ORLANDO, Fla. — First-quarter profit at Planet Hollywood Intl. Inc. tumbled 91%, but the restaurant franchiser said Monday that its stable of celebrities should help boost the number of patrons at its movie memorabilia-themed franchises and eventually boost earnings.
Net income, which was nonetheless in line with analysts’ forecasts, fell to $900,000, or 1¢ per diluted share, from the year-ago’s $10.5 million (10¢).
The company, which counts actors Arnold Schwarzenegger, Bruce Willis and Demi Moore among its major shareholders, said revenue slipped to $96.5 million from $101.6 million.
President Robert Earl said Planet Hollywood was on track in its efforts to boost profits. These goals include improving same-store sales at its restaurant-retail units and achieving 1998 operating cash flow (or earnings before interest, taxes, depreciation and amortization) of $115 million to $120 million. But he cautioned that the company’s eight-point plan was not expected to boost its financial performance immediately.
Planet Hollywood, which recently announced plans to build a hotel/restaurant complex in New York City’s Times Square, has already gotten a vote of confidence from one major shareholder.
Just last week, Saudi Arabia’s Prince Alwaleed bin Talal said he raised his stake in the company to about 4% of common shares from 1%. The prince and Planet Hollywood formed a strategic pact in April in which the prince agreed to develop up to 34 Planet restaurant-merchandise units in 23 countries.
At the end of the first quarter, the company had 83 Planet Hollywood units in operation, including 46 company-owned units and 37 franchised units in 34 countries.