SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 10-QSB
(Mark One)
(X) QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended OCTOBER 31, 1999
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 0-8513
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CHEFS INTERNATIONAL, INC.
- --------------------------------------------------------------------------------
(Exact name of small business issuer as specified in its charter)
DELAWARE 22-2058515
- ------------------------------- --------------------------------
(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
62 BROADWAY, POINT PLEASANT BEACH, NJ 08742
-------------------------------------------
(Address of principal executive offices)
(Issuer's telephone number, including area code) (732) 295-0350
--------------------------
- --------------------------------------------------------------------------------
(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 of the past 90 days. Yes X No
---. ---.
Indicate the number of shares outstanding of each of the issuer's classes
of common equity, as of the latest practicable date:
CLASS OUTSTANDING SHARES AT DECEMBER 8, 1999
- --------------------------- ---------------------------------------
Common Stock, $.01 par value 4,488,162
<PAGE>
CHEFS INTERNATIONAL, INC.
I N D E X
PART I FINANCIAL INFORMATION PAGE NO.
--------------------- --------
ITEM 1. Consolidated Financial Statements
Consolidated Balance Sheets - 1 - 2
October 31, 1999 and January 31, 1999
. Consolidated Statements of Operations - 3
Nine and Three Months Ended October 31, 1999 and
October 25, 1998
Consolidated Statements of Cash Flows - 4
Nine Months Ended October 31, 1999 and
October 25, 1998
Notes to Consolidated Financial Statements 5 - 6
ITEM 2. Management's Discussion and Analysis 7 - 10
of Financial Condition and Results of Operations
<PAGE>
PART I - FINANCIAL INFORMATION
CHEFS INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
ASSETS
------
<TABLE>
<CAPTION>
OCTOBER 31, 1999 JANUARY 31, 1999
---------------- ----------------
(Unaudited)
<S> <C> <C>
CURRENT ASSETS:
Cash and cash equivalents $ 1,599,678 $ 871,950
Investments 200,000 400,000
Miscellaneous receivables 60,650 71,278
Inventories 1,031,025 995,647
Due on sale of discontinued operations
from related party 78,981 68,355
Assets held for sale --- 135,000
Prepaid expenses 114,552 157,472
------------ -----------
TOTAL CURRENT ASSETS 3,084,886 2,699,702
----------- -----------
PROPERTY, PLANT AND EQUIPMENT, at cost 20,054,072 19,747,731
Less: Accumulated depreciation 8,047,122 7,322,169
---------- -----------
PROPERTY, PLANT AND EQUIPMENT, net 12,006,950 12,425,562
---------- -----------
OTHER ASSETS:
Investments 775,000 534,000
Goodwill - net 484,536 502,580
Liquor licenses - net 528,532 544,233
Due on sale of discontinued operations
from related party 149,824 211,149
Equity in life insurance policies 458,600 458,600
Due from related party 764 2,427
Other 36,430 22,482
----------- -----------
TOTAL OTHER ASSETS 2,433,686 2,275,471
----------- -----------
TOTAL ASSETS $17,525,522 $17,400,735
=========== ===========
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE>
CONSOLIDATED BALANCE SHEETS (CONTINUED)
LIABILITIES AND STOCKHOLDERS' EQUITY
------------------------------------
<TABLE>
<CAPTION>
OCTOBER 31, 1999 JANUARY 31, 1999
---------------- ----------------
(Unaudited)
<S> <C> <C>
CURRENT LIABILITIES:
Notes and mortgages payable $ 362,870 $ 586,342
Accounts payable 549,468 657,363
Accrued payroll 102,771 91,328
Accrued expenses 500,689 370,548
Other Liabilities 180,460 321,263
Income taxes payable 35,374 19,700
----------- -----------
TOTAL CURRENT LIABILITIES 1,731,632 2,046,544
---------- -----------
NOTES AND MORTGAGES PAYABLE 1,112,891 1,442,470
----------- -----------
OTHER LIABILITIES 474,877 486,404
----------- -----------
STOCKHOLDERS' EQUITY:
Capital stock - common $.01 par value,
Authorized 15,000,000 shares, Issued
and outstanding 4,488,162
and 4,488,369 respectively 44,882 44,884
Additional paid-in capital 32,304,487 32,304,485
Accumulated deficit (18,143,247) (18,924,052)
----------- -----------
TOTAL STOCKHOLDERS' EQUITY 14,206,122 13,425,317
