<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
[x] Quarterly report pursuant to Section 13 or 15(d) of the Securities and
Exchange Act of 1934
For the quarterly period ended December 30, 1995
-----------------
or
[ ] Transition report pursuant to Section 13 or 15(d) of the Securities and
Exchange Act of 1934
For the transition period from to
------------ ------------
Commission File No. 0-11271
-------
WALL STREET DELI, INC.
(Exact name of registrant as specified in its Charter)
Delaware 63-0514240
(State of Incorporation) (IRS Employer I.D. No.)
400 Century Park South, Suite 116
Birmingham, Alabama 35226
(Address of principal executive offices)
(205) 822-3960
(Registrant's telephone number)
________________________________________________________________
Indicate by check mark whether the registrant has (1) 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 the number of shares outstanding of the registrant's class of
common stock, as of the latest practicable date.
Class Outstanding at February 2, 1996
- ---------------------------- -------------------------------
Common Stock, $.05 Par Value 3,407,317
<PAGE> 2
INDEX
<TABLE>
<CAPTION>
Page No.
--------
<S> <C>
PART I: FINANCIAL INFORMATION
ITEM 1: Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Consolidated Balance Sheets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Consolidated Statements of Income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Consolidated Statements of Cash Flows . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Notes to Consolidated Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . 6
ITEM 2: Management's Discussion and Analysis of Financial
Condition and Results of Operations . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . 7
PART II: OTHER INFORMATION
ITEM 4: Submission of Matters to a Vote of Security Holders . . . . . . . . . . . . . . . . . .. . . . . . 12
ITEM 6: Exhibits and Reports on Form 8-K . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . 13
SIGNATURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . 14
EXHIBITS:
Exhibit 11: Computation of Earnings
Per Common Share . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . 15
</TABLE>
<PAGE> 3
PART I: FINANCIAL INFORMATION
ITEM I: FINANCIAL STATEMENTS
The financial statements listed below are included on the following pages of
this Report on Form 10-Q (Unaudited):
Consolidated Balance Sheets at December 30, 1995 and July 1, 1995.
Consolidated Statements of Income for the three months and six months
ended December 30, 1995 and December 31, 1994.
Consolidated Statements of Cash Flows for the six months ended
December 30, 1995, and December 31, 1994.
Notes to Consolidated Financial Statements.
______________________________________
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1
<PAGE> 4
WALL STREET DELI, INC.
CONSOLIDATED BALANCE SHEETS
(Unaudited)
<TABLE>
<CAPTION>
December 30, 1995 July 1, 1995
----------------- ------------
ASSETS
<S> <C> <C>
Current:
Cash and equivalents $ 1,439,448 $ 921,616
Accounts and notes receivable 1,659,295 2,104,109
Inventories (note 3) 1,133,113 1,060,503
Prepaid expenses 249,315 926,594
Refundable and deferred taxes 1,690,129 1,715,129
Assets held for sale 283,500 384,750
------------ ------------
Total current assets $ 6,454,800 $ 7,112,701
Equipment and improvements:
Equipment and fixtures 18,992,937 18,399,808
Leasehold improvements 16,529,233 15,463,074
------------ ------------
35,522,170 33,862,882
Less accumulated depreciation and amortization (14,481,587) (12,898,679)
------------ ------------
Net equipment and improvements 21,040,583 20,964,203
Other:
Long-term portion of notes receivable 649,573 431,151
Cash surrender value of officers'
life insurance 595,554 595,554
Deferred tax asset 60,100 60,100
------------ ------------
Total other assets 1,305,227 1,086,805
------------ ------------
$ 28,800,610 $ 29,163,709
============ ============
</TABLE>
See accompanying notes to consolidated financial statements (Unaudited).
2
<PAGE> 5
WALL STREET DELI, INC.
CONSOLIDATED BALANCE SHEETS
(Unaudited)
<TABLE>
<CAPTION>
December 30, 1995 July 1, 1995
----------------- ------------
LIABILITIES AND STOCKHOLDERS' EQUITY
<S> <C> <C>
Current liabilities:
Notes payable $ 3,150,000 $ 3,150,000
Accounts payable 1,531,611 1,873,429
Accruals 3,381,642 3,487,123
------------ ------------
Total current liabilities 8,063,253 8,510,552
Stockholders' equity:
Common stock 169,789 170,168
Additional paid-in capital 10,750,249 10,733,141
Retained earnings 9,829,998 9,760,396
------------ ------------
20,750,036 20,633,705
Less treasury stock, at cost (12,679) (10,548)
------------ ------------
Total stockholders' equity 20,737,357 20,653,157
------------ ------------
$ 28,800,610 $ 29,163,709
============ ============
</TABLE>
See accompanying notes to consolidated financial statements (Unaudited).
