<PAGE>
================================================================================
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-Q
[X] Quarterly report pursuant to section 13 or 15 (d) of the Securities
Exchange Act of 1934
For the quarterly period ended March 31, 2000
or
[ ] Transition report pursuant to section 13 or 15 (d) of the Securities
Exchange Act of 1934
Commission File Number
0-25629
CARROLS CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 16-0958146
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
968 James Street
Syracuse, New York 13203
(Address of principal executive offices) (Zip Code)
Registrant's telephone number including area code: (315) 424-0513
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, par value $1.00, outstanding at May 12, 2000: 10 shares
================================================================================
<PAGE>
PART 1
Item 1 - FINANCIAL INFORMATION
CARROLS CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
March 31, December 31,
ASSETS 2000 1999
- ------ ------------------ -----------------
(unaudited)
Current assets:
<S> <C> <C>
Cash and cash equivalents $ 2,050,000 $ 1,901,000
Trade and other receivables 1,453,000 787,000
Inventories 3,951,000 4,211,000
Prepaid rent 1,784,000 1,829,000
Prepaid expenses and other current assets 1,426,000 1,629,000
Refundable income taxes 437,000 682,000
Deferred income taxes 7,095,000 6,475,000
------------ ------------
Total current assets 18,196,000 17,514,000
Property and equipment, at cost less accumulated
depreciation of $94,348,000 and $91,599,000,
respectively 125,376,000 122,813,000
Franchise rights, at cost less accumulated
amortization of $35,406,000 and $34,174,000,
respectively 100,802,000 101,927,000
Intangible assets, at cost less accumulated
amortization of $11,865,000 and $11,328,000
respectively 67,019,000 67,545,000
Other assets 9,823,000 10,228,000
------------ ------------
$321,216,000 $320,027,000
============ ============
</TABLE>
The accompanying notes are an integral part of these financial statements.
2
<PAGE>
CARROLS CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS (continued)
<TABLE>
<CAPTION>
March 31, December 31,
LIABILITIES and STOCKHOLDER'S EQUITY 2000 1999
- ------------------------------------ ------------ ------------
(unaudited)
Current liabilities:
<S> <C> <C>
Accounts payable $ 12,001,000 $ 19,345,000
Accrued interest 5,798,000 1,920,000
Accrued payroll, related taxes and benefits 7,066,000 7,267,000
Other liabilities 6,296,000 6,302,000
Current portion of long-term debt 4,250,000 4,120,000
Current portion of capital lease obligations 249,000 256,000
------------ ------------
Total current liabilities 35,660,000 39,210,000
Long-term debt, net of current portion 242,411,000 247,661,000
Capital lease obligations, net of current portion 1,395,000 1,457,000
Deferred income - sale/leaseback of real estate 4,395,000 4,463,000
Accrued postretirement benefits 1,945,000 1,913,000
Deferred income taxes 1,208,000 1,208,000
Other liabilities and deferred income 19,664,000 9,064,000
------------ ------------
Total liabilities 306,678,000 304,976,000
Stockholder's equity:
Common stock, par value $1; authorized 1,000
shares, 10 10
issued and outstanding - 10 shares
Additional paid-in capital 24,484,990 24,484,990
Accumulated deficit (9,947,000) (9,434,000)
------------ ------------
Total stockholder's equity 14,538,000 15,051,000
------------ ------------
$321,216,000 $320,027,000
============ ============
</TABLE>
The accompanying notes are an integral part of these financial statements.
3
<PAGE>
CARROLS CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
THREE MONTHS ENDED MARCH 31, 2000 AND 1999
<TABLE>
<CAPTION>
2000 1999
------------ ------------
(13 Weeks) (13 Weeks)
(unaudited)
Revenues:
<S> <C> <C>
Restaurant sales $109,523,000 $104,662,000
Franchise fees and royalty revenues 228,000 272,000
------------ ------------
Total revenues 109,751,000 104,934,000
Costs and expenses:
Cost of sales 31,412,000 31,369,000
Restaurant wages and related expenses 32,736,000 32,259,000
Other restaurant operating expenses 22,482,000 21,636,000
Advertising expense 5,356,000 4,449,000
General and administrative 6,176,000 6,004,000
Depreciation and amortization 6,682,000 5,771,000
------------ ------------
Total operating expenses 104,844,000 101,488,000
------------ ------------
Income from operations 4,907,000 3,446,000
Interest expense 5,840,000 5,713,000
------------ ------------
Loss before income taxes and extraordinary loss (933,000) (2,267,000)
Income tax benefit (420,000) (1,148,000)
------------ ------------
Loss before extraordinary loss (513,000) (1,119,000)
Extraordinary loss on write-off of debt issue - 940,000
costs, net of taxes ------------ ------------
Net loss $ (513,000) $(2,059,000)
============ ============
</TABLE>
The accompanying notes are an integral part of these financial statements.
