The company reported a 23 cent loss per share, or $41.8 million, in 2000, versus a 20 cent loss per share, or $36.5 million, in 1999. Of the 2000 loss, $30.8 million was related to interest expense throughout the year and $56.3 million was related to a fourth quarter provision for divestitures and write-down of long-lived assets, including $47.8 million related to the write-off of Koo Koo Roo goodwill which was determined to be unrecoverable. Partially offsetting these losses was a gain of $60.7 million related to the El Torito division sale.
Sales in the fourth quarter of 2000 were $75.6 million, a decrease of 40.8% from 1999 primarily due to the absence of the former El Torito division sales and the operation of 10 fewer Chi-Chi's restaurants. Fourth quarter 2000 losses were $74.3 million, or 41 cents per share, versus $14.1 million, or 8 cents per share, in 1999. The losses in the fourth quarter of 2000 included the $56.3 million provision for divestitures and write-down of long-lived assets discussed above.
Prandium chairman, president, and chief executive officer, Kevin S. Relyea, commented on the 2000 results. "It was a difficult year. Much of our attention was focused on the sale of El Torito and the subsequent down-sizing of our G&A support structure while continuing to manage our other brands. We have major goals to accomplish over the next year as we work to improve our businesses and restructure the company's debt.''
As previously announced, Prandium's subsidiary FRI-MRD Corporation elected not to pay the semi-annual interest payments past due on its outstanding long term debt. Prandium also announced that it elected not to pay the interest payment that came due on February 1, 2001 on its outstanding long-term debt. Under the terms of the note agreements governing the FRI-MRD debt and the indentures governing the Prandium debt, these non-payments of interest became ``Events of Default'' and the holders of such debt have become entitled to certain rights, including the right to accelerate the debt. In addition, the vesting of the right (whether or not exercised) of the holders to accelerate the debt caused an "Event of Default'' to occur under Prandium's Credit Facility with Foothill Capital Corporation and Foothill became entitled to certain rights.
Prandium continues to negotiate with certain creditors to determine an acceptable capital restructuring of Prandium and its subsidiaries. There can be no assurances that Prandium will be able to successfully negotiate with its creditors or successfully resolve its capital structure.
Prandium(TM) operates a portfolio of full-service and fast-casual restaurants including Koo Koo Roo®, Hamburger Hamlet®, and Chi-Chi's® in the United States and also licenses its concepts outside the United States. Prandium, Inc. is headquartered in Irvine, California. To contact the company call (949) 757-7900, or the toll free investor information line at (888) 288-PRAN, or link to www.prandium.com. Address email to [email protected]