Granite City Food & Brewery Reports Third Quarter 2009 Results

Granite City Food & Brewery Ltd. (Nasdaq:GCFB), a Modern American upscale casual restaurant chain, today reported results for the third quarter ended September 29, 2009.

Highlights for the third quarter of 2009 were as follows:

• Corporate charges decreased $1.3 million in third quarter 2009 compared to third quarter 2008

• Prime cost (food, beverage, labor) as a percentage of revenue decreased 2.4 percentage points from 65.5% in prior year third quarter to 63.1% in third quarter 2009

• Restaurant-level Income Before Occupancy ('IBO') improved to 21.7% from 19.5% in prior year third quarter

• Restaurant-level IBO for comp stores increased to 22.2% from 20.9% in prior year third quarter

• Comparable restaurant sales down 12.7% on an adjusted 13-week quarter-over-quarter comparison

• Adjusted company-wide EBITDA improved by $0.9 million from $0.7 million in third quarter 2008 to $1.6 million in third quarter 2009 and improved by $3.6 million from $0.3 million in the first three quarters of 2008 to $3.9 million in the first three quarters of 2009

Third Quarter 2009 Financial Results

For all the restaurants, the restaurant-level IBO margin was 21.7% for the third quarter of 2009 compared to 19.5% in the third quarter of 2008. This represents an increase of 2.2 percentage points in restaurant-level IBO.

'We are pleased to have finalized the DHW transaction which now allows us to turn our full attention to operations,' commented Granite City's CEO, Steve Wagenheim. 'The benefits of that transaction to the income statement and balance sheet will become more apparent as we move through the 4th quarter. Our focus in operations during the past quarter was to drive traffic back into the stores. We concentrated on two areas; the lowering of our lunch time average check and heavy discounting through strategic time periods. While the lowering of our overall average check hurt our revenue, we are pleased to see that in September our guest counts stabilized on a year over year basis, and in October we showed positive comps. We feel this trend will allow us to pull back on our discounting as we move into the all important holiday season.'

Total revenue for the third quarter 2009 decreased by 15.7% to $21.5 million compared to $25.5 million for the third quarter of 2008. The third quarter of 2008 included 14 weeks while the third quarter of 2009 included only 13 weeks. On an adjusted 13-week basis, revenues decreased 9.2%.

Total cost of sales was $18.5 million in the third quarter or 86.1% of sales compared to prior year third quarter cost of sales of $22.0 million or 86.3% of sales. This improvement was due to several factors including our renegotiated food and food distribution costs, sizing and scheduling our staff to standardized sales-per-labor-hour levels, and a continued strong focus in managing strategy.

General and administrative expenses were $1.4 million or 6.5% of sales for the third quarter of 2009 compared to $2.7 million or 10.7% of sales for the third quarter of 2008. The company capitalized previously recorded restructuring costs which resulted in a benefit to general and administrative expenses of approximately $400,000 in the third quarter of 2009.

The net loss for the third quarter of 2009 was $1.7 million or $(0.11) per share compared to a net loss of $4.3 million or $(0.26) per share in the third quarter of 2008.

Year-to-Date Financial Results

Total revenue for the first three quarters of 2009 decreased by 12.9% to $65.0 million compared to $74.6 million for the first three quarters of 2008. The first three quarters of 2008 included 40 weeks while the first three quarters of 2009 included only 39 weeks. On an adjusted 39-week basis, revenue decreased 10.6%.

For all the restaurants, the restaurant-level IBO margin was 21.7% for the first three quarters of 2009 compared to 19.5% in first three quarters of 2008. This represents an increase of 2.2 percentage points in restaurant-level IBO.

Total cost of sales was $55.1 million in the first three quarters or 84.8% of sales compared to prior year first three quarters cost of sales of $66.0 million or 88.5% of sales.

General and administrative expenses were $5.9 million or 9.1% of sales for the first three quarters of 2009 compared to $8.2 million or 11.0% of sales for the first three quarters of 2008.

The net loss for the first three quarters of 2009 was $7.0 million or $(0.43) per share compared to a net loss of $11.8 million or $(0.73) per share in the first three quarters of 2008.

Logos, product and company names mentioned are the property of their respective owners.

Reader Comments:

Be the first to leave a comment for this article

Tweet