4
<PAGE>
CARROLS CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
THREE MONTHS ENDED MARCH 31, 2000 AND 1999
<TABLE>
<CAPTION>
2000 1999
----------- ------------
(13 Weeks) (13 Weeks)
(unaudited)
Cash flows from operating activities:
<S> <C> <C>
Net loss $ (513,000) $ (2,059,000)
Adjustments to reconcile net loss to cash provided
by operating activities:
Depreciation and amortization 6,682,000 5,771,000
Deferred income taxes (620,000) (95,000)
Loss on sale of property and equipment 12,000 -
Extraordinary loss on write-off of debt issue -
costs, net of tax 940,000
Change in operating assets and liabilities 7,874,000 3,874,000
----------- ------------
Net cash provided by operating activities 13,435,000 8,431,000
----------- ------------
Cash flows from investing activities:
Capital expenditures:
New restaurant development (3,033,000) (2,105,000)
Restaurant remodeling (1,761,000) (2,388,000)
Corporate and restaurant information systems (2,254,000) (1,185,000)
Other capital expenditures (1,053,000) (4,983,000)
Proceeds from sales of property and equipment 4,000 -
----------- ------------
Net cash used for investing activities (8,097,000) (10,661,000)
----------- ------------
Cash flows from financing activities:
Principal payments on long-term debt, net (5,120,000) (1,462,000)
Financing costs associated with issuance of debt - (846,000)
Principal payments on capital leases (69,000) (82,000)
----------- ------------
Net cash used for financing activities (5,189,000) (2,390,000)
----------- ------------
Increase (decrease) in cash and cash equivalents 149,000 (4,620,000)
Cash and cash equivalents, beginning of period 1,901,000 6,777,000
----------- ------------
Cash and cash equivalents, end of period $ 2,050,000 $ 2,157,000
=========== ============
</TABLE>
The accompanying notes are an integral part of these financial statements.
5
<PAGE>
CARROLS CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
1. Accounting Policies
-------------------
The accompanying consolidated financial statements have been prepared
without audit, pursuant to the rules and regulations of the Securities and
Exchange Commission and do not include all of the information and the
footnotes required by generally accepted accounting principles for complete
statements. In the opinion of management, all normal and recurring
adjustments necessary for a fair presentation of such financial statements
have been included.
The results of operations for the three months ended March 31, 2000 and
1999 are not necessarily indicative of the results to be expected for the
full year.
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those
estimates.
These consolidated financial statements should be read in conjunction with
the consolidated financial statements and notes thereto for the year ended
December 31, 1999 contained in our 1999 Annual Report on Form 10-K. The
December 31, 1999 balance sheet data is derived from these audited
financial statements.
Certain amounts for the prior year have been reclassified to conform to the
current year presentation.
2. Income Taxes
------------
The income tax benefit for the three months ended March 31, 2000 and 1999
was comprised of the following:
2000 1999
--------- -----------
Current $ 200,000 $(1,053,000)
Deferred (620,000) (95,000)
--------- -----------
$(420,000) $(1,148,000)
========= ===========
6
<PAGE>
CARROLS CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED CONDENSED
FINANCIAL STATEMENTS (continued)
For 2000 and 1999 the difference between the expected tax provision
resulting from application of the federal statutory income tax rate to the
pre-tax loss and the reported income tax benefit result principally from
state taxes and non-deductible amortization of franchise rights and certain
other intangibles.
3. Summarized Financial Information of Certain Subsidiaries
--------------------------------------------------------
The following table presents summarized combined financial information for
the following wholly-owned subsidiaries, whom unconditionally guarantee the
$170 million principal amount of 9 1/2% Senior Subordinated Notes due
2008 of the Company:
Carrols Realty Holdings, Carrols Realty I Corp., Carrols Realty II Corp.,
Carrols J.G. Corp., Quanta Advertising Corp., Pollo Franchise Inc. and
Pollo Operations, Inc.
