UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
|X| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended June 27, 2009
OR
|_| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
Commission File Number 1-6836
FLANIGAN'S ENTERPRISES, INC.
----------------------------
(Exact name of registrant as specified in its charter)
Florida 59-0877638
------------------------------- ---------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
5059 N.E. 18th Avenue, Fort Lauderdale, Florida 33334
----------------------------------------------- -----
(Address of principal executive offices) Zip Code
(954) 377-1961
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(Registrant's telephone number, including area code)
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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 by check mark whether the registrant has submitted electronically and
posted on its Web site, if any, every Interactive Data File required to be
submitted and posted pursuant to Rule 405 of Regulation S-T (ss.232.405 of this
chapter) during the preceding 12 months (or for such shorter period that the
registrant was required to submit and post such files).
Yes |_| No |_|
Indicate by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company. See
the definitions of "large accelerated filer", "accelerated filer" and "smaller
reporting company in Rule 12b-2 of the Exchange Act. (Check one):
Large accelerated filer |_| Accelerated filer |_|
Non-accelerated filer |_| Smaller reporting company |X|
Indicate by check mark whether the registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act).
Yes |_| No |X|
On August 11, 2009, 1,862,933 shares of Common Stock, $0.10 par value per share,
were outstanding.
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FLANIGAN'S ENTERPRISES, INC. AND SUBSIDIARIES
INDEX TO FORM 10-Q
PART I. FINANCIAL INFORMATION.....................................................................................1
ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED).............................................1
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME....................................................2
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS..........................................................4
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS................................................6
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS...........................................8
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS..............14
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.........................................25
ITEM 4. CONTROLS AND PROCEDURES............................................................................26
PART II. OTHER INFORMATION.......................................................................................26
ITEM 1. LEGAL PROCEEDINGS..................................................................................26
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS........................................26
ITEM 6. EXHIBITS............................................................................................28
As used in this Quarterly Report on Form 10-Q, the terms "we," "us," "our," the
"Company" and "Flanigan's" mean Flanigan's Enterprises, Inc. and its
subsidiaries (unless the context indicates a different meaning).
PART I. FINANCIAL INFORMATION
ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
FLANIGAN'S ENTERPRISES, INC. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In Thousands Except Per Share Amounts)
Thirteen Weeks Thirty Nine Weeks
Ended Ended
June 27, June 28, June 27, June 28,
2009 2008 2009 2008
---- ---- ---- ----
REVENUES:
Restaurant food sales $ 10,653 $ 10,182 $ 32,020 $ 30,714
Restaurant bar sales 2,536 2,346 7,608 7,117
Package store sales 2,925 2,842 9,788 9,673
Franchise related revenues 298 273 842 815
Owner's fee 40 68 129 183
Other operating income 39 54 114 150
----------- ----------- ----------- -----------
16,491 15,765 50,501 48,652
----------- ----------- ----------- -----------
COSTS AND EXPENSES:
Cost of merchandise sold:
Restaurant and lounges 4,582 4,197 13,470 12,670
Package goods 1,968 1,994 6,740 6,855
Payroll and related costs 4,885 4,645 14,700 14,363
Occupancy costs 988 989 2,962 2,969
Selling, general and administrative expenses 3,418 3,289 10,476 9,994
----------- ----------- ----------- -----------
15,841 15,114 48,348 46,851
----------- ----------- ----------- -----------
Income from Operations 650 651 2,153 1,801
----------- ----------- ----------- -----------
OTHER INCOME (EXPENSE):
Interest expense (105) (117) (332) (358)
Interest and other income 15 34 200 71
----------- ----------- ----------- -----------
(90) (83) (132) (287)
----------- ----------- ----------- -----------
Income before Provision for Income Taxes
and Minority Interest in (Earnings) Losses of
Consolidated Limited Partnerships 560 568 2,021 1,514
Provision for Income Taxes (104) (138) (299) (487)
Minority Interest in (Earnings) Losses of
Consolidated Limited Partnerships (145) (94) (555) (36)
----------- ----------- ----------- -----------
NET INCOME $ 311 $ 336 $ 1,167 $ 991
=========== =========== =========== ===========
2
FLANIGAN'S ENTERPRISES, INC. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In Thousands Except Per Share Amounts)
(Continued)
Thirteen Weeks Thirty Nine Weeks
Ended Ended
June 27, June 28, June 27, June 28,
2009 2008 2009 2008
---- ---- ---- ----
Net Income Per Common Share:
Basic $ 0.17 $ 0.18 $ 0.62 $ 0.52
=========== =========== =========== ===========
Diluted $ 0.17 $ 0.18 $ 0.62 $ 0.52
=========== =========== =========== ===========
Weighted Average Shares and Equivalent
Shares Outstanding
Basic 1,863,007 1,886,077 1,870,147 1,888,523
=========== =========== =========== ===========
Diluted 1,863,007 1,895,378 1,870,147 1,899,515
=========== =========== =========== ===========
See accompanying notes to unaudited condensed consolidated financial statements.
3
FLANIGAN'S ENTERPRISES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
JUNE 27, 2009 (UNAUDITED) AND SEPTEMBER 27, 2008
(In Thousands)
ASSETS
June 27, 2009 September 27, 2008
------------- ------------------
CURRENT ASSETS:
Cash and cash equivalents $ 4,945 $ 3,244
Notes receivables, current maturities, net 18 16
Prepaid income taxes 235 176
Due from franchisees 128 351
Other receivables 131 107
Inventories 2,146 2,168
Prepaid expenses 1,099 778
Deferred tax asset 216 243
------- -------
Total Current Assets 8,918 7,083
------- -------
Property and Equipment, Net 21,425 21,601
------- -------
Investment in Limited Partnership 144 151
------- -------
OTHER ASSETS:
Liquor licenses, net 345 345
Notes receivable, net 15 28
Deferred tax asset 792 729
Leasehold purchases, net 1,695 1,880
Other 869 987
------- -------
Total Other Assets 3,716 3,969
------- -------
Total Assets $34,203 $32,804
======= =======
4
FLANIGAN'S ENTERPRISES, INC, AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
JUNE 27, 2009 (UNAUDITED) AND SEPTEMBER 27, 2008
(In Thousands)
(Continued)
LIABILITIES AND STOCKHOLDERS' EQUITY
June 27, 2009 September 27, 2008
------------- ------------------
CURRENT LIABILITIES:
Accounts payable and accrued expenses $ 4,094 $ 4,040
Due to franchisees 501 223
Current portion of long term debt 771 419
Current portion of line of credit 1,586 --
Deferred revenues 25 34
Deferred rent 24 19
-------- --------
Total Current Liabilities 7,001 4,735
-------- --------
Long Term Debt, Net of Current Maturities 4,706 4,764
Line of Credit -- 1,562
Deferred Rent, Net of Current Portion 211 214
Minority Interest in Equity of
Consolidated Limited Partnerships 8,113 8,437
Commitments and Contingencies
Stockholders' Equity:
Common stock, $.10 par value, 5,000,000
shares authorized; 4,197,642 shares issued 420 420
Capital in excess of par value 6,240 6,240
Retained earnings 13,555 12,388
Treasury stock, at cost, 2,334,709 shares
at June 27, 2009 and 2,313,309
shares at September 27, 2008 (6,043) (5,956)
-------- --------
Total Stockholders' Equity 14,172 13,092
-------- --------
Total Liabilities and Stockholders' Equity $ 34,203 $ 32,804
======== ========
See accompanying notes to unaudited condensed consolidated financial statements.
5
FLANIGAN'S ENTERPRISES, INC. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE THIRTY-NINE WEEKS ENDED JUNE 27, 2009 AND JUNE 28, 2008
(In Thousands)
June 27, 2009 June 28, 2008
------------- -------------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 1,167 $ 991
Adjustments to reconcile net income to net cash
and cash equivalents provided by operating activities:
Depreciation and amortization 1,708 1,518
Amortization of leasehold purchases 159 174
Loss on abandonment of property and equipment 34 15
Deferred income tax (36) (144)
Deferred rent 2 (13)
Minority interest in earnings of
consolidated limited partnerships 555 36
Income from unconsolidated limited partnership (2) (22)
Recognition of deferred revenue (9) (8)
Changes in operating assets and liabilities:
(increase) decrease in
Due from franchisees 223 498
Other receivables (24) (22)
Prepaid income taxes (59) (100)
Inventories 22 (72)
Prepaid expenses 615 261
Other assets (7) (137)
Increase (decrease) in:
Accounts payable and accrued expenses 54 (165)
Income taxes payable -- (331)
Due to franchisees 278 27
------- -------
Net cash and cash equivalents provided by operating
activities: 4,680 2,506
------- -------
CASH FLOWS FROM INVESTING ACTIVITIES:
Collection on notes and mortgages receivable 11 10
Purchase of property and equipment (1,246) (2,916)
Deposit on property and equipment (64) (27)
Proceeds from the sale of fixed assets 53 101
Distributions from unconsolidated limited Partnerships 9 9
------- -------
Net cash and cash equivalents used in investing Activities: (1,237) (2,823)
------- -------
6
FLANIGAN'S ENTERPRISES, INC. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE THIRTY-NINE WEEKS ENDED JUNE 27, 2009 AND JUNE 28, 2008
(In Thousands)
(Continued)
June 27, 2009 June 28, 2008
------------- -------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Payment of long term debt (800) (148)
Proceeds from line of credit 24 600
Purchase of treasury stock (87) (40)
Purchase of minority limited partnership interest -- (120)
Distributions to limited partnership
minority partners (879) (759)
Proceeds from limited partnership interests -- 2,025*
---------- ----------
Net cash and cash equivalents provided by (used in)
financing activities: (1,742) 1,558
---------- ----------
Net Increase in Cash and Cash Equivalents 1,701 1,241
Beginning of Period 3,244 2,223
---------- ----------
End of Period $ 4,945 $ 3,464
========== ==========
Supplemental Disclosure for Cash Flow Information:
Cash paid during period for:
Interest $ 332 $ 358
========== ==========
Income taxes $ 435 $ 1,061
========== ==========
Supplemental Disclosure of Non-Cash Investing and
Financing Activities:
Financing of insurance contracts $ 1,094 --
========== ==========
Purchase deposits transferred to property and equipment $ 292 --
========== ==========
Purchase of vehicle in exchange for debt $ -- $ 26
========== ==========
* exclusive of the Company's investment in the limited partnership owning
the restaurant in Davie, Florida of $1,850,000.
