For the fiscal year ended June 30, 2000

[ ] 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 1-11754

Piccadilly Cafeterias, Inc.
(Exact name of registrant as specified in its charter)

3232 Sherwood Forest Blvd., Baton Rouge, Louisiana 70816
(Address of principal executive offices) (Zip Code)

Registrant's telephone number, including area code (225) 293-9440

Securities registered pursuant to Section 12(b) of the Act:

Securities registered pursuant to Section 12(g) of the Act:
None
(Title of class)

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 [ ]

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [X]

The aggregate market value of the voting stock held by non-affiliates of the registrant based on the closing price of such stock on September 8, 2000 was $23,042,000.

The number of shares outstanding of Common Stock, without par value, as of September 8, 2000 was 10,528,368.

Portions of the Annual Report to Shareholders for the fiscal year ended June 30, 2000 are incorporated by reference into Part II.

Portions of the definitive proxy statement for the 2000 annual meeting of shareholders are incorporated by reference into Part III.

Piccadilly Cafeterias, Inc. (the "Company") hereby amends and supplements the following items of its Annual Report on Form 10-K for the year ended June 30, 2000, to read in their entirety as follows:

Piccadilly Cafeterias, Inc., founded in 1944, is the largest cafeteria chain in the United States with 238 cafeterias in 16 states. We are the dominant cafeteria chain in the Southeastern and Mid-Atlantic regions. We serve a diverse and extremely loyal customer base consisting of families, groups of friends and co-workers, senior citizens, couples and students. Our patrons enjoy a wide selection of convenient, healthy, freshly prepared "home cooked" meals at value-oriented prices for lunch and dinner. We have generated consistent EBITDA over the past five years, with our EBITDA increasing from $24.0 million in fiscal 1996 to $26.7 million in fiscal 2000.

We expect to achieve significant annual cost savings through outsourcing certain food preparation activities and expanding our centralized purchasing. We have successfully implemented outsourcing at 54 of our cafeterias and we intend to roll out this program to our remaining cafeterias during the next two years. We expect this program will result in approximately $2.5 million of cost savings for fiscal 2001. When our outsourcing program is fully implemented, we expect to reduce annual operating expenses by approximately $8 to $10 million. We also expect to save approximately $3 million of annual operating expenses by expanding our centralized purchasing program to include certain food items, such as poultry, that are currently being purchased by the individual cafeteria managers.

In addition, we expect to generate significant incremental EBITDA through our recent acquisition of 142 Morrison cafeterias. Although Morrison cafeterias were experiencing declines in same-store sales prior to the acquisition, we acquired the Morrison cafeterias in May 1998 as a long-term growth strategy. Specifically, the acquisition more than doubled Piccadilly's size, eliminated a major competitor and provided significant upside potential through the improvement of the Morrison operations. We have addressed the declining trends in same-store sales at the Morrison cafeterias during fiscal 1999 and 2000 by (i) closing 27 unprofitable cafeterias, (ii) converting 112 Morrison cafeterias to Piccadilly-style cafeterias and (iii) implementing new marketing programs.

As used herein, EBITDA is net income before provision for income taxes, gain from sale of Ralph & Kacoo's, interest expense, provision for cafeterias impairments and closings and depreciation and amortization. EBITDA should not be considered as an alternative to, or more meaningful than, income before income taxes, cash flow from operating activities or other traditional indicators of operating performance. Rather, EBITDA is presented because it is a widely accepted supplemental financial measure that we believe provides relevant and useful information. Our calculation of EBITDA may not be comparable to a similarly titled measure reported by other companies, since all companies do not calculate this non-GAAP measure in the same manner.

Dominant Market Share in Core Markets. We are the largest cafeteria chain in the United States with 238 cafeterias, and we are the dominant cafeteria chain in the Southeastern and Mid-Atlantic regions. The next largest cafeteria chain in these regions operates 32 cafeterias. Although the family dining industry is very competitive and has grown significantly through the introduction of new restaurant concepts and new restaurant openings, the cafeteria segment has had few new entrants. In addition, the existing major cafeteria chains have generally focused on their existing regional markets. As a result, we have experienced limited competition in our markets for customers seeking a cafeteria-style dining experience.

