BUCA, Inc. Announces 4th Quarter and Full Year 2007 Financial Results

BUCA, Inc. (NASDAQ: BUCA) today announced financial results for its fourth quarter and full year of fiscal 2007. The company reported a net loss of $5.3 million, or ($0.26) per share, in the fourth quarter of fiscal 2007, compared with net income of $0.9 million, or $0.05 per share, in the fourth quarter of fiscal 2006. For the fiscal year 2007, the Company reported a net loss of $16.2 million, or ($0.79) per share, compared with a net loss of $3.6 million, or ($0.18) per share, in fiscal 2006. The fourth quarter of fiscal 2007 contained 13 weeks as compared to the fourth quarter of fiscal 2006 which contained 14 weeks. John Bettin, the company’s Chief Executive Officer commented, "The recent restaurant environment has been challenging for us and for the industry. While we are disappointed with our recent results, we did make progress on several initiatives designed to improve average unit volumes as we work toward profitability. During fiscal 2007, we continued to evolve and strengthen the Buca di Beppo brand, implementing initiatives such as catering and our single portion option called BUCA Mio, which we believe are resonating well with our guests. On the cost side, we implemented a new labor management system, which is beginning to drive improvement as shown by our year over year labor savings in the fourth quarter of fiscal 2007, and we delivered improvement in product costs on a year-over-year basis.” Fourth Quarter Results Total restaurant sales were $64.1 million in the fourth quarter of fiscal 2007 as compared to $71.5 million in the fourth quarter of fiscal 2006. The decrease in total restaurant sales was due to the fourth quarter of fiscal 2007 being a 13-week period as compared to 14-week in fiscal 2006, the closure of two underperforming restaurants in the first half of fiscal 2007, the loss of sales due to the temporary closure of the Company's San Francisco restaurant during parts of the quarter and the fact that the fourth quarter of fiscal 2007 did not include New Year's Eve. No new restaurants opened in the period. Buca di Beppo comparable restaurant sales decreased 2.5% for the fourth quarter of fiscal 2007 as compared to the same period last year. The comparable restaurant sales numbers reported exclude the results of the Company’s San Francisco restaurant for the entire fourth fiscal quarters for each of 2006 and 2007. The restaurant, one of the Company’s highest sales locations, was closed for renovation beginning September 24, 2007 and reopened on November 20, 2007. The company reported a net loss of $5.3 million, or ($0.26) per share, in the fourth quarter of fiscal 2007 as compared to net income of $0.9 million, or $0.05 per share, in the same period of the prior year. The net loss in the fourth quarter of fiscal 2007 includes a loss on disposal of assets of $0.5 million related to repairs and renovation of the Company’s San Francisco restaurant and asset impairment charges of $4.3 million. Total restaurant costs in the fourth quarter of fiscal 2007 were $60.1 million, as compared to $64.5 million in the same period of the prior year. As a percentage of restaurant sales, these costs were 93.8% for the fourth quarter of fiscal 2007, as compared to 90.1% in the fourth quarter of fiscal 2006. Fiscal Year 2007 Results For fiscal 2007, total restaurant sales were $245.6 million as compared to $253.8 million in fiscal 2006. The decrease in restaurant sales was primarily due to a shift in the Company's fiscal calendar caused by the 53rd week of fiscal 2006 which removed the relatively high sales week prior to and including New Year's Eve from the Company's first quarter of fiscal 2007 and New Year's Eve from the Company's fourth quarter of fiscal 2007. The Company's fiscal 2007 results also reflect the closure of two underperforming restaurants in the first half of 2007, the loss of sales due to the temporary closure of the Company's San Francisco restaurant during parts of the third and fourth fiscal quarters and a decrease in beverage sales. Buca di Beppo comparable restaurant sales increased 0.7% for fiscal 2007 as compared to the same period last year. The comparable restaurant sales numbers reported exclude the results of the Company’s San Francisco restaurant for the entire third and fourth fiscal quarters for each of 2006 and 2007. The reported revenue numbers include all of the Company's revenues for all periods, including those of the San Francisco restaurant. The company reported a net loss of $16.2 million, or ($0.79) per share, in fiscal 2007, as compared to a net loss from continuing operations of $4.6 million, or ($0.23) per share, in fiscal 2006. The fiscal 2007 net loss includes a loss on disposal of assets of $0.9 million related to repairs and renovation of the Company’s San Francisco restaurant and asset impairment charges of $5.1 million. Total restaurant costs were $233.4 million in fiscal 2007 as compared to $234.7 million in fiscal 2006. As a percentage of