<PAGE> 1
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------------------------
FORM 10-Q
(Mark One)
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 23, 1996
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
------------ -----------
American Restaurant Group Holdings, Inc.
----------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 33-74012 33-0592148
- ------------------------------- ---------------- -------------------
(State or other jurisdiction of (Commission File (I.R.S. employer
incorporation or organization) Number) identification no.)
450 Newport Center Drive
Newport Beach, CA 92660
(714) 721-8000
-------------------------------------------------------------
(Address and telephone number of principal executive offices)
--------------------------------------------------
Former name, former address and former fiscal year
if changed since last report.
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
--------- ---------
The number of outstanding shares of the Company's Common Stock (one cent par
value) as of October 28, 1996 was 504,505.
<PAGE> 2
AMERICAN RESTAURANT GROUP HOLDINGS, INC.
INDEX
PAGE
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS:
Consolidated Condensed Balance Sheets . . . . . . . . . . . . . . . . . . . . . . . . 1
Consolidated Statements of Income . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Consolidated Statements of Cash Flows . . . . . . . . . . . . . . . . . . . . . . . . 4
Notes to Consolidated Condensed Financial Statements . . . . . . . . . . . . . . . . . 5
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS . . . . . . . . . . . . . . . . . . . . 6
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
</TABLE>
i
<PAGE> 3
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS:
AMERICAN RESTAURANT GROUP HOLDINGS, INC. AND SUBSIDIARIES
---------------------------------------------------------
CONSOLIDATED CONDENSED BALANCE SHEETS
-------------------------------------
DECEMBER 25, 1995 AND SEPTEMBER 23, 1996
----------------------------------------
<TABLE>
<CAPTION>
ASSETS December 25, September 23,
1995 1996
------------ ------------
(unaudited)
<S> <C> <C>
CURRENT ASSETS:
Cash $ 10,385,000 $ 6,060,000
Accounts receivable, net of reserve of
$777,000 and $849,000 at December 25, 1995
and September 23, 1996, respectively 7,734,000 7,720,000
Inventories 6,597,000 6,582,000
Prepaid expenses 4,607,000 2,624,000
------------ ------------
Total current assets 29,323,000 22,986,000
------------ ------------
PROPERTY AND EQUIPMENT:
Land and land improvements 52,991,000 23,163,000
Buildings and leasehold improvements 141,382,000 117,673,000
Fixtures and equipment 90,520,000 92,881,000
Property held under capital leases 13,067,000 13,067,000
Construction in progress 3,749,000 6,763,000
------------ ------------
301,709,000 253,547,000
Less -- Accumulated depreciation 130,679,000 127,894,000
------------ ------------
171,030,000 125,653,000
------------ ------------
OTHER ASSETS -- NET 54,138,000 54,659,000
------------ ------------
Total Assets $254,491,000 $203,298,000
============ ============
</TABLE>
The accompanying notes are an integral part of these
consolidated condensed statements.
(consolidated condensed balance sheets continued on the following page)
1
<PAGE> 4
<TABLE>
<CAPTION>
LIABILITIES AND COMMON STOCKHOLDERS' December 25, September 23,
EQUITY 1995 1996
------------ -------------
(unaudited)
<S> <C> <C>
CURRENT LIABILITIES:
Accounts payable $ 29,239,000 $ 30,649,000
Accrued liabilities 14,226,000 13,818,000
Accrued insurance 16,694,000 17,223,000
Accrued interest 5,855,000 509,000
Accrued payroll costs 10,171,000 11,016,000
Current portion of obligations
under capital leases 858,000 895,000
Current portion of long-term debt 7,850,000 124,000
------------ ------------
Total current liabilities 84,893,000 74,234,000
------------ ------------
LONG-TERM LIABILITIES, net of current portion:
Obligations under capital leases 9,344,000 8,670,000
Long-term debt 273,935,000 256,528,000
------------ ------------
Total long-term liabilities 283,279,000 265,198,000
------------ ------------
COMMITMENTS AND CONTINGENCIES
PREFERRED STOCK, $0.01 par value;
10,000 shares authorized, no shares
issued or outstanding
at December 25, 1995 or
September 23, 1996 - -
COMMON STOCKHOLDERS' EQUITY:
Common stock, $0.01 par value; 1,000,000
shares authorized; 504,505 shares issued
and outstanding at December 25, 1995 and
September 23, 1996 2,000 2,000
Treasury stock (50,000) (50,000)
Paid-in capital 17,539,000 17,539,000
Accumulated deficit (131,172,000) (153,625,000)
------------ ------------
Total common stockholders' deficit (113,681,000) (136,134,000)
------------ ------------
Total liabilities and common
stockholders' equity $254,491,000 $203,298,000
============ ============
</TABLE>
The accompanying notes are an integral part of these
consolidated condensed statements.