Diverse and Extremely Loyal Customer Base. We have developed substantial brand equity and customer loyalty during our 56-year operating history. In addition, we have developed a diverse customer base consisting of families, groups of friends and co-workers, senior citizens, couples and students. We believe cafeteria dining meets changing lifestyle needs by providing convenient, healthy, freshly prepared and reasonably-priced meals that combine the ease of fast food with the quality of home cooking. We attribute our broad market appeal and customer loyalty to the consistent quality of our meals, our varying menu selection, convenient cafeteria format, value pricing and well-recognized brand name. Our high level of repeat business allows us to minimize advertising costs and reduces our exposure to competition from new restaurant openings in our markets.

High Quality Food Offering. Our food quality, service and atmosphere were all voted #1 among cafeterias and buffet-style chains by consumers in Restaurants and Institutions' "Choice in Chains" 2000 survey. All of our cafeterias offer a wide variety of quality, reasonably-priced meals. Our standard menu offering includes soups, salads, seafood, meat, chicken, vegetables, breads, desserts and beverages. Each of our cafeteria managers has the ability to vary their menu to include local and seasonal favorites from our extensive proprietary recipe files. Our typical cafeteria lines offer a wide food selection including up to 18 entrees, 2 soups, 20 salads, 18 vegetables, 7 breads and 22 desserts. Customers make their meal selections by combining these items according to their individual preferences.

Solid Market Position. Since 1990, eating places revenues have increased at a compound annual growth rate of 5.0% per year to $241.1 billion in 1999. This increase was initially accompanied by the introduction of a significant number of new restaurant concepts and rapid new-restaurant expansion. As a result, the restaurant market has become oversaturated and recently the pace of new-restaurant openings has slowed. Many restaurant chains are now focused on improving sales and profitability at their existing restaurants. During this highly competitive period, we have sustained our operations and maintained a consistent level of EBITDA. Furthermore, with our 238 cafeterias we are well positioned to increase our sales in the current environment of slower new-restaurant growth and continued increases in consumer demand for restaurant dining.

Proven Management with Significant Equity Stake. Our executive officers average over 22 years of experience at Piccadilly. In addition, our district and cafeteria managers have an average of 23 and 17 years of experience at Piccadilly, respectively. As a result, our management team is extremely familiar with our existing markets and customer base. Mr. Ronald A. LaBorde, our Chief Executive Officer, has served us for over 18 years, and has been our chief executive officer since 1995. Our management team currently beneficially owns approximately 7.6% of the outstanding shares of our Company, including shares subject to exercisable options, and our founders and their beneficiaries beneficially own approximately 19.2% of the outstanding shares of our Company.

Capitalize on the Morrison Acquisition. In May 1998, Piccadilly acquired 142 Morrison cafeterias, at that time the largest cafeteria chain in the Southeastern and Mid-Atlantic regions of the United States. While the Morrison cafeteria operations had been experiencing declining operations for two years prior to the acquisition, we believed that the acquisition would ultimately be accretive to our operations. Specifically, the acquisition allowed us to eliminate our only major competitor in our markets, more than double the size of our operations, enhance purchasing power, eliminate redundant costs and potentially increase sales at Morrison cafeterias to Piccadilly levels. In fiscal 2000, the Morrison cafeterias contributed only $0.9 million of EBITDA. During that same time period, Morrison cafeterias on average generated only $1.6 million of sales per cafeteria compared to $2.2 million of sales at our traditional Piccadilly cafeterias. We believe that we can substantially increase Morrison EBITDA based on our experience with the traditional Piccadilly cafeterias.

Implement Sales-Building Initiatives. In fiscal 2000, same-store sales declined by 5.2%. Approximately 73% of the declines in same-store sales was attributable to the Morrison cafeterias. During fiscal 1999 and 2000, we were focused on the integration of the Morrison cafeterias. Specifically, during fiscal 1999 and the first quarter of fiscal 2000, we closed 27 unprofitable Morrison cafeterias and converted 112 Morrison cafeterias to Piccadilly-style cafeterias. During the balance of fiscal 2000, we tested several sales-building initiatives at 16 cafeteria locations in order to attract and retain new customers and to increase sales to existing customers. These sales-building initiatives included direct mail marketing and employee incentive programs. These initiatives have been well received by our customers. As a result of these programs, we have experienced a consistent trend of year-over-year sales improvement at these 16 cafeterias, from a decline in monthly sales of 14% in January 2000 to an increase of 6% in September 2000. Due to favorable results at the test cafeterias, we implemented these initiatives on a Company-wide basis in September 2000.

