HOUSTON Landry’s Restaurant Inc. said Thursday that interest expenses and debt-refinancing costs dragged the company to a fourth-quarter net loss.
The hospitality company, which owns such casual-dining restaurants as Landry’s Seafood House, Rainforest Café and Chart House and is considering a buyout offer from chief executive Tilman Fertitta, reported a net loss of $35.6 million, or $2.20 per share, for the quarter ended Dec. 31, compared with a profit of $4.6 million, or 28 cents per share, in the same quarter a year earlier.
Latest-quarter revenue fell 3.3 percent to $245.3 million. Same-store sales fell 5 percent among the company’s restaurants and 8 percent at its gaming operations, which including the Golden Nugget Hotels and Casinos in Las Vegas and Laughlin, Nev.
Landry’s said the quarter included a $23.2 million charge related to debt-refinancing costs and an added interest expense of $8.1 million. Insurance proceeds related to Hurricane Ike in 2008 had brought an $11.5 million benefit in the year earlier quarter. Excluding these items, Landry's would have lost $5.2 million in the latest fourth quarter.
For the full year, Landry’s lost $16.2 million, or $1 per share, compared with a profit of $2.9 million, or 18 cents per share, in 2008. Fiscal 2009 revenue fell 7.3 percent to $1.06 billion.
Landry’s said it was reducing costs throughout its businesses and was cutting back on expansion. “As a result of the higher interest costs, lower consumer spending and continued economic uncertainty,” Landry’s said, “the company expects to reduce its unit growth and conserve capital for debt repayment.”
Fertitta, chairman and chief executive of Landry’s who already owns more than half of the company’s shares, is in the process of taking the hospitality company private. He has offered $14.75 for outstanding shares in a deal the company values at about $1.2 billion.
Last November, hedge-fund manager William Ackman of Pershing Square Capital Management, a well known activist investor, acquired a large stake in Landry’s and signaled his intent to oppose Fertitta’s bid.
The acquisition still needs shareholder approval.
Besides the Golden Nugget properties, Landry’s also owns and operates Landry’s, Chart House, Rainforest Café, Saltgrass Steak House and finer-dining restaurants in its Signature Group as well as other hotels, marinas, amusements and other businesses.
Contact Ron Ruggless at [email protected].