000214 Nathan's Reports Third Quarter ResultFebruary 12, 2000Westbury, NY - Nathan's Famous, Inc. reported results for the third quarter ending December 26, 1999. Total revenues were $28,341,000 for the thirty-nine weeks ended December 26, 1999 as compared to $23,202,000 for the thirty-nine weeks ended December 27, 1998. Results for the thirty-nine weeks ended December 26, 1999 have been consolidated with Miami Subs since October 1, 1999. Systemwide sales of the Nathan's brand, including supermarket sales by the Company's licensee, were $97,126,000 for the fiscal 2000 period, as compared to $92,801,000 for the fiscal 1999 period. Earnings before income taxes for the thirty-nine weeks ended December 26, 1999 were $1,491,000 as compared to $2,299,000 for the thirty-nine weeks ended December 27, 1998. Net earnings for the fiscal 2000 period were $858,000, or $0.16 per diluted share, as compared to $1,737,000, or $0.37 per diluted share, in the fiscal 1999 period. Results for the fiscal 1999 period included an income tax benefit of $426,000, or $0.09 per share, from the reduction of the Company's deferred tax valuation allowance. Net earnings for the fiscal 1999 period, exclusive of the income tax benefit, would have been $1,311,000, or $0.28 per share. During the third quarter fiscal 2000, the Company incurred an impairment charge on notes receivable of $566,000, an expense of $222,000 from its equity in the loss of Miami Subs prior to acquisition and bad debts and prepayment incentives on notes receivable of $233,000. Results for the fiscal 1999 period included sales and pretax profits of $947,000 and $187,000, respectively, from two Company-owned Nathan's restaurants that closed during the last fiscal year due to lease expirations. Total revenues for the thirteen weeks ended December 26, 1999 were $12,048,000 as compared to $7,215,000 for the thirteen weeks ended December 27, 1998. Loss before income taxes for the quarter ended December 26, 1999 was $325,000 as compared to earnings before income taxes of $548,000 for the quarter ended December 27, 1998. Net loss for the third quarter fiscal 2000 was $227,000, or $0.03 per diluted share, as compared to net earnings of $412,000, or $0.09 per diluted share, in the third quarter fiscal 1999. Results for the third quarter fiscal 1999 included an income tax benefit of $115,000, or $0.02 per share, from the reduction of the company's deferred tax valuation allowance. Net earnings for the third quarter fiscal 1999, exclusive of the income tax benefit, would have been $297,000 or $0.07 per share. Wayne Norbitz, President and Chief Operating Officer said, “This has been a very exciting year for Nathan's. On April 1, 1999, we became the new franchisor of the Kenny Rogers Roasters restaurant system by acquiring the intellectual property of Roasters Corp. and Roasters Franchise Corp. and on September 30, 1999, we completed our merger with Miami Subs Corporation.” Mr. Norbitz continued, “Since consummating the merger with Miami Subs we have developed initial strategic plans to improve the performance of the combined restaurant system and have begun capitalizing on the economies of scale of a company which is now larger in size. In addition, we have begun to introduce co-branding activities among our various branded concepts and have repaid approximately $1,836,000 of existing debt.” Mr. Norbitz concluded, “As a result of our acquisitions of Miami Subs and Kenny Rogers Roasters, our Company today consists of 33 Company-owned units, 425 franchised or licensed units and more than 950 Branded Product points of distribution that feature Nathan's world famous all-beef hot dogs, located in forty-four states, the District of Columbia and seventeen foreign countries.”
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