Romacorp, Inc. Announces Third Quarter Results


DALLAS, Feb. 3, 2003 (PRIMEZONE) -- Romacorp, Inc. today announced results for its third quarter ended December 22, 2002.

Revenue for the quarter decreased $2.1 million, or 7.2% to $27.1 million as compared with the same quarter of the prior year. On a year-to-date basis, revenues decreased $8.9 million, or 9.5%, to $85.4 million as compared with the same period of the prior year. Of this decrease, the closure of five restaurants during the prior fiscal year and one restaurant during the current quarter resulted in a sales decrease of $1.4 million for the quarter and $4.9 million for the year-to-date period. The remaining decrease is due to sales declines at comparable restaurants of 1.7% for the quarter and 4.7% for the year to date.

During the third quarter, franchisees opened two restaurants in Canada and restaurants in Leon, Mexico; Guayaquil, Ecuador; Maracaibo, Venezuela; and Madrid, Spain. Three franchise restaurants were closed during the quarter.

For the quarter, EBITDA decreased 28.0% to $1.9 million from $2.6 million recorded during the same quarter of the prior year while on a year-to-date basis, EBITDA of $6.8 million was 21.7% lower than the prior year amount of $8.7 million. For the quarter and year-to-date periods, the EBITDA decrease is due primarily to the sales decline, lower net franchise revenue and higher general and administrative expenses.

The net loss for the quarter was $1.1 million compared with a net loss of $581,000 during the same quarter of the prior year. On a year-to-date basis, the net loss was $2.2 million compared to a net loss of $1.2 million during the prior year.

Frank H. Steed, Chief Executive Officer and President, commented, "Although our sales continued soft during the quarter, our sales trends at comparable restaurants, while still negative, were moderately improved. We continue to focus on improving operations and developing new food items to complement our world famous ribs."

Romacorp, Inc. operates and franchises Tony Roma's restaurants, the world's largest casual dining restaurant chain specializing in ribs. The Company currently operates 55 restaurants and franchises 204 restaurants in 29 states and 26 foreign countries and territories.

Forward-Looking Comments

Statements which are not historical facts contained herein are forward-looking statements that involve estimates, risks and uncertainties, including but not limited to: consumer demand and market acceptance risk; the level of and the effectiveness of marketing campaigns by the Company; training and retention of skilled management and other restaurant personnel; the Company's ability to locate and secure acceptable restaurant sites; the effect of economic conditions, including interest rate fluctuations, the impact of competing restaurants and concepts, new product introductions, product mix and pricing, the cost of commodities and other food products, labor shortages and costs and other risks detailed in filings with the Securities and Exchange Commission.


                    ROMACORP, INC. AND SUBSIDIARIES
            CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                        (Dollars in Thousands)
                              (UNAUDITED)


                       Thirteen Weeks Ended    Thirty-Nine Weeks Ended
                       --------------------      --------------------
                        Dec. 22,   Dec. 23,      Dec. 22,  Dec. 23,
                          2002      2001           2002      2001
                       ---------  ---------      ---------  ---------

 Net restaurant sales  $  24,696  $  26,482      $  78,045  $  86,796
 Net franchise
  revenue                  2,439      2,761          7,393      7,586
                       ---------  ---------      ---------  ---------
                                                      
  Total revenues          27,135     29,243         85,438     94,382

 Cost of sales             8,009      8,528         25,233     28,609
 Direct labor              8,817      9,385         27,016     29,639
 Other                     7,505      8,045         23,519     25,423
 General and
  administrative
  expenses                 2,258      2,177          6,935      6,616
                       ---------  ---------      ---------  ---------
  Total operating
   expenses               26,589     28,135         82,703     90,287
                       ---------  ---------      ---------  ---------

 Operating income            546      1,108          2,735      4,095
 Other income (expense):
 Interest expense         (2,021)    (2,057)        (6,074)    (6,313)
 Miscellaneous income          0         52            309        342
                       ---------  ---------      ---------  ---------

 Loss before income
  taxes                   (1,475)      (897)        (3,030)    (1,876)

 Benefit for income
  taxes                     (406)      (316)          (832)      (660)
                       ---------  ---------      ---------  ---------
 Net loss              $  (1,069) $    (581)     $  (2,198) $  (1,216)
                       =========  =========      =========  =========


 Memo:
  EBITDA               $   1,904  $   2,641      $   6,845  $   8,738
                       =========  =========      =========  =========


            

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