SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549

                                      Form 10-K
          (Mark One)

         X     ANNUAL  REPORT  PURSUANT  TO  SECTION 13  OR  15(d)  OF  THE 
               SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED]
          For the year ended: December 31, 1995
                                          OR

               TRANSITION REPORT  PURSUANT TO  SECTION 13  OR 15(d) OF  THE
               SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]

          Commission file number: 0-12802

                              El Chico Restaurants, Inc.
                (Exact name of registrant as specified in its charter)
                       Texas                           75-0982250
          (State or other jurisdiction of
          (I.R.S. Employer Identification No.)
          incorporation or organization)

             12200 Stemmons, Suite 100
                   Dallas, Texas                          75234
     (Address of principal executive offices)                         (Zip
          Code)
              Registrant's telephone number, including area code: (214)
          241-5500

             Securities Registered Pursuant to Section 12(b) of the Act:

                                         None

             Securities Registered Pursuant to Section 12(g) of the Act:
                             Common Stock, $.10 par value

               Indicate  by check mark whether the registrant (1) has filed
          all  reports required to be  filed by Section 13  or 15(d) of the
          Securities Exchange Act  of 1934 during  the preceding 12  months
          (or for such shorter period  that the registrant was required  to
          file  such reports),  and (2)  has  been subject  to such  filing
          requirements for the past 90 days.  Yes   x            No      
               The  aggregate market  value  of the  voting  stock held  by
          nonaffiliates  of  the   registrant  as  of  March  4,  1996  was
          $35,321,367.  As of that date, there were 4,095,231 shares of the
          registrant's Common Stock, par value $.10, outstanding.

                         DOCUMENTS INCORPORATED BY REFERENCE

               Portions  of the registrant's  definitive Proxy Statement to be 
          furnished  to  shareholders  in  connection  with  its Annual
          Meeting  of  Shareholders  to  be  held   on  May  2,  1996,  are
          incorporated by reference in Parts I and III of this Form 10-K.

               Indicate by  check mark if  disclosure of  delinquent filers
          pursuant to Item 405  of Regulation S-K is not  contained herein,
          and will not be contained, to the best of registrant's knowledge,
          in  definitive proxy  or information  statements  incorporated by
          reference in  Part III of this Form 10-K or any amendment to this
          Form 10-K.  
<PAGE>





                                        PART I

          ITEM 1.   BUSINESS.

               El  Chico Restaurants,  Inc. (generally  referred to  herein
          together with  its predecessor and subsidiaries  as the "Company"
          unless the context otherwise  requires) was incorporated in Texas
          in  1957 as a successor  to a restaurant  business operated since
          1940.     The  Company's   primary  business  is   operating  and
          franchising full-service, family-style restaurants under the name
          "El Chico" that  offer moderately priced,  high quality, Mexican-
          style  cuisine and alcoholic beverages.  As of December 31, 1995,
          a  total  of  101  restaurants  were  in  operation  in  Alabama,
          Arkansas, Florida, Georgia, Indiana, Kansas, Kentucky, Louisiana,
          Mississippi,  Missouri, Oklahoma, South  Carolina, Tennessee, and
          Texas, of which 72 were Company-operated and 29 were  franchised.
          Included in the 72  Company-owned restaurants were one restaurant
          under the name "Casa Rosa Restaurante", and two restaurants under
          the name "Cantina Laredo".   During 1995, the Company  opened six
          Company-owned   El  Chico  restaurants,  purchased  an  El  Chico
          restaurant from an existing franchisee, and opened one franchised
          El  Chico restaurant.  The  Company also is  engaged in designing
          and  supplying food-service equipment  through its  Pronto Design
          and Supply, Inc. subsidiary.

          El Chico Restaurants

               In  addition to  offering  Mexican-style  cuisine,  El Chico
          restaurants offer a limited  number of non-Mexican and children's
          items.  The Company continually evaluates and revises its menu to
          improve its products.

               The restaurants, which cater to families, are open daily for
          lunch and  dinner and  offer  entrees that  generally range  from
          $3.99 to $10.99.  Alcoholic beverages, which are served primarily
          with meals  (as opposed to bar  service), generated approximately
          8.0 percent of all restaurant revenues for 1995.

               The  average  El Chico  restaurant  seats  approximately 200
          people, and  the average  restaurant size is  approximately 5,600
          square feet.  The decor  generally features painted stucco walls,
          complementary furnishings, and a  bar area.  The exterior  of the
          freestanding    restaurants   reflects   a   style   of   Mexican
          architecture.   During 1992,  the Company  began  to remodel  the
          interiors and exteriors of virtually every Company-owned El Chico
          restaurant,  utilizing features  of  a newly  designed  prototype
          restaurant.  This remodel program was completed during 1993.  The
          Company  believes  that   periodic  remodels  are   important  to
          maintaining the competitiveness of its restaurants.  During 1995,
          the  Company began  to  remodel the  interiors  and exteriors  of
          certain  new  restaurants  opened  in 1993  and  1994,  including
          retrofitting of full-service bars, as well as further upgrades of
          older  restaurants.   The  Company anticipates  continuing  these
          remodeling programs in 1996 and thereafter.



                                         -1-
<PAGE>





               The  Company makes  centralized purchasing  arrangements for
          the  basic ingredients  of  its menu  items  in order  to  secure
          favorable prices and uniform quality specifications.  The Company
          currently  purchases  most  ingredients  and  supplies  through a
          single distributor under  a contract that may  be terminated upon
          12 months' written notice to its distributor.  In the event  that
          for any  reason the Company's primary distributor  ceases to meet
          the Company's  needs, the  Company does  not  anticipate that  it
          would  have significant  difficulty in  obtaining food  items and
          supplies at competitive prices from other sources.

               The  Company  utilizes  local  advertising   for  individual
          restaurants and broadcast advertising where market penetration is
          efficient  as  well  as  public  relations  activities  aimed  at
          individual  restaurants   and  entire  markets.    The  Company's
          advertising  campaigns  emphasize freshness,  quality  food, good
          service and value.  In 1995, the Company terminated its agreement
          with its  previous advertising agency  and began a  search, which
          was  completed  successfully in  early  1996, for  a  new agency.
          During  1995,  the Company's  expenditures  for advertising  were
          approximately 2 percent of Company-owned restaurant revenues.

          Franchised Restaurants

               Generally,   the  El Chico  restaurants  franchised  by  the
          Company  operate  for an  initial term  of  15 years,  require an
          initial franchise  fee of  $35,000, a  continuing royalty  fee of
          4 percent of the franchisee's gross revenues, and a marketing fee
          of 1 percent of such gross revenues.

               The  Company exercises  stringent qualification  criteria in
          selecting its franchisees.  Among  the criteria for selection are
          the  franchisee's  financial  strength,  successful   history  of
          restaurant business management,  and commitment to  the Company's
          high standards  of business  conduct.  The  Company's franchisees
          are required to comply with the Company's standards and operating
          guidelines.  The Company regularly reviews the performance of its
          franchisees to ensure such compliance.

          Specialty Restaurants

               As  of December 31, 1995, the Company owned and operated two
          types of  specialty restaurants consisting of  two Cantina Laredo
          restaurants and one Casa Rosa Restaurante.  The Company presently
          has no  plans to  develop additional specialty  restaurants under
          either existing or new  concepts, but it has been  presented with
          site opportunities for new  Cantina Laredo restaurants which have
          been considered  on  a case-by-case  basis  as would  other  such
          opportunities if presented in the future.

          New Restaurant Construction

               Management estimates  that the cost  of building, equipping,
          and  opening a  new freestanding  El Chico restaurant  will range
          from $1,425,000 to  $2,350,000, including approximately  $290,000


                                         -2-
<PAGE>





          to  $830,000 for  land,  approximately $600,000  to $760,000  for
          sitework,  construction,  and   landscaping,  and   approximately
          $535,000 to $760,000 for equipment, furniture, and opening costs.
          The  cost  of  developing  new  Company  restaurants  will  vary,
          primarily because  of varying  costs of land,  sitework, signage,
          pre-opening, and labor.

               During 1995, seven  Company-owned El Chico restaurants  were
          opened,  including one  El Chico  restaurant which  was purchased
          from  an existing franchisee.   By the  end of  1996, the Company
          expects to open two  to four additional El Chico  restaurants and

          remodel   eight   to  twelve   El  Chico   restaurants  including
          retrofitting  of full-service  bars  in  certain recently  opened
          restaurants without such features.

          Service Marks

               The Company has obtained federal registration of the service
          mark "El Chico", the El Chico  design, and other related  service
          marks.  The El Chico service mark is also currently registered in
          10 states.  These service marks are of material importance to the
          operation  of  the Company's  business.    The Company  has  also
          federally registered  service marks for "Casa  Rosa Restaurante",
          "Cantina  Laredo",    and  a  design  that  features  the  phrase
          "Cuellars' El Chico".


          Employees

               As of December 31, 1995, the Company employed  approximately
          3,900 persons (including full- and part-time personnel),  of whom
          3,800  were   restaurant  employees   and  100  were   restaurant
          supervision and corporate employees.  Company restaurants  employ
          an  average   of  approximately  50  to  60  full-  or  part-time
          employees.    None of  the  Company's  employees  are covered  by
          collective bargaining  agreements,  and  the  Company  has  never
          experienced a major work stoppage, strike, or labor dispute.  The
          Company considers its employee relations to be good.

