Saturday, November 14, 2009
Western Sizzlin sees solid earnings in quarter
The Roanoke-based chain is still being eyed for a merger by Steak 'n Shake.
The latest from The Ticker blog
Western Sizzlin Corp. sizzled this summer. That's good news for Steak 'n Shake Co., a hamburger chain that wants to buy Western Sizzlin.
The Roanoke-based holding company earned $3.6 million, or $1.26 a share, during the three months ended Sept. 30, up from $2.9 million, or $1.04 a share, in the same quarter of 2008. Western Sizzlin said it cut expenses in its restaurants and franchises and made more money off investments. The company franchises and operates various restaurant concepts, including Western Sizzlin and Great American Steak & Buffet Co.
Western Sizzlin's sales declined 5 percent in the quarter to $4.2 million, from $4.4 million in 2008.
Through its subsidiaries, Western Sizzlin Franchise Corp. and Western Sizzlin Stores, the company ended the three-month period with 102 restaurants in 19 states.
Western Sizzlin and Steak 'n Shake, based in Indianapolis, said last month that they intended to merge.
Through this move, Steak 'n Shake would form a subsidiary to acquire Western Sizzlin, which would become a wholly owned subsidiary of the hamburger company.
The day after the announcement, it was reported that Western Sizzlin was acquiring Steak 'n Shake.
Western Sizzlin's chief financial officer, Robyn Mabe, said Friday that the media got the story wrong.
When the companies wrote that Steak 'n Shake would "merge with and into Western," the statement did not mean that Western Sizzlin would own Steak 'n Shake.
It meant the opposite, Mabe said.
The acquisition still is subject to approval by Western Sizzlin's stockholders. If approved, Western Sizzlin no longer would be a publicly traded company.
Mabe said she does not yet know how an acquisition would impact the company's Roanoke office.
Sardar Biglari, Steak 'n Shake's CEO, also is CEO of Western Sizzlin. He is based in San Antonio.
Shares of Western Sizzlin closed Friday at $8.70.
