SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarter Ended July 1, 1997 Commission file number 1-9606
AMERICAN RESTAURANT PARTNERS, L.P.
(Exact name of registrant as specified in its charter)
Delaware 48-1037438
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification)
555 North Woodlawn, Suite 3102
Wichita, Kansas 67208
(Address of principal executive offices) (Zip-Code)
Registrant's telephone number, including area code (316) 684-5119
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 [ ]
AMERICAN RESTAURANT PARTNERS, L.P.
INDEX
Page
Number
------
Part I. Financial Information
- -------------------------------
Item 1. Financial Statements
Consolidated Condensed Balance Sheets at
July 1, 1997 and December 31, 1996 1
Consolidated Statements of Operations
for the Three and Six Periods Ended
July 1, 1997 and June 25, 1996 2
Consolidated Statements of Cash Flows for
the Six Periods Ended July 1, 1997
and June 25, 1996 3
Notes to Consolidated Condensed Financial Statements 4-6
Item 2. Management's Discussion and Analysis of Consolidated
Financial Condition and Results of Operations 7-10
Part II. Other Information
- ---------------------------
Item 6. Exhibits and Reports on Form 8-K 11
AMERICAN RESTAURANT PARTNERS, L.P.
CONSOLIDATED CONDENSED BALANCE SHEETS
(Unaudited)
July 1, December 31,
ASSETS 1997 1996
- -------------------------------- ----------- -----------
Current assets:
Cash and cash equivalents $ 257,216 $ 178,826
Certificate of deposit 54,000 157,635
Investments available for sale,
net of fair market value adjustment
of $82,575 and $44,325, respectively 94,501 132,751
Accounts receivable 187,417 155,724
Due from affiliates 43,281 19,415
Notes receivable from
affiliates - current portion 75,731 84,631
Inventories 303,306 344,003
Prepaid expenses 211,094 212,008
---------- ----------
Total current assets 1,226,546 1,284,993
Net property and equipment 17,896,725 17,620,268
Other assets:
Franchise rights, net 1,067,708 1,084,080
Notes receivable from affiliates 115,354 113,410
Deposit with affiliate 350,000 350,000
Investment in Oklahoma Magic, L.P. 2,454,362 2,624,368
Other 680,005 667,964
---------- ----------
$ 23,790,700 $ 23,745,083
========== ==========
LIABILITIES AND PARTNERS' CAPITAL (DEFICIENCY)
- ----------------------------------------------
Current liabilities:
Accounts payable $ 2,616,520 $ 2,115,502
Due to affiliates 32,953 88,654
Accrued payroll and other taxes 297,653 545,816
Accrued liabilities 867,101 1,008,937
Current portion of long-term debt 9,874,662 1,428,630
Current portion of obligations
under capital leases 34,578 32,760
---------- ----------
Total current liabilities 13,723,467 5,220,299
Other noncurrent liabilities 176,850 197,308
Long-term debt 10,072,042 17,430,692
Obligations under capital leases 1,623,336 1,632,284
General Partners' interest
in Operating Partnership 142,400 153,737
Partners' capital (deficiency):
General Partners (6,236) (4,634)
Limited Partners:
Class A Income Preference 6,065,745 6,294,520
Classes B and C (6,600,648) (5,811,117)
Cost in excess of carrying value
of assets acquired (1,323,681) (1,323,681)
Unrealized loss in investment securities (82,575) (44,325)
---------- ----------
Total partners' deficiency (1,947,395) (889,237)
---------- ----------
$ 23,790,700 $ 23,745,083
========== ==========
See accompanying notes.
