On July 11, Ruby Tuesday (NYSE:RI) released FY 2006 earnings for the period ended June 6.

  • Net profit fell because of higher operating expenses, primarily increased advertising. Thanks to share buybacks, though, earnings per share actually increased almost 6%.
  • Accounts receivable grew much faster than revenue, something to keep an eye on going forward.
  • Inventory is being used more efficiently, since it did not climb as quickly as sales.

(Figures in millions, except per-share data)

Income Statement Highlights

Avg. Est.

FY 2006

FY 2005

Change

Sales

$1,300

$1,306.2

$1,110.3

17.6%

Net Profit

--

$101

$102.3

(1.3%)

EPS

$1.63

$1.65

$1.56

5.8%

Diluted Shares

61.31

65.52

(6.4%)



Get back to basics with a look at the income statement.

Margin Checkup

FY 2006

FY 2005

Change*

Gross Margin**

73.45%

74.01%

(0.56)

Operating Margin

12.53%

14.35%

(1.82)

Net Margin

7.73%

9.21%

(1.48)

*Expressed in percentage points.
**Defined as sales less cost of food and beverage, without revenue from franchisees.

Margins are the earnings engine. See how they work.

Balance Sheet Highlights

Assets

FY 2006

FY 2005

Change

Cash + ST Invest.

$22.36

$19.78

13%

Accounts Rec.

$12.02

$8.14

47.7%

Inventory

$17.43

$16.99

2.6%



Liabilities

FY 2006

FY 2005

Change

Accounts Payable

No Data

$46.59

N/A

Long-Term Debt

$375.64

$247.22

51.9%



Learn the ways of the balance sheet.

Cash Flow Highlights

FY 2006

FY 2005

Change

Cash From Ops.

No Data

$183.14

N/A

Capital Expenditures

$171.6

$162.37

5.7%

Free Cash Flow

No Data

$20.77

N/A



Find out why Fools always follow the money.

Related Companies:

  • Applebee's (NASDAQ:APPB)
  • Brinker International (NYSE:EAT)
  • Darden Restaurants (NYSE:DRI)
  • O'Charleys (NASDAQ:CHUX)

Related Foolishness:

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At the time of publication, Jim Mueller had no position in any company mentioned. Fool rules are here.