Red Robin Gourmet Burgers is scheduled to open a smaller fast-casual concept later this month called Red Robin Burger Works, the company said Thursday.
Steve Carley, Red Robin’s chief executive, unveiled details of the new restaurant in a call to analysts after reporting a third-quarter profit of $2.1 million, or 14 cents per share, compared with a loss of $4.2 million, or a loss of 27 cents per share, in the same quarter last year.
Red Robin said earlier this year they planned to test the smaller prototype as a vehicle for non-traditional locations.
The move would also allow the casual-dining chain to more directly compete with rapidly growing burger players in the fast-casual world, like Smashburger and Five Guys Burgers & Fries.
The new Burger Works concept is scheduled to open on Nov. 21 in Denver’s Northfield Stapleton shopping center.
On the limited menu are third-pound all-natural beef burgers and chicken breast sandwiches priced between $4.49 and $6.49, including build-your-own options.
Burger Works offers a few items from Red Robin’s signature burger line, such as the Whiskey River BBQ and teriyaki-spiked Banzai burgers, as well as fries, sweet potato fries and onion straws. Beer and wine will be available, as well as hand-spun shakes and a s’mores cookie or s’mores cookie sundae for dessert.
Carley said the company plans to open a couple more locations in the Denver metro market next year, though the Burger Works’ website indicates that the brand might also open on the campus at Ohio State University in 2012.
The goal is to develop a format that could work for non-traditional locations like airports, military bases, college campuses, food courts and stadiums, Carley said.
Since full-service Red Robin units, which are typically about 6,000-square feet, tend to go into suburban locations near movie theaters, the smaller prototype would also aim to fit into urban locations, where such large real estate would be hard to find.
“We are basically unrepresented in urban environments,” Carley said.
However, the company plans to move slowly and carefully to evaluate the new concept before pushing forward.
“If you expand faster than your human resources and training can handle, you will disappoint your guests and you will come to a bad place,” he said.
For the quarter ended Oct. 2, Red Robin said systemwide revenue was up 5.9 percent to $206.2 million.
Same-store sales at company-owned restaurants during the quarter were up 2.1 percent, driven by a 5.3-percent increase in average check that was partially offset by a 3.2-percent decrease in guest counts.
It was Red Robin’s fifth consecutive quarter of same-store sales growth and fourth consecutive quarter of earnings growth, Carley said.