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8-K - FORM 8-K - O CHARLEYS INC | g25511e8vk.htm |
Exhibit 99.1
NEWS RELEASE
CONTACTS
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Larry Hyatt | Gene Marbach | ||
Chief Financial Officer | Investor Relations | |||
OCharleys Inc. | Makovsky + Company | |||
(615) 782-8982 | (212) 508-9600 |
OCHARLEYS INC. ANNOUNCES RESTAURANT CLOSINGS
NASHVILLE, Tenn. (December 13, 2010) OCharleys Inc. (NASDAQ: CHUX) today announced that
it has closed 11 underperforming OCharleys restaurants and five underperforming Ninety Nine
restaurants.
David Head, president and chief executive officer of OCharleys Inc. said, Our decision to
close these restaurants was a difficult one as we understand the impact this has on our team
members and the communities we serve. We deeply appreciate the hard work, passion and enthusiasm of
our team members and managers at the affected locations. Everyone impacted by this decision has
been offered severance payments, and where geographically feasible we are working hard to find
opportunities for these team members at other OCharleys and Ninety Nine restaurants, as well as
with restaurants operated by our competitors.
These closings permit us to focus our energy and efforts on improving the performance of our
remaining 339 company-operated restaurants in 25 states. We continue to strongly believe in the
potential of our three concepts which enjoy high brand loyalty and guest appeal. We expect to
continue to focus on our turnaround plan which centers on ensuring that every guest experiences
great food, great service and strong value while we manage our costs to profitability.
Eight of the 16 closed restaurants will be treated as discontinued operations in the Companys
financial statements. Not including the discontinued operations, the Company estimates that total
pretax charges in the fourth quarter of 2010 relating to these closings for asset impairment,
future lease obligations and severance will be approximately $5.0 million. The Company estimates
that the closing of these 16 restaurants will increase annual income from operations by
approximately $1.5 million, and will increase annual Adjusted EBITDA by approximately $1.0 million.
About OCharleys Inc.
OCharleys Inc., (NASDAQ: CHUX), headquartered in Nashville, Tenn., is a multi-concept
restaurant company. After the restaurant closings announced today, the Company operates or
franchises a total of 348 restaurants under three brands: OCharleys, Ninety Nine Restaurants, and
Stoney River Legendary Steaks. The OCharleys concept includes 230 restaurants in 19 states in the
Southeast and Midwest, including 221 company-owned and operated OCharleys restaurants, and 9
restaurants operated by franchisees. The menu, with an emphasis on fresh preparation, features
several specialty items, such as hand-cut and aged USDA choice steaks, a variety of seafood and
chicken, freshly baked yeast rolls, fresh salads with special-recipe salad dressings and signature
caramel pie. The company operates Ninety Nine Restaurants in 107 locations throughout New England
and Upstate New York. Ninety Nine has earned a strong reputation as a friendly, comfortable place
to gather and enjoy great American food and drink at a terrific price. The menu features a wide
selection of appetizers, salads, sandwiches, burgers, entrees and desserts. The company operates 11
Stoney River Legendary Steaks restaurants in six states in the Southeast and Midwest. The
steakhouse concept appeals to both upscale casual-dining and fine-dining guests by offering
high-quality food and attentive customer service typical of high-end steakhouses, but at more
moderate prices.
Forward Looking Statement
The forward looking statements in this press release and statements made by or on behalf of
the Company relating hereto, including those containing words like forecast, expect, project,
believe, may, could, anticipate, and estimate, are subject to the safe harbor provisions
of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are
subject to the completion of the Companys fourth quarter financial and accounting procedures, and
may be affected by certain risks and uncertainties, including, but not limited to, the accuracy of
the estimated charges relating to the store closings and the impact of such closings on our future
results of operations, the deterioration in the United States economy and the related adverse
effect on our sales of reduced consumer spending; the Companys ability to comply with the terms
and conditions of its financing agreements; the Companys ability to maintain or increase
operating margins and same-store sales at its restaurants; the effect that increases in food,
labor, energy, interest costs and other expenses have on our results; the effect of increased
competition; the Companys ability to sell closed restaurants and other surplus assets;
and the other risks described in the Companys filings with the Securities and Exchange Commission.
In light of the significant uncertainties inherent in the forward-looking statements included
herein, you should not regard the inclusion of such information as a representation by us that our
objectives, plans and projected results of operations will be achieved and the Companys actual
results could differ materially from such forward-looking statements. The Company does not
undertake any obligation to publicly release any revisions to the forward-looking statements
contained herein to reflect events and circumstances occurring after the date hereof or to reflect
the occurrence of unanticipated events.