Earnings before income taxes for the thirty-nine weeks ended December 23, 2001 were $3,342,000 as compared to $3,229,000 for the thirty-nine weeks ended December 24, 2000. Net earnings for the fiscal 2002 period were $1,879,000 or $0.27 per diluted share as compared to $1,823,000 or $0.26 per diluted share in the prior fiscal year.
During the fiscal 2002 period, earnings before income taxes included the reversal of a previously recorded litigation reserve of $210,000 in connection with the Company's successful appeal and gains of $916,000 from the sale of two restaurants. Earnings before income taxes for the fiscal 2001 period included revenue of $447,000 in connection with the introduction of a consolidated food distribution agreement, a $500,000 transfer fee in connection with the change in ownership of its principal supermarket licensee and incurred lease termination expenses of $366,000.
Total revenues were $34,041,000 in the fiscal 2002 period as compared to $36,983,000 in the fiscal 2001 period. Systemwide sales of the Company's brands, including supermarket sales by the Company's hot dog licensee, were $203,823,000 for the thirty-nine weeks ended December 23, 2001, as compared to $220,085,000 for the thirty-nine weeks ended December 24, 2000.
Earnings before income taxes for the thirteen week quarter ended December 23, 2001 were $460,000 as compared to $447,000 for the thirteen week quarter ended December 24, 2000. Net earnings for the fiscal 2002 quarter were $263,000 or $0.04 per diluted share as compared to $145,000 or $0.02 per diluted share in the prior fiscal year. Total revenues were $10,380,000 in the third quarter fiscal 2002 as compared to $11,418,000 in the third quarter fiscal 2001.
The company also reported the following:
• In the wake of the events of September 11, 2001, there was a decline in revenues in a significant number of company-owned and franchised restaurants operating primarily in Las Vegas, South Florida and at airports throughout the United States.
• Fewer company-owned restaurants operated, primarily due to the Miami Subs divestiture strategy, which lowered revenues by approximately $3.0 million but improved restaurant profits by approximately $41,000 (excluding any one time gains or future royalties) as compared to the fiscal 2001 thirty-nine week period.
• The introduction of extensive co-branding into the Miami Subs restaurant system, enabling the July 2001 launch of its new "Miami Subs Plus'' concept in South Florida. Currently, 135 of the company's Nathan's, Miami Subs, and Kenny Rogers Roasters restaurants are co-branded with another of its brands or with the Arthur Treacher's brand.
• The Branded Product Program, featuring the sale of Nathan's hot dogs to the foodservice industry, has continued to grow, generating sales of approximately $3,534,000 during the fiscal 2002 thirty-nine week period as compared to $2,880,000 during last year's comparable period.
• Sales of Nathan's products sold in supermarkets and club stores continue to result in year over year increases in royalties, increasing 7.0% for the fiscal 2002 thirty-nine week period over the fiscal 2001 thirty-nine week period.
• The purchase of 35,516 shares of its common stock since the adoption of a share repurchase program on September 14, 2001.
Today Nathan's Famous, Inc., consists of 23 company-owned units, 377 franchised or licensed units, and more than 1,400 Branded Product points of sale, located within thirty-nine states, the District of Columbia and sixteen foreign countries featuring the Nathan's, Miami Subs and Kenny Rogers Roasters brands.