Westbury, NY-based Nathan’s Famous has reported results for the fiscal year ending 31 March 2002. Earnings before income taxes were US$2.21m compared to US$3.02m for year ended 25 March 2001.
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Net earnings for the FY 2002 period were US$1.25m or US$0.18 per diluted share as compared to US$1.60m or US$0.23 per diluted share in the prior fiscal year.
During the FY 2002 period, earnings before income taxes included gains of US$1.23m from the sale of three properties, impairment charges of US$870,000 in connection with long-lived assets and notes receivable, US$450,000 of litigation expenses and the reversal of a previously recorded litigation reserve of US$210,000 in connection with the company’s
successful appeal. Earnings before income taxes for the FY 2001 period included revenue of US$479,000 in connection with the introduction of a consolidated food distribution agreement, a US$500,000 transfer fee in connection with the change in ownership of its principal supermarket licensee and incurred lease termination expenses of US$462,000.
Total revenues were US$44.40m in FY 2002 compared to US$47.17m in FY 2001. Systemwide sales of the company’s brands, including supermarket sales by the company’s hot dog licensee, were US$265m for the FY 2002, compared to US$287m for FY 2001.
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By GlobalDataLosses before income taxes for the Q4 2002 were US$1.13m, compared to US$207,000 for the Q4 2001. Net losses for the Q4 2002 were US$630,000, compared to US$217,000 in the prior fiscal year. Total revenues were US$10.36m in the Q4 2002 as compared to US$10.19m in the Q4 2001.
The company also reported the following:
– In the initial weeks following the events of 11 September 2001, there was a decline in revenues in a significant number of company-owned and franchised restaurants operating primarily in Las Vegas, South Florida and at airports throughout the US. Sales have continued to be negatively impacted in the South Florida market.
– Fewer company-owned restaurants operated, primarily due to the Miami Subs divestiture strategy, which lowered revenues by about US$3.7m but improved restaurant profits by about US$30,000 (excluding any one time gains or future royalties ) as compared to the FY 2001.
– The introduction of extensive co-branding into the Miami Subs restaurant system, enabling the July 2001 launch of its new “Miami Subs Plus” concept in South Florida. Currently, 133 of the company’s Nathan’s, Miami Subs and Kenny Rogers Roasters restaurants are co-branded and include another of its brands or the Arthur Treacher’s brand.
– The Branded Product Programme, featuring the sale of Nathan’s hot dogs to the foodservice industry, continues to grow, generating sales of about US$4.86m during FY 2002, compared to US$3.85m during the FY 2001.
– Sales of Nathan’s products sold in supermarkets and club stores continue to result in year over year increases in royalties, increasing 6.8% for FY 2002 over the FY 2001.
– The purchase of 792,691 shares of its common stock through 7 June 2002 since its adoption of a share repurchase programme on 14 September 2001.
Today Nathan’s Famous consists of 364 franchised or licensed units, 22 company-owned units, and approximately 1,500 Branded Product points of sale, located within 39 states, the District of Columbia and 14 foreign countries.