See accompanying notes to unaudited condensed consolidated financial statements
7
FLANIGAN'S ENTERPRISES, INC. AND SUBSIDIARIES
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
JUNE 27, 2009
(1) BASIS OF PRESENTATION:
The accompanying financial information for the periods ended June 27, 2009 and
June 28, 2008 are unaudited. Financial information as of September 27, 2008 has
been derived from the audited financial statements of the Company, but does not
include all disclosures required by generally accepted accounting principles. In
the opinion of management, all adjustments, consisting of normal recurring
adjustments, necessary for a fair presentation of the financial information for
the periods indicated have been included. For further information regarding the
Company's accounting policies, refer to the Consolidated Financial Statements
and related notes included in the Company's Annual Report on Form 10-K for the
year ended September 27, 2008. Operating results for interim periods are not
necessarily indicative of results to be expected for a full year.
These financial statements include estimates relating to performance based
officers' bonuses. The estimates are reviewed periodically and the effects of
any revisions are reflected in the financial statements in the period they are
determined to be necessary. Although these estimates are based on management's
knowledge of current events and actions it may take in the future, they may
ultimately differ from actual results.
(2) EARNINGS PER SHARE:
Statements of Financial Accounting Standards ("SFAS") No. 128, Earnings per
share establishes standards for computing and presenting earnings per share
("EPS"). This statement requires the presentation of basic and diluted EPS. The
data on Page 3 shows the amounts used in computing earnings per share and the
effects on income and the weighted average number of shares of potentially
dilutive common stock equivalents. As of June 27, 2009, no stock options were
outstanding.
(3) RECLASSIFICATION:
Certain amounts in the fiscal year 2008 financial statements have been
reclassified to conform to the fiscal year 2009 presentation.
(4) RECENT ACCOUNTING PRONOUNCEMENTS:
In June 2009, the FASB issued SFAS No. 168, "The FASB Accounting Standards
Codification (Codification) and the Hierarchy of GAAP" (SFAS No. 168), which
replaces SFAS No. 162, "The Hierarchy of GAAP". SFAS No. 168 establishes the
Codification as the single official source of authoritative U.S. GAAP recognized
by the FASB to be applied by nongovernmental entities. SEC rules and
interpretive releases are also sources of authoritative GAAP for SEC
registrants. SFAS No. 168 modifies the GAAP hierarchy to include only two levels
of GAAP: authoritative and non-authoritative. SFAS No. 168 is effective for
interim and annual periods ended after September 15, 2009 and we expect to adopt
the use of the Codification for our fiscal year ended October 3, 2009. As SFAS
No. 168 is not intended to change or alter existing GAAP, it will not impact our
financial condition, results of operations and cash flows, but it will impact
our financial statement disclosures, as all future references to authoritative
literature will be references in accordance with the Codification.
8
In June 2009, the FASB issued SFAS No. 167, "Amendments to FASB Interpretation
No. 46" ("SFAS 167") which amends the guidance in FASB Interpretation No. 46(R),
"Consolidation of Variable Interest Entities", for determining whether an entity
is a variable interest entity and modifies the methods allowed for determining
the primary beneficiary of a variable interest entity. In addition, SFAS No. 167
requires ongoing reassessments of whether an enterprise is the primary
beneficiary of a variable interest entity and enhanced disclosures related to an
enterprise's involvement in a variable interest entity. SFAS No. 167 is
effective for interim and annual periods beginning after November 15, 2009 and
will be adopted by us in the second quarter of our fiscal year 2010. We are
currently evaluating the potential impact, if any, of the adoption of SFAS No.
167 on consolidated results of operations and financial condition.
In May 2009, the FASB issued SFAS No. 165, "Subsequent Events" ("FAS 165"),
which introduces the concept of financial statements being available to be
issued and requires the disclosure of the date through which an entity has
evaluated subsequent events and the basis for that date as either the date the
financial statements were issued or were available to be issued. We adopted this
standard in our fiscal quarter ended June 27, 2009. The implementation of this
standard did not have a significant impact on our financial condition, results
of operations or cash flows. We evaluated all events and transactions that
occurred after June 27, 2009 up through August 11, 2009, the date we issued
these financial statements. During this period, we did not have any material
recognizable subsequent events. See Note 10.
In March 2008, the FASB issued SFAS No. 161 "Disclosures about Derivative
Instruments and Hedging Activities" ("SFAS 161") to enhance disclosures about an
entity's derivative and hedging activities. SFAS 161 is effective for all
financial statements issued in fiscal years and interim periods beginning after
November 15, 2008 and early application is encouraged. SFAS 161 also encourages
but does not require comparative disclosures for earlier periods at initial
adoption. As we do not currently engage in derivative transactions or hedging
activities, we do not anticipate any significant financial statement disclosure
impact as a result of our evaluation of SFAS 161.
In February 2008, the FASB issued FASB Staff Position No. FAS 157-2 ("FSP
157-2"). FSP 157-2 delays the implementation of SFAS 157 for nonfinancial assets
and nonfinancial liabilities, except for items that are recognized or disclosed
at fair value in the financial statements on a recurring basis. This statement
defers the effective date to fiscal years beginning after November 15, 2008 and
interim periods within those fiscal years, which is fiscal year 2010 for the
Company.
In December 2007, the FASB issued SFAS No. 141 (revised 2007), "Business
Combinations" ("SFAS 141R"). SFAS 141R establishes principles and requirements
for how an acquirer recognizes and measures in its financial statements the
identifiable assets acquired, the liabilities assumed, any noncontrolling
interest in the acquiree and the goodwill acquired. SFAS 141R also establishes
disclosure requirements to enable the evaluation of the nature and financial
effects of the business combination. SFAS 141R is effective for the fiscal years
beginning after December 15, 2008 and will be adopted by us in the first quarter
of our fiscal year 2010. We are currently evaluating the potential impact, if
any, of the adoption of SFAS 141R on our consolidated results of operations and
financial condition.
In December 2007, the FASB issued Statement of Financial Accounting Standard No.
160, Noncontrolling Interests in Consolidated Financial Statements, an amendment
of ARB No. 51 ("SFAS 160"). SFAS 160 will change the accounting and reporting
for minority interests, which will be recharacterized as noncontrolling
interests (NCI) and classified as a component of equity. This new consolidation
method will significantly change the accounting for transactions with minority
interest holders. SFAS 160 is effective for fiscal years beginning after
December 15, 2008 (our fiscal year 2010). We have not yet determined the impact
of SFAS 160 on our consolidated financial statements.
Other accounting standards that have been issued or proposed by the FASB or
other standard-setting bodies that do not require adoption until a future date
are not expected to have a material impact on our consolidated financial
statements.
9
(5) DEBT:
Line of Credit
Under a secured line of credit with a third party financial institution we are
able to borrow up to $2,500,000. The outstanding balance on our line of credit
bears interest at BBA LIBOR 1 month rate, plus 2.25%, (2.567% as of June 27,
2009), with monthly payments of interest only and the unpaid principal balance
and any accrued interest due in full on October 7, 2009. We granted our lender a
security interest in substantially all of our assets and a second mortgage on
our corporate offices as collateral to secure our repayment obligations under
our credit line. During the third quarter of fiscal year 2009, we made no draws
on our line of credit and paid monthly installments of interest, with no
principal payments. As of June 27, 2009, the amount outstanding under the line
of credit was $1,586,000, with a remaining availability of $914,000.
Financed Insurance Premiums
(i) For the policy year beginning December 30, 2008, our property insurance is a
two (2) year policy with our insurance carrier. The two (2) year property
insurance premium is in the amount of $631,000 and is financed in full through
an unrelated third party lender. The finance agreement earns interest at the
rate of 5.15% per annum and is amortized over 20 months, with monthly payments
of principal and interest, each in the amount of $30,000. The finance agreement
is secured by a security interest in all insurance policies, all unearned
premium, return premium, dividend payments and loss payments thereof.
