-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Ey7R+wxU8Z5fdHZzKJ3E5Kut3WXT+Pf0HKaApvr4HEud3vhoU4AXulPJgzMkTKqT 95aJtZ2y06leXDTVdkwmbg== 0000813920-05-000067.txt : 20050726 0000813920-05-000067.hdr.sgml : 20050726 20050726160730 ACCESSION NUMBER: 0000813920-05-000067 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20050703 ITEM INFORMATION: Results of Operations and Financial Condition FILED AS OF DATE: 20050726 DATE AS OF CHANGE: 20050726 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CEC ENTERTAINMENT INC CENTRAL INDEX KEY: 0000813920 STANDARD INDUSTRIAL CLASSIFICATION: RETAIL-EATING PLACES [5812] IRS NUMBER: 480905805 STATE OF INCORPORATION: KS FISCAL YEAR END: 1230 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-13687 FILM NUMBER: 05974327 BUSINESS ADDRESS: STREET 1: PO BOX 152077 CITY: IRVING STATE: TX ZIP: 75015 BUSINESS PHONE: 9722585403 MAIL ADDRESS: STREET 1: PO BOX 152077 CITY: IRVING STATE: TX ZIP: 75015 FORMER COMPANY: FORMER CONFORMED NAME: SHOWBIZ PIZZA TIME INC DATE OF NAME CHANGE: 19920703 8-K 1 k82nd2005earnings.txt 2005 1ST QTR EARNINGS UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ----------------------------- FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report: (Date of earliest event reported) July 26, 2005 ---------------------------- CEC ENTERTAINMENT, INC. (Exact name of registrant as specified in charter) Kansas 0-15782 48-0905805 (State or other jurisdiction of (Commission File Number) (IRS Employer incorporation or organization) Identification No.) 4441 West Airport Freeway Irving, Texas 75062 (Address of principal executive offices and zip code) (972) 258-8507 (Registrant's telephone number, including area code) N/A (Former name or former address, if changed since last report) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the Registrant under any of the following provisions (see General Instruction A.2. below): |_| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425). |_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12). |_| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)). |_| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)). Item 7: Financial Statements and Exhibits. (c) Exhibits 99 Press Release of CEC Entertainment, Inc. dated July 26, 2005. Item 12: Results of Operations and Financial Condition The information furnished in this Current Report on Form 8-K and the Exhibit attached hereto shall not be deemed "filed" for the purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of such section. On July 26, 2005, CEC Entertainment, Inc. issued a press release announcing financial results for the fiscal second quarter ended July 3, 2005. A copy of the press release is attached as Exhibit 99.1 to this Current Report on Form 8-K. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. CEC ENTERTAINMENT, INC. Date: July 26, 2005 By: /s/ Christopher D. Morris ---------------------------------------------- Christopher D. Morris Senior Vice President, Chief Financial Officer EXHIBIT INDEX Exhibit Number Description - ------- ----------- 99 Press Release of CEC Entertainment, Inc. dated July 26, 2005. EX-99 2 ex992nd2005.txt PRESS RELEASE FOR RELEASE CONTACT: Chris Morris July 26, 2005 Senior Vice President 3:05 p.m. Central Time Chief Financial Officer (972) 258-4525 CEC ENTERTAINMENT, INC. REPORTS SECOND QUARTER RESULTS; BOARD APPROVES $400 MILLION STOCK BUYBACK IRVING, TEXAS - CEC Entertainment, Inc. (NYSE:"CEC") today announced earnings for the second quarter ended July 3, 2005. Revenues for the second quarter of 2005 increased to $168.4 million from $165.4 million in the second quarter of 2004. Net income was $14.4 million in both the second quarter of 2005 and the second quarter of 2004. Diluted earnings per share in the second quarter of 2005 were $0.40 per share compared to $0.37 per share in the second quarter of 2004. Revenues for the first six months of 2005 increased to $382.5 million from $372.4 million in the first six months of 2004. Net income was $46.7 million in the first six months of 2005 and $45.8 million in the same period of 2004. Diluted earnings per share in the first six months of 2005 were $1.26 per share compared to $1.17 per share in the first six months of 2004. Chris Morris, Senior Vice President and Chief Financial Officer stated that, "Total revenues in the second quarter increased $3.0 million over the prior year due to new store development. Comparable store sales in the second quarter decreased 2.1%. We believe the decline in comparable store sales was primarily due to unsuccessful promotions in the quarter and the effect of higher gasoline prices on the spending decisions of our customers. Earnings per diluted share increased 8.1% over the prior year. During the first two quarters of 2005, the Company generated operating cash flow of $75 million, invested $34 million primarily in new and existing stores and repurchased $64 million of Company stock. Borrowings on our credit facility increased by $11 million. In July, the Company secured a $200 million revolving credit facility with a term of five years that replaces its previous $132.5 million credit facility that was scheduled to mature in December 2005." Mr. Morris further added, "Based on current estimates, we expect diluted earnings per share to range from $2.24 to $2.31 per share for the 2005 fiscal year and $0.56 to $0.61 and $0.42 to $0.44 in the third and fourth quarters of 2005, respectively. Our estimates include the assumption that comparable store sales are slightly negative to flat during the last half of the year." The Company also announced that its Board of Directors has approved a new plan to purchase, from time to time in the open market or through negotiated trades with persons who are not affiliates of the Company, shares of the Company's common stock at an aggregate purchase price of up to $400 million. The Company recently completed the purchase of $100 million of its common stock pursuant to a stock buyback plan approved in August 2004. The Company's decision to commence a new plan to purchase up to an additional $400 million of its common stock was based on its belief that its common stock represents an attractive long-term investment opportunity for the Company. The timing and extent of the purchases will