     2.5 %     0.8 %
Provision for income taxes
     1.5 %     1.5 %     1.3 %     0.6 %     0.9 %     1.1 %     1.1 %     1.1 %     (0.4 %)     0.6 %
 
                                                            
Income from continuing operations
     3.6 %     4.1 %     3.6 %     2.1 %     3.2 %     3.2 %     3.1 %     3.2 %     0.9 %     2.4 %
 
                                                            
Income (loss) from discontinued operations, net of tax
     (0.1 %)     (0.1 %)     (0.1 %)     (0.1 %)     (0.8 %)     (0.3 %)     (0.0 %)     (0.1 %)     0.1 %     (0.0 %)
 
                                                            
Net income
     3.5 %     4.0 %     3.5 %     2.0 %     2.4 %     2.9 %     3.1 %     3.1 %     1.0 %     2.4 %
 
                                                            
 
                                                                                
Reconciliation of Non-GAAP Financial Information to GAAP measures:
                                                                                
Restaurant operating income
     119,267       32,045       31,370       29,285       34,145       126,845       35,780       34,440       29,906       100,126  
Add: Minority interest
     8,116       1,647       1,121       808       593       4,169       705       487       367       1,559  
Less: General and administrative (1)
     (56,030 )     (16,494 )     (15,684 )     (17,186 )     (17,604 )     (66,968 )     (18,521 )     (19,128 )     (18,152 )     (55,801 )
Less: Preopening expenses
     (12,286 )     (2,539 )     (3,296 )     (4,939 )     (4,209 )     (14,983 )     (2,824 )     (1,809 )     (1,519 )     (6,152 )
Less: Partner investment expense
     (4,371 )     1,401       468       71       72       2,012       (411 )     500       (99 )     (10 )
Less: Asset Impairment Charge
     —       —       —       —       —       —       —       —       (7,510 )     (7,510 )
 
                                                            
Income from operations
     54,696       16,060       13,979       8,039       12,997       51,075       14,729       14,490       2,993       32,212  
 
                                                            
     
Note:  
Consolidated results include the impact of Shared Services and Other as well as the Bistro and Pei Wei concepts.
 
(1)  
Consolidated general and administrative expenses includes the costs of supporting the Company, including all concepts.

 

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Concept: P.F. Chang’s China Bistro
Supplemental Financial Information
                                                                                 
    2006     1Q07     2Q07     3Q07     4Q07     2007     1Q08     2Q08     3Q08     YTD Q3 2008  
 
                                                                                
Units
     152       153       157       162       172       172       177       182       182       182  
Sales weeks
     7,187       1,979       2,028       2,078       2,204       8,289       2,275       2,330       2,355       6,960  
AWS
     105,265       104,592       102,615       100,325       102,514       102,486       103,763       99,502       96,139       99,756  
Revenues
     756,634       207,028       208,174       208,544       225,997       849,743       236,089       231,972       226,443       694,504  
 
                                                                                
Operating costs
                                                                                
Cost of sales
     206,567       56,781       56,696       56,943       62,158       232,578       64,410       62,999       61,430       188,839  
Labor
     247,097       69,312       69,827       69,946       73,834       282,919       79,318       76,153       74,387       229,858  
Operating
     115,465       31,684       32,194       32,981       35,004       131,863       36,324       36,603       38,556       111,483  
Occupancy
     40,683       11,217       11,598       11,739       12,505       47,059       12,981       12,730       12,536       38,247  
Minority interest
     6,993       1,333       837       599       582       3,351       497       370       271       1,138  
Depreciation & amortization
     34,451       9,483       10,054       10,861       11,896       42,294       12,265       12,794       12,771       37,830  
Restaurant operating income
     105,378       27,218       26,968       25,475       30,018       109,679       30,294       30,323       26,492       87,109  
 
