Good news out of Red Robin Gourmet Burgers
In the second quarter, Red Robin delivered impressive sales gains of 31.5% to $178.6 million. Its same-store sales at company-owned restaurants edged 3.1% higher. However, earnings plummeted 31.5% to $4.9 million. The company incurred various charges, which knocked per-share earnings down 32.6% to $0.29.
Management is pleased with the results it's seen from its national media campaign and its new initiatives regarding new restaurant openings. Feeling confident about its prospects, the company opened 11 new restaurants during the quarter, and the board authorized a $50 million share buyback. However, the company also lowered its full-year guidance to a range of $1.65 to $1.76 per share.
When you look at the combination of a share-repurchase plan, the seemingly constant costs weighing down profits, and lowered earnings, you start to suspect that this bird doesn't know which way to fly. From my perspective, it seems like more of the same at Red Robin. Unfortunately, that means more inconsistency. This bird has had its egg cracked and been grounded in the past.
While I prefer Red Robin's burgers to those at fast-food chains such as McDonald's
To see what's been cookin' at Red Robin, read:
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