MINNEAPOLIS, April 28, 2015 (GLOBE NEWSWIRE) -- Buffalo Wild Wings, Inc. (Nasdaq:BWLD) announced today financial results for the first quarter ended March 29, 2015. Highlights for the first quarter versus the same period a year ago were:
- Total revenue increased 19.8% to $440.6 million
- Company-owned restaurant sales grew 20.3% to $415.0 million
- Same-store sales increased 7.0% at company-owned restaurants and 6.0% at franchised restaurants
- Net earnings increased 2.6% to $29.1 million from $28.3 million, and earnings per diluted share increased 1.7% to $1.52 from $1.49
Sally Smith, President and Chief Executive Officer, commented, "We're pleased with our first quarter same-store sales of 7.0% at company-owned restaurants and 6.0% at franchised locations. Sales were exceptionally strong during the college football bowl games as well as the NFL playoffs. Buffalo Wild Wings really came alive during March Madness® and we launched a new advertising campaign with unique commercials for each round of the tournament."
Ms. Smith continued, "Our sales growth leveraged operating, occupancy, and general and administrative costs. As anticipated, cost of sales and labor as a percentage of restaurant sales were higher than the prior year which tempered our net earnings growth. The price per pound for traditional chicken wings increased 41% versus the prior year's unusually low price. We achieved net earnings growth of 2.6% and earnings per diluted share was $1.52 in the first quarter."
Total revenue increased 19.8% to $440.6 million in the first quarter compared to $367.9 million in the first quarter of 2014. Company-owned restaurant sales for the quarter increased 20.3% over the same period in 2014, to $415.0 million, driven by a same-store sales increase at company-owned Buffalo Wild Wings restaurants of 7.0% and 53 additional Buffalo Wild Wings restaurants at the end of first quarter of 2015. Franchise royalties and fees increased 11.8% to $25.6 million for the quarter versus $22.9 million in the first quarter of 2014. This increase is attributed to a same-store sales increase at franchised Buffalo Wild Wings locations of 6.0% and 18 additional franchised Buffalo Wild Wings restaurants at the end of the period versus a year ago.
Average weekly sales for company-owned Buffalo Wild Wings restaurants were $64,851 for the first quarter of 2015 compared to $60,966 for the same quarter last year, a 6.4% increase. Franchised Buffalo Wild Wings restaurants in the United States averaged $67,075 for the period versus $63,852 in the first quarter a year ago, a 5.0% increase.
For the first quarter, net earnings increased 2.6% to $29.1 million versus $28.3 million in the first quarter of 2014. Earnings per diluted share were $1.52, as compared to first quarter 2014 earnings per diluted share of $1.49.
2015 Outlook
Ms. Smith remarked, "Same-store sales increased 4.2% at company-owned restaurants and 1.8% at franchised locations for the first four weeks of the second quarter of 2015 compared to 5.7% and 4.4%, respectively, for the same period last year. We launched B-Dubs® Fast Break, a system-wide lunch program that provides Guests speed and value during this daypart. We're bringing the World of Sports to Buffalo Wild Wings beginning in June, highlighting fun and unique sports from the U.S. and around the world. To further engage Guests, we'll have new in-restaurant games to play during the World of Sports promotion with prizes awarded daily and weekly."
Ms. Smith concluded, "Our focus remains on creating an engaging sports-viewing experience with great food and beverage offerings for our Guests and we continue to make progress in guest experience technology initiatives. Our net earnings growth goal for 2015 remains 18%."
Buffalo Wild Wings will be hosting a conference call today, April 28, 2015 at 4:00 p.m. Central Daylight Time to discuss these results. There will be a simultaneous webcast conducted at our investor website IR.BuffaloWildWings.com.
A replay of the call will be available until May 5, 2015. To access this replay, please dial 1.858.384.5517 password 5135891.
March Madness® is a trademark of the National Collegiate Athletic Association.
About the Company
Buffalo Wild Wings, Inc., founded in 1982 and headquartered in Minneapolis, is a growing owner, operator and franchisor of Buffalo Wild Wings® restaurants featuring a variety of boldly-flavored, made-to-order menu items including its namesake Buffalo, New York-style chicken wings. The Buffalo Wild Wings menu specializes in 21 mouth-watering signature sauces and seasonings with flavor sensations ranging from Sweet BBQ™ to Blazin'®. Guests enjoy a welcoming neighborhood atmosphere that includes an extensive multi-media system for watching their favorite sporting events. Buffalo Wild Wings is the recipient of hundreds of "Best Wings" and "Best Sports Bar" awards from across the country. There are currently more than 1,080 Buffalo Wild Wings locations in the United States, Canada, Mexico, and Philippines.