3
<PAGE> 6
WALL STREET DELI, INC.
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
<TABLE>
<CAPTION>
For the Three For the Six
Months Ended Months Ended
December 30, 1995 December 31, 1994 December 30, 1995 December 31, 1994
----------------- ----------------- ----------------- -----------------
<S> <C> <C> <C> <C>
Net sales $ 17,195,352 $ 16,762,711 $ 34,744,271 $ 33,597,330
Costs and expenses (income):
Costs of sales 15,692,398 14,486,872 31,684,182 28,892,862
Administrative and general expense 1,357,478 1,649,182 2,915,777 3,270,169
Interest expense 58,364 39,000 114,142 73,000
Expense (income) related to units
sold or closed 9,966 29,076 (64,434) 100,756
Other expense net: -- 2,000 -- 2,000
Total costs and expenses: 17,118,206 16,206,130 34,649,667 32,338,787
------------ ------------ ------------ ------------
Income before taxes on income 77,146 556,581 94,604 1,258,543
Taxes on income 25,000 190,000 25,000 420,000
------------ ------------ ------------ ------------
NET INCOME $ 52,146 $ 366,581 $ 69,604 $ 838,543
============ ============ ============ ============
Earnings per share $ .01 $ .11 $ .02 $ .25
============ ============ ============ ============
</TABLE>
See accompanying notes to consolidated financial statements (Unaudited).
4
<PAGE> 7
WALL STREET DELI, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
For the Six Months Ended
December 30, 1995 December 31, 1994
----------------- -----------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 69,604 $ 838,543
----------- ------------
Adjustments to reconcile net income to net cash provided by
operating activities:
Depreciation 1,912,863 1,846,830
Loss (gain) on sale of property and equipment (64,434) 45,440
Deferred income taxes 25,000 --
Decrease (increase) in assets:
Accounts receivable 531,449 (560,995)
Inventories (72,610) 110,607
Prepaid expenses 677,279 118,714
Increase (decrease) in liabilities:
Accounts payable (341,818) (112,180)
Accruals (105,481) (675,063)
----------- ------------
Net cash provided by operating activities 2,631,852 1,611,896
----------- ------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Payments for purchase of property and equipment (2,497,418) (3,032,260)
Proceeds from sale of property and equipment 234,500 80,000
Payments received on notes receivable 134,300 223,102
Increase in cash surrender value of life insurance on officers lives -- (121,906)
----------- ------------
Net cash used by investing activities (2,128,618) (2,851,064)
----------- ------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Net borrowings under line of credit -- 800,000
Purchase of treasury stock (2,131) --
Exercise of employee stock options 16,729 37,433
----------- ------------
Net cash provided by financing activities 14,598 837,433
----------- ------------
NET INCREASE (DECREASE) IN CASH FOR THE PERIOD 517,832 (401,735)
CASH, beginning of period 921,616 1,042,353
----------- ------------
CASH, end of period $ 1,439,448 $ 640,618
=========== ============
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Cash paid during the period for:
Interest $ 107,046 $ 94,215
Income taxes $ 93,500 $ 491,923
</TABLE>
See accompanying notes to consolidated financial statements (Unaudited).
5
<PAGE> 8
WALL STREET DELI, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
1. In the opinion of the Company, the accompanying unaudited consolidated
financial statements contain all adjustments (consisting of only normal
recurring accruals) necessary to present fairly the financial position as
of December 30, 1995 and the results of operations and cash flows for the
three month and six month periods ended December 30, 1995 and December 31,
1994.
2. The results of operations for the six month periods ended December 30,
1995 and December 31, 1994 are not necessarily indicative of the results
to be expected for the full year.
3. Inventories are valued at the lower of cost (first-in, first-out) or
market.
