Comparable restaurant sales decreased 2.6% at company restaurants and 1.2% at franchise restaurants
Texas Roadhouse, Inc. (NasdaqGS: TXRH), today announced financial results for the 13 and 52 week periods ended December 29, 2009.
Results for the fourth quarter:
* Comparable restaurant sales decreased 2.6% at company restaurants and 1.2% at franchise restaurants;
* Five company restaurants opened and one franchise restaurant was acquired;
* Restaurant margins increased 237 basis points to 17.4%;
* Diluted earnings per share increased 40% to $0.12 from $0.09 in the prior year period.
Results for the full year:
* Comparable restaurant sales decreased 2.8% at company restaurants and 2.5% at franchise restaurants;
* 17 company restaurants and 3 franchise restaurants opened and one franchise restaurant was acquired;
* Restaurant margins increased 71 basis points to 17.7%;
* Diluted earnings per share increased 29% to $0.67 from $0.52 in the prior year period.
G.J. Hart, President and Chief Executive Officer of Texas Roadhouse, commented, “Sales trends continued to improve throughout the fourth quarter and, combined with a favorable commodities environment, we were able to generate our third consecutive quarter of year-over-year restaurant margin improvement. This drove profitability for the period and capped off a year where earnings per diluted share increased 29%, solidly exceeding our expectations. Looking to 2010 and beyond, we continue to believe Texas Roadhouse is well-positioned to gain market share based on our ongoing commitment to the basics of providing Legendary Food and Legendary Service. In addition, we remain committed to maintaining a conservative balance sheet.”
Outlook for 2010
The Company reported that comparable restaurant sales for the first seven weeks of fiscal 2010 decreased approximately 1.2% compared to the same period a year ago.
The Company estimates 2010 diluted earnings per share growth will be 5% to 10% compared to 2009. This estimate is based, in part, on the following assumptions:
* Comparable restaurant sales of negative 2% to flat;
* Approximately 15 company restaurant openings;
* Food cost deflation of approximately 2.5% to 3.0%; and
* Total capital expenditures of between $50-55 million.
Extension of Executive Officer Employment Contracts
On February 18, 2010, the Company amended the employment agreements of W. Kent Taylor, Chairman; G.J. Hart, President and Chief Executive Officer; Steven L. Ortiz, Chief Operating Officer; Scott M. Colosi, Chief Financial Officer; and Sheila C. Brown, General Counsel and Corporate Secretary. The amendments extended the term of each officer’s employment from January 7, 2011 until January 7, 2012 during which time each officer’s annual base salary and target bonuses will remain unchanged.
James F. Parker, Chair of the Compensation Committee of the Board of Directors commented, “The Board is delighted that the executive officers have agreed to extend the terms of their contracts for another year. This management team has functioned extremely well together for many years, and the Board believes the Company will be well-served by having the team remain together. Additionally, by maintaining salaries and bonuses at current levels, the Board of Directors and officers have shown a commitment to shareholders through sound fiscal practices.”
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