<PAGE> 1
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(Mark One)
X QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
- ---- EXCHANGE ACT OF 1934
For quarterly period ended September 28, 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 1-8766
-----------------------------
J. ALEXANDER'S CORPORATION
---------------------------
(Exact name of Registrant as specified in its charter)
<TABLE>
<CAPTION>
Tennessee 62-0854056
--------- ----------
<S> <C>
(State or other jurisdiction of incorporation (I.R.S. Employer Identification No.)
or organization)
</TABLE>
3401 West End Avenue, Suite 260, P.O. Box 24300, Nashville, Tennessee 37202
---------------------------------------------------------------------------
(Address of principal executive offices)
(Zip Code)
(615)269-1900
-------------
(Registrant's telephone number, including area code)
- -----------------------------------------------------------------------------
(Former name, former address and former fiscal year,
if changed since last report)
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
--- ---
Common Stock Outstanding - 5,421,538 shares at November 11, 1997.
Page 1 of 16 pages.
<PAGE> 2
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
J. ALEXANDER'S CORPORATION AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEETS
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE AMOUNT)
<TABLE>
<CAPTION>
SEPTEMBER 28 December 29
1997 1996
---- ----
(Unaudited)
<S> <C> <C>
ASSETS
CURRENT ASSETS
Cash and cash equivalents ................................. $ 774 $12,549
Accounts and notes receivable, including current portion of
direct financing leases ................................. 191 120
Inventories ............................................... 596 534
Deferred income taxes ..................................... 1,344 1,364
Prepaid expenses and other current assets ................. 678 369
Net assets held for disposal .............................. 156 618
------- -------
TOTAL CURRENT ASSETS .................................... 3,739 15,554
OTHER ASSETS ................................................. 1,174 1,197
PROPERTY AND EQUIPMENT, at cost, less allowances for
depreciation and amortization of $6,667 and $4,567 at
September 28, 1997, and December 29, 1996, respectively ... 57,412 47,016
DEFERRED INCOME TAXES ........................................ 1,669 1,429
DEFERRED CHARGES, less amortization .......................... 1,820 1,631
------- -------
$65,814 $66,827
======= =======
</TABLE>
-2-
<PAGE> 3
<TABLE>
<CAPTION>
SEPTEMBER 28 December 29
1997 1996
---- ----
(Unaudited)
<S> <C> <C>
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable.................................................... $ 3,017 $ 3,748
Accrued expenses and other current liabilities...................... 3,487 6,023
Current portion of long-term debt and obligations under
capital leases.................................................... 1,923 54
------- -------
TOTAL CURRENT LIABILITIES......................................... 8,427 9,825
LONG-TERM DEBT AND OBLIGATIONS UNDER CAPITAL
LEASES, net of portion classified as current........................ 16,246 15,930
DEFERRED COMPENSATION AND OTHER DEFERRED CREDITS....................... 605 611
STOCKHOLDERS' EQUITY
Common Stock, par value $.05 per share: Authorized 10,000,000
shares; issued and outstanding 5,421,538 and 5,322,507 shares at
September 28, 1997, and December 29, 1996, respectively........... 272 266
Preferred Stock, no par value: Authorized 1,000,000 shares; none
issued............................................................ - -
Additional paid-in capital.......................................... 29,885 29,475
Retained earnings................................................... 11,407 11,748
------- -------
41,564 41,489
Note receivable - Employee Stock Ownership Plan..................... (1,028) (1,028)
-------- -------
TOTAL STOCKHOLDERS' EQUITY........................................ 40,536 40,461
------- -------
$65,814 $66,827
======= =======
</TABLE>
See notes to consolidated condensed financial statements.