4. Earnings per common share and common share equivalent have been computed
based upon the weighted average number of shares outstanding during the
respective periods. Equivalent shares are those issuable upon assumed
exercise of stock options granted, net of shares which could have been
purchased from the proceeds based on the average market price. The
computation of earnings per common share assuming full dilution results in
less than 3% dilution during the period.
________________________________________________
6
<PAGE> 9
ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
The following is management's discussion and analysis of certain
significant factors that have affected the Company's financial condition and
earnings during the periods included in the accompanying consolidated balance
sheets and statements of income.
Results of Operations
The following table sets forth, for the periods indicated, the percentages
of net sales represented by certain items in the Company's consolidated
statements of income.
<TABLE>
<CAPTION>
For the Three Months Ended For the Six Months Ended
December 30, 1995 December 31, 1994 December 30, 1995 December 31, 1994
----------------- ----------------- ----------------- -----------------
<S> <C> <C> <C> <C>
Net sales 100.0% 100.0% 100.0% 100.0%
Cost of sales 91.3 86.4 91.2 86.0
Gross profit 8.7 13.6 8.8 14.0
Administrative and general 7.9 9.8 8.4 9.7
Operating income .8 3.8 .4 4.3
Other income (expenses),net .4 (0.4) .1 (0.5)
Income before taxes on income .4 3.4 .3 3.8
Taxes on income .1 1.1 .1 1.3
Net income .3 2.3 .2 2.5
</TABLE>
Net Sales
Net sales increased during the quarter ended December 30, 1995 by
$432,641 or 2.6% over the corresponding three months last year. Net sales also
increased by $1,146,941 or 3.4% over the corresponding six months ended
December 31, 1994. Net sales includes a decrease in same store sales of 5.5%
for the second quarter of fiscal 1996 as well as contributions from the Wall
Street Deli units opened subsequent to July 1, 1995. The sales improvement was
posted despite significantly lower sales in Washington, D.C., the Company's
largest base of stores. The decline in Washington was primarily due to the
government shutdown in December. Six units were opened during the first six
months of fiscal 1996, and eight were sold or closed during this period. In
the second quarter, four new Wall Street Deli units were opened, including two
in Chicago, Illinois, one in Washington, D.C., and one in Cincinnati, Ohio.
Six units were sold or closed in the second quarter.
Significant components of the Company's net sales and the percent of total
sales for the three months and six months ended December 30, 1995 and December
31, 1994 are presented in the following schedule:
7
<PAGE> 10
<TABLE>
<CAPTION>
For the Three Months Ended For the Six Months Ended
December 30, 1995 December 31, 1994 December 30, 1995 December 31, 1994
--------------------------- ----------------------- ---------------------- -----------------------
Net Sales % of Total Net Sales % of Total Net Sales % of Total Net Sales % of Total
---------- ----------- --------- ---------- --------- ---------- --------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Wall Street Deli $14,596,525 84.9% $13,112,204 78.2% $29,101,725 83.8% $26,389,777 78.6%
R.C. Coopers 1,722,222 10.0% 2,682,764 16.0% 3,781,655 10.9% 5,525,266 16.4%
Catering 876,605 5.1% 967,743 5.8% 1,860,891 5.3% 1,682,287 5.0%
----------- ----- ----------- ----- ----------- ----- ----------- -----
Total $17,195,352 100.0% $16,762,711 100.0% $34,744,271 100.0% $33,597,330 100.0%
=========== ===== =========== ===== =========== ===== =========== =====
</TABLE>
The Company expects the Wall Street Deli component of its sales to continue
growing, both in absolute terms and as a percentage of the Company's total
sales. Management plans to open only Wall Street Delis in the immediate future
and to continue either disposing of the R.C. Cooper units or converting them to
Wall Street Delis. The Company presently separates its sales records for the
Wall Street Deli concepts into two sub-concepts: "flagship" and "other." The
Company's average sales per unit by concept and the same store sales comparisons
for the three months and six months ended December 30, 1995 and December 31,
1994 are as follows:
<TABLE>
<CAPTION>
Average Sales Per Unit Same Store Sales
---------------------- ----------------
For the Three Months Ended
December 30, 1995 December 31, 1994 December 30, 1995 December 31, 1994
----------------- ----------------- ----------------- -----------------
<S> <C> <C> <C> <C>
Wall Street Deli Flagships $157,577 $167,855 (5.9)% 0.3%
Wall Street Deli Other 103,013 101,492 (4.6)% 3.9%