          Competition

               The   restaurant  business   is   highly  competitive,   and
          competition   among  restaurants   serving  Mexican   cuisine  is
          increasing.  The Company believes  that the principal competitive
          factors in its  restaurant business are quality,  value, service,
          atmosphere, and location.  The Company's restaurants compete with
          many food service  operations in the vicinity of each restaurant,
          including restaurants specializing in Mexican  food.  The Company
          believes  that  its competitive  position  in certain  markets is
          enhanced  by  regional  name recognition  and  by  its moderately
          priced  menu,  quality  food,  and a  comfortable,  full-service,
          family-oriented  dining atmosphere.    Other companies,  however,
          continue  to   open   restaurants  similar   to   the   Company's



                                         -3-
<PAGE>





          restaurants,  and  certain  of  these  competitors  have  greater
          resources than the Company.

          Governmental Regulation

               The Company is subject to various federal,  state, and local
          laws  affecting   its  business.    Many   stringent  and  varied
          requirements of local governmental bodies with respect to zoning,
          land use,  and environmental  factors have  increased and  can be
          expected  to continue to  increase both the cost  of and the time
          required  for constructing new restaurants as well as the cost of
          operating  Company restaurants.   The  Company's restaurants  are
          subject to  various health, sanitation, and  safety standards and
          are also subject to state and local licensing and regulation with
          respect  to the service of  alcoholic beverages.   The service of
          alcoholic beverages  is material to the business  of the Company.
          The failure  to receive  or retain, or  a delay  in obtaining,  a
          liquor license  in a  particular location could  adversely affect
          the Company's operations in that location.   Liquor licenses must
          be  renewed  annually.    The  Company  has  not encountered  any
          significant problems relating to alcoholic  beverage licenses and
          permits to date.

               The Company may be subject in certain  states to "dram-shop"
          statutes, which  may establish liability  for improper  alcoholic
          beverage service.  The  Company carries liquor liability coverage
          as   part  of   its  existing  comprehensive   general  liability
          insurance.

               The Company is also subject to state and federal labor laws.
          These include the  Fair Labor Standards  Act, which governs  such
          matters as minimum wages, overtime, and other working conditions;
          the Immigration  and Naturalization  Act, which  governs employee
          citizenship  requirements;  and the  Americans  with Disabilities
          Act,  which governs  non-discriminating employment  practices and
          reasonable  accommodations for  disabled persons,  both employees
          and  customers.   A  significant  portion of  the  Company's food
          service personnel  are  paid  at  rates related  to  the  federal
          minimum  wage; and,  accordingly, increases  in the  minimum wage
          increase the Company's labor costs.  The Company has managed cost
          increases from  past minimum wage increases  by adjusting prices,
          adding and deleting menu items, and changing plate presentations,
          but the ability to manage future increases thusly would depend on
          the  size of  such increases,  their timing, and  the competitive
          environment.

               In  recent years  many states  have enacted  laws regulating
          franchise operations.  Much of this legislation requires detailed
          disclosure  in   the  offer  and  sale  of   franchises  and  the
          registration   of  the   franchisor  with   state  administrative

          agencies.     The  Company  is  also  subject  to  Federal  Trade
          Commission regulations relating to disclosure requirements in the
          sale of  franchises.  Additionally, certain  states have enacted,
          and others may  enact, legislation governing the  termination and


                                         -4-
<PAGE>





          non-renewal of  franchises  and other  aspects  of the  franchise
          relationship  that are  intended  to  protect franchisees.    The
          foregoing  matters  may  result  in  some  modifications  in  the
          Company's franchising activities  and some delays or  failures in

          enforcing certain of  its rights and  remedies under license  and
          lease agreements.   The  laws applicable to  franchise operations
          and  relationships are  developing  rapidly, and  the Company  is
          unable to  predict  the  effect on  its  intended  operations  of
          additional  requirements or restrictions  that may  be enacted or
          promulgated  or  of  court  decisions  that  may  be  adverse  to
          franchisors.

               Effective September 1, 1991, the Company elected to become a
          non-subscriber of the Texas Workers' Compensation Act.  Upon this
          election,  excess  liability  insurance  was  acquired,  and   an
          employee benefit trust was established to provide for benefits in

          the event of injury.  Indications are that this election has been
          favorable;  however,  the  Texas  Workers'  Compensation  Act has
          undergone  certain   favorable  reforms,  with   further  changes
          expected.  Management reviews this election periodically.


          ITEM 2.   PROPERTIES.

               As  of  December 31,  1995,  the  Company  owned 19  of  its
          restaurant  locations  and  leased  the  remaining  53 restaurant
          locations.  The  leases have terms  that expire between  1996 and

          2010, excluding  renewal options not  yet exercised, and  have an
          average remaining term  of approximately six  years.  The  leases
          generally provide for rentals ranging from 3 percent to 6 percent
          of gross restaurant sales, with  a stated minimum rental.   Under
          substantially all of  its leases, the Company is  required to pay
          real  estate   taxes,   insurance,  and   maintenance   expenses.
          Construction  is expected  to  begin in  March on  a  leased site
          replacing  an existing store in  Richardson, Texas and during the
          second quarter  on  a site  owned by  the  Company in  Lexington,
          Kentucky.

               Of the 72 restaurants operated by the Company as of December

          31, 1995,  53 were freestanding  buildings, nine were  located in
          strip shopping centers,  and 10 were  located in shopping  malls.
          As  of  the  same  date,  two  of  the  Company's  29  franchised
          restaurant  locations were owned by the Company and leased by the
          Company to  the franchisees, one  was leased  by the Company  and
          subleased to a  franchisee, and 26 were directly  leased or owned
          by the franchisees.

               As of March  4, 1996, the Company  owned four tracts of  raw
          land,  which are located  adjacent to  (i) an existing franchised
          location,   (ii) two open  and operating Company-owned locations,
          and  (iii) a closed Company-owned location.  In addition to these


                                         -5-
<PAGE>





          tracts, during 1995 the Company  purchased two separate tracts of
          land for  future development.  As  of the same  date, the Company
          owned  two parcels of  real estate, one  of which is  leased to a
          non-related business.  In addition, there are two  locations that

          are  leased   by  the  Company   and  subleased  to   non-related
          businesses.

               During  1993,  the Company  purchased  a 67,665  square foot
          office facility, where it  had been leasing approximately  20,000
          square  feet of space.   The Company  continues to office  in the
          facility  and  is leasing  the majority  of the  remaining square
          footage to unrelated businesses.  A 15,000  square foot warehouse
          is leased  which houses restaurant  equipment and  is located  in
          close proximity to the office facility.  The Company also  owns a
          tract of land  consisting of approximately one acre  and an 8,000
          square foot  building in  Carrollton, Texas.    This property  is

          utilized primarily for the training of restaurant management.


          ITEM 3.   LEGAL PROCEEDINGS.

               Although  the Company  is  a defendant  in various  lawsuits
          arising  out of  the  ordinary course  of  its business,  in  the
          opinion  of management, these  lawsuits will not  have a material
          adverse effect upon the Company's business or financial position.






























                                         -6-
<PAGE>





          ITEM 4.   SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

               No matters  were  submitted  to  a  vote  of  the  Company's
          shareholders during the fourth quarter of the year ended December
          31, 1995.

          Executive Officers of the Registrant

               As of March  4, 1996, the executive officers  of the Company
          were as follows:

          Name                     Age             Position with Company


          Joseph S. Thomson        66       Chairman of the Board

          Wallace A. Jones         44       President, Chief Executive 
                                            Officer and Director

          Lawrence E. White        45       Executive Vice President 
                                            and
                                            Chief Financial Officer

          John A. Cuellar          50       Senior Vice President, 
                                            Secretary,
                                            General Counsel, and Director

          Charles A. Cooper        44       Vice President, Development


          Gary R. Rustmann         42       Vice President, Operations

          Michael E. Sick          41       Vice President, Marketing

          Susan R. Holland         39       Treasurer, Controller


               The terms  of office and  biographical data with  respect to
          Messrs.  Joseph S.  Thomson, and Wallace  A. Jones,  as set forth
          under the heading "Election of Directors" in the definitive Proxy
          Statement  regarding the  Annual Meeting  of Shareholders  of the
          Company to  be held  on May 2,  1996, are incorporated  herein by
          reference.

               Lawrence E.  White  joined the  Company  as Chief  Financial

          Officer in May 1992.   During the  period from September 1994  to
          January  1995,  Mr. White  held  the  interim position  of  Chief
          Operating Officer in  addition to his  duties as Chief  Financial
          Officer.  From September 1989 to  April 1992, Mr. White served as
          Senior Vice President  and Treasurer  of Metromedia  Steakhouses,
          Inc., having  responsibility  for financial  management  of  both
          Ponderosa Steakhouses and Bonanza Family Restaurants as well as a
          meat-processing and food-distribution  subsidiary.  From February
          1987 to September  1989, Mr. White was employed  by TGI Friday's,


                                         -7-
<PAGE>





          Inc., where  he  served as  Director  of Financial  Planning  and
          Analysis, and  later served as  Treasurer.  Prior to  Mr. White's
          tenure at TGI Friday's, he  held financial positions at Lone Star
          Technologies, Inc., and at Ford Motor Company.

