-----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, GGr9IgAcki/4NNDjlKPrunDGhPbuzN53JCy2XQy2QjzsueTp4ez4W7XSF3+DlMhv fnNB1ctZFrv1hkSdeiRuJQ== 0000914427-96-000045.txt : 19960709 0000914427-96-000045.hdr.sgml : 19960709 ACCESSION NUMBER: 0000914427-96-000045 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19960420 FILED AS OF DATE: 19960531 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: BERTUCCIS INC CENTRAL INDEX KEY: 0000874971 STANDARD INDUSTRIAL CLASSIFICATION: 5812 IRS NUMBER: 042947209 STATE OF INCORPORATION: MA FISCAL YEAR END: 1228 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-19315 FILM NUMBER: 96575641 BUSINESS ADDRESS: STREET 1: 14 AUDUBON ROAD CITY: WAKEFIELD STATE: MA ZIP: 01880 BUSINESS PHONE: 6172466700 MAIL ADDRESS: STREET 1: 14 AUDUBON ROAD CITY: WAKEFIELD STATE: MA ZIP: 01880 FORMER COMPANY: FORMER CONFORMED NAME: BERTUCCIS HOLDING CORP DATE OF NAME CHANGE: 19600201 10-Q 1 BERTUCCI'S, INC. 10-Q FORM 10-Q SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 For the Quarterly Period Ended April 20, 1996 Commission File Number 0-19315 Bertucci's, Inc. (Exact name of registrant as specified in its charter) Massachusetts 04-2947209 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification Number) 14 Audubon Road, Wakefield, Massachusetts, 01880 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (617) 246-6700 Indicate by check mark whether the registrant (1) has filed all reports required to be filled by section 13 or 15(d) of the Securities Exchange Act of the 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to the filing requirements for the past 90 days. Yes [X] No [ ] On May 31, 1996, 8,739,552 shares of the registrant's Common Stock were outstanding. BERTUCCI'S, INC. FORM 10-Q TABLE OF CONTENTS
PAGE PART I: FINANCIAL INFORMATION Item 1. Financial Statements: 1) Consolidated Condensed Balance Sheets April 20, 1996, and December 30, 1995 4 2) Consolidated Condensed Statements of Operations For Sixteen Weeks Ended April 20, 1996, and April 22, 1995 5 3) Consolidated Condensed Statements of Shareholders' Equity For Sixteen Weeks Ended April 20, 1996 6 4) Consolidated Condensed Statements of Cash Flows - Sixteen Weeks Ended April 20, 1996, and April 22, 1995 7 5) Notes to Consolidated Condensed Financial Statements 8 Item 2. Management's Discussion and Analysis of Results of Operations and Financial Condition 9-11 PART II: OTHER INFORMATION 12
2 PART I:FINANCIAL INFORMATION 3 BERTUCCI'S, INC. CONSOLIDATED CONDENSED BALANCE SHEETS (Unaudited)
April 20, December 30, 1996 1995 (in thousands) ASSETS CURRENT ASSETS: Cash and cash equivalents $ 601 $ 1,384 Inventories 935 951 Accounts receivable 131 154 Note receivable 70 70 Prepaid expenses 467 366 Deferred preopening costs 838 818 Prepaid taxes 758 758 ----------------- ----------------- Total current assets 3,800 4,501 ----------------- ----------------- PROPERTY AND EQUIPMENT, at cost: Land 2,902 2,902 Buildings 10,344 10,324 Leasehold improvements 69,336 69,028 Machinery and equipment 33,784 32,274 Construction in progress 1,525 1,216 Equipment under capital lease 164 164 ----------------- ----------------- 118,055 115,908 Less - Accumulated depreciation 26,289 26,048 ----------------- ----------------- Net property and equipment 91,766 89,860 ----------------- ----------------- PREPAID TAXES 2,405 2,405 OTHER ASSETS 2,096 2,172 ----------------- ----------------- $ 100,067 $ 98,938 ================= ================= LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES: Notes payable-current $ 25 $ 25 Accounts payable 4,219 4,243 Accrued expenses 798 513 Accrued restaurant closing expense 1,313 1,539 Accrued payroll and employee benefits 2,466 2,419 Accrued taxes 1,391 1,019 ----------------- ----------------- Total current liabilities 10,212 9,758 DEFERRED RENT 5,667 5,575 NOTES PAYABLE 50 75 LONG-TERM DEBT 19,438 19,438 SHAREHOLDERS' EQUITY: Preferred stock, $.01 par value - Authorized - 200,000 shares, none issued - - Common stock, $.005 par value - Authorized - 15,000,000 shares Issued and outstanding - 8,728,442 shares at December 30, 1995 and 8,739,552 shares at April 20, 1996 44 44 Additional paid-in capital 44,679 44,620 Retained earnings 19,977 19,428 ----------------- ----------------- Total shareholders' equity 64,700 64,092 ----------------- ----------------- $ 100,067 $ 98,938 ================= =================
The accompanying notes are an integral part of these consolidated condensed financial statements. 4 BERTUCCI'S, INC. CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS (Unaudited)