(ii) For the policy year beginning December 30, 2008, our general liability
insurance, excluding limited partnerships, is a one (1) year policy with our
insurance carriers, including automobile and excess liability coverage. The one
(1) year general liability insurance premiums, including automobile and excess
liability coverage, is in the aggregate amount of $249,000 and is financed in
full through the same unrelated third party lender. The finance agreement earns
interest at the rate of 4.15% per annum and is amortized over 10 months, with
monthly payments of principal and interest, each in the amount of $23,000. The
finance agreement is secured by a security interest in all insurance policies,
all unearned premium, return premium, dividend payments and loss payments
thereof.
(iii) For the policy year beginning December 30, 2008, our general liability
insurance for our limited partnerships is a one (1) year policy with our
insurance carriers, including excess liability coverage. The one (1) year
general liability insurance premiums, including excess liability coverage, is in
the aggregate amount of $214,000 and is financed in full through the same
unrelated third party lender. The finance agreement earns interest at the rate
of 4.05% per annum and is amortized over 10 months, with monthly payments of
principal and interest, each in the amount of $19,000. The finance agreement is
secured by a security interest in all insurance policies, all unearned premium,
return premium, dividend payments and loss payments thereof.
As of June 27, 2009, the aggregate principal balance from the financing of our
property and general liability insurance policies is $661,000.
(6) INCOME TAXES:
Financial Accounting Standards Board Statement No. 109, Accounting for Income
Taxes, requires among other things, recognition of future tax benefits measured
at enacted rates attributable to deductible temporary differences between
financial statement and income tax basis of assets and liabilities and to tax
net operating loss carryforwards and tax credits to the extent that realization
of said tax benefits is more likely than not.
The Company's effective tax rate, (after consideration of minority interest in
earnings of consolidated limited partnerships), was 25.1% and 29.1% for the
thirteen weeks ended June 27, 2009 and June 28, 2008, respectively, and 20.3%
and 32.9% for the thirty nine weeks ended June 27, 2009 and June 28, 2008,
respectively. The Company's effective tax rate differs from the statutory rate
primarily due to various non-deductible expense items, state income taxes and
credits against income taxes. In addition, for the thirteen and thirty nine
weeks ended June 27, 2009, the effective tax rate also differs from the
statutory rate due to an adjustment of the joint venture deferred tax asset.
10
(7) STOCK OPTION PLANS:
We have one stock option plan under which qualified stock options may be granted
to our officers and other employees. Under this plan, the exercise price for the
qualified stock options must be no less than 100% of the fair market value of
the Company's Common Stock on the date the options are granted. In general,
options granted under our stock option plan expire after a five (5) year period
and generally vest no later than one (1) year from the date of grant. As of June
27, 2009, no options to acquire shares were outstanding. Under this plan,
options to acquire an aggregate of 45,000 shares are available for grant.
No stock options were granted during the thirty nine weeks ended June 27, 2009,
nor were stock options granted during the thirty nine weeks ended June 28, 2008.
No stock options were exercised during the thirty nine weeks ended June 27,
2009, nor were stock options exercised during the thirty nine weeks ended June
28, 2008.
Stock option activity during the thirty nine weeks ended June 27, 2009 was as
follows:
Weighted Average
Total Options Exercise Price
------------- --------------
Outstanding at September 27, 2008 49,350 $6.31
Granted -- --
Exercised -- --
Expired (49,350) 6.31
------- ----
Outstanding at June 27, 2009 -- --
Options exercisable at June 27, 2009 -- --
(8) ACQUISITIONS:
Purchase of Company Common Stock
Pursuant to a discretionary plan approved by the Board of Directors at its
meeting on May 17, 2007, during the third quarter ended June 27, 2009, we
purchased 325 shares of our common stock for an aggregate purchase price of
$2,000 from an employee. During the thirty nine weeks ended June 27, 2009, we
purchased 21,400 shares of our common stock for an aggregate purchase price of
$87,000. Of the shares purchased, we purchased 20,225 shares of our common stock
on the open market for an aggregate purchase price of $81,000, 325 shares of our
common stock from an employee for a purchase price of $2,000 and 850 shares of
our common stock from the Joseph G. Flanigan Charitable Trust for a purchase
price of $4,000.
(9) COMMITMENTS AND CONTINGENCIES:
Guarantees
We guarantee various leases for franchisees, limited partnerships that own
restaurants and locations sold in prior years. Remaining rental commitments
required under these leases are approximately $1,974,000. In the event of a
default under any of these agreements, we will have the right to repossess the
premises and operate the business to recover amounts paid under the guarantee
either by liquidating assets or operating the business.
During the third quarter of our fiscal year 2009, we guaranteed a loan from an
unrelated third party to a related franchisee, in the principal amount of
$200,000, bearing interest at the rate of 10% per annum and being fully
amortized over five (5) years, with equal monthly payments of principal and
interest, each in the amount of $4,250. The franchisee granted the lender a
security interest in substantially all of its assets as collateral to secure the
repayment of the loan. The proceeds from the loan are being used to re-finance
existing loans owed by the franchisee, (approximately $75,000), reimburse us for
funds advanced to the franchisee to renovate the business premises,
(approximately $90,000) and provide additional working capital for the
franchisee.
Litigation
We own the building where our corporate offices are located. On April 16, 2001,
we filed suit against the owner of the adjacent shopping center to determine our
right to non-exclusive parking in the shopping center. During fiscal year 2007,
the appellate court affirmed and upon re-hearing, again affirmed the granting of
a summary judgment in favor of the shopping center. The seller from whom we
purchased the
11
building was named as a defendant in the lawsuit and is currently asserting a
claim against us for reimbursement of its attorneys' fees and costs resulting
from the litigation. We disputed the seller's entitlement to reimbursement of
its attorney's fees and costs, but during the first quarter of our fiscal year
2009, the appellate court affirmed the ruling against us by the trial court. We
are disputing the amount of the seller's claim as excessive. A hearing on the
seller's claim for reimbursement of its attorney's fees and costs was held
during the third quarter of our fiscal year 2009, but the court has not yet
issued its order. During the second quarter of our fiscal year 2009, the seller
filed suit against the Company for malicious prosecution. We deny the
allegations and will vigorously defend the case.
During fiscal year 2007, we and the limited partnership which owns the
restaurant in Pinecrest, Florida filed suit against the limited partnership's
landlord. We are the sole general partner and a 40% limited partner in this
limited partnership. We are seeking to recover the cost of structural repairs to
the business premises we paid, as we believe these structural repairs were the
landlord's responsibility under the lease. The lawsuit, in addition to
attempting to recover the amounts expended by us for structural repairs is also
attempting to recover the rent paid by the limited partnership while the repairs
were occurring. The claim also includes a request by the limited partnership for
the court to determine if the limited partnership has the exclusive right to the
use of the pylon sign in front of the business premises. The landlord filed its
answer to the complaint denying liability for structural repairs to the business
premises, denying any obligation to reimburse the limited partnership for any
rent paid while structural repairs occurred and denying the limited
partnership's right to use the pylon sign. The lawsuit is in the discovery
stage, but is scheduled for trial during the fourth quarter of our fiscal year
2009.
(10) SUBSEQUENT EVENTS:
Subsequent events have been evaluated through August 11, 2009, the date these
financial statements were issued. No events required disclosure.
(11) BUSINESS SEGMENTS:
We operate principally in two reportable segments - package stores and
restaurants. The operation of package stores consists of retail liquor sales and
related items. Information concerning the revenues and operating income for the
thirteen weeks and thirty nine weeks ended June 27, 2009 and June 28, 2008, and
identifiable assets for the two reportable segments in which we operate, are
shown in the following table. Operating income is total revenue less cost of
merchandise sold and operating expenses relative to each segment. In computing
operating income, none of the following items have been included: interest
expense, other non-operating income and expenses and income taxes. Identifiable
assets by segment are those assets that are used in our operations in each
segment. Corporate assets are principally cash, note receivable and real
property, leasehold improvements, furniture, equipment and vehicles used at our
corporate headquarters. We do not have any operations outside of the United
States and transactions between restaurants and package liquor stores are not
material.