-3-
<PAGE> 4
J. ALEXANDER'S CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
Nine Months Ended Quarter Ended
----------------- -------------
SEPTEMBER 28 September 29 SEPTEMBER 28 September 29
1997 1996 1997 1996
---- ---- ---- ----
<S> <C> <C> <C> <C>
Net sales .............................. $41,634 $70,640 $14,143 $25,584
Costs and expenses:
Cost of sales ....................... 13,985 24,687 4,721 9,000
Restaurant labor and related costs .. 13,639 21,053 4,814 7,629
Depreciation and amortization of
restaurant property and equipment . 2,049 2,360 742 497
Royalties ........................... -- 1,643 -- 586
Other operating expenses ............ 7,737 11,060 2,772 4,060
------- ------- ------- -------
Total restaurant operating expenses 37,410 60,803 13,049 21,772
------- ------- ------- -------
Income from restaurant operations ...... 4,224 9,837 1,094 3,812
General and administrative expenses .... 4,058 5,531 1,571 1,967
Amortization of pre-opening costs ...... 942 737 306 275
Gain (costs) related to Wendy's
disposition ......................... 669 (542) 300 (542)
------- ------- ------- -------
Operating income (loss) ................ (107) 3,027 (483) 1,028
------- ------- ------- -------
Other income (expense):
Interest expense .................... (690) (1,220) (230) (475)
Interest income ..................... 186 34 13 8
Other, net .......................... 62 7 20 9
------- ------- ------- -------
Total other income (expense) ...... (442) (1,179) (197) (458)
------- ------- ------- -------
Income (loss) before income taxes ...... (549) 1,848 (680) 570
Income tax provision (benefit) ......... (208) 647 (240) 200
------- ------- ------- -------
Net income (loss) ...................... $ (341) $ 1,201 $ (440) $ 370
======= ======= ======= =======
Earnings (loss) per share:
Primary ............................. $ (.06) $ .22 $ (.08) $ .07
======= ======= ======= =======
Fully diluted ....................... $ (.06) $ .22 $ (.08) $ .07
======= ======= ======= ========
Weighted average number of shares:
Primary ............................. 5,400 5,469 5,422 5,476
======= ======= ======== =======
Fully diluted ....................... 5,400 5,469 5,422 5,476
======= ======= ======== =======
</TABLE>
See notes to consolidated condensed financial statements.
-4-
<PAGE> 5
J. ALEXANDER'S CORPORATION AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(UNAUDITED IN THOUSANDS)
<TABLE>
<CAPTION>
Nine Months Ended
SEPTEMBER 28 September 29
1997 1996
---- ----
<S> <C> <C>
Net cash (used) provided by operating activities ....... $ (805) $ 5,890
Net cash (used) by investing activities:
Purchase of property and equipment .................. (13,548) (16,631)
Proceeds from maturities and sales of investments ... -- 505
Other investing activities .......................... (23) (86)
-------- --------
(13,571) (16,212)
Net cash provided by financing activities:
Payments on debt and obligations under capital leases (40) (314)
Borrowings on line of credit ........................ 2,225 9,973
Other financing activities .......................... 416 276
-------- --------
2,601 9,935
Decrease in Cash and Cash Equivalents .................. (11,775) (387)
Cash and cash equivalents at beginning of period ....... 12,549 2,234
-------- --------
Cash and Cash Equivalents at End of Period ............. $ 774 $ 1,847
======== ========
</TABLE>
See notes to consolidated condensed financial statements.
-5-
<PAGE> 6
J. ALEXANDER'S CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS (UNAUDITED)
NOTE A - BASIS OF PRESENTATION
The accompanying unaudited consolidated condensed financial statements
have been prepared in accordance with generally accepted accounting principles
for interim financial information and with the instructions to Form 10-Q and
Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the
information and footnotes required by generally accepted accounting principles
for complete financial statements. Certain reclassifications have been made in
the prior year's consolidated condensed financial statements to conform to the
1997 presentation. In the opinion of management, all adjustments (consisting of
normal recurring accruals) considered necessary for a fair presentation have
been included. Operating results for the three and nine months ended September
28, 1997, are not necessarily indicative of the results that may be expected for
the fiscal year ending December 28, 1997. For further information, refer to the
consolidated financial statements and footnotes thereto included in the
Company's annual report on Form 10-K for the fiscal year ended December 29,
1996.
NOTE B - SALE OF WENDY'S RESTAURANT OPERATIONS
In November 1996, the Company sold 52 of its 58 Wendy's Old Fashioned
Hamburgers restaurants to Wendy's International, Inc. for $28.3 million in cash
plus the assumption of capitalized lease obligations and long-term debt
totalling approximately $2.5 million. This transaction generated a pre-tax gain
of $9.4 million. The six restaurants not sold as part of the November 1996
transaction had been sold or closed as of March 30, 1997.
In connection with the sale of its Wendy's restaurants, the Company
established various accruals for termination benefits and other costs associated
with its exit from the Wendy's business. During the first nine months of 1997,
the Company made cash payments of $764,000 related to these accruals. In
addition, the Company recognized $669,000 in additional gains related to the
Wendy's divestiture during the first nine months of 1997, primarily due to the
sale of two properties for amounts greater than their carrying values, a
favorable insurance settlement and other adjustments to the accruals established
during 1996. At September 28, 1997, the Company continues to maintain accruals
related to the exit of the Wendy's business totalling $771,000.
