JERICHO, N.Y., Feb. 6, 2014 /PRNewswire/ -- Nathan's Famous, Inc. (NASDAQ:NATH) today reported results for the third quarter of its 2014 fiscal year that ended December 29, 2013.

For the fiscal quarter ended December 29, 2013:


    --  Net income increased by 4.2% to $1,107,000 as compared to $1,062,000 for
        the thirteen weeks ended December 23, 2012;
    --  Earnings per diluted share increased by 4.3% to $0.24 as compared to
        $0.23 for the thirteen weeks ended December 23, 2012; and
    --  Revenues increased by 23.3% to $18,533,000, as compared to $15,025,000
        during the thirteen weeks ended December 23, 2012.

For the thirty-nine weeks ended December 29, 2013:


    --  Net income increased by 20.2% to $7,109,000 as compared to $5,913,000
        for the thirty-nine weeks ended December 23, 2012;
    --  Earnings per diluted share increased by 19.4% to $1.54 as compared to
        $1.29 for the thirty-nine weeks ended December 23, 2012; and
    --  Revenues increased by 16.0% to $65,596,000, as compared to $56,567,000
        during the thirty-nine weeks ended December 23, 2012.

The Company also reported the following:


    --  In March 2014, our new license agreement will commence with John Morrell
        & Co. replacing SMG, Inc. as Nathan's exclusive licensee to manufacture
        and sell branded hot dog, sausage and corned beef products at retail. As
        previously disclosed, we believe the financial terms of the John Morrell
        agreement are more advantageous to us compared to the financial terms of
        the current SMG agreement. These improved terms include royalties of
        10.8% of net sales, compared to approximately 4.5% of net sales under
        the SMG agreement, and significant minimum annual royalty guarantees.
        Under the John Morrell Agreement, the minimum guarantee for the first
        year is $10 Million, and we believe that actual royalties should exceed
        the minimum. Royalties earned under the SMG agreement over the last 12
        months were $5,346,000.
    --  License royalties pursuant to all license agreements were $6,242,000
        during the thirty-nine weeks ended December 29, 2013, as compared to
        $6,104,000 during the thirty-nine weeks ended December 23, 2012.
    --  Sales from the Branded Product Program, featuring the sale of Nathan's
        hot dogs to the foodservice industry, increased by 20.3% to $40,256,000
        during the thirty-nine weeks ended December 29, 2013, as compared to
        sales of $33,464,000 during the thirty-nine weeks ended December 23,
        2012. Currently, products are being distributed throughout all 50 states
        in channels to include convenience stores, travel centers, entertainment
        venues, colleges and universities and vending.
    --  Sales from the Company-owned restaurants were $11,536,000 during the
        thirty-nine weeks ended December 29, 2013 as compared to $12,378,000
        during the thirty-nine weeks ended December 23, 2012; the decline in
        sales was due to the following: (1) Our Flagship Coney Island
        restaurant, which was severely damaged by Superstorm Sandy, reopened on
        May 20, 2013, losing eight (8) weeks of the spring season during the
        current fiscal year, compared to the post-Sandy closure of eight (8)
        weeks in November and December 2012; and (2) The temporary closing of
        our Yonkers restaurant for redevelopment from December 2012 until
        reopening in November 2013. We estimate these two factors negatively
        impacted the sales comparison by approximately $1,606,000.
    --  Sales at our two Coney Island locations were approximately $876,000
        higher in the aggregate than the comparative weeks of operations during
        the fiscal period ended December 29, 2013. Sales at our seasonal
        Boardwalk restaurant in Coney Island were approximately 16.8% higher
        during the 30 weeks of operations during the thirty-nine weeks ended
        December 29, 2013 as compared to December 23, 2012.
    --  Gross profit decreased to 20.1% of sales during the thirty-nine weeks
        ended December 29, 2013, as compared to 22.1% of sales during the
        thirty-nine weeks ended December 23, 2012 due primarily to the impact of
        the higher cost of beef on our Branded Product Program. During fiscal
        2014 period, the cost of our beef products were approximately 6.1%
        higher than the fiscal 2013 period due primarily to an unusual increase
        in the beef trimmings markets during August and September 2013. We have
        recently begun taking steps to pass the recent cost increases on through
        price increases but there can be no assurance we will be successful in
        doing so.
    --  Revenues from franchise operations were $4,248,000 during the
        thirty-nine weeks ended December 29, 2013, as compared to $4,247,000
        during the thirty-nine weeks ended December 23, 2012. Twenty-six new
        franchised units were opened during the thirty-nine weeks ended December
        29, 2013, including six Branded Menu Program outlets and eight locations
        in Moscow.
    --  Nathan's executed a Master Development Agreement for the development of
        Nathan's restaurants and retail distribution throughout Costa Rica.
    --  Nathan's realized a gain of $2,801,000 during the thirty-nine weeks
        ended December 29, 2013 in connection with the settlement of its flood
        damage and contents loss insurance claims relating to Superstorm Sandy.
    --  Nathan's recognized an impairment charge of $400,000 in connection with
        a long-term investment.
    --  Nathan's final appeal in the SMG litigation was denied.  As a result,
        the judgment of $4,910,000 and all post-judgment interest of $1,099,000,
        was satisfied on July 24, 2013.  As previously described, we accrued the
        expense of the judgment in October 2010, and have been accruing the
        expenses for post-judgment interest on a monthly basis throughout the
        appeals process.
    --  In October, 2013, Nathan's was ranked #55 on the Forbes list of the Best
        Small Companies in America and was listed as the Best Small Company in
        New York State.

