Texas Roadhouse Inc. reported that commodity price pressures have limited the upside the company originally forecast for fiscal 2011, but sales and unit growth maintained their momentum for the 350-unit chain in the second quarter.
For the second quarter ended June 28, Louisville, Ky.-based Texas Roadhouse grew its net income and earnings per share 7 percent to $16.08 million, or 22 cents per share, compared with $15.04 million, or 21 cents per share, a year earlier. Revenue increased 10 percent to $279.57 million, compared with $255.16 million in the previous year’s second quarter, reflecting three newly opened company restaurants and same-store sales gains of 4.4 percent at corporate locations and 3.6 percent at franchised stores.
President and chief executive G.J. Hart said newer locations of Texas Roadhouse continued to outperform the rest of the system’s older restaurants.
“We continue to build an increasing pipeline of new locations and expect to open at least 25 restaurants in 2012, a 25-percent increase over our forecast for this year,” Hart said. “We are pleased with our overall progress in an otherwise uncertain environment, and we continue to believe Texas Roadhouse is among the best-positioned companies in the casual-dining sector.”
The company added that same-store sales at company restaurants through the first four weeks of the third quarter were running approximately 3.9 percent ahead of the year-earlier period.
Inflationary headwinds caused Texas Roadhouse to moderate its earnings per share expectations for the full fiscal year, however. The company is now forecasting earnings growth of approximately 5 percent compared with a year earlier, as opposed to the range between 5 percent and 10 percent Texas Roadhouse projected before the start of fiscal 2011. The expectations assume same-store sales growth between 4 percent and 4.5 percent, as well as food cost inflation of roughly 4 percent.
Texas Roadhouse operates 279 restaurants and franchises another 71 locations in 46 states.
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