<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C.
20549
FORM 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarter Ended: Commission File Number:
September 30, 1997 0-19334
- ------------------ -----------------------
OUTBACK STEAKHOUSE, INC.
----------------------------------------------------
(Exact name of registrant as specified in its charter)
DELAWARE 59-3061413
- ------------------------------- ------------------------------------
(State or other jurisdiction of (IRS Employer Identification Number)
incorporation or organization)
550 North Reo Street, Suite 200
Tampa, FL 33609
-------------------------------------------------
(Address of principal executive offices) (Zip Code)
(813) 282-1225
--------------------------------------------------
(Registrant's telephone number, including area code)
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 the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date. As of November 11,
1997, there were 47,824,233 shares of Common Stock, $.01 par value
outstanding.
1 of 17<PAGE>
OUTBACK STEAKHOUSE, INC.
PART I: FINANCIAL INFORMATION
Item 1. Financial Statements
The accompanying unaudited consolidated financial statements have
been prepared by Outback Steakhouse, Inc. (the "Company") pursuant to the
rules and regulations of the Securities and Exchange Commission.
Accordingly, they do not include all of the information and footnotes
required by generally accepted accounting principles for complete
financial statements. In the opinion of the Company, all adjustments
(consisting only of normal recurring entries) necessary for the fair
presentation of the Company's results of operations, financial position
and cash flows for the periods presented have been included.
Page 2 of 17<PAGE>
OUTBACK STEAKHOUSE, INC.
CONSOLIDATED BALANCE SHEETS
(in thousands)
September 30, December 31,
1997 1996
------------- -----------
ASSETS (unaudited)
CURRENT ASSETS
Cash and cash equivalents.............. $ 18,134 $ 15,661
Inventories............................ 17,300 16,637
Other current assets................... 12,411 8,810
------- -------
Total current assets.............. 47,845 41,108
PROPERTY, FIXTURES AND EQUIPMENT, NET.... 458,452 397,759
INVESTMENTS IN AND ADVANCES TO
UNCONSOLIDATED AFFILIATES.............. 11,418 13,968
OTHER ASSETS............................. 16,228 17,008
------- -------
$533,943 $469,843
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable....................... $ 15,522 $ 27,824
Sales taxes payable.................... 5,989 6,027
Accrued expenses....................... 22,911 19,208
Unearned revenue....................... 6,394 20,334
Current portion of long-term debt...... 600 706
------- -------
Total current liabilities......... 51,416 74,099
DEFERRED INCOME TAXES.................... 1,200 1,141
LONG-TERM DEBT........................... 86,595 47,595
INTEREST OF MINORITY PARTNERS IN
CONSOLIDATED PARTNERSHIPS.............. 1,588 1,569
OTHER LONG TERM LIABILITIES.............. 5,000 3,000
------- -------
Total liabilities.................... 145,799 127,404
------- -------
STOCKHOLDERS' EQUITY
Common stock, $0.01 par value, 200,000
and 100,000 shares authorized at
September 30, 1997 and December 31,1996,
respectively; 47,785 and 48,009, issued
and outstanding as of September 30, 1997
and December 31,1996, respectively... 478 480
Additional paid-in capital............. 114,769 111,941
Retained earnings...................... 286,797 230,018
------- -------
402,044 342,439
Less treasury stock, 736 shares
at September 30, 1997, at cost....... (13,900)
------- -------
Total stockholders' equity........... 388,144 342,439
------- -------
$533,943 $469,843
======== ========
See notes to consolidated financial statements.
3 of 17<PAGE>
OUTBACK STEAKHOUSE, INC.
