Profile: Luby's Inc (LUB.N)

Luby’s, Inc. (Luby’s), formerly Luby’s Cafeterias, Inc., incorporated in 1959, is a multi-branded company operating in the restaurant industry and the contract food services industry. The Company's primary brands include Luby’s Cafeteria, Luby’s Culinary Contract Services, and Fuddruckers. As of November 9, 2011, it operated 155 restaurants located throughout the United States, with 114 in Texas and the remainder in other states. In addition, the Company received royalties from 122 franchise, as of August 31, 2011, located primarily throughout the United States. The Company operates in three segments: Company-owned restaurants, franchise operations and Culinary Contract Services (CCS). On July 9, 2010, Luby’s Restaurants Limited Partnership was converted into Luby’s Fuddruckers Restaurants, LLC (LFR). The Company completed the acquisition of substantially all of the assets of Fuddruckers, Inc., Magic Brands, LLC and certain of their affiliates (collectively, Fuddruckers). Upon the completion of the acquisition, LFR became the owner and operator of 56 Fuddruckers locations and 3 Koo Koo Roo Chicken Bistro (Koo Koo Roo) locations with franchisees operating an additional 130 locations.

As of November 9, 2011, the Company operated culinary contract services at 21 locations, including 15 in the Houston, Texas area, three in Louisiana, two in Denton, Texas and one in Austin, Texas. Luby’s Culinary Services provides food service management to healthcare, educational and corporate dining facilities. As of November 9, 2011, it had 60 franchisees operating 121 Fuddruckers restaurants, of which 116 are located in 30 states, one in Canada and four in Puerto Rico.

Luby’s Cafeteria

Luby’s Cafeteria provides its customers with made-from-scratch food, service and hospitality. The cafeteria food delivery system allows customers to select freshly prepared items from the serving line, including entrees, vegetables, salads, desserts, breads and beverages, before transporting their selected items on serving trays to a table or booth of their choice in the dining area. Each restaurant offers 15 to 20 entrees, 12 to 14 vegetable dishes, 8 to 10 salads, and 10 to 12 varieties of desserts daily. Its restaurants are generally open for lunch and dinner seven days a week and all of its restaurants sell food-to-go orders. As of August 31, 2011, the number of Luby’s Cafeterias was 96.

Fuddruckers

Fuddruckers serves fresh, 100% All-American premium-cut ready for oven beef. Fuddruckers’ signature burger accounts for approximately 47% of Fuddruckers restaurant sales, its menu also includes all-natural, free-range Fudds Exotics burgers, such as buffalo, fresh rib eye steak sandwiches, various grilled and breaded chicken breast sandwiches, hot dogs, a variety of tossed and specially prepared salads and soups, fish sandwiches, wedge-cut French fries, onion rings, soft drinks, handmade milkshakes and bakery items. As of November 9, 2011, it operated 57 Fuddruckers locations and 3 Koo Koo Roo locations. As of November 9, 2011, the Company had contracts with five long-term acute care hospitals, five acute care medical centers, two ambulatory surgical centers, two behavioral hospitals, four business and industry clients, and three higher education institutions.

As of November 9, 2011, Luby’s Cafeterias had 95 operating locations with seating capacity for 250 to 300 customers at each location. It owns the underlying land and buildings in which 67 of its Luby’s restaurants are located. In addition to the owned locations, 28 Luby’s Cafeteria restaurants are held under leases, including eight in regional shopping malls. Each Fuddruckers restaurant generally has seating capacity for 125 to 200 customers while each Koo Koo Roo has seating capacity for 90 to 125 customers. The Company owns the underlying land and buildings in which 14 of its Fuddruckers restaurants are located. The 3 Koo Koo Roo locations are located on leased property. In addition to the 14 owned Fuddruckers locations, 43 restaurants are held under leases. The Company has four owned other use properties; one is used as a Bake Shop that supports the baked products for operating Luby’s Cafeteria. Three locations are leased to third party tenants utilizing the entire building.

Culinary Contract Services

As of November 9, 2011, the Company had contracts with five long-term acute care hospitals, five acute care medical centers, two ambulatory surgical centers, two behavioral hospitals, four business and industry clients, and three higher education institutions. Its culinary contract services operation (CCS), branded as Luby’s Culinary Services, consists of a business line servicing healthcare, higher education and corporate dining clients.