To stay up-to-date on all the latest events and offers for sports fans and wing lovers, like Buffalo Wild Wings on Facebook, follow @BWWings on Twitter and visit www.BuffaloWildWings.com.
Forward-looking Statements
Various remarks we make about future expectations, plans, and prospects for the company constitute forward-looking statements for purposes of the Safe Harbor provisions under the Private Securities Litigation Reform Act of 1995. These statements relate to our future financial and restaurant performance measures and growth goals, including but not limited to those relating to our second quarter sales trends and projected unit and net earnings growth rates for 2015, and beyond. All statements other than statements of historical fact are statements that could be deemed forward-looking statements and are based upon the current beliefs and expectations of our management. We have attempted to identify forward-looking statements by terminology, including "anticipates," "believes," "can," "continue," "could," "estimates," "expects," "intends," "may," "plans," "potential," "predicts," "should" or "will" or the negative of these terms or other comparable terminology. Actual results may vary materially from those contained in forward-looking statements based on a number of factors, including, but not limited to, our ability to achieve and manage our planned expansion, the ability of our franchisees to open and manage new restaurants, market acceptance in the new geographic regions we enter (particularly non-U.S. locations), success of acquired restaurants, success of investments in new or emerging concepts, unforeseen obstacles in developing nontraditional sites or non-U.S. locations, our ability to obtain and maintain licenses and permits necessary to operate our existing and new restaurants, our franchisees' adherence to our system standards, the cost of commodities such as traditional chicken wings and supply chain consistency, the success of our key initiatives and our advertising and marketing campaigns, our ability to control restaurant labor and other restaurant operating costs, the continued service of key management personnel, our ability to protect our name and logo and other proprietary information, economic conditions (including changes in consumer preferences or consumer discretionary spending), the impact of federal, state or local government regulations relating to our employees, the sale of food and alcoholic beverages, the effect of competition in the restaurant industry, and other factors disclosed from time to time in our filings with the U.S. Securities and Exchange Commission, including the factors described under "Risk Factors" in Part I, Item 1A of our Annual Report on Form 10-K for the fiscal year ended December 28, 2014, as updated in subsequent reports filed with the SEC. Investors should take such risks into account when making investment decisions. Shareholders and other readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date on which they are made. We undertake no obligation to update any forward-looking statements.
| BUFFALO WILD WINGS, INC. AND SUBSIDIARIES | ||
| CONSOLIDATED STATEMENTS OF EARNINGS | ||
| (Dollar and share amounts in thousands except per share data) | ||
| (unaudited) | ||
| Three months ended | ||
| March 29, | March 30, | |
| 2015 | 2014 | |
| Revenue: | ||
| Restaurant sales | $ 414,972 | 344,945 |
| Franchise royalties and fees | 25,614 | 22,910 |
| Total revenue | 440,586 | 367,855 |
| Costs and expenses: | ||
| Restaurant operating costs: | ||
| Cost of sales | 125,677 | 97,487 |
| Labor | 130,394 | 105,334 |
| Operating | 58,551 | 49,038 |
| Occupancy | 21,990 | 18,969 |
| Depreciation and amortization | 28,069 | 22,832 |
| General and administrative | 30,522 | 28,156 |
| Preopening | 1,270 | 2,578 |
| Loss on asset disposals and impairment | 605 | 787 |
| Total costs and expenses | 397,078 | 325,181 |
| Income from operations | 43,508 | 42,674 |
