News

Chuck E. Cheese's Q3 comps rise 5.3%

October 14, 2003

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IRVING, Texas -- Comparable-store sales at Chuck E. Cheese's rose 5.3 percent for the third quarter, ended Sept. 28. The increase marks the second consecutive quarterly positive comp-sales increase for the eatertainment company.

Stock of its parent company, CEC Entertainment, has risen in step with its sales, climbing from a 2003 low of $23.49 per share to $43.65 at the market's close on Oct. 15.

According to a news release, revenues for the period were up 14.2 percent and diluted earnings per share increased 8.5 percent despite a $4.25 million after-tax charge of related to the settlement of a labor dispute.

CEC President Mike Magusiak said the company expects earnings to land in the $3 to $3.05 range for the year, assuming "a modest increase in comparable-store sales and an increase in food costs of approximately $1.2 million due to higher cheese prices in the fourth quarter ... ."

Regarding the settlement of the labor and wage dispute, Magusiak said in a separate news release: "Recent developments in the case caused us to conclude that it was in the company's best interest to settle the lawsuit at this time. While we deny all liability, the company has agreed to the settlement in order to resolve all of the plaintiff's claims without engaging in protracted litigation."

CEC operates a system of 455 Chuck E. Cheese's restaurants in 47 states.