HOUSTON, Nov. 6 /PRNewswire-FirstCall/ -- Landry's Restaurants,
Inc. (NYSE: LNY; the "Company"), today announced its results for
the third quarter ended September 30, 2009. Revenues from
continuing operations for the three months ended September 30,
2009, totaled $276.6 million, as compared to $289.7 million a year
earlier. Revenues from the restaurant and hospitality group were
$224.2 million and $229.1 million for the third quarter of 2009 and
2008, respectively and $52.4 million and $60.6 million for the same
periods from the Golden Nugget properties. Interest expense for the
third quarter of 2009 was $29.3 million compared to $19.5 million
in the third quarter of 2008 primarily due to higher interest rates
resulting from the Company's refinancing in 2009 and higher
borrowings associated with construction of the new tower at the
Golden Nugget. Income from continuing operations for the quarter
was $8.9 million, compared to a loss of $7.6 million reported last
year. On a pre-tax basis, results for the third quarter of 2009
include a $19.4 million gain on debt extinguishment, while the
comparable period in the prior year included an $18.5 million
impairment loss primarily from Hurricane Ike. In addition, the 2009
third quarter includes a $6.2 million non-cash pre-tax loss on the
value of interest rate swaps not designated as hedges as compared
to a loss of $1.8 million during the same period in 2008. Earnings
per share-diluted from continuing operations for the quarter were
$0.55, compared to a loss of $0.47 last year. Excluding the effect
of the above items, earnings per share-diluted from continuing
operations for the quarter would have been $.02 for 2009, as
compared to $0.35 for 2008. Same store sales for the Company's
restaurants were negative 6.5% while gaming operations were
negative 13.1% for the quarter. Excluding the non-recurring items
described above, Adjusted EBITDA, as defined below, for the quarter
was $49.4 million as compared to $48.8 million in the same period
in the prior year. Restaurant and hospitality contributed $42.0
million compared to $36.5 million in the prior year while gaming
operations contributed $7.3 million in the third quarter of 2009
versus $12.4 million in the third quarter of 2008. Revenues from
continuing operations for the nine months ended September 30, 2009,
totaled $814.9 million, as compared to $890.2 million a year
earlier. For the same periods, restaurant and hospitality revenues
were $650.0 million and $693.2 million, respectively, while gaming
operations revenues totaled $164.9 million and $196.9 million,
respectively. Net earnings from continuing operations for the nine
months were $24.3 million, compared to $8.9 million reported last
year. Earnings per share-diluted from continuing operations for the
nine months were $1.50, compared to $0.55 in 2008. Rick Liem,
Executive Vice President and CFO stated, "Operating income from the
restaurant and hospitality group held up well in a very difficult
economic environment. Results from the gaming operations reflect
lower traffic compounded by heightened competitive pressure,
particularly on room rates. We expect to open the new tower at the
Golden Nugget at the end of November 2009, slightly in advance of
the approximately 6,000 rooms opening in December at City Center."
As a result of the Company's 2006 sale of the Joe's Crab Shack
concept and closure of certain additional locations, the results of
operations for these restaurants are reflected as discontinued
operations in the Company's financial statements. The loss from
discontinued operations, net of taxes, for the quarter ended
September 30, 2009 was $0.1 million or $0.01 per share-diluted
compared to a loss of $9.5 million or $0.59 per share-diluted in
the prior year. For the nine months ended September 30, 2009, the
loss from discontinued operations, net of tax was $0.2 million or
$0.01 per share-diluted as compared to a loss of $10.5 million or
$0.65 per share-diluted in the prior year. Therefore, the
consolidated net income for the current year quarter was $8.8
million or $0.54 per share-diluted, compared to net loss of $17.1
million or $1.06 per share - diluted in the comparable period in
2008. Consolidated, net income for the nine months ended September
30, 2009 was $1.49 per share-diluted compared to a net loss of
$0.10 per share-diluted for the comparable period in the prior
year. Net income available to the Company's common stockholders for
the three and nine months ended September 30, 2009 was $6.7 million
and $19.3 million or $0.41 and $1.19 per share diluted,
respectively as compared to a $17.1 million loss and $1.7 million
loss or ($1.06) and ($0.10) per share diluted for the prior year.
The Company has determined that it did not properly consider the
accreted value of its redeemable non-controlling interests in its
T-Rex subsidiary in its determination of net income available to
Landry's common stockholders in the first and second quarter of
2009. The Company will amend its quarterly filings on Form 10-Q.
Such amendment will have no effect on the Company's cash flows or
financial position. The amended filings will reflect the following.