-6-
<PAGE> 7
NOTE C - PRE-OPENING COSTS
Costs of hiring and training personnel and certain other costs relating
to a new J. Alexander's restaurant were capitalized and amortized over the
restaurant's first 24 months of operations prior to 1997. In the fourth quarter
of 1996, the Company changed its period of amortization for these costs from 24
months to 12 months. Management does not anticipate the change will have a
material impact on periods subsequent to fiscal 1996.
NOTE D - EARNINGS PER SHARE
Primary earnings per share and fully diluted earnings per share are
based on the weighted average number of common shares outstanding each period,
after considering the effect of stock options, using the treasury stock method.
The computation of loss per share for the 1997 periods is based on the weighted
average number of shares outstanding as the inclusion of shares issuable upon
the exercise of options would be anti-dilutive. Shares issuable upon the
conversion of subordinated debentures are not included in either calculation
because their inclusion would be anti-dilutive.
Statement of Financial Accounting Standards No. 128, "Earnings Per
Share" ("SFAS 128"), is effective for financial statements issued for both
interim and annual periods ending after December 15, 1997 and early adoption is
not permitted. Therefore, the Company will adopt this new Standard during the
fourth quarter of 1997. SFAS 128 requires all entities to provide dual
disclosure of earnings per share, basic and fully-diluted. Basic earnings per
share equals net earnings divided by the weighted average number of common
shares outstanding and does not include the dilutive effect of stock options.
Fully diluted earnings per share is essentially the same as discussed above. The
Company does not believe that the adoption of SFAS 128 will have a material
impact on reported earnings per share.
-7-
<PAGE> 8
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULT OF OPERATIONS
RESULTS OF OPERATIONS
OVERVIEW
J. Alexander's Corporation operated sixteen J. Alexander's
full-service, casual dining restaurants at September 28, 1997. During the fourth
quarter of 1996 the Company sold substantially all the assets of its Wendy's Old
Fashioned Hamburgers division. The Company's Wendy's operations generated
restaurant operating income of $6,061,000 on sales of $41,051,000 for the nine
months ended September 29, 1996, and restaurant operating income of $2,539,000
on sales of $14,641,000 for the third quarter of 1996. As a result of the
divestiture, the Company's sales and income from restaurant operations were
significantly reduced in the first nine months and third quarter of 1997 as
compared to the same periods in 1996.
Consolidated income from restaurant operations decreased by
$5,613,000 during the first nine months of 1997 and by $2,718,000 for the third
quarter of 1997 compared to the same periods in 1996. These decreases are
primarily due to the effect of the disposition of the Company's Wendy's
restaurant operations and, in the third quarter of 1997, a $179,000 decrease in
J. Alexander's restaurant operating income. General and administrative expenses
and net interest expense also decreased during the first nine months and third
quarter of 1997 as compared to the prior year because of the Wendy's
divestiture, but these decreases were not sufficient to offset the net decreases
in income from restaurant operations. After recording additional gains related
to the Wendy's transaction of $669,000 and $300,000 for the first nine months
and third quarter of 1997, respectively, income before income taxes decreased by
$2,397,000 during the first nine months of 1997 and by $1,250,000 for the third
quarter of 1997, compared to the comparable 1996 periods.
Management reached the decision to sell the Wendy's operations
because it believed that focusing all of the Company's capital and resources
exclusively on its casual dining business will offer the greatest potential for
long-term return for its shareholders. However, the divestiture is expected to
continue to have a negative impact on earnings until the lost revenue and
operating income from the Wendy's operations can be replaced by the successful
development and operation of J. Alexander's restaurants.
J. ALEXANDER'S RESTAURANT OPERATIONS
The Company operated sixteen J. Alexander's restaurants at September
28, 1997, compared with thirteen at September 29, 1996.