Sixteen Weeks Ended April 20, 1996 April 22, 1995 (in thousands, except per share data) NET SALES $ 38,259 $ 35,446 ------------------ ------------------ COSTS AND EXPENSES: Cost of sales 9,798 9,051 Operating expenses 19,881 17,326 General and administrative expenses 2,477 2,641 Depreciation and amortization 2,712 2,762 Taxes other than income 2,101 1,932 ------------------ ------------------ Total costs and expenses 36,969 33,712 ------------------ ------------------ Operating income 1,290 1,734 INTEREST EXPENSE, net 418 323 INTEREST INCOME 6 8 ------------------ ------------------ Income before income tax expense 878 1,419 INCOME TAX EXPENSE 329 517 ------------------ ------------------ Net income $ 549 $ 902 ================== ================== WEIGHTED AVERAGE SHARES OUTSTANDING 8,892,502 8,890,120 ================== ================== EARNINGS PER SHARE $ 0.06 $ 0.10 ================== ==================
The accompanying notes are an integral part of these consolidated condensed financial statements. 5 BERTUCCI'S, INC. CONSOLIDATED CONDENSED STATEMENTS OF SHAREHOLDERS' EQUITY (Unaudited)
Additional Common Stock Paid-In Retained Shareholders' Shares Par Capital Earnings Equity (in thousands) BALANCE, December 30, 1995 8,728 $ 44 $ 44,620 $ 19,428 $ 64,092 Issuance of stock 12 - 59 - 59 Net income - - - 549 549 ---------- ------------ ------------- ------------- -------------- BALANCE, April 20, 1996 8,740 $ 44 $ 44,679 $ 19,977 $ 64,700 ========== ============ ============= ============= ==============
The accompanying notes are an integral part of these consolidated condensed financial statements. 6 BERTUCCI'S, INC. CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (Unaudited)
Sixteen Weeks Ended April 20, 1996 April 22, 1995 (in thousands) --------------- -------------- CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 549 $ 902 Adjustments to reconcile net income to net cash provided by operating activities Depreciation and amortization 2,712 2,762 (Increase) decrease in inventories 16 (118) Increase in prepaid expenses, accounts receivable, notes receivable and other assets (1) (92) Decrease in accounts payable (24) (2,045) Increase in accrued expenses and deferred rent 197 522 Increase (decrease) in accrued, deferred and prepaid taxes 372 (561) --------------- -------------- Net cash provided by operations 3,821 1,370 --------------- -------------- CASH FLOWS USED FROM INVESTING ACTIVITIES: Additions to preopening costs (446) (435) Additions to property and equipment (4,192) (6,622) --------------- -------------- Net cash used by investing activities (4,638) (7,057) --------------- -------------- CASH FLOWS FROM FINANCING ACTIVITIES: Issuance of common stock 59 65 Proceeds from debt - 4,938 Decrease in notes payable (25) (25) ---------------- -------------- Net cash provided by financing activities 34 4,978 ---------------- -------------- NET DECREASE IN CASH AND CASH EQUIVALENTS (783) (709) CASH AND CASH EQUIVALENTS, beginning of period 1,384 750 ---------------- -------------- CASH AND CASH EQUIVALENTS, end of period $ 601 $ 41 ================ ============== SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION: Cash paid during the period for --- Interest, net of amount capitalized $ 410 $ 268 ================ ============== Income taxes $ 37 $ 408 ================ ==============
The accompanying notes are an integral part of these consolidated condensed financial statements. 7 BERTUCCI'S, INC. NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS April 20, 1996 1. Basis of Presentation In the opinion of management, the accompanying consolidated condensed financial statements contain all normal recurring adjustments necessary for a fair presentation. The results of operations for the sixteen-week period ended April 20, 1996 are not necessarily indicative of the results to be expected for the full year. The significant accounting policies followed by the Company are set forth in the notes to Consolidated Financial Statements in the Company's 1995 Annual Report and Form 10-K filed with the Securities and Exchange Commission. These financial statements should be read in conjunction with the financial statements included in the 1995 Annual Report and Form 10-K. Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations The following table sets forth the percentage relationship to net sales of certain items included in the company's income statements for the periods indicated.
