Landry’s losses narrow to $4.3M for 3rd Q

HOUSTON Landry’s Restaurants Inc. said Thursday it was able to significantly reduce its third-quarter net loss to $4.3 million, from a $30 million loss in the year-ago quarter, despite increased expenses related to raised interest rates that Landry’s pays on its debt and on smaller losses versus a year ago from discontinued operations.

The Houston-based company, which operates about 200 casual-dining restaurants and various entertainment and gaming venues, said revenue for the quarter ended Sept. 30 rose 5.1 percent to $301.9 million. Same-store sales rose 1 percent.

Landry’s spent most of the summer battling with its note holders over payment and interest rates on its $400 million debt. The holders had originally elected to call Landry’s notes immediately due, forcing the restaurant operator to restructure its debt at an unfavorable time, as the credit markets had tightened following the sub-prime lending bust. The battle went to court, and the parties eventually reached a settlement that called for a 2-percentage-point increase in the interest rate, which Landry’s said would increase annual interest expense by $8 million.

Landry’s latest-quarter per-share loss totaled 25 cents, compared with a loss of $1.36 a year ago. Latest-quarter results included 22 cents in expenses from increasing interest rates and the unrelated refinancing of Landry’s Golden Nugget hotel and casino chain. One-time costs of 46 cents per share related to the changed interest rate as well as 11 cents per share from the decrease in the fair market value of the debt agreement were included in the latest-quarter results.

Year-ago results included $1.63 per share in losses from discontinued operations that reflected restaurant closures, a write-down and an eventual sale within Landry’s Joe’s Crab Shack chain.

Landry’s continues to operate restaurants under the Landry’s Seafood House, Chart House, Rainforest Cafe and Saltgrass Steak House brands. From continuing operations, the company posted a quarterly loss of $3.2 million, compared with a $6 million profit a year ago.