Ryan’s deal deepens Buffets’ 2-Q losses to $34.9MRyan’s deal deepens Buffets’ 2-Q losses to $34.9M

EAGEN Miss. Buffets Inc., the operator or franchisor of 676 mostly buffet-style restaurants under the Old Country Buffet, HomeTown Buffet, Ryan’s and Fire Mountain brands, swung to a larger net loss of $34.9 million in its second quarter ended Dec. 13, versus a loss of $3.9 million in the same quarter a year earlier.

The company said the decrease in net income was due mainly to a $40 million refinancing loss, a $2.5 million loss on sale-leaseback transactions and a $5.5 million increase in interest expense, all of which were related to the company’s $876 million acquisition of Ryan’s Restaurant Group Inc. in November. The Buffets-Ryan’s deal created the largest buffet operator and franchisor, and the companies have said annual sales would total more than $1.7 billion.

In the 12-week second quarter, Buffets’ total sales rose 36.5 percent from a year ago to $297.9 million, also as a result of the acquisition of Ryan’s, which operated a chain of more than 300 namesake grill-buffet restaurants. Quarterly same-store sales dipped 0.2 percent at Buffets’ brands and declined 6.1 percent at Ryan’s units.