Implement Outsourcing Program. We have historically prepared almost all of our meals from scratch at each cafeteria location. We recently initiated an outsourcing program at 54 of our cafeterias, in which outside vendors prepare and provide selected components of our recipes. For example, the cafeterias will receive certain pre-cut vegetables for salads and entrees, pre-mixed ingredients for certain desserts and side items based on our proprietary receipes and pre-mixed dough for selected bakery products. The outsourcing program has been implemented carefully in order to maintain consistently high levels of food freshness and quality. Based on our experience at these 54 cafeterias, we expect to reduce annual operating expenses by between approximately $8 and $10 million when the outsourcing program is fully implemented. These savings are the result of significantly reduced kitchen labor hours. We intend to roll out the outsourcing program to our remaining cafeterias over the next two years. We expect to achieve $2.5 million of cost savings in fiscal 2001 from our outsourcing program.

Expand Centralized Purchasing Program. Currently, the managers at each of our cafeterias have purchasing responsibility for approximately one-third of the food ingredients used in the meals we serve. We implemented a new program in September 2000 that eliminated over 100 poultry suppliers by centralizing the purchasing function for poultry. Over the next 12 to 15 months, we expect to centralize the purchasing of other food items. Through centralized purchasing, we expect to achieve significant volume purchase discounts, resulting in approximately $3 million of annual cost savings ($1.5 million in fiscal 2001 from poultry alone). In addition, centralized purchasing will allow our cafeteria managers to spend more of their time increasing sales and enhancing customer service.

Our traditional cafeterias average approximately 10,000 square feet in size and seat approximately 350 customers. During 1997, the Company completed the design of a different cafeteria model, which has approximately 7,500 square feet and seats between 165 to 200 customers. This smaller cafeteria allows the Company to access a broader range of markets at a lower investment cost. As of September 30, 2000, we have opened 10 new cafeterias utilizing this new design and format.

Food Items. Our food quality, service and atmosphere were all voted #1 among cafeterias and buffet-style chains by consumers in Restaurants and Institutions' "Choice in Chains" 2000 survey. All of our cafeterias offer a wide variety of quality, reasonably-priced meals. Our standard menu offering includes soups, salads, seafood, meat, chicken, vegetables, breads, desserts and beverages. Each of our cafeteria managers has the ability to vary their menu to include local and seasonal favorites from our extensive proprietary recipe files. Our typical cafeteria lines offer a wide food selection including up to 18 entrees, 2 soups, 20 salads, 18 vegetables, 7 breads and 22 desserts. Customers make their meal selections by combining these items according to their individual preferences.

Pricing. Historically, we have sold most meals as "bundled" meals that included side items and beverages, although customers have also been able to purchase meals on an a la carte basis. We continuously evaluate our meal pricing structure to assure that we deliver value-oriented meals to our customers. As part of that process, during fiscal 2000, we experimented with alternative bundled meal pricing programs. The most recent version of this program was successfully tested at 10% of our cafeterias through August 2000. This program provides a progression of price-points from approximately $5 to $9 per meal. Each meal includes an entree, two side orders, and a bread selection. For example, popular items like southern fried chicken, fried catfish, and chopped beef are available at the $5 price point while other more expensive items such as steaks, our popular crawfish étouffée and other seafood dishes are available at the $8 and $9 price points. Although the program attempts to focus the customer on the value received in a bundled meal, customers may still purchase items on an a la carte basis. Since implementation of this program, customer response has been positive and check averages have remained constant. We intend to continue to phase in this new program at our other cafeteria locations, while continuing to gather customer feedback and analyzing sales information.

In fiscal 1999 and 2000, our advertising spending has been approximately $6 to $7 million per year and has focused primarily on television and radio spots and some direct marketing. We believe that the majority of our sales come from customers living or working within three to five miles of our cafeterias. In order to better reach our target population, we intend to maintain our advertising budget at historical levels while altering the emphasis of our spending. As a result, in August 2000 we adopted new sales-building initiatives that consist primarily of the following:

Neighborhood marketing. This program focuses on direct mailings and newspaper inserts, seeking to increase customer traffic by increasing local awareness of our cafeterias, and may include purchase discounts and coupons.