J. Alexander's operating results, before allocation of other income,
corporate overhead and net interest expense, for the nine months and third
quarters ended September 28, 1997, and September 29, 1996, were as follows:
-8-
<PAGE> 9
<TABLE>
<CAPTION>
Nine Months Ended
SEPTEMBER 28, 1997 September 29, 1996
------------------ ------------------
AMOUNT % OF Amount % of
(IN THOUSANDS) SALES (in thousands) Sales
------------- ----- ------------- -----
<S> <C> <C> <C> <C>
Net sales..................................... $41,634 100.0% $29,589 100.0%
Restaurant costs and expenses:
Cost of sales............................... 13,985 33.6 10,304 34.8
Labor and related costs.................... 13,639 32.8 9,170 31.0
Depreciation and amortization of
restaurant property and equipment 2,049 4.9 1,286 4.3
Other operating expenses.................... 7,737 18.6 5,053 17.1
------- ---- ------- ----
37,410 89.9 25,813 87.2
------- ---- ------- ----
Restaurant operating income................... $ 4,224 10.1% $ 3,776 12.8%
======= ==== ======= ====
</TABLE>
<TABLE>
<CAPTION>
Quarter Ended
SEPTEMBER 28, 1997 September 29, 1996
------------------ ------------------
AMOUNT % OF Amount % of
(IN THOUSANDS) SALES (in thousands) Sales
-------------- ----- -------------- -----
<S> <C> <C> <C> <C>
Net sales..................................... $14,143 100.0% $10,943 100.0%
Restaurant costs and expenses:
Cost of sales............................... 4,721 33.4 3,758 34.3
Labor and related costs..................... 4,814 34.0 3,482 31.8
Depreciation and amortization of
restaurant property and equipment 742 5.2 497 4.5
Other operating expenses.................... 2,772 19.6 1,933 17.7
------- ----- ----- ----
13,049 92.3 9,670 88.4
------- ----- ----- ----
Restaurant operating income................... $ 1,094 7.7% $ 1,273 11.6%
======= ===== ===== ====
</TABLE>
Net sales for the J. Alexander's restaurants increased 41% and 29% for
the first nine months and third quarter of 1997, compared to the same periods
of 1996, due primarily to the opening of new restaurants. Same store sales,
which include comparable sales for all restaurants open for more than 12 months,
averaged $76,900 and $73,600 per week during the first nine months and third
quarter of 1997, reflecting increases of 1.9% and 0.4% from $75,500 and $73,300
per week for the same periods of the previous year. Average weekly sales for
all restaurants were $73,400 and $70,400 for the first nine months and third
quarter of 1997, compared to $75,200 and $72,700 for the corresponding
periods in 1996.
Restaurant operating margins for the 12 restaurants open for more than
12 months improved to 14.2% of sales for the first nine months of 1997,
compared to 13.1% for the same period of 1996, due primarily to lower food costs
attributed to continued management emphasis on cost control in this area. For
the third quarter of 1997, restaurant operating margins in the
-9-
<PAGE> 10
same store group of restaurants were 11.7% of sales, down from 12.6% of sales in
1996, as increases in certain operating expenses, including marketing costs,
more than offset lower food costs.
Management believes that the primary issue faced by the Company in
returning it to profitability is the improvement of sales in certain of the
Company's newer restaurants. In order to maximize the quality of guest service
and successfully complete the extensive training and support of J.Alexander's
staff, there is little or no advertising or promotion of new J.Alexander's
restaurant openings. Management believes that this "quiet opening" approach
enhances guest experiences and contributes significantly to increases in sales
over a long period of time. However, because of the slow building nature of
sales and the expenses associated with the Company's strong emphasis on training
and quality of operations during the opening months of operation, the financial
performance of newer restaurants typically trails that of more mature
restaurants. Additionally, management believes that the strict operational
standards it has established for J.Alexander's restaurants were not followed in
some of its newer restaurants opened prior to 1997 which has negatively affected
sales performance in some of those restaurants. Management believes that
operations in these restaurants have since been improved to satisfactory levels.
In addition, the Company's restaurants opened in Tampa, Florida and
Denver, Colorado during the second and third quarters, respectively, opened at
relatively low sales volumes. As a result, their opening losses were greater
than expected, totaling $332,000 for the third quarter.
Because of the effect of the seven new restaurants which have opened
since the first quarter of 1996, all operating cost categories, with the
exception of cost of sales, increased as a percentage of sales for the nine
months and third quarter ended September 28, 1997, as compared to the same
periods of the prior year.
Management is concentrating on building sales in its under-performing
restaurants by a combination of lowering menu prices in selected locations,
continuing emphasis on operational excellence and local marketing efforts in
selected markets. Management believes that at some of the Company's newer
restaurants, menu prices were set too high when the restaurant opened.
Previously, the Company had opened restaurants with menu prices which were very
competitive with those of other casual dining competitors and raised them over
time as guests recognized and appreciated the superior quality and service which
J.Alexander's provided. In October 1997, menu prices were lowered in two lower
volume restaurants which were opened in 1996, as well as in the Tampa and Denver
restaurants. Management believes that this pricing strategy will increase sales
over time, although it will likely reduce profit margins in those restaurants in
the near term. Management is also lowering the Company's planned unit growth
rate in order to ensure that the Company continues to maintain its focus on
operational excellence, strict adherence to operating standards and efficiency
of operations in both new and existing restaurants. Management believes that all
of these efforts will improve the Company's operating results in 1998.