CONSOLIDATED STATEMENTS OF INCOME
(in thousands except per share data, unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
1997 1996 1997 1996
------- ------- ------- -------
REVENUES................ $289,209 $236,730 $847,975 $689,313
COSTS AND EXPENSES ------- ------- ------- -------
Cost of revenues...... 110,299 92,801 323,850 267,695
Labor & other
related.............. 68,815 54,385 200,377 156,954
Other restaurant
operating............ 63,333 50,026 187,054 145,635
General & administrative 10,468 8,032 31,714 22,209
Loss (income) from
operations of uncon-
solidated affiliates. 118 135 532 (11)
------- ------- ------- -------
253,033 205,379 743,527 592,482
------- ------- ------- -------
INCOME FROM OPERATIONS.. 36,176 31,351 104,448 96,831
INTEREST EXPENSE, NET... (632) (67) (1,513) (592)
INCOME BEFORE ELIMINATION OF------- ------- ------- -------
MINORITY PARTNERS' INTEREST
AND INCOME TAXES...... 35,544 31,284 102,935 96,239
ELIMINATION OF MINORITY
PARTNERS' INTEREST.... 4,946 4,042 14,915 13,732
INCOME BEFORE PROVISION ------- ------- ------- -------
FOR INCOME TAXES...... 30,598 27,242 88,020 82,507
PROVISION FOR INCOME
TAXES................. 10,282 9,530 31,241 29,702
------- ------- ------- -------
NET INCOME.............. $ 20,316 $ 17,712 $ 56,779 $ 52,805
======= ======= ======= =======
EARNINGS PER COMMON
SHARE................. $ 0.41 $ 0.36 $ 1.17 $ 1.07
======= ======= ======= =======
WEIGHTED AVERAGE NUMBER OF
COMMON SHARES
OUTSTANDING........... 49,000 49,200 48,750 49,500
======= ======= ======= =======
See notes to consolidated financial statements.
4 of 17<PAGE>
OUTBACK STEAKHOUSE, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands, unaudited)
Nine Months Ended September 30,
-------------------------------
1997 1996
Cash flows from operating activities: -------------- ------------
Net income.................................. $ 56,779 $ 52,805
Adjustments to reconcile net income to
cash provided by operating activities:
Depreciation.............................. 22,845 16,841
Amortization.............................. 10,748 8,906
Outside partners' interest in
consolidated partnerships' income........ 14,915 13,732
Loss (income) from unconsolidated affiliates 532 (11)
Change in assets and liabilities:
Increase in inventories................... (663) (3,331)
(Increase) decrease in other current assets (3,601) 4,103
Increase in other assets.................. (9,968) (8,825)
Decrease in accounts payable, sales taxes
payable, and accrued expenses............ (8,637) (7,345)
Decrease in unearned revenue.............. (13,940) (10,607)
Increase in deferred income taxes......... 59 304
Increase in other long term liabilities... 2,000 6,000
------ ------
Net cash provided by operating activities 71,069 72,572
------ ------
Cash flows used in investing activities:
Sales of investment securities............. 623
Capital expenditures....................... (83,538) (77,020)
Payments from unconsolidated affiliates.... 2,957 4,417
Distributions to unconsolidated affiliates. (236) (391)
Investments in and advances to unconsolidated
affiliates................................ (703) (1,746)
------ ------
Net cash used in investing activities.... (81,520) (74,117)
Cash flows provided by (used in) financing
activities: ------ ------
Proceeds from issuance of common stock..... 2,826 3,510
Proceeds from issuance of long-term debt... 39,424 47,844
Proceeds from minority partners' contributions 1,375 1,550
Distributions to minority partners
and shareholders.......................... (16,271) (15,157)
Repayments of long-term debt............... (530) (40,183)
Purchases of treasury stock................ (13,900)
Net cash provided by (used in) financing ------ ------
activities............................. 12,924 (2,436)
------ ------
Net increase (decrease) in cash and cash
equivalents.............................. 2,473 (3,981)
Cash and cash equivalents at beginning of period 15,661 27,089
------ ------
Cash and cash equivalents at end of period.. $ 18,134 $ 23,108
Supplemental disclosures of cash flow information: ====== =========
Cash paid for interest................... $ 2,858 $ 1,005
Cash paid for income taxes............... 30,235 19,000
See notes to consolidated financial statements.
