Ruby Tuesday Inc., which has closed 109 restaurants in the past year, is promoting it’s the brand’s menu affordability and value as it works to stem declining same-store sales, the company said Thursday.
The Maryville, Tenn.-based casual-dining brand said same-store sales in the second quarter ended Nov. 29 were down 4.1 percent, compared to a 0.8 percent increase in the prior-year period.
“While the results of our fiscal second quarter were disappointing,” said Lane Cardwell, Ruby Tuesday interim CEO and president, in a statement, “I am excited about the strategic changes and the new product rollouts that began with the introduction of our fresh new menu in November and will continue in January with the national launch of our fresh new Garden Bar.”
Cardwell, a Ruby Tuesday board member since October 2012, assumed the CEO role in September after the resignation of James J. “JJ” Buettgen and the company’s August announcement that it would close 95 restaurants.
With the restaurant closures, Ruby Tuesday in the second quarter saw revenue decline 17.7 percent, to $214.7 million. Net loss for the quarter was $38 million, or 63 cents a share, compared to a loss of $14.8 million, or 26 cents a share, in the prior-year quarter.
Cardwell said the two-stage Fresh Start program included the new menu in November, which he said was “designed to showcase the affordability and value that Ruby Tuesday offers,” as well as the reimaging of the Garden Bar.
The new menu reduced the number of items by 30 percent, the company said, and simplified operations by removing complicated items.
The company viewed the Garden Bar, which will begin rolling out systemwide on Jan. 17, “as our greatest brand differentiator,” Cardwell said, because it appeals to the consumers’ desire for fresh and healthy options.
The company expects to complete 13 store remodels by the end of January, and then it will put the program on hold to measure the results.
Ruby Tuesday is also in the process of selling 25 properties, including 20 as part of the August closures, and expects average net proceeds of $1.6 million per location.
During the quarter, Ruby Tuesday completed the sale of its corporate property at 150 W. Church Avenue in Maryville for $2.8 million. Headquarters staff will be relocated to the Maryville Restaurant Support Center at 333 E. Broadway Avenue by the end of January, 17
As of Nov. 29, Ruby Tuesday had 613 restaurants systemwide, of which 546 were company-owned. During the second quarter, one company-owned Ruby Tuesday restaurant and one international franchised location closed, taking the brand’s total abroad to 49.
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