GENERAL AND ADMINISTRATIVE EXPENSES
General and administrative expenses, which include all costs above the
restaurant level, decreased by $1,473,000 (27%) and $396,000 (20%), during the
first nine months and third quarter of 1997 as compared to the same periods in
1996, primarily due to the disposition of the Company's Wendy's restaurant
operations. However, general and administrative expenses as a percent of sales
increased to 9.7% and 11.1% of sales for the first nine months and third quarter
of 1997, respectively, compared to 7.8% and 7.7% of sales for the 1996 periods.
Increase in travel, relocation and training expenses related to restaurants
opened in 1997 account for a significant portion of the increase as a percent
of sales in the third quarter of 1997.
OTHER INCOME (EXPENSE)
Interest expense decreased by $530,000 and $245,000 during the first
nine months and third quarter of 1997, respectively, compared to the same
periods of the prior year, due primarily to elimination of long-term obligations
associated with Wendy's restaurant operations and the November 1996 pay-off of
all amounts then outstanding under the Company's line of credit agreement with
proceeds from the Wendy's disposition.
Interest income increased by $152,000 and $5,000 during the first nine
months and third quarter of 1997, compared to the same periods of 1996, due
to increased investment balances resulting from the Wendy's disposition.
-10-
<PAGE> 11
INCOME TAXES
Under the provisions of Statement of Financial Accounting Standards No.
109 "Accounting for Income Taxes," the Company has significant deferred tax
assets at September 28, 1997 relating primarily to approximately $2.9 million of
net operating loss carryforwards and $1.8 million of tax credit carryforwards
available to reduce future federal income taxes. Management believes that future
taxable income, combined with alternative tax planning strategies, will be
sufficient to realize all of the Company's deferred tax assets and, therefore,
no valuation allowance has been provided for these assets.
LIQUIDITY AND CAPITAL RESOURCES
The Company had a cash flow deficit from operations of $805,000
(including $764,000 of payments against accruals related to the Wendy's
disposition) for the first nine months of 1997, compared to positive cash
flow from operations of $5,890,000 in the same period of the prior year. The
Company had cash and cash equivalents of $774,000 at September 28, 1997.
The Company's primary investing activity is expected to continue to be
capital expenditures for the development and maintenance of its J. Alexander's
restaurants. Management may also consider acquisitions of additional restaurants
similar to J. Alexander's. In addition, on June 1, 1998, the Company will be
required to make annual sinking fund payments of $1,864,000 in connection with
its Convertible Subordinated Debentures.
The Company's sixteenth J. Alexander's restaurant opened in August
1997 in Englewood, Colorado. During October 1997, the Company opened a
J. Alexander's in Livonia, Michigan and will open its eighteenth restaurant in
San Antonio, Texas, in December 1997. This restaurant, along with a restaurant
in Louisville, Kentucky expected to open in the first quarter of 1998, are
currently under construction. Capital expenditures totalled $12,553,000 during
the first nine months of 1997 and were primarily for the development of
J. Alexander's restaurants. The Company estimates that its capital expenditures
for the last quarter of 1997 will total approximately $4,000,000.
The Company presently maintains a $30,000,000 line of credit, which is
available for funding of capital expenditures. At September 28, 1997, borrowings
outstanding under this line of credit totalled $2,225,000. Borrowings under the
line of credit may be made through July 1, 1998, with the option of converting
outstanding borrowings to a term loan at that time. The Company was in
compliance with the financial covenants in its line of credit agreement at
September 28, 1997. Based on the Company's operating results during the first
nine months of 1997, combined with anticipated operating results for the fourth
quarter, management expects that the Company will not be in compliance at the
end of 1997 with certain financial covenants included in the line of credit
agreement unless those covenants are modified by its lender. As a result, the
Company will seek to renegotiate certain provisions of its line of credit
agreement to include an amendment or waiver of certain financial covenants, as
well as an extension of its term. Based on current discussions, management
believes that it will successfully complete these negotiations during the fourth
quarter and that the line of credit will provide adequate liquidity for the
-11-
<PAGE> 12
Company through 1998; however, there can be no assurance that the
Company will be successful in obtaining modifications to its existing credit
agreement.
