FOR IMMEDIATE RELEASE

Contact:      Carol DiRaimo, Vice President of Investor Relations
              (913) 967-4109

  Applebee's International Reports First Quarter 2006 Diluted Net Earnings Per
    Share of $0.36 Including Impairment Charge and Stock-Based Compensation

OVERLAND  PARK,  KAN.,  April  26,  2006  --  Applebee's   International,   Inc.
(Nasdaq:APPB) today reported net earnings of $27.2 million, or $0.36 per diluted
share,  for the first  quarter  ended  March 26,  2006 as  compared to $0.38 per
diluted  share for the first  quarter of 2005.  Excluding  impairment  and other
restaurant   closure  costs  of  $1.6  million   ($1.0   million   after-tax  or
approximately  $0.01 per share) and  stock-based  compensation  of $6.2  million
($4.0 million  after-tax or  approximately  $0.05 per share),  net earnings were
$32.2  million,  or $0.43 per diluted  share,  for the first  quarter of 2006. A
reconciliation  of  non-GAAP  measurements  to GAAP  results is attached to this
release.

System-wide  domestic  comparable  sales for the first quarter of 2006 increased
2.6 percent,  the 31st consecutive  quarter of comparable sales growth.  Company
and domestic franchise restaurant comparable sales increased 1.2 percent and 3.1
percent, respectively, for the quarter.

The  company  also  reported  comparable  sales  for the  March  fiscal  period,
comprised  of  the  five  weeks  ended  March  26,  2006.  System-wide  domestic
comparable  sales increased 1.4 percent for the March period.  Comparable  sales
for domestic franchise  restaurants  increased 1.7 percent, and comparable sales
for company  restaurants  increased 0.2 percent,  reflecting a decrease in guest
traffic of  approximately  4.5 percent,  combined with a higher  average  check.
March comparable sales were positively impacted by approximately 1.0 percent due
to the  shift of  Easter  from the March  fiscal  period  last year to the April
fiscal period this year.

In addition,  the company reported comparable sales for the April fiscal period,
comprised of the four weeks ended April 23, 2006, which were negatively impacted
by approximately 1.0 percent due to the timing of Easter.  System-wide  domestic
comparable  sales decreased 0.1 percent for the April period,  while  comparable
sales for domestic franchise restaurants increased 0.4 percent. Comparable sales
for company  restaurants  decreased 1.7 percent,  reflecting a decrease in guest
traffic of approximately 6.5 percent, combined with a higher average check.

                                    - more -


<PAGE>


April 26, 2006
Page 2


System-wide  domestic comparable sales for the year-to-date period through April
have increased 2.0 percent,  with domestic franchise restaurant comparable sales
up 2.5 percent and company comparable restaurant sales up 0.5 percent.

Lloyd Hill,  chairman and chief  executive  officer,  said,  "Our  first-quarter
results,  while not consistent with our long-term goals,  were generally in line
with our expectations.  We did not expect to see significant  improvement in our
results early in the year because the majority of our key  initiatives  for 2006
are just now rolling out. We are optimistic that our future results will benefit
from the  implementation  of  these  initiatives  and  remain  committed  to our
long-term strategies, including our emphasis on disciplined growth and enhancing
shareholder value."

Dave Goebel,  president and chief  operating  officer,  added,  "Two of our most
important  initiatives  for the year are more rapid  innovation  of our food and
evolution of our  advertising  message.  I am delighted  with the new menu items
that we  introduced  nationwide  this  week  with the  start  of our  Steakhouse
Inspirations  promotion and our spring menu. While we promise never to sacrifice
quality for  speed-to-market,  our expanded culinary team is working overtime to
bring our guests more  relevant,  exciting food. I believe the work we are doing
now on menu,  advertising and brand  differentiation is laying the foundation to
drive  long-term  results,   even  if  the  challenging   consumer   environment
continues."