5 of 17<PAGE>
OUTBACK STEAKHOUSE, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. Other Current Assets
Other current assets consisted of the following (in thousands):
September 30, December 31,
1997 1996
------------- ------------
Deposits (including income tax (unaudited)
deposits) ....................... $ 3,548 $ 755
Accounts receivable............... 1,859 1,898
Prepaid expenses.................. 5,959 4,961
Other current assets.............. 1,045 1,196
------- ---------
$12,411 $8,810
======= =========
2. Property, Fixtures and Equipment, Net
Property, fixtures and equipment consisted of the following (in
thousands):
September 30, December 31,
1997 1996
------------- ------------
(unaudited)
Land.............................. $101,153 $ 85,255
Buildings and building improvements 188,059 153,212
Furniture and fixtures............ 46,016 36,794
Equipment......................... 109,403 92,800
Leasehold improvements............ 82,813 74,858
Construction in progress.......... 17,097 18,084
Accumulated depreciation.......... (86,089) (63,244)
-------- --------
$458,452 $397,759
======== ========
3. Other Assets
Other assets consisted of the following (in thousands):
September 30, December 31,
1997 1996
------------- ------------
(unaudited)
Preopening costs, net............. $ 7,110 $ 8,818
Intangible assets (including liquor
licenses)........................ 5,843 4,485
Other assets...................... 3,275 3,705
------- --------
$16,228 $17,008
======= ========
6 of 17<PAGE>
OUTBACK STEAKHOUSE, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
4. Long-term Debt
Long-term debt consisted of the following (in thousands):
September 30, December 31,
1997 1996
------------- ------------
(unaudited)
Notes payable to bank collateralized by
various items including property,
fixtures and equipment, fixed
and variable interest rates
ranging from 9.325% to 10.4%
at September 30, 1997...................... $ 1,181 $ 1,336
Notes payable to leasing companies, collater-
alized by equipment, interest at rates
ranging from 8% to 13.2%................... 15 127
Note payable to corporation, collaterized
by real estate, interest at 9.0%........... 305 455
Other notes payable, unsecured, interest
rates ranging from 5.35% to 7.99%.......... 950 1,063
Revolving line of credit, (see below)........ 84,744 45,320
------ -------
87,195 48,301
Less current portion 600 706
------- -------
Long-term debt $86,595 $47,595
======= =======
The Company has an unsecured revolving line of credit which permits
borrowing up to a maximum of $125,000,000 at rates ranging from 50 to 75 basis
points over the 30,60, 90 or 180 day London Interbank Offered Rate (LIBOR)
(6.28% to 6.47% at September 30, 1997). At September 30, 1997 the unused
portion of the revolving line of credit was $40,256,000. The line matures in
August 2000.
The Company has a $7,500,000 unsecured line of credit bearing
interest at rates ranging from 50 to 75 basis points over LIBOR.
Approximately $3,870,000 of the line of credit is committed for the issuance
of letters of credit, $463,000 of which is to secure loans made by the bank
to certain franchisees.
The Company is the guarantor of an unsecured line of credit which permits
borrowing of up to a maximum of $25,000,000, maturing in March 2002, for one
of its franchise groups. At September 30, 1997, the balance was approximately
$1,170,000.
See "Liquidity and Capital Resources" in Item 2. "Management's Discussion
and Analysis of Financial Condition and Results of Operations."
7 of 17<PAGE>
OUTBACK STEAKHOUSE, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
5. Accrued Expenses
Accrued expenses consisted of the following (in thousands):
September 30, December 31,
1997 1996
------------- ------------
(unaudited)
Accrued payroll................... $ 5,901 $ 4,624
Accrued advertising............... 6,385 2,876
Accrued rent...................... 947 1,148
Accrued insurance................. 4,219 4,490
Accrued property taxes............ 4,340 1,150
Other accrued expenses............ 1,119 4,920
-------- -------
$ 22,911 $ 19,208
======== ========
6. Treasury Stock
During the second quarter of 1997, the Company repurchased 735,500 shares
of Common Stock, $.01 par value, for an aggregate purchase price of
$13,900,000. Repurchased shares are carried as treasury stock on the balance
sheet and are recorded at cost.