                                                                                
Revenues
     100.0 %     100.0 %     100.0 %     100.0 %     100.0 %     100.0 %     100.0 %     100.0 %     100.0 %     100.0 %
Cost of sales
     27.3 %     27.4 %     27.2 %     27.3 %     27.5 %     27.4 %     27.3 %     27.2 %     27.1 %     27.2 %
Labor
     32.7 %     33.5 %     33.5 %     33.5 %     32.7 %     33.3 %     33.6 %     32.8 %     32.9 %     33.1 %
Operating
     15.3 %     15.3 %     15.5 %     15.8 %     15.5 %     15.5 %     15.4 %     15.8 %     17.0 %     16.1 %
Occupancy
     5.4 %     5.4 %     5.6 %     5.6 %     5.5 %     5.5 %     5.5 %     5.5 %     5.5 %     5.5 %
Minority interest
     0.9 %     0.6 %     0.4 %     0.3 %     0.3 %     0.4 %     0.2 %     0.2 %     0.1 %     0.2 %
Depreciation & amortization
     4.6 %     4.6 %     4.8 %     5.2 %     5.3 %     5.0 %     5.2 %     5.5 %     5.6 %     5.4 %
 
                                                            
Restaurant operating income
     13.9 %     13.1 %     13.0 %     12.2 %     13.3 %     12.9 %     12.8 %     13.1 %     11.7 %     12.5 %
 
                                                            
 
                                                                                
Reconciliation of Non-GAAP Financial Information to GAAP measures:
                                                                                
Restaurant operating income
     105,378       27,218       26,968       25,475       30,018       109,679       30,294       30,323       26,492       87,109  
Add: Minority interest
     6,993       1,333       837       599       582       3,351       497       370       271       1,138  
Less: Preopening expenses
     (8,004 )     (1,256 )     (1,790 )     (2,974 )     (2,992 )     (9,012 )     (1,729 )     (1,271 )     (732 )     (3,732 )
Less: Partner investment expense
     (3,475 )     1,926       753       433       246       3,358       245       500       103       848  
Less: Asset impairment charge
     —       —       —       —       —       —       —       —       —       —  
 
                                                            
Income from operations
     100,892       29,221       26,768       23,533       27,854       107,376       29,307       29,922       26,134       85,363  
 
                                                            
     
Note:  
General and administrative expenses are reflected in the Company’s consolidated results.

 

Page 8 of 11

 

Concept: Pei Wei Asian Diner
Supplemental Financial Information
                                                                                 
    2006     1Q07     2Q07     3Q07     4Q07     2007     1Q08     2Q08     3Q08     YTD Q3 2008  
 
                                                                                
Units
     107       116       126       137       144       144       155       159       165       165  
Sales weeks
     4,661       1,446       1,560       1,698       1,856       6,560       1,977       2,056       2,103       6,136  
AWS
     38,668       39,177       37,592       36,359       35,523       37,037       36,667       35,071       34,197       35,286  
Revenues
     180,230       56,656       58,649       61,738       65,936       242,979       72,491       72,107       71,916       216,514  
 
                                                                                
Operating costs
                                                                                
Cost of sales
     49,692       15,851       16,070       16,922       18,292       67,135       19,894       19,870       19,645       59,409  
Labor
     62,677       19,551       20,480       21,843       23,266       85,140       25,240       24,956       24,753       74,949  
Operating
     30,782       9,382       10,004       10,835       11,909       42,130       12,338       13,304       14,211       39,853  
Occupancy
     11,725       3,636       3,963       4,231       4,222       16,052       4,938       5,106       5,058       15,102  
Minority interest
     1,123       314       284       209       11       818       208       117       96       421  
Depreciation & amortization
     9,205       2,823       3,164       3,417       3,718       13,122       4,056       4,276       4,394       12,726  
Restaurant operating income
     15,026       5,099       4,684       4,281       4,518       18,582       5,817       4,478       3,759       14,054  
 