Employee contests. We hold regular sales contests among our managers and employees at all of our cafeteria locations to enhance morale and improve cafeteria sales. We believe these contests have the added benefit of improving productivity and efficiency in our cafeteria operations as well.

Selective broadcast marketing. We intend to selectively use some television and radio advertising in our markets where we have a significant concentration of cafeterias and where the potential exists for significant increases in customer traffic as a result of these advertisements.

Dining experience. In addition to our general advertising, we believe that providing our patrons with a pleasant and enjoyable dining experience will result in return visits and word-of-mouth advertising. We recently initiated an employee training program emphasizing a clean environment, customer hospitality, and quality food.

Under our new outsourcing program, outside vendors have begun to prepare and provide selected components of our recipes. For example, the cafeterias will receive certain pre-cut vegetables for salads and entrees, pre-mixed ingredient for certain desserts and side items based on our proprietary recipes and pre-mixed dough for selected bakery products. Suppliers are responsible for many of the mixing and cooking duties associated with meal preparation and for delivering purchased items to our distributor. The outsourcing program has been implemented carefully in order to maintain consistently high levels of food freshness and quality. We expect that our new outsourcing program will significantly reduce our operating expenses, primarily as a result of significantly reduced kitchen labor costs, as well as reducing food spoilage and waste and capital expenditures for kitchen equipment. We initially tested this program at 14 cafeterias where we saved approximately $34,000 of operating expenses per month. We have recently implemented this program at 40 additional cafeterias and intend to roll out this program to our remaining cafeterias during the next two years. We expect this program will result in approximately $2.5 million of cost savings for fiscal 2001. When fully implemented, we expect to reduce annual operating expenses by between approximately $8 and $10 million through this outsourcing program.

Currently, purchasing decisions for approximately one-third of the food ingredients used in the meals served at our cafeterias is under the control of the cafeteria managers, each of whom has the freedom to negotiate with local or regional suppliers for that particular cafeteria, subject to meeting quality specifications. We implemented a new program in September 2000 that eliminated over 100 poultry suppliers by centralizing the purchasing function for poultry. Over the next 12 to 15 months, we expect to centralize the purchasing of other food items. Through centralized purchasing, we expect to achieve significant volume purchase discounts, resulting in approximately $3 million of annual cost savings ($1.5 million in fiscal 2001 from poultry alone). In addition, centralized purchasing will allow our cafeteria managers to spend more of their time increasing sales and enhancing customer service.

We currently obtain approximately two-thirds of all of our food orders through one distributor located in Baton Rouge, Louisiana. The remaining food items are purchased from local suppliers and delivered directly to our cafeterias. With the implementation of centralized food purchasing and our increasing reliance on outsourcing of some food preparation, we may increase our shipments through this distributor and, if necessary, use additional national or regional distributors. We believe that there are numerous other distributors available to process our shipments should these distributors be unable to meet our distribution needs.

As of September 30, 2000, we had approximately 11,100 employees, of whom all but about 100 corporate headquarters employees worked at Piccadilly's 238 cafeterias. On average, each cafeteria operates with three to four managers and assistant managers and employs 50 to 60 employees. Most cafeteria employees are paid on an hourly basis, except cafeteria managers. Our employees are not unionized. We have never experienced any significant work stoppages and believe that our employee relations are good.

Wages we pay our employees have increased in recent years due to the expanding economy, a tight labor market and increases in the federally mandated minimum wage. In mid-1999 we adopted a "tip-credit wage" program designed to offset wage increases for dining room personnel. Under this program, dining room employees are increasingly dependent on customer tips for a significant portion of their hourly compensation, instead of wages paid by us. This program has helped reduce our labor costs as a percent of net sales. Historically we have been able to offset wage cost increases through increased efficiencies in operations and, as necessary, through retail price increases although there can be no assurance that we will continue to be able to do so in the future.

The food service industry is highly competitive and affected by external changes such as economic conditions, disposable income, consumer tastes, and changing population and demographics. Competitive factors include: food quality, variety and price; customer service; location; the number and proximity of competitors; décor; and public reputation. We consider our principal competitors to be other cafeterias, family dining venues, and fast-food operations. Like other food service operations, we follow changes in both consumer preferences for food and habits in patronizing eating establishments.