R.C. Coopers 64,803 63,293 (4.3)% 2.0%
All Units 129,537 125,758 (5.5)% 1.0%
</TABLE>
<TABLE>
<CAPTION>
Average Sales Per Unit Same Store Sales
---------------------- ----------------
For the Six Months Ended
December 30, 1995 December 31, 1994 December 30, 1995 December 31, 1994
----------------- ----------------- ----------------- -----------------
<S> <C> <C> <C> <C>
Wall Street Deli Flagships $318,987 $349,510 (7.8)% 1.6%
Wall Street Deli Other 204,150 194,855 (5.6)% 4.6%
R.C. Coopers 132,325 125,435 (3.8)% (.6)%
All Units 261,322 256,329 (7.1)% 1.5%
</TABLE>
Increases in the Company's gross sales are virtually all attributable to the
sales volume from new stores opened during the period. The Company does not
consider price changes in the products sold in the restaurants to have had a
material effect on sales in the current year or prior periods. The Company's
pricing of its food items varies slightly from store to store and city to city,
and among the different unit types. Pricing in the quick service food industry
is highly competitive, and minor adjustments in pricing from time to time, while
not believed material to sales increases or decreases,
8
<PAGE> 11
are considered necessary to remain competitive.
Overall same store sales decreased 5.5% for the quarter, versus a 1.0%
increase for this quarter last year. The Wall Street Deli flagship units did
not perform up to management's expectations; same store sales for this
significant group were down 5.9% this quarter, compared to the .3% increase
during the same quarter last year. Management believes this decrease is due in
part to increased competition in established markets as well as newer markets,
and is also reflective of overall trends in the industry.
The Company's business, particularly the sales component, is dependent
on general economic conditions. Local and national economic uncertainties, as
well as actual downturns, have in the past adversely affected sales and/or
profitability, and should be expected to have similar effects in the future.
COST OF SALES
Cost of sales as a percentage of net sales increased to 91.3% during
the three months ended December 30, 1995 from 86.5% in the corresponding
periods in the previous year. For the six months ended December 30, 1995, cost
of sales increased to 91.2% from 85.9% for the corresponding period in the
prior year.
Cost of sales consists of the following significant components:
<TABLE>
<CAPTION>
For the Three Months Ended (in thousands) For the Six Months Ended (in thousands)
December 30, 1995 December 31, 1994 December 30, 1995 December 31, 1994
----------------- ----------------- ----------------- -----------------
Amount % of Sales Amount % of Sales Amount % of Sales Amount % of Sales
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Food/Paper $ 6,006 35.0% $ 5,644 33.7% $ 12,423 35.8% $11,335 33.7%
Labor 4,083 23.7% 3,563 21.3% 8,268 23.8% 7,094 21.1%
Store Expenses 5,350 31.1% 4,813 28.7% 10,423 30.0% 9,524 28.3%
Commissary Expenses 254 1.5% 467 2.8% 570 1.6% 939 2.8%
--------- ----- -------- ----- -------- ----- ------- -----
$ 15,693 91.3% $ 14,487 86.5% $ 31,684 91.2% $28,892 85.9%
--------- ----- -------- ----- -------- ----- ------- -----
</TABLE>
The increases in food and paper costs of 1.3% and 2.1% for the three
and six month periods, respectively, resulted partially from the direct store
delivery system the Company is instituting, which will result in higher food
costs, but eventually should eliminate the commissary costs. However, higher
food costs in commissary cities also was a factor. The Company is instituting
a cost reduction plan that is designed to bring food costs back to their
historical level in the range of 33% to 34%. Commissary expenses were lower by
1.3% and 1.2% for the three and six months, respectively, partially offsetting
the increase in food costs. Labor costs also increased 2.4% and 2.7% for the
three and six months, respectively, over the corresponding periods of the
previous year. Shortly before the end of fiscal 1995 management changed the
compensation structure for store managers by raising the base pay and lowering
certain incentive pay plans. The Company's intention is to be more
9
<PAGE> 12
competitive in hiring managers but this change has raised labor costs as a
percent of sales. Management believes this program will increase sales and
that eventually labor costs, as a percent of sales, will return to
approximately the 22% level. Store expenses as a percentage of sales increased
2.4% and 1.7% for the three and six months over the corresponding periods of
the previous year. These increases were due primarily to the fixed nature of
these expenses.