Thirteen Weeks Thirteen Weeks
Ending Ending
June 27, 2009 June 28, 2008
------------- -------------
Operating Revenues:
Restaurants $ 13,189 $ 12,528
Package stores 2,925 2,842
Other revenues 377 395
--------- ---------
Total operating revenues $ 16,491 $ 15,765
========= =========
Operating Income Reconciled to Income Before Income Taxes and
Minority Interests in Earnings of Consolidated Limited
Partnerships
Restaurants $ 958 $ 1,076
Package stores 82 77
--------- ---------
1,040 1,153
Corporate expenses, net of other
Revenues (390) (502)
--------- ---------
Operating income 650 651
Other income (expense) (90) (83)
--------- ---------
Income Before Income Taxes and Minority Interests in
Earnings of Consolidated Limited Partnerships $ 560 $ 568
========= =========
Depreciation and Amortization:
Restaurants $ 465 $ 427
Package stores 56 57
--------- ---------
521 484
Corporate 82 67
--------- ---------
Total Depreciation and Amortization $ 603 $ 551
========= =========
Capital Expenditures:
Restaurants $ 313 $ 878
Package stores 75 19
--------- ---------
388 897
Corporate 56 115
--------- ---------
Total Capital Expenditures $ 444 $ 1,012
========= =========
12
Thirty Nine Weeks Thirty Nine Weeks
Ending Ending
June 27, 2009 June 28, 2008
------------- -------------
Operating Revenues:
Restaurants $ 39,628 $ 37,831
Package stores 9,788 9,673
Other revenues 1,085 1,148
-------- --------
Total operating revenues $ 50,501 $ 48,652
======== ========
Operating Income Reconciled to Income Before Income
Taxes and Minority Interests in Earnings of Consolidated
Limited Partnerships
Restaurants $ 2,890 $ 3,058
Package stores 446 418
-------- --------
3,336 3,476
Corporate expenses, net of other
Revenues (1,183) (1,675)
-------- --------
Operating income 2,153 1,801
Other income (expense) (132) (287)
-------- --------
Income Before Income Taxes and Minority Interests in
Earnings of Consolidated Limited Partnerships $ 2,021 $ 1,514
======== ========
Depreciation and Amortization:
Restaurants $ 1,421 $ 1,288
Package stores 194 189
-------- --------
1,615 1,477
Corporate 252 215
-------- --------
Total Depreciation and Amortization $ 1,867 $ 1,692
======== ========
Capital Expenditures:
Restaurants $ 1,007 $ 2,536
Package stores 247 155
-------- --------
1,254 2,691
Corporate 284 278
-------- --------
Total Capital Expenditures $ 1,538 $ 2,969
======== ========
June 27, September 27,
2009 2008
---- ----
Identifiable Assets:
Restaurants $ 19,961 $ 19,866
Package store 3,639 3,709
-------- --------
23,600 23,575
Corporate 10,603 9,229
-------- --------
Consolidated Totals $ 34,203 $ 32,804
======== ========
13
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
Reported financial results may not be indicative of the financial results of
future periods. All non-historical information contained in the following
discussion constitutes forward-looking statements within the meaning of Section
27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act
of 1934. Words such as "anticipates, appears, expects, trends, intends, hopes,
plans, believes, seeks, estimates, may, will," and variations of these words or
similar expressions are intended to identify forward-looking statements. These
statements are not guarantees of future performance and involve a number of
risks and uncertainties, including but not limited to customer demand and
competitive conditions. Factors that could cause actual results to differ
materially are included in, but not limited to, those identified in the
"Management's Discussion and Analysis of Financial Condition and Results of
Operations," in the Annual Report on Form 10-K for the Company's fiscal year
ended September 27, 2008 and in this Quarterly Report on Form 10-Q. The Company
undertakes no obligation to publicly release the results of any revisions to
these forward-looking statements that may reflect events or circumstances after
the date of this report.
OVERVIEW
At June 27, 2009, we (i) operated 23 units, (excluding the adult entertainment
club referenced in (ii) below), consisting of restaurants, package stores and
combination restaurants/package stores that we either own or have operational
control over and partial ownership in; (ii) own but do not operate one adult
entertainment club; and (iii) franchise an additional six units, consisting of
two restaurants, (one of which we operate) and four combination
restaurant/package stores. The table below provides information concerning the
type (i.e. restaurant, package store or combination restaurant/package liquor
store) and ownership of the units (i.e. whether (i) we own 100% of the unit;
(ii) the unit is owned by a limited partnership of which we are the sole general
partner and/or have invested in; or (iii) the unit is franchised by us), as of
June 27, 2009 and as compared to June 28, 2008 and September 27, 2008. With the
exception of "The Whale's Rib", a restaurant we operate but do not own, all of
the restaurants operate under our service mark "Flanigan's Seafood Bar and
Grill" and all of the package liquor stores operate under our service mark "Big
Daddy's Liquors".
14
Types of Units June 27, 2009 September 27, 2008 June 28, 2008
-------------- ------------- ------------------ -------------
Company Owned:
Combination package and restaurant 4 4 4
Restaurant only 3 3 3
Package store only 5 5 5
Company Operated Restaurants Only:
Limited Partnerships 9 9 8 (1)
Franchise 1 1 1
Unrelated Third Party 1 1 1
Company Owned Club: 1 1 1
Total Company Owned/Operated Units 24 24 23
Franchised Units 6 6 6 (2)
Notes:
(1) Includes a restaurant located in Davie, Florida which is owned by a limited
partnership in which we are the sole general partner and own 48% of the limited
partnership interest and commenced operating on July 28, 2008.
(2) We operate a restaurant for one (1) franchisee. This unit is included in the
table both as a franchised restaurant, as well as a restaurant operated by the
Company.
Franchise Financial Arrangement: In exchange for our providing management and
related services to our franchisees and granting them the right to use our
service marks "Flanigan's Seafood Bar and Grill" and "Big Daddy's Liquors", our
franchisees (five of which are franchised to members of the family of our
Chairman of the Board, officers and/or directors), are required to (i) pay to us
a royalty equal to 1% of gross package sales and 3% of gross restaurant sales;
and (ii) make advertising expenditures equal to between 1.5% to 3% of all gross
sales based upon our actual advertising costs allocated between stores,
pro-rata, based upon gross sales.
Limited Partnership Financial Arrangement: We manage and control the operations
of all restaurants owned by limited partnerships, except the Fort Lauderdale,
Florida restaurant which is owned by a related franchisee. Accordingly, the
results of operations of all limited partnership owned restaurants, except the
Fort Lauderdale, Florida restaurant are consolidated into our operations for
accounting purposes. The results of operations of the Fort Lauderdale, Florida
restaurant are accounted for by us utilizing the equity method. In general,
until the investors' cash investment in a limited partnership (including any
cash invested by us and our affiliates) is returned in full, the limited
partnership distributes to the investors annually out of available cash from the
operation of the restaurant up to 25% of the cash invested in the
15
limited partnership, with no management fee paid to us. Any available cash in
excess of the 25% of the cash invested in the limited partnership distributed to
the investors annually, is paid one-half (1/2) to us as a management fee, with
the balance distributed to the investors. Once the investors in the limited
partnership have received, in full, amounts equal to their cash invested, an
annual management fee is payable to us equal to one-half (1/2) of cash available
to the limited partnership, with the other one half (1/2) of available cash
distributed to the investors (including us and our affiliates). As of June 27,
2009, limited partnerships owning three (3) restaurants have returned all cash
invested and we receive an annual management fee equal to one-half (1/2) of the
cash available for distribution by the limited partnership. In addition to its
receipt of distributable amounts from the limited partnerships, we receive a fee
equal to 3% of gross sales for use of the service mark "Flanigan's Seafood Bar
and Grill".
RESULTS OF OPERATIONS
-----------------------Thirteen Weeks Ended-------------------
June 27, 2009 June 28, 2008
------------- -------------
Amount Amount
------ ------
(In thousands) Percent (In thousands) Percent
-------------- ------- -------------- -------
Restaurant food sales $ 10,653 66.11 $ 10,182 66.25
Restaurant bar sales 2,536 15.74 2,346 15.26
Package store sales 2,925 18.15 2,842 18.49
--------- --------- --------- ---------
Total Sales $ 16,114 100.00 $ 15,370 100.00
Franchise related revenues 298 273
Owner's fee 40 68
Other operating income 39 54
--------- ---------
Total Revenue $ 16,491 $ 15,765
========= =========
---------------------Thirty-Nine Weeks Ended------------------
June 27, 2009 June 28, 2008
------------- -------------
Amount Amount
------ ------
(In thousands) Percent (In thousands) Percent
-------------- ------- -------------- -------
Restaurant food sales $ 32,020 64.80 $ 30,714 64.66
Restaurant bar sales 7,608 15.40 7,117 14.98
Package store sales 9,788 19.80 9,673 20.36
--------- --------- --------- ---------
Total Sales $ 49,416 100.00 $ 47,504 100.00
Franchise related revenues 842 815
Owner's fee 129 183
Other operating income 114 150
--------- ---------
Total Revenue $ 50,501 $ 48,652
========= =========
16
Comparison of Thirteen Weeks Ended June 27, 2009 and June 28, 2008.
Revenues. Total revenue for the thirteen weeks ended June 27, 2009 increased
$726,000 or 4.61% to $16,491,000 from $15,765,000 for the thirteen weeks ended
June 28, 2008. This increase resulted from sales from the Davie, Florida limited
partnership restaurant ($952,000), which opened for business on July 28, 2008,
and the increase in same store package liquor sales ($83,000), offset by
declines in same store restaurant food and bar sales ($291,000). Without giving
effect to the revenue generated from the Davie, Florida restaurant ($952,000),
total revenue for the thirteen weeks ended June 27, 2009 would have decreased
$226,000 or 1.43% to $15,539,000 from $15,765,000 for the thirteen weeks ended
June 28, 2008.
Restaurant Food Sales. Restaurant revenue generated from the sale of food
at restaurants totaled $10,653,000 for the thirteen weeks ended June 27, 2009 as
compared to $10,182,000 for the thirteen weeks ended June 28, 2008. The increase
in restaurant food sales resulted from sales from the Davie, Florida restaurant,
which generated $780,000 of revenue from the sale of food during the thirteen
weeks ended June 27, 2009. Without giving effect to the revenue generated from
the Davie, Florida restaurant ($780,000) from the sale of food for the thirteen
weeks ended June 27, 2009, restaurant revenue generated from the sale of food
during the thirteen weeks ended June 27, 2009, would have decreased $309,000 or
3.03% to $9,873,000 from $10,182,000 for the thirteen weeks ended June 28, 2008.