               John A. Cuellar has served as a director  and Vice President

          of the  Company since July 1974.   In December  1982, Mr. Cuellar
          also assumed  the positions of  General Counsel and  Secretary of
          the  Company.  In February  1993, Mr. Cuellar  was elected Senior
          Vice President.   In September 1994,  Mr. Cuellar was  elected as
          interim Chairman of  the Board, and served in that capacity until
          November 1994.  Mr. Cuellar serves on the Board of Link Financial
          Services  Corporation,  which  provides  financial  and  planning
          services to profit and nonprofit corporations and other entities.

               Charles  A.  Cooper  assumed his  present  position  as Vice
          President, Development in  February 1993.  Mr.  Cooper joined the
          Company  in April  1991 as Director  of Real Estate  and in April
          1992  assumed  responsibilities as  Director  of Franchising  and
          Development.   From  September  1988 to  April  1991, Mr.  Cooper
          served as Director  of Marketing with  S.W.S. Realty, Inc.   From
          December  1977  to  August 1988,  Mr.  Cooper  served in  various
          capacities including  President  of  National  Retail  Properties
          Corporation, a subsidiary of Southland Investment Properties.

               Gary  R.  Rustmann  joined the  Company  as  Vice President,
          Operations in January 1995.  From  December 1994 to January 1995,
          Mr. Rustmann  was employed with Brinker International,  Inc.  Mr.
          Rustmann was a restaurant owner from April 1994 to November 1994.
          From September 1982 to  April 1994, Mr. Rustmann was  employed by
          Brinker International,  Inc., his latest  position being Regional
          Vice President for  Midwest operations of the  Chili's restaurant
          concept.

               Michael  E. Sick  joined  the  Company  as  Vice  President,
          Marketing in February 1995.   From July 1994 until  January 1995,
          Mr. Sick served as Vice President of Marketing for Pearle Vision.
          From November 1986 to July 1994, Mr. Sick was employed by Jack in
          the Box  Restaurants, initially  as Director-Field  Marketing and
          Promotion and from  April 1991 as Vice  President-Field Marketing
          and Promotion.

               Susan  R.  Holland  joined  the  Company  as  Controller  in
          November  1985 and  has served  as Treasurer  since August  1990.
          From  December  1984  to  November 1985,  Ms.  Holland  was self-
          employed as a Certified  Public Accountant.  From August  1978 to
          December 1984, Ms. Holland was with Grant Thornton, with her last
          position being Audit Manager.








                                         -8-
<PAGE>





                                       PART II



          ITEM 5.   MARKET FOR  THE REGISTRANT'S  COMMON STOCK  AND RELATED
                    STOCKHOLDER MATTERS.

               The  Company's  common  stock  is  quoted  on  the  National
          Association  of  Securities  Dealers  Automated  Quotation System
          ("NASDAQ") National Market System  under the symbol "ELCH".   The
          following  table sets  forth  the high  and  low sale  prices  as
          reported on  the NASDAQ  National Market System  for the  periods
          indicated.


          Calendar Year 1995  High                     Low


          First Quarter       $    11.75               $     7.63
          Second Quarter      $     9.88               $     7.63
          Third Quarter       $    12.63               $    9.38
          Fourth Quarter      $    12.13               $    9.00


          Calendar Year 1994
          First Quarter       $    17.75               $    14.50
          Second Quarter      $    15.50               $    13.25
          Third Quarter       $    16.00               $    9.75
          Fourth Quarter      $    12.88               $    8.13


               To  date, the  Company has  not paid  any cash  dividends on
          shares of  common stock.  It is the general policy of the Company
          to retain earnings to support the Company's growth.

               On December 29,  1994 the Board of  Directors authorized the
          repurchase of up to  210,000 shares of the  Company's outstanding
          common stock in  the open market.  As of  March 15, 1995, 210,000
          shares had been purchased  at an average  price of $10.35, for  a
          total purchase of $2,173,975.

               Subsequently, on  February 15, 1996, the  Board of Directors
          authorized  the  repurchase  of  up  to  409,000  shares  of  the
          Company s  outstanding common stock from time to time in the open
          market.  As of March 4, 1996, there have been no shares purchased
          under this authorization.

               As of March  4, 1996, the  number of  record holders of  the
          Company's  common stock  was approximately  400, and  the Company
          estimates that as of that date there were 1,800 beneficial owners
          of its stock.






                                         -9-
<PAGE>





          ITEM 6.   SELECTED FINANCIAL DATA.

               The following  summary of  selected financial data  has been
          derived from the more detailed Consolidated Financial  Statements
          and  Notes thereto  of the  Company contained  elsewhere in  this
          report or previous reports.

<TABLE>
<CAPTION>
                                    Year
                                    Ended     Year
                                              Ended      Year
                                                         Ended   Transitio
                                                                     n
                                                                   Period
                                                                   Ended    Fiscal Year Ended


                                  December
                                     31,
                                    1995    December
                                               31,
                                              1994     December
                                                          31,
                                                         1993     December
                                                                    31,
                                                                  1992 (1)   June 1,
                                                                            1992 (3)  May 27,
                                                                                        1991

                                                 (In Thousands Except Per Share Amounts)

         Income Statement Information:
         <S>                      <C>       <C>        <C>       <C>       <C>        <C>  
         Revenues  . . . . . . .  $104,618   $97,826   $88,465    $51,257   $90,818   $84,465


         Income (loss) before
         income taxes  . . . . .  $5,592     $5,581    $4,339     $2,912 (2) $(1,568)(4)$1,870


         Net earnings (loss) . .  $3,958     $3,728    $2,713     $ 2,135(2) $ (969)   $1,242

         Net earnings (loss) per
         share . . . . . . . . .  $     
                                    0.98     $  0.88   $  0.64    $  0.49   $
                                                                              (0.22
                                                                                )     $     
                                                                                         0.28



         Balance Sheet
         Information:
         Total assets  . . . . .  $51,039    $43,964   $37,347    $31,730   $32,499   $32,338

         Long-term debt  . . . .  $8,435     $5,533    $3,303     $1,109    $1,215    $1,358
         Stockholders' equity  .  $32,497    $28,882   $24,844    $21,900   $22,679   $23,259
</TABLE>

          (1)   On November  6, 1992, the  Company changed its  fiscal year
                from  the  Monday  nearest  May 31  to  December  31.   See
                Management's Discussion and Analysis of Financial Condition
                and  Results of  Operations  for comparisons  to comparable
                periods.
           
          (2)   Includes a tax-free gain of  $847,000 on disposition of one
                of the Company's specialty restaurants. 

          (3)   Fiscal 1992 includes 53 weeks of operations.

          (4)   During fiscal 1992, the Company recorded  a pre-tax special
                charge  of  $3,977,000  to  provide  for:   write-downs  of
                underperforming   restaurants  and  other   properties  and
                assets,  higher than  expected insurance  costs,  and costs
                associated with personnel changes.


                                         -10-
<PAGE>






























































                                         -11-
<PAGE>





          ITEM 7.   MANAGEMENT'S  DISCUSSION  AND  ANALYSIS   OF  FINANCIAL
                    CONDITION AND RESULTS OF OPERATIONS.
           
          Results of Operations
           
               The  Consolidated Statements  of Operations  reported herein
          represent results of operations for the years ended December  31,
          1995, 1994, and 1993.  The following table summarizes key results
          of operations:

<TABLE>
<CAPTION>
                                              Year      Year       Year
                                             Ended      Ended     Ended
                                          December 31,December 31,December 31,
                                              1995          1994          1993     
                                                (Dollar Amounts in
                                                    Thousands)

               Number of Company-owned
               <S>                             <C>        <C>       <C>
               restaurants . . . . . . .       72         65        61

               Number of franchised
               restaurants . . . . . . .       29         29        29

               Weighted average annual
               sales per
                 Company-owned restaurant  $1,479     $ 1,60
                                                           0    $ 1,46
                                                                     9

               Revenues from Company
               operations  . . . . . . .   $104,8
                                               16     $ 97,8
                                                          26    $ 88,4
                                                                    65
               Net sales from Company
               operations  . . . . . . .   $101,6
                                               28     $ 94,9
                                                          01    $ 84,2
                                                                    09
               Income before taxes . . .   $5,592     $ 5,58
                                                           1    $ 4,33
                                                                     9
               Net income  . . . . . . .   $3,958     $ 3,72
                                                           8    $ 2,71
                                                                     3
               Profit margin . . . . . .     3.8%       3.8%      3.1%



          Comparative Performance 1995 vs 1994

               Net  sales  for  Company-owned  restaurants  increased   7.1
          percent to  $101,628,000 in 1995  from $94,901,000 in 1994.   The
          increase in sales is due to an  increase in the average number of
          stores operating throughout  1995 versus 1994.   Weighted average
          annual  sales per Company-owned  restaurant decreased 7.6 percent
          and same-store sales  decreased 2.2 percent including  a decrease
          in El Chico concept same-store sales of 2.5 percent.  As a result
          of mix changes and certain menu price increases associated with a
          new  menu  introduction,  the  Company s check-average  increased
          approximately 1.7  percent in 1995.  The Company has used a same-
          store sales convention  that reflects  new stores beginning  when
          they were opened for the full quarter of the prior year.  Because
          of  the  potentially significant  impact  of initially  high, but
          rapidly declining volumes after opening ( honeymoon effect )  the
          Company  will adopt a new convention in 1996 that adds new stores
          to the same-store  sales comparison in the quarter  in which they


                                         -12-
<PAGE>





          reach  their  18-month anniversary.    Seven  stores were  opened
          during 1995, including one purchased from an existing franchisee.