----------- -----------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $17,525,522 $17,400,735
=========== ===========
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE>
CHEFS INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
NINE MONTHS ENDED THREE MONTHS ENDED
----------------- ------------------
OCTOBER 31, 1999 OCTOBER 25, 1998 OCTOBER 31, 1999 OCTOBER 25, 1998
---------------- ---------------- ---------------- -----------------
<S> <C> <C> <C> <C>
SALES $ 14,640,834 $ 15,213,143 $ 4,661,434 $ 5,218,873
COST OF GOODS SOLD 4,755,477 5,000,752 1,544,669 1,744,395
------------- ------------ ------------ ------------
GROSS PROFIT 9,885,357 10,212,391 3,116,765 3,474,478
------------- ------------ ------------ ------------
OPERATING EXPENSES:
Payroll and related expenses 4,126,368 4,362,161 1,332,337 1,452,851
Other operating expenses 2,838,634 3,130,031 911,529 1,029,865
Depreciation and amortization 758,698 762,804 252,353 256,723
General and administrative expenses 1,358,433 1,344,321 439,938 453,960
Gain on sale of asset (13,947) --- --- ---
------------- ------------ ------------ ------------
TOTAL OPERATING EXPENSES 9,068,186 9,599,317 2,936,157 3,193,399
------------- ------------ ------------ ------------
INCOME FROM OPERATIONS 817,171 613,074 180,608 281,079
------------- ------------ ------------ ------------
OTHER INCOME (EXPENSE):
Interest expense (108,536) (84,391) (31,444) (22,104)
Interest income 118,670 98,689 48,230 32,182
------------- ------------ ------------ ------------
OTHER INCOME, NET 10,134 14,298 16,786 10,078
------------- ------------ ------------ ------------
INCOME BEFORE INCOME TAXES 827,305 627,372 197,394 291,157
PROVISION FOR INCOME TAXES 46,500 --- 19,600 ---
------------- ------------ ------------ ------------
NET INCOME $ 780,805 $ 627,372 $ 177,794 $ 291,157
========= =========== ========= =========
BASIC INCOME PER COMMON SHARE $ .17 $ .14 .04 $ .06
============= ============ ============= =============
Number of shares outstanding 4,488,162 4,488,461 4,488,162 4,488,461
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE>
CHEFS INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
NINE MONTHS ENDED OCTOBER 31, 1999 AND OCTOBER 25, 1998 (Unaudited)
<TABLE>
<CAPTION>
1999 1998
---- ----
<S> <C> <C>
OPERATING ACTIVITIES:
Net income $ 780,805 $ 627,372
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization 758,698 762,804
Gain on sale of asset (13,947) --
Increase (decrease) in cash attributable
to changes in assets and liabilities:
Miscellaneous receivables 10,628 6,304
Inventories (35,378) 30,888
Prepaid expenses 42,920 (7,593)
Accounts payable (107,895) (384,073)
Accrued expenses and other liabilities (10,746) 101,873
Income taxes payable 15,674 --
----------- -----------
Total Adjustments 659,954 510,203
----------- -----------
NET CASH PROVIDED BY OPERATING ACTIVITIES 1,440,759 1,137,575
----------- -----------
INVESTING ACTIVITIES:
Capital expenditures (306,341) (766,686)
Net proceeds from sale of asset 148,947 --
Sale or redemption of investments 300,000 96,000
Purchase of investments (341,000) (100,000)
Proceeds from notes receivable -
discontinued operations - related party 50,699 259,000
Other assets (12,285) (97,142)
----------- -----------
NET CASH USED IN INVESTING ACTIVITIES (159,980) (608,828)
----------- -----------
FINANCING ACTIVITIES:
Repayment of debt (553,051) (721,310)
Proceeds from debt -- 124,000
----------- -----------
NET CASH USED IN FINANCING ACTIVITIES (553,051) (597,310)
----------- -----------
NET INCREASE IN CASH AND
CASH EQUIVALENTS 727,728 (68,563)
CASH AND CASH EQUIVALENTS at beginning 871,950 1,136,063
----------- -----------
CASH AND CASH EQUIVALENTS at end $ 1,599,678 $ 1,067,500
=========== ===========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Interest paid $ 99,013 $ 80,707
=========== ===========
Income taxes paid $ 35,951 $ --
=========== ===========
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE>
CHEFS INTERNATIONAL, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
NOTE 1: BASIS OF PRESENTATION
---------------------
The accompanying financial statements have been prepared by Chefs
International, Inc. (the "Company") and are unaudited. In the opinion of the