Comparable weekly restaurant food sales (for restaurants open for all of the
third quarter of our fiscal year 2009 and the third quarter of our fiscal year
2008, which consists of seven restaurants owned by us and eight restaurants
owned by affiliated limited partnerships) was $759,000 and $783,000 for the
thirteen weeks ended June 27, 2009 and June 28, 2008, respectively, a decrease
of 3.07%. We attribute this decline primarily to the current domestic and global
economic downturn. Comparable weekly restaurant food sales for Company owned
restaurants only was $310,000 and $330,000 for the third quarter of our fiscal
year 2009 and the third quarter of our fiscal year 2008, respectively, a
decrease of 6.06%. Comparable weekly restaurant food sales for affiliated
limited partnership owned restaurants only was $449,000 and $453,000 for the
third quarter of our fiscal year 2009 and the third quarter of our fiscal year
2008, respectively, a decrease of 0.88%. We anticipate that restaurant food
sales will decrease throughout the balance of our fiscal year 2009 due to a
decline in same store restaurant food sales, offset by the operation of the
Davie, Florida restaurant for the entire fourth quarter of our fiscal year 2009.
Restaurant Bar Sales. Restaurant revenue generated from the sale of
alcoholic beverages at restaurants (bar sales) totaled $2,536,000 for the
thirteen weeks ended June 27, 2009 as compared to $2,346,000 for the thirteen
weeks ended June 28, 2008. The increase in restaurant bar sales is due to sales
from the Davie, Florida restaurant, which generated $171,000 of revenue from bar
sales during the thirteen weeks ended June 27, 2009. Without giving effect to
the revenue from bar sales generated from the Davie, Florida restaurant
($171,000) for the thirteen weeks ended June 27, 2009, restaurant revenue
generated from bar sales during the thirteen weeks ended June 27, 2009, would
have increased $19,000 or 0.81% to $2,365,000 from $2,346,000 for the thirteen
weeks ended June 28, 2008. Comparable weekly restaurant bar sales (for
restaurants open for all of the third quarter of our fiscal year 2009 and the
third quarter of our fiscal year 2008, which consists of seven restaurants owned
by us and eight restaurants owned by affiliated limited partnerships) was
$182,000 for the thirteen weeks ended June 27, 2009 and $180,000 for the
thirteen weeks ended June 28, 2008, an increase of 1.11%. Comparable weekly
restaurant bar sales for Company owned restaurants only was $75,000 and $74,000
for the third quarter of our fiscal year 2009 and the third quarter of our
fiscal year 2008, respectively, an increase of 1.35%. Comparable weekly
restaurant bar sales for affiliated limited partnership owned restaurants only
was $107,000 and $106,000 for the third quarter of our fiscal year 2009 and the
third quarter of our fiscal year 2008, respectively, an increase of 0.94%. We
anticipate that restaurant bar sales will continue to increase throughout the
balance of our fiscal year 2009 due to, primarily, the operation of the Davie,
Florida restaurant for the entire fourth quarter of our fiscal year 2009.
Package Store Sales. Revenue generated from sales of liquor and related
items at package liquor stores totaled $2,925,000 for the thirteen weeks ended
June 27, 2009 as compared to $2,842,000 for the thirteen weeks ended June 28,
2008, an increase of $83,000 or 2.92%. The weekly average of same store
17
package liquor store sales, which includes all nine (9) Company owned package
liquor stores, was $225,000 for the thirteen weeks ended June 27, 2009 as
compared to $219,000 for the thirteen weeks ended June 28, 2008, respectively.
The increase was primarily due to increased advertising and promotions during
the thirteen weeks ended June 27, 2009. Package liquor store sales are expected
to remain constant throughout the balance of our fiscal year 2009.
Operating Costs and Expenses. Operating costs and expenses, (consisting of cost
of merchandise sold, payroll and related costs, occupancy costs and selling,
general and administrative expenses), for the thirteen weeks ended June 27, 2009
increased $727,000 or 4.81% to $15,841,000 from $15,114,000 for the thirteen
weeks ended June 28, 2008. The increase was primarily due to expenses related to
the operation of the Davie, Florida restaurant and to a lesser extent a general
increase in food costs, offset by actions taken by management to reduce and/or
control costs and expenses. We anticipate that our operating costs and expenses
will continue to increase throughout the balance of our fiscal year 2009 due to,
primarily, the operation of the Davie, Florida restaurant and an expected
general increase in food costs. Operating costs and expenses increased as a
percentage of total sales to approximately 96.06% in the third quarter of our
fiscal year 2009 from 95.87% in the third quarter of our fiscal year 2008.
Gross Profit. Gross profit is calculated by subtracting the cost of merchandise
sold from sales.
Restaurant Food and Bar Sales. Gross profit for food and bar sales for the
thirteen weeks ended June 27, 2009 increased to $8,607,000 from $8,331,000 for
the thirteen weeks ended June 28, 2008. Our gross profit margin for restaurant
food and bar sales (calculated as gross profit reflected as a percentage of
restaurant food and bar sales), was 65.26% for the thirteen weeks ended June 27,
2009 and 66.50% for the thirteen weeks ended June 28, 2008. This decrease in
gross profit for restaurant and bar sales for the third quarter of our fiscal
year 2009, (-1.24%), resulted primarily from our direct mailing advertising,
which includes a $10.00 discount against a customer's check of $20.00 or more,
and from higher food costs. We have not increased menu prices since the first
quarter of our fiscal year 2008 to offset higher food costs.
Package Store Sales. Gross profit for package store sales for the thirteen
weeks ended June 27, 2009 increased to $957,000 from $848,000 for the thirteen
weeks ended June 28, 2008. Our gross profit margin, (calculated as gross profit
reflected as a percentage of package liquor store sales), for package liquor
store sales was 32.72% for the thirteen weeks ended June 27, 2009 and 29.84% for
the thirteen weeks ended June 28, 2008. The increase in our gross profit margin,
(2.88%), was primarily due to the purchase of "close out" and inventory
reduction merchandise from wholesalers during the thirteen weeks ended June 27,
2009. We anticipate the gross profit margin for package store sales to remain
constant throughout the balance of our fiscal year 2009 as we expect to continue
purchasing "close out" and inventory reduction merchandise from wholesalers.
Payroll and Related Costs. Payroll and related costs for the thirteen weeks
ended June 27, 2009 increased $240,000 or 5.17% to $4,885,000 from $4,645,000
for the thirteen weeks ended June 28, 2008. This increase is primarily
attributable to the Davie, Florida restaurant and the annual increase in the
Florida minimum wage, which was effective January 1, 2009, offset by a reduction
of our store level management. We anticipate that our payroll costs and related
expenses will continue to increase through our fiscal year 2009 due to,
primarily, the operation of the Davie, Florida restaurant through the balance of
our fiscal year 2009. Payroll and related costs as a percentage of total sales
was 29.62% in the third quarter of our fiscal year 2009 and 29.46% of total
sales in the third quarter of our fiscal year 2008. This increase as a
percentage of sales was primarily due to the annual increase in the Florida
minimum wage, which was effective January 1, 2009.
Occupancy Costs. Occupancy costs (consisting of rent, common area maintenance,
repairs, real property taxes and amortization of leasehold purchases) for the
thirteen weeks ended June 27, 2009 decreased
18
$1,000 or 0.10% to $988,000 from $989,000 for the thirteen weeks ended June 28,
2008. We anticipate that our occupancy costs will remain stable throughout the
balance of our fiscal year 2009 with no rental payments for additional
restaurant locations being developed by the Company.
Selling, General and Administrative Expenses. Selling, general and
administrative expenses (consisting of general corporate expenses, including but
not limited to advertising, insurance, professional costs, clerical and
administrative overhead) for the thirteen weeks ended June 27, 2009 increased
$129,000 or 3.92% to $3,418,000 from $3,289,000 for the thirteen weeks ended
June 28, 2008. Selling, general and administrative expenses as a percentage of
total sales was 20.73% in the third quarter of our fiscal year 2009, as compared
to 20.86% in the third quarter of our fiscal year 2008. We anticipate that our
selling, general and administrative expenses will increase throughout the
balance of our fiscal year 2009 due to, primarily, the operation of our Davie,
Florida restaurant, increased advertising expense and an overall increase in
expenses.
Depreciation. Depreciation for the thirteen weeks ended June 27, 2009 and June
28, 2008 was $557,000 and $457,000 respectively. As a percentage of revenue,
depreciation expense was 3.38% of revenue in the thirteen weeks ended June 27,
2009 and 2.90% of revenue in the thirteen weeks ended June 28, 2008.
Interest Expense, Net. Interest expense, net, for the thirteen weeks ended June
27, 2009 decreased $12,000 to $105,000 from $117,000 for the thirteen weeks
ended June 28, 2008. The principal balance on our line of credit was
approximately equal during the thirteen weeks ended June 27, 2009 and June 28,
2008, however the interest rate we paid during our fiscal year 2009 was lower.
