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SECURITIES AND EXCHANGE COMMISSION
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): September 8, 2004
DAVE & BUSTER’S, INC.
| Missouri | 0000943823 | 43-1532756 | ||
| (State of incorporation) |
(Commission File Number) |
(IRS Employer Identification Number) |
2481 Manana Drive
Dallas TX 75220
Registrant’s telephone number, including area code: (214) 357-9588
Check the appropriate box if the Form 8-K filing is intended to simultaneously satisfy the reporting obligation of the registrant under any of the following provisions:
| o | Written communications pursuant to Rule 425 under the Securities Act |
| o | Soliciting material pursuant to Rule 14a-12 of the Exchange Act |
| o | Pre-commencement communications pursuant to Rule 14d-2(b) Exchange Act |
| o | Pre-commencement communications pursuant to Rule 13e-4(c) Exchange Act |
| Item 2.02. Results of Operations and Financial Condition. | ||||||||
| Item 9.01. Financial Statements and Exhibits. | ||||||||
| Press Release | ||||||||
Table of Contents
Item 2.02. Results of Operations and Financial Condition.
On September 8, 2004, the Company issued a press release regarding its results of operations for the second quarter and 26 weeks ended August 1, 2004.
Item 9.01. Financial Statements and Exhibits.
(c) Exhibits. The following are filed as Exhibits to this Report.
99.1
|
Dave & Buster’s, Inc. Press Release dated September 8, 2004. |
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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.
| DAVE & BUSTER’S, INC. |
||||
| Date: September 9, 2004 | By: | /s/ W.C. HAMMETT, JR. | ||
| W.C. Hammett, Jr., | ||||
| Chief Financial Officer | ||||
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Exhibit 99.1
DAVE & BUSTER’S, INC. REPORTS INCREASE IN
BOTH SECOND QUARTER NET INCOME AND SAME STORE REVENUES
DALLAS-September 8, 2004-Dave & Buster’s, Inc. (NYSE: DAB), a leading operator of upscale restaurant/entertainment complexes, announced earnings for its second quarter and 26 weeks ended August 1, 2004.
Total revenue for the second quarter increased 1.7 percent to $89.8 million from $88.3 million in the prior year’s comparable quarter. Food and beverage revenue increased 3.1 percent, and amusement and other revenue increased 0.3 percent. Revenue from comparable stores increased 0.5 percent for the quarter. Special event revenue on a comparable store basis was 13.4 percent of total revenue, compared to 12.2 percent of total revenue in the second quarter last year. Operating income for the quarter was $4.5 million, compared to $4.0 million in the prior year. Net income for the quarter was $2.2 million, or $0.16 per diluted share, compared to $1.5 million, or $0.11 per diluted share for the same period last year. The number of diluted shares outstanding increased 22.5 percent to 16.486 million shares in the current quarter, compared to 13.458 million shares in the second quarter of last year, primarily as a result of the convertible debt issues during last fiscal year. During the second quarter last year, the company incurred certain one-time charges totaling $0.8 million, or $0.04 per diluted share. Without these charges, operating income would have been $4.7 million last year and net income would have been $2.0 million, or $0.15 per diluted share.
Total revenues for the 26-week period increased 2.7 percent to $184.8 million from $179.9 million for the comparable period last year. Food and beverage revenue increased 3.0 percent, and amusement and other revenue increased 2.5 percent. Special event revenue on a comparable store basis was 13.0 percent of total revenue, compared to 12.2 percent of total revenue in the comparable period last year. Operating income was $11.5 million, compared to $10.6 million for the prior year. Net income was $5.8 million, or $0.40 per diluted share, compared to $4.5 million, or $0.34 per diluted share, in the prior year. The number of diluted shares outstanding increased 22.4 percent to 16.376 million, for the 26 weeks compared to 13.383 million during the same period last year.
“We continue to improve the overall profitability of the company,” remarked Buster Corley, the company’s CEO. “We now have six consecutive quarters of improved year-over-year earnings through a difficult economy. We are pleased with our progress and have confidence in the D&B team’s ability to perform.”
“We obviously are very pleased with the second quarter results,” stated Dave Corriveau, President of the company. “The construction of our new store in Arcadia, CA is on target to open on September 29, 2004. We are optimistic that this store will be a very good performer for us.”