2
<PAGE> 5
AMERICAN RESTAURANT GROUP HOLDINGS, INC. AND SUBSIDIARIES
---------------------------------------------------------
CONSOLIDATED STATEMENTS OF INCOME
---------------------------------
FOR THE THIRTEEN WEEKS ENDED SEPTEMBER 25, 1995 AND SEPTEMBER 23, 1996
----------------------------------------------------------------------
AND THE THIRTY-NINE WEEKS ENDED SEPTEMBER 25, 1995 AND SEPTEMBER 23, 1996
-------------------------------------------------------------------------
(UNAUDITED)
-----------
<TABLE>
<CAPTION>
Thirteen Weeks Ended Thirty-Nine Weeks Ended
---------------------------------- ----------------------------------
September 25, September 23, September 25, September 23,
1995 1996 1995 1996
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
REVENUES $108,252,000 $107,319,000 $338,642,000 $332,988,000
RESTAURANT COSTS:
Food and beverage 33,287,000 33,802,000 104,501,000 105,473,000
Payroll 33,211,000 33,428,000 101,717,000 100,936,000
Direct operating 27,455,000 28,756,000 81,588,000 83,922,000
Depreciation and
amortization 5,576,000 5,179,000 17,461,000 15,486,000
GENERAL AND ADMINISTRATIVE
EXPENSES 7,028,000 6,755,000 23,166,000 20,021,000
------------ ------------ ------------ ------------
Operating profit (loss) 1,695,000 (601,000) 10,209,000 7,150,000
INTEREST EXPENSE, net 8,931,000 9,645,000 26,458,000 28,433,000
------------ ------------ ------------ ------------
Loss before provision
for income taxes and
extraordinary loss (7,236,000) (10,246,000) (16,249,000) (21,283,000)
PROVISION FOR INCOME
TAXES 14,000 15,000 53,000 75,000
------------ ------------ ------------ ------------
Loss before extraordinary
loss (7,250,000) (10,261,000) (16,302,000) (21,358,000)
Extraordinary loss on
extinguishment of debt - 1,095,000 - 1,095,000
------------ ------------ ------------ ------------
Net loss $ (7,250,000) $(11,356,000) $(16,302,000) $(22,453,000)
============ ============ ============ ============
</TABLE>
The accompanying notes are an integral part of these
consolidated condensed statements.