Net Income. Net income for the thirteen weeks ended June 27, 2009 decreased
$25,000 or 7.44% to $311,000 from $336,000 for the thirteen weeks ended June 28,
2008. As a percentage of sales, net income for the third quarter of our fiscal
year 2009 is 1.89%, as compared to 2.13% in the third quarter of our fiscal year
2008. The decrease in net income as a percentage of sales (-0.24%) is primarily
due to lower gross profit in our restaurant division, offset by an adjustment of
$18,000 to our deferred tax assets, higher gross profit in our package liquor
store division and improved control over expenses. Without giving effect to this
adjustment of $18,000 to our deferred tax asset, we would have generated net
income of $293,000 for the thirteen weeks ended June 27, 2009, which as a
percentage of sales is 1.78%. Without giving effect to the adjustment to our
deferred tax asset for the thirteen weeks ended June 27, 2009, the decrease in
net income for the thirteen weeks ended June 27, 2009, as a percentage of sales
(-0.35%) is primarily due to lower gross profit in our restaurant division,
offset by higher gross profit in our package liquor store division and improved
control over expenses. During the third quarter of fiscal year 2008, we had
pre-opening, non-recurring expenses associated with the Davie, Florida
restaurant, ($62,000), which adversely affected net income.
Comparison of Thirty-Nine Weeks Ended June 27, 2009 and June 28, 2008.
Revenues. Total revenue for the thirty nine weeks ended June 27, 2009 increased
$1,849,000 or 3.80% to $50,501,000 from $48,652,000 for the thirty nine weeks
ended June 28, 2008. This increase resulted from sales from the Davie, Florida
limited partnership restaurant ($2,949,000), which opened for business on July
28, 2008 and increases in same store package liquor stores ($115,000), offset by
declines in same store restaurant food and bar sales ($22,000). Without giving
effect to the revenue generated from the Davie, Florida restaurant ($2,949,000),
total revenue for the thirty nine weeks ended June 27, 2009 would have decreased
$1,100,000 or 2.26% to $47,552,000 from $48,652,000 for the thirty nine weeks
ended June 28, 2008.
Restaurant Food Sales. Restaurant revenue generated from the sale of food
at restaurants totaled $32,020,000 for the thirty nine
19
weeks ended June 27, 2009 as compared to $30,714,000 for the thirty nine weeks
ended June 28, 2008, an increase of $1,306,000 or 4.25%. The increase in
restaurant food sales resulted from sales from the Davie, Florida restaurant,
which generated $2,430,000 of revenue from the sale of food during the thirty
nine weeks ended June 27, 2009. Without giving effect to the revenue generated
from the Davie, Florida restaurant ($2,430,000) from the sale of food for the
thirty nine weeks ended June 27, 2009, restaurant revenue generated from the
sale of food during the thirty nine weeks ended June 27, 2009, would have
decreased $1,124,000 or 3.66% to $29,590,000 from $30,714,000 for the thirty
nine weeks ended June 28, 2008. Comparable weekly restaurant food sales (for
restaurants open for all of the thirty nine weeks ended June 27, 2009 and the
thirty nine weeks ended June 28, 2008, which consists of seven restaurants owned
by us and seven restaurants owned by affiliated limited partnerships) was
$712,000 and $735,000 for the thirty nine weeks ended June 27, 2009 and June 28,
2008, respectively, a decrease of 3.13%. We attribute this decline primarily to
the current domestic and global economic downturn. Comparable weekly restaurant
food sales for Company owned restaurants only was $313,000 and $331,000 for the
thirty nine weeks ended June 27, 2009 and June 28, 2008, respectively, a
decrease of 5.44%. Comparable weekly restaurant food sales for affiliated
limited partnership owned restaurants only was $399,000 and $404,000 for the
thirty nine weeks ended June 27, 2009 and June 28, 2008, respectively, a
decrease of 1.24%. We anticipate that restaurant food sales will decrease
throughout the balance of our fiscal year 2009 due to a decline in same store
restaurant food sales, offset by the operation of the Davie, Florida restaurant
for the entire fourth quarter of our fiscal year 2009.
Restaurant Bar Sales. Restaurant revenue generated from the sale of alcoholic
beverages at restaurants (bar sales) totaled $7,608,000 for the thirty nine
weeks ended June 27, 2009 as compared to $7,117,000 for the thirty nine weeks
ended June 28, 2008, an increase of $491,000 or 6.90%. The increase in
restaurant bar sales is due to sales from the Davie, Florida restaurant, which
generated $516,000 of revenue from bar sales during the thirty nine weeks ended
June 27, 2009. Without giving effect to the revenue from bar sales generated
from the Davie, Florida restaurant ($516,000) for the thirty nine weeks ended
June 27, 2009, restaurant revenue generated from bar sales during the thirty
nine weeks ended June 27, 2009, would have decreased $25,000 or 0.35% to
$7,092,000 from $7,117,000 for the thirty nine weeks ended June 28, 2008.
Comparable weekly restaurant bar sales (for restaurants open for all of the
thirty nine weeks ended June 27, 2009 and the thirty nine weeks ended June 28,
2008, which consists of seven restaurants owned by us and seven restaurants
owned by affiliated limited partnerships) was $173,000 and $172,000 for the
thirty nine weeks ended June 27, 2009 and June 28, 2008, respectively, an
increase of 0.58%. Comparable weekly restaurant bar sales for Company owned
restaurants only was $75,000 and $74,000 for the thirty-nine weeks ended June
27, 2009 and the thirty-nine weeks ended June 28, 2008, respectively, an
increase of 1.35%. Comparable weekly restaurant bar sales for affiliated limited
partnership owned restaurants only was unchanged at $98,000 for the thirty-nine
weeks ended June 27, 2009 and the thirty-nine weeks ended June 28, 2008. We
anticipate that restaurant bar sales will continue to increase throughout the
balance of our fiscal year 2009 due to, primarily, the operation of the Davie,
Florida restaurant for the entire fourth quarter of our fiscal year 2009.
Package Store Sales. Revenue generated from sales of liquor and related
items at package stores totaled $9,788,000 for the thirty nine weeks ended June
27, 2009 as compared to $9,673,000 for the thirty nine weeks ended June 28,
2008, an increase of 1.19%. The weekly average of same store package store sales
was $251,000 and $248,000 for the thirty nine weeks ended June 27, 2009 and June
28, 2008, respectively. The increase was primarily due to increased advertising
and promotions. Package store sales are expected to remain constant through the
balance of our fiscal year 2009.
Operating Costs and Expenses. Operating costs and expenses, (consisting of cost
of merchandise sold, payroll and related costs, occupancy costs and selling,
general and administrative expenses), for the thirty nine weeks ended June 27,
2009 increased $1,497,000 or 3.20% to $48,348,000 from $46,851,000 for the
20
thirty nine weeks ended June 28, 2008. The increase was primarily due to
expenses related to the operation of the Davie, Florida restaurant and to a
lesser extent a general increase in food costs. We anticipate that our operating
costs and expenses will continue to increase throughout the balance of our
fiscal year 2009 due to, primarily, the operation of the Davie, Florida
restaurant and an expected general increase in food costs. Operating costs and
expenses decreased as a percentage of total sales to 95.74% for the thirty nine
weeks ended June 27, 2009 from 96.30% for the thirty nine weeks ended June 28,
2008.
Gross Profit. Gross profit is calculated by subtracting the cost of merchandise
sold from sales.
Restaurant Food and Bar Sales. Gross profit for food and bar sales for the
thirty nine weeks ended June 27, 2009 increased to $26,158,000 from $25,161,000
for the thirty nine weeks ended June 28, 2008. Our gross profit margin for
restaurant food and bar sales (calculated as gross profit reflected as a
percentage of restaurant food and bar sales), was 66.01% for the thirty nine
weeks ended June 27, 2009 and 66.51% for the thirty nine weeks ended June 28,
2008. This decrease in gross profit for restaurant and bar sales for the thirty
nine weeks ended June 27, 2009, (-0.50%), resulted primarily from our direct
mailing advertising, which includes a $10.00 discount against a customer's check
of $20.00 or more, and from higher food costs. We have not increased menu prices
since the first quarter of our fiscal year 2008 to offset higher food costs.
Package Store Sales. Gross profit for package store sales for the thirty
nine weeks ended June 27, 2009 increased to $3,048,000 from $2,818,000 for the
thirty nine weeks ended June 28, 2008. Our gross profit margin, (calculated as
gross profit reflected as a percentage of package store sales), was 31.14% for
the thirty nine weeks ended June 27, 2009 compared to 29.13% for the thirty nine
weeks ended June 28, 2008. The increase in our gross profit margin, (2.01%), was
primarily due to our purchase of "close out" and inventory reduction merchandise
from wholesalers during the thirty nine weeks ended June 27, 2009. We anticipate
the gross profit margin for package store sales to remain constant throughout
the balance of our fiscal year 2009 as we expect to continue purchasing "close
out" and inventory reduction merchandise from wholesalers.