PROVISION FOR ESTIMATED LOSS ON DISPOSAL OF ASSETS HELD FOR SALE
During the fourth quarter of fiscal 1995, the Company adopted a plan
designed to dispose of all its remaining commissary locations and eleven
non-performing stores. In connection therewith a provision of $1,147,950 was
recorded related to anticipated lease cancellation payments and severance
payment to employees. One commissary was closed and one store was sold in the
second quarter ended December 30, 1995. A total of four commissaries and three
stores were sold or closed during the six months ended December 30, 1995.
Payments of $134,343 and $335,991 were charged against the provision in the
second quarter and the six months ended December 30, 1995, respectively. The
Company plans to close the three remaining commissaries by June 1996 and is
continuing to negotiate toward sales and/or finalize plans to close the
remaining non-performing stores.
ADMINISTRATIVE AND GENERAL EXPENSES
Administrative and general expenses for the three and six month periods
ended December 30, 1995 decreased to $1,357,478 and $2,915,777, respectively, a
decrease of $291,704 and $354,392 from the corresponding periods of the
previous year. These decreases are due primarily to decreases in corporate and
divisional administrative and general expenses.
INTEREST EXPENSES, NET
Interest expense, net, during the six month period ended December 30, 1995
increased $41,142 over the corresponding six months in the prior year.
Interest expense for the quarter ended December 30, 1995 was $58,364 compared
to interest expense of $39,000 for the three month period ended December 31,
1994.
The Company has a $7,500,000 unsecured bank line of credit, bearing
interest at the 30-day LIBOR plus 150 basis points, which was 7.4687% at
December 30, 1995. Borrowings under this line were approximately $3,150,000 and
$2,300,000 for the six months ended December 30, 1995 and December 31, 1994,
respectively.
TAXES ON INCOME
The effective tax rates for the second quarter and first six months ended
December 30, 1995 were 32.4% and 26.4%, respectively. These rates are below
the statutory rates due to the availability of tax credits.
10
<PAGE> 13
LIQUIDITY AND CAPITAL RESOURCES
The Company's ability to obtain the cash required for the conduct of its
business depends upon cash flow from operations and, to a lesser extent, bank
borrowings. In general, cash flow from operations and periodic bank borrowings
have been sufficient to finance the expansion of the Company's business. The
Company does not have significant receivables or inventory and it receives
trade credit in purchasing food and supplies. Since funds are available from
cash sales, but are not required immediately to pay for food and supplies or to
finance receivables or inventory, such funds may be used for non-current
capital expenditures. In the process of refining the Company's production
units, stores not meeting the Company's performance criteria are closed and the
furniture and equipment sold. The terms of some such sales require the Company
to take back notes, which are contained in the notes receivable, for all or a
portion of the sale price.
The Company's principal capital requirement is for new equipment and
leasehold improvements for new and existing restaurants. Capital expenditures
for these purposes were $6,680,019, $10,278,019 and $6,729,196 for fiscal years
1995, 1994 and 1993, respectively. It is presently anticipated that the
Company's capital expenditures for fiscal 1996 will be approximately
$5,000,000. During the three prior years of 1995, 1994 and 1993 cash generated
from operations totalled $4,337,320, $5,026,503 and $4,238,247, respectively.
The Company expects its future capital needs will be met primarily by
internally generated funds and supplemented, as needed, by additional bank
borrowings. The Company's present plans call for opening ten to twelve new
flagship Wall Street Deli units during fiscal 1996. Capital expenditures for
the six month period ended December 30, 1995 totalled $2,497,418, compared to
$3,032,260 for the corresponding six months of the prior year. Cash generated
from operations for the six month period ended December 30, 1995 totalled
$2,631,852 compared to $1,611,896 for the corresponding six months of the prior
year.
IMPACT OF INFLATION
Many of the Company's employees are paid hourly rates related to the
federal minimum wage. Accordingly, inflation-related annual increases in the
minimum wage have historically increased the Company's labor costs.
Construction costs have also increased to developers who lease space to the
Company. They, in turn, have and may continue to increase rents for Company
restaurants. In addition, most of the leases for Company restaurants contain
rental escalation clauses based upon the cost increases incurred by lessors.