3
<PAGE> 6
AMERICAN RESTAURANT GROUP HOLDINGS, INC. AND SUBSIDIARIES
---------------------------------------------------------
CONSOLIDATED STATEMENTS OF CASH FLOWS
-------------------------------------
FOR THE THIRTY-NINE WEEKS ENDED SEPTEMBER 25, 1995 AND SEPTEMBER 23, 1996
-------------------------------------------------------------------------
(UNAUDITED)
-----------
<TABLE>
<CAPTION>
September 25, September 23,
1995 1996
------------ ------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Cash received from customers $339,178,000 $332,995,000
Cash paid to suppliers and employees (320,071,000) (313,070,000)
Interest paid, net (25,968,000) (26,390,000)
Income taxes paid (75,000) (75,000)
------------ ------------
Net cash used in operating activities (6,936,000) (6,540,000)
------------ ------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures (13,386,000) (8,138,000)
Net (increase) decrease in other assets 439,000 (1,858,000)
Proceeds from disposition of assets 28,000 49,433,000
------------ ------------
Net cash provided by (used in) investing activities (12,919,000) 39,437,000
------------ ------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Payments on indebtedness (277,000) (40,186,000)
Borrowings on indebtedness 11,000,000 7,664,000
Net increase in deferred debt costs (5,000) (4,063,000)
Payments on capital lease obligations (576,000) (637,000)
Purchase of treasury stock (50,000) -
------------- ------------
Net cash provided by (used in)
financing activities 10,092,000 (37,222,000)
------------ ------------
NET DECREASE IN CASH (9,763,000) (4,325,000)
CASH, at beginning of period 15,032,000 10,385,000
------------ ------------
CASH, at end of period $ 5,269,000 $ 6,060,000
============ ============
RECONCILIATION OF NET LOSS TO NET CASH
USED IN OPERATING ACTIVITIES:
Net loss $(16,302,000) $(22,453,000)
Adjustments to reconcile net loss to net cash
used in operating activities:
Extraordinary loss on
extinguishment of debt - 1,095,000
Depreciation and amortization 17,461,000 15,486,000
Loss on disposition of assets 3,000 412,000
Accretion on indebtedness 5,608,000 7,389,000
Loss on value of interest rate swap 95,000 -
(Increase) decrease in current assets:
Accounts receivable, net 536,000 7,000
Inventories 1,441,000 15,000
Prepaid expenses 81,000 1,551,000
Increase (decrease) in current liabilities:
Accounts payable (6,970,000) 1,410,000
Accrued liabilities (3,697,000) (7,480,000)
Accrued insurance 1,572,000 529,000
Accrued interest (5,213,000) (5,346,000)
Accrued payroll (1,551,000) 845,000
------------ ------------
Net cash used in operating activities $ (6,936,000) $ (6,540,000)
============ ============
</TABLE>
The accompanying notes are an integral part of these
consolidated condensed statements.
4
<PAGE> 7
AMERICAN RESTAURANT GROUP HOLDINGS, INC. AND SUBSIDIARIES
---------------------------------------------------------
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
----------------------------------------------------
1. MANAGEMENT OPINION
The Consolidated Condensed Financial Statements included herein have
been prepared by the Company, without audit, in accordance with
Securities and Exchange Commission Regulation S-X. In the opinion of
management of the Company, these Consolidated Condensed Financial
Statements contain all adjustments (all of which are of a normal
recurring nature) necessary to present fairly the Company's financial
position as of December 25, 1995 and September 23, 1996, and the
results of its operations and its cash flows for the thirty-nine weeks
ended September 25, 1995 and September 23, 1996. The Company's
results for an interim period are not necessarily indicative of the
results that may be expected for the year.
Although the Company believes that all adjustments necessary for a
fair presentation of the interim periods presented are included and
that the disclosures are adequate to make the information presented
not misleading, it is suggested that these Consolidated Condensed
Financial Statements be read in conjunction with the Consolidated
Financial Statements and notes thereto included in the Company's
annual report on Form 10-K, File No. 33-0592148, for the year ended
December 25, 1995 and the Company's current report on Form 8-K, File
No. 33-0592148, dated September 13, 1996.
5
<PAGE> 8
ITEM 2. MANAGEMENT'S DISCUSSION
AND ANALYSIS
OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
The following discussion and analysis of American Restaurant Group Holdings,
Inc.'s financial condition and results of operations should be read in
conjunction with the historical financial information included in the
Consolidated Condensed Financial Statements.
RESULTS OF OPERATIONS
Thirteen weeks ended September 25, 1995 and September 23, 1996:
Revenues. Total revenues decreased from $108.3 million in the third quarter of
1995 to $107.3 million in the third quarter of 1996 reflecting a decrease in
comparable restaurant revenues of 1.8%. During the twelve months ended
September 23, 1996, the Company opened three new restaurants and closed two
poor performing restaurants. There were 248 restaurants operating as of
September 25, 1995 and 249 operating as of September 23, 1996.
Black Angus revenues increased 4.2% to $59.9 million in the third quarter of
1996 as compared to the same period in 1995. The increase was due to the
addition of one new restaurant in Washington, one in Nevada, and one in Arizona
as well as increased television advertising. Comparable restaurant revenues
increased 2.4% as compared to the prior year.
