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Bloomin’ Brands CEO: Delivery is now profitable

Discounting? Not so much

Delivery continues to grow for Bloomin’ Brands, the parent to Outback Steakhouse and Carrabba’s Italian Kitchen said Friday.

The Tampa, Fla.-based casual-dining company reported first-quarter consolidated earnings of $64.3 million, or 69 cents per share, down from $$65.4 million, or 68 cents per share, a year ago. Consolidated revenues for the quarter totaled $1.1 billion.

Delivery and off-premise made up 14% of the total business of Outback and Carrabba’s, the company said. Delivery is available at 550 Outback and Carrabba’s as of the end of the March 31-ended quarter. That’s up from 488 reported in the previous quarter.

“Importantly, [delivery] business is profitable now that the business is reaching scale, we will begin augmenting existing local marketing efforts with additional tactics to drive awareness,” said Bloomin’s new CEO David Deno.

“We remain very excited about the incremental opportunity [delivery] represents as we capitalize on the growing consumer demand for enjoying restaurant meals at home, said Deno, who succeeded Elizabeth Smith on April 1.

Domestic same-store sales were up — 2.4% for the overall company, and 3.5% and 0.3% for Outback and Carrabba’s, respectively. The company credited the higher comp sales in part to improved check average (up 3.3% overall) and fewer discounts.

“We made a really good conscious decision to manage our discounting down a bit at Outback,” Deno said. “We've been trying to remove discounting of our portfolio and really focus on other parts of the business.”

Not surprisingly, with an emphasis on delivery and a de-emphasis on discounts, traffic was down 0.9% for the overall company. Traffic was down 0.5% for Outback and down 1.3% for Carrabba’s.

Bloomin’, which owns Bonefish Grill and Fleming’s Prime Steakhouse & Wine Bar, also highlighted success in restaurant relocation, restaurant redesign, and Brazilian operations.

Bloomin’ Brands currently operates or franchises 1,500 restaurants in 48 states, Puerto Rico, Guam, and 20 other countries.

“The international business continues to exceed expectations, especially in Brazil,” Deno said during the call.

And the company sees delivery as a growth opportunity overseas as well as domestically.

“We have two emerging opportunities in Brazil. The first is Abbraccio [Cucina Italiana] with growing sales and economics,” Deno said. “We currently have 12 locations and believe there is the potential for at least 50 locations. The second is a rapidly growing delivery business. We have a great local partner and currently have delivery in 12 locations with the opportunity to add many more.”                                                                                     

Contact Gloria Dawson at [email protected]

Follow her on Twitter: @GloriaDawson

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