We went to Outback Steakhouse last night to celebrate my son’s 17th birthday. In prior years, you would have an hour wait to get a seat. Not last night. Plenty of seats available. By the time we left at 8:00, the place was practically empty. Restaurant sales in general have begun to plunge again as consumers are tapped out. I checked on Outback’s comp store sales and found they were positive by 3.6% in the quarter ending July 31. I also noticed that Outback began to open for lunch on May 1, for the 1st time in their history. This fact was conveniently left out of their press release. If you offer lunch this year and you didn’t offer lunch last year, the comp store sales aren’t so comparable. I see this as a desperate attempt to boost sales.
Have you seen examples of restaurants struggling?
Restaurant operators reported negative same-store sales for the fourth consecutive month in July, with the overall results similar to the June performance. Restaurant operators also reported a net decline in customer traffic levels in July. Restaurant operators have become less optimistic about their prospects for sales growth in recent months.
Outback parent sees positive sales trends
OSI reported Friday a profit of $19.2 million for the quarter ended June 30, compared with a net loss of $88.1 in the same quarter a year ago. Latest-quarter revenue rose 1.2 percent to $917 million. Restaurant sales were up 1.1 percent, to $908.9 million, the company said.
“The increase in revenue was driven by positive same-store sales in all brands, and store openings,” said Dirk Montgomery, chief financial officer for Tampa, Fla.-based OSI. Increases in same-store sales were offset by the loss of revenue from the sale of the 34-unit Cheeseburger in Paradise chain in September 2009, he said.
OSI’s four concepts each showed positive same-store sales and traffic in the quarter: At the 966-unit Outback, same-store sales rose 3.6 percent; at the 233-unit Carrabba’s, same-store sales increased 0.6 percent; at the 152-unit Bonefish Grill, results rose 5.6 percent; and at the 64-unit Fleming’s Prime Steakhouse and Wine Bar, results increased 9 percent. OSI maintains a minority joint-venture interest in Roy’s, but it does not report sales for that concept.