<TABLE>
AMERICAN RESTAURANT PARTNERS, L.P.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
<CAPTION>
Three Periods Ended Six Periods Ended
July 1, June 25, July 1, June 25,
1997 1996 1997 1996
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Net sales $10,003,638 $ 9,887,850 $19,622,843 $19,743,520
Operating costs and expenses:
Cost of sales 2,749,859 2,550,353 5,301,151 5,114,380
Restaurant labor and benefits 2,799,367 2,556,734 5,587,206 5,131,288
Advertising 676,505 668,705 1,237,796 1,321,275
Other restaurant operating
expenses exclusive of
depreciation and amortization 1,957,244 1,729,630 3,832,413 3,497,126
General and administrative:
Management fees 695,424 685,903 1,364,873 1,370,354
Other 122,777 228,798 305,083 421,273
Depreciation and amortization 494,129 384,660 984,266 766,669
Equity in loss of affiliate 95,692 40,351 170,005 51,853
--------- ---------
Income from operations 412,641 1,042,716 840,050 2,069,302
Interest income (4,462) (10,815) (12,882) (17,810)
Interest expense 537,448 413,152 1,099,981 741,987
Gain on fire settlement -- (157,867) -- (157,867)
--------- ---------
Income (loss) before General Partners'
interest in income (loss) of
Operating Partnership (120,345) 798,246 (247,049) 1,502,992
General Partners' interest in
income (loss) of Operating Partnership (1,203) 7,982 (2,470) 15,030
--------- ---------
Net income (loss) $ (119,142) $ 790,264 $ (244,579) $ 1,487,962
========= =========
Net income (loss) allocated to Partners:
Class A Income Preference $ (24,321) $ 161,791 $ (49,959) $ 304,651
Class B $ (35,662) $ 236,140 $ (73,195) $ 444,631
Class C $ (59,159) $ 392,333 $ (121,425) $ 738,680
Weighted average number of Partnership
units outstanding during period:
Class A Income Preference 815,309 815,309 815,309 815,309
Class B 1,195,499 1,189,975 1,194,505 1,189,924
Class C 1,983,225 1,977,071 1,981,569 1,976,863
Net income (loss) per Partnership interest:
Class A Income Preference $ (0.03) $ 0.20 $ (0.06) $ 0.37
Class B $ (0.03) $ 0.20 $ (0.06) $ 0.37
Class C $ (0.03) $ 0.20 $ (0.06) $ 0.37
Distributions per Partnership interest:
Class A Income Preference $ 0.11 $ 0.26 $ 0.22 $ 0.42
Class B $ 0.11 $ 0.26 $ 0.22 $ 0.42
Class C $ 0.11 $ 0.26 $ 0.22 $ 0.42
<FN>
See accompanying notes.
</FN>
</TABLE>
AMERICAN RESTAURANT PARTNERS, L.P.
CONSOLIDATED STATEMENTS OF CASH FLOW
(Unaudited)
Six Periods Ended
July 1, June 25,
1997 1996
----------- -----------
Cash flows from operating activities:
Net income (loss) $ (244,579) $ 1,487,962
Adjustments to reconcile net income (loss)
to net cash provided by operating
activities:
Depreciation and amortization 984,266 766,669
Provision for deferred rent 5,033 8,443
Provision for deferred compensation -- 6,300
Unit compensation expense 11,737 15,900
Equity in loss of affiliate 170,005 51,853
Loss on disposition of assets 18,222 14,441
Gain on fire settlement -- (157,867)
General Partners' interest in net
income (loss) of Operating Partnership (2,470) 15,030
Net change in operating assets and liabilities:
Accounts receivable (31,693) (16,596)
Due from affiliates (23,866) 9,930
Inventories 40,697 (44,393)
Prepaid expenses 914 (14,604)
Accounts payable 346,443 615,794
Due to affiliates 98,874 (39,222)
Accrued payroll and other taxes (248,163) (26,609)
Accrued liabilities (141,836) 110,360
Other, net (76,960) (46,764)
--------- ---------
Net cash provided by
operating activities 906,624 2,756,627
Cash flows from investing activities:
Investment in affiliate -- (3,000,000)
Purchase of certificate of deposit (6,567) (155,432)
Redemption of certificate of deposit 110,202 --
Additions to property and equipment (1,208,840) (2,889,895)
Proceeds from sale of property and equipment 701 7,351
Purchase of franchise rights (15,000) --
Collections of notes receivable from affiliates 44,456 13,306
Net proceeds from fire settlement -- 180,437
--------- ---------
Net cash used in
investing activities (1,075,048) (5,844,233)
Cash flows from financing activities:
Payments on long-term borrowings (655,798) (2,190,431)
Proceeds from long-term borrowings 1,743,180 6,897,060
Payments on capital lease obligations (7,130) (30,508)
Distributions to Partners (877,821) (1,671,232)
Proceeds from issuance of Class B and C units 53,250 30,750
Repurchase of Class B and C units -- (44,208)
General Partners' distributions
from Operating Partnerships (8,867) (16,925)
--------- ---------
Net cash provided by
financing activities 246,814 2,974,506
--------- ---------
Net increase (decrease) in
cash and cash equivalents 78,390 (113,100)
Cash and cash equivalents at beginning of period 178,826 782,348
--------- ---------
Cash and cash equivalents at end of period $ 257,216 $ 669,248
========= =========
See accompanying notes.