<TABLE>
<CAPTION>
March 31, 2000 December 31, 1999
----------------- -----------------
<S> <C> <C>
Balance Sheet:
Current assets $ 3,314,000 $ 2,657,000
Non-current assets 89,607,000 89,527,000
Current liabilities 5,422,000 5,734,000
Non-current liabilities 78,877,000 78,549,000
<CAPTION>
Three Months Ended
March 31,
2000 1999
----------------- -----------------
<S> <C> <C>
Statement of Operations:
Revenues $22,788,000 $21,609,000
Operating expenses 18,958,000 18,073,000
Income from operations 3,830,000 3,536,000
Net income 1,151,000 926,000
</TABLE>
7
<PAGE>
CARROLS CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED CONDENSED
FINANCIAL STATEMENTS (continued)
4. Business Segment Information
----------------------------
The Company is engaged in the quick-service restaurant industry, with two
restaurant concepts: Burger King, operating as a franchisee, and Pollo
Tropical, a Company owned concept. The Company's Burger King restaurants
are all located in the United States, primarily in the Northeast, Southeast
and Midwest. Pollo Tropical is a regional quick-service restaurant chain
featuring grilled marinated chicken and authentic "made from scratch" side
dishes. Pollo Tropical's core markets are located in south and central
Florida.
Segment information for Burger King restaurants and Pollo Tropical for the
three months ended March 31, 2000 and 1999 is shown in the following table.
The "Other" column includes corporate related items not allocated to
reportable segments and for income from operations, principally corporate
depreciation and amortization. Other identifiable assets consist primarily
of franchise rights and intangible assets. Non-operating expenses,
comprised of interest expense and the extraordinary loss, are corporate
related items and therefore have not been allocated to the reportable
segments.
<TABLE>
<CAPTION>
Burger
King Pollo
Restaurants Tropical Other Consolidated
------------ ------------ ---------- ----------------
($ in 000's)
Three Months Ended March 31, 2000:
<S> <C> <C> <C> <C>
Revenues $ 87,038 $22,713 $ $109,751
Cost of sales 23,996 7,416 31,412
Restaurant wages and related
expenses 27,776 4,960 32,736
Depreciation and amortization 3,836 500 2,346 6,682
Income from operations 2,915 4,338 (2,346) 4,907
Identifiable assets 200,570 24,905 95,741 321,216
Capital expenditures, excluding
acquisitions 5,596 2,079 426 8,101
</TABLE>
8
<PAGE>
CARROLS CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED CONDENSED
FINANCIAL STATEMENTS (continued)
<TABLE>
<CAPTION>
Burger
King Pollo
Restaurants Tropical Other Consolidated
------------ ------------ ---------- ----------------
($ in 000's)
Three Months Ended March 31, 1999:
<S> <C> <C> <C> <C>
Revenues $ 83,556 $21,378 $ $104,934
Cost of sales 23,977 7,392 31,369
Restaurant wages and related
expenses 27,411 4,848 32,259
Depreciation and amortization 3,197 477 2,097 5,771
Income from operations 1,549 3,994 (2,097) 3,446
Identifiable assets 197,664 24,190 94,792 316,646
Capital expenditures, excluding
acquisitions 5,755 4,404 502 10,661
</TABLE>
5. Extraordinary Loss
------------------
On February 12, 1999, the Company entered into a new senior credit facility
with Chase Bank of Texas, National Association, as agent and lender, and
other lenders as parties thereto. In connection with this transaction, the
Company recognized an extraordinary loss of $940,000, net of $885,000 in
income taxes, in the first quarter of 1999. This loss represents the write-
off of unamortized debt issue costs related to the previous senior credit
facility.
9
<PAGE>
Item 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS
OF OPERATIONS AND FINANCIAL CONDITION
Certain statements included in this "Management's Discussion and Analysis
of Results of Operations and Financial Condition" and elsewhere in this
Quarterly Report on Form 10-Q which are not statements of historical fact
are intended to be, and are hereby identified as, "forward-looking
statements" within the meaning of Section 27A of the Securities Act of
1933, as amended, and Section 21E of the Securities Exchange Act of 1934,
as amended. Without limiting the foregoing, the words "believe,"
"anticipate," "plan," "expect," "estimate," "intend," and other similar
expressions are intended to identify forward-looking statements. The
Company cautions readers that forward-looking statements involve known and
unknown risks, uncertainties and other factors that may cause the actual
results, performance or achievements of the Company to be materially
different from any future results, performance or achievement expressed or
implied by such forward-looking statements. Such factors include, among
others, the following: the success or failure of the Company in
implementing its current business and operational strategies; availability,
terms and access to capital and customary trade credit; general economic
and business conditions; competition; changes in the Company's business
strategy; labor relations; the outcome of pending or yet-to-be instituted
legal proceedings; labor and employee benefit costs; and availability and
terms of necessary or desirable financing or refinancing.