Grandy's revenues decreased 10.3% to $22.8 million in the third quarter of 1996
as compared to the same period in 1995. Comparable restaurant revenues in the
third quarter of 1996 were 10.8% lower than the same period in 1995, in part
due to less use of discounting to stimulate sales and less effective
advertising and promotion. The Company closed two poor performing restaurants
during the twelve months ended September 23, 1996. Franchise revenues in the
third quarter increased due to international franchise fees.
Other revenues decreased from $25.4 million in the third quarter of 1995 to
$24.6 million in the same period of 1996. Comparable restaurant revenues
decreased 2.2%.
Food and Beverage Costs. As a percentage of revenues, food and beverage costs
increased from 30.7% in the third quarter of 1995 to 31.5% in the third quarter
of 1996. The increase was primarily due to higher seafood and grocery costs.
Payroll Costs. As a percentage of revenues, labor costs increased from 30.7%
in the third quarter of 1995 to 31.1% in the third quarter of 1996. The
increase was due to higher restaurant management payroll costs.
Direct Operating Costs. Direct operating costs consist of occupancy,
advertising and other expenses incurred by individual restaurants. As a
percentage of revenues, these costs increased in the third quarter from 25.4%
in 1995 to 26.8% in 1996. The increase was due primarily to higher advertising
expenses as well as occupancy expense which increased with the sale/leaseback
of 25 restaurants.
Depreciation and Amortization. Depreciation and amortization consists of
depreciation of fixed assets used by individual restaurants, divisions and
corporate offices, as well as amortization of intangible assets. As a
percentage of revenues, depreciation and amortization decreased from 5.2% in
the third quarter of 1995 to 4.8% in the same period
6
<PAGE> 9
of 1996. The decrease was due primarily to the non-cash reduction of the
historical cost of certain long-lived assets in December 1995.
General and Administrative Expenses. General and administrative expenses
decreased 3.9% from $7.0 million in the third quarter of 1995 to $6.8 million
in the third quarter of 1996. The decrease was due primarily to the December
1995 restructuring of administrative personnel which resulted in a reduction of
payroll costs. General and administrative expenses as a percentage of revenues
decreased from 6.5% to 6.3%.
Operating Profit. Due to the above items, operating profit decreased from $1.7
million in the third quarter of 1995 to an operating loss of $0.6 million in
the third quarter of 1996. A $0.3 million loss on the sale/leaseback of one
Spoons restaurant is included in 1996. As a percentage of revenues, operating
profit decreased from 1.5% to -0.6%.
Interest Expense - Net. Interest expense increased from $8.9 million in the
third quarter of 1995 to $9.6 million in the third quarter of 1996. The
increase was primarily due to a higher average debt balance in the third
quarter of 1996. The Company's average stated interest rate increased from
11.9% in the third quarter of 1995 to 12.3% in the third quarter of 1996. The
weighted average debt balance (excluding capitalized lease obligations)
increased from $273.5 million in the third quarter of 1995 to $292.1 million in
the third quarter of 1996.
Extraordinary Loss. An extraordinary loss of $1.1 million occurred in
September 1996 with the extinguishment of a bank loan and a portion of the
Company's senior secured notes. The extraordinary loss resulted in a non-cash
charge to expense for capitalized debt costs associated with the debt repaid.
Thirty-nine weeks ended September 25, 1995 and September 23, 1996:
Revenues. Total revenues decreased 1.7% from $338.6 million in the thirty-nine
weeks ended September 25, 1995 to $333.0 million in the thirty- nine weeks
ended September 23, 1996. Comparable restaurant revenues decreased 2.6%.
There were 248 restaurants operating as of September 25, 1995 and 249
restaurants operating as of September 23, 1996.
Black Angus revenues increased 3.5% to $191.1 million in 1996 as compared to
the same period in 1995, reflecting an increase in comparable restaurant
revenues of 1.5%. Comparable restaurant food sales increased 2.8% over the
prior year while beverage sales decreased 2.6% partially as a result of
deemphasizing the late-night lounge business and converting areas for late
night dancing into additional dining room seating. There were three new
restaurants operating in 1996.
Grandy's revenues decreased 12.5% from $78.1 million in 1995 to $68.3 million
in 1996. Comparable restaurant revenues were 12.3% lower than the prior year
for the reasons noted above. Franchise revenues were $2.1 million and $1.9
million in 1995 and 1996, respectively.