In most cases, the Company has been able to increase prices sufficiently to
match increases in its operating costs, but there is no assurance that it will
be able to do so in the future.
_______________________
11
<PAGE> 14
PART II: OTHER INFORMATION
ITEM 4: SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
(a) The Registrant's regular Annual Meeting of Shareholders was held on
November 2, 1995. Proxies for the Annual Meeting were solicited
pursuant to Regulation 14 under the Act.
(b) There was no solicitation in opposition to management's nominees for
directors as listed in the proxy statement, and all of such nominees
were elected.
(c) At the Annual Meeting the matters considered and voted upon (other
than procedural matters and ratification of auditors) and the number
of votes cast are as follows:
Election of directors:
<TABLE>
<CAPTION>
VOTES VOTES
NAME FOR WITHHELD*
<S> <C> <C>
Alan V. Kaufman 2,960,372 13,221
Robert G. Barrow 2,960,372 13,221
William S. Atherton 2,960,472 13,121
Joe Lee Griffin 2,960,472 13,121
Louis C. Henderson, Jr. 2,960,172 13,421
Jeffrey V. Kaufman 2,958,206 15,387
Jake L. Netterville 2,960,472 13,121
</TABLE>
* Includes votes withheld and broker non-votes
12
<PAGE> 15
ITEM 6: EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
Exhibit (11) - Computation of Earnings Per Common Share . . . . 15
Exhibit (27) - Financial Data Schedule (for SEC use only)
(b) Reports on Form 8-K:
There were no reports on Form 8-K filed during the quarter ended
December 30, 1995.
-----------------------------------------------------
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13
<PAGE> 16
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
DATE: WALL STREET DELI, INC.
February 8, 1996 /s/ Robert G. Barrow
-------------------------------------
ROBERT G. BARROW
President and Chief Executive Officer
February 8, 1996 /s/ Arnold McGruder
-------------------------------------
ARNOLD MCGRUDER
Treasurer
(Principal Financial Officer)
14
<PAGE> 1
Exhibit (11)
WALL STREET DELI, INC.
COMPUTATION OF EARNINGS PER COMMON SHARE
(Unaudited)
<TABLE>
<CAPTION>
For the Three Months Ended For the Six Months Ended
December 30, 1995 December 31, 1994 December 30, 1995 December 31, 1994
----------------- ----------------- ----------------- -----------------
<S> <C> <C> <C> <C>
SHARES:
Weighted average number of common shares
outstanding 3,407,317 3,390,818 3,406,960 3,387,699
Effect of shares issuable under stock option
plan as determined by the treasury stock method 4,174 37,615 10,654 40,522
--------- --------- --------- ---------
Weighted average number of common shares
outstanding as adjusted 3,411,491 3,428,433 3,417,614 3,428,221
PER COMMON SHARE COMPUTATIONS:
Net income $ 52,146 $ 366,581 $ 69,605 $ 838,543
========= =========== ========== ===========
Earnings per share $ .01 $ .11 $ .02 $ .25
========= =========== ========== ===========
</TABLE>
15
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM FINANCIAL
STATEMENTS OF WALL STREET DELI, INC. FOR THE SIX MONTHS ENDED DECEMBER 30, 1995,
AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> JUN-29-1996
<PERIOD-START> JUL-2-1995
<PERIOD-END> DEC-30-1995
<CASH> 1,439,448
<SECURITIES> 0
<RECEIVABLES> 1,859,450
<ALLOWANCES> 200,155
<INVENTORY> 1,133,113
<CURRENT-ASSETS> 6,454,800
<PP&E> 35,522,170
<DEPRECIATION> 14,481,587
<TOTAL-ASSETS> 28,800,610
<CURRENT-LIABILITIES> 8,063,253
<BONDS> 0
0
0
<COMMON> 169,789
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<TOTAL-LIABILITY-AND-EQUITY> 28,800,610
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<TOTAL-REVENUES> 34,744,271
<CGS> 31,684,182
<TOTAL-COSTS> 31,684,182
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 34,744
<INTEREST-EXPENSE> 114,142
<INCOME-PRETAX> 94,604
<INCOME-TAX> 25,000
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<EXTRAORDINARY> 0
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<NET-INCOME> 69,604
<EPS-PRIMARY> .02
<EPS-DILUTED> .02
</TABLE>