8 of 17<PAGE>
OUTBACK STEAKHOUSE, INC.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Results of Operations
- ---------------------
The following table sets forth, for the periods indicated, (i) the
percentages which the items in the Company's Consolidated Statements of Income
bear to total revenues, or restaurant sales as indicated, and (ii) selected
operating data:
Three Months Ended Nine Months Ended
September 30, September 30,
------------------ -----------------
1997 1996 1997 1996
----- ----- ----- -----
REVENUES 100.0% 100.0% 100.0% 100.0%
COSTS AND EXPENSES:
Cost of revenues (1) 38.5 39.5 38.5 39.1
Labor & other related (1) 24.0 23.1 23.8 22.9
Other restaurant operating (1) 22.1 21.3 22.2 21.3
General & administrative 3.6 3.4 3.7 3.2
Loss (income) from operations of
unconsolidated affiliates 0.1 0.1
Total costs and expenses 87.5 86.8 87.7 86.0
----- ----- ----- -----
INCOME FROM OPERATIONS 12.5 13.2 12.3 14.1
INTEREST EXPENSE, NET (0.2) (0.2) (0.1)
----- ----- ----- -----
INCOME BEFORE ELIMINATION OF
MINORITY PARTNERS' INTEREST
AND INCOME TAXES 12.3 13.2 12.2 14.0
ELIMINATION OF MINORITY PARTNERS'
INTEREST 1.7 1.7 1.8 2.0
----- ----- ----- -----
INCOME BEFORE PROVISION FOR
INCOME TAXES 10.6 11.5 10.4 12.0
PROVISION FOR INCOME TAXES 3.6 4.0 3.7 4.3
----- ----- ----- -----
NET INCOME 7.0% 7.5% 6.7% 7.7%
===== ===== ===== =====
System-wide sales (millions of dollars):
Outback Steakhouses
Company owned restaurants $261.2 $225.3 $ 770.4 $659.7
Franchised restaurants 51.8 32.3 142.3 87.0
----- ----- ----- -----
Total 313.0 257.6 912.7 746.7
Carrabba's Italian Grills ----- ----- ----- -----
Company owned restaurants 25.7 9.6 70.9 25.0
Joint venture restaurants 6.2 5.2 18.2 15.6
----- ----- ----- -----
Total 31.9 14.8 89.1 40.6
----- ----- ----- -----
System-wide total $344.9 $272.4 $1,001.8 $787.3
====== ====== ======== ======
(1) As a percentage of restaurant sales.
9 of 17<PAGE>
Results of Operations (continued)
- ---------------------------------
September 30,
1997 1996
Number of restaurants (at end ----- -----
of the period):
Outback Steakhouses
Company owned restaurants 357 306
Domestic franchised restaurants 64 47
International franchised restaurants 10
--- ---
Total 431 353
--- ---
Carrabba's Italian Grills
Company owned restaurants 51 26
Joint venture restaurants 13 11
--- ---
Total 64 37
--- ---
System-wide total 495 390
=== ===
10 of 17<PAGE>
Three months ended September 30, 1997 and 1996
Revenues. Total revenues increased by 22.2% to $289,209,000
during the third quarter of 1997 as compared with $236,730,000 in the same
period in 1996. The increase was attributable to the opening of new
restaurants after September 30, 1996 and a 1.2% menu price increase in May
1997. The increase was partially offset by a 0.6% decrease in same-store
sales which resulted from lower customer counts during the quarter.
