Bloomin’ Brands Inc. saw same-store sales increases at its brands during 2012 but warned of a difficult start to 2013 for the casual-dining segment.
Tampa, Fla.-based Bloomin’ Brands reported a 3.5-percent increase in domestic company-owned same-store sales during the Dec. 31-ended fourth quarter of 2012, driven by a 2.2-percent increase in traffic.
Broken down by brand, same-store sales rose 5.3 percent at company-owned Outback Steakhouse locations, 1 percent at Bonefish Grill and 4 percent at Fleming’s Prime Steakhouse & Wine Bar during the quarter. Same-store sales fell 0.4 percent at company-owned Carrabba’s Italian Grill restaurants during the fourth quarter.
All brands, however, saw same-store sales increases in fiscal 2012. During the year, they rose 4.4 percent at Outback, 1.7 percent at Carrabba’s, 5.1 percent at Fleming’s and 3.2 percent at Bonefish Grill. During 2012, blended same-store sales increased 3.7 percent at Bloomin’ Brands' domestic company-owned locations, driven by a traffic increase of 2.7 percent.
The quarter marked Outback Steakhouse’s 11th consecutive quarter of same-store sales increases, said Bloomin’ Brands chief executive and chairman Elizabeth Smith during a call with analysts. “We continue to perform well above the industry average,” she said of the company, adding, “Outback is executing well in all aspects of the Bloomin’ Brands playbook.”
The company gave credit, in part, to value promotions, renovations and daypart expansions for the sales lifts at its brands.
However, Smith described the start to 2013 as “choppy” for the casual-dining segment, noting that there were “still some lingering political issues" that the company believes is causing some "uncertainty" for consumers.
“In 2013 the consumer will remain focused on value, but in our mind, value is not solely determined by price,” she said.
Smith said the company will continue to focus on improving the full customer experience. “What we won’t do is degrade our brands through extreme promotions,” she noted.
Outback will continue to expand its lunch offerings in 2013, gradually rolling it out on weekdays, she said. Outback introduced lunch at some locations on Sundays starting in 2011 and on Saturdays in 2012. So far, weekday lunch has been introduced at 25 percent of Outback locations and 9 percent of Carrabba’s locations.
“That’s going to be a multi-year rollout,” she said. “We’re very encouraged by it.”
Although Carrabba’s didn’t perform as well as Bloomin’ Brands’ other assets in 2012, the brand stands to grow in 2013, Smith said. The company plans to add a broader base of menu items at Carrabba’s throughout the year, as customers want more flexibility.
“Carrabba’s is a healthy, strong brand,” Smith said. “These changes are going to make it stronger.”
Bloomin’ Brands reported net income for the fourth quarter was $18.4 million, or $0.15 per share, falling from $30.5 million, or $0.28 per share the year prior. During fiscal 2012, net income dropped to $61.3 million, or $0.44 per share, from $109.2 million, or $0.94 per share, in 2011.
The net income decrease was due to expenses related to the company’s August initial public offering, management fees and debt refinancing, the company said in a statement. When adjusted for those expenses, net income for the quarter was $25.8 million, or $0.20 per share, compared with $10.7 million, or $0.10 per share during the fourth quarter 2011. For the full year, adjusted net income was $114.0 million, or $0.99 per share, an increase of $86.5 million, or $0.81 per share, the year prior.
Revenue for the fourth quarter increased 4.5 percent to $998.4 million from $955.6 million the year prior. For the full year, the company reported $4 billion in revenue in 2012, compared with $3.8 billion in 2011, a 3.8-percent increase year over year.
Revenue increases were due to an uptick in customer traffic and menu price increases, the company said in a statement.
The company predicts same-store sales to improve by at least 2 percent in 2013, with total revenue of $4.2 billion.
Bloomin’ Brands is the parent company of Outback Steakhouse, Carrabba’s Italian Grill, Bonefish Grill, Fleming’s Prime Steakhouse & Wine Bar and Roy’s. As of Dec. 31, the company had nearly 1,500 company-owned and franchised locations.
Contact Erin Dostal at [email protected].
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