Three Months Ended Three Months Ended March 31, 2009 June 30, 2009
-------------- ------------- As reported As restated As reported As
restated ----------- ----------- ----------- ----------- Net income
(loss) attributable to Landry's 7,073,246 7,073,246 8,265,312
8,265,312 Redeemable noncontrolling interest - (1,064,763) -
(1,660,878) --- ---------- --- ---------- Net income available to
Landry's common stockholders $7,073,246 $6,008,483 $8,265,312
$6,604,434 ========== ========== ========== ========== EARNINGS
(LOSS) PER SHARE INFORMATION: Amounts attributable to Landry's:
BASIC Net income (loss) attributable to Landry's $0.44 $0.44 $0.51
$0.51 Redeemable noncontrolling interest $- $(0.07) $- $(0.10) ---
------ --- ------ Net income available to Landry's common
stockholders $0.44 $0.37 $0.51 $0.41 ===== ===== ===== =====
Weighted average number of common shares outstanding 16,140,000
16,140,000 16,140,000 16,140,000 DILUTED Net income (loss)
attributable to Landry's $0.44 $0.44 $0.50 $0.50 Redeemable
noncontrolling interest $- $(0.07) $- $(0.09) --- ------ --- ------
Net income available to Landry's common stockholders $0.44 $0.37
$0.50 $0.41 ===== ===== ===== ===== Weighted average number of
common and common share equivalents outstanding 16,155,000
16,155,000 16,205,000 16,205,000 Six Months Ended June 30, 2009
------------- As reported As restated ----------- ----------- Net
income (loss) attributable to Landry's 15,338,558 15,338,558
Redeemable noncontrolling interest - (2,725,641) --- ---------- Net
income available to Landry's common stockholders $15,338,558
$12,612,917 =========== =========== EARNINGS (LOSS) PER SHARE
INFORMATION: Amounts attributable to Landry's: BASIC Net income
(loss) attributable to Landry's $0.95 $0.95 Redeemable
noncontrolling interest $- $(0.17) --- ------ Net income available
to Landry's common stockholders $0.95 $0.78 ===== ===== Weighted
average number of common shares outstanding 16,140,000 16,140,000
DILUTED Net income (loss) attributable to Landry's $0.95 $0.95
Redeemable noncontrolling interest $- $(0.17) --- ------ Net income
available to Landry's common stockholders $0.95 $0.78 ===== =====
Weighted average number of common and common share equivalents
outstanding 16,180,000 16,180,000 On November 3, 2009, the Company
announced it had entered into a definitive merger agreement with
Mr. Tilman J. Fertitta's acquisition company, a company
wholly-owned by Tilman J. Fertitta, Chairman, Chief Executive
Officer and President of Landry's. Mr. Fertitta's acquisition
company would acquire all of Landry's outstanding common stock not
already owned by Mr. Fertitta for $14.75 per share in cash, a 37%
premium over the closing share price of Landry's common stock on
the last trading day before the announcement of the transaction.
The total value of the transaction is approximately $1.2 billion.
On November 2, 2009, Mr. Fertitta beneficially owned approximately
55.1% of Landry's outstanding shares of common stock. As previously
announced, in August 2009, the Board of Directors formed a Special
Committee comprised entirely of outside, non-employee directors to
review strategic alternatives. The Special Committee retained legal
advisors and engaged Moelis & Company as its financial advisor.
At that time, Mr. Fertitta had proposed to the Special Committee a
going private transaction which would have resulted in Landry's
stockholders receiving shares of Landry's Saltgrass, Inc.
subsidiary in exchange for their Landry's shares. After reviewing
the proposal, the Special Committee rejected Mr. Fertitta's
proposal as inadequate. Mr. Fertitta then proposed an all-cash
transaction, which led to the negotiation and execution of the
merger agreement. The proposed merger transaction is subject to
approval by Landry's stockholders, including approval by the
holders of a majority of Landry's common stock not owned by Mr.
Fertitta. The transaction is also subject to Landry's refinancing a
portion of its outstanding debt. The transaction is expected to be
completed in the first half of 2010, subject to regulatory
approvals and other customary closing conditions. The Company's
continuing operations include restaurants primarily under the trade
names Landry's Seafood House, Chart House, Rainforest Cafe,
Saltgrass Steak House and the Signature Group as well as other
businesses including hotels, marinas, amusements, retail and the
Golden Nugget Hotels and Casinos in Las Vegas and Laughlin, Nevada.