Costs and expenses. Costs of restaurant sales, consisting of
food and beverage costs, decreased in the third quarter of 1997 to 38.5% of
restaurant sales as compared with 39.5% in the same period in 1996. This
decrease resulted from commodity cost decreases in dairy and produce
products and price increases on certain Outback Steakhouse menu items.
Labor and other related expenses increased as a percentage of
restaurant sales by 0.9% to 24.0% in the third quarter of 1997 as compared
with 23.1% in the same period in 1996. Of the increase, 0.4% was
attributable to an increase in the proportion of Carrabba's in operation
which have higher average labor costs than Outback Steakhouses. The
remainder of the increase resulted from an overall increase in back of the
house wage rates due to a competitive labor market, the increase in the
minimum wage rate, and lower average unit volumes generated by Outback
Steakhouses.
Other restaurant operating expenses include all other unit-level
operating costs, the major components of which are operating supplies,
rent, repairs and maintenance, advertising expenses, utilities,
depreciation and amortization and other occupancy costs. A substantial
portion of these expenses are fixed or indirectly variable. These costs
increased by 0.8% of restaurant sales to 22.1% in the third quarter of
1997, as compared with 21.3% in the same period in 1996. Of the increase,
0.9% was attributable to an increase in the proportion of Carrabba's in
operation which have higher average operating expenses as a percentage of
sales than Outback Steakhouses. This increase was partially offset by an 0.1%
decrease in Outback Steakhouse's other restaurant operating expenses as a
percentage of restaurant sales.
General and administrative costs increased to 3.6% of revenues in
the third quarter of 1997 compared with 3.4% in 1996. This increase
resulted from an increase in salary expenses related to managers in
training, and additional staffs employed to manage Carrabba's and Outback
Steakhouse international franchise operations.
Loss (income) from operations of unconsolidated affiliates
represents the Company's portion of the loss or income from the Carrabba's
Italian Grills operated by the Texas joint venture. Loss from the Texas
joint venture was $118,000 during the third quarter of 1997 and $135,000
during the third quarter of 1996.
11 of 17<PAGE>
Income from operations. As a result of the increase in revenues,
the changes in the relationship between revenues and expenses discussed
above and the opening of new restaurants, income from operations increased
by $4,825,000, to $36,176,000, in the third quarter of 1997 as compared
with $31,351,000 in the same period in 1996.
Interest expense, net. Net interest expense was $632,000 during
the third quarter of 1997 as compared with net interest expense of $67,000
in the same period in 1996. Period to period changes in interest expense
reflected changes in available cash and cash equivalents, fluctuations in
interest rates on the Company's line of credit, and changes in borrowing
needs as funds were expended to finance new restaurants.
Elimination of minority interests. The costs included in this
line item represent the portion of income from operations included in
consolidated operating results attributable to the ownership interests of
restaurant managers and joint venture partners in Company owned
restaurants. As a percentage of revenues, these costs were 1.7% during
both of the quarters ended June 30, 1997 and 1996.
Provision for income taxes. The provision for income taxes in
both quarters reflected expected income taxes due at federal statutory
rates and state income tax rates, net of the federal benefit. The
effective income tax rates were 33.6% and 35.0% for the quarters ended
September 30, 1997 and 1996, respectively.
Net income and earnings per common share. Net income for the
third quarter of 1997 was $20,316,000 as compared with net income of
$17,712,000 in the same period in 1996, an increase of 14.7%. Earnings per
share increased to $0.41 during the third quarter of 1997 as compared with
earnings per share of $0.36 for the same period in 1996.
Nine months ended September 30, 1997 and 1996
Revenues. Total revenues increased by 23.0% to $847,975,000
during the first nine months of 1997 as compared with $689,313,000 in the
same period in 1996. The increase was attributable to the opening of new
restaurants after September 30, 1996 and a 1.2% menu price increase in May
of 1997. The increase was partially offset by a 1.3% decrease in same
store sales which resulted from lower customer check averages and lower
customer count during the third quarter of 1997. The Company has
experienced lower customer check averages during the first six months of 1997
after adding lower priced selections to the Outback Steakhouse menu. Check
averages increased during the third quarter after the Company raised prices
on certain items.