               Franchise revenue decreased from $2,093,000 to $2,082,000 as
          a result of  a decrease in the average number of stores operating
          throughout 1995 versus 1994.  This decrease  was partly offset by
          an increase in franchise same-store sales of 0.7 percent.  During
          1995,  the  Company  purchased  an  El  Chico  restaurant  from a
          franchisee and opened one new franchise store.

               Food  costs decreased  from 25.6  percent of  sales to  25.4
          percent  due to  a decrease  in  the cost  of beef,  avocados and
          beans.












































                                         -13-
<PAGE>





               Labor  costs remained  unchanged at  33.1 percent  of sales.
          Hourly labor cost  decreased as a percentage of sales as a result
          of eliminating the  restaurant cashier position by changing  to a
          server-banking  system,  and from  converting  certain restaurant
          employees  from  minimum  wage  to  tipped  compensation.    This
          decrease was  offset by  management  compensation expense,  which
          increased as  a percentage of sales as a result of lower weighted
          average sales per restaurant.

               Operating costs increased from 28.3 percent of sales to 28.6
          percent due to  an increase in  supplies, repair and  maintenance
          and  property  taxes  partly  offset  by  decreased  laundry  and
          insurance costs.  At the end of 1994,  the Company converted from
          cloth napkins to  paper napkins which resulted in reduced laundry
          costs, partly offset by an increase in supply costs.

               Pronto Design and Supply, Inc.  ( Pronto ) is a wholly owned
          subsidiary in the business of designing food-service kitchens and

          supplying the related equipment.   Equipment sales increased from
          $832,000  to  $908,000  primarily  reflecting   sales  to  a  new
          franchise restaurant.   Equipment  cost of  sales increased  as a
          percentage of  sales due to  a decrease  in vendor rebate  income
          relative  to sales.   Vendor  rebate income  includes rebates  on
          outside sales as well  as rebates on  equipment purchases for  El
          Chico restaurants.

               General and administrative  costs increased from  $8,967,000
          to  $9,227,000  as a  result  of  increased  employee  costs,  an
          increase in the  number of multi-unit restaurant  supervisors and
          increased training wages.   These increases were partly offset by

          decreased professional fees, incentive bonuses and travel.

               Interest  expense  increased   from  $146,000  to  $602,000,
          primarily as a result of increased borrowings, partly offset by a
          decline  in  interest  rates.    Interest income  decreased  from
          $88,000  to $78,000  due to  a decline  in average  invested cash
          balances.

               The income  tax provision decreased  as a percent  of income
          before taxes due  to an increase in the FICA tip credit and lower

          state taxes.

          Comparative Performance 1994 vs 1993

               Net  sales  for  Company-owned  restaurants  increased  12.7
          percent  to $94,901,000 in  1994 from  $84,209,000 in 1993.   The
          increase in sales is due to an increase in the average  number of
          stores  operating  throughout 1994  versus  1993, an  increase in
          weighted average annual sales per Company-owned restaurant of 8.9
          percent and  an increase in  same-store sales.   Same-store sales
          increased 3.8 percent  including an increase in  El Chico concept



                                         -14-
<PAGE>





          same-store sales of 4.3  percent.  Ten new stores were opened and
          six stores were closed during 1994.


               Franchised revenue  increased primarily  as a  result of  an
          improvement of same-store sales of 2.8 percent.

               Food costs  increased from  25.5  percent of  sales to  25.6
          percent of sales primarily as a result of increased produce costs
          experienced during the first quarter of 1994.

               Labor  costs increased from  33.0 percent  of sales  to 33.1
          percent  reflecting  increased  restaurant  management  incentive
          compensation partly offset by lower hourly labor.


               Operating costs increased from 28.0  percent to 28.3 percent
          of  sales as  a result  of  an increase  in deferred  pre-opening
          amortization  expense  and   an  increase   in  advertising   and
          promotional costs partially offset by  lower supply and insurance
          costs.

               Pronto sales  decreased from  $2,209,000 to $832,000  as the
          result of Pronto directing its  resources on El Chico  restaurant
          growth rather  than the development of outside  sales.  Equipment
          cost of sales decreased as the result  of lower outside sales and
          an increase in vendor rebate income relative to sales.

               General and administrative costs were basically unchanged at
          $8,967,000 in 1994 versus $8,957,000 in 1993.

               Interest   expense  increased  from   $75,000  to  $146,000,
          primarily as a  result of increased borrowings and interest rates
          partly offset by increased  capitalization of interest.  Interest
          income decreased  from $157,000 to  $88,000 due  to a decline  in
          average invested cash balances.

          Restaurant Closings

               The  loss  on  sale   or  disposition  of  assets  primarily
          represents the following: 1994    the write-down of  asset values
          for  two restaurants,  the loss  incurred on  the closing  of two
          restaurants and the gain realized  on the sale of one restaurant;
          1993    the loss on the  closing of two restaurants,  the gain on
          the  sale  of  land,  a   provision  for  the  closing  of  three
          restaurants and various asset  dispositions related to remodels. 
          As  of  December  31,  1995,  and  December  31,  1994,   accrued
          liabilities  and other  long-term liabilities  included $190,000,
          for future rent and other expenses related to store closings.

          Liquidity and Capital Resources


               The  Company  has  an   unsecured  credit  facility  with  a
          $16,000,000 commitment  comprised of a $15,000,000 revolving line
          of credit and a  $1,000,000 letter of credit facility.   The line

                                         -15-
<PAGE>





          of credit matures on December 31, 1997, and may be converted to a
          term loan, payable quarterly  on a 10-year amortization schedule,
          and maturing on December 31,  1999.  Both the line of  credit and
          the term loan bear interest at the Company's option of prime rate
          or  up to  six-month  LIBOR plus  0.75 percent.   Both  rates are
          subject  to maintaining certain financial covenants, and interest
          is payable upon maturity  of the LIBOR advances or  quarterly for
          prime  rate  advances.   In addition,  a  commitment fee  of 0.25
          percent  is payable quarterly on  any unused commitments.   As of
          December 31, 1995, $8,375,000  was outstanding under the  line of
          credit.  The credit facility was obtained for the funding  of the
          construction   of   new  Company-owned   restaurants,  remodeling
          existing   restaurants,  and   the  purchase  of   the  Company's
          headquarters facility  during 1993.   The  Company plans  to open
          approximately two to four El Chico restaurants  and remodel eight
          to twelve El Chico restaurants and estimates capital expenditures
          during 1996 to be  approximately $7,000,000 to $11,000,000, which
          will be  funded by  internal operations  and the  existing credit
          facility.    The  credit  facility  also  may  be  used  for  the
          repurchase   of   the  Company s   common   stock  with   certain
          limitations.     The  board  of  directors   has  authorized  the
          repurchase  of up to 409,000 shares of the Company s common stock
          from time-to-time in the open market.

               Working capital  decreased from  a deficit of  $4,006,000 at
          December  31, 1994  to a  deficit of  $4,696,000 at  December 31,
          1995,  primarily   as  a  result   of  an  increase   in  capital
          expenditures.   Cash flows generated  from operations of  new and
          existing  restaurants  and  borrowings  were  offset  by  capital
          expenditures.

               During 1995, certain menu prices were increased as part of a
          new menu  introduction  to  improve  merchandising  of  products.
          Additional  menu price  adjustments  to the  extent permitted  by
          competition  or changes  in menu  mix may  be required  to offset
          increased costs.





















                                         -16-
<PAGE>






          Accounting Matters
               
               In March 1995, the Financial Accounting Standards Board (the
           FASB ) issued  Statement of Financial  Accounting Standards  No.
          121,  Accounting for the Impairment  of Long-Lived Assets and for
          Long-Lived Assets to be  Disposed Of,  which requires  that long-
          lived assets and certain identifiable intangibles to be  held and
          used by an  entity be reviewed for impairment  whenever events or
          changes in circumstances indicate the carrying amount of an asset
          may not be recovered.   This Statement is effective for financial
          statements for  fiscal years  beginning after December  15, 1995.
          The  Company  does not  expect  that  its  adoption will  have  a
          material  effect   on  its  financial  position   or  results  of
          operations.

               In  October 1995,  the  FASB issued  Statement of  Financial
          Accounting  Standards   No.  123,   Accounting   for  Stock-Based
          Compensation,    which   establishes  financial   accounting  and
          reporting  standards for stock-based employee compensation plans.
          This  Statement is  effective  for transactions  entered into  in
          fiscal  years that begin  after December 15,  1995, with possible
          pro  forma disclosures  for awards granted  in fiscal  years that
          begin  after December  15,  1994.   The  Company will  adopt  the
          intrinsic  value based  method of  accounting for  employee stock
          based compensation.


          ITEM 8.   FINANCIAL STATEMENTS.

          The Financial  Statements are set forth herein commencing on page
          F-1.

























                                         -17-
<PAGE>





                                       PART III


          ITEM 9.   DISAGREEMENTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.

          Not applicable.


          ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE COMPANY.