AMERICAN RESTAURANT PARTNERS, L.P.
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
1. General
-------
The accompanying consolidated financial statements include the
accounts of American Restaurant Partners, L.P. and its majority
owned subsidiaries, American Pizza Partners, L.P. and APP Concepts,
LLC, hereinafter collectively referred to as the Partnership, and
have been prepared without audit. The Balance Sheet at December 31,
1996 has been derived from financial statements which have been
audited by Ernst & Young LLP, independent auditors. In the opinion
of management, all adjustments of a normal and recurring nature
which are necessary for a fair presentation of such financial
statements have been included. These statements should be read in
conjunction with the financial statements and notes contained in
the Partnership's Annual Report filed on Form 10-K for the fiscal
year ended December 31, 1996.
The results of operations for interim periods are not necessarily
indicative of the results for the full year. The Partnership
historically has realized approximately 40% of its operating
profits in periods six through nine (18 weeks).
2. Distribution to Partners
------------------------
On July 2, 1997 the Partnership declared a distribution of $0.05
per unit to all unitholders of record as of July 14, 1997 payable
on July 25, 1997. The distribution is not reflected in the July 1,
1997 consolidated condensed financial statements.
3. Investment in Affiliate
-----------------------
On March 13, 1996, the Partnership purchased a 45% interest in a
newly formed limited partnership, Oklahoma Magic, L.P. ("Magic"),
that owns and operates thirty-three Pizza Hut restaurants in
Oklahoma for $3.0 million in cash. The purchase was financed by
the Partnership from a short-term note payable entered into with
Intrust Bank which was refinanced on a long-term basis on July 30,
1996. The remaining partnership interests in Magic are held by
Restaurant Management Company of Wichita, Inc. (29.25%), an
affiliate of the Partnership, Hospitality Group of Oklahoma, Inc.
(HGO)(25%), the former owners of the thirty-three Oklahoma
restaurants, and RMC American Management, Inc. (RAM) (.75%), the
managing general partner of the Partnership. RAM is also the
managing general partner of Magic. The Partnership accounts for
its investment in the unconsolidated affiliate using the equity
method of accounting. The proforma unaudited results of operations
for the six periods ended June 25, 1996, assuming consummation of
the purchase and financing of the $3.0 million note payable as of
December 27, 1995 are as follows:
Net sales $19,743,520
Equity in loss (14,751)
Net income 1,413,856
Net income per partnership interest
Class A Income Preference $ 0.36
Class B $ 0.36
Class C $ 0.36
In November, 1996 Magic notified HGO that it is seeking to
terminate HGO's interest in Magic pursuant to the terms of the
Partnership Agreement for alleged violations of the Pizza Hut
Franchise Agreement and the alleged occurrence of an Adverse
Terminating Event as defined in the Partnership Agreement. Magic
alleges that HGO contacted and offered employment to a
significant number of the management employees of Magic. Magic
has also alleged that HGO made certain misrepresentations in
connection with the formation of Magic. HGO has denied that such
franchise violations have occurred and that it made any
misrepresentations at the formation of Magic. The matter has been
submitted to arbitration. In the arbitration proceeding, HGO has
asserted that it was fraudulently induced to enter into the Magic
Partnership Agreement by Restaurant Management Company of
Wichita, Inc. and was further damaged by alleged mismanagement of
the operations. HGO is seeking recision of the purchase and
contribution of the restaurants or in the alternative
compensatory and punitive damages. The parties continue to seek
to resolve the disagreement through negotiation and mediation.
If Magic prevails, the interest of HGO in Magic will be purchased
by Magic and the interest of the Partnership in Magic will likely
increase from 45% to 60%. The amount of damages sought by HGO
has not been enumerated.
