Attached files
| file | filename |
|---|---|
| EX-32.2 - EPL Intermediate, Inc. | v184821_ex32-2.htm |
| EX-31.1 - EPL Intermediate, Inc. | v184821_ex31-1.htm |
| EX-31.2 - EPL Intermediate, Inc. | v184821_ex31-2.htm |
| EX-10.1 - EPL Intermediate, Inc. | v184821_ex10-1.htm |
| EX-32.1 - EPL Intermediate, Inc. | v184821_ex32-1.htm |
| 10-Q - EPL Intermediate, Inc. | v184821_10q.htm |
Exhibit
99.1
EPL
Intermediate, Inc. Announces Results for the
13
Weeks Ended March 31, 2010
COSTA
MESA, CA-- (BUSINESS WIRE) – May 17, 2010 - EPL Intermediate, Inc. (“El Pollo
Loco” or the “Company”), parent company of El Pollo Loco, Inc., today reported
results for the 13 weeks ended March 31, 2010.
El Pollo
Loco reported operating revenue for the 13-week period ended March 31, 2010 of
$68.0 million, which is a decrease of $2.6 million, or 3.7%, compared to
operating revenue for the 13-week period ended April 1, 2009 of $70.6
million. Operating revenue includes both sales at company-operated
stores and franchise revenue.
The
decrease in operating revenue was primarily attributed to a 6.7% decrease in
system-wide same-store sales for the first quarter of 2010 compared to the first
quarter of 2009. Restaurants enter the comparable restaurant base for
same-store sales the first full week after that restaurant’s 15-month
anniversary.
Commenting
on results for the first quarter of 2010, Stephen E. Carley, president and CEO
of El Pollo Loco, Inc. said, “Our sales continued to be impacted by
disproportionately high unemployment in our core markets and increased frugality
among dine-out consumers.”
“Despite
the difficult economy, the January launch of our flame-grilled Carne Asada style
Sirloin steak struck a responsive chord with consumers and we generated
impressive trial of our steak entrees. For the first quarter, steak
represented approximately 25% of our sales in the Mexican entrée category, which
mainly excludes our family meals. We also drove family meal purchases
and additional trial of our flame-grilled steak in the first quarter with a FREE
Steak & 3-Cheese Quesadilla with the purchase of a 9- or 14-piece Family
Feast chicken meal promotion.”
Operating
income increased $0.3 million, or 7.6%, to $4.4 million for the first 13 weeks
of 2010 from $4.0 million for the first 13 weeks of 2009.
Interest
expense, net of interest income, increased $3.2 million, or 52.7%, to $9.2
million for the first 13 weeks of 2010 from $6.0 million for the first 13 weeks
of 2009. Average debt balances for the first 13 weeks of 2010
increased to $268.2 million compared to $240.7 million for the first 13 weeks of
2009. The increase was mainly due to higher average debt balance and
interest rate compared to the prior year period.
Our
provision for income taxes consisted of an income tax expense of $0.7 million
for the first 13 weeks of 2010 compared to an income tax benefit of $0.1 million
in the first 13 weeks of 2009. This income tax expense was primarily
related to the effect of changes in our deferred taxes and the related effect of
maintaining a full valuation allowance against certain of our deferred tax
assets as of March 31, 2010.
As a
result of the factors cited above, there was a net loss for the 13 weeks ended
March 31, 2010 of $5.6 million compared to a net loss of $1.3 million for the
same 13 weeks of 2009.
Commenting
on the remainder of 2010, Carley said, “In the months ahead we plan to maintain
the delicate balance between providing value and protecting average check by
introducing flavorful new products that leverage our flame-grilling expertise;
focusing on our Loco Value Menu; and continuing to provide value with
compelling family meal offers.”