“We remain confident in our earnings guidance of $0.89 to $0.92 per diluted share and revenue guidance of $379 million to $382 million for the fiscal year which ends on January 30, 2005,” commented W. C. Hammett, the company’s CFO. “This does not include the previously disclosed potential acquisition of certain assets of Jillian’s
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Entertainment Holdings, Inc. If we ultimately are the successful bidder for these assets, we will adjust our guidance accordingly.”
The company will hold a conference call on Wednesday, September 8 at 11:30 a. m. EDT (10:30 a.m. CDT) to discuss the results. The call will be Webcast by both CCBN and Vcall and can be accessed via Dave & Buster’s Web site, www.daveandbusters.com. Individual investors can listen to the call through CCBN’s individual investor center, www.companyboardroom.com, or PrecisionIR’s Webcast site, www.vcall.com. In addition, investors can access the call by visiting any of the investor sites in the CCBN or PrecisionIR Individual Investor Network. Institutional investors can access the call via CCBN’s password-protected event management site, www.streetevents.com. The Webcast will be archived on the company’s Web site and available for replay through September 22, 2004.
Celebrating over 21 years of operations, Dave & Buster’s was founded in 1982 and is one of the country’s leading upscale, restaurant/entertainment concepts with 33 locations throughout the United States and in Canada. More information on the company, including the latest investor presentation is available on the company’s website, www.daveandbusters.com.
“Safe Harbor” Statements Under the Private Securities Litigation Reform Act of 1995
Certain information contained in this press release includes forward-looking statements. Forward-looking statements include statements regarding our expectations, beliefs, intentions, plans, projections, objectives, goals, strategies, future events or performance and underlying assumptions and other statements which are other than statements of historical facts. These statements may be identified, without limitations, by the use of forward-looking terminology such as “may,” “will,” “anticipates,” “expects,” “projects,” “believes,” “intends,” “should,” or comparable terms or the negative thereof. All forward-looking statements included in this press release are based on information available to us on the date hereof. Such statements speak only as of the date hereof. These statements involve risks and uncertainties that could cause actual results to differ materially from those described in the statements. These risks and uncertainties include, but are not limited to, the following: our ability to open new high-volume restaurant/entertainment complexes; our ability to raise and access sufficient capital in the future; changes in consumer preferences, general economic conditions or consumer discretionary spending; the outbreak or continuation of war or other hostilities involving the United States; potential fluctuation in our quarterly operating result due to seasonality and other factors; the continued service of key management personnel; our ability to attract, motivate and retain qualified personnel; the impact of federal, state or local government regulations relating to our personnel or the sale of food or alcoholic beverages; the impact of litigation; the effect of competition in our industry; additional costs associated with compliance with the Sarbanes-Oxley Act and related regulations and requirements; and other risk factors described from time to time in our reports filed with the SEC.
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DAVE & BUSTER’S, INC.
Condensed Consolidated Balance Sheets
(in thousands)
(unaudited)
| August 1, 2004 |
February 1, 2004 |
|||||||
| ASSETS | ||||||||
Current assets: |
||||||||
Cash and cash equivalents |
$ | 5,037 | $ | 3,897 | ||||
Other current assets |
32,338 | 31,460 | ||||||
Total current assets |
37,375 | 35,357 | ||||||
Property and equipment, net |
248,517 | 247,161 | ||||||
Other assets and deferred charges |
14,431 | 13,371 | ||||||
Total assets |
$ | 300,323 | $ | 295,889 | ||||
LIABILITIES AND STOCKHOLDERS’ EQUITY |
||||||||
Total current liabilities |
$ | 34,512 | $ | 35,577 | ||||
Other long-term liabilities |
27,204 | 27,222 | ||||||
Long-term debt |
47,167 | 50,201 | ||||||
Stockholders’ equity: |
||||||||
Common stock |
134 | 132 | ||||||
Paid-in capital |
121,167 | 118,669 | ||||||
Restricted stock awards |
1,124 | 905 | ||||||
Retained earnings |
70,861 | 65,029 | ||||||
| 193,286 | 184,735 | |||||||
Less: treasury stock |
1,846 | 1,846 | ||||||
Total stockholders’ equity |
191,440 | 182,889 | ||||||
Total liabilities and stockholders’ equity |
$ | 300,323 | $ | 295,889 | ||||
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DAVE & BUSTER’S, INC.