Other revenues decreased 3.0% from $75.8 million in 1995 to $73.5 million in
1996. Comparable restaurant revenues decreased 2.5%.
Food and Beverage Costs. Food and beverage costs as a percentage of revenues
increased from 30.9% in 1995 to 31.7% in 1996, due primarily to higher seafood
and grocery costs.
Payroll Costs. As a percentage of revenues, labor costs increased from 30.0%
in 1995 to 30.3% in 1996. The increase was due primarily to higher restaurant
management payroll costs.
7
<PAGE> 10
Direct Operating Costs. As a percentage of revenues, total direct operating
costs increased from 24.1% in 1995 to 25.2% in 1996. The increase was due
primarily to higher advertising expenses.
Depreciation and Amortization. As a percentage of revenues, depreciation and
amortization decreased from 5.2% in 1995 to 4.7% in 1996. As stated above, the
decrease was due primarily to the non-cash reduction of the historical cost of
certain long-lived assets in December 1995.
General and Administrative Expenses. General and administrative expenses
decreased 13.6% from $23.2 million in 1995 to $20.0 million in 1996. The
decrease was due primarily to the reduction of administrative payroll costs
mentioned above. General and administrative expenses as a percentage of
revenues were 6.8% and 6.0% for 1995 and 1996, respectively.
Operating Profit. Due to the items mentioned above, operating profit decreased
from $10.2 million in 1995 to $7.2 million in 1996. As a percentage of
revenues, operating profit decreased from 3.0% to 2.1%.
Interest Expense. Interest expense increased from $26.5 million in 1995 to
$28.4 million in 1996. The Company's average stated interest rate increased
from 11.9% in 1995 to 12.1% in 1996. Average borrowings (excluding capitalized
lease obligations) increased from $270.4 million in 1995 to $289.2 million in
1996.
Extraordinary Loss. As stated above, the extraordinary loss was the result of
a non-cash charge to expense for capitalized debt costs associated with the
debt repaid in September 1996.
LIQUIDITY AND CAPITAL RESOURCES
The Company's primary sources of liquidity are cash flow from operations and
borrowings under its credit facilities. The Company requires capital
principally for the acquisition and construction of new restaurants, the
remodeling of existing restaurants and the purchase of new equipment and
leasehold improvements.
In general, restaurant businesses do not have significant accounts receivable
because sales are made for cash or by credit card vouchers which are ordinarily
paid within a few days, and do not maintain substantial inventory as a result
of the relatively brief shelf life and frequent turnover of food products.
Additionally, restaurants generally are able to obtain trade credit in
purchasing food and restaurant supplies. As a result, restaurants are
frequently able to operate with working capital deficits, i.e., current
liabilities exceed current assets. At September 23, 1996, the Company had a
working capital deficit of $51.2 million.
The Company estimates that capital expenditures of $10.0 million to $13.0
million are required annually to maintain and refurbish its existing
restaurants. In addition, the Company spends approximately $10.0 million to
$13.0 million annually for repairs and maintenance which are expensed as
incurred. Other capital expenditures, which are generally discretionary, are
primarily for the construction of new restaurants and for expanding,
reformatting and extending the capabilities of existing restaurants and for
general corporate purposes. The Company expects to spend approximately $3.0
million to $6.0 million on new restaurants in 1996, primarily during the second
half of 1996, and depending on market conditions, to increase its capital
expenditures for new restaurants thereafter. Total capital expenditures year
to date were $13.4 million in 1995 and $8.1 million in 1996. The Company's
credit agreement contains limitations on the amount of capital expenditures
that the Company may incur.
8
<PAGE> 11
On August 28, 1996, the senior secured note holders of American Restaurant
Group, Inc. ("ARG"), a wholly owned subsidiary of the Company, consented to an
amendment which increased the interest rate from 12% to 13% and changed
interest payment dates from semi-annual to quarterly beginning December 15,
1996. The consent also replaced a net worth covenant with an EBITDA covenant
and requires the Company to consummate asset sales or sale/leaseback
transactions prior to December 31, 1996. After completing the sale/leaseback
of the 24 restaurants mentioned below, the Company is required to generate net
cash proceeds from additional asset sales or sale/leasebacks of $25.0 million.