Payroll and Related Costs. Payroll and related costs for the thirty nine weeks
ended June 27, 2009 increased $337,000 or 2.35% to $14,700,000 from $14,363,000
for the thirty nine weeks ended June 28, 2008. This increase is primarily
attributable to the Davie, Florida restaurant and the annual increase in the
Florida minimum wage, which was effective January 1, 2009, offset by a reduction
of our store level management. Payroll and related costs as a percentage of
total sales was 29.11% for the thirty nine weeks ended June 27, 2009 and 29.52%
of total sales for the thirty nine weeks ended June 28, 2008. We anticipate that
our payroll costs and related expenses will continue to increase through our
fiscal year 2009 due to, primarily, the operation of the Davie, Florida
restaurant through the balance of our fiscal year 2009 and the annual increase
in the Florida minimum wage, which was effective January 1, 2009, partially
offset by a reduction of our store level management.
Occupancy Costs. Occupancy costs (consisting of rent, common area maintenance,
repairs, real property taxes and amortization of leasehold purchases) for the
thirty nine weeks ended June 27, 2009 decreased $7,000 or 0.24% to $2,962,000
from $2,969,000 for the thirty nine weeks ended June 28, 2008. We anticipate
that our occupancy costs will continue to be stable throughout the balance of
our fiscal year 2009 with no rental payments for additional restaurant locations
being developed by the Company.
Selling, General and Administrative Expenses. Selling, general and
administrative expenses (consisting of general corporate expenses, including but
not limited to advertising, insurance, professional costs, clerical and
administrative overhead) for the thirty nine weeks ended June 27, 2009 increased
$482,000 or 4.82% to $10,476,000 from $9,994,000 for the thirty nine weeks ended
June 28, 2008. This increase is due primarily to the operation of the Davie,
Florida restaurant and an overall increase in expenses.
21
Selling, general and administrative expenses increased as a percentage of total
sales for the thirty nine weeks ended June 27, 2009 to 20.74% as compared to
20.54% for the thirty nine weeks ended June 28, 2008. We anticipate that our
selling, general and administrative expenses will continue to increase
throughout the balance of our fiscal year 2009 due to, primarily, the operation
of our Davie, Florida restaurant and an overall increase in expenses.
Depreciation. Depreciation for the thirty-nine weeks ended June 27, 2009 and
June 28, 2008 was $1,708,000 and $1,518,000 respectively. As a percentage of
revenue, depreciation expense was 3.38% of revenue in the thirty-nine weeks
ended June 27, 2009 and 3.12% of revenue in the thirty-nine weeks ended June 28,
2008.
Interest Expense, Net. Interest expense, net, for the thirty-nine weeks ended
June 27, 2009 decreased $26,000 to $332,000 from $358,000 for the thirty-nine
weeks ended June 28, 2008. The principal balance on our line of credit was
approximately equal during the thirty nine weeks ended June 27, 2009 and June
28, 2008; however the interest rate we paid during our fiscal year 2009 was
lower.
Net Income. Net income for the thirty nine weeks ended June 27, 2009 increased
$176,000 or 17.76% to $1,167,000 from $991,000 for the thirty nine weeks ended
June 28, 2008. As a percentage of sales, net income for the thirty nine weeks
ended June 27, 2009 is 2.31%, as compared to 2.04% for the thirty nine weeks
ended June 28, 2008. During the thirty nine weeks ended June 27, 2009, we
recognized interest income of $124,000 paid on claims we filed in the
liquidation proceedings of Ambassador Insurance Company in 1983 and other income
of $26,000 paid as the balance of our claims (10%) filed in the liquidation
proceedings of Ambassador Insurance Company. We also adjusted our tax deferred
asset by $140,000. Without giving effect to this interest income of $124,000,
other income of $26,000 and the adjustment to our deferred tax asset of
$140,000, we would have generated net income of $877,000 for the thirty nine
weeks ended June 27, 2009, which as a percentage of sales is 1.74%. Without
giving effect to the interest income and other income and the adjustment to our
deferred tax asset for the thirty nine weeks ended June 27, 2009, the decrease
in net income for the thirty nine weeks ended June 27, 2009, as a percentage of
sales (-0.30%) is primarily due to a decline in same store restaurant sales and
a general increase in overall expenses. The net income for the thirty nine weeks
ended June 28, 2008 was adversely affected by our share of the non-recurring
pre-opening and opening expenses associated with the limited partnership owned
restaurant in Pembroke Pines, Florida, ($40,000), and our share of the
non-recurring pre-opening expenses associated with the limited partnership owned
restaurant in Davie, Florida, ($74,000), higher food costs and overall expenses,
including electric, gas and real property taxes.
New Limited Partnership Restaurants
As new restaurants open, our income from operations will be adversely affected
due to our obligation to fund pre-opening costs, including but not limited to
pre-opening rent for the new locations. During the thirty nine weeks ended June
27, 2009, we did not have a new restaurant location in the development stage and
did not recognize any pre-opening costs. During the thirty nine weeks ended June
28, 2008, we recognized non-cash pre-opening rent in the approximate amount of
$6,000 and recognized cash pre-opening rent in the approximate amount of $12,000
for the Pembroke Pines, Florida restaurant. During the thirty nine weeks ended
June 28, 2008, we also paid and expensed pre-opening rent in the approximate
amount of $100,000 for the Davie, Florida restaurant, which is the full rent
provided in the 15 year lease. We are recognizing rent expense on a straight
line basis over the term of the lease.
During the thirty nine weeks ended June 28, 2008, the limited partnership
restaurant in Davie, Florida reported losses of $400,000 primarily due to
pre-opening costs, thus contributing to a reduction in the operating income for
the thirty nine weeks ended June 28, 2008. This restaurant opened for business
on July 28, 2008.
22
Until we fund a new unit, our income from operations will not be adversely
affected by pre-opening costs. Throughout the balance of fiscal year 2009, we do
not expect our income from operations to be materially adversely affected by
pre-opening costs for new locations.
Trends
During the next twelve months, we expect aggregate restaurant sales to decrease
as compared to prior periods and same store restaurant food and bar sales to
decline due primarily to the current domestic and global economic downturn. We
expect higher food costs and higher overall expenses, which will adversely
affect our net income. During the first quarter of our fiscal year 2008, we
raised menu prices to offset higher food costs and overall expenses. We plan to
limit menu price increases as long as possible while maintaining our high
quality of food and service and without reducing our food portions. We have
increased our advertising to attract customers, but plan to emphasize our direct
mailings and limit and/or even eliminate our monthly full page newspaper ads and
our radio advertising. Notwithstanding our increased promotional activity, we
believe we will experience reduced revenues, reduced gross profit and increased
costs in some or all of our locations and as a result our net income will be
adversely affected. To mitigate this, we may raise menu prices whenever
necessary and wherever competitively possible.
We continue to search for new locations to open restaurants and thereby expand
our business, but we are currently looking for locations that will not require
an extensive and costly renovation. Any new locations will likely be opened
using our limited partnership ownership model.
We are not actively searching for locations for the operation of new package
liquor stores, but if an appropriate location for a package liquor store becomes
available, we will consider it.
Liquidity and Capital Resources
We fund our operations through cash from operations and borrowings under our
line of credit. As of June 27, 2009, we had cash of approximately $4,945,000, an
increase of $1,701,000 from our cash balance of $3,244,000 as of September 27,
2008. The increase in cash as of June 27, 2009 was primarily from our operations
due to minimal demand upon our cash flow for extraordinary items. Management
believes that the Company's current cash availability from its line of credit
and expected cash from operations will be sufficient to fund operations and
capital expenditures for at least the next twelve months.
Cash Flows
The following table is a summary of our cash flows for the thirty-nine weeks of
fiscal years 2009 and 2008.
23
-----Thirty-Nine Weeks Ended----
June 27, 2009 June 28, 2008
(in Thousands)
Net cash provided by operating activities $ 4,680 $ 2,506
Net cash used in investing activities (1,237) (2,823)
Net cash provided by (used in)
financing activities (1,742) 1,558
--------- ---------
Net Increase in Cash and Cash Equivalents 1,701 1,241
Cash and Cash Equivalents, Beginning 3,244 2,223
--------- ---------
Cash and Cash Equivalents, Ending $ 4,945 $ 3,464
========= =========
We have determined that we must retain any earnings for the development and
operation of our business and accordingly, we do not intend to pay any cash
dividends in the foreseeable future.
Capital Expenditures
In addition to using cash for our operating expenses, we use cash to fund the
development and construction of new restaurants and secondarily to fund
capitalized property improvement for our existing restaurants. We acquired
property and equipment of $1,538,000, (including $292,000 of deposits recorded
in other assets as of September 27, 2008), during the thirty nine weeks ended
June 27, 2009, including $690,000 for renovations to two (2) existing Company
owned restaurants, as compared to $2,942,000, (of which $26,000 was financed),
during the thirty nine weeks ended June 28, 2008, which included $268,000 for
renovations to one (1) existing Company owned restaurant. During the thirty nine
weeks ended June 28, 2008, the limited partnership which owns the Davie, Florida
restaurant completed its private offering, raising the sum of $3,875,000, of
which $1,850,000 represents our investment. We did not advance any funds to this
limited partnership in excess of our investment. The funds from the private
offering were used to complete the renovations to the business premises for
operation of a "Flanigan's Seafood Bar and Grill" restaurant and provided
working capital.
All of our owned units require periodic refurbishing in order to remain
competitive. We anticipate the cost of this refurbishment in our fiscal year
2009 to be approximately $700,000, of which $690,000 has been spent through June
27, 2009.