| Investment income (loss) | (75) | (127) |
| Earnings before income taxes | 43,433 | 42,547 |
| Income tax expense | 14,448 | 14,231 |
| Net earnings including noncontrolling interests | 28,985 | 28,316 |
| Net loss attributable to noncontrolling interests | (78) | — |
| Net earnings attributable to Buffalo Wild Wings | $ 29,063 | 28,316 |
| Earnings per common share – basic | $ 1.53 | 1.50 |
| Earnings per common share – diluted | $ 1.52 | 1.49 |
| Weighted average shares outstanding – basic | 18,993 | 18,873 |
| Weighted average shares outstanding – diluted | 19,074 | 18,953 |
The following table expresses results of operations as a percentage of total revenue for the periods presented, except for restaurant operating costs which are expressed as a percentage of restaurant sales:
| Three months ended | ||
|
March 29, 2015 |
March 30, 2014 |
|
| Revenue: | ||
| Restaurant sales | 94.2% | 93.8% |
| Franchise royalties and fees | 5.8 | 6.2 |
| Total revenue | 100.0 | 100.0 |
| Costs and expenses: | ||
| Restaurant operating costs: | ||
| Cost of sales | 30.3 | 28.3 |
| Labor | 31.4 | 30.5 |
| Operating | 14.1 | 14.2 |
| Occupancy | 5.3 | 5.5 |
| Depreciation and amortization | 6.4 | 6.2 |
| General and administrative | 6.9 | 7.7 |
| Preopening | 0.3 | 0.7 |
| Loss on asset disposals and impairment | 0.1 | 0.2 |
| Total costs and expenses | 90.1 | 88.4 |
| Income from operations | 9.9 | 11.6 |
| Investment income (loss) | — | — |
| Earnings before income taxes | 9.9 | 11.6 |
| Income tax expense | 3.3 | 3.9 |
| Net earnings including noncontrolling interests | 6.6 | 7.7 |
| Net loss attributable to noncontrolling interests | — | — |
| Net earnings attributable to Buffalo Wild Wings | 6.6% | 7.7% |
| BUFFALO WILD WINGS, INC. AND SUBSIDIARIES | ||
| CONSOLIDATED BALANCE SHEETS | ||
| (Dollar amounts in thousands) | ||
| (unaudited) | ||
| March 29, | December 28, | |
| 2015 | 2014 | |
| Assets | ||
| Current assets: | ||
| Cash and cash equivalents | $ 92,601 | 93,329 |
| Marketable securities | 21,017 | 19,547 |
| Accounts receivable, net of allowance of $25 | 30,393 | 28,322 |
| Inventory | 11,550 | 11,893 |
| Prepaid expenses | 9,817 | 4,215 |
| Refundable income taxes | — | 9,779 |
| Deferred income taxes | 16,435 | 15,807 |
| Restricted assets | 55,439 | 81,037 |
| Total current assets | 237,252 | 263,929 |
| Property and equipment, net | 494,866 | 494,401 |
| Reacquired franchise rights, net | 41,777 | 37,631 |
| Other assets | 19,237 | 19,399 |
| Goodwill | 40,625 | 38,106 |
| Total assets | $ 833,757 | 853,466 |
| Liabilities and Stockholders' Equity | ||
| Current liabilities: | ||
| Unearned franchise fees | $ 2,461 | 2,099 |
| Accounts payable | 33,850 | 37,241 |
| Accrued compensation and benefits | 39,190 | 59,161 |
| Accrued expenses | 13,236 | 16,573 |
| Income tax payable | 7,951 | — |
| Current portion of deferred lease credits | 499 | 743 |
| System-wide payables | 55,125 | 79,668 |
| Total current liabilities | 152,312 | 195,485 |
| Long-term liabilities: | ||
| Other liabilities | 6,420 | 6,388 |
| Deferred income taxes | 34,515 | 39,815 |
| Deferred lease credits | 38,106 | 37,479 |
| Total liabilities | 231,353 | 279,167 |
| Commitments and contingencies | ||
| Stockholders' equity: | ||
| Undesignated stock, 1,000,000 shares authorized | — | — |
| Common stock, no par value. Authorized 44,000,000 shares; issued and outstanding 18,995,188 and 18,937,131, respectively | 148,129 | 148,114 |
| Retained earnings | 456,758 | 427,695 |
| Accumulated other comprehensive loss | (2,991) | (2,096) |
| Total stockholders' equity | 601,896 | 573,713 |
| Noncontrolling interests | 508 | 586 |
| Total equity | 602,404 | 574,299 |
| Total liabilities and equity | $ 833,757 | $ 853,466 |
| BUFFALO WILD WINGS, INC. AND SUBSIDIARIES | ||
| CONSOLIDATED STATEMENTS OF CASH FLOWS | ||
| (Dollar amounts in thousands) | ||
| (unaudited) | ||
| Three months ended | ||
| March 29, | March 30, | |