          The  information  set  forth   under  the  heading  "Election  of
          Directors" contained in the definitive Proxy Statement  regarding
          the Annual Meeting  of Shareholders of the Company to  be held on
          May  2,  1996   (the  "Definitive  Proxy Statement")  sets  forth
          certain information with respect to the directors of the Company,
          some of  whom are also  executive officers,  and is  incorporated
          herein by  reference.   Certain information with  respect to  the
          remaining executive officers  of the Company  is set forth  under
          the caption "Executive Officers" in Part I of this Report.



          ITEM 11.  EXECUTIVE COMPENSATION.

            The  information  required  by  this  item  is  incorporated  by
          reference from the Definitive Proxy Statement.


          ITEM 12.  SECURITY  OWNERSHIP  OF CERTAIN  BENEFICIAL  OWNERS AND
                    MANAGEMENT.

            The  information  required  by  this  item  is  incorporated  by
          reference from the Definitive Proxy Statement.


          ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

            The  information  required  by  this  item  is  incorporated  by
          reference from the Definitive Proxy Statement.


                                       PART IV

          ITEM 14.  EXHIBITS, FINANCIAL STATEMENTS SCHEDULES AND REPORTS ON
                    FORM 10-K.

          (a)  The  following documents  are being  filed  as part  of this
          Annual Report on Form 10-K:

               1.  Financial  Statements:    The  Financial  Statements  are
                   listed in the Index  to Consolidated Financial Statements
                   on Page 16 of this Report.


               2.  Exhibits.


                                         -18-
<PAGE>





          Exhibit No.                        Exhibit

          3.1  Restated  Articles  of  Incorporation  of  the  Company,  as
          amended.

          3.2  Bylaws of the Company, as currently in effect.

          4.1* Specimen certificate evidencing Common Stock.

          4.1  Rights Agreement, dated February 9, 1995, by and between the
               Company and Society National Bank.

          4.2 Rights Agreement, dated  as of February 9, 1995  between the
               Company and Society National Bank, as Rights Agent.

          10.1                   Description of  Executive Short-Term Bonus
               Plan. (a) 

          10.2*               Incentive Stock Option Plan. (a)


          10.3**              Amendment to Stock Option Plan (formerly the                   Incentive Stock Option Plan). (a)


          10.4                Amendment No. 2 to Stock Option Plan. (a)

          10.5                Amendment No. 3 to Stock Option Plan. (a)

          10.6**              Form of Stock Option Agreement, as           
                              amended--Stock Option Plan. (a)

          10.7                Profit Sharing Plan and Trust Agreement. (a)

          10.8**              1986 Employee Stock Bonus Plan. (a)

          10.9**              Lease dated May 15, 1985, between the        
                              Company, as lessee, and Frank Cuellar and    
                              Sons, Inc., as lessor, as corrected February 
                              25, 1986, and amended July 18, 1986.

          10.10               Distribution Service Agreement dated March 3,
               1993, by and between The SYGMA Network and the Company.

          10.11***            Stock Option Plan for Non-employee Directors 
                              and Form of Stock Option Agreement. (a)

          10.12               1990 Long-Term Incentive Plan. (a)

          10.13               Nonemployee Director Stock Bonus Plan. (a)

          10.14               1992 Stock Option Plan. (a)

          10.15               Employment Agreement with Wallace A. Jones   
                              dated November 10, 1994. (a)



                                         -19-
<PAGE>





          11   Earnings Per Share Calculations.

          21   List of Subsidiaries.

          23   Consent of KPMG Peat Marwick LLP.

          27   Financial Data Schedule.

          *    Filed as an exhibit  to the Company's registration Statement
               on  Form S-1  (No.   2-83955) effective  June 30,  1983, and
               incorporated herein by reference.

          **   Filed  as an exhibit to the  Company's annual report on Form
               10-K   for  the  fiscal   year  ended  May   29,  1987,  and
               incorporated herein by reference.

          ***  Filed as  an exhibit to the Company's  annual report on Form
               10-K   for  the  fiscal   year  ended  May   30,  1988,  and
               incorporated herein by reference.

               Filed as an  exhibit to the Company's annual  report on Form
               10-K   for  the   fiscal  year   ended  May 28,   1990,  and
               incorporated herein by reference.

               Filed as  an  exhibit  to  the Company's  annual  report  on
               Form 10-K  for  the  fiscal  year ended  May 27,  1991,  and
               incorporated herein by reference.


               Filed as  an exhibit  to the  Company's quarterly  report on
               Form  10-Q  for  the  quarter  ended  August 19,  1991,  and
               incorporated herein by reference.

               Filed as  an exhibit to  the Company's transition  report on
               Form 10-K for the transition period ended December 31, 1992,
               and incorporated herein by reference.

               Filed as  an exhibit to the Company's  annual report on Form
               10-K  for the year ended December 31, 1993, and incorporated
               herein by reference.

               Incorporated by reference from the  Company's current report
               on Form 8-K filed on February 21, 1995.

              Incorporated  by reference  from the  Company's registration
               statement on Form 8-A  filed on February 21, 1995  (File No.
               0-12802).

          (a)  Compensation plan,  benefit plan  or employment contract  or
               arrangement.

               Filed  as an exhibit to the  Company s annual report on Form
               10-K for the  year ended December 31, 1994, and incorporated
               herein by reference.



                                         -20-
<PAGE>





               Incorporated by  reference from  Exhibit 1 of  the Company s
               Registration  Statement on  Form 8-A,  filed by  the Company
               with the Securities and  Exchange Commission on February 21,
               1995.





















































                                         -21-
<PAGE>





                     El Chico Restaurants, Inc. and Subsidiaries

                      INDEX TO CONSOLIDATED FINANCIAL STATEMENTS






          Page
          Consolidated Financial Statements:



             Independent Auditors  Report
          F-1


             Consolidated Balance Sheets at December 31, 1995 and 1994  F-2


             Consolidated Statements of Operations for the years ended
               December 31, 1995, 1994, and 1993
               F-3


             Consolidated Statements of Changes in Stockholders' Equity for
               the years ended December 31, 1995, 1994, and 1993        F-4


             Consolidated Statements of Cash Flows for the years ended
               December 31, 1995, 1994, and 1993
          F-5


             Notes to Consolidated Financial Statements
          F-6




















                                         -22-
<PAGE>





          All schedules have  been omitted as  the required information  is
          not  applicable, not required, or the  information is included in
          the consolidated financial statements or notes thereto.






















































                                         -23-
<PAGE>








                             INDEPENDENT AUDITORS' REPORT




          Board of Directors and Stockholders
          El Chico Restaurants, Inc.:



               We have audited the  consolidated financial statements of El
          Chico  Restaurants,  Inc.  and  subsidiaries  as  listed  in  the
          accompanying index.  These consolidated financial statements  are
          the   responsibility   of   the  Company's   management.      Our
          responsibility  is to  express an  opinion on  these consolidated
          financial statements based on our audits.

               We   conducted  our  audits  in  accordance  with  generally
          accepted  auditing standards.   Those  standards require  that we
          plan and perform the audit  to obtain reasonable assurance  about
          whether  the   financial   statements  are   free   of   material
          misstatement.   An audit  includes examining,  on  a test  basis,
          evidence supporting the amounts  and disclosures in the financial
          statements.   An  audit  also includes  assessing the  accounting
          principles used and significant  estimates made by management, as
          well as evaluating the overall  financial statement presentation.
          We believe  that our audits  provide a  reasonable basis for  our
          opinion.

               In  our  opinion,  the  consolidated   financial  statements
          referred to  above present fairly, in all  material respects, the
          financial position of El Chico Restaurants, Inc. and subsidiaries
          as  of  December 31,  1995  and 1994,  and  the results  of their
          operations  and their  cash flows  for each of  the years  in the
          three-year period   ended December  31, 1995, in  conformity with
          generally accepted accounting principles.




                                        KPMG Peat Marwick LLP



          Dallas, Texas
          February 7, 1996








                                         F-1
<PAGE>




</TABLE>
<TABLE>
<CAPTION>
                     El Chico Restaurants, Inc. and Subsidiaries

                             CONSOLIDATED BALANCE SHEETS
                     (In Thousands of Dollars, Expect Par Values)

                                                           December 31,
                                                         1995       1994

                  ASSETS

            CURRENT ASSETS:
              <S>                                      <C>       <C> 
              Cash and cash equivalents                $   266   $   727
              Accounts receivable                          979       852
              Income tax receivable                         66          
              Inventories                                1,100     1,189
              Prepaid expenses and other                 1,346     1,488
              Deferred income taxes (Note H)                71        56
                          Total current assets           3,828     4,312

            PROPERTY AND EQUIPMENT, NET (Note B)        46,209    38,559
            OTHER ASSETS AND DEFERRED COSTS              1,002     1,093
                          TOTAL ASSETS                 $51,039   $43,964


                  LIABILITIES AND STOCKHOLDERS' EQUITY

            CURRENT LIABILITIES:
              Current maturities of long-term debt (Note
            D)                                       $      25 $      22

              Trade accounts payable                     4,384     4,089
              Accrued liabilities (Note C)               4,115     4,034
              Income taxes payable                                   173
                          Total current liabilities      8,524     8,318

            LONG-TERM DEBT, less current maturities
            (Note D)                                     8,435     5,533

            OTHER LONG-TERM LIABILITIES                  1,240       926
            DEFERRED INCOME TAXES (Note H)                 343       305

