Max & Erma's Announces Four New RestaurantOpenings and the Closing of Two Under-PerformingUnits.
Business Editors
COLUMBUS, Ohio--(BUSINESS WIRE)--Oct. 6, 2000
Max & Erma's Restaurants, Inc. (Nasdaq:MAXE) today announced that it will open four new restaurants and has closed two under-performing locations.
Todd Barnum, Chairman and Chief Executive Officer of Max & Erma's, said the Company will undertake the most aggressive opening schedule in the Company's history with the opening of four restaurants between late October and mid-November. Mr. Barnum said that in a span of three weeks the Company will open restaurants in Prospect, Kentucky, its second location in suburban Louisville; Hyde Park, Ohio, a suburb of Cincinnati; Fox Chapel, Pennsylvania, the Company's seventh location in the Pittsburgh market and a second Grand Rapids, Michigan location in the suburb of Grandville.
Mr. Barnum said that with the last 10 new restaurants reporting average sales 10 to 15 percent above chain average, he is very optimistic about the impact these new restaurants will have on fiscal 2001, which begins in approximately three weeks. Mr. Barnum said construction is essentially complete on the four new restaurants and new-hire training is underway. The Company has been planning and coordinating the opening for several months and is prepared. The Company expects to open five to six additional locations during the balance of fiscal 2001.
The Company also announced the recent closing of two under-performing units in the Flats area of Cleveland, Ohio and Greenville, South Carolina. The Company expects to take a fourth quarter non-cash pre-tax charge of approximately $2.5 million related to the closings. The Company estimates that the closings will improve pre-tax earnings and cash flow by approximately $500,000 annually. Mr. Barnum said that the two locations had not responded to efforts to improve sales and it's therefore time to focus the Company's assets and energies elsewhere. The write-off relates primarily to the net book value of the restaurant leasehold improvements.
After the two closings, Max & Erma's owns and operates 55 casual dining full-service restaurants in Akron, Columbus, Cleveland, Cincinnati, Dayton, Niles and Toledo, Ohio; Indianapolis, Indiana; Detroit, Ann Arbor and Grand Rapids, Michigan; Pittsburgh and Erie, Pennsylvania; Lexington and Louisville, Kentucky; Chicago, Illinois; Charlotte, North Carolina; Atlanta, Georgia and Norfolk, Virginia. The Company also franchises three restaurants in Cleveland and Columbus, Ohio and on the Ohio Turnpike. Five Max & Erma's restaurants are under construction in Cincinnati, Ohio; Louisville, Kentucky; Pittsburgh, Pennsylvania; Grand Rapids, Michigan and Charlotte, North Carolina. A franchised restaurant is under construction in St. Louis, Missouri. The Company's common shares are traded on the NASDAQ National Market System under the symbol MAXE.