Adjusted EBITDA is not a generally accepted accounting principles
("GAAP") measurement. The Company defines Adjusted EBITDA as
earnings from continuing operations before interest income and
expense, taxes, depreciation, amortization, asset impairment
expenses, non-cash gain or loss on interest rate swaps not deemed
hedges, non recurring items and non-cash stock based compensation
expenses, and is presented solely as a supplemental disclosure
because the Company believes that it is a widely used measure of
operating performance in the restaurant and gaming industry.
Adjusted EBITDA is not intended to be viewed as a source of
liquidity or as a cash flow measure as used in the statement of
cash flows. Adjusted EBITDA is simply shown above as it is a
commonly used non-GAAP valuation statistic and is used by
management to evaluate operating performance. In addition, this
press release contains certain forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934, as amended,
which are intended to be covered by safe harbors created thereby.
Stockholders are cautioned that all forward-looking statements are
based largely on Landry's expectations and involve risks and
uncertainties, some of which cannot be predicted or are beyond
Landry's control. A statement containing a projection of revenue,
income, earnings per share, same store sales, capital expenditures,
or future economic performance, or whether the merger agreement
will be consummated are just a few examples of forward-looking
statements. Some factors that could realistically cause results to
differ materially from those projected in the forward-looking
statements include the occurrence of any event, change or other
circumstances that could give rise to the termination of the merger
agreement with Mr. Fertitta's acquisition company; the inability to
complete the merger due to the failure to obtain stockholder
approval for the merger or the failure to satisfy other conditions
to completion of the merger, including the receipt of all
regulatory approvals related to the merger; the failure to obtain
the necessary financing arrangements pursuant to the merger
agreement; risks that the proposed transaction disrupts current
plans and operations and the potential difficulties in employee
retention as a result of the merger; the ability to recognize the
benefits of the merger; the effect of local and national economic,
credit and capital market conditions on the economy in general, and
on the gaming, restaurant and hotel industries in particular;
changes in laws, including increased tax rates, regulations or
accounting standards, third-party relations and approvals, and
decisions of courts, regulators and governmental bodies; litigation
outcomes and judicial actions; acts of war or terrorist incidents
or natural disasters; the effects of competition, including
locations of competitors and operating and market competition;
ineffective marketing or promotions, competition, weather, store
management turnover, a weak economy, higher interest rates and gas
prices; construction at the Golden Nugget properties; negative same
store sales; or Landry's inability to continue its expansion
strategy. Additional factors that could cause results to differ
materially from those described in the forward-looking statements
can be found in Landry's 2008 Annual Report on Form 10-K and in
Landry's other filings with the Securities and Exchange Commission
(the "SEC") available at the SEC's Web site at http://www.sec.gov/.
Landry's may not update or revise any forward-looking statements
made in this press release. About the Transaction In connection
with the proposed merger, Landry's will file a proxy statement with
the Securities and Exchange Commission. INVESTORS AND SECURITY
HOLDERS ARE STRONGLY ADVISED TO READ THE PROXY STATEMENT WHEN IT
BECOMES AVAILABLE BECAUSE IT WILL CONTAIN IMPORTANT INFORMATION.