Company's management, all adjustments (consisting solely of normal recurring
adjustments) necessary to present fairly the Company's consolidated financial
position, results of operations and cash flows for the periods presented have
been made. Certain information and footnote disclosures required under generally
accepted accounting principles have been condensed or omitted from the
consolidated financial statements pursuant to the rules and regulations of the
SEC. The consolidated financial statements and notes thereto should be read in
conjunction with the Company's audited consolidated financial statements for the
year ended January 31, 1999 and notes thereto included in the Company's Annual
Report on Form 10-KSB filed with the SEC. The results of operations and the cash
flows for the three and nine month periods ended presented in the consolidated
financial statements are not necessarily indicative of the results to be
expected for any other interim period or the entire fiscal year.
NOTE 2: EARNINGS PER SHARE
------------------
Basic earnings per share is computed using the weighted average number
of shares of common stock outstanding during the period.
NOTE 3: INCOME TAXES
------------
At October 31,1999, the Company had net deferred tax assets of
approximately $3,178,000 arising principally from net operating loss
carryforwards. However, due to the uncertainty that the Company will generate
sufficient income in the future to fully or partially utilize these
carryforwards, an allowance of $3,178,000 has been established to offset these
assets.
NOTE 4: DUE ON SALE OF DISCONTINUED OPERATIONS FROM RELATED PARTY
---------------------------------------------------------
On February 20, 1997 (as of January 26, 1997), the Company sold 95% of
the common stock of Mr. Cookie Face ("MCF"), its ice cream production segment,
to a former director for an aggregate purchase price of $1,600,000, consisting
of a $500,000 cash payment and three notes totaling $1,100,000. The first note
(Note A) for $100,000 was due on or before March 24, 1997 and was paid in full
on a timely basis. The second note (Note B) for $500,000 is due in installments
through July 1, 2000, and the third note (Note C) for $500,000 is due on or
before February 20, 2004, with mandatory prepayments based on MCF's cash flow.
The notes are secured by a first lien on all of MCF's assets, however, the
Company has agreed to subordinate the notes up to $1,750,000 of additional
financing for MCF. Based on the estimated present value of the payments,
management recorded a valuation allowance of $601,050 against the second and
third notes. During fiscal 1999, MCF requested a restructuring of the terms of
the second and third notes. During the quarter ended October 31, 1999, the
Company's Board of Directors ("Board") was advised by MCF that MCF had achieved
a positive cash flow during its second quarter and pursuant to the requirements
of Note C, owed the Company approximately $41,800 in interest. The Board agreed
to allow MCF to make monthly payments of the said Note C interest amount with
the final payment due June 1, 2000. Additionally, the Board agreed to allow MCF
to continue making monthly partial payments on Note B and will address a formal
restructuring of all MCF debt by July 2000.
<PAGE>
Cash receipts for these notes are applied to principal and interest
based on the discounted note payment schedules, which resulted in an additional
$19,900 of interest income being recognized during the nine months ended October
31, 1999. During the quarter ended October 31, 1999, MCF paid $5,000 in interest
on Note C to the Company. The 5% of MCF capital stock retained by the Company
has been valued at $35,000.
<PAGE>
CHEFS INTERNATIONAL, INC. AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS (Unaudited)
SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995
- --------------------------------------------------------------------------------
Certain statements regarding future performance in this
Quarterly Report on Form 10-QSB constitute forward-looking statements under the
Private Securities Litigation Reform Act of 1995. No assurance can be given that
the future results covered by the forward-looking statements will be achieved.