Costs and expenses. Cost of restaurant sales decreased by 0.6%
to 38.5% in the first nine months of 1997 as compared with 39.1% in the
same period in 1996. Of the decrease, 0.1% resulted from an increase in
the proportion of Company owned Carrabba's in operation which have lower
average food costs than Outback Steakhouses. The remainder of the decrease
resulted from commodity cost decreases in shrimp, produce and dairy products.
12 of 17<PAGE>
Labor and other related expenses increased as a percentage of
restaurant sales by 0.9% to 23.8% in the first nine months of 1997 as
compared with 22.9% in the same period in 1996. Of the increase, 0.4% was
attributable to an increase in the proportion of Carrabba's in operation
which have higher average labor costs than Outback Steakhouses. The
remainder of the increase resulted from an overall increase in back of the
house wage rates due to a competitive labor market, the increase in the
minimum wage rate, and lower average unit volumes generated by Outback
Steakhouses.
Other restaurant operating expenses increased by 0.9% of
restaurant sales to 22.2% in the first nine months of 1997 as compared with
21.3% in the same period in 1996. Of the increase, 0.7% was attributable to
an increase in the proportion of Carrabba's in operation which have higher
average operating expenses as a percentage of sales than Outback
Steakhouses. The remainder of the increase resulted from an increase in
advertising spending.
General and administrative costs increased to 3.7% of revenues
during the first nine months of 1997 as compared to 3.2% of revenues in the
same period in 1996. This increase resulted from an increase in salary
expenses related to managers in training, and additional staffs employed to
manage Carrabba's and Outback Steakhouse international franchising
operations.
(Loss) income from operations of unconsolidated affiliates
represents the Company's portion of the income from the Carrabba's Italian
Grills operated by the Texas joint venture and Outback Steakhouses operated
as development joint ventures. Loss from unconsolidated affiliates was
$532,000 in the first nine months of 1997 as compared with income of $11,000
in the same period in 1996. This decrease was attributable to losses from
Carrabba's Texas operations, and to fewer Outback Steakhouses operating as
development joint ventures as a result of the restructuring of the Company's
Nevada operations in April 1996.
Income from operations. As a result of the increase in revenues,
the changes in the relationship between revenues and expenses discussed
above and the opening of new restaurants, income from operations increased
by $7,617,000, to $104,448,000 in the first nine months of 1997 as compared
with $96,831,000 in the same period in 1996.
Interest expense, net. Net interest expense was $1,513,000 during
the first nine months of 1997 as compared with net interest expense of
$592,000 in the same period in 1996. Period to period changes in interest
expense reflected changes in available cash and cash equivalents,
fluctuations in interest rates on the Company's line of credit, and changes
in borrowing needs as funds were expended to finance new restaurants.
Elimination of minority interests. The costs included in this
line item represent the portion of income from operations included in
consolidated operating results attributable to the ownership interests of
restaurant managers and joint venture partners in Company owned restaurants.
As a percentage of revenues, these costs were 1.8% and 2.0% for the nine
months ended September 30, 1997 and 1996, respectively. The decrease in
this ratio reflected the decrease in overall operating margins.
13 of 17<PAGE>
Provision for income taxes. The provision for income taxes for
the nine months ended September 30, 1997 and 1996 reflected expected income
taxes due at federal statutory rates and state income tax rates, net of the
federal benefit. The effective income tax rates were 35.5% and 36.0% for
the nine months ended September 30, 1997 and 1996, respectively.
Net income and earnings per common share. Net income for the
first nine months of 1997 was $56,779,000 as compared with net income of
$52,805,000 in the same period in 1996, an increase of 7.5%. Earnings per
share increased to $1.17 during the first nine months of 1997 as compared
with earnings per share of $1.07 in the same period in 1996.