-12-
<PAGE> 13
J. Alexander's Corporation and Subsidiaries
EXHIBIT 11 - STATEMENT RE: COMPUTATION OF EARNINGS PER SHARE
<TABLE>
<CAPTION>
Nine Months Ended Quarter Ended
----------------- -------------
SEPTEMBER 28 September 29 SEPTEMBER 28 September 29
1997 1996 1997 1996
---- ---- ---- ----
<S> <C> <C> <C> <C>
Earnings (loss) per common and dilutive common
equivalent share
Net income (loss)............................... $(341,000) $1,201,000 $ (440,000) $ 370,000
========= ========== ========== ==========
Adjustment of shares outstanding:
Actual weighted average shares outstanding.... 5,400,000 5,297,000 5,422,000 5,315,000
Net additional shares issuable, based on the
treasury stock method....................... -- 172,000 -- 161,000
---------- ---------- ----------
Adjusted shares outstanding................... 5,400,000 5,469,000 5,422,000 5,476,000
========== ========== ========== ==========
Per share amount................................ $ (.06) $ .22 $ (.08) $ .07
=========== ========== ========== ==========
Earnings (loss) per common share, assuming full dilution
Net income (loss)............................... $ (341,000) $1,201,000 $ (440,000) $ 370,000
=========== ========== ========== ==========
Adjustment of shares outstanding:
Actual weighted average shares outstanding.... 5,400,000 5,297,000 5,422,000 5,315,000
Net additional shares issuable, based on the
treasury stock method....................... -- 172,000 -- 161,000
----------- ---------- ----------
Adjusted shares outstanding................... 5,400,000 5,469,000 5,422,000 5,476,000
=========== ========== ========== ==========
Per share amount................................ $ (.06) $ .22 $ (.08) $ .07
=========== ========== ========== ==========
</TABLE>
Note: The computations of earnings per common and dilutive common equivalent
share and earnings per common share, assuming full dilution, are based on
the weighted average number of common shares outstanding each period
after considering the effect of stock options using the treasury stock
method. The computation of loss per share for the 1997 periods is based
on the weighted average number of shares outstanding as the inclusion of
shares issuable upon the exercise of options would be anti-dilutive.
Shares issuable upon the conversion of convertible subordinated
debentures have not been included as the effect of their inclusion would
be anti-dilutive.
-13-
<PAGE> 14
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits:
Exhibit (11) Computation of Earnings Per Share is filed with Part
I of this Form 10-Q.
Exhibit (27) Financial Data Schedule (for SEC use only)
(b) No reports on Form 8-K were filed for the quarter ended September
28, 1997.
-14-
<PAGE> 15
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.
J. ALEXANDER'S CORPORATION
/s/ Lonnie J. Stout II
-----------------------------------------------
Lonnie J. Stout II
Chairman, President and Chief Executive Officer
/s/ R. Gregory Lewis
-----------------------------------------------
R. Gregory Lewis
Vice-President and Chief Financial Officer
Date: November 12, 1997
-15-
<PAGE> 16
J. ALEXANDER'S CORPORATION AND SUBSIDIARIES
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
Exhibit No. Page No.
- ----------- --------
<S> <C>
(11) Computation of Earnings per Share 13
(27) Financial Data Schedules (For SEC Use Only)
</TABLE>
-16-
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONSOLIDATED CONDENSED FINANCIAL STATEMENTS AS OF AND FOR THE NINE MONTH PERIOD
ENDED SEPTEMBER 28, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-28-1997
<PERIOD-START> DEC-30-1996
<PERIOD-END> SEP-28-1997
<CASH> 774
<SECURITIES> 0
<RECEIVABLES> 191
<ALLOWANCES> 0
<INVENTORY> 596
<CURRENT-ASSETS> 3,739
<PP&E> 64,079
<DEPRECIATION> 6,667
<TOTAL-ASSETS> 65,814
<CURRENT-LIABILITIES> 8,427
<BONDS> 16,246
0
0
<COMMON> 272
<OTHER-SE> 40,264
<TOTAL-LIABILITY-AND-EQUITY> 65,814
<SALES> 41,634
<TOTAL-REVENUES> 41,634
<CGS> 13,985
<TOTAL-COSTS> 27,624
<OTHER-EXPENSES> 9,786
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 690
<INCOME-PRETAX> (549)
<INCOME-TAX> (208)
<INCOME-CONTINUING> (341)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (341)
<EPS-PRIMARY> (.06)
<EPS-DILUTED> (.06)
</TABLE>