Other results for the first quarter ended March 26, 2006 included:

     o    Total  system-wide sales for the quarter increased by 9.9 percent over
          the prior year.  System-wide  sales are a non-GAAP  financial  measure
          that  includes   sales  at  all  company  and   franchise   Applebee's
          restaurants,  as reported by  franchisees.  The company  believes that
          system-wide sales information is useful in analyzing Applebee's market
          share and growth, and because franchisees pay royalties and contribute
          to the national advertising pool based on a percentage of their sales.

     o    Applebee's  ended the quarter with 1,829  restaurants open system-wide
          (497  company  and  1,332  franchise  restaurants).  During  the first
          quarter  of 2006,  there  were 29 new  Applebee's  restaurants  opened
          system-wide, including 9 company and 20 franchised restaurants.

     o    The company  repurchased  218,200  shares of common stock in the first
          quarter at an average  price of $23.70 for an  aggregate  cost of $5.2
          million.  As of March 26, 2006, $123.8 million remains available under
          the company's current stock repurchase authorization.

     o    As of March 26, 2006, the company had total debt outstanding of $207.8
          million,  with $31.2  million  available  under its  revolving  credit
          facility.

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<PAGE>


April 26, 2006
Page 3


BUSINESS OUTLOOK

The company  updated its guidance  with respect to its business  outlook for the
remainder of fiscal year 2006:

     o    Over 120 new  restaurants  are  expected  to open in  2006,  including
          approximately  40  company  restaurants  and  at  least  80  franchise
          restaurants.   Approximately  20  company  restaurants  are  currently
          expected  to open in the  first  half of the  year,  with the  balance
          opening in the second  half of the year.  Approximately  40  franchise
          restaurants  are expected to open in the first half of the year,  with
          the remainder opening in the second half of the year.

     o    System-wide  comparable  sales  are  expected  to  increase  by 2 to 3
          percent for the full year,  with  results  expected to be lower during
          the first part of the year and accelerate throughout the year.

     o    Overall  restaurant  margins before  pre-opening  expense for the full
          year of 2006 are  expected to be similar to fiscal  year 2005  results
          and will be  dependent  on  comparable  sales  performance  at company
          restaurants. Higher energy costs, including utilities, fuel surcharges
          and  packaging  costs,  are  expected  to  continue to have a negative
          impact on margins.

     o    General and  administrative  expenses,  as a  percentage  of operating
          revenues,  are  expected  to be in the  low-to-mid  10 percent  range,
          including the impact of stock-based compensation.

     o    The effective income tax rate is now expected to be approximately 35.0
          percent for the  remainder of the year,  resulting in a full year rate
          of between 34.5 and 35.0 percent.  This rate is lower than  previously
          expected due to higher hourly employment tax credits.

     o    Excluding the cost of franchise acquisitions, capital expenditures are
          expected to be between $140 and $150 million in 2006,  including costs
          relating  to the  construction  of a new  corporate  headquarters.  In
          addition,  the company  completed the  acquisition  of four  franchise
          restaurants in the Houston area in late January for approximately $8.2
          million in consideration.

     o    The incremental impact of stock-based  compensation  expense resulting
          from the implementation of Statement of Financial Accounting Standards
          No. 123R,  "Share-Based  Payment,"  is  estimated to be  approximately
          $0.17  per  diluted  share  for  the  year,  with  a  slightly  higher
          proportion recognized in the first quarter.

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<PAGE>


April 26, 2006
Page 4

     o    Based on the  foregoing  assumptions,  diluted  earnings per share for
          fiscal year 2006  excluding  impairment  charges are expected to be in
          the  range of $1.26 to $1.30,  including  the  impact  of  stock-based
          compensation expense.

A  conference  call to review the first  quarter  2006  results  and the current
business outlook will be held on Thursday morning, April 27, 2006, at 10:00 a.m.
Central Time (11:00 a.m.  Eastern Time).  The conference  call will be broadcast
live over the Internet and a replay will be available  shortly after the call on
the Investors section of the company's website (www.applebees.com).

