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Ruth’s Chris’ 1st-Q profit drops 33%

HEATHROW Fla. Ruth's Chris Steak House Inc. continued its downward spiral during the first quarter with a 33-percent plunge in profit despite a 21-percent upswing in revenues, the high-end steakhouse operator and franchisor reported Tuesday.

The company attributed the gain in revenues to having more restaurants open. Same-store sales decreased 6.9 percent in the first quarter, compared with a 1.9-percent increase during the same period of 2007, said the company, which dismissed chief executive and president Craig Miller about two weeks ago. The comparable-store sales results reflected in a 2-percent increase in average checks, which were lifted by price increases of about 2.8 percent and changes in the sales mix.

For the 13 weeks ended March 30, the company earned $4.5 million, or 19 cents per share, compared with earnings of $6.8 million, or 29 cents per share, in the year-ago quarter, when the company booked a gain of $2.4 million in Hurricane Katrina-related insurance proceeds.

In the latest quarter, Ruth’s Chris logged lower food and beverage costs, a result of what the company said were favorable beef costs. However, the company said, interest expenses rose, as did restaurant-operating expenses as a percentage of sales.

Revenue for the fiscal first quarter totaled $98.6 million, up from $81.5 million, including $9.9 million from the recent acquisition of 22 restaurants from Cameron Mitchell Restaurants for $94 million. Total sales generated by the 19 Mitchell's Fish Markets and three steakhouses were $9.9 million during the first quarter, Ruth’s Chris said. The company now operates or franchises about 121 locations.

Two franchised Ruth's Chris restaurants were opened during the quarter, in Aruba and in Myrtle Beach, S.C. In the ongoing second quarter, a company-owned restaurant has opened in Fort Worth, Texas, and another is expected to open in downtown New Orleans on May 12.

Until Miller’s successors as CEO and president are named, Ruth's Chris will be steered by an executive committee, the company said.

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