Long Term Debt
As of June 27, 2009, we had long term debt of $7,063,000, which includes the
balance on our line of credit, as compared to $6,558,000 as of June 28, 2008,
and $6,745,000 as of September 27, 2008.
During the thirty nine weeks ended June 27, 2009, we changed our primary banking
relationship to another unaffiliated financial institution, which includes a new
line of credit of $2,500,000. The outstanding balance on our line of credit
bears interest at BBA LIBOR 1 month rate, plus 2.25%, (2.567% as June 27, 2009),
with monthly payments of interest only and the unpaid principal balance and all
accrued interest due in full on October 7, 2009. We granted our lender a
security interest in substantially all of our assets and a second mortgage on
our corporate offices as collateral to secure our repayment obligations under
our credit line. As of June 27, 2009, the amount outstanding under our secured
line of credit was $1,586,000.
Financed Insurance Premiums
(i) For the policy year beginning December 30, 2008, our property insurance is a
two (2) year policy with our insurance carrier. The two (2) year property
insurance premium is in the amount of $631,000 and is financed in full through
an unrelated third party lender. The finance agreement earns interest at the
rate of 5.15% per annum and is amortized over 20 months, with monthly payments
of principal and interest, each in the amount of $30,000. The finance agreement
is secured by a security interest in all insurance policies, all unearned
premium, return premium, dividend payments and loss payments thereof.
(ii) For the policy year beginning December 30, 2008, our general liability
insurance, excluding limited partnerships, is a one (1) year policy with our
insurance carriers, including automobile and excess liability coverage. The one
(1) year general liability insurance premiums, including automobile and excess
liability coverage, is in the aggregate amount of $249,000 and is financed in
full through the same unrelated third party lender. The finance agreement earns
interest at the rate of 4.15% per annum and is amortized over 10 months, with
monthly payments of principal and interest, each in the amount of $23,000. The
finance agreement is secured by a security interest in all insurance policies,
all unearned premium, return premium, dividend payments and loss payments
thereof.
24
(iii) For the policy year beginning December 30, 2008, our general liability
insurance for our limited partnerships is a one (1) year policy with our
insurance carriers, including excess liability coverage. The one (1) year
general liability insurance premiums, including excess liability coverage, is in
the aggregate amount of $214,000 and is financed in full through the same
unrelated third party lender. The finance agreement earns interest at the rate
of 4.05% per annum and is amortized over 10 months, with monthly payments of
principal and interest, each in the amount of $19,000. The finance agreement is
secured by a security interest in all insurance policies, all unearned premium,
return premium, dividend payments and loss payments thereof.
As of June 27, 2009, the aggregate principal balance from the financing of our
property and general liability insurance policies is $661,000.
Purchase Commitments
In order to fix the cost and ensure adequate supply of baby back ribs for our
restaurants, on November 26, 2008, we entered into a purchase agreement with our
rib supplier, whereby we agreed to purchase approximately $3,800,000 of baby
back ribs during calendar year 2009 from this vendor at a fixed cost. While we
anticipate purchasing all of our rib supply from this vendor, we believe there
are several other alternative vendors available, if needed.
Working Capital
The table below summarizes the current assets, current liabilities, and working
capital for our fiscal quarters ended June 27, 2009, June 28, 2008 and our
fiscal year ended September 27, 2008.
Item June 27, 2009 June 28, 2008 Sept 27, 2008
---- ------------- ------------- -------------
(in Thousands)
Current Assets $ 8,918 $ 7,002 $ 7,083
Current Liabilities 7,001 4,080 4,735
------- ------- -------
Working Capital $ 1,917 $ 2,922 $ 2,348
Our working capital as of June 27, 2009 decreased by 34.39% from the working
capital for the fiscal quarter ending June 28, 2008 and decreased by 18.36% from
our working capital for our fiscal year ending September 27, 2008. Our working
capital decreased during our fiscal quarter ending June 27, 2009 from our
working capital for our fiscal year ending September 27, 2008 due to the
re-classification of our line of credit, which matures on October 7, 2009, as a
current liability. Our prior lender consistently extended the maturity date on
our line of credit on a quarterly basis and accordingly, our obligations under
our prior line of credit were not recorded as a current liability.
While there can be no assurance due to, among other things, unanticipated
expenses or unanticipated decline in revenues, or both, we believe that positive
cash flow from operations will adequately fund operations, debt reductions and
planned capital expenditures throughout the balance of our fiscal year 2009. We
also anticipate that throughout the balance of our fiscal year 2009, working
capital may be affected by the payment of the purchase of a surveillance camera
system ($118,000) and our line of credit in the event the line of credit is not
renewed.
Off-Balance Sheet Arrangements
The Company does not have off-balance sheet arrangements.
Inflation
The primary inflationary factors affecting our operations are food, beverage and
labor costs. A large number of restaurant personnel are paid at rates based upon
applicable minimum wage and increases in minimum wage directly affect labor
costs. To date, inflation has not had a material impact on our operating
results, but this circumstance may change in the future if food and fuel costs
continue to rise.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
We do not ordinarily hold market risk sensitive instruments for trading purposes
and as of June 27, 2009 held no equity securities.
25
Interest Rate Risk
At June 27, 2009, of the Company's debt arrangements, only borrowings under our
line of credit bear interest at BBA LIBOR 1 month rate, plus 2.25%. Increases in
interest rates may have a material affect upon results of operations, depending
upon the outstanding principal balance on our line of credit from time to time.
At June 27, 2009, our cash resources earn interest at variable rates.
Accordingly, our return on these funds is affected by fluctuations in interest
rates.
ITEM 4T. CONTROLS AND PROCEDURES
Disclosure Controls and Procedures
Based on evaluations as of the end of the period covered by this report, our
Chief Executive Officer and Chief Financial Officer, with the participation of
our management team, have concluded that our disclosure controls and procedures
(as defined in Rules 13a-15(e) and 15d-15(e) to the Securities Exchange Act of
1934, as amended (the "Exchange Act")) were effective.
Limitations on the Effectiveness of Controls and Permitted Omission from
Management's Assessment
Our internal control over financial reporting is designed to provide reasonable
assurance regarding the reliability of financial reporting and the preparation
of financial statements for external purposes in accordance with generally
accepted accounting principles. All internal control systems, no matter how well
designed, have inherent limitations, including the possibility of human error
and the circumvention or overriding of controls. Accordingly, even effective
internal controls can only provide reasonable assurance with respect to
financial statement preparation. Also, projections of any evaluation of
effectiveness to future periods are subject to the risk that controls may become
inadequate because of changes in conditions, or that the degree of compliance
with the policies or procedures may deteriorate.
Changes in Internal Control Over Financial Reporting
During the period covered by this report, we have not made any change to our
internal control over financial reporting that has materially affected, or is
reasonably likely to materially affect, our internal control over financial
reporting.
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
See "Litigation" on page 11 of this Report and Item 1 and Item 3 to Part 1 of
the Annual Report on Form 10-K for the fiscal year ended September 27, 2008 for
a discussion of other legal proceedings resolved in prior years.
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
Purchase of Company Common Stock
26
Pursuant to a discretionary plan approved by the Board of Directors at its
meeting on May 17, 2007, during the thirteen weeks ended June 27, 2009, we
purchased 325 shares of our common stock for an aggregate purchase price of
$2,000 from an employee. During the thirteen weeks ended June 28, 2008, we
purchased 2,700 shares of our common stock for an aggregate purchase price of
$22,000. Of the shares purchased, we purchased 2,500 shares of our common stock
from an employee for $20,000 and 200 shares of our common stock on the open
market for an aggregate purchase price of $2,000.
ISSUER PURCHASES OF EQUITY SECURITIES
(c) Total Number of (d) Maximum Number (or
Shares (or Units) Approximate Dollar Value) of
(a) Total Number of (b) Average Purchased as Part of Shares (or Units) that May
Shares (or Units) Price Paid per Publicly Announced Plans Yet Be Purchased Under the
Period Purchased Share (or Unit) or Programs Plans or Programs
March 29, 2009 - May 1, 2009 -- -- -- 70,025
May 2, 2009 - May 30, 2009 -- -- -- 70,025
May 31, 2009 - June 27, 2009 325 $5.76 1,876 69,700
Total as of June 27, 2009 325 1,876 69,700
27
ITEM 6. EXHIBITS
The following exhibits are filed with this Report:
Exhibit Description
------- -----------
31.1 Certification of Chief Executive Officer pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002.
31.2 Certification of Chief Financial Officer pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002.
32.1 Certification of Chief Executive Officer pursuant to
18 U.S.C. Section 1350, as adopted pursuant to Section
906 of the Sarbanes-Oxley Act of 2002.
32.2 Certification of Chief Financial Officer pursuant to
18 U.S.C. Section 1350, as adopted pursuant to Section
906 of the Sarbanes-Oxley Act of 2002.
28
SIGNATURES
In accordance with the requirements of the Securities Exchange Act of
1934, the registrant caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
FLANIGAN'S ENTERPRISES, INC.
Date: August 11, 2009 /s/ James G. Flanigan
----------------------------------------------
JAMES G. FLANIGAN, Chief Executive Officer
and President
/s/ Jeffrey D. Kastner
----------------------------------------------
JEFFREY D. KASTNER, Chief Financial Officer
and Secretary
(Principal Financial and Accounting Officer)
29