                                                                                
Revenues
     100.0 %     100.0 %     100.0 %     100.0 %     100.0 %     100.0 %     100.0 %     100.0 %     100.0 %     100.0 %
Cost of sales
     27.6 %     28.0 %     27.4 %     27.4 %     27.7 %     27.6 %     27.4 %     27.6 %     27.3 %     27.4 %
Labor
     34.8 %     34.5 %     34.9 %     35.4 %     35.3 %     35.0 %     34.8 %     34.6 %     34.4 %     34.6 %
Operating
     17.1 %     16.6 %     17.1 %     17.5 %     18.1 %     17.3 %     17.0 %     18.5 %     19.8 %     18.4 %
Occupancy
     6.5 %     6.4 %     6.8 %     6.9 %     6.4 %     6.6 %     6.8 %     7.1 %     7.0 %     7.0 %
Minority interest
     0.6 %     0.6 %     0.5 %     0.3 %     0.0 %     0.3 %     0.3 %     0.2 %     0.1 %     0.2 %
Depreciation & amortization
     5.1 %     5.0 %     5.4 %     5.5 %     5.6 %     5.4 %     5.6 %     5.9 %     6.1 %     5.9 %
 
                                                            
Restaurant operating income
     8.3 %     9.0 %     8.0 %     6.9 %     6.9 %     7.6 %     8.0 %     6.2 %     5.2 %     6.5 %
 
                                                            
 
                                                                                
Reconciliation of Non-GAAP Financial Information to GAAP measures:
                                                                                
Restaurant operating income
     15,026       5,099       4,684       4,281       4,518       18,582       5,817       4,478       3,759       14,054  
Add: Minority interest
     1,123       314       284       209       11       818       208       117       96       421  
Less: Preopening expenses
     (4,283 )     (1,283 )     (1,506 )     (1,965 )     (1,217 )     (5,971 )     (1,095 )     (538 )     (787 )     (2,420 )
Less: Partner investment expense
     (896 )     (525 )     (285 )     (362 )     (174 )     (1,346 )     (656 )     —       (202 )     (858 )
Less: Asset impairment charge
     —       —       —       —       —       —       —       —       (7,510 )     (7,510 )
 
                                                            
Income from operations
     10,970       3,605       3,177       2,163       3,138       12,083       4,274       4,057       (4,644 )     3,687  
 
                                                            
     
Note:  
General and administrative expenses are reflected in the Company’s consolidated results.

 

Page 9 of 11

 

P.F. Chang’s China Bistro
Supplemental Sales Information (Company Owned)
Year of Unit Opening (1)
                                                                                 
    Pre-2001     2001     2002     2003     2004     2005     2006     2007     2008     Total  
 
Units
     51       13       14       18       18       18       20       20       10       182  
Sales (000)
                                                                                 
1Q08
     77,380       19,067       18,306       25,155       20,281       21,118       23,785       26,976       3,992       236,060  
2Q08
     74,274       18,060       17,363       24,390       19,911       20,332       23,076       25,122       9,312       231,840  
3Q08
     71,081       17,282       16,651       23,528       20,016       19,341       22,201       24,190       12,116       226,406  
 
                                                                                
2008
     222,735       54,409       52,320       73,073       60,208       60,791       69,062       76,288       25,420       694,306  
Average Weekly Sales (AWS)
                                                                                 
1Q08
     116,712       112,823       100,580       107,502       86,670       90,248       91,482       103,752       102,364       103,763  
2Q08
     112,028       106,861       95,399       104,231       85,088       86,890       88,754       96,623       99,059       99,502  
3Q08
     109,020       102,261       91,487       100,548       85,539       82,654       85,390       93,040       93,196       96,139  
 
                                                                                
2008
     112,606       107,315       95,822       104,094       85,766       86,597       88,542       97,805       96,651       99,756  
Year-Over-Year Change in AWS (2)
                                                                                 
1Q08
     -0.4 %     1.4 %     0.6 %     0.8 %     0.6 %     0.2 %     -7.9 %     3.5 %     —       -0.8 %
2Q08
     -3.0 %     -0.5 %     0.0 %     -0.5 %     -2.8 %     -2.1 %     -4.9 %     -13.9 %     —       -2.7 %
3Q08
     -3.9 %     -1.8 %     0.0 %     -2.7 %     -2.1 %     -5.8 %     -4.5 %     -12.5 %     —       -3.8 %
 
                                                                                
2008
     -2.4 %     -0.3 %     0.2 %     -0.8 %     -1.4 %     -2.5 %     -5.8 %     -12.7 %     —       -2.4 %
Year-Over-Year Change Comp Store Sales (3)
                                                                                 
Units
     50       13       14       18       18       18       20       3       —       154  
 
