<PAGE> 1
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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(MARK ONE)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED JUNE 29, 1997
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM --------------- TO ---------------
COMMISSION FILE NUMBER 00028230
PLANET HOLLYWOOD INTERNATIONAL, INC.
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C>
DELAWARE 59-3283783
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
</TABLE>
7380 SAND LAKE ROAD
SUITE 600
ORLANDO, FLORIDA 32819
(Address of principal executive office, including zip code)
(407) 363-7827
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes X No
---- ----
As of August 8, 1997, there were 97,019,563 shares of the registrant's
Class A Common Stock outstanding and 11,764,144 shares of the registrant's Class
B Common Stock outstanding.
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<PAGE> 2
PLANET HOLLYWOOD INTERNATIONAL, INC.
INDEX
<TABLE>
<S> <C> <C> <C>
PART I FINANCIAL INFORMATION
Item 1 -- Financial Statements.................................................... 3
Condensed Consolidated Balance Sheets -- June 29, 1997 and December 29,
1996.................................................................... 3
Condensed Consolidated Statements of Operations -- Thirteen Weeks and
Twenty-Six Weeks ended June 29, 1997 and June 30, 1996.................. 4
Condensed Consolidated Statements of Cash Flows -- Twenty-six Weeks
ended June 29, 1997 and June 30, 1996................................... 5
Notes to Condensed Consolidated Financial Statements.................... 6
Item 2 -- Management's Discussion and Analysis of Financial Condition and Results
of Operations........................................................... 7
PART II OTHER INFORMATION
Item 4 -- Submission of Matters to a Vote of Security Holders..................... 11
Item 6 -- Exhibits and Reports on Form 8-K........................................ 11
SIGNATURES.............................................................................. 12
INDEX TO EXHIBITS....................................................................... 13
</TABLE>
2
<PAGE> 3
PART I -- FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
PLANET HOLLYWOOD INTERNATIONAL, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)
STATED IN THOUSANDS OF U.S. DOLLARS
<TABLE>
<CAPTION>
JUNE 29, DECEMBER 29,
1997 1996
-------- ------------
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents.......................................... $ 40,416 $ 49,831
Accounts receivable................................................ 28,891 22,697
Inventories........................................................ 22,392 20,604
Prepaid expenses................................................... 7,927 5,479
Other current assets............................................... 14,135 15,262
-------- ----------
Total current assets....................................... 113,761 113,873
Property and equipment, net.......................................... 294,415 250,108
Goodwill............................................................. 30,618 25,779
Investment in affiliated entities.................................... 22,611 10,013
Other assets, net.................................................... 2,057 1,487
-------- ----------
$463,462 $401,260
======== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued liabilities........................... $ 41,083 $ 52,576
Notes payable -- current........................................... 635 746
-------- ----------
Total current liabilities.................................. 41,718 53,322
Deferred rentals..................................................... 10,563 10,329
Deferred taxes....................................................... 3,284 849
Notes payable and other.............................................. 27,186 7,529
Deferred credits..................................................... 21,600 17,100
-------- ----------
Total liabilities.......................................... 104,351 89,129
Stockholders' equity:
Common stock -- Class A............................................ 971 960
Common stock -- Class B............................................ 115 115
Capital in excess of par value..................................... 273,263 252,695
Deferred compensation.............................................. (425) (525)
Retained earnings.................................................. 85,208 58,386
Cumulative currency translation adjustment......................... (21) 500
-------- ----------
Total stockholders' equity................................. 359,111 312,131
-------- ----------
$463,462 $401,260
======== ==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
3
<PAGE> 4
PLANET HOLLYWOOD INTERNATIONAL, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
STATED IN THOUSANDS OF U.S. DOLLARS, EXCEPT PER SHARE AMOUNTS
<TABLE>
<CAPTION>
TWENTY-SIX WEEKS
THIRTEEN WEEKS ENDED ENDED
--------------------- ---------------------
JUNE 29, JUNE 30, JUNE 29, JUNE 30,
1997 1996 1997 1996
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Revenues........................................ $121,892 $ 85,366 $223,539 $162,391
Costs and expenses:
Cost of sales................................. 31,892 21,907 58,578 42,613