            COMMITMENTS AND CONTINGENCIES (Note E)

            STOCKHOLDERS' EQUITY (Note F):
              Preferred stock - authorized 1,000,000
            shares
                of $.10 par value; none issued                          

              Common stock - authorized 10,000,000
            shares of $.10 par value;
                issued 4,746,975 and 4,743,640 shares in
            1995 and 1994, respectively                    475       474


              Additional paid-in capital                15,895    14,583
              Retained earnings                         21,938    17,980
              Unamortized value of restricted stock
            issued                                         (59)      (68)

                                                        38,249    32,969



                                         F-2
<PAGE>





               Less treasury stock - at cost 651,744 and
            615,263 shares in
                  1995 and 1994, respectively           (5,752)   (4,087)

                          Total stockholders' equity    32,497    28,882
                          TOTAL LIABILITIES AND
            STOCKHOLDERS' EQUITY                       $51,039   $43,964

</TABLE>
          The accompanying notes are an integral part of these consolidated
          financial statements.
















































                                         F-3
<PAGE>





                     El Chico Restaurants, Inc. and Subsidiaries

                        CONSOLIDATED STATEMENTS OF OPERATIONS
                 (In Thousands of Dollars, Except per Share Amounts)
<TABLE>
<CAPTION>


                                               Year Ended December 31,
                                               1995      1994      1993

            Revenues:
              Sales from Company-owned
           
            <S>                             <C>       <C>        <C>
            restaurants                     $ 101,62
                                                8     $94,901    $84,209

              Equipment sales                   908       832      2,209

              Franchise revenues              2,082     2,093      2,047
                                            104,618    97,826     88,465

            Costs and expenses:
              Restaurant cost of sales -
            food and beverage                25,772    24,273     21,515

              Restaurant cost of sales -
            labor                            33,637    31,435     27,819


              Restaurant operating expenses  29,084    26,881     23,577

              Cost of equipment sales           782       590      1,972

              General and administrative      9,227     8,967      8,957
              Loss on sale or disposition
            of assets (Note G)                             41        368


              Interest expense                  602       146         75
              Interest income                   (78)      (88)      (157)

                                             99,026    92,245     84,126
                        Income before
            income taxes                      5,592     5,581      4,339


            Income tax provision  (Note H)    1,634     1,853      1,626
                        NET EARNINGS        $ 3,958   $ 3,728    $ 2,713

            Net earnings per common share   $      
                                               0.98   $      
                                                         0.88    $      
                                                                   0.64

            Weighted average number of
            shares and share
              equivalents outstanding     4,046,489 4,260,292  4,253,555

            Fully diluted net earnings per
            common share                    $      
                                               0.98   $      
                                                         0.88    $      
                                                                   0.63






                                         F-4
<PAGE>





            Fully diluted weighted average
            number of
              shares and share equivalents
            outstanding                   4,055,028 4,260,499  4,321,398







</TABLE>

          The accompanying notes are an integral part of these consolidated
          financial statements.











































                                         F-5
<PAGE>



<TABLE>
<CAPTION>
                              El Chico Restaurants, Inc. and Subsidiaries

                      CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY

                                       (In Thousands of Dollars)


                                                                   Unamortized
                                                Additional           Value of
                                       Common Stock     Paid-InRetainedRestrictedTreasury
                                Shares            Amount   Capital   EarningsStock Issue  Stock  
       Total  

     Balances at December 31,
     <C>                      <C>         <C>   <C>       <C>          <C>    <C>      <C>
     1992                     4,686,308   $469  $13,970   $11,539      ($83)  ($3,995) $21,900


     Net earnings                                           2,713                        2,713
     Issuance of common stock
     under
       stock bonus plan, net                         77                 (16)      (12)      49

     Issuance of common stock
     pursuant
       to stock option plan      33,665      3      216                           (69)     150

     Amortization of restricted
     stock issue                                                         32                 32

     Balances at December 31,
     1993                     4,719,973    472   14,263    14,252       (67)   (4,076)  24,844



     Net earnings                                           3,728                        3,728
     Issuance of common stock
     under
      stock bonus plan, net                          71                 (57)      (11)       3

     Issuance of common stock
     pursuant
      to stock option plan       23,667      2      249                                    251

     Amortization of restricted
     stock issue                                                         56                 56

     Balances at December 31,
     1994                     4,743,640    474   14,583    17,980       (68)   (4,087)  28,882


     Net earnings                                           3,958                        3,958

     Purchase of treasury stock                                                (2,174)  (2,174)
     Issuance of common stock
     under
      stock bonus plan, net                          52                 (53)        9        8

     Issuance of common stock
     pursuant
      to stock option plan        3,335      1    1,260                           500    1,761

     Amortization of restricted
     stock issue                                                         62                 62

     Balances at December 31,
     1995                     4,746,975   $475  $15,895   $21,938      ($59)  ($5,752) $32,497




                                                 F-6
<PAGE>










</TABLE>



          The accompanying notes are an integral part of these consolidated
          financial statements.














































                                         F-7
<PAGE>


<TABLE>
<CAPTION>

                     El Chico Restaurants, Inc. and Subsidiaries

                        CONSOLIDATED STATEMENTS OF CASH FLOWS
                              (In Thousands of Dollars)

                                                  Year Ended December 31,
                                                   1995     1994     1993
          Cash flows from operating activities:
            <S>                                  <C>      <C>      <C>
            Net earnings                         $3,958   $3,728   $2,713
            Adjustments to reconcile net
          earnings to
              net cash provided by operating
          activities:
                 Depreciation and amortization
          of property and equipment               5,107    4,831    4,098



                 Amortization of deferred costs   1,333    1,257      273
                 Loss on sale or disposition of
          assets                                              41      368

                 Deferred income taxes               23      419      222
                 Increase in accounts receivable   (127)    (155)        
                 Decrease (increase) in income
          tax receivable                            (66)     792     (792)

                 Decrease (increase) in
          inventories                                89      120     (179)

                 Decrease (increase) in prepaid
          expenses and other                       (103)    (385)     399

                 Decrease (increase) in other
          assets and deferred costs              (1,242)  (1,133)    (894)

                 Increase (decrease in trade
          accounts payable and accrued
                     liabilities                    376     (353)   1,234

                 Increase (decrease) in income
          taxes payable                            (173)     173     (602)

                 Increase (decrease) in other
          long-term liabilities                     314      254     (232)

                 Other                              412      125        4
                   Net cash provided by
          operating activities                    9,901    9,714    6,612


          Cash flows from investing activities:
            Proceeds from sale of property and
          equipment                                        1,449      405

            Purchases of property and equipment (13,015) (13,784) (15,557)
                   Net cash used in investing
          activities                            (13,015) (12,335) (15,152)


          Cash flows from financing activities:
            Borrowings of long-term debt          2,925    2,250    3,200
            Repayment of long-term debt             (20)     (18)  (1,132)
            Purchase of treasury stock           (2,174)              (69)
            Proceeds from note receivable           245                  
            Issuance of common stock              1,677      273      296

                   Net    cash    provided    byfinancing activities2,6532,5052,295

                   NET DECREASE IN CASH            (461)    (116)  (6,245)

                                         F-8
<PAGE>






          Cash and cash equivalents at beginning
          of year                                   727      843    7,088

          Cash and cash equivalents at end of
          year                                   $  266   $  727   $  843


          Supplemental disclosures of cash flow
          information:
               Cash paid during the year for:
                 Interest (net of amount
          capitalized)                           $  551   $     
                                                              99   $     
                                                                       71


                 Income taxes                    $1,911   $1,010   $2,660

</TABLE>

          The accompanying notes are an integral part of these consolidated
          financial statements.








































                                         F-9
<PAGE>





                     El Chico Restaurants, Inc. and Subsidiaries

                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                          December 31, 1995, 1994, and 1993




          NOTE A - SUMMARY OF ACCOUNTING POLICIES

             A  summary of the significant  accounting policies  applied in
             the  preparation of  the  accompanying  consolidated financial
             statements follows:

             Principles of Consolidation

             The consolidated financial statements include the accounts  of
             El Chico Restaurants, Inc. and its subsidiaries (the Company).
             All  significant intercompany  accounts and  transactions have
             been eliminated.

             Inventories

             Inventories, which  consist primarily  of  food products,  are
             stated  at the lower  of cost  or market.  Cost  is determined
             using the first-in, first-out method.

             Property and Equipment

             Property and equipment are recorded at cost.  Depreciation and
             amortization are  provided in  amounts sufficient to  amortize
             the  cost  of  depreciable  assets to  operations  over  their
             estimated  service lives  of  three to  30 years.    Leasehold
             improvements are amortized  over the  lives of  the respective
             leases, including renewal periods when the  Company intends to
             exercise  renewal  options,  or  the  service  lives  of   the
             improvements, whichever is  shorter.  The straight-line method
             of depreciation is  followed for substantially  all assets for
             financial  reporting purposes,  while accelerated  methods are
             used for tax purposes.


             Interest  is   capitalized  with  the   construction  of   new
             restaurants  as  part  of  the  asset  to  which  it  relates.
             Interest  capitalized  during  1995,  1994 and  1993  was  not
             material.

             Preopening Costs

             Restaurant preopening  costs, comprised primarily  of the cost
             of  hiring and  training  restaurant employees,  are amortized
             over the initial twelve months of a restaurant's operations.

