CARLSBAD Calif. Third-quarter profit fell 38 percent for the parent of the fast-casual Rubio’s Fresh Mexican Grill chain, as labor, occupancy and advertising costs rose, along with charges for store closures.
For the quarter ended Sept. 27, Rubio’s Restaurants Inc. reported net income of $487,000, or 5 cents per share, compared with earnings of $789,000, or 8 cents per share, in the same year-ago quarter.
The company said that labor costs increased 1.3 percent, as a percent of sales, and that advertising expenses, used primarily for a study used to help Rubio’s better understand it guests, also increased during the quarter.
Latest-quarter revenue totaled $48.4 million for the quarter, up 3 percent over a year ago. Same-store sales for the 195-unit chain fell 2.7 percent. The company said the results reflected lower transaction volumes and an increase to the average check per customer.
Last week, Rubio’s board of directors unanimously rejected an $8-per-share buyout offer totaling about $80 million from an investor group including Alex Meruelo, a developer and Rubio’s investor, and private-equity firm Levine Leichtman Capital Partners IV LP. The company said the offer was not in the best interest of shareholders.
The company has hired financial advisor Cowen and Co. to evaluate strategic alternatives to enhance stockholder value, including the consideration of “expressions of interest” received by the company.
Contact Lisa Jennings at [email protected].