The Company cautions readers that important factors may affect the Company's
actual results and could cause those results to differ materially from the
forward-looking statements. Such factors include, but are not limited to,
changing market conditions, weather, the state of the economy, the impact of
competition to the Company's restaurants, pricing and acceptance of the
Company's food products.
OVERVIEW
- --------
The Company's principal source of revenue is from the operations of
its restaurants. The Company's cost of sales includes food and liquor costs.
Operating expenses include labor costs, supplies and occupancy costs (rent and
utilities), marketing and maintenance costs. General and administrative expenses
include costs incurred for corporate support and administration, including the
salaries and related expenses of personnel and the costs of operating the
corporate office at the Company's headquarters in Point Pleasant Beach, New
Jersey.
The Company currently operates eight restaurants on a year-round
basis. Seven of the restaurants are free-standing seafood restaurants in New
Jersey and Florida and are operated under the names "Lobster Shanty" or "Baker's
Wharfside." The other restaurant is a Mexican theme restaurant in New Jersey
operated under the name "Garcia's." The Company opened its first seafood
restaurant in November 1978 and opened its Garcia's restaurant in April 1996.
Generally, the Company's New Jersey seafood restaurants derive a
significant portion of their sales from May through September. The Company's
Florida seafood restaurants derive a significant portion of their sales from
January through April. The Company's Garcia's restaurant derives a significant
portion of its sales during the holiday season from Thanksgiving through
Christmas.
At the end of the third quarter for the fiscal year ended January 31,
1999, the Company closed its Belmar, New Jersey Lobster Shanty restaurant due to
unsatisfactory operating results. The Company operated nine restaurants,
including the Belmar Lobster Shanty, during the nine months ended October 25,
1998.
RESULTS OF OPERATIONS
- ---------------------
SALES.
Sales for the nine months ended October 31, 1999 were $14,640,800, a
decrease of $572,300 or 3.8%, as compared to $15,213,100 for the nine months
ended October 25, 1998. For the third quarter ended October 31, 1999, sales were
$4,661,400, a decrease of $557,500 or 10.7%, as compared to last year's third
quarter. The now closed Belmar Lobster Shanty had sales of $960,100 and $360,500
for the nine and three month periods of last year. Accordingly, sales for the
restaurants that operated during the comparable periods increased $387,800 or
2.7% for nine months
<PAGE>
and decreased by $197,000 or 4.1% for the third quarter of this year. The
year-to-date improvement can be attributed to a mild winter and unusually dry
summer in New Jersey. The decrease in sales for the third quarter resulted from
the inclusion of different calendar weeks in the fiscal comparisons. This year's
third quarter included the 13 weeks between August 2, 1999 and October 31, 1999,
while last year's third quarter included the 13 weeks between July 27, 1998 and
October 25, 1998, resulting in a decrease in sales of approximately $250,000.
The number of customers served in the eight restaurants increased by .5% for the
nine months and decreased by 4.3% for the third quarter, while the average check
paid per customer increased this year by 2.3% and .3% for the respective nine
and three month periods.
GROSS PROFIT; GROSS MARGIN.
Gross profit was $9,885,400 or 67.5% of sales for the nine month
period and $3,116,800 or 66.9% of sales for the quarter ended October 31, 1999
compared to $10,212,400 or 67.1% and $3,474,500 or 66.6% for the comparable
periods of fiscal 1999. The increase in gross profit and gross margin reflects
lower food costs, primarily lower dairy and shrimp costs, and the closure of the
Belmar restaurant, which had a lower gross profit margin than the combined
results of the other eight restaurants.
OPERATING EXPENSES.