Overview
- --------
As of March 31, 2000, we operated 355 Burger King restaurants located in 13
Northeastern, Midwestern and Southeastern states and owned and operated 44
Pollo Tropical restaurants in Florida. In addition, at March 31, 2000, we
franchised 23 Pollo Tropical restaurants primarily in Puerto Rico. Since
March 31, 1999, we have built four Pollo Tropical restaurants, built ten
Burger King restaurants, acquired six Burger King restaurants and closed
five under-performing Burger King restaurants. At March 31, 2000, one Pollo
Tropical restaurant was closed due to a fire in the first quarter of 2000.
Comparable store sales data is for a comparable number of weeks for each
period discussed.
10
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS
OF OPERATIONS AND FINANCIAL CONDITION (continued)
Results of Operations
- ---------------------
Three Months Ended March 31, 2000 Compared to Three Months Ended March 31, 1999.
The following table sets forth, for the three months ended March 31, 2000 and
1999, selected operating results as a percentage of restaurant sales:
2000 1999
---- ----
Restaurant sales:
Burger King restaurants 79.5% 79.8%
Pollo Tropical 20.5 20.2
----- -----
100.0 100.0
Costs and expenses:
Cost of sales 28.7 30.0
Restaurant wages and related expenses 29.9 30.8
Other restaurant expenses including advertising 25.4 24.9
General and administrative 5.6 5.7
Depreciation and amortization 6.1 5.5
----- -----
Income from restaurant operations 4.3% 3.1%
===== =====
Restaurant Sales
- ----------------
Restaurant sales for the three months ended March 31, 2000 increased 4.6% to
$109.5 million from $104.7 million in the first quarter of 1999. Burger King
restaurant sales increased $3.5 million, or 4.2%, over 1999 due to the net
addition of eleven restaurants since the end of the first quarter of 1999 and a
.9% increase in sales at our comparable Burger King restaurants. Pollo Tropical
sales increased $1.4 million in the first quarter of 2000 compared to 1999. This
increase was due to the opening of four new restaurants in the twelve months
ended March 31, 2000 and a 5.1% increase in sales at comparable Pollo Tropical
restaurants for the first quarter. This increase was offset, in part, by the
effect of an extra week of operating results included in the first quarter of
1999 in order to conform Pollo Tropical to the Company's fiscal calendar.
Operating Costs and Expenses
- ----------------------------
Cost of sales (food and paper costs), as a percentage of restaurant sales, were
28.7% for the first quarter of 2000 compared to 30.0% for the first quarter of
1999. This decrease, in part, reflected the effects of menu price increases of
approximately 1% in the third quarter of 1999 at our Burger King restaurants
and menu price increases in the first quarter of 2000 of approximately 1% at our
Pollo Tropical restaurants. In addition, higher supplier rebates in the first
quarter of 2000 at both our Burger King and Pollo Tropical restaurants and
effects of lower chicken costs for Pollo Tropical resulted in further
reductions.
11
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS
OF OPERATIONS AND FINANCIAL CONDITION (continued)
Restaurant wages and related expenses, as a percentage of sales, decreased from
30.8% in the first quarter of 1999 to 29.9% in the first quarter of 2000. This
decrease was due primarily to labor efficiencies at both our Burger King and
Pollo Tropical restaurants and to a lesser extent due to the effects of menu
price increases since the end of the first quarter of 1999. Labor efficiencies
at our Burger King restaurants reflected a 6.9% decrease in average restaurant
labor hours due to operating improvements. Pollo Tropical also improved as a
result of the operating leverage achieved with the strong comparable store sales
increase in the first quarter. These efficiencies were partially offset by a
3.9% increase in the hourly labor rate at our Burger King restaurants.