Investors and security holders may obtain a free copy of the proxy
statement (when available) and other documents filed by Landry's
from the SEC's Web site at http://www.sec.gov/. The proxy statement
and such other documents may also be obtained for free from
Landry's website at http://www.landrysrestaurants.com/ or by
directing such request to Landry's Restaurants, Inc., Investor
Relations, 1510 West Loop South, Houston, Texas 77027, telephone:
(713) 3867000. Landry's and its directors, executive officers and
certain other members of its management and employees may be deemed
to be participants in the solicitation of proxies from its
stockholders in connection with the proposed merger. Information
regarding the interests of Landry's participants in the
solicitation will be included in the proxy statement relating to
the proposed merger when it becomes available. Additional
information regarding Landry's directors and executive officers is
also included in Landry's proxy statement for its Combined 2008 and
2009 Annual Meeting of Stockholders, which was filed with the SEC
on April 3, 2009. This document is available free of charge from
the SEC's Web site at http://www.sec.gov/, from Landry's website at
http://www.landrysrestaurants.com/ or by directing such request to
Landry's Restaurants, Inc., Investor Relations, 1510 West Loop
South, Houston, Texas 77027, telephone: (713) 386-7000. LANDRY'S
RESTAURANTS, INC. CONSOLIDATED INCOME STATEMENTS (000's except per
share amounts)
--------------------------------------------------------------- FOR
THE FOR THE QUARTER ENDED QUARTER ENDED September 30, September 30,
2009 2008 ------------- ------------- REVENUES $276,609 100.0%
$289,736 100.0% -------- ----- -------- ----- COST OF REVENUES
56,884 20.6% 62,269 21.5% LABOR 89,630 32.4% 92,675 32.0% OTHER
OPERATING EXPENSES 70,335 25.4% 73,829 25.5% ------ ---- ------
---- UNIT LEVEL PROFIT 59,760 21.6% 60,963 21.0% GENERAL &
ADMINISTRATIVE 11,544 4.2% 11,732 4.0% PRE-OPENING COSTS 178 0.1%
552 0.2% DEPRECIATION & AMORTIZATION 17,903 6.5% 17,745 6.1%
GAIN ON INSURANCE CLAIMS (407) -0.1% - 0.0% LOSS (GAIN) ON DISPOSAL
OF ASSETS 0.0% - 0.0% ASSET IMPAIRMENT EXPENSE 608 0.2% 18,492 6.4%
--- --- ------ --- TOTAL OPERATING INCOME 29,934 10.8% 12,442 4.3%
OTHER EXPENSE 16,045 22,149 ------ ------ INCOME FROM CONTINUING
OPERATIONS BEFORE TAXES 13,889 (9,707) TAX PROVISION (BENEFIT)
5,026 (2,126) ----- ------ INCOME FROM CONTINUING OPERATIONS 8,863
(7,581) INCOME (LOSS) FROM DISCONTINUED OPERATIONS, NET OF TAXES
(56) (9,474) --- ------ NET INCOME (LOSS) $8,807 $(17,055) ======
======== REDEEMABLE NONCONTROLLING INTEREST (2,085) - NET INCOME
AVAILABLE TO STOCKHOLDERS $6,722 $(17,055) ====== ======== EARNINGS
(LOSS) PER SHARE - BASIC: INCOME FROM CONTINUING OPERATIONS $0.55
$(0.47) INCOME (LOSS) FROM DISCONTINUED OPERATIONS - (0.59) ---
----- NET INCOME (LOSS) 0.55 (1.06) REDEEMABLE NONCONTROLLING
INTEREST (0.13) - ----- --- NET INCOME AVAILABLE TO STOCKHOLDERS
$0.42 $(1.06) ===== ====== AVERAGE SHARES 16,140 16,140 EARNINGS
(LOSS) PER SHARE - DILUTED: INCOME FROM CONTINUING OPERATIONS $0.55
$(0.47) INCOME (LOSS) FROM DISCONTINUED OPERATIONS (0.01) (0.59)
----- ----- NET INCOME (LOSS) 0.54 (1.06) REDEEMABLE NONCONTROLLING
INTEREST (0.13) - ----- --- NET INCOME AVAILABLE TO STOCKHOLDERS
$0.41 $(1.06) ===== ====== AVERAGE SHARES 16,220 16,140 Adjusted
EBITDA (earnings before interest, taxes, depreciation and
amortization): Net income $8,807 $(17,055) Add back: Loss from
discontinued operations 56 9,474 Tax provision (benefit) 5,026
(2,126) Interest expense, net 29,310 19,491 Depreciation and
amortization 17,903 17,745 Asset impairment expense 608 18,492
Swaps 6,237 1,820 Gain on debt buy back (19,406) - Stock based
compensation 838 1,006 Adjusted EBITDA $49,379 $48,847 FOR THE NINE
