Sonic Reports on Impact of Hurricane Rita
Most Drive-Ins Back Open and Operating
OKLAHOMA CITY (Monday, September 26, 2005) -
Sonic Corp. (SONC - news), the nation's largest chain of drive-in restaurants, today announced that Hurricane Rita has affected the operations of a number of partner and franchise drive-ins in the states of Texas and Louisiana. While interruptions to communications and power systems, blocked roads, and restricted access in some areas have hampered the company's efforts to assess the full impact of the storm, the company reported the following:
- Approximately 250 to 300 Sonic drive-ins, including roughly 90 partner drive-ins, closed beginning September 20 in anticipation of the storm. - Most of the affected drive-ins have now reopened, although 50 to 60 remain closed either due to structural damage or continued power loss.
Approximately 10 of the closed drive-ins are partner drive-ins. - Management estimates that lost sales due to the closures may result in a reduction in the growth rate of revenues of approximately 1% for the first fiscal quarter ending November 30, 2005. However, the extent of the revenue loss likely will be mitigated partially by particularly brisk sales at drive-ins bordering the impact areas, as well as strong sales at affected drive-ins once they are able to reopen.
The company also reported that 14 franchised drive-ins in Louisiana and Mississippi remain closed as a result of Hurricane Katrina and are likely to remain closed for an extended period. The remaining drive-ins affected by Hurricane Katrina have reopened and are fully operational.
Clifford Hudson, Chairman, Chief Executive Officer and President, commented, "We are most concerned about the safety and security of the members of our Sonic family in areas hit by the recent hurricanes, and most of our efforts to date have focused on our people. While these events may have an impact on our business in the short run, our confidence in the fundamental strength of the Sonic brand and the momentum we have built in our business over the last two years remains unchanged. We fully expect that the new fiscal year just started will again reflect solid financial performance."
The secondary impact of Hurricanes Katrina and Rita on both the cost and availability of construction materials also may constrain development activity, particularly in the near future. Management plans to more fully address the potential impact from all aspects of the hurricanes during its scheduled conference call following the release of year-end results in mid- October.
This press release contains forward-looking statements within the meaning of the federal securities laws. There are certain important factors that could cause actual results to differ materially from those anticipated by the statements made herein. Among the factors that could cause actual results to differ from predicted or expected results are: delays in opening or reopening drive-ins because of weather, strikes, local permitting or other reasons; increased competition; cost increases or shortages in raw food products; risks of and publicity surrounding foodborne illness; and the possibility of unforeseen events affecting the industry generally. The company undertakes no obligation to publicly release revisions to these forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unforeseen events, except as required to be reported under the rules and regulations of the Securities and Exchange Commission.
Sonic, America's Drive-In, originally started as a hamburger and root beer stand in 1953 in Shawnee, Okla., called Top Hat Drive-In, and then changed its name to Sonic in 1959. The first drive-in to adopt the Sonic name is still serving customers in Stillwater, Okla. Sonic has over 3,000 drive-ins coast to coast and in Mexico. More than a million customers eat at Sonic every day. For more information about Sonic Corp. and its subsidiaries, visit Sonic at http://www.sonicdrivein.com
For More Infromation Please contact:
Stephen C. Vaughan, Vice President and Chief Financial Officer
Sonic Corp Phone: (405) 225-4800
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COMPANY INFORMATION
Sonic Drive In Restaurants
300 Johnny Bench Dr.
Oklahoma City,
OK
Phone: (405)225-5000
Toll Free: (800)569-6656
Fax: (405)225-5963
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