Other restaurant operating expenses, including advertising, increased from 24.9%
of restaurant sales in the first quarter of 1999 to 25.4% in the first quarter
of 2000 due to a $.9 million increase in advertising. This increase reflected a
difference in the timing of advertising at our Pollo Tropical restaurants and
increased advertising contributions at our Burger King restaurants due to sales
increases and higher spending on local advertising. Occupancy costs also
increased due to the sale/leaseback of eight Burger King and five Pollo Tropical
restaurant properties in June 1999, however the effect of this was offset by
reductions in other costs.
Administrative expenses increased to $6.2 million in the first quarter of 2000
from $6.0 million in the first quarter of 1999 but decreased, as a percentage of
sales, from 5.7% in 1999 to 5.6% in 2000.
Earnings before interest, taxes, depreciation and amortization and non-cash
extraordinary items ("EBITDA") was $9.2 million in the first quarter of 1999
compared to $11.6 million in the first quarter of 2000. As a percentage of
total revenues, EBITDA margins increased from 8.8% in the first quarter of 1999
to 10.6% in the first quarter of 2000 as a result of the factors discussed
above.
Depreciation and amortization increased $0.9 million in the first quarter of
2000 from the first quarter of 1999 due to the Company's capital expenditures of
$46.1 million since the end of the first quarter of 1999.
Interest expense was $5.8 million in the first quarter of 2000 compared to $5.7
million in the first quarter of 1999 due to higher effective interest rates in
the first quarter of 2000.
The provision for income taxes in the first quarter of 2000 was derived on an
estimated effective income tax rate for 2000 of 45.0%. This rate is higher than
the Federal statutory tax rate due to state franchise taxes and non-deductible
amortization of franchise rights and certain other intangible assets.
Liquidity and Capital Resources
- -------------------------------
We do not have significant receivables or inventory and receive trade credit
based upon negotiated terms in purchasing food products and other supplies. We
are able to operate with a substantial working capital deficit because:
. restaurant operations are conducted on a cash basis
. rapid turnover allows a limited investment in inventories, and
. cash from sales is usually received before related accounts for
food, supplies and payroll become due.
12
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS
OF OPERATIONS AND FINANCIAL CONDITION (continued)
Our cash requirements arise primarily from:
. the need to finance the opening and equipping of new restaurants;
. ongoing capital reinvestment in our existing restaurants;
. the acquisition of existing Burger King restaurants;
. and for servicing our debt.
Our operations in the first three months generated approximately $13.4 million
in cash in 2000, compared with $8.4 million in 1999.
Capital expenditures represent a major investment of cash for the Company, and
totaled, excluding acquisitions, $8.1 million and $10.7 million in the first
three months of 2000 and 1999, respectively. Expenditures for new restaurant
development were $3.0 million and $2.1 million in the first three months of 2000
and 1999, respectively. Capital expenditures in 1999 included $3.3 million for
the purchase of the land and building for two Pollo Tropical restaurants that
were previously leased.
In 2000, we anticipate total capital expenditures of approximately $40 million,
excluding the cost of any acquisitions that we may make. These amounts include
approximately $11 million for construction of new Burger King restaurants,
including certain real estate; $4 million for construction of new Pollo Tropical
restaurants; approximately $11 million for remodeling existing Burger King
restaurants; and approximately $3.5 million for expenditures related to Burger
King transformation initiatives, which include new signage and other
improvements such as painting, parking lot improvements and landscaping.
Remodeling activities in 2000 include approximately $6.5 million of expenditures
related to the Burger King Early Successor Incentive Program. Other anticipated
Burger King restaurant capital expenditures in 2000 for ongoing reinvestment are
approximately $6 million. We are also in the process of completing the rollout
of new restaurant point-of-sale systems and anticipate that we will incur
related expenditures of approximately $2.5 million in 2000.
At March 31, 2000, we had total indebtedness of $248.3 million comprised of
$170.0 million of unsecured 9.5% Senior Subordinated Notes due 2008, total
borrowings under our senior credit facility of $76.1 million and other debt of
$2.2 million. Our senior credit facility provides for a term loan facility of
$50 million and a revolving credit facility under which we may borrow up to
$105.0 million (including a standby letter of credit facility for up to $5
million). At March 31, 2000, $46.0 million was outstanding under the term loan
facility and $72,250,000 was available for borrowings under our revolving credit
facility, after reserving $2,650,000 for a letter of credit issued under the
facility.