Consolidated Statements of Income
(dollars in thousands, except per share amounts)
(unaudited)
| 13 Weeks Ended | 13 Weeks Ended | |||||||||||||||
| August 1, 2004 |
August 3, 2003 |
|||||||||||||||
Food and beverage revenues |
$ | 47,030 | 52.3 | % | $ | 45,613 | 51.7 | % | ||||||||
Amusement and other revenues |
42,814 | 47.7 | % | 42,696 | 48.3 | % | ||||||||||
Total revenues |
89,844 | 100.0 | % | 88,309 | 100.0 | % | ||||||||||
Cost of revenues |
17,283 | 19.2 | % | 16,544 | 18.7 | % | ||||||||||
Operating payroll and benefits |
25,545 | 28.4 | % | 25,951 | 29.4 | % | ||||||||||
Other store operating expenses |
29,123 | 32.4 | % | 28,058 | 31.8 | % | ||||||||||
General and administrative expenses |
5,800 | 6.5 | % | 6,396 | 7.2 | % | ||||||||||
Depreciation and amortization expense |
7,417 | 8.3 | % | 7,394 | 8.4 | % | ||||||||||
Preopening costs |
136 | 0.2 | % | — | — | |||||||||||
Total operating expenses |
85,304 | 95.0 | % | 84,343 | 95.5 | % | ||||||||||
Operating income |
4,540 | 5.0 | % | 3,966 | 4.5 | % | ||||||||||
Interest expense, net |
1,102 | 1.2 | % | 1,748 | 2.0 | % | ||||||||||
Income before provision for income taxes |
3,438 | 3.8 | % | 2,218 | 2.5 | % | ||||||||||
Provision for income taxes |
1,214 | 1.3 | % | 754 | 0.8 | % | ||||||||||
Net income |
$ | 2,224 | 2.5 | % | $ | 1,464 | 1.7 | % | ||||||||
Net income per share |
||||||||||||||||
Basic |
$ | 0.17 | $ | 0.11 | ||||||||||||
Diluted |
$ | 0.16 | $ | 0.11 | ||||||||||||
Weighted average shares outstanding |
||||||||||||||||
Basic weighted average shares outstanding |
13,319 | 13,116 | ||||||||||||||
Diluted weighted average shares outstanding |
16,486 | 13,458 | ||||||||||||||
Other information: |
||||||||||||||||
Company operated stores open |
33 | 32 | ||||||||||||||
EBITDA, which is earnings before interest, taxes, depreciation and amortization, is used by management, bankers and investors to evaluate a company’s ability to repay debt and for compliance of certain debt covenants. The computation of EBITDA follows:
Total net income |
$ | 2,224 | $ | 1,464 | ||||
Add back: depreciation and amortization |
7,417 | 7,394 | ||||||
interest expense, net |
1,102 | 1,748 | ||||||
provision for income taxes |
1,214 | 754 | ||||||
| $ | 11,957 | $ | 11,360 | |||||
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DAVE & BUSTER’S, INC.
