Red Thursday, Ruby Tuesday

When your slogan is "Fresh simple American dining," you're setting yourself up to go with "stale simpleton American whining" when the multicolored tortilla chips are down. That's the kind of downer that Ruby Tuesday (NYSE: RT) investors are facing today after the company posted lackluster numbers last night.

Fiscal-first-quarter earnings clocked in at $0.21 a share for the period, well off the $0.37-per-share profit that Ruby Tuesday generated a year earlier, but in line with hosed-down shareholder expectations. Revenues inched just 2.4% higher to $346.8 million.

Comps were crushed, with same-unit sales tumbling 4.8% at company-owned restaurants (which account for 99% of Ruby Tuesday's revenue). Franchised locations suffered a 2.9% dip.

The store-level malaise is old news. Ruby Tuesday investors have already been told of the summer weakness in grim, monthly spoonfuls. It's not pretty to see the sequential degradation taking place at the chain. July was weaker than June, and August was weaker than July. But again, that lasagna layer of pessimism was already baked into the market's expectations.

What's troubling at this point is that the trend will continue. Ruby Tuesday expects comps to fall by 6% to 8% during the current quarter. The chain expects to reverse the trend in the second half of the year, but comps should still close out fiscal 2008 in the red to the tune of a 3%-5% dip.

The clincher? The company is now looking to earn between $1.01 a share and $1.13 a share for all of fiscal 2008. Even if you tack on as much as $0.20 per share in remodeling costs, it's still well short of the $1.48 per share that Wall Street was expecting.

And are we really to believe that a little fresh paint and spruced-up interior design work is enough to refresh the concept? Seriously. Here's a thought. Become a candy store and call yourself Ruby Tooth Decay.

Casual dining isn't necessarily broken, although chains like Brinker (NYSE: EAT), Applebee's (Nasdaq: APPB), and P.F. Chang's (Nasdaq: PFCB) are smarting with recent strings of negative quarterly comps. Cosi (Nasdaq: COSI) was shaping up to be an intriguing turnaround story, but it conveniently abandoned its practice of providing financial guidance just as its losses widened over the summer.

These are tricky times for concepts that don't bring something new to the table like Polynesian-influenced Kona Grill (Nasdaq: KONA) or the teppanyaki-stylings of Benihana (Nasdaq: BNHNA).

In short, Ruby Tuesday's problem may very well be its emphasis on fresh and simple American dining. If you're focusing on the basics, how will you win over patrons who value eating out as something special?