Applebee's International,  Inc., headquartered in Overland Park, Kan., develops,
franchises and operates  restaurants under the Applebee's  Neighborhood  Grill &
Bar brand, the largest casual dining concept in the world. As of April 23, 2006,
there were 1,839 Applebee's  restaurants  operating system-wide in 49 states and
16 international  countries.  Additional information on Applebee's International
can be found at the company's website (www.applebees.com).

Certain  statements  contained  in this  release,  including  fiscal  year  2006
guidance as set forth in the Business Outlook section,  are  forward-looking and
based on current  expectations.  There are several risks and uncertainties  that
could cause actual results to differ materially from those described,  including
but not limited to the ability of the  company and its  franchisees  to open and
operate  additional  restaurants  profitably,  the ability of its franchisees to
obtain  financing,  the continued growth of its franchisees,  and its ability to
attract and retain qualified  franchisees,  the impact of intense competition in
the casual dining segment of the restaurant industry, and its ability to control
restaurant  operating costs which are impacted by market  changes,  minimum wage
and other employment laws, food costs and inflation.  For additional  discussion
of the  principal  factors  that could  cause  actual  results to be  materially
different, the reader is referred to the company's Form 10-K for the fiscal year
ended  December 25, 2005.  The company  disclaims any obligation to update these
forward-looking statements.


                                      # # #


<PAGE>

<TABLE>
<CAPTION>
                 APPLEBEE'S INTERNATIONAL, INC. AND SUBSIDIARIES
                       CONSOLIDATED STATEMENTS OF EARNINGS
                                   (Unaudited)
                    (in thousands, except per share amounts)

                                                                           13 Weeks Ended
                                                                  -------------------------------
                                                                    March 26,          March 27,
                                                                      2006               2005
                                                                  -------------     -------------
<S>                                                               <C>               <C>
Operating revenues:
     Company restaurant sales................................       $ 307,899         $ 270,458
     Franchise royalties and fees............................          35,935            33,008
     Other franchise income..................................             445             1,065
                                                                  -------------     -------------
        Total operating revenues.............................         344,279           304,531
                                                                  -------------     -------------
Cost of company restaurant sales:
     Food and beverage.......................................          82,236            71,635
     Labor...................................................         101,031            88,724
     Direct and occupancy....................................          78,946            66,367
     Pre-opening expense.....................................             750             1,167
                                                                  -------------     -------------
        Total cost of company restaurant sales...............         262,963           227,893
                                                                  -------------     -------------
Cost of other franchise income(a)............................             766               819
General and administrative expenses..........................          35,606            26,946
Amortization of intangible assets............................             204               228
Impairment and other restaurant closure costs................           1,600                --
Loss on disposition of property and equipment................             577               297
                                                                  -------------     -------------
Operating earnings...........................................          42,563            48,348
                                                                  -------------     -------------
Other income (expense):
     Investment income (expense).............................             745               (41)
     Interest expense........................................          (2,554)             (337)
     Other income............................................             136               435
                                                                  -------------     -------------
        Total other income (expense).........................          (1,673)               57
                                                                  -------------     -------------
Earnings before income taxes.................................          40,890            48,405
Income taxes(b)..............................................          13,739            16,748
                                                                  -------------     -------------
Net earnings.................................................       $  27,151         $  31,657
                                                                  =============     =============

Basic net earnings per common share..........................       $    0.37         $    0.39
                                                                  =============     =============
Diluted net earnings per common share........................       $    0.36         $    0.38
                                                                  =============     =============

Basic weighted average shares outstanding....................          74,147            80,705
                                                                  =============     =============
Diluted weighted average shares outstanding..................          75,281            82,375
                                                                  =============     =============


<FN>
(a)  The  company  recorded an expense of $0.5  million in the first  quarter of
     2006 to  increase  reserves  for  estimated  insurance  losses  incurred by
     franchise  participants of its captive insurance subsidiary that may not be
     recovered.
(b)  The effective income tax rate is currently  expected to be between 34.5 and
     35.0 percent for the full year.  The first  quarter tax rate was lower than
     the expected full year rate due to the resolution of a state tax matter and
     higher hourly employment tax credits.
</FN>
</TABLE>


