Morton’s Restaurant Group Reports Results for Second Quarter 2011


Morton's Restaurant Group Reports Results for Second Quarter 2011Morton’s Restaurant Group has reported unaudited financial results for its fiscal 2011 second quarter ended July 3, 2011.

Financial results for the three month period ended July 3, 2011, compared to the three month period ended July 4, 2010

  • Revenues increased 10.7% to $78.0 million from $70.5 million.
  • Comparable restaurant revenues for Morton’s steakhouses increased 8.2%.
  • Income from continuing operations attributable to controlling interest was $0.7 million, or $0.04 per diluted share, for the three month period ended July 3, 2011, compared to $0.3 million, or $0.02 per diluted share, for the three month period ended July 4, 2010.
  • The three month period ended July 3, 2011 included a charge of $0.2 million, or $0.01 per diluted share, relating to professional fees associated with the previously announced exploration of strategic alternatives.
  • Adjusted income from continuing operations was $0.9 million, or $0.05 per diluted share, for the three month period ended July 3, 2011, compared to $0.3 million, or $0.02 per diluted share, for the three month period ended July 4, 2010. Refer to the reconciliation of adjusted income from continuing operations to GAAP income from continuing operations in the tables that follow for additional details.

Financial results for the six month period ended July 3, 2011, compared to the six month period ended July 4, 2010

  • Revenues increased 10.1% to $160.5 million from $145.8 million.
  • Comparable restaurant revenues for Morton’s steakhouses increased 7.8%.
  • Income from continuing operations attributable to controlling interest was $2.8 million, or $0.16 per diluted share, for the six month period ended July 3, 2011, compared to $1.5 million, or $0.09 per diluted share, for the six month period ended July 4, 2010.
  • The six month period ended July 3, 2011 included a charge of $0.9 million, or $0.05 per diluted share, relating to the settlement of certain wage and hour and similar labor claims as well as relating to professional fees associated with the previously announced exploration of strategic alternatives. The six month period ended July 4, 2010 included a final mark-to-market adjustment of $0.5 million, or $0.03 per diluted share, related to the Company’s convertible preferred shares issued in connection with the fiscal 2009 settlement of certain wage and hour litigation.
  • Adjusted income from continuing operations was $3.7 million, or $0.21 per diluted share, for the six month period ended July 3, 2011, compared to $2.0 million, or $0.12 per diluted share, for the six month period ended July 4, 2010. Refer to the reconciliation of adjusted income from continuing operations to GAAP income from continuing operations in the tables that follow for additional details.

“We are pleased to report a strong second quarter, with comparable restaurant revenue up by 8.2%, reflecting our sixth consecutive quarter with positive comparable revenues,” said Christopher J. Artinian, President and Chief Executive Officer of Morton’s Restaurant Group, Inc. “We also experienced an increase in overall traffic during the quarter, and our higher sales volumes were accompanied by expanded operating margins. In addition, business travel continues to trend positively, as evidenced by our increased traffic in convention markets. We remain well positioned to continue to grow our world recognized brand both domestically and internationally, especially in Asia. I remain especially proud of our employees who set the bar so high and consistently deliver the Morton’s Gold Standard experience to our guests, and who take such pride in serving ‘The Best Steak Anywhere!’”

Fiscal 2011 Financial Guidance

Actual results could differ materially from the guidance provided herein as a result of numerous factors, many of which are beyond the Company’s control and are highly dependent upon overall economic conditions. Please refer to the “Cautionary Note on Forward-Looking Statements” later in this press release in conjunction with this guidance.

The Company currently expects the following financial results for the third fiscal quarter of 2011:

  • Revenues to range between $71 million and $73 million;
  • Comparable restaurant revenues to increase approximately 6% to 7% as compared to the third quarter of fiscal 2010;
  • Diluted loss per share from continuing operations of approximately $(0.10) to $(0.12), excluding professional fees associated with the previously announced exploration of strategic alternatives; and
  • An estimated effective tax rate that is not expected to exceed 21%.

The Company currently expects the following financial results for the full year fiscal 2011:

  • Revenues to range between $320 million and $323 million;
  • Comparable restaurant revenues to increase approximately 6% to 8% as compared to the full year fiscal 2010;
  • Diluted income per share from continuing operations of approximately $0.45 to $0.49, excluding expenses relating to the settlement of certain wage and hour and similar labor claims as well as professional fees associated with the previously announced exploration of strategic alternatives; and
  • An estimated effective tax rate that is not expected to exceed 21%.

Development Activity

During fiscal year 2011, the Company expects to retrofit up to four Morton’s steakhouses to include a Bar 12?21, two of which were completed in the first quarter of fiscal 2011 and one which was completed more recently in our Singapore restaurant. In addition, we opened a new Morton’s steakhouse on February 24, 2011 in the Uptown area of Dallas, TX, which also includes a Bar 12?21 and have entered into a lease to open a new Morton’s steakhouse in the Tyson’s Corner area of Vienna, Virginia.