                                                                                
1Q08
     -0.4 %     1.4 %     0.6 %     0.8 %     0.6 %     0.2 %     -2.0 %     —       —       0.1 %
2Q08
     -3.0 %     -0.5 %     0.0 %     -0.5 %     -2.8 %     -2.1 %     -4.7 %     —       —       -2.3 %
3Q08
     -3.4 %     -1.8 %     0.0 %     -2.7 %     -2.1 %     -5.8 %     -4.5 %     -3.4 %     —       -3.1 %
 
                                                                                
2008
     -2.2 %     -0.3 %     0.2 %     -0.8 %     -1.4 %     -2.5 %     -4.1 %     -3.4 %     —       -1.8 %
     
(1)  
Includes all restaurants opened in the period indicated.
 
(2)  
A unit is included in the year-over-year change in AWS in the thirteenth month of operation.
 
(3)  
A unit becomes comparable in the eighteenth month of operation.

 

Page 10 of 11

 

Pei Wei Asian Diner
Supplemental Sales Information
Year of Unit Opening (1)
                                                                                 
    2000     2001     2002     2003     2004     2005     2006     2007     2008     Total  
 
Units
     1       4       11       17       20       24       30       37       21       165  
Sales (000)
                                                                                 
1Q08
     730       2,086       5,725       8,942       10,617       11,441       13,494       15,167       4,289       72,491  
2Q08
     697       1,988       5,393       8,570       10,296       11,049       13,121       14,515       6,478       72,107  
3Q08
     679       1,900       5,272       8,387       10,012       10,834       12,899       14,249       7,684       71,916  
 
                                                                                
2008
     2,106       5,974       16,390       25,899       30,925       33,324       39,514       43,931       18,451       216,514  
Average Weekly Sales (AWS)
                                                                                 
1Q08
     56,165       40,115       40,034       40,460       40,833       36,669       34,599       31,531       40,863       36,667  
2Q08
     53,587       38,234       37,713       38,776       39,601       35,412       33,645       30,178       35,204       35,071  
3Q08
     52,256       36,548       36,867       37,949       38,507       34,723       33,074       29,624       33,265       34,197  
 
                                                                                
2008
     54,003       38,299       38,205       39,062       39,647       35,601       33,773       30,444       35,485       35,286  
Year-Over-Year Change in AWS (2)
                                                                                 
1Q08
     -6.7 %     -8.4 %     -7.6 %     -4.7 %     -0.7 %     -0.5 %     -2.1 %     -18.7 %     —       -3.5 %
2Q08
     -5.5 %     -5.1 %     -8.1 %     -7.0 %     -1.7 %     -0.9 %     -1.6 %     -14.8 %     —       -4.5 %
3Q08
     -0.9 %     -2.3 %     -4.9 %     -3.9 %     -3.6 %     -2.5 %     -1.7 %     -10.5 %     —       -4.2 %
 
                                                                                
2008
     -4.5 %     -5.4 %     -6.9 %     -5.2 %     -2.0 %     -1.3 %     -1.8 %     -12.8 %     —       -4.1 %
Year-Over-Year Change Comp Store Sales (3)
                                                                                 
Units
     1       4       11       17       20       24       30       11       —       118  
 
                                                                                
1Q08
     -6.7 %     -8.4 %     -7.6 %     -4.7 %     -0.7 %     -0.5 %     1.4 %     —       —       -2.4 %
2Q08
     -5.5 %     -5.1 %     -8.1 %     -7.0 %     -1.7 %     -0.9 %     -1.3 %     -0.9 %     —       -3.2 %
3Q08
     -0.9 %     -2.3 %     -4.9 %     -3.9 %     -3.6 %     -2.5 %     -1.7 %     -1.0 %     —       -2.9 %
 
                                                                                
2008
     -4.5 %     -5.4 %     -6.9 %     -5.2 %     -2.0 %     -1.3 %     -0.8 %     -1.0 %     —       -2.8 %
     
(1)  
Includes all restaurants opened in the period indicated.
 
(2)  
A unit is included in the year-over-year change in AWS in the thirteenth month of operation.
 
(3)  
A unit becomes comparable in the eighteenth month of operation.

 

Page 11 of 11