Bloomin’ Brands Inc., parent to the Outback Steakhouse, Carrabba’s Italian Grill and other brands, is closing 41 restaurants across its portfolio as it weighs under-performing units, executives said Friday.
David Deno, CEO of the Tampa, Fla.-based casual-dining company, which also owns the Bonefish Grill, Flemin’s Prime Steakhouse & Wine Bar and fast-casual Aussie Grill brands, said in an analysts’ call after releasing earnings for the Dec. 31-ended fourth quarter: “We periodically review our asset base and, in our latest review, we made the decision to close 41 underperforming locations. The majority of these restaurants were older assets with leases from the ‘90s and early 2000s.
A Bloomin’ Brands spokesperson said some closures are completed and 33 were closing on Friday.
“This decision considered a variety of factors including sales and traffic-trade areas and the investment that would have to be made to improve the restaurants,” Deno said. “Despite this initiative, our confidence in our portfolio remains high as we plan to open 40 to 45 new restaurants across the system in 2024.”
Chris Meyer, the company’s chief financial officer who announced his retirement Friday, said the closures are “split across the portfolio.” Meyer will continue in the role until a successor is named, Deno said.
Deno added that Bloomin’ plans to increase its 2024 marketing spend by $20 million to build traffic with a blend of television and digital advertising.
“We also recognize the consumer may be more careful with their discretionary spending,” Deno said. “Our current LTO, a three-course Aussie dinner for $16.99, offers the customer a great value. We will continue to be thoughtful of our approach to overall pricing and discounting. The ‘No Rules, Just Right’ campaign and the marketing investment are just the start of the work underway at Outback.”
However, Deno noted that the U.S. consumer is “hanging in there.”
Deno said another priority is off-premises sales, which represented about 24% of total sales in the fourth quarter.
In the United States, he added, “we were pioneers in the to-go space, and we continue to see robust demand” as well as “the success of our catering business at all of our brands, but particularly Carrabba's.”
For the fourth quarter ended Dec. 31, Bloomin’ Brands net income was $43.3 million, or 45 cents a share, compared to $58 million, or 61 cents a share, in the same quarter last year. Revenues in the quarter rose to $1.194 billion from $1.095 billion in the prior-year-period.
Fourth-quarter same-store sales at company-owned restaurants declined a combined 0.2%, including an increase of 2.6% at Carrabba’s and declines of 0.3% at Outback, 3% at Bonefish Grill and 0.3% at Fleming’s.
As of Dec. 31, Bloomin’ had 1,480 restaurants, including 688 Outback Steakhouses in the U.S., 217 Carrabba’s Italian Grills, 176 Bonefish Grills, 64 Fleming’s Prime Steakhouse & Wine Bars, five fast-casual Aussie Grills and 330 internationally.
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