Famous Dave’s of America, Inc. has announced revenue and net income of $37.1 million and $1.2 million, respectively, or $0.14 per diluted share, for the first quarter ended April 3, 2011. This compares to revenue and net income of $32.6 million and $2.7 million, respectively, or $0.30 per diluted share, for the comparable period in 2010. First quarter 2011 results include a non-cash impairment charge of approximately $148,000 or $0.01 per diluted share, primarily related to non-recoverable assets for a company-owned restaurant that will be relocated within its existing market in early 2013. Fiscal 2010’s first quarter included a $0.15 gain from the acquisition of seven New York and New Jersey franchise restaurants in March 2010.
Same store sales for company-owned restaurants open for 24 months or more increased 3.0 percent during the quarter and included a weighted average price increase of approximately 2.0 percent. Additionally, the year over year shift of the Easter holiday from the first quarter of 2010 to the second quarter of 2011 had a favorable impact of approximately 70 basis points on the quarter.
“While we are encouraged by our first quarter comparable sales and revenue performance, we recognize that we have more work to do to improve our results,” said Christopher O’Donnell, President and CEO of Famous Dave’s of America. “We continue to focus diligently on growing sales and controlling costs in this unpredictable environment in order to continue to deliver better results for our shareholders.”
Franchise royalty revenue for the first quarter of 2011 totaled $4.0 million, essentially flat to the comparable period in 2010. The results year over year reflect a net increase of seven franchise-operated restaurants, offset by the loss of two months of franchise royalties for the seven New York and New Jersey restaurants and a 0.1% decline in franchise comparable sales.
Stock-based and Board of Directors Cash Compensation and Common Share Repurchase
Earnings results for the first quarter of 2011 included approximately $422,000 or $0.03 per diluted share, in compensation expense related to the company’s stock-based incentive programs and board of directors’ cash compensation, as compared to approximately $355,000 or $0.03 per diluted share, for the prior year comparable period. The year over year increase is primarily due to a higher stock price.
The company repurchased approximately 246,000 shares of common stock during the first quarter at an average price of $10.28 per share, excluding commissions, for a total of approximately $2.5 million. The company has repurchased approximately 420,000 shares under its current 1.0 million share authorization at an average price of $10.30 per share, excluding commissions, for a total of approximately $4.3 million.
Marketing and Development
Development and marketing highlights during the quarter included a successful “limited time offer” of “Citrus Grill” entrees featuring six items, paired with a side of broccoli and grilled pineapple steaks at less than 600 calories each.
The current limited time offering, “Best in Smoke,” is inspired by our founder, Dave Anderson’s upcoming television appearance on the ultimate BBQ showdown, “Best in Smoke”, on Food Network®, and features two new recipes, “Smokin’ Blackberry Lettuce Wraps” and “Smokin’ Blackberry Ribs.” The multi-episode, single elimination competition begins May 8, 2011 at 10 p.m. Eastern and Pacific Time. We are also offering our brisket with a Dr. Pepper glaze and a beer pairing with Sam Adams Blackberry Witbier.
Famous Dave’s opened three new franchise-operated restaurants during the first quarter, in Lawrence, KS, Reno, NV and Henderson, NV. Three franchise-operated locations closed during the quarter in Omaha, NE, Pensacola, FL, and Kansas City, KS. Famous Dave’s ended the quarter with 182 restaurants, including 52 company-owned restaurants and 130 franchise-operated restaurants, located in 37 states.
The company reiterates its guidance on restaurant development, as issued in its fourth quarter earnings release, and anticipates opening approximately 12 new restaurants in fiscal 2011, including one company-owned restaurant.
Famous Dave’s of America, Inc. develops, owns, operates and franchises barbeque restaurants. As of today, the company owns 52 locations and franchises 130 additional locations in 37 states, and is known for its on-premise real pit smokers, scratch-recipe cooking, and over 500 national and regional awards. Its menu features award-winning barbequed and grilled meats, an ample selection of salads, side items, sandwiches, and unique desserts.