HEATHROW Fla. Ruth’s Hospitality Group Inc., parent company to the Ruth’s Chris Steak House and Mitchell’s Fish Market chains, posted Friday double-digit declines in both sales and profit for the second quarter.
For the quarter ended June 28, net income fell 16 percent to $2.3 million, or 10 cents per share, from year-ago earnings of $2.8 million, or 12 cents per share. Latest-quarter revenue fell 18 percent to $88.4 million.
The company said that lower beef costs and corporate cost controls helped drive profit, which even though down from a year ago, still beat Wall Street expectations.
Same-store sales for corporate Ruth’s Chris Steak Houses fell 23.4 percent. At Mitchell’s Fish Market, same-store sales at corporate locations slid 9.8 percent. Many high-end chain restaurants have had significant sales troubles of late. Both Morton’s, The Steakhouse and Oceanaire Seafood Room have recently shuttered locations. During the second quarter, Ruth’s Chris closed one unit and also sold its former headquarters in New Orleans. It also registered with securities regulators to raise money through a share offering.
“We are clearly executing on two of our three highest priorities this year: maximizing free cash flow and paying down debt,” Michael O’Donnell, president and chief executive, said in a statement. “Not surprisingly, our third priority, recapturing lost traffic, has been more of a challenge.”
He said the company is trying to regain those lost customers by offering a prix fixe menu as well as value meals.
There will be no corporate unit development this year and franchisees are expected to open between three and five franchised restaurants.
Ruth’s Hospitality Group, which in addition to the Ruth’s Chris Steak House and Mitchell’s Fish Market chains, owns the Mitchell’s Steakhouse and Cameron’s Steakhouse upscale concepts, operates or franchises more than 150 locations.
Contact Elissa Elan at [email protected].