<PAGE>



                 APPLEBEE'S INTERNATIONAL, INC. AND SUBSIDIARIES
             RECONCILIATION OF NON-GAAP MEASUREMENTS TO GAAP RESULTS
                                   (Unaudited)
                    (in thousands, except per share amounts)

In addition  to the  results  provided in  accordance  with  Generally  Accepted
Accounting  Principles  ("GAAP")  throughout  this  document,  the  company  has
provided non-GAAP measurements which present operating results on a basis before
impairment  and other  restaurant  closure costs and  stock-based  compensation.
Impairment  and other  restaurant  closure costs  reflect the  write-down of the
carrying  value of the property and equipment of two  restaurants  and remaining
expense  related to lease  obligations  for two stores  that were  closed in the
first quarter.

The company  adopted  the fair value  recognition  provisions  of  Statement  of
Financial Accounting Standards No. 123R,  "Share-Based Payment" ("SFAS 123R") at
the  beginning  of  fiscal  year  2006.   SFAS  123R  requires  all  stock-based
compensation,  including  grants of employee stock options,  to be recognized in
the  statement  of  earnings  based on fair  value.  The  company  adopted  this
accounting treatment using the modified prospective transition method; therefore
results for prior periods have not been restated.  Prior to the adoption of SFAS
123R, the company  accounted for  stock-based  compensation  using the intrinsic
value method  prescribed in Accounting  Principles Board ("APB") Opinion No. 25,
"Accounting for Stock Issued to Employees," and related interpretations.

The company is using earnings  before  impairment and other  restaurant  closure
costs and stock-based  compensation  as a key performance  measure of results of
operations for purposes of evaluating performance  internally.  In addition, the
company's  internal  reporting and budgeting,  as well as the calculation of its
incentive compensation payments,  includes the use of reported amounts excluding
stock-based  compensation.  This non-GAAP measurement is not intended to replace
the presentation of our financial results in accordance with GAAP.  Rather,  the
company believes that the  presentation of earnings before  impairment and other
restaurant  closure  costs  and  stock-based  compensation  provides  additional
information to facilitate the comparison of past and present operations.

<PAGE>

<TABLE>
<CAPTION>
                                                                             13 Weeks Ended
                                                                     ------------------------------
                                                                        March 26,        March 27,
                                                                          2006             2005
                                                                     -------------    -------------
<S>                                                                  <C>              <C>
Impairment and other restaurant closure costs....................     $  (1,600)       $      --
Stock-based compensation(a)......................................        (6,165)            (496)
Income taxes.....................................................         2,726              172
                                                                     -------------    -------------
  Impairment and other restaurant closure costs and
     stock-based compensation, net of tax........................     $  (5,039)       $    (324)
                                                                     =============    =============

Diluted weighted average shares outstanding......................        75,281           82,375
                                                                     =============    =============

Diluted earnings per share impact of impairment and other
  restaurant closure costs and stock-based compensation..........     $   (0.07)       $      --
                                                                     =============    =============

Reconciliation of earnings before impairment and other
  restaurant closure costs and stock-based compensation
  to net earnings:
     Earnings before impairment and other restaurant closure
        costs and stock-based compensation.......................     $  32,190        $  31,981
     Impairment and other restaurant closure costs and
        stock-based compensation, net of tax.....................        (5,039)            (324)
                                                                     -------------    -------------
        Net earnings.............................................     $  27,151        $  31,657
                                                                     =============    =============

Reconciliation of earnings per share before impairment and
  other restaurant closure costs and stock-based
  compensation to reported earnings per share:
     Diluted earnings per share before impairment and other
        restaurant closure costs and stock-based compensation....     $    0.43        $    0.39
     Diluted earnings per share impact of impairment and other
        restaurant closure costs and stock-based compensation....         (0.07)              --
                                                                     -------------    -------------
        Reported diluted earnings per share......................     $    0.36        $    0.38
                                                                     =============    =============

