TAMPA Fla. OSI Restaurant Partners Inc. posted a 20.3-percent, year-over-year decline in fourth-quarter net income as higher costs, especially for labor, offset the company's 9.1-percent revenue gain.
In a surprise announcement of fourth-quarter results, and possibly the company's last quarterly report prior to its pending $3.63 billion going-private buyout expected to close in April, OSI said it earned $21.8 million, or 29 cents per share, for the three months ended Dec. 31. A year earlier, the company posted profit of $27.4 million, or 36 cents per share. Latest-quarter revenues totaled $1.01 billion.
As previously reported, same-store sales for the fourth quarter remained flat from a year earlier at the company's flagship Outback Steakhouse chain. Same-store sales fell 2.5 percent at Carrabba's Italian Grill and 0.2 percent at Bonefish Grill, but rose 3.5 percent at Fleming's Prime Steakhouse & Wine Bar and 0.2 percent at Roy's.
In its latest quarter, OSI's cost of sales rose 7 percent and labor costs increased 15 percent from a year earlier. OSI said after adjusting for its new Partner Equity Program, which replaces the issuance of stock options with a deferred compensation program, and for the accounting change for stock-based compensation, the company would have posted per-share earnings of 37 cents in its fiscal 2006 fourth quarter.
For the year, OSI recorded net income of $100.2 million, or $1.31 per share, down from earnings of $146.7 million, or $1.92 per share, in fiscal 2005. Full year revenues rose 9.1 percent to $3.94 billion.