CHST Creative Host Services (MM)

Creative Host Services, Inc. Announces Fourth Quarter and Year End Financial Results for 2003 * 2003 REVENUES INCREASED 14.6% TO $39.7 MILLION * 2003 INCOME FROM OPERATIONS INCREASED 29.8% TO $2.5 MILLION * 2003 EPS OF $0.07 VERSUS $0.16 PRIMARILY DUE TO INCREASED INTEREST EXPENSE AND HIGHER INCOME TAX PROVISION * 4TH QUARTER REVENUE INCREASED 22.7% TO $10.9 MILLION * 11TH CONSECUTIVE QUARTER OF PROFITABILITY SAN DIEGO, April 2 /PRNewswire-FirstCall/ -- Creative Host Services, Inc. today announced financial results for the fourth quarter and year ended December 31, 2003, the Company's 11th consecutive quarter and third consecutive year of profitability. Revenues for the three months ended December 31, 2003 increased 22.7 percent to $10,909,074 compared to revenues of $8,892,003 for the comparable prior year period. Net income was $39,442, compared to net income of $123,158 last year. Revenues for the fiscal year ended December 31, 2003 were $39.7 million, an increase of14.6 percent compared to revenues of $34.6 million for the comparable prior year period. Income from operations increased 29.8 percent to $2.5 million, compared to $1.9 million reported last year. Net income for the year decreased to $622,700, or $0.07 per diluted share, from $1.3 million, or $0.16 per diluted share last year. The decline in net income was primarily attributable to an increase in interest expense due to the conversion and early retirement of convertible notes and an increase in theprovision for income taxes. The balance sheet also remained strong with $1.5 million in cash. Shareholders' equity was $19.1 million on December 31, 2003, representing a 7.8 percent increase from the $17.7 million on December 31, 2002. Sayed Ali, President and Chairman of the Board, commented, "Continued improvement in revenue and operating income produced another profitable quarter and year for the Company. Increased interest expense and increased income taxes impacted our net income, but operating income increased compared to last year, demonstrating our improved efficiency and the ability of management to leverage its increased scale. We continue to work to obtain the approval of airport and government authorities to proceed with our plannedmerger with Compass Group USA, and anticipate obtaining the required consents and finalizing the other conditions of the offer as quickly as possible." About Creative Host Services: Creative Host Services, Inc. (including its wholly-owned subsidiary,GladCo Enterprises, Inc.) is engaged in the business of acquiring, managing, and operating airport concessions such as food and beverage, cocktail and lounge, and news and gift retail facilities at various locations across the United States. The company operates more than 130 concession facilities at 30 airports and enjoys co-branding relationships with several national and regional companies such as Carl's Jr., TCBY Yogurt, Samuel Adams Brew Pubs, Mrs. Fields Cookies, Pretzelmaker, Nathan's Famous Hot Dogs, Hot Licks Bar & Grill, Yuengling Brewery, and Creative Croissants. For additional corporate information please visit the company's corporate website -- http://www.creativehostservices.com/. Safe Harbor Provision: Statements contained in this press release that are not descriptions of historical facts are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act. Forward looking statements include statements related to anticipated trends in revenues, plans for future expansion and acquisition of new concession contracts, future financial performance and projected revenues and income. Such statements often include words such as "anticipate," "estimate", "project", "intends," "believes," "plans, "approximately," "likely," and similar expressions. Because Forward-looking statements are subject to risks and uncertainties, actual results may differ materially from those expressed or implied by such forward looking statements. The risks and uncertainties that contribute to the uncertain nature of forward looking statements include, but are not limited to, those related to competition, development and construction activities, dependence on existing management, leverage and debt service, possible early termination on concession contracts, government regulation, domestic and international economic conditions and the impact of war and terrorism on airline travel. Additional information on factors that may affect the business and financial results ofthe company can be found in documents filed by the Company with the Securities and Exchange Commission. All forward- looking statements contained in this press release speak only as of the date on which they were made. Creative Host Services, Inc. undertakes no obligation to update such statements to reflect events that occur or circumstances that exist after the date on which they were made. For further information, please contact: Creative Host Services, Inc., +1-858-675-7711; or Hayden Communications, Inc., +1-843-272-4653, for Creative Host Services, Inc. CREATIVE HOST SERVICES, INC. CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS Three Months Ended Year Ended December 31, December 31, 2003 2002 2003 2002 Total Revenues $10,909,074 $8,892,003 $39,684,837 $34,615,454 Cost of Goods Sold 2,912,920 2,398,672 10,473,120 9,319,742 Gross Profit 7,996,154 6,493,331 29,211,717 25,295,712 Operating Costs and Other Expenses 7,934,214 6,410,691 28,145,567 23,969,426 Pretax Income 61,942 82,640 1,066,150 1,326,286 Provision (Benefit) for Income Taxes 22,498 (40,518) 443,450 68,481 Net Income $39,442 $123,158 $622,700 $1,257,805 Basic Earnings Per Share $.00 $0.01 $ 0.08 $0.16 Diluted Earnings Per Share $.00 $0.01 $0.07 $0.16 Basic Weighted Average Shares 8,435,247 8,006,210 8,218,043 7,913,223 Diluted Weighted Average Shares 8,807,542 8,110,037 8,438,978 7,987,819 BALANCE SHEET HIGHLIGHTS As of December 31 2003 2002 Cash $1,452,643 $1,241,766 Total Current Assets 3,234,806 2,669,262 Net Property & Equipment 22,287,970 17,073,751 Other Assets 6,828,297 5,984,384 Total Assets 32,351,073 25,727,397 Current Liabilities $4,869,709 $4,005,567 Shareholders' Equity 19,147,238 17,749,962 Total Liabilities and Equity 32,351,073 25,727,397 DATASOURCE: Creative Host Services, Inc. CONTACT: Creative Host Services, Inc., +1-858-675-7711; or Hayden Communications, Inc., +1-843-272-4653, for Creative Host Services, Inc. Web site: http://www.creativehostservices.com/

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