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Non-Tech : RAINFOREST CAFE -- Ignore unavailable to you. Want to Upgrade?

To: Richard Phillips who wrote (3545)	12/2/1997 12:00:00 PM
From: Richard Phillips	Read Replies (1) \| Respond to of 4704

Found this on Yahoo Msg for RAIN: ++++++++++++++++++++++++++++++++++ Subj: The significance of retail space-reply to #8 By: daveo135 Date: Dec 2 1997 7:38 A.M PST Reply To: Msg. 8 by GoBevo9293 Yes, I used the term "retail space" loosely to refer to the combination of resturant plus retail space, and that is probably confusing. Consider what is happening in this company. Currently RF has about 170,000 square feet of space that has been open long enough to be contributing to earnings (note that every domestic location has turned proftable within 60 days of opening). If we take the EPS and divide by the 170,000, we get the average contribution to the earnings per square foot of space. Now multiply this by the expected square footage into the future and you get a simple-minded estimate of future earnings. According to the announced plans from RF, by this time next year, there will be about 450,000 square feet open for those 60 days mentioned above, a rough tripling of what we have now. This tells me that EPS will roughly triple in the next 12 months. I expect that the stock price will reflect this. I have not included in this any of the international locations, which are partnerships. This is just the calculation based on domestic locations. I have been modelling this for a number of quarters and have been quite accurate at predicting earnings with this model (my model has a few more bells and whistles, but not a lot - this isn't really this hard to get a sense of what is happening). Finally, RF has stated that they think there are 100 domestic locations where they could successfully open a restuarant. We curretly have 10 or 11 open. The growth path on this stock is pretty obvious: a VERY successful concept, lots of cash, no debt, large profit margins compared to typical restuarants, and a 100% success rate with new openings virtually paying of the opening costs in roughly a year. And the concept has staying power. I was at the Mall of America restuarant last Saturday at 2:45 pm. The wait for a table for 4 was 2 hours 45 minutes in the middle of the afternoon. This one has been open for 3 years now and is still packed. Doubt if you wish, but I cannot yet find the torpedo coming in that will sink this ship. (eom) +++++++++++++++++++++++++++++++++++++++ pops >