About Nathan's Famous

Nathan's is a Russell 2000 Company that currently distributes its products in 50 states, the District of Columbia, Puerto Rico, the U.S. Virgin Islands, Guam, the Cayman Islands and nine foreign countries through its restaurant system, foodservice sales programs and product licensing activities. The Nathan's restaurant system currently consists of 313 units, comprised of 308 franchised units and five company-owned units (including one seasonal unit). For additional information about Nathan's please visit our website at www.nathansfamous.com.

Except for historical information contained in this news release, the matters discussed are forward looking statements that involve risks and uncertainties. Words such as "anticipate", "believe", "estimate", "expect", "intend", and similar expressions identify forward-looking statements, which are based on the current belief of the Company's management, as well as assumptions made by and information currently available to the Company's management. Among the factors that could cause actual results to differ materially include but are not limited to: economic, weather (including the continued impact of Hurricane Sandy and the three-year drought in the Midwest which has caused an increase in corn pricing and reduced supply of cattle), and continued increases in the price of beef trimmings; legislative and business conditions; the collectibility of receivables; changes in consumer tastes; the status of our licensing and supply agreements; the impact of a new supply agreement for hot dogs with John Morrell & Co., including the royalties we receive from such agreement; and the termination in 2014 of our existing hot dog supply agreement with SMG and any issues arising from or related to the transition from SMG to John Morrell & Co. as our primary hot dog supplier; the ability to continue to attract franchisees; no material increases in the minimum wage; our ability to attract competent restaurant and managerial personnel; and the future effects of any food borne illness; such as bovine spongiform encephalopathy, BSE; and the risk factors reported from time to time in the Company's SEC reports. The Company does not undertake any obligation to update such forward-looking statements.

                                                                                                                                                                                                            
    Nathan's Famous, Inc.
                                                                                                                                                                                                            
    Financial Highlights
                                                                                                                                                                                                            
                                                                                                                                                                                                                                                                                 
                                                                                                                                                                                                            Thirteen weeks ended                     Thirty-nine weeks ended
                                                                                                                                                                                                            --------------------                     -----------------------
                                                                                                                                                                                                                                                                                              
                                                                                                                                                                                                             Dec. 29,                 Dec. 23,        Dec. 29,                    Dec. 23,
                                                                                                                                                                                                             2013                     2012            2013                        2012
                                                                                                                                                                                                            ---------                ---------       ---------                   ---------
                                                                                                                                                                                                                                                                                              
                                                                                                                                                                                                                                                                                              
                                                                                                                                                                                                            (unaudited)                              (unaudited)
                                                                                                                                                                                                                                                                                              
                                                                                                                                                                                                                                                                                              
                                                                                                                                                                                                                                                                                              
    Total revenues                                                                                                                                                                                                   $18,533,000     $15,025,000                 $65,596,000     $56,567,000
                                                                                                                                                                                                                     ===========     ===========                 ===========     ===========
                                                                                                                                                                                                                                                                                              
                                                                                                                                                                                                                                                                                              
    Net income                                                                                                                                                                                                        $1,107,000      $1,062,000                  $7,109,000      $5,913,000
                                                                                                                                                                                                                      ==========      ==========                  ==========      ==========
                                                                                                                                                                                                                                                                                              
                                                                                                                                                                                                                                                                                              
    Basic income per share
                                                                                                                                                                                                                                                                                              
       Net income                                                                                                                                                                                                          $0.25           $0.24                       $1.60           $1.35
                                                                                                                                                                                                                           =====           =====                       =====           =====
                                                                                                                                                                                                                                                                                              
                                                                                                                                                                                                                                                                                              
    Diluted income per share
                                                                                                                                                                                                                                                                                              
       Net income                                                                                                                                                                                                          $0.24           $0.23                       $1.54           $1.29
                                                                                                                                                                                                                           =====           =====                       =====           =====
                                                                                                                                                                                                                                                                                              
                                                                                                                                                                                                                                                                                              
                                                                                                                                                                                                                                                                                              
    Weighted-average shares used in
                                                                                                                                                                                                                                                                                              
       computing income per share
                                                                                                                                                                                                                                                                                              
                                                                                                                                                                                                                                                                                              
      Basic                                                                                                                                                                                                            4,466,000       4,414,000                   4,447,000       4,396,000
                                                                                                                                                                                                                       =========       =========                   =========       =========
                                                                                                                                                                                                                                                                                              
      Diluted                                                                                                                                                                                                          4,622,000       4,612,000                   4,609,000       4,582,000
                                                                                                                                                                                                                       =========       =========                   =========       =========



    COMPANY                  Ronald G. DeVos,
                             Vice President -
                             Finance and CFO

    CONTACT:                 (516) 338-8500 ext.
                             229

SOURCE Nathan's Famous, Inc.