According to the National Restaurant Association, or NRA, the restaurant industry represents approximately 4% of the U.S. gross domestic product. The NRA forecasts that restaurant industry sales in the United States (the "U.S. restaurant industry") will continue to rise in 2004, reaching $440 billion. The NRA estimates that the U.S. restaurant industry today encompasses approximately 878,000 full-service restaurants, and this number is expected to grow to over 1,000,000 by 2010.

The NRA also estimates that total sales in the U.S. restaurant industry for 2003 exceeded $420 billion, marking 12 consecutive years of growth and sales in the full-service segment of the U.S. restaurant industry grew approximately 7.9% between 2001 and 2003, reaching over $150 billion in 2003. It is estimated that sales at full-service restaurants will increase approximately 4.6% in 2004 to $158 billion.

Technomic, Inc., a national consulting and research firm, forecasts sales at U.S. full-service restaurants to grow at a compounded annual rate of 5.5% from 2002 through 2007, compared to forecasted compounded annual growth of 5.0% for the total U.S. restaurant industry for the same period. According to Technomic, the varied menu category within the full-service restaurant segment of the U.S. restaurant industry is projected to grow at an 8.5% compounded annual growth rate from 2002 through 2007, the highest projected compounded annual growth rate over that period for all menu categories. In addition, Technomic anticipates that the seafood marketplace will benefit on a continuing long-term basis as consumers show a greater interest in better health and specialized diets.

The Company’s daily-printed menu typically contains between 85 and 110 made-to-order dishes, including an extensive selection of international, national, regional and local species of seafood.

The Company’s restaurants are designed to capture the distinctive characteristics of each local market, positioning the Company to compete successfully in a sector comprised primarily of locally-owned and operated seafood restaurants.

The Company’s menu typically offers the customers between 85 and 110 made-to-order dishes each day, with at least 30 different varieties of fresh seafood.

In addition to seafood, the Company’s menus offer a wide range of options to those consumers who would prefer a non-seafood entrée. Among these non-seafood offerings are Sichuan chicken salad, prime rib French dip, pasta primavera, prime New York steak strip, and roasted herb crusted chicken.

The Company encitsages each of its restaurants to purchase seafood from a network of preferred vendors the Company has identified as consistently supplying seafood that meets the Company’s high standards. The identification and selection of seafood suppliers is reviewed regularly based on product quality, sanitation, fishing practices, pricing and customer service.

The Company’s restaurant designs and décor are intended to capture distinctive attributes of each local market, varying from traditional New England-style fish houses to contemporary dinner houses with waterfront views. The Company’s restaurants are often located in historic buildings, which reinforces the Company’s commitment to local design elements and further promotes the appeal and ambience of the Company’s restaurants.

Food and beverage costs increased by $4.8 million, or 9.0%, to $58.0 million in 2003 from $53.2 million in 2002.

Labor costs increased by $5.5 million, or 9.8%, to $61.6 million in 2003 from $56.2 million in 2002.

Operating costs increased by $2.8 million, or 10.8%, to $29.2 million in 2003 from $26.4 million in 2002.

General and administrative expenses increased by $2.2 million, or 29.0%, to $9.8 million in 2003 from $7.6 million in 2002.

Interest expense decreased by $0.7 million, or 17.5%, to $3.1 million in 2003 from $3.7 million in 2002.

Income tax expense decreased by $1.6 million, or 51.2%, to $1.5 million in 2003 from $3.1 million in 2002 .