Founders Food & Firkins Ltd. (Nasdaq: GCFBU) announced yesterday that revenues for the Company’s third quarter, the thirteen weeks ended September 24, 2000, totaled $1,071,136, compared to $1,130,308 for the same period in 1999. Company officials noted that the decrease in revenues was less than had been anticipated and was due to the “honeymoon effect” experienced in 1999. The effect is experienced in the first eight weeks after a restaurant is initially opened; during this period a high customer count is attracted in the hope of developing a stable customer base. The Company opened its first restaurant on June 30, 1999. Average weekly revenues for September of 2000 were above those reported for September 1999, the first month after the “honeymoon effect” ended.
Net income for the most recent period was $23,321, or $0.01 per share, compared to net income of $65,906, or $0.03 per share one year ago. Income from restaurant operations for the quarter was $157,799, compared to $144,926 for the same period one year ago. General administrative expenses grew from $18,539 a year ago to $129,793. The increase is the result of additional corporate personnel now on payroll to open and oversee future restaurant locations, as well as St. Cloud.
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Revenues for the thirty-nine weeks ended September 24, 2000, were $2,928,465, compared to $1,130,308 for the same period in 1999. The Company reported a net loss for thirty-nine weeks ended September 24, 2000 of $(22,946), or $(0.01) per share, compared to a net loss of $(98,163), or $(0.05) per share, for the first three quarters of 1999.
Steven J. Wagenheim, President and Chief Executive Officer of the Company, stated, “The results of the quarter demonstrate the strong, positive response we have received in St. Cloud and the overall strength of our concept, which emphasizes great food, great beer and exceptional service.”
Wagenheim noted that Founders has broken ground for the Sioux Falls, S.D. site of its second Granite City location. The restaurant will enjoy a premier location in South Dakota’s largest city, near major commercial retailers such as Home Depot, a multi-plex movie theatre, several hotels and within walking distance of the Empire Mall.
“We are extremely excited about our prospects in the Sioux Falls market and look forward to announcing our opening date,” he concluded.
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By GlobalDataThe Company’s initial public offering went effective June 6, 2000. As a result of the offering, the Company sold 1,000,000 units for $4.125 per unit, each unit consisting of one share of common stock and one redeemable Class A warrant. Net proceeds of the offering are estimated to be approximately $3,275,000.
Founders Food & Firkins Ltd. operates Granite City Food & Brewery, a full service casual dining restaurant featuring an on-premise brewery. Granite City provides fresh, high quality, made-to-order food and handcrafted beers. Granite City offers a broad menu of traditional and regional foods served in generous portions at reasonable prices, designed to offer customers an excellent value and pleasant dining experience.
The Company’s releases may contain certain non-historical forward-looking terminology such as “believes,” “anticipates,” “expects” and “intends,” or comparable terminology. Such statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those projected. Potential purchasers of the Company’s securities are cautioned not to place undue reliance on such forward-looking statements. Please refer to the Company’s Current Report on Form 8-K, filed on July 5, 2000, for factors that may cause actual results to vary.
FOUNDERS FOOD & FIRKINS LTD.
CONDENSED BALANCE SHEET
(Unaudited)
September 24,
2000
Assets:
Current assets:
Cash $665,117
Short-term investments 2,162,437
Inventory 39,426
Prepaids and other 31,607
Income taxes receivable 5,371
Total current assets 2,903,958
Property and equipment, net 3,586,326
Other 16,922
License 162,665
3,765,913
Total assets $6,669,871
Liabilities and shareholders' equity:
Current liabilities:
Accounts payable $226,471
Accrued expenses 155,162
Due to related parties 55,962
Capital lease obligations, current portion 117,000
Total current liabilities 554,595
Capital lease obligations, net of current
portion 2,041,724
Shareholders' equity:
Common stock, 3,807,350 shares issued and
outstanding 38,074
Additional paid in capital 4,412,849
Accumulated deficit (377,371)
4,073,552
Total liabilities and shareholders' equity $6,669,871
FOUNDERS FOOD & FIRKINS LTD.
CONDENSED STATEMENTS OF OPERATIONS
(Unaudited)
Thirteen weeks ended Thirty-nine weeks ended
September 24, September 26, September 24, September 26,
2000 1999 2000 1999
Restaurant revenues $1,071,136 $1,130,308 $2,928,465 $1,130,308
Restaurant costs:
Food and beverage 311,405 316,882 866,336 316,882
Labor 361,259 450,267 996,051 450,267
Direct and occupancy 180,653 164,014 539,449 164,014
Depreciation 60,020 54,219 179,823 54,219
Total restaurant
costs 913,337 985,382 2,581,659 985,382
Income from restaurant
operations 157,799 144,926 346,806 144,926
Pre-opening costs 2,713 7,163 194,193
General and
administrative 129,793 18,539 268,159 33,689
Operating income (loss) 25,293 126,387 71,484 (82,956)
Net interest (expense)
income (1,972) (55,060) (94,430) (49,639)
Income (loss) before
taxes 23,321 71,327 (22,946) (132,595)
Income tax (expense)
benefit (5,421) 34,432
Net income (loss) $23,321 $65,906 $(22,946) $(98,163)
Earnings (loss) per
common share $.01 $.03 $(.01) $(.05)
Earnings (loss) per
common share, assuming
dilution $.01 $.03 $(.01) $(.05)
Weighted average shares
outstanding 3,807,350 1,969,500 2,694,780 1,969,500
Weighted average shares
outstanding, assuming
dilution 3,908,432 1,969,500 3,285,895 1,969,500
For more information, contact Steven J. Wagenheim, President and Chief Executive Officer of Founders Food & Firkins Ltd., 612-525-2070.