| 2015 | 2014 | |
| Cash flows from operating activities: | ||
| Net earnings including noncontrolling interests | $ 28,985 | 28,316 |
| Adjustments to reconcile net earnings to net cash provided by operations: | ||
| Depreciation | 26,851 | 21,699 |
| Amortization | 1,218 | 1,133 |
| Loss on asset disposals and impairment | 605 | 787 |
| Deferred lease credits | 1,159 | 998 |
| Deferred income taxes | (5,508) | (6,892) |
| Stock-based compensation | 2,745 | 3,615 |
| Excess tax benefit from stock issuance | (66) | (29) |
| Change in operating assets and liabilities, net of effect of acquisitions: | ||
| Trading securities | (328) | (90) |
| Accounts receivable | (2,053) | (3,403) |
| Inventory | 471 | (859) |
| Prepaid expenses | (5,619) | (2,423) |
| Other assets | 154 | 121 |
| Unearned franchise fees | 362 | (126) |
| Accounts payable | (1,037) | (4,211) |
| Income taxes | 17,796 | 19,872 |
| Accrued expenses | (18,374) | (10,414) |
| Net cash provided by operating activities | 47,361 | 48,094 |
| Cash flows from investing activities: | ||
| Acquisition of property and equipment | (25,788) | (25,732) |
| Acquisition of businesses | (13,894) | — |
| Purchase of marketable securities | (12,297) | — |
| Proceeds from marketable securities | 11,155 | — |
| Net cash used in investing activities | (40,824) | (25,732) |
| Cash flows from financing activities: | ||
| Issuance of common stock | 231 | 244 |
| Excess tax benefit from stock issuance | 66 | 29 |
| Tax payments for restricted stock units | (7,627) | (7,474) |
| Net cash used in financing activities | (7,330) | (7,201) |
| Effect of exchange rate changes on cash and cash equivalents | 65 | (115) |
| Net increase (decrease) in cash and cash equivalents | (728) | 15,046 |
| Cash and cash equivalents at beginning of period | 93,329 | 57,502 |
| Cash and cash equivalents at end of period | $ 92,601 | 72,548 |
| BUFFALO WILD WINGS, INC. AND SUBSIDIARIES | ||||
| Supplemental Information | ||||
| Restaurant Count | ||||
| Company-owned Restaurants (includes Buffalo Wild Wings, Rusty Taco, and Buffalo Wild Wings-owned PizzaRev locations): | ||||
| Q1 | Q2 | Q3 | Q4 | |
| 2015 | 501 | |||
| 2014 | 443 | 449 | 463 | 491 |
| 2013 | 397 | 407 | 415 | 434 |
| 2012 | 327 | 330 | 343 | 381 |
| 2011 | 263 | 277 | 288 | 319 |
| Franchised Restaurants (includes Buffalo Wild Wings and Rusty Taco locations): | ||||
| Q1 | Q2 | Q3 | Q4 | |
| 2015 | 593 | |||
| 2014 | 569 | 579 | 588 | 591 |
| 2013 | 514 | 525 | 534 | 559 |
| 2012 | 505 | 505 | 511 | 510 |
| 2011 | 488 | 492 | 498 | 498 |
| Same-Store Sales at Buffalo Wild Wings locations in United States and Canada | |||||
| Company-owned Restaurants: | |||||
| Q1 | Q2 | Q3 | Q4 | Year | |
| 2015 | 7.0% | ||||
| 2014 | 6.6% | 7.7% | 6.0% | 5.9% | 6.5% |
| 2013 | 1.4% | 3.8% | 4.8% | 5.2% | 3.9% |
| 2012 | 9.2% | 5.3% | 6.2% | 5.8% | 6.6% |
| 2011 | 3.9% | 5.9% | 5.7% | 8.9% | 6.1% |
| Franchised Restaurants: | |||||
| Q1 | Q2 | Q3 | Q4 | Year | |
| 2015 | 6.0% | ||||
| 2014 | 5.0% | 6.5% | 5.7% | 5.1% | 5.6% |
| 2013 | 2.2% | 4.1% | 3.9% | 3.1% | 3.3% |
| 2012 | 7.3% | 5.5% | 5.8% | 7.4% | 6.5% |
| 2011 | 1.6% | 2.7% | 4.2% | 5.9% | 3.6% |
| BUFFALO WILD WINGS, INC. AND SUBSIDIARIES | |||||
| Supplemental Information | |||||
| Average Weekly Sales Volumes at Buffalo Wild Wings locations in United States and Canada | |||||
| Company-owned Restaurants: | |||||
| Q1 | Q2 | Q3 | Q4 | Year | |
| 2015 | $ 64,851 | ||||
| 2014 | 60,966 | 59,403 | 59,643 | 62,119 | 60,470 |
| 2013 | 56,953 | 54,759 | 55,592 | 58,204 | 56,392 |
| 2012 | 55,131 | 51,524 | 52,561 | 55,595 | 53,783 |
| 2011 | 48,845 | 47,970 | 49,461 | 51,983 | 49,627 |
| Franchised Restaurants: | |||||
| Q1 | Q2 | Q3 | Q4 | Year | |
| 2015 | $ 67,075 | ||||
| 2014 | 63,852 | 61,845 | 61,586 | 63,949 | 62,595 |
| 2013 | 60,050 | 58,186 | 58,926 | 61,167 | 59,594 |
| 2012 | 57,282 | 54,766 | 55,608 | 58,490 | 56,570 |
| 2011 | 52,744 | 50,995 | 51,350 | 53,385 | 52,081 |