4. Long-Term Debt - Covenant Noncompliance
---------------------------------------
The Partnership has met all scheduled debt payments; however, at
July 1, 1997, it was not in compliance with the fixed charge
ratio required by the loan covenants under the borrowing
agreement with Heller Financial, Inc. Accordingly, the
Partnership has classified the entire amount payable to Heller
Financial, Inc. of $2,188,000 as a current liability in the
accompanying consolidated balance sheet. As a result of the
default, Heller Financial, Inc. has the option to increase the
interest rate two percent over the rate that the Partnership is
currently paying.
5. Recently Issued Accounting Standards
------------------------------------
In February 1997, the Financial Accounting Standards Board issued
Statement of Accounting Standards No. 128, "Earnings per Share"
("FAS 128"), which specifies the computation, presentation, and
disclosure requirements for earnings per share with the objective
to simplify the computation of earnings per share. FAS 128 is
effective for financial statements for periods ending after
December 15, 1997 and earlier application is not permitted.
After the effective date, all prior period earnings per share
data shall be restated to conform with the provisions of FAS 128.
The adoption of FAS 128 is not expected to have a material impact
on the Partnership's earnings per share data.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
CONSOLIDATED FINANCIAL CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
- ---------------------
As of July 1, 1997, the Partnership operated 54 traditional Pizza
Hut red roof restaurants, eight delivery/carryout units, one
convenience store location and three dualbrand locations.
Quarter Ended July 1, 1997 Compared to Quarter Ended
- ----------------------------------------------------
June 25, 1996
- -------------
NET SALES. Net sales for the quarter ended July 1, 1997 increased
$116,000 from $9,888,000 to $10,004,000, a 1.2% increase over the
second quarter of 1996. Comparable restaurant sales decreased 4.7%
which approximates the sales trend of the entire Pizza Hut system.
INCOME FROM OPERATIONS. Income from operations decreased $630,000
from $1,043,000 to $413,000, a 60.4% decrease from the same quarter
in 1996. As a percentage of net sales, income from operations
decreased from 10.5% for the quarter ended June 25, 1996 to 4.1%
for the quarter ended July 1, 1997. Cost of sales increased as a
percentage of net sales from 25.8% for the quarter ended June 25,
1996 to 27.5% for the quarter ended July 1, 1997 due to a free
sampling program begun in late April introducing new higher quality
pizzas with better tasting, higher cost toppings. Labor and
benefits expense increased as a percentage of net sales from 25.9%
in 1996 to 28.0% in 1997 as a result of the minimum wage increase
and lower same store sales. Advertising remained at 6.8% of net
sales in both 1996 and 1997. Operating expenses increased to 19.6%
of net sales in 1997 from 17.5% of net sales in 1996 attributable
to the free sampling program and to the effects of lower same store
sales on fixed operating costs. General and administrative
expenses decreased from 9.3% of net sales in 1996 to 8.2% of net
sales in 1997 due to a decrease in bonuses paid on operating
results. Depreciation and amortization expense increased from 3.9%
of net sales in 1996 to 4.9% of net sales in 1997 due to
construction of new restaurants and remodels of existing
restaurants during 1996 and the first six periods of 1997. Equity
in loss of affiliate amounted to 1.0% of net sales for the quarter
ended July 1, 1997 compared to 0.4% of net sales for the quarter
ended June 25, 1996.
NET INCOME (LOSS). Net earnings decreased $909,000 to a net loss
of $119,000 for the quarter ended July 1, 1997 compared to net
income of $790,000 for the quarter ended June 25, 1996. This
decrease is attributable to the decrease in income from operations
noted above combined with an increase in interest expense of
$124,000 due to additional debt primarily used to fund the
acquisition of a 45% interest in Oklahoma Magic, L.P. and to
develop new restaurants. The 1996 net earnings include a $158,000
gain on fire settlement.
Six Periods Ended July 1, 1997 Compared to Six Periods
- ------------------------------------------------------
Ended June 25, 1996
- -------------------
NET SALES. Net sales for the six periods ended July 1, 1997
decreased $121,000 from $19,744,000 to $19,623,000, a 0.6% decrease
from the first six periods of 1996. Comparable restaurant sales
decreased 6.8% which approximates the sales trend of the entire
Pizza Hut system.