<FN>
(a)  Stock-based  compensation  for the first  quarter of 2006  includes $244 in
     cost of company  restaurant sales and $5,921 in general and  administrative
     expenses. Stock-based compensation for the first quarter of 2005 represents
     restricted  stock  expense  which was  included  entirely  in  general  and
     administrative expenses.
</FN>
</TABLE>



<PAGE>


The following table contains information derived from the company's consolidated
statements of earnings  expressed as a percentage of total  operating  revenues,
except where otherwise noted. Percentages may not add due to rounding.

<TABLE>
<CAPTION>

                                                                            13 Weeks Ended
                                                                   ---------------------------------
                                                                     March 26,          March 27,
                                                                        2006              2005
                                                                   ---------------   ---------------
<S>                                                                <C>               <C>
Operating revenues:
     Company restaurant sales....................................        89.4%             88.8%
     Franchise royalties and fees................................        10.4              10.8
     Other franchise income......................................         0.1               0.3
                                                                   ---------------   ---------------
        Total operating revenues.................................       100.0%            100.0%
                                                                   ===============   ===============
Cost of sales (as a percentage of company restaurant sales):
     Food and beverage...........................................        26.7%             26.5%
     Labor.......................................................        32.8              32.8
     Direct and occupancy........................................        25.6              24.5
     Pre-opening expense.........................................         0.2               0.4
                                                                   ---------------   ---------------
        Total cost of sales......................................        85.4%             84.3%
                                                                   ===============   ===============

Cost of other franchise income (as a percentage of other
     franchise income)...........................................       172.1%             76.9%
General and administrative expenses..............................        10.3               8.8
Amortization of intangible assets................................         0.1               0.1
Impairment and other restaurant closure costs....................         0.5                --
Loss on disposition of property and equipment....................         0.2               0.1
                                                                   ---------------   ---------------
Operating earnings...............................................        12.4              15.9
                                                                   ---------------   ---------------
Other income (expense):
     Investment income...........................................         0.2                --
     Interest expense............................................        (0.7)             (0.1)
     Other income................................................          --               0.1
                                                                   ---------------   ---------------
        Total other income (expense).............................        (0.5)               --
                                                                   ---------------   ---------------
Earnings before income taxes.....................................        11.9              15.9
Income taxes.....................................................         4.0               5.5
                                                                   ---------------   ---------------
Net earnings.....................................................         7.9%             10.4%
                                                                   ===============   ===============

</TABLE>

<PAGE>


The  following  table  sets  forth  certain  financial   information  and  other
restaurant data relating to company and franchise restaurants, as reported to us
by franchisees:

<TABLE>
<CAPTION>
                                                                            13 Weeks Ended
                                                                   ---------------------------------
                                                                      March 26,         March 27,
                                                                        2006              2005
                                                                   ---------------   ---------------
<S>                                                                <C>               <C>
Number of restaurants:
     Company:
         Beginning of period.....................................           486               424
         Restaurant openings.....................................             9                13
         Restaurant closings.....................................            (2)               --
         Restaurants acquired from franchisees...................             4                --
                                                                   ---------------   ---------------
         End of period...........................................           497               437
                                                                   ---------------   ---------------
     Franchise:
         Beginning of period.....................................         1,318             1,247
         Restaurant openings.....................................            20                13
         Restaurant closings.....................................            (2)               (3)
         Restaurants acquired from franchisees...................            (4)               --
                                                                   ---------------   ---------------
         End of period...........................................         1,332             1,257
                                                                   ---------------   ---------------
     Total:
         Beginning of period.....................................         1,804             1,671
         Restaurant openings.....................................            29                26
         Restaurant closings.....................................            (4)               (3)
                                                                   ---------------   ---------------
         End of period...........................................         1,829             1,694
                                                                   ===============   ===============
Weighted average weekly sales per restaurant:
         Company.................................................   $    48,087       $    48,193
         Domestic franchise......................................   $    53,622       $    51,973
         Domestic total..........................................   $    52,055       $    50,969
Change in comparable restaurant sales:(1)
         Company.................................................          1.2%              0.3%
         Domestic franchise......................................          3.1%              4.8%
         Domestic total..........................................          2.6%              3.7%
Total operating revenues (in thousands):
         Company restaurant sales................................   $   307,899       $   270,458
         Franchise royalties and fees(2).........................        35,935            33,008
         Other franchise income(3)...............................           445             1,065
                                                                   ---------------   ---------------
         Total...................................................   $   344,279       $   304,531
                                                                   ===============   ===============


