Restaurant operator Luby's (NYSE: LUB ) reported earnings that fell sharply in the second quarter, as food cost inflation and consumers tightening their discretionary spending sapped expansion. Profits dropped 81% to just $203,000, or $0.01 per share, from $1.1 million, or $0.04 per share in the year ago period. Revenues, however, were up 10%, to $87.5 million, mainly from the December acquisition of the Cheeseburger in Paradise chain.
Same-store sales at restaurants open at least 18 months, a key retail metric because it eliminates the effects of expansion by measuring organic growth only, fell 0.6% in the quarter.
Luby's runs 94 Luby's Restaurants, 54 Fuddruckers, two Koo Koo Roos, and now 23 Cheeseburger in Paradise restaurants.
The restaurant operator offered full-year earnings guidance of $0.21 to $0.25 per share, which is lower than its prior guidance of $0.27 to $0.30 per share.