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Luby's returns to profit in 2Q

Luby's Inc., parent to the Luby’s cafeteria chain and Fuddruckers burger concept, swung to a profit in its second quarter from a year ago loss, the company said Tuesday.

Houston-based Luby’s booked a profit of $1.4 million, or 5 cents a share, for the second quarter ended Feb. 15, compared with a loss of $300,000, or 1 cent a share, in the same quarter last year. Last year’s quarter included $300,000 in after-tax expenses related to the acquisition of Fuddruckers.

Second-quarter revenue totaled $79.4 million, an increase of 3.8 percent from a year ago.

Same-store sales rose 2.2 percent at Luby’s Cafeterias, the company said, crediting an increase in average customer spending of 2.9 percent. Traffic declined 0.7 percent, the company said. Cafeteria same-store sales had increased 3.5 percent in the first quarter.

Luby’s will begin releasing Fuddruckers’ same-store sales results in the third quarter, when that division reaches 18 months in Luby’s portfolio. The company said corporate Fuddruckers’ locations saw a total sales increase 6.8 percent over the same quarter last year.

Luby’s Cafeteria generated $52.5 million in sales. The 60 company-operated Fuddruckers and Koo Koo Roo restaurants produced $20.9 million in sales, Luby’s reported.

The company said revenue from its Culinary Contract Services division, which operates in 19 facilities, rose to $4.2 million in the second quarter, compared with $3.1 million in the same quarter last year.

“During the quarter, we benefited from our local marketing initiatives and our brand building strategies, as well as unseasonably mild weather in our operating areas, especially our Texas markets,” Chris Pappas, Luby’s president and chief executive, said in a statement.

Franchisees opened two new locations in the quarter, one in Omaha and another in Del Rio, Texas.

“Our 2012 expansion plans are on track, and we still plan to open at least three company-owned Fuddruckers before the end of the fiscal year,” Pappas said.

The company has purchased land in Pearland, Texas, for a new Luby’s Cafeteria and a 2,500-square-foot Fuddruckers unit, Pappas said.

In guidance, the company said it expected same-store sales to increase between 1 percent and 2 percent for the fiscal year.

Luby’s has 92 cafeterias; 179 Fuddruckers, 122 of which are franchised; and four other non-core restaurants, including the Koo Koo Roo brand.

Contact Ron Ruggless at [email protected].
Follow him on Twitter: @RonRuggless

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