Operating expenses............................ 51,987 34,680 99,033 69,848
General and administrative expenses........... 6,387 4,336 12,661 9,291
Depreciation and amortization................. 8,476 7,021 16,822 13,895
-------- -------- -------- --------
98,742 67,944 187,094 135,647
Income from operations.......................... 23,150 17,422 36,445 26,744
Non-operating expense (income):
Interest, net................................. (559) 260 (1,021) 4,290
Equity in income of unconsolidated
affiliates................................. (2,350) (657) (5,450) (1,405)
Minority interests............................ -- 272 -- 1,037
-------- -------- -------- --------
Income before income taxes...................... 26,059 17,547 42,916 22,822
Provision for income taxes...................... 9,772 6,405 16,094 8,330
-------- -------- -------- --------
Income before extraordinary item................ 16,287 11,142 26,822 14,492
Extraordinary item, net......................... -- (10,421) -- (10,421)
-------- -------- -------- --------
Net income...................................... $ 16,287 $ 721 $ 26,822 $ 4,071
======== ======== ======== ========
Earnings per share:
Income before extraordinary item.............. $ 0.15 $ 0.11 $ 0.24 $ 0.15
======== ======== ======== ========
Net income.................................... $ 0.15 $ 0.01 $ 0.24 $ 0.04
======== ======== ======== ========
Weighted average shares outstanding............. 110,729 105,258 110,109 96,034
======== ======== ======== ========
Supplemental pro forma earnings per share(A):
Earnings per share before extraordinary
item....................................... $ 0.11 $ 0.17
======== ========
Earnings per share -- net income.............. $ 0.01 $ 0.07
======== ========
Weighted average shares outstanding........... 107,239 101,532
======== ========
</TABLE>
- ---------------
(A) Supplemental pro forma earnings per share gives effect to the prepayment of
certain indebtedness by application of a portion of the net proceeds from
the Initial Public Offering, as if the prepayment had occurred at the
beginning of the fiscal year.
The accompanying notes are an integral part of these financial statements.
4
<PAGE> 5
PLANET HOLLYWOOD INTERNATIONAL, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
STATED IN THOUSANDS OF U.S. DOLLARS
<TABLE>
<CAPTION>
TWENTY-SIX WEEKS
ENDED
---------------------
JUNE 29, JUNE 30,
1997 1996
-------- --------
<S> <C> <C>
NET CASH PROVIDED BY OPERATING ACTIVITIES............................ $ 24,391 $ 30,927
Cash flows from investing activities:
Additions to property and equipment................................ (58,184) (39,081)
Investment in affiliate............................................ (6,378) --
Purchase of restaurant from franchisee............................. (8,011) --
Other.............................................................. (346) (321)
-------- --------
NET CASH USED IN INVESTING ACTIVITIES................................ (72,919) (39,402)
-------- --------
Cash flows from financing activities:
Change in restricted cash and investments.......................... -- 69
Distributions to minority interests................................ -- (271)
Proceeds from issuance of common stock............................. 19,566 196,581
Proceeds from issuance of notes payable............................ 20,000 --
Repayment of shareholder notes payable............................. -- (70,750)
IPO costs and financing costs capitalized.......................... -- (3,670)
Deferred financing costs........................................... -- (162)
Repayment of notes payable......................................... (453) (65,355)
-------- --------
NET CASH PROVIDED BY FINANCING ACTIVITIES............................ 39,113 56,442
-------- --------
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS................. (9,415) 47,967
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD..................... 49,831 14,923
-------- --------
CASH AND CASH EQUIVALENTS AT END OF PERIOD........................... $ 40,416 $ 62,890
======== ========
</TABLE>
The accompanying notes are an integral part of these financial statements.
5
<PAGE> 6
PLANET HOLLYWOOD INTERNATIONAL, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
1. BASIS OF PRESENTATION
The accompanying unaudited condensed consolidated financial statements of
Planet Hollywood International, Inc. have been prepared by the Company pursuant
to the rules and regulations of the Securities and Exchange Commission.
The information furnished herein reflects all adjustments (consisting of
only normal recurring accruals and adjustments) which are, in the opinion of
management, necessary to fairly state the operating results for the respective
periods. Certain information and footnote disclosures normally included in
annual financial statements prepared in accordance with generally accepted
accounting principles have been omitted pursuant to such rules and regulations.
The notes to the condensed consolidated financial statements should be read in
conjunction with the notes to the consolidated financial statements contained in
the Company's Form 10-K for the fiscal year ended December 29, 1996. Company
management believes that the disclosures are sufficient for interim financial
reporting purposes.