Consolidated Statements of Income
(dollars in thousands, except per share amounts)
(unaudited)
| 26 Weeks Ended | 26 Weeks Ended | |||||||||||||||
| August 1, 2004 |
August 3, 2003 |
|||||||||||||||
Food and beverage revenues |
$ | 96,051 | 52.0 | % | $ | 93,277 | 51.9 | % | ||||||||
Amusement and other revenues |
88,759 | 48.0 | % | 86,619 | 48.1 | % | ||||||||||
Total revenues |
184,810 | 100.0 | % | 179,896 | 100.0 | % | ||||||||||
Cost of revenues |
35,004 | 18.9 | % | 33,215 | 18.5 | % | ||||||||||
Operating payroll and benefits |
52,473 | 28.4 | % | 52,750 | 29.3 | % | ||||||||||
Other store operating expenses |
58,715 | 31.8 | % | 56,250 | 31.2 | % | ||||||||||
General and administrative expenses |
12,096 | 6.5 | % | 12,335 | 6.9 | % | ||||||||||
Depreciation and amortization expense |
14,883 | 8.1 | % | 14,701 | 8.2 | % | ||||||||||
Preopening costs |
139 | 0.1 | % | — | — | |||||||||||
Total operating expenses |
173,310 | 93.8 | % | 169,251 | 94.1 | % | ||||||||||
Operating income |
11,500 | 6.2 | % | 10,645 | 5.9 | % | ||||||||||
Interest expense, net |
2,580 | 1.4 | % | 3,808 | 2.1 | % | ||||||||||
Income before provision for income taxes |
8,920 | 4.8 | % | 6,837 | 3.8 | % | ||||||||||
Provision for income taxes |
3,078 | 1.6 | % | 2,324 | 1.3 | % | ||||||||||
Net income |
$ | 5,842 | 3.2 | % | $ | 4,513 | 2.5 | % | ||||||||
Net income per share
|
||||||||||||||||
Basic |
$ | 0.44 | $ | 0.34 | ||||||||||||
Diluted |
$ | 0.40 | $ | 0.34 | ||||||||||||
Weighted average shares outstanding |
||||||||||||||||
Basic weighted average shares outstanding |
13,262 | 13,103 | ||||||||||||||
Diluted weighted average shares outstanding |
16,376 | 13,383 | ||||||||||||||
Other information: |
||||||||||||||||
Company operated stores open |
33 | 32 | ||||||||||||||
EBITDA, which is earnings before interest, taxes, depreciation and amortization, is used by management, bankers and investors to evaluate a company’s ability to repay debt and for compliance of certain debt covenants. The computation of EBITDA follows:
Total net income |
$ | 5,842 | $ | 4,513 | ||||
Add back: depreciation and amortization |
14,883 | 14,701 | ||||||
interest expense, net |
2,580 | 3,808 | ||||||
provision for income taxes |
3,078 | 2,324 | ||||||
| $ | 26,383 | $ | 25,346 | |||||
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DAVE & BUSTER’S, INC.
Consolidates Statements of Cash Flow
(dollars in thousands)
(unaudited)
| 26 Weeks Ended | 26 Weeks Ended | |||||||
| August 1, 2004 |
August 3, 2003 |
|||||||
Cash flows from operating activities: |
||||||||
Net income |
$ | 5,842 | $ | 4,513 | ||||
Adjustments to reconcile net income |
||||||||
to net cash provided by operating activities: |
||||||||
Depreciation and amortization |
14,883 | 14,701 | ||||||
Deferred income tax benefit |
(1,998 | ) | (52 | ) | ||||
Tax benefit related to stock options |
493 | 52 | ||||||
Restricted stock awards |
219 | 149 | ||||||
Warrants related to convertible debt |
128 | — | ||||||
(Gain) loss on sale of assets |
(47 | ) | 72 | |||||
Changes in operating assets and liabilities |
||||||||
Inventories |
(167 | ) | 1,036 | |||||
Prepaid expenses |
(1,582 | ) | (144 | ) | ||||
Other current assets |
871 | (29 | ) | |||||
Other assets and deferred charges |
(1,066 | ) | 281 | |||||
Accounts payable |
507 | (1,255 | ) | |||||
Accrued liabilities |
929 | 690 | ||||||
Income taxes payable |
(2,007 | ) | 2,286 | |||||
Other liabilities |
1,485 | 934 | ||||||
Net cash provided by operating activities |
18,490 | 23,234 | ||||||
Cash flows from investing activities: |
||||||||
Capital expenditures |
(16,580 | ) | (13,718 | ) | ||||
Proceeds from sales of property and equipment |
390 | 245 | ||||||
Net cash used in investing activities |
(16,190 | ) | (13,473 | ) | ||||
Cash flows from financing activities: |
||||||||
Borrowings under long-term debt |
3,250 | 5,250 | ||||||
Repayments of long-term debt |
(6,417 | ) | (11,700 | ) | ||||
Proceeds from exercises of stock options |
2,007 | 368 | ||||||
Net cash used in financing activities |
(1,160 | ) | (6,082 | ) | ||||
Increase in cash and cash equivalents |
1,140 | 3,679 | ||||||
Beginning cash and cash equivalents |
3,897 | 2,530 | ||||||
Ending cash and cash equivalents |
$ | 5,037 | $ | 6,209 | ||||
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