El Pollo
Loco’s restaurant count changes for the first 13 weeks of 2010 are as
follows:
|
Company
|
Franchised Stores
|
Total
|
||||||||||
|
December
30, 2009
|
172 | 243 | 415 | |||||||||
|
Opened
|
- | - | - | |||||||||
|
Closed
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1 | 2 | 3 | |||||||||
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At
March 31, 2010
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171 | 241 | 412 | |||||||||
Addressing
the Company’s growth, Mr. Carley said, “We expect to open fewer restaurants this
year than last, due in part to the continued difficulty franchisees are having
securing financing in this challenging economy and the impact the economic
crisis has had on our franchisees, several of whom have delayed or reduced the
number of new restaurants they plan to open. No new restaurants
opened in the first quarter of 2010 and three restaurants closed during this
timeframe, which included one company and one franchise restaurant in the
Chicago area and one franchise restaurant in Yuma, AZ.”
“We plan
to open two company stores in 2010 to conserve capital and expect our
franchisees to open three to four restaurants this year. Restaurants
scheduled to open in 2010 will be located in areas where El Pollo Loco already
has a presence.”
System-wide
Sales
Included
above is system-wide same-store sales information. System-wide sales are a
financial measure that includes sales at all company-owned stores and
franchise-owned stores, as reported by franchisees. Management uses system-wide
sales information internally in connection with store development decisions,
planning and budgeting analyses. Management believes system-wide sales
information is useful in assessing consumer acceptance of the Company’s brand
and facilitates an understanding of financial performance as the Company’s
franchisees pay royalties and contribute to advertising pools based on a
percentage of their sales.
Safe Harbor
Statement
This news
release contains forward-looking statements, which are statements that do not
relate solely to historical fact. They include, but are not limited
to, any statement that may predict, forecast, indicate or imply future results,
performance, achievements or events. They may contain words such as
“believe,” “anticipate,” “expect,” “estimate,” “intend,” “project,” “plan,”
“will,” “should,” “may,” “could” or words or phrases of similar
meaning. The statements reflect management's current expectations
regarding future events. Factors that could cause actual results to
differ materially from those expressed or implied by the forward-looking
statements include but are not limited to the adverse impact of economic
conditions on our operating results and
financial condition, on our ability to comply with the terms and covenants of
our debt agreements, and on our ability to pay or to refinance our existing debt
or to obtain additional financing; our substantial level of indebtedness;
food-borne-illness incidents; negative publicity, whether or not valid;
increases in the cost of chicken; our dependence upon frequent deliveries
of food and other supplies; our vulnerability to changes in consumer preferences
and economic conditions; our sensitivity to events and conditions in the greater
Los Angeles area, our largest market; our ability to compete successfully with
other quick service and fast casual restaurants; our ability to expand into new
markets; our reliance on our franchisees, who have also been adversely impacted
by the recession; matters relating to labor laws and the adverse impact of
related litigation, including wage and hour class actions; our ability to
support our franchise system; our ability to renew leases at the end
of their term; the impact of applicable federal, state or local government
regulations; our ability to protect our name and logo and other proprietary
information; litigation we face in connection with our operations; and other
risk factors listed from time to time in the Company's reports filed with the
Securities and Exchange Commission. Statements about the Company’s
past performance are not necessarily indicative of its future
results. The Company undertakes no obligation to publicly update or
revise any forward-looking statement, whether as the result of new information,
future events or otherwise.
About the
Company
El Pollo
Loco® is the nation’s leading restaurant concept specializing in flame-grilled
chicken. Headquartered in Costa Mesa, California, El Pollo Loco, Inc.
operates a restaurant system comprised of 171 company-operated and 241
franchised restaurants (as of March 31, 2010) located primarily in California,
with additional restaurants in Arizona, Colorado, Connecticut, Georgia,
Illinois, Missouri, Nevada, New Jersey, Oregon, Texas, Utah and
Virginia. El Pollo Loco’s menu features the Company’s signature
citrus-marinated, flame-grilled chicken in individual and family-size meals
served with a choice of corn or flour tortillas, freshly-prepared salsas and an
assortment of side orders. El Pollo Loco also serves a variety of
contemporary, Mexican-inspired entrees featuring the chain’s citrus-marinated,
flame-grilled chicken and Carne Asada-style Sirloin steak, including Pollo Bowl®
entrees, pollo salads, grilled burritos, tacos, quesadillas and
more. For more information about the Company, visit www.elpolloloco.com.
|
Contacts:
|
Gary
Campanaro
|
Julie
Weeks
|
|
Chief
Financial Officer
|
Vice
President of Communications
|
|
|
El
Pollo Loco, Inc.
|
El
Pollo Loco, Inc.
|
|
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714.599.5155
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714.599.5150
|
|
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gcampanaro@elpolloloco.com
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jweeks@elpolloloco.com
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Summary Financial
Information
EPL
INTERMEDIATE, INC.