             Franchise Fee Revenue


                                         F-10
<PAGE>





             Franchise fee revenue is recognized when all material services
             or conditions  relating to  the sale  have been  substantially
             performed or satisfied by the Company, but no sooner  than the
             commencement  of  operations by  the  franchisee.    Franchise
             revenues  for  each  period  presented   in  the  consolidated
             statement of operations relate substantially to royalties paid
             by franchisees.

             Cash Equivalents

             The  Company  considers  all  highly  liquid  debt instruments
             purchased with an original maturity of three months or less to
             be cash equivalents.
                     El Chico Restaurants, Inc. and Subsidiaries

                NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED




          NOTE A - SUMMARY OF ACCOUNTING POLICIES - Continued

             Income Taxes

             The  Company accounts  for income  taxes using  the asset  and
             liability  method.   Under  the asset  and  liability  method,
             deferred  tax assets  and liabilities  are recognized  for the
             future  tax consequences  attributable to  differences between
             the financial  statement carrying  amounts of  existing assets
             and liabilities and their respective tax bases.  Deferred  tax
             assets and liabilities are  measured using  enacted tax  rates
             expected  to apply  to taxable  income in  the years  in which
             those temporary differences are  expected to  be recovered  or
             settled.  The effect on deferred tax assets and liabilities of
             a change in  tax rates is  recognized in income in the  period
             that includes the enactment date.

             Earnings Per Common Share

             Earnings per  common share is  based on  the weighted  average
             number  of  shares and  common  share equivalents  outstanding
             during each period determined using the treasury stock method.
             Primary common share equivalents  are determined based  on the
             average market price exceeding the exercise price of the stock
             options while fully diluted are determined based on the higher
             of  the  average  or  the  ending market  price  exceeding the
             exercise price of the stock options.

             Use of Estimates

             Management of the  Company has made a number of  estimates and
             assumptions relating to the reporting  of assets, liabilities,
             revenues and expenses and the  disclosure of contingent assets
             and  liabilities  to   prepare  these  consolidated  financial



                                         F-11
<PAGE>





             statements  in conformity  with generally  accepted accounting
             principles.  Actual results could differ from those estimates.


          NOTE B - PROPERTY AND EQUIPMENT

             Property and equipment consists of:
                                                   December 31,
                                                 1995        1994

                                                  (In Thousands)
                  Land                         $ 7,732    $ 6,079
                  Buildings and improvements    16,136     16,064
                  Leasehold improvements        27,878     23,753
                  Equipment, furniture and
                  fixtures                      17,871     23,800

                  Construction in progress         438        433
                                                70,055     70,129
                     Less accumulated
                  depreciation
                         and amortization      (23,846)   (31,570)

                                               $46,209    $38,559
                     El Chico Restaurants, Inc. and Subsidiaries

                NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED



          NOTE C - ACCRUED LIABILITIES

             Accrued liabilities consist of:

                                                     December 31,
                                                    1995      1994
                                                    (In Thousands)
                  Compensation and related taxes  $1,689    $1,849
                  Insurance claims and
                  administration                     750       805

                  Taxes, other than income and
                  payroll                            838       576

                  Rent                               353       349
                  Provision for restaurant closings   63        63
                  Other                              422       392
                                                  $4,115    $4,034


          NOTE D - LONG-TERM DEBT


             Long-term debt consists of:
                                                     December 31,
                                                     1995      1994
                                                    (In Thousands)
             Note payable to a bank under credit
             facility (see below)                  $8,375    $5,450



                                         F-12
<PAGE>





             Other                                     85       105

                                                    8,460     5,555
                Less current maturities               (25)      (22)
                                                   $8,435    $5,533


             The  existing   unsecured  credit   facility  consists  of   a
             $16,000,000  commitment comprised  of a  $15,000,000 revolving
             line  of credit and  a $1,000,000  letter of  credit facility.
             The line  of credit matures  on December 31,  1997, and may be
             converted  to  a term  loan,  payable quarterly  on a  10-year
             amortization  schedule,  and  maturing on  December  31, 1999.
             Both the line of credit and the term loan bear interest at the
             Company's  option of prime rate or up  to six-month LIBOR plus
             0.75 percent.  Interest is payable upon maturing  of the LIBOR
             advances or quarterly for  prime rate advances.  The  facility
             is  subject to  maintaining certain  financial covenants.   At
             December  31, 1995, $7,000,000 of the  amount outstanding bore
             interest at LIBOR plus 0.75 percent, or 6.625  percent and the
             remaining $1,375,000 outstanding  bore interest  at prime,  or
             8.0 percent.   In addition, an  annual commitment fee  of 0.25
             percent is payable  quarterly on  any unused commitment.   The
             carrying  amount of the credit  facility at  December 31, 1995
             and 1994 approximates the fair value since the borrowings bear
             interest at current market rates.































                                         F-13
<PAGE>





                     El Chico Restaurants, Inc. and Subsidiaries

                NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED



          NOTE D - LONG TERM DEBT - Continued

             Scheduled maturities of long-term debt as of December 31, 1995
             are as follows (in thousands):


                        Fiscal Year
                           1996                  $    25
                           1997                       25
                           1998                      864
                           1999                    7,546
                                                  $8,460


          NOTE E - COMMITMENTS AND CONTINGENCIES

             The  Company  leases   land,  buildings  and  equipment  under
             noncancellable  operating leases  expiring  at  various  dates
             through 2024.  The following  is a schedule of  minimum rental
             payments under such leases (in thousands):

                            1996               $ 3,312
                            1997                 3,281
                            1998                 2,667
                            1999                 2,580
                            2000                 2,057
                            Thereafter           8,745
                                               $22,642


             Most land and building lease agreements provide for contingent
             rentals based on sales.   Rental expense for all leases was as
             follows (in thousands):

                                      Year Ended December 31,
                                    1995       1994        1993
                   Minimum
                   rentals       $3,262      $2,805      $2,973

                   Contingent
                   rentals          510         645         853


                                 $3,772      $3,450      $3,826

            The Company is  a defendant in various lawsuits arising  in the
            ordinary course of  its business.  The majority of  these suits
            are covered by  insurance.  In the opinion of  management, none
            of  these  lawsuits   will  have  a  material  adverse  effect,
            individually or in  the aggregate, upon the Company's financial
            position or results of operations.


                                         F-14
<PAGE>





                     El Chico Restaurants, Inc. and Subsidiaries

                NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED



          NOTE F - STOCKHOLDERS' EQUITY

            The  Company has  incentive  stock  option plans  covering  key
            employees  and  a plan  covering  non-employee  directors  with
            857,000 shares and  100,000 shares reserved, respectively.   As
            of  December 31,  1995, options  covering  253,751 shares  were
            exercisable   at   prices  ranging   from   $3.16   to  $12.13.
            Transactions during 1995, 1994, and 1993 were as follows:


                                                 Option Price
                                         Shares      Per
                                                     Share       Total

                                                                    (In
                                                              thousands
                                                                      )

              Options outstanding at
              December 31, 1992         239,004     $3.16 -
                                                     9.56       $1,739

                Granted
                Exercised
                Forfeited               625,000
                                        (33,665)
                                         (4,669)     9.63
                                                     3.18 -
                                                     3.63
                                                     3.63     
                                                                 6,016
                                                                  (115)
                                                                   (17)



              Options outstanding at
              December 31, 1993         825,670      3.16 -
                                                     9.63        7,623


                Granted                 260,000      11.00 -
                                                     12.12       3,140

                Exercised               (23,667)     3.18 -
                                                     9.56         (184)

                Forfeited              (342,001)     3.63 -
                                                     9.625      (3,289)


              Options outstanding at
              December 31, 1994         720,002      3.16 -
                                                     12.13       7,290

                 Granted                 98,500      8.13 -
                                                     11.00       1,030

                 Exercised             (170,001)     3.18 -
                                                     9.63       (1,615)

                 Forfeited              (10,000)     11.00        (110)
              Options outstanding at
              December 31, 1995         638,501    $ 3.16 -
                                                     12.13      $6,595



            In February  1995, the Company s  Board of Directors adopted  a
            Shareholder  Rights Plan pursuant to which purchase rights (the


                                         F-15
<PAGE>





             Rights ) were issued  to holders of  its common  stock at  the
            rate of one Right  for each share of common stock.   The Rights
            will trade with  the Company s common stock  until exercisable.
            The  Rights became  exercisable ten  days after  any  person or
            group acquires 20 percent or more  of the Company s outstanding
            common stock  or announces  a tender  offer for  30 percent  or
            more  of the Company s  outstanding common  stock.   The Rights
            thereafter entitle  the holder to  purchase one  one-thousandth
            of a  share of Preferred  Stock for $48.00,  and, under certain
            circumstances, would be modified to  entitle certain holders to
            purchase  additional  Common  Stock of  the  Company  having  a
            market value  of two  times the  $48.00 exercise  price of  the
            Right,  or to  purchase common  stock of  an  acquiring company
            having a  market value of  two times the  $48.00 exercise price
            of the Right.  The Rights  expire on December 31, 2004 and  may
            be  redeemed  by the  Company  for  one  cent  per Right  under
            certain circumstances.

            On October 27,  1995, options were granted to  purchase 138,000
            shares at $10.00 per share, subject to  shareholder approval at
            the May 2, 1996 Shareholders Meeting.




