2. STOCK OFFERING
In April 1996, the Company completed an initial public offering of
12,406,452 shares of common stock at an offering price of $18.00 per share,
including 1,618,233 shares from the exercise of the Underwriters' over allotment
option. The Company received net proceeds of approximately $196.6 million after
the payment of approximately $12.5 million in related underwriting discount and
offering costs.
3. EARNINGS PER SHARE
Earnings per share is based on the weighted average number of shares
outstanding during the period increased by common equivalent shares (stock
options) determined using the treasury stock method.
Supplemental pro forma earnings per share gives effect to the repayment of
certain indebtedness by application of a portion of the net proceeds from the
initial public offering, as if the prepayment had occurred at the beginning of
the 1996 fiscal year.
4. NEW ACCOUNTING PRONOUNCEMENT
In February 1997, the FASB issued SFAS No. 128, Earnings per Share, which
is effective for periods ending after December 15, 1997. SFAS No. 128
establishes standards for computing and presenting earnings per share ("EPS").
It simplifies the standards for computing EPS and replaces the presentation of
primary EPS with a presentation of basic EPS. Basic EPS excludes dilution and is
computed by dividing income available to common stockholders by the
weighted-average number of common shares outstanding for the period. Diluted EPS
reflects the potential dilution that could occur if securities or other
contracts to issue common stock were exercised or converted into common stock.
SFAS No. 128 also requires dual presentation of basic EPS and diluted EPS on the
face of the income statement for all entities with complex capital structures.
The Company plans to adopt SFAS No. 128 for the year ended December 28, 1997 and
does not expect a material impact on the Company's EPS.
6
<PAGE> 7
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
All statements contained herein that are not historical facts, including,
but not limited to, statements regarding the Company's current business
strategy, the Company's projected sources and uses of cash, and the Company's
plans for future development and operations, are based upon current
expectations. Such statements are forward-looking in nature and involve a number
of risks and uncertainties. Consequently, actual results may differ materially
from the forward-looking statements. Among the factors that could cause actual
results to differ materially are the following: the availability of sufficient
capital to finance the Company's business plans on terms satisfactory to the
Company; the impact of competitive products and pricing; changes in labor,
equipment, food and capital costs; changes in, or the failure to comply with,
regulations affecting the Company's business; future acquisitions or strategic
partnerships; the availability, locations and terms of sites for development;
the timing and costs associated with new location openings; acceptance of new
guests of the Company's brands and concepts as the Company continues to expand
into new brands and/or regions; success of the Company's franchisees and
licensees and the manner in which they promote, operate and develop the
Company's brands; general business and economic conditions; and factors
described from time to time in the Company's reports filed with the Securities
and Exchange Commission. The Company cautions readers not to place undue
reliance on any such forward-looking statements, which statements are made
pursuant to the safe harbor provisions of the Private Litigation Reform Act of
1995.
RESULTS OF OPERATIONS
The thirteen weeks ended June 29, 1997 compared to the thirteen weeks ended
June 30, 1996
Revenues. Total revenues increased to $121.9 million for the thirteen
weeks ended June 29, 1997 from $85.4 million for the thirteen weeks ended June
30, 1996, an increase of $36.5 million or 43%. The increase in revenues is due
to the Company's continued expansion through the opening of new restaurants,
retailing, franchising and the sale and promotion of the Company's brands and
products through strategic alliances and associations.
Direct revenues increased 44% from $82.1 million for the thirteen weeks
ended June 30, 1996 to $118.0 million for the thirteen weeks ended June 29,
1997, due primarily to the opening of 17 Company-owned units after the second
quarter of fiscal 1996 (including the acquisition of two franchised units), with
5 units opening in the thirteen weeks ended June 29, 1997, and the sale of
branded products. Direct revenues on a same unit basis decreased 2% from $73.1
million for the thirteen weeks ended June 30, 1996 to $71.7 million for the
thirteen weeks ended June 29, 1997. The Company operates in an increasingly
competitive environment with numerous themed restaurants entering many of the
Company's existing markets. Additionally, the Company continues to expand into
smaller markets which could adversely impact revenues of existing units. As a
percentage of direct revenues, merchandise sales for the Company increased from
37.4% for the thirteen weeks ended June 30, 1996 to 37.7% for the thirteen weeks
ended June 29, 1997. The increase in merchandise sales mix is due to the
introduction of new product lines and the continued development of the retail
distribution system. Franchise fees were $2.0 million for the thirteen weeks
ended June 30, 1996 and June 29, 1997. Royalties increased from $1.3 million for
the thirteen weeks ended June 30, 1996 to $1.9 million for the thirteen weeks
ended June 29, 1997, due primarily to the opening of 18 franchised Planet
Hollywood and Official All Star Cafe units after the second quarter of fiscal
1996.
