DALLAS Brinker International Inc., parent of Chili’s Grill & Bar and other casual-dining chains, swung to a loss of $38.8 million in its March-ended quarter, versus a year-ago profit of $54.6 million, because of charges and losses from its Romano’s Macaroni Grill brand, which is currently up for sale.
For the company’s fiscal third quarter ended March 26, per-share results fell to a loss of 38 cents from year-ago earnings of 43 cents.
Excluding special items and the now discontinued operations of the 224-unit Macaroni Grill, Brinker earned $33.7 million, or 33 cents per share, down from $46.5 million, or 37 cents per share, a year ago. The latest-quarter result beat analyst expectations by one cent, according to an average from Thomson Financial.
Revenue in the latest quarter slipped 3.9 percent to $907.7 million, from $944.0 million in the third quarter last year. Same-store sales at locations open at least a year rose 1.1 percent, the company reported. That result reflected a same-store sales gain of 1.6 percent at Chili’s and dips of 1.8 percent at On the Border Mexican Grill & Cantina and 0.4 percent at Maggiano’s Little Italy. The positive blended same-store sales result was driven by a year-to-year price increase of 3.1 percent, the company reported, which indicated that traffic at the company’s chains is still in negative territory.
Brinker also reported a year-to-year decline in restaurant capacity, or operations, as the company has closed units and sold corporate locations to franchisees. The company said franchisee royalty revenue, however, increased about 75 percent in the latest quarter to $15.7 million.
During the quarter, Brinker said it closed or declined lease renewals on 21 restaurants and that it would reduce the number of domestic new restaurant openings to 70 locations this year, about 15 restaurants in fiscal 2009, and “even fewer in fiscal 2010.” Latest-quarter charges on those closures and the changed development plans totaled $16.5 million after tax, or 16 cents per share, Brinker reported.
Brinker has 1,868 restaurants, including 1,439 Chili’s, 163 On the Border Mexican Grills and 42 Maggiano’s units.