Sixteen Weeks Ended ---------------------------------------------- April 20, April 22, 1996 1995 ---------------- --------------- NET SALES 100.0% 100.0% ---------------- --------------- COSTS AND EXPENSES: Costs of sales 25.6 25.5 Operating expenses 51.9 48.9 General and administrative expenses 6.5 7.5 Depreciation and amortization 7.1 7.8 Taxes other than income 5.5 5.4 ---------------- --------------- Total costs and expenses 96.6 95.1 ---------------- --------------- Operating income 3.4 4.9 INTEREST EXPENSE, net 1.1 0.9 INTEREST INCOME - - ---------------- --------------- Income before income tax expense 2.3 4.0 INCOME TAX EXPENSE 0.9 1.5 ---------------- --------------- Net income 1.4% 2.5% ================ =============== NUMBER OF RESTAURANTS: Restaurants open at beginning of period 76 67 Restaurants opened during period 3 3 Restaurants closed during period (3) - ---------------- --------------- Restaurants open at end of period 76 70
9 Sixteen Weeks Ended April 20, 1996 Compared to Sixteen Weeks Ended April 22, 1995 Net sales increased $2.8 million, or 7.9%, to $38.3 million in the first quarter of fiscal year 1996, from $35.4 million in the first quarter of fiscal year 1995. The increase in net sales came from the nine new restaurants opened in fiscal year 1995, and three new restaurants opened in the first quarter of 1996. Comparable restaurant sales during the first quarter were flat, but the Company estimates that over 3.0% of total sales were lost due to severe winter weather. Cost of sales, primarily food and beverages, increased from $9.1 million in the sixteen weeks ended April 22, 1995, to $9.8 million in the corresponding 1996 period. As a percentage of net sales, these costs were 25.5% in the 1995 fiscal period, and 25.6% in the 1996 fiscal period. Although the price of olive oil, tomatoes, flour, and cheese increased, the Company was able to offset most of the increase by more efficient operations. Restaurant operating expenses for the sixteen-week period increased from $17.3 million in fiscal year 1995, to $19.9 million in fiscal year 1996. As a percentage of net sales, operating expenses increased from 48.9% during the sixteen weeks ended April 22, 1995, to 51.9% during the corresponding period in 1996. The increase was the result of advertising costs of 3.5%, as a percentage of net sales, that were not present during the first quarter of 1995. General and administrative expenses decreased from $2.6 million in the sixteen weeks ended April 22, 1995, to $2.5 million in the corresponding 1996 period, and decreased, as a percentage of net sales, from 7.5% in the 1995 sixteen-week period, to 6.5% in the 1996 sixteen-week period. This decrease was the result of attrition at the corporate level, and a reduction in training costs due to fewer store openings expected this year. Depreciation and amortization expense decreased, as a percentage of net sales, from 7.8% in the 1995 period, to 7.1% in the 1996 sixteen-week period. This decrease was attributable to the amortization expense on fewer new restaurants. Taxes other than income increased from $1.9 million during the sixteen weeks ended April 22, 1995, to $2.1 million in the corresponding 1996 period, due to increases in real property taxes on rented property. Interest expense increased from $323,000 to $418,000 for the sixteen weeks of 1995 and 1996, respectively. This increase was attributable to the higher amount of bank borrowings in the 1996 sixteen-week period. The effective income tax rate increased from 36.4% for the sixteen weeks ended April 22, 1995, to 37.5% for the corresponding period ending April 20, 1996. 10 Liquidity and Sources of Capital To date, the Company has financed its expansion from operations, bank borrowing, and private placements and public offerings of equity securities. The Company does not have significant receivables or inventory and receives trade credit based upon negotiated terms in purchasing food and supplies. The Company has a bank line-of-credit in effect until November 30, 1997, under which it may borrow up to $30.0 million. On November 30, 1997, the Company will be able to convert the balance, if any, to a term loan maturing on November 30, 2000. The Company pays a fee of 1/4 of 1% on the unused balance, and interest is calculated using LIBOR plus 1.25%. There are no compensating balance arrangements or legal restrictions as to the withdrawal of these funds. At April 22, 1995, and April 20, 1996, the amounts outstanding under this bank line-of-credit were $18.9 and $19.4 million, respectively. During the sixteen weeks ended April 22, 1995, and April 20, 1996, the Company's investment in property and equipment was $6.6 million and $4.2 million, respectively. The investments were funded with cash provided by operations, and with the proceeds of financing activities. Cash provided by operations amounted to $1.4 million and $3.8 million for the sixteen weeks ended April 22, 1995, and April 20, 1996, respectively. Cash from financing activities amounted to $5.0 million for the sixteen-week period in 1995. The Company opened three new restaurants in the first sixteen weeks of 1996, and expects to open a total of 8 new restaurants by the end of fiscal year 1996, with an additional five restaurants planned for fiscal year 1997. The Company expects to expend approximately $13.0 million in fiscal year 1996, and approximately $10.0 million in fiscal year 1997 to finance expansion. The Company believes that it will have sufficient working capital and bank borrowings to finance its expansion plans through the end of fiscal year 1997. 11 PART II: OTHER INFORMATION Item 1. LEGAL PROCEEDINGS None Item 2. CHANGES IN SECURITIES None Item 3. DEFAULTS UPON SENIOR SECURITIES None Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS None Item 5. OTHER INFORMATION None Item 6. EXHIBITS AND REPORTS ON FORM 8-K (a) Exhibits None (b) Reports on Form 8-K No reports on Form 8-K were filed during the period covered by this report. 12 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 thereunto duly authorized. BERTUCCI'S, INC. ---------------------------------- (Registrant) Date: May 31, 1996 By: /s/ Joseph Crugnale --------------------------------- Joseph Crugnale President and Chief Executive Officer Date: May 31, 1996 By: /s/ Norman S. Mallett --------------------------------- Norman S. Mallett Vice-President - Finance Cheif Financial Officer and Treasurer 13 -----END PRIVACY-ENHANCED MESSAGE-----