Costs and expenses. Food and beverage costs decreased from 22.5% of food
and beverage revenues for the thirteen weeks ended June 30, 1996 to 22.3% for
the thirteen weeks ended June 29, 1997. Merchandise costs increased from 33.8%
of merchandise revenues for the thirteen weeks ended June 30, 1996 to 34.8% for
the thirteen weeks ended June 29, 1997, primarily due to the introduction of new
products. Operating expenses, which consist primarily of labor, occupancy and
other direct unit operating costs, increased from 42.2% of direct revenues for
the thirteen weeks ended June 30, 1996 to 44.1% for the thirteen weeks ended
June 29, 1997. The increase in operating expenses is primarily due to the
opening of Company-owned units in Europe, which generally have higher operating
costs, and increased labor and benefits costs within the United States.
7
<PAGE> 8
General and administrative expenses increased from $4.3 million for the
thirteen weeks ended June 30, 1996 to $6.4 million for the thirteen weeks ended
June 29, 1997, due primarily to the continued expansion of the Corporate
infrastructure to support the Company's existing and emerging concepts. As a
percent of total revenues, general and administrative expenses increased from
5.1% for the thirteen weeks ended June 30, 1996 to 5.3% for the thirteen weeks
ended June 29, 1997. Depreciation and amortization increased 21% from $7.0
million for the thirteen weeks ended June 30, 1996 to $8.5 million for the
thirteen weeks ended June 29, 1997, due primarily to the increased number of
units in operation during the second quarter of fiscal 1997. As a percent of
total revenues, depreciation and amortization costs were 8.2% for the thirteen
weeks ended June 30, 1996 and 7.0% for the thirteen weeks ended June 29, 1997.
The decrease in depreciation and amortization is due to the continued growth of
the Company, which has resulted in the depreciation and amortization costs being
absorbed over a larger revenue base.
Interest, net. The Company realized net interest income of $0.6 million
for the thirteen weeks ended June 29, 1997 compared to net interest expense of
$0.3 million for the thirteen weeks ended June 30, 1996. Company debt was repaid
with the proceeds from the initial public offering in the second quarter of
fiscal 1996.
Equity in Income of Unconsolidated Affiliates. Equity in income of
unconsolidated affiliates increased from $0.7 million for the thirteen weeks
ended June 30, 1996 to $2.4 million for the thirteen weeks ended June 29, 1997,
which was primarily attributable to new units and franchise openings by ECE and
PH Asia since the second quarter of 1996.
Other. Minority interests decreased from $0.3 million for the thirteen
weeks ended June 30, 1996 to zero for the thirteen weeks ended June 29, 1997,
due to the Company's acquisitions of all minority interests in the second
quarter of 1996.
Provision for Income Taxes. The provision for income taxes was $6.4
million or 36.5% of pretax income for the thirteen weeks ended June 30, 1996.
For the thirteen weeks ended June 29, 1997, the Company recorded a provision for
income taxes of $9.8 million or 37.5% of pretax income.
Extraordinary item, net. The Company incurred an extraordinary charge in
the second quarter of 1996 of $10.4 million, net of $5.9 million in taxes, as a
result of the early extinguishment of long-term notes payable.
The twenty-six weeks ended June 29, 1997 compared to the twenty-six weeks
ended June 30, 1996
Revenues. Total revenues increased 38% from $162.4 million for the
twenty-six weeks ended June 30, 1996 to $223.5 million for the twenty-six weeks
ended June 29, 1997. The increase in revenues is due to the Company's continued
expansion through the opening of new restaurants, retailing, franchising and the
sale and promotion of the Company's brands through strategic alliances and
associations.
