Ruby Tuesday Inc. swung to profit in the fourth quarter even though the casual-dining brand was facing same-store sales and traffic declines, the company said Thursday.
The Maryville, Tenn.-based company reported net income of $4.3 million, or seven cents a share, for the fourth quarter ended June 2, compared with a loss of $881,000, or one cent a share, for the same period last year.
Fourth-quarter revenue fell 3.4 percent, to $296.8 million, from $307.3 million in the prior-year period.
James “JJ” Buettgen, Ruby Tuesday president, chairman and CEO, said in a statement that “while we were disappointed with the fourth-quarter top-line results, both same-restaurant sales and guest counts improved throughout the quarter and into the first quarter of fiscal 2016.”
Ruby Tuesday said same-store sales declined 1.7 percent in the quarter at company-owned restaurants. Guest counts at those restaurants fell 4.6 percent in the quarter.
The company has been working on turning around the brand for the past year and a half.
“We are pleased with the progress we made on our brand transformation and business model initiatives in fiscal 2015,” Buettgen said.
In guidance for fiscal 2016, Ruby Tuesday forecast same-store sales in the range of flat to 2 percent positive.
During the quarter, the company prepaid $5.2 million of mortgage debt and simplified its debt structure by eliminating one mortgage lender with a payoff of $8.3 million of mortgage debt.
“We have continued to strengthen our balance sheet by reducing debt and building cash reserves,” Buettgen said.
Ruby Tuesday has also continued to trim underperforming restaurants. Between June 3, 2014, and the June 2-ended fiscal year, Ruby Tuesday closed 10 company-owned restaurants, and franchisees closed two.
The company ended its fiscal year with 736 owned and franchised Ruby Tuesday restaurants in 44 states, 13 foreign countries and Guam. The company also owned and operated 26 Lime Fresh restaurants in six states and the District of Columbia.