Total operating expenses decreased by 5.5% from $9,599,300 during the
first nine months of fiscal 1999 to $9,068,200 during the first nine months of
fiscal 2000, and by 8.1% from $3,193,400 during the third quarter of fiscal 1999
to $2,936,200 during the third quarter of fiscal 2000. Included in total
operating expenses are payroll and related expenses which totaled 28.2% of sales
for the nine months and 28.6% for the third quarter of fiscal 2000, compared to
28.7% and 27.8% respectively for the comparable periods of fiscal 1999. The
decrease in payroll and related expenses as a % of sales for the nine months is
primarily attributable to the increase in sales and the closure of the Belmar
restaurant with its higher payroll costs. The increase for the third quarter is
primarily related to the sales decrease. Other operating expenses decreased by
approximately $291,400 for the nine months ended October 31, 1999. This decrease
is attributable to the Vero Beach, Florida restaurant, which was previously
rented at $10,000 per month, and was purchased during the fourth quarter last
year, and the closure of the Belmar restaurant. Depreciation and amortization
expenses were essentially unchanged from last year. General and administrative
expenses increased $14,100 for the nine month period and decreased by $14,100
for the three month period ended October 31, 1999 versus last year. Higher
salaries and payroll taxes and group health insurance costs account for the
majority of the increase, offset by lower worker's compensation costs during the
third quarter of the current year.
During the quarter ended August 1, 1999, the Belmar Lobster Shanty
liquor license was sold to an unaffiliated buyer for $150,000 cash resulting in
a gain of $13,900.
OTHER INCOME AND EXPENSE.
Interest expense increased $24,100 and $9,300 for the nine and three
month periods ended October 31, 1999 as compared to the comparable periods last
year. This increase was primarily the result of the interest expenses associated
with a $880,000 first mortgage used to partially fund the Vero Beach Lobster
Shanty restaurant purchase and with a $124,000 loan used to partially fund the
purchase of a property next to the Toms River, New Jersey Lobster Shanty
restaurant. Interest income increased $20,000 and $16,000 for the nine and three
month periods ended October 31, 1999 as compared to the comparable periods last
year. This increase was primarily a result of additional interest income
associated with notes receivable from the February 1997 sale of discontinued
operations (see note 4.)
<PAGE>
NET INCOME.
Net income was $780,800 or $.17 per share for the nine months and
$177,800 or $.04 per share for the quarter ended October 31, 1999 as compared to
$627,400 or $.14 per share and $291,200 or $.06 per share for the comparable
periods last year.
LIQUIDITY AND CAPITAL RESOURCES
- -------------------------------
The Company has financed its operations principally from revenues
derived from its restaurants.
The Company's ratio of current assets to current liabilities was
1.78:1 at October 31, 1999 compared to 1.32:1 at the year ended January 31,
1999. Working capital was $1,353,300 at October 31, 1999 compared to $653,200 at
the year-end, an increase of $700,100. During the nine months ended October 31,
1999, net cash increased by $727,700. The primary components of this year's cash
flow statement were net income of $780,800, the sale of the Belmar liquor
license for $150,000, a decrease in accounts payable of $107,900, capital
expenditures of $306,300 for routine restaurant improvements and debt repayment
of $553,100. During the corresponding nine month period in fiscal 1999 working
capital increased by $588,200 and net cash decreased by $68,600. The primary
components of last years's cash flow statement were net income of $627,400, an
increase in accrued expenses of $101,900 due primarily to legal costs, capital
expenditures of approximately $766,700, primarily at the Toms River restaurant
and debt repayment of $721,300.
During the second quarter of the current fiscal year the Company's
$500,000 bank line of credit was renewed for another year. The interest rate on
the line is variable, equal to the monthly fluctuating LIBOR rate plus 2.25%.
The entire $500,000 is currently available for use.
Management believes that funds from operations and its $500,000 bank
line of credit will be sufficient to meet obligations for the balance of fiscal
2000, including projected capital expenditures of $175,000 in addition to those
expenditures incurred during the first nine months. The projected capital
expenditures include approximately $50,000 for Year 2000 ("Y2K") expenses, which
are expected to be incurred during the fourth quarter.
The Company's future capital requirements and the adequacy of
available funds will depend on numerous factors, including changing market
conditions, weather, the state of the economy, the impact of competition to the
Company's restaurants, pricing and acceptance of the Company's food products. To
the extent that funds generated from the Company's operations, together with its
existing capital resources (including its credit facility), and the net interest
earned thereon, are insufficient to meet current or planned operating
requirements, the Company will be required to obtain additional funds through
equity or debt financing, or through other sources. The terms of any equity
financing may be dilutive to stockholders and the terms of any debt financing
may contain restrictive covenants, which limit the Company's ability to pursue
certain courses of action. The Company does not have any committed sources of
additional financing beyond that described above, and there can be no assurance
that additional funding, if necessary, will be available on acceptable terms, if
at all. If adequate funds are not available, the Company's business, financial
condition and results of operations could be materially and adversely affected.