                                         F-16
<PAGE>





                     El Chico Restaurants, Inc. and Subsidiaries

                NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED



          NOTE G - LOSS ON SALE OR DISPOSITION OF ASSETS

            Management  reviews each restaurant regularly to determine that
            expected undiscounted  cash flows are  adequate to recover  the
            related investment.   When expected cash flows  are inadequate,
            the  Company writes  down the asset  to its  recoverable value.
            Asset  values for  two restaurants  were  written-down $220,000
            during  1994 as  future operations are  not expected to provide
            sufficient cash flow  to recover  the related investments.   In
            addition, during  1994,  the  Company closed  six  restaurants.
            One restaurant  was sold resulting in  a gain of  $439,000, one
            was closed at a  loss of $202,000, one was  closed with minimal
            costs and  the remaining  three closings  were provided  for in
            1993.  No restaurants were closed during 1995.



          NOTE H - INCOME TAXES

            The provision  for income taxes  consists of the following  (in
            thousands):

                                   Year Ended December 31,
                                1995         1994        1993
                  Federal:
                     Current  $1,536      $1,258       $1,124
                     Deferred     23         419          222
                  State           75         176          280
                              $1,634      $1,853       $1,626


            The  types  of  temporary  differences   between  the  tax  and
            financial reporting bases  of assets and liabilities  that give
            rise to the deferred income tax assets  (liabilities) and their
            related tax effects are as follows (in thousands):

                                                      December 31,
                                                     1995      1994
                 Deferred tax assets:
                    Insurance reserves               $362      $458
                    Provision for restaurant
                 closings                              65        65

                    Deferred compensation             125        64
                    Other                              12        23

                        Total deferred tax assets     564       610

                 Deferred tax liabilities:
                    Property and equipment           (747)     (585)


                                         F-17
<PAGE>





                    Restaurant preopening costs       (89)     (274)
                       Total deferred tax
                 liabilities                         (836)     (859)

                       Net deferred tax liability   ($272)    ($249)

                     El Chico Restaurants, Inc. and Subsidiaries

                NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED



          NOTE H - INCOME TAXES - Continued

            The Company believes that the  deferred tax assets at  December
            31,1995 and 1994 will be realized  based upon historical levels
            of income and  through reversals of existing  taxable temporary
            differences during the carryforward period.

            The  Company's  effective  income  tax  rate  differs  from the
            expected federal statutory  income tax rate as a result  of the
            following:


                                            Year Ended December 31,
                                           1995       1994       1993
               Expected income tax
               provision                   34.0%     34.0%      34.0%


               State income taxes           0.5       3.3        4.3
               FICA tip and TJTC tax
               credits                     (5.9)     (5.1)      (1.3)

               Other                        0.6       1.0        0.5
                  Income tax provision 
                                           29.2%     33.2%      37.5%























                                         F-18
<PAGE>





                                      SIGNATURES

              Pursuant  to the requirements  of Section 13  or 15(d) of the
          Securities Exchange Act  of 1934, the Registrant has  duly caused
          this report  to  be signed  on  its  behalf by  the  undersigned,
          thereunto duly authorized:

                                            EL CHICO RESTAURANTS, INC.


                                            By:/s/ Wallace A. Jones        
                       
                                                Wallace A. Jones,  President
          and
                                                Chief Executive Officer
          Date:  March 14, 1996


              Pursuant to  the requirements of the  Securities Exchange Act
          of 1934,  this  report has  been signed  below  by the  following
          persons on behalf  of the Registrant and in the capacities and on
          the dates indicated.

            Signature            Title                      Date

            /s/ Wallace A.
            Jones             
            Wallace A. Jones     President and Chief
                                 Executive Officer
                                 (Principal Executive       March 14,
                                                            1996


            /s/ Lawrence E.
            White             
            Lawrence E. White    Executive Vice President
                                 and Chief Financial
                                 Officer (Principal         March 14,
                                                            1996


            /s/ John A.
            Cuellar           
            John A. Cuellar      Senior Vice President,
                                 Secretary, General
                                 Counsel and Director       March 14,
                                                            1996


            /s/ Grahame N.
            Clark, Jr.        
            Grahame N. Clark,    Director                   March 14,
                                                            1996

            /s/ Jack D. Knox  
                              
            Jack D. Knox         Director                   March 14,
                                                            1996


            /s/ Joseph V.
            Mariner, Jr.      
            Joseph V.            Director                   March 14,
                                                            1996

            /s/ Carmen C.
            Summers           
            Carmen C. Summers    Director                   March 14,
                                                            1996


            /s/ Joseph S.
            Thomson           
            Joseph S. Thomson    Chairman of the Board      March 14,
                                                            1996




                                         F-19
<PAGE>





                                                                 Exhibit 11

                              El Chico Restaurants, Inc.
                            Computation of Per Share Data
                 (In thousands of dollars, except per share amounts)





                                          

                                             Year Ended December 31,
                                              1995     1994      1993

               Computation of earnings per
               share: 
                  Net earnings              $3,958   $ 3,728   $2,713

                  Weighted average number
               of common shares
                    outstanding during the
               year                      4,017,086 4,108,9104,093,701




                  Net effect of dilutive
               stock options based
                    on the treasury stock
               method using the
                    average market price    29,403   151,382  159,854


                  Shares used for
               computation               4,046,489 4,260,2924,253,555


                       Earnings per share   $     
                                              0.98   $     
                                                       0.88    $     
                                                                 0.64



               Computation of fully diluted
               earnings per share:
                  Net earnings              $3,958   $ 3,728   $2,713

                  Weighted average number
               of common shares
                    outstanding during the
               year                      4,017,086 4,108,9104,093,701



                  Net effect of dilutive
               stock options based
                    on the treasury stock
               method using the 
                    greater of the average
               or ending price              37,942   151,589  227,697




                  Shares used for
               computation               4,055,028 4,260,4994,321,398


                                         F-20
<PAGE>






                       Fully diluted
               earnings per share           $     
                                              0.98   $     
                                                       0.88    $      
                                                                 0.63






















































                                         F-21
<PAGE>



<TABLE>
<CAPTION>
                                                                                EXHIBIT 21
                                         LIST OF SUBSIDIARIES   

                                                                               
                                                                      JURISDICTION OF
            VOTING STOCK OWNED
            NAME OF SUBSIDIARY                              FORMATION  BY THE COMPANY

            <S>                                                         <C>         <C> 
            El Chico Realty Corporation                                 Texas       100%
            Concepts, Inc.                                              Texas       100%
            El Chico Bebidas Company                                    Texas       23%
            El Chico Restaurants of Louisiana, Inc.                     Delaware    100%
            El Chico Corporation of Oklahoma, Inc.                      Oklahoma    100%
            El Chico Restaurant No. 20, Inc.                            Delaware    100%
            Southwest Cafes of Tennessee, Inc.                          Tennessee   100%
            El Chico Corporation                                        Georgia     100%
            El Chico Corporation of Alabama                             Alabama     100%
            El Chico Corporation of Florida                             Florida      100%
            Pronto Design & Supply, Inc.                                Texas       100%
            Nuevo Ventures, Inc.                                        Texas        100%
            El Chico Restaurants of Kentucky, Inc.                      Kentucky    100%
            El Chico Restaurants of Ohio, Inc.                          Ohio        100%
            El Chico Restaurants of Indiana, Inc.                       Indiana     100%
            El Chico Restaurants of Illinois, Inc.                      Illinois    100%
            El Chico Service Company                                    Delaware    100%
            ECRT, Inc.                                                  Delaware    100%

            NOTE:  Texas  El Chico Restaurants, L.P. is a  Limited Partnership between two
            wholly owned subsidiaries - El Chico Service Company and ECRT, Inc.


            SUBSIDIARIES OF CONCEPTS, INC.
             
            JURISDICTION OFVOTING STOCK OWNED
            NAME OF SUBSIDIARYINCORPORATIONBY CONCEPTS, INC.

            Concepts Beverages of Oklahoma City, Inc.                   Oklahoma    100%
            Concepts Beverages of South Meridian, Inc.                  Oklahoma    100%

            SUBSIDIARIES OF EL CHICO CORPORATION OF OKLAHOMA, INC.

            VOTING STOCK OWNED BY
            JURISDICTION OFEL CHICO CORPORATION
            NAME OF SUBSIDIARYINCORPORATIONOF OKLAHOMA, INC.


            Bebidas Company of Tulsa, Inc.                              Oklahoma    100%
            Bebidas Company of Oklahoma City, Inc.                      Oklahoma    100%
            Bebidas Company of Midwest City, Inc.                       Oklahoma    100%
            Bebidas Company of Tulsa No. 65, Inc.                       Oklahoma    100%
            Bebidas Company of Oklahoma City No. 36, Inc.               Oklahoma    100%
            Bebidas Company of Oklahoma City No. 101, Inc.              Oklahoma    100%
            Bebidas Company of Broken Arrow, Inc.                       Oklahoma    100%
            Bebidas Company of Oklahoma City No. 37, Inc.               Oklahoma    100%
            Bebidas Company of Tulsa No. 23, Inc.                       Oklahoma    100%
            Bebidas Company of Edmond, Inc.                             Oklahoma    100%

                                                 F-22
</TABLE>
<PAGE>