Interest payments under our senior subordinated notes and other existing debt
obligations represent significant liquidity requirements for us. We believe cash
generated from our operations and availability under our revolving credit
facility will provide sufficient cash availability to cover our working capital
needs, capital expenditures, planned development and debt service requirements
for the next twelve months.
13
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS
OF OPERATIONS AND FINANCIAL CONDITION (continued)
Burger King Transformation Activities
- -------------------------------------
Burger King Corporation has arranged for the Coca-Cola Company and Dr.
Pepper/Seven-Up, Inc. to make funds available to franchisees to be used in
connection with the transformation initiatives. By agreeing to make the
investments associated with these initiatives, we will be entitled to receive
$56,000 per restaurant, or approximately $20.0 million in the aggregate, from
the fund established by Coca-Cola and Dr. Pepper. We received the first
installment, which totaled $9.9 million, in March 2000 and expect to receive the
balance of the funds no later than September 30, 2000.
AmeriServe Food Distribution, Inc.
- ----------------------------------
We currently obtain substantially all of our foodstuffs for our Burger King
restaurants (other than bread products we purchase from local bakeries), paper
goods, promotional premiums and packaging materials from AmeriServe Food
Distribution, Inc. under a supply agreement which, as amended on November 22,
1999, expires on May 15, 2000. On January 31, 2000, AmeriServe filed for
protection under Chapter 11 of the U.S. Bankruptcy Code. In general, this has
not had a material effect on the operation of our restaurants.
Restaurants Services, Inc., the purchasing cooperative for the Burger King
system, has entered into new long-term supply agreements with distributors that
will service our Burger King restaurants. The transition to our new suppliers
has begun in May, 2000 and is anticipated to be completed in June, 2000. We
estimate that our supply costs will increase by approximately .2% as a
percentage of sales due to this change in distributors.
Inflation
- ---------
The inflationary factors which have historically affected our results of
operations include increases in food and paper costs, labor and other operating
expenses. Wages paid in our restaurants are impacted by changes in the Federal
or state minimum hourly wage rates. Accordingly, changes in the Federal or state
minimum hourly wage rate directly affect our labor cost. We and the restaurant
industry typically attempt to offset the effect of inflation, at least in part,
through periodic menu price increases and various cost reduction programs.
However, no assurance can be given that we will be able to offset such
inflationary cost increases in the future.
14
<PAGE>
PART II - OTHER INFORMATION
- ---------------------------
Item 1. Legal Proceedings
There were no material legal proceedings commenced by or initiated
against the Company during the reported quarter or material
developments in any previously reported litigation.
Item 2. Changes in Securities
None
Item 3. Default Upon Senior Securities
None
Item 4. Submission of Matters to a Vote of Security Holders
None
Item 5. Other Information
None
Item 6. Exhibits and Reports on Form 8K
a. The following exhibits are filed as part of this report.
Exhibit No.
-----------
27 Financial Data Schedule
b. There were no reports on Form 8-K filed during the reported
quarter.
15
<PAGE>
SIGNATURE
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.
CARROLS CORPORATION
968 James Street
Syracuse, New York 13203
(Registrant)
Date: May 15, 2000 /s/____________________________________
(Signature)
Alan Vituli
Chairman and Chief Executive Officer
Date: May 15, 2000 /s/___________________________________
(Signature)
Paul R. Flanders
Vice President - Finance (Principal Financial Officer
and Principal Accounting Officer)
16
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
This schedule contains Summary Financial Information extracted from the
Quarterly Report for the three months ended March 31, 2000 of Carrols
Corporation and is qualified in its entirety by reference to such financial
statement.
</LEGEND>
<CAPTION>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-2000
<PERIOD-END> MAR-31-2000
<CASH> 2,050,000
<SECURITIES> 0
<RECEIVABLES> 1,453,000
<ALLOWANCES> (68,000)
<INVENTORY> 3,951,000
<CURRENT-ASSETS> 18,196,000
<PP&E> 219,724,000
<DEPRECIATION> (94,348,000)
<TOTAL-ASSETS> 321,216,000
<CURRENT-LIABILITIES> 35,660,000
<BONDS> 243,806,000
0
0
<COMMON> 0
<OTHER-SE> 14,538,000
<TOTAL-LIABILITY-AND-EQUITY> 321,216,000
<SALES> 109,523,000
<TOTAL-REVENUES> 109,751,000
<CGS> 31,412,000
<TOTAL-COSTS> 93,312,000
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 5,840,000
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</TABLE>
