Taking a page out of the Outback Steakhouse
So when Outback was taken to task for its partnership expense accounting by the SEC last year, Chang's decided to check its own standards to make sure they lined up with the preferred compensation accounting model for its partnership program. The end result will hit the company's income statements like a "won ton" brick.
Chang's must now restate its past few years of earnings sharply as it crunches its financials to treat the partnerships as compensatory. As a result, earnings per share for the last three years have been revised downward.
The move will also impact this year. Chang's had guided investors to expect $1.36 a share in earnings in 2004; that has been trimmed back to just $0.97 a share after the necessary charges. Specifically, each new namesake location opened now carries an additional $275,000 expense to comply with the SEC standards.
The company, which succeeded where casual dining rivals like Darden
Chang's is an interesting chain. In the mold of Cheesecake Factory
Have you ever eaten at a P.F. Chang's? What did you think? How do Asian foods stack up when it comes to healthier eating? What is MSG exactly? All this and more -- in the Health and Nutrition discussion board. Only on Fool.com.
Longtime Fool contributor Rick Munarriz has enjoyed his meals at his local P.F. Chang's, but he does not own shares in any companies mentioned in this story.