Steakhouse operator reports 4.6-percent decline in beef costs during the quarter
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Lower beef prices helped Ruth’s Hospitality Group Inc. post a 3.3-percent increase in profit for the first quarter ended March 27, the company said Thursday.
“Our first-quarter results were highlighted by solid top-line growth and a favorable commodity environment,” said Michael P. O'Donnell, Ruth’s Hospitality chairman, president and CEO, in a statement.
The company said food and beverage costs as a percentage of restaurant sales decreased 87 basis points in the first quarter, to 29.6 percent. That was “primarily driven by a 4.6-percent decline in total beef costs.”
The Winter Park, Fla.-based steakhouse operator said net income rose to $10.8 million, or 33 cents per share, from $10.4 million, or 30 cents per share, in the same quarter a year ago. The company took a $200,000 after-tax charge in the quarter for the closure of a restaurant in Columbus, Ohio.
Revenue grew 4.7 percent, to $101.9 million, from $97.3 million in the prior-year quarter.
O’Donnell said the quarter also saw the steakhouses post positive same-store sales and return to positive traffic growth.
Same-store sales at company-owned Ruth’s Chris Steak Houses increased 3.1 percent in the first quarter. That included a traffic increase of 0.9 percent and an increase in average check of 2.2 percent.
Restaurant operating expenses as a percentage of restaurant sales increased 49 basis points in the first quarter, to 45.8 percent, which the company said was primarily caused by increased labor costs.
During the first quarter, Ruth’s Hospitality repurchased 732,000 shares of common stock under the company’s repurchase program, buying back about $11.7 million shares, or an average price of $15.92 each. The company’s board authorized share purchases up to $60 million, replacing a 2014 authorization of $50 million, which has been retired.
Ruth's Hospitality Group has more than 145 restaurants systemwide.
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