<PAGE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): August 8, 1996
BUFFETS, INC.
--------------------------------------------------------
(Exact name of registrant as specified in its charter)
Minnesota 0-14370 41-1462294
-------------------------- -------------------------- --------------------
(State of Incorporation) (Commission file number) (I.R.S. Employer
Identification No.)
10260 Viking Drive, Suite 100
Eden Prairie, Minnesota 55344
- --------------------------------------------- ----------------
(Address of principal executive offices) (Zip Code)
(612) 942-9760
-------------------------------
(Registrant's telephone number)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
<PAGE>
ITEM 5. OTHER EVENTS
On August 7, 1996, Buffets, Inc. (the "Company") announced results
for the twelve-week and twenty-eight week periods ended July 17, 1996. A
discussion of those results is contained in the Press Release of the Company
dated August 7, 1996 which is incorporated by reference and filed as an Exhibit
to this Report.
ITEM 7. EXHIBITS
99.1 Press release dated August 7, 1996.
2
<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.
BUFFETS, INC.
Date: August 8, 1996 By: /s/ ROE H. HATLEN
-------------------------------
Roe H. Hatlen, Chairman and
Chief Financial Officer
3
<PAGE>
Exhibit Index
EXHIBIT
99.1 Press release dated August 7, 1996
4
<PAGE>
[LETTERHEAD]
Contact: Clark C. Grant For Immediate Release
Executive VP of Finance, Treasurer -----------------------
August 7, 1996
BUFFETS, INC. ANNOUNCES
RECORD RESULTS FOR THE SECOND QUARTER 1996
Eden Prairie, Minnesota . . . Clark C. Grant, Executive Vice President of
Finance, Treasurer (NASDAQ: BOCB), reported that the second quarter of 1996 was
the most profitable quarter in the history of the Company.
For the second quarter (12 weeks) 1996, net earnings increased 8.5% to
$8,217,000 from $7,571,000 in 1995. Earnings per share increased 8.3% to $.26
on 31,541,000 shares, compared to $.24 on 31,331,000 shares in 1995. Restaurant
sales for the quarter increased 10.2% to $131,451,000 from $119,282,000 during
the same quarter of 1995. Average weekly sales per restaurant decreased during
the second quarter by 1.2% to $43,363 from $43,906 for the second quarter 1995.
Comparable restaurant sales were down 2.9% versus that quarter.
For the twenty-eight weeks ended July 17, 1996, net earnings decreased 4.3% to
$13,766,000 from $14,380,000 in the same period in 1995. Earnings per share
decreased 4.3% to $.44 from $.46 in the same period of 1995. Restaurant sales
for the twenty-eight week period increased 10.0% to $287,386,000 from
$261,372,000 in 1995. Average weekly sales per restaurant decreased during the
first twenty-eight weeks by 2.5% to $41,114 from $42,168 for the same period in
1995. Comparable restaurant sales were down 2.7% versus that period.
In regards to the second quarter, Roe H. Hatlen, Chairman and CEO, stated, "We
are pleased with the net results of the second quarter, however, we recognize
that we must be more effective in building business at the store level
especially in non-media markets. Our customer satisfaction program continues to
work as complaints are running well below last year. This is especially true at
our new restaurants, where we have strengthened the opening program and
increased our training in an effort to reduce the "honeymoon trial" customer
declines typically associated with restaurant openings. We are pleased that the
thirteen new restaurants opened in 1996 generated average weekly sales in the
second quarter of $53,858, well above the Company average.
"During the quarter the marketing campaign that we began late in the first
quarter was effective in building sales and profits compared to non-marketing
areas. Marketing expenditures were $2,469,000 versus $844,000 in 1995. The
program will continue during the third quarter. Also during the second quarter
we continued our commitment to operational excellence as 57 of our Food
Managers' completed a two week food refresher class at the OCB Training College
in Minneapolis. Currently, 92 of our food managers have completed this program.
By year end all food managers will have completed the program as we continue to
build our food expertise."
<PAGE>
Commenting on the third quarter, Mr. Hatlen stated "We are looking for a more
profitable quarter than a year ago despite a soft start due to the Olympic games
which had some of our customers eating at home, especially at dinner time to
watch the games on T.V." Hatlen also said, "Preparations for the prospective
merger with HomeTown Buffet, Inc. are moving along very well. Numerous meetings
have been held, an Olympic type excitement is building and everyone is getting
ready to hit the ground running when the merger is approved by both Company's
respective shareholders. The record date has been set for August 16 with the
mailing of the proxy statements on August 19 and the special shareholders
meetings of both companies to be held on September 19, 1996."