Direct revenues increased 38% from $157.3 million for the twenty-six weeks
ended June 30, 1996 to $216.6 million for the twenty-six weeks ended June 29,
1997, due primarily to the opening of 17 Company-owned units after the second
quarter of fiscal 1996 and the sale of branded products. Direct revenues on a
same unit basis (22 units) decreased 2.0% from $136.9 million for the twenty-six
weeks ended June 30, 1996 to $134.1 million for the twenty-six weeks ended June
29, 1997. The Company operates in an increasingly competitive environment with
numerous themed restaurants entering many of the Company's existing markets.
Additionally, the Company continues to expand into smaller markets which could
adversely impact revenues of existing units. As a percentage of direct revenues,
merchandise sales for the Company increased from 36.9% for the twenty-six weeks
ended June 30, 1996 to 37.6% for the twenty-six weeks ended June 29, 1997. The
increase in merchandise sales is due to the introduction of new product lines
and the transition of prior-season items. Franchise fees were $3.5 million for
the twenty-six weeks ended June 29, 1997, as compared to $3.0 million for the
twenty-six weeks ended June 30, 1996. Royalties increased from $2.1 million for
the twenty-six weeks ended June 30, 1996 to $3.5 million for the twenty-six
weeks ended June 29, 1997, due primarily to the opening of 18 franchised Planet
Hollywood and Official All Star Cafe units after the second quarter of fiscal
1996.
Costs and expenses. Food and beverage costs decreased from 22.7% of food
and beverage revenues for the twenty-six weeks ended June 30, 1996 to 22.5% for
the twenty-six weeks ended June 29, 1997.
8
<PAGE> 9
Merchandise costs for the twenty-six weeks ended June 30, 1996 and June 29, 1997
remained constant at 34.6% of merchandise revenues. Operating expenses, which
consist primarily of labor, occupancy and other direct unit operating costs,
increased from 44.4% of direct revenues for the twenty-six weeks ended June 30,
1996 to 45.7% for the twenty-six weeks ended June 29, 1997, primarily due to the
effect of the opening of Company-owned units in Europe, which generally have
higher operating costs, and increased labor and benefits costs within the United
States.
General and administrative expenses increased from $9.3 million for the
twenty-six weeks ended June 30, 1996 to $12.7 million for the twenty-six weeks
ended June 29, 1997, due primarily to the expansion of the Corporate
infrastructure to support the Company's existing and emerging concepts. As a
percent of total revenues, general and administrative expenses remained constant
at 5.7% for the twenty-six weeks ended June 30, 1996 and June 29, 1997.
Depreciation and amortization increased 21.0% from $13.9 million for the
twenty-six weeks ended June 30, 1996 to $16.8 million for the twenty-six weeks
ended June 29, 1997, due primarily to the larger number of units in operation
during the twenty-six weeks ended June 29, 1997. As a percent of total revenues,
depreciation and amortization costs decreased from 8.6% for the twenty-six weeks
ended June 30, 1996 to 7.5% for the twenty-six weeks ended June 29, 1997. The
decrease in depreciation and amortization is due to the continued growth of the
Company, which has resulted in the depreciation and amortization costs being
absorbed over a larger revenue base.
Interest, net. The Company realized net interest income of $1.0 million
for the twenty-six weeks ended June 29, 1997 compared to net interest expense of
$1.3 million for the twenty-six weeks ended June 30, 1996. Company debt was
repaid with the proceeds from the annual public offering in the second quarter
of 1996.
Equity in Income of Unconsolidated Affiliates. Equity in income of
unconsolidated affiliates increased from $1.4 million for the twenty-six weeks
ended June 30, 1996 to $5.5 million for the twenty-six weeks ended June 29,
1997, which was primarily attributable to new units and franchise openings by
ECE and PH Asia since the first half of fiscal 1996.
Other. Minority interests decreased from $1.0 million for the twenty-six
weeks ended June 30, 1996 to zero for the twenty-six weeks ended June 29, 1997,
due to the acquisition by the Company of all minority interests in the second
quarter of 1996.
Provision for Income Taxes. For the twenty-six weeks ended June 30, 1996,
the provision for income taxes was $8.3 million or 36.5% of pretaxable income.
The provision for income taxes was $16.1 million or 37.5% of pretaxable income
for the twenty-six weeks ended June 29, 1997.
Extraordinary item, net. The Company incurred an extraordinary charge in
the second quarter of 1996 of $10.4 million, net of $5.9 million in taxes, as a
result of the early extinguishment of long-term notes payable.
