New York Bagel Enterprises Inc

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International Guild of Hospitality & Restaurant Managers

Business Summary
OTC: NYBSQ

Financial Summary

NYBSQ owns and franchises NY Bagel and Lots A' Bagels eateries, specializing in traditional NY style bagels. As of 9/99, NYBSE owned 30 and franchised 16 eateries. For the 39 weeks ended 9/29/99, revenues fell 27% to $10.7 million. Net loss fell 89% to $541 thousand. Revenues reflect decreased number of stores in operation, competition and industry maturation. Lower loss reflects the absence of impairment charge and reduction in management staff and effort to control costs.

Expanded Business Summary

New York Bagel Enterprises Inc. owns and franchises New York Bagel and Lots A' Bagels restaurants that provide a wide variety of bagels that are made from scratch, boiled, and baked in the traditional New York style. Breakfast menu items include a wide variety of bagels and custom-blended cream cheeses, gourmet coffees, muffins, and croissants. Lunch and dinner items include an assortment of bagel delicatessen sandwiches, prepared salads, cookies, and soft drinks. As of March 1, 1999, the Company has 37 Company-owned restaurants primarily located in Oklahoma, Kansas, Colorado, Alabama, Texas, and Tennessee and 17 franchised restaurants located throughout the United States.

New York Bagel restaurants serve up to 20 varieties of bagels that are made from scratch, boiled, and baked throughout the day. Menu items are prepared in accordance with the Company's specifications using quality ingredients such as Philadelphia Brand cream cheese, Kraft cheeses and premium deli meats. Generous portions of cream cheese are applied on its breakfast bagel and generous portions of meat are served on each of its deli sandwiches.

The breakfast menu at New York Bagel restaurants includes a variety of bagels and custom-blended cream cheeses, breakfast sandwiches on bagels, gourmet coffees, muffins and croissants. Lunch and dinner items include a wide range of delicatessen sandwiches made on bagels or other breads, salads, cookies and soft drinks. The Company also has been able to successfully operate drive-through windows at certain New York Bagel restaurants.

The Company's prototypical New York Bagel restaurant is decorated in rich colors and dark woods and contains a mixture of booth, table and barstool seating and, where available, outdoor seating. Exposed ceilings with drop lighting and a combination of tile and carpeted flooring are used to enhance its comfortable ambiance. Walls are covered with black and white photographs depicting classic New York scenes. The Company's restaurants are configured to facilitate a smooth flow of dine-in and carryout traffic while retaining a casual, cafe atmosphere.

Bagels and other baked products are displayed prominently behind a glass counter while other items such as salads, packaged cream cheese for take-out and specialty sodas and drinks are located in an open, self-serve refrigerated area next to the cash register. Restaurant staff prepares sandwich and other menu items behind the counter for dine-in and take-out customers.

Dine-in customers' food is delivered directly to the table. The restaurants serve cappuccino and espresso and a fountain drink and gourmet coffee station are placed in the dining area for customer convenience. Retail merchandise, including logo clothing, coffee mugs and gift items, are displayed throughout the restaurant. The Company's restaurants are typically located in strip shopping centers or freestanding buildings that provide visibility, curb appeal and accessibility. Certain limited hour satellite restaurants are located in office buildings and are open during business hours Monday through Friday.

As of March 1, 1999, there were 37 Company-owned restaurants located in Oklahoma, Kansas, Tennessee, Texas, Colorado and Alabama and 17 franchised restaurants located in nine states operated by 10 franchisees. In addition, the Company is a joint venture partner with Western Country Clubs, Inc. in a co-branded New York Bagel and Atomic Burrito restaurant located in Oklahoma and an Atomic Burrito restaurant located in Kansas, both of which are being converted from New York Bagel restaurants. In addition to developing new restaurants, as of March 1, 1999 the Company has acquired one bagel restaurant in Tennessee, seven Lots A' Bagels restaurants and a bagel commissary in Colorado, and four franchised New York Bagel restaurants in Texas and Kansas.

The quick-service restaurant industry is intensely competitive and generally characterized by low barriers to entry. There are a growing number of significant national, regional and local bagel restaurant chains operating both owned and franchised bagel restaurants including Einstein/Noah Bagel Corp., Brueggers Bagel Bakery, Manhattan Bagel Company, Inc. and BAB Holdings, Inc.

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Disclaimer:
The data included within the Financial section is solely for information and does not construe a recommendation and/or endorsement by IGHRM or its members to invest funds with any of the companies listed. You are strongly urged to obtain professional advice with qualified individuals or corporations for any investments of funds.