14 of 17<PAGE>
Liquidity and Capital Resources
- -------------------------------
The following table presents a summary of the Company's cash flows
from operating, investing and financing activities for the periods indicated
(in thousands).
Year Ended Nine Months Ended
---------------------------
December 31, September 30, September 30,
1996 1997 1996
----------- ------------ ------------
Net cash provided by
operating activities $ 122,799 $ 71,069 $ 72,572
Net cash used in investing
activities (126,631) (81,520) (74,117)
Net cash (used in) provided
by financing activities (7,596) 12,924 (2,436)
-------- ------- --------
Net (decrease) increase in
cash and cash equivalents $ (11,428) $ 2,473 $ (3,981)
========= ======= ========
The Company requires capital principally for the development of new
Company owned and joint venture restaurants. Capital expenditures totaled
approximately $130,987,000 for year ended December 31, 1996 and $83,538,000
and $77,020,000 during the first nine months of 1997 and 1996, respectively.
The Company either leases its restaurants under operating leases for periods
ranging from five to twenty years or purchases land and buildings where it
is cost effective. The Company anticipates that 80% to 90% of the Company
owned restaurants to be opened in 1997 will be free-standing units.
At September 30, 1997 the Company had two unsecured lines of credit
totaling $132,500,000. Approximately $3,870,000 is committed for the
issuance of letters of credit, some of which are to secure loans made by the
bank to certain franchisees, and $84,744,000 has been drawn by the Company
to finance capital expenditures. See Note 4 of Notes to Consolidated
Financial Statements.
The Company notes that a variety of factors could cause the actual
results and experience to differ from the anticipated results referred to in
the previous paragraphs. The Company's forward looking statements regarding
its development schedule for new restaurant openings are subject to a number
of risk factors including:
(i) Ability to secure appropriate real estate
sites at acceptable prices;
(ii) Ability to obtain all required governmental
permits including zoning approvals and liquor
licenses on a timely basis;
(iii)Impact of government moratoriums or approval processes
which could result in significant delays;
(iv) Ability to secure all necessary contractors
and sub-contractors;
(v) Union activities such as picketing and hand
billing which could delay construction;
(vi) Weather and acts of God beyond the Company's
control resulting in construction delays.
15 of 17<PAGE>
OUTBACK STEAKHOUSE, INC.
PART II: OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits
27- Financial Data Schedules (for SEC use only)
(b) Reports on Form 8-K
There were no reports filed on Form 8-K during
the quarter ended September 30, 1997.
16 of 17<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf of
the undersigned thereunto duly authorized.
OUTBACK STEAKHOUSE, INC.
------------------------
(Registrant)
Date: November 13, 1997 By:/s/Robert S. Merritt
----------------- -------------------
Robert S. Merritt
Senior Vice President,
Finance (Principal
Financial and Accounting
Officer)
17 of 17
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
EXHIBIT 27
<ARTICLE> 5
<MULTIPLIER> 1,000
<PERIOD-TYPE> QUARTER
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> SEP-30-1997
<CASH> 18,134
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 17,300
<CURRENT-ASSETS> 47,845
<PP&E> 544,541
<DEPRECIATION> 86,089
<TOTAL-ASSETS> 533,943
<CURRENT-LIABILITIES> 51,416
<BONDS> 86,595
0
0
<COMMON> 478
<OTHER-SE> 387,666
<TOTAL-LIABILITY-AND-EQUITY> 533,943
<SALES> 841,300
<TOTAL-REVENUES> 847,975
<CGS> 323,850
<TOTAL-COSTS> 711,281
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1,513
<INCOME-PRETAX> 88,020
<INCOME-TAX> 31,241
<INCOME-CONTINUING> 56,779
<DISCONTINUED> 0
<EXTRAORIDNARY> 0
<CHANGES> 0
<NET-INCOME> 56,779
<EPS-PRIMARY> 1.17
<EPS-DILUTED> 1.17
</TABLE>