LIQUIDITY AND CAPITAL RESOURCES
Net cash used in investing activities for the twenty-six weeks ended June
30, 1996 and June 29, 1997 was $39.4 million and $72.9 million, respectively.
Most of the increase was due to capital expenditures, primarily new site costs
and construction costs for the Company's corporate headquarters, increasing from
$39.1 million for the twenty-six weeks ended June 30, 1996 to $58.2 million for
the twenty-six weeks ended June 29, 1997. Additionally, the Company purchased a
domestic franchise unit and increased its investment in ECE during the first
quarter of fiscal 1997.
Net cash provided by financing activities for the twenty-six weeks ended
June 30, 1996 and June 29, 1997 was $56.4 million and $39.1 million,
respectively. During the thirteen weeks ended June 29, 1997, the Company
received proceeds of approximately $20 million from the issuance of stock to an
investor and franchisee. Additionally, the Company received proceeds of $20
million from a construction loan with a financial institution.
Net cash provided by operating activities for the twenty-six weeks ended
June 30, 1996 and June 29, 1997 was $30.9 million and $24.4 million,
respectively. While operating revenues have increased, cash provided from
9
<PAGE> 10
operations has decreased due primarily to a decrease in payables, an increase in
receivables, and an increase in equity in income of unconsolidated affiliates.
In March 1997, the Company entered into a franchise agreement which
provides for the development of up to 34 Planet Hollywood restaurant-merchandise
units in 23 countries throughout the Middle East and Europe. The franchise
agreement provided for and the investor made a payment to the Company of $8.0
million for six sites in the thirteen weeks ended June 29, 1997. Additional
franchise fees will be payable under the terms of the franchise agreement. In
conjunction with the agreement, the investor purchased 1% of the Company's total
common stock outstanding directly from the Company for approximately $20
million. These funds were received in the second quarter of 1997.
In July 1997, the Company entered into a joint venture with AMC
Entertainment, Inc. ("AMC") to develop, own and operate "Planet Movies By AMC",
an integrated moviegoing dining and retail concept worldwide. The Company
expects to fund $15 million to the joint venture by the end of fiscal 1997 for
the purposes of developing and operating "Planet Movies By AMC" complexes
throughout the world.
Under the Company's credit agreement with certain banks (the "Credit
Agreement"), the Company has a two-year unsecured $50.0 million revolving credit
line which expires in April 1998. The Company is currently in the process of
renewing and potentially increasing the Credit Agreement and hopes to have such
renewal completed by the end of fiscal 1997. The Company expects that cash on
hand, cash from financing activities, cash generated from operations and funds
available under the Credit Agreement will be sufficient to meet its capital
requirements.
10
<PAGE> 11
PART II -- OTHER INFORMATION
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
The Company held its Annual Meeting of Stockholders on May 16, 1997 in
Orlando, Florida. At this meeting, Thomas Avallone, Mark McCormack, and Isadore
Sharp were re-elected as directors of the Company to serve a three-year term or
until their successors are duly elected and qualified. In addition, an amendment
to the First Amended and Restated Planet Hollywood International, Inc. 1995
Stock Award and Incentive Plan (the "Plan") was adopted to increase the number
of shares of Class A Common Stock reserved for issuance under the Plan to
6,000,000. The Planet Hollywood International, Inc. Employee Stock Purchase Plan
was also approved by the Stockholders. The voting on such items was as follows:
(1) Election of directors:
<TABLE>
<CAPTION>
AGAINST OR
WITHHOLD
FOR AUTHORITY
---------- -----------
<S> <C> <C>
Thomas Avallone..................................... 77,935,587 43,981
Mark McCormack...................................... 77,938,973 40,595
Isadore Sharp....................................... 77,938,230 41,338
</TABLE>
(2) Amendment to the First Amended and Restated Planet Hollywood International,
Inc. 1995 Stock Award and Incentive Plan:
<TABLE>
<CAPTION>
FOR AGAINST ABSTAIN
- ---------- ------- -------
<S> <C> <C>
77,228,786 550,359 200,423
</TABLE>
(3) Approval of the Planet Hollywood International, Inc. Employee Stock Purchase
Plan:
<TABLE>
<CAPTION>
FOR AGAINST ABSTAIN
- ---------- ------- -------
<S> <C> <C>
77,685,286 103,101 191,181
</TABLE>
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
a. Exhibits
See Index to Exhibits on page 13
b. Reports on Form 8-K
On April 29, 1997, the Company filed a report on Form 8-K relating to
the Company entering into a Stock Subscription Agreement whereby 1,087,000
shares of the Company's Class A Common Stock were subscribed for and
purchased for $18.00 per share.