In regard to new restaurant openings, Mr. Hatlen said, "Five new restaurants
opened during the quarter and six other units were under construction at quarter
end. Approximately six restaurants are expected to open during the third
quarter and 10 to 15 in the fourth quarter. In light of management's
concentration on meshing the Company with HomeTown Buffet, Inc., the development
schedule has been adjusted. This includes two planned openings that were
dropped to fit better with the development objectives of a combined
organization." He also said "one restaurant opening will be delayed due to
redesign to test new buffet concepts."
Buffets, Inc. currently operates 256 Old Country Buffet restaurants in 31 states
and franchises six restaurants in two states.
This press release contains forward-looking statements, including statements
regarding the Company's prospective merger plans, expectations regarding third
quarter profitability and the number of restaurants expected to be opened during
the remainder of 1996. In addition to the factors discussed above, other
factors that could cause actual results to differ materially include the success
of the merger, adverse weather conditions, the success of the Company's
advertising program, changes in food supply costs and general economic
conditions. In addition, the ability of the Company to open new restaurants
depends on a number of factors, including its ability to find suitable locations
and negotiate acceptable leases and land purchases, its ability to attract and
retain qualified restaurant managers and the availability of capital.
To hear the recorded quarterly financial results please call our shareholder
information line at 1-888-731-9401. To receive a release via fax, call 1-800-
758-5804 extension 122825. Our Internet address is:
http://www.prnewswire.com/cnoc/exec/menu?/122825
Financial Highlights on Following Page
<PAGE>
BUFFETS, INC. AND SUBSIDIARIES
RESULTS OF OPERATIONS
JULY 17, 1996
(UNAUDITED)
<TABLE>
<CAPTION>
Twenty-Eight Weeks Ended Twelve Weeks Ended
------------------------------------------- -------------------------------------------
(In thousands, except for per share amounts and average weekly sales)
July 12, July 17, July 12, July 17,
1995 Percent 1996 Percent 1995 Percent 1996 Percent
---------- ---------- ---------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Restaurant sales $201,372 100.0% $287,386 100.0% $119,282 100.0% $131,451 100.0%
Restaurant costs:
Food costs 91,337 34.9% 98,988 34.5% 41,505 34.8% 44,415 33.8%
Labor costs 73,688 28.2% 82,011 28.5% 33,163 27.8% 35,978 27.4%
Direct and occupancy costs 59,256 22.7% 68,707 23.9% 26,633 22.3% 30,400 23.1%
--------- ---------- ---------- ---------- ---------- ---------- ---------- ----------
Total restaurant costs 224,261 85.8% 249,706 86.9% 101,301 84.9% 110,793 84.3%
--------- ---------- ---------- ---------- ---------- ---------- ---------- ----------
Restaurant profits 37,111 14.2% 37,680 13.1% 17,981 15.1% 20,658 15.7%
Selling general and
administrative expenses 14,034 5.4% 15,846 5.5% 5,820 4.9% 7,640 5.8%
--------- ---------- ---------- ---------- ---------- ---------- ---------- ----------
23,077 8.8% 21,834 7.6% 12,161 10.2% 13,018 9.9%
Other income 118 0.0% 372 0.1% 52 0.0% 238 0.2%
--------- ---------- ---------- ---------- ---------- ---------- ---------- ----------
Earnings before income taxes 23,195 8.8% 22,206 7.7% 12,213 10.2% 13,256 10.1%
Income taxes 8,815 3.3% 8,440 2.9% 4,642 3.9% 5,039 3.8%
--------- ---------- ---------- ---------- ---------- ---------- ---------- ----------
Net earnings $14,380 5.5% $13,766 4.8% $7,571 6.3% $8,217 6.3%
--------- ---------- ---------- ---------- ---------- ---------- ---------- ----------
--------- ---------- ---------- ---------- ---------- ---------- ---------- ----------
Earnings per share $.46 $.44 -4.3% $.24 $.26 8.3%
--------- ---------- ---------- ----------
--------- ---------- ---------- ----------
Common shares 31,231 31,550 1.0% 31,331 31,541 0.7%
Number of Company-owned
restaurants open at
end of period 230 255 10.9% 230 255 10.9%
Average weekly sales of
Company-owned restaurants
open at end of period $42,168 $41,114 -2.5% $43,906 $43,363 -1.2%
</TABLE>
Condensed Consolidated Balance Sheet
(Unaudited)
Assets
January 3, July 17,
1996 1996
-------------- --------------
(in thousands)
Current assets $29,395 $34,354
Property and equipment (net) 220,627 223,497
Goodwill (net) 5,365 5,210
Other assets 520 463
-------------- --------------
$255,907 $263,524
-------------- --------------
-------------- --------------
Liabilities and Stockholders' Equity
Current liabilities $57,402 $59,297
Longterm debt 14,000 5,000
Deferred income 598 387
Deferred income taxes 11,979 12,641
Stockholders' equity 171,928 186,199
-------------- --------------
$255,907 $263,524
-------------- --------------
-------------- --------------