Our cafeterias operate principally under the Piccadilly Cafeterias name and service mark, which is registered with the United States Patent and Trademark Office for a term presently expiring in January 2009. Registered service marks may continually be renewed for 10 year periods. We also have a proprietary interest in many of our recipes. We regard our service marks and trademarks as having significant value and being an important factor in the development of the Piccadilly concept. Our policy is to pursue and maintain registration of our service marks and trademarks whenever possible and to oppose vigorously any infringement or dilution of our service marks and trademarks.

Each of the cafeterias operated by the Company is subject to licensing and regulation by the health, sanitation, safety, building and fire agencies of the respective states and municipalities in which such cafeterias are located. A failure to comply with one or more regulations could result in the imposition of sanctions, including the closing of facilities for an indeterminate period of time, or third-party litigation, any of which could have a material adverse effect on the Company and its results of operations.

The Company also is subject to laws and regulations governing its relationships with employees, including minimum wage requirements, overtime, reporting of tip income, work and safety conditions and regulations governing employment. Because a significant number of the Company's employees are paid at rates tied to the federal minimum wage, an increase in the minimum wage would increase the Company's labor costs. An increase in the minimum wage rate or employee benefits costs could have a material adverse effect on the Company and its results of operations.

The Company's operations are also subject to federal, state and local laws and regulations relating to environmental protection, including regulation of discharges into the air and water. Under various federal, state and local laws, an owner or operator of real estate may be liable for the costs of removal or remediation of certain hazardous or toxic substances on or in such property. Such liability may be imposed without regard to whether the owner or operator knew of, or was responsible for, the presence of such hazardous or toxic substances. Although the Company is not aware of any material environmental conditions that require remediation by the Company under federal, state or local law at its properties, the Company has not conducted a comprehensive environmental review of its properties or operations and no assurance can be given that the Company has identified all of the potential environmental liabilities at its properties or that such liabilities would not have a material adverse effect on the financial condition of the Company.

Additionally, the Company's operations are regulated pursuant to state and local sanitation and public health laws. Operating cafeterias utilize electricity and natural gas, which are subject to various federal and state regulations concerning the allocation of energy. The Company's operating costs have been and will continue to be affected by increases in the cost of energy.

All of our cafeterias are located in urban and suburban areas, in a variety of strip shopping centers and malls, and free-standing buildings. We lease all of the cafeterias located in strip shopping centers and malls. Of the 94 cafeterias located in free-standing buildings, we own the building and land for 32 of the cafeterias, and the remainder are operated in Company-owned buildings located on leased land. Leases provide for monthly rentals, typically computed on the basis of a fixed amount plus a percentage of sales. Our cafeteria locations by state are as follows:

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Piccadilly's corporate headquarters occupy approximately two-thirds of a Company-owned 45,000 square foot office building completed in 1974 and located on a Company-owned tract comprising approximately five acres in Baton Rouge, Louisiana. The remainder of the building is leased to commercial tenants.

Executive officers are elected annually by the Board of Directors and hold office until a successor is duly elected. The names and positions of executive officers of the Registrant, together with a brief description of the business experience of each such person during the past five years, is set forth below.

Ronald A. LaBorde, age 44, Chairman, President and Chief Executive Officer, has been the President and Chief Executive Officer of the Company since July 1995 and has been Chairman of the Board since November 6, 2000. From January 1992 to June 1995 he was Executive Vice President, Treasurer and Chief Financial Officer.

Joseph S. Polito, age 58, Executive Vice President and General Manager, has held such positions since August 1995. From September 1992 to July 1995, he was Executive Vice President and Director of Training.

Mark L. Mestayer, age 42, Executive Vice President and Chief Financial Officer, has held such positions since September 1999. From July 1996 to September 1999, he was Executive Vice President, Secretary and Director of Finance, and from May 1992 to July 1996, he was Executive Vice President, Secretary and Controller.

(A) Deductions are for the write-off of certain property, plant and equipment relating to units closed and for the payment of other obligations (primarily rent) for those units closed and for those units for which a provision for unit closing was recorded during the years ended June 30, 1992, 1997 and 1999.

(B) Represents reserves for Morrison units which were recorded as part of the allocation of purchase price.