The good news is that 2015 was a much better year than 2014 for the restaurant industry; the bad news is that same-store sales growth continued to decelerate during the fourth quarter.

Same-store sales in 2015 rose 1.6 percent, a 1-percent jump from the growth rate reported in 2014, and a 2.3-percent improvement compared with 2013 results, according to data reported by TDn2K’s Black Box Intelligence through The Restaurant Industry Snapshot, based on weekly sales from over 23,000 restaurant units and more than 120 brands, representing $57 billion dollars in annual revenue.

However, the industry seems to have crawled to the finish line this year, with same-store sales growing 0.4 percent during the fourth quarter, a 1.2-percent drop from third-quarter results, and the lowest quarterly same-store sales growth rate since the third quarter of 2014.

“Although the industry has now experienced six consecutive quarters of positive same-store sales growth, it is important to mention that every quarter since Q1, we have seen lower sales growth rates than during the preceding quarter,” said Victor Fernandez, executive director of insights and knowledge for TDn2K. “What is most concerning when analyzing this persistent slowdown in sales is that the 1.2-percent drop in year-over-year same-store sales growth experienced during Q4 compared with the previous quarter is the largest decline experienced by the industry in over two years.”

The U.S. economy continued to expand during the fourth quarter, particularly with job gains and spending on big-ticket items, but some weakness persists, according to Joel Naroff, president of Naroff Economic Advisors and TDn2K’s retained economist.

“There are holes in the expansion related to the collapse of energy prices and the jump in the value of the dollar. This has led to regional weakness in energy-dependent areas and a softening in the manufacturing sector,” Naroff said. “The differentials in growth across areas created differentials in consumer spending. The TDn2K data clearly shows that some of the weakest areas line up with those states and metropolitan areas that are dependent on the energy sector, manufacturing or tourism, which is hurt by the rising value of the dollar.”

The drop in same-store sales growth experienced during the fourth quarter was largely a result of a sharp decline in same-store traffic during the quarter. Traffic declined 2.2 percent during the quarter, a 1-percent drop from the growth rate reported for the third quarter. The result for the final quarter of 2015 represent the worst traffic growth rate since the first quarter of 2014. On a two-year basis, the fourth quarter of 2015 posted a 2.3-percent decline in same-store traffic compared with the last quarter of 2013, evidence that after the recession, the main challenge for restaurant chains has been holding onto customers and visit frequency.

For the fifth consecutive month, California was the best performing region in December, with same-store sales rising a robust 4.2 percent, while achieving same-store traffic growth of 0.1 percent. California has been among states leading the country in reducing their unemployment rate and improving personal income.

On the opposite end of the spectrum, the Southwest has been the worst performing region for four consecutive months. Same-store sales fell 4.4 percent in the Southwest in December, while traffic declined 6.2 percent during the month. The challenges faced by the energy sector seem to be translating to reduced restaurant spending in most of the Southwestern states of Oklahoma, Arkansas, Louisiana and New Mexico.

When looking at performance by individual market, it is clear that the industry has been facing increased regional challenges during the fourth quarter. Of the 193 DMAs tracked by Black Box Intelligence, 55 percent achieved positive same-store sales during December. On average, only half of DMAs tracked attained positive sales growth during the last three months of the year, while the average for the first nine months was a healthier 73 percent of all DMAs with positive same-store sales growth.