(A
Wholly Owned Subsidiary of El Pollo Loco Holdings, Inc.)
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(Amounts
in thousands)
|
13
Weeks Ended
April
1,
|
13
Weeks Ended
March
31,
|
|||||||
|
2009
|
2010
|
|||||||
|
OPERATING
REVENUE:
|
||||||||
|
Restaurant
revenue
|
$ | 65,925 | $ | 63,418 | ||||
|
Franchise
revenue
|
4,708 | 4,574 | ||||||
|
Total
operating revenue
|
70,633 | 67,992 | ||||||
|
OPERATING
EXPENSES:
|
||||||||
|
Product
cost
|
20,961 | 19,778 | ||||||
|
Payroll
and benefits
|
17,688 | 17,529 | ||||||
|
Depreciation
and amortization
|
2,830 | 2,581 | ||||||
|
Other
operating expenses
|
25,109 | 23,751 | ||||||
|
Total
operating expenses
|
66,588 | 63,639 | ||||||
|
OPERATING
INCOME
|
4,045 | 4,353 | ||||||
|
INTEREST
EXPENSE--Net
|
6,044 | 9,232 | ||||||
|
CHANGE
IN FAIR VALUE OF INTEREST RATE SWAP
|
(203 | ) | - | |||||
|
OTHER
INCOME
|
(452 | ) | - | |||||
|
LOSS
BEFORE PROVISION FOR INCOME TAXES
|
(1,344 | ) | (4,879 | ) | ||||
|
(BENEFIT)
PROVISION FOR INCOME TAXES
|
(67 | ) | 745 | |||||
|
NET
LOSS
|
$ | (1,277 | ) | $ | (5,624 | ) | ||
See notes
to condensed consolidated financial statements (unaudited).
Results
of Operations
Our
operating results for the 13 weeks ended April 1, 2009 and March 31, 2010 are
expressed as a percentage of restaurant revenue below:
|
|
13 Weeks Ended
|
|||||||
|
April
1,
2009
|
March
31,
2010
|
|||||||
|
Operating
Statement Data:
|
||||||||
|
Restaurant
revenue
|
100.0
|
%
|
100.0
|
%
|
||||
|
Product
cost
|
31.8
|
31.2
|
||||||
|
Payroll
and benefits
|
26.8
|
27.6
|
||||||
|
Depreciation
and amortization
|
4.3
|
4.1
|
||||||
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Other
operating expenses
|
38.1
|
37.5
|
||||||
|
Operating
income
|
6.1
|
6.9
|
||||||
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Interest
expense-net
|
9.2
|
14.6
|
||||||
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Change
in fair value of interest rate swap
|
(0.3
|
)
|
0.0
|
|||||
|
Other
income
|
(0.7
|
)
|
0.0
|
|||||
|
Loss
before provision for income taxes
|
(2.0
|
)
|
(7.7
|
)
|
||||
|
Provision
(benefit) for income taxes
|
(0.1
|
)
|
1.2
|
|||||
|
Net
loss
|
(1.9
|
)
|
(8.9
|
)
|
||||
|
Supplementary
Operating Statement Data:
|
||||||||
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Restaurant
other operating expense
|
22.8
|
24.8
|
||||||
|
Franchise
expense
|
1.5
|
1.6
|
||||||
|
General
and administrative expense (1)
|
13.8
|
11.1
|
||||||
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Total
other operating expenses
|
38.1
|
37.5
|
||||||
(1)
General and administrative expenses as a percent of total operating revenue for
2009 and 2010 were 12.8% and 10.3%, respectively.