INCOME FROM OPERATIONS. Income from operations decreased
$1,229,000 from $2,069,000 to $840,000, a 59.4% decrease from the
first six periods of 1996. As a percentage of net sales, income
from operations decreased from 10.5% for the six periods ended June
25, 1996 to 4.3% for the six periods ended July 1, 1997. Cost of
sales increased as a percentage of net sales from 25.9% for the six
periods ended June 25, 1996 to 27.0% for the six periods ended July
1, 1997 primarily due to the free sampling program during second
quarter introducing new higher quality pizzas with better tasting,
higher cost toppings. Labor and benefits expense increased as a
percentage of net sales from 26.0% in 1996 to 28.5% in 1997 as a
result of the minimum wage increase and lower same store sales.
Advertising decreased as a percentage of net sales from 6.7% in
1996 to 6.3% in 1997. Operating expenses increased from 17.7% of
net sales in 1996 to 19.5% of net sales in 1997 attributable to the
effects of the sampling program and the effects of lower same store
sales on fixed operating costs. General and administrative expenses
decreased from 9.1% of net sales in 1996 to 8.5% of net sales in
1997. Depreciation and amortization expense increased from 3.9% of
net sales in 1996 to 5.0% of net sales in 1997 due to the
construction of new restaurants and remodels of existing
restaurants during 1996 and the first six periods of 1997. Equity
in loss of affiliate amounted to 0.9% and 0.3% of net sales in 1997
and 1996, respectively.
NET INCOME (LOSS). Net earnings decreased $1,733,000 to a net loss
of $245,000 for the six periods ended July 1, 1997 compared to net
income of $1,488,000 for the six periods ended June 25, 1996. This
decrease is attributable to the decrease in income from operations
noted above combined with an increase in interest expense of
$358,000 due to additional debt primarily used to fund the
acquisition of a 45% interest in Oklahoma Magic, L.P. and to
develop new restaurants. The 1996 net earnings include a $158,000
gain on fire settlement.
LIQUIDITY AND CAPITAL RESOURCES
- -------------------------------
The Partnership generates its principal source of funds from net
cash provided by operating activities. Management believes that net
cash provided by operating activities and various other sources of
income will provide sufficient funds to meet planned capital
expenditures for recurring replacement of equipment in existing
restaurants and to service debt obligations.
At July 1, 1997 the Partnership had a working capital deficiency of
$12,497,000 compared to a working capital deficiency of $3,935,000
at December 31, 1996. Approximately, $1,805,000 of the working
capital deficiency at July 1, 1997 results from the classification
of the entire amount of outstanding notes payable to Heller
Financial, Inc. as a current liability because the Partnership
was in default of the fixed charge ratio at July 1, 1997. There
have been no defaults in making scheduled payments of either
principal or interest. As a result of the default, Heller
Financial, Inc. has the option to increase the interest rate two
percent over the rate that the Partnership is currently paying.
The remaining increase in working capital deficiency of $6,757,000
is a result of an increase in current portion of long-term debt
used primarily to acquire a 45% interest in Oklahoma Magic, L.P.
and for development of new restaurants. The Partnership plans to
refinance the notes on a long-term basis during 1997. The
Partnership routinely operates with a negative working capital
position which is common in the restaurant industry and which
results from the cash sales nature of the restaurant business
and payment terms with vendors.
Master Limited Partnerships (MLPs) are not currently subject to
federal or state income taxes. However, under the Omnibus Budget
Reconciliation Act of 1987, certain MLPs, including the
Partnership, will be taxed as corporations beginning in 1998.
NET CASH PROVIDED BY OPERATING ACTIVITIES. For the six periods
ended July 1, 1997, net cash provided by operating activities
amounted to $906,000 compared to $2,757,000 for the six periods
ended June 25, 1996. This decrease is primarily the result of the
decrease in net earnings.
INVESTING ACTIVITIES. Property and equipment expenditures
represent the largest investing activity by the Partnership.
Capital expenditures for the six periods ended July 1, 1997 were
$1,209,000, of which $561,000 was for the replacement of equipment
in existing restaurants and $648,000 was for the development of new
restaurants.