YEAR 2000.
Commencing in 1997, the Company began a review of its restaurant and
corporate computer systems to identify potential problems with the Y2K issue. As
a result of that review, it was determined that certain systems would require
remediation, specifically, the corporate mainframe computer, various restaurant
point of sale systems ("POS") and personal computers ("PC"s) used throughout the
Company.
<PAGE>
At October 31, 1999, the Company was at various stages of completion
of the remediation process. The mainframe software programming changes were
completed and successfully tested in May 1999. Mainframe Y2K software
expenditures to date have not been material and have been expensed as incurred.
The restaurant POS remediation process, including those systems not affected by
Y2K issues, is 88% compliant and the last system is expected to be made Y2K
compliant in December 1999. It is anticipated that the cost of such fixes will
not be material and will be funded from operating cash flows. Additionally, the
Company is at the final stage of the process of replacing the non-compliant PCs
and software. Most of the new PCs have been installed and it is anticipated that
the balance will be installed sometime prior to the end of December 1999 and the
cost estimate for the entire project has been increased to $70,000, which will
also be funded out of operating cash flows.
The Company has been in contact with its various suppliers of goods
and services regarding their compliance with Y2K issues. To date, several key
vendors such as payroll / human resources, credit card processors, the major
food and liquor vendors, and various public utility companies have indicated
that they are or will be compliant. At least 50% of the remaining vendors
contacted have indicated in writing that they will be Y2K compliant or that they
will not be affected. Although the Company is unable to verify the Y2K readiness
of all third party vendors, the Company believes that there are multiple vendors
for the goods and services it receives from its suppliers and that the risk of
non-compliance with Y2K by any of its suppliers is minimal.
Considering the substantial progress made to date, the Company does
not anticipate delays in finalizing internal Y2K remediation within the
remaining time schedules. There can be no assurances, however, that the
Company's internal systems or those of a third party on which the Company relies
will be Y2K compliant by the year 2000. An interruption of the Company's ability
to conduct its business due to a Y2K readiness problem could have a material
adverse effect on the Company, its operations, financial condition and
liquidity.
Pending the results of the Company's review of the Y2K preparedness of
its critical third parties, the Company will then determine what course of
action and contingencies will need to be made, if any.
INFLATION.
It is not possible for the Company to predict with any accuracy the
effect of inflation upon the results of its operations in future years. The
price of food is extremely volatile and future projections vary and are
dependent upon a complex set of factors.
<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.
CHEFS INTERNATIONAL, INC.
/S/ ANTHONY C. PAPALIA
- ----------------------
ANTHONY C. PAPALIA
Principal Executive and Financial Officer
DATED: December 13, 1999
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
financial statements of Chefs International, Inc. and Subsidiaries included in
the Company's Form 10-QSB for the nine months ended October 31, 1999, and is
qualified in its entirety by reference to such financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> JAN-30-2000
<PERIOD-START> FEB-1-1999
<PERIOD-END> OCT-31-1999
<CASH> 1,599,678
<SECURITIES> 0
<RECEIVABLES> 60,650
<ALLOWANCES> 0
<INVENTORY> 1,031,025
<CURRENT-ASSETS> 3,084,886
<PP&E> 20,054,072
<DEPRECIATION> 8,047,122
<TOTAL-ASSETS> 17,525,522
<CURRENT-LIABILITIES> 1,731,632
<BONDS> 0
0
0
<COMMON> 44,884
<OTHER-SE> 14,161,238
<TOTAL-LIABILITY-AND-EQUITY> 17,525,522
<SALES> 14,640,834
<TOTAL-REVENUES> 14,773,451
<CGS> 4,755,477
<TOTAL-COSTS> 13,837,610
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 108,536
<INCOME-PRETAX> 827,305
<INCOME-TAX> 46,500
<INCOME-CONTINUING> 780,805
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 780,805
<EPS-BASIC> 0.17
<EPS-DILUTED> 0.17
</TABLE>