depend on market conditions. The funds required for the stock purchase will be provided from the Company's cash balances, operating cash flow and as appropriate, the Company's credit facility. Richard M. Frank, Chairman and Chief Executive Officer stated that, "We believe the continued execution of our long-term strategies of reinvesting in our core stores, continued new store development, building on operational execution and strategically repurchasing Company stock will drive long-term shareholder value. The $400 million stock buyback plan approved by our Board is significantly higher than previously approved stock buyback plans. The Board's decision to approve the stock buyback plan reflects their confidence in the long-term prospects of the Company and their belief in the opportunity to provide a long-term benefit to shareholders by share repurchases." Certain statements in this press release, other than historical information, may be considered forward-looking statements, within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995, and are subject to various risks, uncertainties and assumptions. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may differ from those anticipated, estimated or expected. Among the key factors that may have a direct bearing on CEC's operating results, performance or financial condition are its ability to implement its growth strategies, national, regional and local economic conditions affecting the restaurant/entertainment industry, competition within each of the restaurant and entertainment industries, success of its franchise operations, negative publicity, fluctuations in quarterly results of operations, including seasonality, government regulations, weather, school holidays, commodity and labor costs. CEC Entertainment, Inc. operates a system of 500 Chuck E. Cheese's restaurants in 48 states, of which 455 are owned and operated by the Company. # # #
CEC ENTERTAINMENT, INC. CONDENSED CONSOLIDATED RESULTS OF OPERATIONS (Thousands, except per share date) Quarter Ended Year to Date Ended 07/03/05 06/27/04 07/03/05 06/27/04 -------- -------- -------- -------- Revenues: Food and beverage $ 109,455 $ 108,739 $ 248,499 $ 245,078 Games and merchandise 58,253 55,826 132,495 125,567 Franchise fees and royalties 685 852 1,480 1,713 Interest income 8 7 13 14 --------- --------- --------- --------- 168,401 165,424 382,487 372,372 --------- --------- --------- --------- Costs and expenses: Cost of sales: Food, beverage and related supplies 19,837 21,307 45,405 45,785 Games and merchandise 6,707 7,218 15,031 15,860 Labor 48,622 47,688 102,447 100,927 Selling, general and administrative expenses 21,416 20,047 46,833 43,879 Depreciation and amortization 15,780 13,880 30,177 27,258 Interest expense 984 485 1,707 968 Other operating expenses 31,659 31,436 65,214 63,387 --------- --------- --------- --------- 145,005 142,061 306,814 298,064 --------- --------- --------- --------- Income before income taxes 23,396 23,363 75,673 74,308 Income taxes 8,960 8,947 28,983 28,459 --------- --------- --------- --------- Net income $ 14,436 $ 14,416 $ 46,690 $ 45,849 ========= ========= ========= ========= Earnings per share: Basic $ .41 $ .38 $ 1.31 $ 1.21 Diluted $ .40 $ .37 $ 1.26 $ 1.17 Weighted average shares outstanding: Basic 35,255 37,507 35,736 37,910 Diluted 36,473 38,604 36,963 39,107
CEC ENTERTAINMENT, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (Thousands, except share amounts) July 3, January 2, 2005 2005 ----------- ----------- (unaudited) ASSETS Current assets: Cash and cash equivalents....................................... $ 9,611 $ 11,798 Accounts receivable............................................. 15,141 13,482 Inventories..................................................... 11,919 12,171 Prepaid expenses................................................ 9,144 7,444 Deferred tax asset.............................................. 1,763 1,763 --------- --------- Total current assets......................................... 47,578 46,658 --------- --------- Property and equipment, net........................................ 567,231 563,081 --------- --------- Other assets ...................................................... 1,122 2,278 --------- --------- $ 615,931 $ 612,017 ========= ========= LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Current portion of long-term debt............................... $ 534 $ 78,279 Accounts payable................................................ 22,927 24,294 Accrued liabilities............................................. 32,957 36,329 --------- --------- Total current liabilities.................................... 56,418 138,902 --------- --------- Long-term debt, less current portion............................... 100,669 11,673 --------- --------- Deferred rent...................................................... 58,545 53,427 --------- --------- Deferred tax liability............................................. 34,386 36,429 --------- --------- Accrued insurance ................................................. 10,750 10,856 --------- --------- Shareholders' equity: Common stock, $.10 par value; authorized 100,000,000 shares; 55,973,127 and 55,556,857 shares issued, respectively ....... 5,597 5,556 Capital in excess of par value.................................. 257,823 245,991 Retained earnings .............................................. 479,957 433,267 Accumulated other comprehensive income ......................... 1,333 1,476 Less treasury shares of 20,921,268 and 19,210,568, respectively, at cost........................ (389,547) (325,560) --------- --------- 355,163 360,730 --------- --------- $ 615,931 $ 612,017 ========= =========
CEC ENTERTAINMENT, INC. SUPPLEMENTAL FINANCIAL INFORMATION (Thousands) Quarter Ended Year to Date Ended 07/03/05 06/27/04 07/03/05 06/27/04 -------- -------- -------- -------- Number of Company-owned stores: Beginning of period 453 420 449 418 New 1 10 5 12 Company purchased franchise stores 1 1 Closed ---- ---- ---- ---- End of period 455 430 455 430 Number of franchise stores: Beginning of period 45 48 46 48 New 1 1 1 1 Company purchased franchise stores (1) (1) Closed (1) ---- ---- ---- ---- End of period 45 49 45 49
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