FINANCING ACTIVITIES. Cash distributions declared during the six
periods ended July 1, 1997 were $878,000 amounting to $0.22 per
unit as compared to $1,671,000, or $0.42 per unit, during the first
six periods of 1996. The Partnership's distribution objective,
generally, is to distribute all operating revenues less operating
expenses (excluding noncash items such as depreciation and
amortization), capital expenditures for existing restaurants,
interest and principal payments on Partnership debt, and such cash
reserves as the managing General Partner may deem appropriate.
The reduction in cash distributions from the prior year reflects
the decline in operating revenues.
During the six periods ended July 1, 1997, the Partnership's
proceeds from borrowings amounted to $1,743,000. The proceeds were
used primarily to develop new restaurants and to replenish operating
capital. The Partnership opened two new dualbrand locations during
the first six periods of 1997 and converted a traditional red roof
restaurant to a dualbrand location. Management anticipates spending
an additional $315,000 for recurring replacement of equipment
in existing restaurants which will be financed from net cash
provided by operating activities. The actual level of capital
expenditures may be higher in the event of unforeseen breakdowns
of equipment or lower in the event of inadequate net cash flow
from operating activities.
OTHER MATTERS. The Partnership, through its minority owned
subsidiary, Oklahoma Magic, L.P., is involved in a dispute with
Hosptiality Group of Oklahoma, Inc., the former owners of the
thirty-three Oklahoma restaurants that were purchased by Magic in
March 1996. See Note 3 to the Financial Statements.
As we have previously reported, the Omnibus Budget Reconciliation
Act of 1987 provides that public limited partnerships will become
taxable entities beginning in 1998. Without some change in our
organizational structure, our company will start paying income taxes
at the company level as of January 1, 1998. This would decrease the
amount of cash available to the company by the amount of taxes it
must pay. As a result the company would have to reduce cash
distributions by at least the amount of the taxes, and perhaps
eliminate the distributions entirely.
This report contains certain forward-looking statements within the
meaning of Section 27A of the Securities Act, and Section 21E of the
Exchange Act, which are intended to be covered by the safe harbors
created thereby. Although the Partnership believes that the
assumptions underlying the forward-looking statements contained
herein are reasonable, any of the assumptions could be inaccurate,
and therefore, there can be no assurance that the forward-looking
statements included in this report will prove to be accurate.
Factors that could cause actual results to differ from the results
discussed in the forward-looking statements include, but are not
limited to, consumer demand and market acceptance risk, the effect
of economic conditions, including interest rate fluctuations, the
impact of competing restaurants and concepts, the cost of
commodities and other food products, labor shortages and costs and
other risks detailed in the Partnership's Securities and Exchange
Commission filings.
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
--------------------------------
(a) Exhibits
None
(b) Reports on Form 8-K
During the fiscal period covered by this Form 10-Q, no
reports on Form 8-K were filed.
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.
AMERICAN RESTAURANT PARTNERS, L.P.
(Registrant)
By: RMC AMERICAN MANAGEMENT, INC.
Managing General Partner
Date: 8/14/97 By: /s/Hal W. McCoy
-------- ---------------------
Hal W. McCoy
President and Chief Executive Officer
Date: 8/14/97 By: /s/Terry Freund
-------- --------------------
Terry Freund
Chief Financial Officer
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
consolidated condensed financial statements of American Restaurant Partners,
L.P. at July 1, 1997 and is qualified in its entirety by reference to such
financial statement.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-30-1997
<PERIOD-END> JUL-01-1997
<CASH> 257216
<SECURITIES> 94501
<RECEIVABLES> 771783
<ALLOWANCES> 0
<INVENTORY> 303306
<CURRENT-ASSETS> 1226546
<PP&E> 30175268
<DEPRECIATION> 12278543
<TOTAL-ASSETS> 23790700
<CURRENT-LIABILITIES> 13723467
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> (1947395)
<TOTAL-LIABILITY-AND-EQUITY> 23790700
<SALES> 19622843
<TOTAL-REVENUES> 19622843
<CGS> 5301151
<TOTAL-COSTS> 18782793
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1099981
<INCOME-PRETAX> (244579)
<INCOME-TAX> 0
<INCOME-CONTINUING> (244579)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (244579)
<EPS-PRIMARY> (.06)
<EPS-DILUTED> 0
</TABLE>