11
<PAGE> 12
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
PLANET HOLLYWOOD INTERNATIONAL, INC.
DATE: August 12, 1997 By: /s/ ROBERT EARL
------------------------------------
Name: Robert Earl
Its: President and Chief
Executive Officer
DATE: August 12, 1997 By: /s/ THOMAS AVALLONE
------------------------------------
Name: Thomas Avallone
Its: Chief Financial Officer
12
<PAGE> 13
INDEX TO EXHIBITS
Exhibit 11 -- Statement regarding computation of per share earnings (Unaudited)
Exhibit 27 -- Financial Data Schedule (for SEC use only)
13
<PAGE> 1
Exhibit 11
Planet Hollywood International, Inc.
Statement regarding computation of per share earnings (Unaudited)
Stated in thousands of U.S. Dollars, except per share amounts
<TABLE>
<CAPTION>
Thirteen Weeks Ended Twenty-Six Weeks Ended
---------------------- -----------------------
6/29/97 6/30/96 6/29/97 6/30/96
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
PRIMARY:
Net earnings available in common shareholders $ 16,287 $ 721 $ 26,822 $ 4,071
========= ========= ========= =========
Weighted average shares outstanding:
Common shares outstanding at end of period 108,784 107,518 108,784 107,518
Common equivalent shares outstanding at end
of period 2,235 2,821 2,070 2,821
--------- --------- --------- ---------
Total common and equivalent common shares
outstanding at end of period 111,019 110,339 110,854 110,339
Effects of using weighted average common and
common equivalent shares outstanding (290) (5,081) (745) $ (14,305)
--------- --------- --------- ---------
Shares used in computing earnings per share $ 110,729 $ 105,258 $ 110,109 $ 96,034
========= ========= ========= =========
Net Earnings per common and common
equivalent share, primary $ 0.15 $ 0.01 $ 0.24 $ 0.04
========= ========= ========= =========
FULLY DILUTED:
Net earnings available in common shareholders $ 16,287 $ 721 $ 26,822 $ 4,071
========= ========= ========= =========
Weighted average shares outstanding:
Common shares outstanding at end of period 108,784 107,518 108,784 107,518
Common equivalent shares outstanding at end
of period 3,066 2,821 3,066 2,821
--------- --------- --------- ---------
Total common and equivalent common shares
outstanding at end of period 111,850 110,339 111,850 110,339
Effects of using weighted average common and
common equivalent shares outstanding (290) (5,081) (1,243) (14,305)
--------- --------- --------- ---------
Shares used in computing earnings per share $ 111,560 $ 105,258 $ 110,607 $ 96,034
========= ========= ========= =========
Net Earnings per common and common
equivalent share, fully diluted $ 0.15 $ 0.01 $ 0.24 $ 0.04
========= ========= ========= =========
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
FINANCIAL STATEMENTS OF PLANET HOLLYWOOD INTERNATIONAL, INC. FOR THE
TWENTY-SIX WEEKS ENDED JUNE 29, 1997, AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-28-1997
<PERIOD-START> DEC-30-1996
<PERIOD-END> JUN-29-1997
<CASH> 40,416
<SECURITIES> 0
<RECEIVABLES> 28,891
<ALLOWANCES> 0
<INVENTORY> 22,392
<CURRENT-ASSETS> 113,761
<PP&E> 326,036
<DEPRECIATION> 31,621
<TOTAL-ASSETS> 463,462
<CURRENT-LIABILITIES> 41,718
<BONDS> 0
0
0
<COMMON> 1,086
<OTHER-SE> 358,025
<TOTAL-LIABILITY-AND-EQUITY> 463,462
<SALES> 216,583
<TOTAL-REVENUES> 223,539
<CGS> 58,578
<TOTAL-COSTS> 187,094
<OTHER-EXPENSES> (5,450)
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> (1,021)
<INCOME-PRETAX> 42,916
<INCOME-TAX> 16,094
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 26,822
<EPS-PRIMARY> 0.24
<EPS-DILUTED> 0.24
</TABLE>