FOR THE NINE MONTHS ENDED MONTHS ENDED September 30, September 30,
2009 2008 ------------- ------------- REVENUES $814,904 100.0%
$890,160 100.0% -------- ----- -------- ----- COST OF REVENUES
167,187 20.5% 191,642 21.5% LABOR 261,444 32.1% 284,874 32.0% OTHER
OPERATING EXPENSES 197,535 24.2% 224,092 25.2% ------- ---- -------
---- UNIT LEVEL PROFIT 188,738 23.2% 189,552 21.3% GENERAL &
ADMINISTRATIVE 36,225 4.4% 36,876 4.1% PRE-OPENING COSTS 894 0.1%
1,392 0.2% DEPRECIATION & AMORTIZATION 53,365 6.5% 53,121 6.0%
GAIN ON INSURANCE CLAIMS (4,411) -0.5% - 0.0% LOSS (GAIN) ON
DISPOSAL OF ASSETS (1,363) -0.2% - 0.0% ASSET IMPAIRMENT EXPENSE
608 0.1% 20,085 2.2% --- --- ------ --- TOTAL OPERATING INCOME
103,420 12.7% 78,078 8.8% OTHER EXPENSE 69,160 64,052 ------ ------
INCOME FROM CONTINUING OPERATIONS BEFORE TAXES 34,260 14,026 TAX
PROVISION (BENEFIT) 9,960 5,152 ----- ----- INCOME FROM CONTINUING
OPERATIONS 24,300 8,874 INCOME (LOSS) FROM DISCONTINUED OPERATIONS,
NET OF TAXES (155) (10,536) ---- ------- NET INCOME (LOSS) $24,145
$(1,662) ======= ======= REDEEMABLE NONCONTROLLING INTEREST (4,811)
- NET INCOME AVAILABLE TO STOCKHOLDERS $19,334 $(1,662) ======
======= EARNINGS (LOSS) PER SHARE - BASIC: INCOME FROM CONTINUING
OPERATIONS $1.51 $0.55 INCOME (LOSS) FROM DISCONTINUED OPERATIONS
(0.01) (0.65) ----- ----- NET INCOME (LOSS) 1.50 (0.10) REDEEMABLE
NONCONTROLLING INTEREST (0.30) - ----- --- NET INCOME AVAILABLE TO
STOCKHOLDERS $1.20 $(0.10) ===== ====== AVERAGE SHARES 16,140
16,140 EARNINGS (LOSS) PER SHARE - DILUTED: INCOME FROM CONTINUING
OPERATIONS $1.50 $0.55 INCOME (LOSS) FROM DISCONTINUED OPERATIONS
(0.01) (0.65) ----- ----- NET INCOME (LOSS) 1.49 (0.10) REDEEMABLE
NONCONTROLLING INTEREST (0.30) - ----- --- NET INCOME AVAILABLE TO
STOCKHOLDERS $1.19 $(0.10) ===== ====== AVERAGE SHARES 16,195
16,140 Adjusted EBITDA (earnings before interest, taxes,
depreciation and amortization): Net income $24,145 $(1,662) Add
back: Loss from discontinued operations 155 10,536 Tax provision
(benefit) 9,960 5,152 Interest expense, net 82,466 60,175
Depreciation and amortization 53,365 53,121 Asset impairment
expense 608 20,085 Swaps 1,307 2,054 Gain on debt buy back (19,406)
- Stock based compensation 2,668 3,064 Adjusted EBITDA $155,268
$152,525 Adjusted EBITDA is not a generally accepted accounting
principles ("GAAP") measurement and is presented solely as a
supplemental disclosure because the Company believes that it is a
widely used measure of operating performance in the restaurant
industry. Adjusted EBITDA is not intended to be viewed as a source
of liquidity or as a cash flow measure as used in the statement of
cash flows. Adjusted EBITDA is simply shown above as it is a
commonly used non-GAAP valuation statistic. LANDRY'S RESTAURANTS,
INC. CONDENSED UNAUDITED BALANCE SHEETS ($ in Millions except per
share amounts) September 30, 2009 December 31, 2008
------------------ ------------------- (unaudited) Cash &
equivalents $45.0 $51.1 Assets related to discontinued operations
3.0 3.0 Other current assets 67.2 81.2 ---- ---- Total current
assets 115.2 135.3 Property & equipment, net 1,329.9 1,259.2
Other assets 122.0 120.8 ----- ----- Total assets $1,567.1 $1,515.3
======== ======== Current liabilities $212.1 $216.3 Liabilities
related to discontinued operations 3.6 5.1 Long-term debt 906.1
862.3 Other non-current 114.2 136.1 ----- ----- Total liabilities
1,236.0 1,219.8 Total stockholders' equity 331.1 295.5 ----- -----
Total liabilities & equity $1,567.1 $1,515.3 ======== ========
DATASOURCE: Landry's Restaurants, Inc. CONTACT: Tilman J. Fertitta,
Chairman, President & C.E.O., or Rick H. Liem, Executive Vice
President & C.F.O., both of Landry's Restaurants, Inc.,
+1-713-850-1010 Web Site: http://www.landrysrestaurants.com/
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