On September 13, 1996, ARG completed a sale/leaseback transaction under which
it sold the real property relating to 24 Stuart Anderson's Black Angus and
Stuart Anderson's Cattle Company restaurants for an aggregate sales price of
$48.1 million and simultaneously executed long-term leases under which it will
continue to operate the restaurants.
The proceeds of the transaction have been applied in accordance with the
requirements of ARG's debt instruments, as follows: to redeem at par principal
and interest thereon of ARG's senior secured notes in the amount of $34.3
million; to repay bank debt and to partially cash collateralize outstanding
letters of credit in a combined amount of $4.8 million; for fees and expenses
of this transaction as well as ARG's recently completed consent solicitation in
a total amount of $4.6 million; and $4.4 million retained by ARG to be invested
in productive assets within six months.
ARG's senior credit facilities provide for a letter of credit facility of $13.5
million until March 31, 1997. This letter of credit facility was fully
utilized as of September 23, 1996. Having repaid the outstanding bank loan
mentioned above, the Company does not have a working capital facility.
Although the Company is highly leveraged, based upon current and projected
levels of operations and anticipated growth, the Company expects that cash flow
generated from operations together with its other available sources of
liquidity, including additional asset sales or sale/leaseback transactions,
will be adequate to make required payments of principal and interest on its
indebtedness, to make anticipated capital expenditures and to finance working
capital requirements.
The Company expects to pursue additional sale/leaseback transactions in the
immediate future subject to completion on terms acceptable to the Company.
Thus, although the Company expects such transactions to be completed, there can
be no assurance of such completion on acceptable terms.
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) List of Exhibits
<TABLE>
<CAPTION>
Exhibit No. Description
----------- -----------
<S> <C>
27.1 Financial Data Schedule, which is submitted
electonically to the Securities and Exchange
Commission for information only.
</TABLE>
(b) Reports on Form 8-K
The Company filed a current report on Form 8-K dated September 13,
1996, with the Securities and Exchange Commission relating to the
sale/leaseback transaction of 24 restaurants as mentioned above.
9
<PAGE> 12
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 GROUP HOLDINGS, INC.
----------------------------------------
(Registrant)
Date: November 4, 1996 By: /s/ WILLIAM J. MCCAFFREY, JR.
------------------------------
William J. McCaffrey, Jr.
Vice President, Chief
Financial Officer
10
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONSOLIDATED BALANCE SHEET AS OF SEPTEMBER 23, 1996 AND THE CONSOLIDATED
STATEMENT OF INCOME FOR THE THIRTY-NINE WEEKS ENDED SEPTEMBER 23, 1996 AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH CONSOLIDATED FINANCIAL STATEMENTS
ON FORM 10-Q.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-30-1996
<PERIOD-START> DEC-26-1995
<PERIOD-END> SEP-23-1996
<CASH> 6,060,000
<SECURITIES> 0
<RECEIVABLES> 8,569,000
<ALLOWANCES> 849,000
<INVENTORY> 6,582,000
<CURRENT-ASSETS> 22,986,000
<PP&E> 253,547,000
<DEPRECIATION> 127,894,000
<TOTAL-ASSETS> 203,298,000
<CURRENT-LIABILITIES> 74,234,000
<BONDS> 0
0
0
<COMMON> 2,000
<OTHER-SE> (136,136,000)
<TOTAL-LIABILITY-AND-EQUITY> 203,298,000
<SALES> 332,988,000
<TOTAL-REVENUES> 332,988,000
<CGS> 105,473,000
<TOTAL-COSTS> 305,817,000
<OTHER-EXPENSES> 20,021,000
<LOSS-PROVISION> 83,000
<INTEREST-EXPENSE> 28,433,000
<INCOME-PRETAX> (21,283,000)
<INCOME-TAX> 75,000
<INCOME-CONTINUING> (21,358,000)
<DISCONTINUED> 0
<EXTRAORDINARY> (1,095,000)
<CHANGES> 0
<NET-INCOME> (22,453,000)
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