<FN>
     (1)  When computing comparable  restaurant sales, domestic restaurants open
          for at least 18 months are compared from period to period.
     (2)  Franchise  royalties are generally 4% of each  franchise  restaurant's
          reported  monthly gross sales.  Reported  franchise  sales  (including
          international  restaurants),  in thousands, were $904,644 and $832,997
          in the 2006 quarter and the 2005 quarter, respectively. Franchise fees
          typically range from $30,000 to $35,000 for each restaurant opened.
     (3)  Other franchise income includes  revenue from  information  technology
          products and services  provided to certain  franchisees.  In addition,
          the  2005  period   includes   insurance   premiums  from   franchisee
          participation in our captive insurance program.
</FN>
</TABLE>

<PAGE>

<TABLE>
<CAPTION>

                 APPLEBEE'S INTERNATIONAL, INC. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                                   (Unaudited)
                      (in thousands, except share amounts)


                                                                                         March 26,        December 25,
                                                                                           2006               2005
                                                                                      --------------     -------------
                                     ASSETS
<S>                                                                                   <C>                <C>
Current assets:
     Cash and cash equivalents...................................................      $    7,451         $   13,040
     Short-term investments, at market value.....................................             287                286
     Receivables, net of allowance...............................................          37,136             37,857
     Receivables related to captive insurance subsidiary.........................           1,403              1,712
     Inventories.................................................................          15,327             20,373
     Prepaid income taxes........................................................              54              3,488
     Prepaid and other current assets............................................          18,694             13,518
                                                                                      --------------     -------------
        Total current assets.....................................................          80,352             90,274
Property and equipment, net......................................................         607,668            590,593
Goodwill.........................................................................         139,111            138,443
Restricted assets related to captive insurance subsidiary........................          19,115             19,329
Other intangible assets, net.....................................................           7,988              8,050
Other assets, net................................................................          33,896             31,899
                                                                                      --------------     -------------
                                                                                       $  888,130         $  878,588
                                                                                      ==============     =============


                      LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
     Current portion of long-term debt...........................................      $      278         $      259
     Notes payable...............................................................              --              7,900
     Accounts payable............................................................          49,243             63,445
     Accrued expenses and other current liabilities..............................          80,070            100,995
     Loss reserve and unearned premiums related to captive insurance subsidiary..           8,870             10,235
     Accrued dividends...........................................................              --             14,840
     Accrued income taxes........................................................           4,190                 --
                                                                                      --------------     -------------
        Total current liabilities................................................         142,651            197,674
                                                                                      --------------     -------------
Non-current liabilities:
     Long-term debt, less current portion........................................         207,534            180,208
     Deferred income taxes.......................................................          36,369             37,722
     Other non-current liabilities...............................................          53,041             50,374
                                                                                      --------------     -------------
        Total non-current liabilities............................................         296,944            268,304
                                                                                      --------------     -------------
        Total liabilities........................................................         439,595            465,978
                                                                                      --------------     -------------
Stockholders' equity:
     Preferred stock - par value $0.01 per share: authorized - 1,000,000 shares;
        no shares issued.........................................................              --                 --
     Common stock - par value $0.01 per share: authorized - 125,000,000 shares;
        issued - 108,503,243 shares..............................................           1,085              1,085
     Additional paid-in capital..................................................         242,049            234,988
     Unearned compensation.......................................................              --             (2,614)
     Retained earnings...........................................................         737,428            710,277
                                                                                      --------------     -------------
                                                                                          980,562            943,736
     Treasury stock - 34,041,590 shares in 2006 and 34,304,693 shares in 2005,
       at cost...................................................................        (532,027)          (531,126)
                                                                                      --------------     -------------
      Total stockholders' equity.................................................         448,535            412,610
                                                                                      --------------     -------------
                                                                                       $  888,130         $  878,588
                                                                                      ==============     =============