restaurant sales, these costs were 95.1% for fiscal 2007, as compared to 92.5% in fiscal 2006. Conference Call BUCA, Inc. will host a conference call on Tuesday, March 11, 2008 at 4:30 p.m. Eastern Time (3:30 p.m. Central Time) to discuss these results. John Bettin the company’s Chief Executive Officer, and Dennis Goetz Chief Financial Officer, will be hosting the call. The participant call in number is 1-888-778-9067 or 1-913-312-0962 for international callers. The passcode is 6484508. The call will be webcast and can be accessed but cutting and pasting the following link: http://viavid.net/dce.aspx?sid=00004B3A into your browser. If you are unable to join the call, a replay will be available beginning at 7:30 p.m. Eastern Time on March 11, 2008 and can be accessed by dialing 1-888-203-1112 or 1-719-457-0820 (international), passcode 6484508. About the Company: BUCA, Inc. owns and operates 89 highly acclaimed Italian restaurants under the name Buca di Beppo in 25 states and the District of Columbia. BUCA, Inc. and Subsidiaries Consolidated Statements of Operations (in thousands, except share and per share data)     Fourth Quarter Ended December 30, 2007   December 31, 2006 Restaurant sales $ 64,117 $ 71,531 Restaurant costs: Product 15,770 17,858 Labor 21,032 23,384 Direct and occupancy 19,923 20,158 Depreciation and amortization 2,776 2,992 Loss on disposal of assets   646     71   Total restaurant costs 60,147 64,463   General and administrative expenses 4,432 5,752 Loss on impairment of long-lived assets   4,251     50   Operating (loss) income (4,713 ) 1,266   Interest income 31 154 Interest expense   (614 )   (707 ) (Loss) income before income taxes (5,296 ) 713 Income taxes   -     -   Net (loss) income from continuing operations (5,296 ) 713 Net (loss) income from discontinued operations   (1 )   230   Net (loss) income $ (5,297 ) $ 943   Net (loss) income from continuing operations per share—basic and diluted $ (0.26 ) $ 0.04 Net income from discontinued operations per share—basic and diluted $ -   $ 0.01   Net (loss) income per share—basic and diluted $ (0.26 ) $ 0.05   Weighted average common shares outstanding—basic   20,498,675     20,474,325   Weighted average common shares outstanding—diluted   20,498,675     20,693,862   BUCA, Inc. and Subsidiaries Consolidated Statements of Operations (in thousands, except share and per share data)     Fiscal Year Ended December 30, 2007   December 31, 2006 Restaurant sales $ 245,552 $ 253,813 Restaurant costs: Product 60,659 63,307 Labor 83,796 83,771 Direct and occupancy 75,794 74,884 Depreciation and amortization 11,462 12,224 Loss on disposal of assets   1,702     559   Total restaurant costs 233,413 234,745   General and administrative expenses 20,934 20,635 Loss on impairment of long-lived assets 5,051 282 Lease termination charges   (3 )   -   Operating loss (13,843 ) (1,849 )   Interest income 427 221 Interest expense   (2,551 )   (2,933 ) Loss before income taxes (15,967 ) (4,561 ) Income taxes   -     -   Net loss from continuing operations (15,967 ) (4,561 ) Net (loss) income from discontinued operations   (208 )   953   Net loss $ (16,175 ) $ (3,608 ) Net loss from continuing operations per share—basic and diluted $ (0.78 ) $ (0.23 ) Net (loss) income from discontinued operations per share—basic and diluted $ (0.01 ) $ 0.05   Net loss per share—basic and diluted $ (0.79 ) $ (0.18 ) Weighted average common shares outstanding—basic and diluted   20,451,954     20,494,007   BUCA, Inc. and Subsidiaries Consolidated Balance Sheets ($ in thousands)   December 30,2007   December 31,2006 ASSETS CURRENT ASSETS: Cash $ 1,070 $ 1,567 Accounts receivable 4,260 4,864 Inventories 6,084 6,279 Prepaid expenses and other   4,470     4,468   Total current assets $ 15,884 17,178   PROPERTY AND EQUIPMENT, net 98,327 112,189 NOTE RECEIVABLE - 3,567 OTHER ASSETS   3,186     4,469   $ 117,397   $ 137,403     LIABILITIES AND SHAREHOLDERS’ EQUITY CURRENT LIABILITIES: Accounts payable $ 6,634 $ 10,755 Unredeemed gift card liabilities 3,738 4,031 Accrued payroll and benefits 7,483 8,806 Accrued sales, property and income tax 3,897 3,678 Other accrued expenses 4,876 3,495 Current maturities of long-term debt and capital leases 296 193 Current liabilities of discontinued operations and assets held for sale   -     257   Total current liabilities   26,924     31,215     LONG-TERM DEBT AND CAPITAL LEASES, less current maturities 15,993 16,278 DEFERRED RENT 18,002 18,853 OTHER LIABILITIES   3,962     4,037   Total liabilities   64,881     70,383     COMMITMENTS AND CONTINGENCIES SHAREHOLDERS’ EQUITY: Undesignated stock, 5,000,000 shares authorized, none issued or outstanding - - Common stock, $.01 par value per share, 30,000,000 shares authorized;21,088,651 and 20,926,556 shares issued and outstanding, respectively 211 209 Additional paid-in capital 172,903 171,430 Accumulated deficit (119,678 ) (103,503 ) Notes receivable from employee shareholders   (920 )   (1,116 ) Total shareholders’ equity   52,516     67,020   $ 117,397   $ 137,403