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Strategies & Market Trends : Three Amigos Stock Thread -- Ignore unavailable to you. Want to Upgrade?

To: Sergio H who wrote (6613)	7/3/1998 2:29:00 AM
From: Cary C	Respond to of 29382

I spoke to the president Mr. Orza of EATS today. He was very helpful and responded quickly to my questions. I was curious as to the large swings in the quarterly earnings with the fourth quarter always being the strongest. Two main reasons, any acquisitions they do are usually in the first 2 quarters of the year. They normally expense the majority of the acquisitions in the first three quarters thus allowing more to the bottom line in the fourth quarter. The second and most influencing reason is a result of heavy mall traffic for the holiday season. Of their 73 stores, 55 Garfield restaurants are located in malls. He went on to explain that this was one of the main reasons they were expanding the free standing restaurants, especially Garcia's. These should help add revenues to the other quarters. A strong 1st quarter was attributed to the Garcia restaurants in Arizona. They are looking to expand throughout Arizona and Northern California. Because of the recent debt that was paid off from the sell of some of their restaurants, EATS is virtually debt free and Mr. Orza feels that they will be able to operate very comfortably on a cash basis. As acquisitions present themselves, the company will explore their options and make financing decisions with the emphasis being on increasing shareholder value. According to Mr. Orza, of the outstanding shares, approximately 1/3 is owned by insiders, 1/3 is owned by institutions and the rest is in the float. They have had three research papers done by different firms. One escapes me but the other two are North Coast Securities and First Asset out of Boston Same store sales continue to increase and they are getting very close to another acquisition. In reading through the recent shareholder proxy, I noted that portions of the officers, management and employees bonuses were given in stock instead of cash. The company believes that this will give them more incentive to help the company produce and grow. I forgot to ask him a couple of questions so I will be calling back next week. If anybody would like me to ask him a question, please let me know. Cary