UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Current Report
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) September 9, 2004
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Applebee's International, Inc.
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(Exact name of registrant as specified in its charter)
Delaware 000-17962 43-1461763
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(State or other jurisdiction of (Commission (I.R.S. Employer
incorporation or organization) File Number) Identification No.)
4551 W. 107th Street, Overland Park, Kansas 66207
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(Address of principal executive offices and zip code)
(913) 967-4000
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(Registrant's telephone number, including area code)
None
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(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions:
[ ] Written communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
Item 7.01. Regulation FD Disclosure
On September 9, 2004, Applebee's International, Inc. (the "Company") issued
a press release entitled "Applebee's International Outlines Future Growth Plans;
Development Potential of Applebee's Concept Increased to at Least 3,000 Domestic
Restaurants; Company Continues to Expect Long-term EPS Growth of 14-17 Percent."
The release contained the following information.
FOR IMMEDIATE RELEASE
Contact: Carol DiRaimo,
Vice President of Investor Relations
(913) 967-4109
Applebee's International Outlines Future Growth Plans
Development Potential of Applebee's Concept
Increased to at Least 3,000 Domestic Restaurants
Company Continues to Expect Long-term EPS Growth of 14-17 Percent
Overland Park, Kan., September 9, 2004 -- At a company-sponsored conference held
today, Applebee's International, Inc. (Nasdaq:APPB) reviewed its future growth
plans with analysts and investors. Lloyd L. Hill, chairman and chief executive
officer, and several members of the Applebee's management team presented topics
ranging from the increased domestic potential of the Applebee's system to an
update of the company's long-term growth and earnings outlook.
Mr. Hill said, "The momentum and marketplace success we've achieved over the
past few years is a direct result of our singular focus on the Applebee's brand
and the pipeline of innovation that we've built over that time. As the largest
casual dining concept in the world, we know that a unique opportunity exists to
leverage our brand, system size and scale to optimize future growth."
David L. Goebel, chief operating officer, reviewed Applebee's development and
operating strategies. Mr. Goebel said, "As a result of our continued success in
penetrating markets of various sizes, overall category growth and future
consumer demand, we now believe the ultimate domestic potential of the
Applebee's system to be at least 3,000 units, a 30% increase from the potential
we believe existed a little over two years ago."
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John C. Cywinski, chief marketing officer, discussed the company's marketing
strategies. Mr. Cywinski said, "We are clearly in an era of big power brands in
casual dining. These are brands that can use national media to increase consumer
awareness and gain market share. Recognizing this opportunity, beginning in
2005, the required contribution to the national advertising fund for both
company and franchise restaurants will increase by 0.5% to 2.75% of sales while
the amount required to be spent locally will decrease 0.5% to 1.0% of sales.
This shift will allow us to convey multiple messages on a national level to our
guests, including our branded campaign events, Carside To Go(TM), our
partnership with Weight Watchers, and our neighborhood branding messages."
Steven K. Lumpkin, chief financial officer, discussed the use of the company's
strong balance sheet and substantial free cash flow for increased company
development, future franchise acquisitions and stock repurchases. Mr. Lumpkin
said, "The strategies we outlined today will provide us with a solid foundation
for continued growth. We continue to expect annual earnings per share growth of
14 to 17 percent over the next three to five years beginning in 2005. We are
also committed to maintaining our return on equity, which is already one of the
highest in the industry, of at least 20 percent."
Mr. Hill concluded, "Given our current view of the potential of the Applebee's
brand, we still believe that we do not need another concept to meet our growth
targets over the next three to five years. Although we will be both
opportunistic and selective about making an acquisition, any interest in a
second concept will not be at the expense of maximizing the core value of
Applebee's."
BUSINESS OUTLOOK
The company provided guidance as to its future growth for the next three to five
years beginning in fiscal year 2005.
o System-wide unit growth is expected to be between 7 and 8 percent
annually.
o System-wide comparable sales are expected to increase annually by at
least 3 to 4 percent.
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o The combination of restaurant operating margin and general and
administrative expense leverage, stock repurchase activity, and the
impact of potential franchise acquisitions are expected to contribute 4
to 5 percent to annual earnings per share growth.
o Earnings per share for the next three to five years are expected to
increase annually by 14 to 17 percent.
Applebee's International, Inc., headquartered in Overland Park, Kan., develops,
franchises and operates restaurants under the Applebee's Neighborhood Grill &
Bar brand, the largest casual dining concept in the world. As of September 9,
2004, there were 1,633 Applebee's restaurants operating system-wide in 49 states
and nine international countries. Additional information on Applebee's
International can be found at the company's website (www.applebees.com).
Certain statements contained in this release, including those set forth in the
Business Outlook section, are forward-looking and based on current expectations.
There are several risks and uncertainties that could cause actual results to
differ materially from those described, including but not limited to the ability
of the company and its franchisees to open and operate additional restaurants
profitably, the ability of its franchisees to obtain financing, the continued
growth of its franchisees, and its ability to attract and retain qualified
franchisees, the impact of intense competition in the casual dining segment of
the restaurant industry, and the company's ability to control restaurant
operating costs which are impacted by market changes, minimum wage and other
employment laws, food costs and inflation. For additional discussion of the
principal factors that could cause actual results to be materially different,
the reader is referred to the company's current report on Form 8-K filed with
the Securities and Exchange Commission on February 11, 2004. The company
disclaims any obligation to update these forward-looking statements.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
APPLEBEE'S INTERNATIONAL, INC.
(Registrant)
Date: September, 9 2004 By: /s/ Steven K. Lumpkin
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Steven K. Lumpkin
Executive Vice President and
Chief Financial Officer
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