</TABLE>



<PAGE>

<TABLE>
<CAPTION>
                 APPLEBEE'S INTERNATIONAL, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (Unaudited)
                                 (in thousands)


                                                                                     13 Weeks Ended
                                                                             --------------------------------
                                                                               March 26,          March 27,
                                                                                 2006               2005
                                                                             -------------     --------------
<S>                                                                          <C>               <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
     Net earnings.......................................................       $  27,151         $  31,657
     Adjustments to reconcile net earnings to net
        cash provided by operating activities:
        Depreciation and amortization...................................          15,361            12,531
        Amortization of intangible assets...............................             204               228
        Stock-based compensation........................................           6,165               496
        Other amortization..............................................              45                63
        Deferred income tax provision...................................           1,278             1,659
        Impairment and other restaurant closure costs...................           1,600                --
        Loss on disposition of property and equipment...................             577               297
        Income tax benefit from stock-based compensation................           1,005             2,638
     Changes in assets and liabilities (exclusive of effects of
          acquisitions):
        Receivables.....................................................             718            (4,560)
        Receivables related to captive insurance subsidiary.............             309            (1,597)
        Inventories.....................................................           5,104             7,181
        Income taxes....................................................           7,624            12,917
        Prepaid and other current assets................................          (7,794)           (2,050)
        Accounts payable................................................          (9,750)           (8,019)
        Accrued expenses and other current liabilities..................         (21,146)           (5,887)
        Loss reserve and unearned premiums related to captive
          insurance subsidiary..........................................          (1,365)            3,031
        Other non-current liabilities...................................              23                 6
        Other ..........................................................            (191)             (282)
                                                                             -------------     --------------
        NET CASH PROVIDED BY OPERATING ACTIVITIES.......................          26,918            50,309
                                                                             -------------     --------------
CASH FLOWS FROM INVESTING ACTIVITIES:
     Purchases of property and equipment................................         (30,968)          (24,619)
     Restricted assets related to captive insurance subsidiary..........             214              (776)
     Acquisition of restaurants.........................................          (7,962)           (5,742)
                                                                             -------------     --------------
        NET CASH USED BY INVESTING ACTIVITIES...........................         (38,716)          (31,137)
                                                                             -------------     --------------
CASH FLOWS FROM FINANCING ACTIVITIES:
     Purchases of treasury stock........................................          (5,171)          (18,657)
     Dividends paid.....................................................         (14,840)           (4,867)
     Issuance of common stock upon exercise of stock options............           5,075             6,927
     Shares issued under employee benefit plans.........................           1,020             1,027
     Excess tax benefits from stock-based compensation..................             680                --
     Net debt proceeds (payments).......................................          19,445            (8,049)
                                                                             -------------     --------------
        NET CASH PROVIDED (USED) BY FINANCING ACTIVITIES................           6,209           (23,619)
                                                                             -------------     --------------
NET DECREASE IN CASH AND CASH EQUIVALENTS...............................          (5,589)           (4,447)
CASH AND CASH EQUIVALENTS, beginning of period..........................          13,040            10,642
                                                                             -------------     --------------
CASH AND CASH EQUIVALENTS, end of period................................       $   7,451         $   6,195
                                                                             =============     ==============

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