Shares of Red Robin Gourmet Burgers, Inc. (NASDAQ:RRGB) were up 19.9% as of 2:00 p.m. EDT Wednesday after the restaurant chain delivered delicious first-quarter 2017 results.
Quarterly revenue climbed 4.1% year over year to $418.6 million, as contributions from new and acquired restaurants more than offset a 1.2% decline in comparable-restaurant revenue and the impact of closed locations. On the bottom line, Red Robin's net income declined 18.3% year over year to $11.6 million. And though net income per share declined 13.6% to $0.89, that was still well ahead of the $0.57 per share that investors were expecting.
Recall last quarter, Red Robin CEO Denny Marie Post noted that actions to "streamline the team and focus on value, speed, and service in the back half of last year" had already begun to result in improved guest service scores.
This time, Post elaborated:
The steps we've taken so far are strengthening our business, enabling us to gain market share, and separating Red Robin from our casual dining competitors. During the first quarter, our everyday value Tavern Double burger menu continued to drive traffic, our teams delivered on improved speed of service, and our recent investments in the growing off-premise use began to gain traction. The early success of these and other initiatives gives us confidence that we are laying the groundwork for improved performance for the balance of the year and beyond.
Looking forward, Red Robin expects full-year 2017 earnings per share of $2.80 to $3.10, with around 55% of that total expected in the second half of the year. That's well above the earnings of $2.76 per share that Wall Street was modeling before today.
This was a strong quarter from Red Robin that should leave investors rightly excited. It's no surprise to see Red Robin stock climbing higher as the market digests the news.