Results for the third quarter included the following highlights:
Comparable restaurant sales increased 5.5% at company restaurants and 4.2% at domestic franchise restaurants;
Restaurant margin, as a percentage of restaurant and other sales, decreased 157 basis points to 16.2%, primarily due to higher labor costs, including the impact of insurance reserve adjustments. Restaurant margin dollars increased 0.3% to $95.8 million from $95.6 million in the prior year;
Diluted earnings per share decreased 6.7% to $0.40 from $0.43 in the prior year primarily due to higher labor costs and higher general and administrative expenses partially offset by higher revenues and lower income tax expense; and
Three company restaurants and one international franchise restaurant were opened.
Results for the year-to-date period included the following highlights:
Comparable restaurant sales increased 5.4% at company restaurants and 4.1% at domestic franchise restaurants;
Restaurant margin, as a percentage of restaurant and other sales, decreased 102 basis points to 17.9%, primarily due to higher labor costs. Restaurant margin dollars increased 4.6% to $328.6 million from $314.3 million in the prior year;
Diluted earnings per share increased 23.5% to $1.78 from $1.44 in the prior year primarily due to higher revenues and lower income tax expense partially offset by higher labor costs. In addition, we recorded a pre-tax charge of $14.9 million ($9.2 million after-tax), or $0.13 per diluted share, in the first quarter of 2017, related to the settlement of a legal matter; and
17 company restaurants, including four Bubba’s 33 restaurants, and four international franchise restaurants were opened.
Kent Taylor, Chief Executive Officer of Texas Roadhouse, Inc., commented, "Our top-line momentum continued this quarter highlighted by positive comparable restaurant sales, driven by positive traffic growth. However, restaurant-level performance continues to be pressured by higher labor costs. Despite the earnings decline this quarter, 2018 is still shaping up to be a good year for Texas Roadhouse."
Taylor continued, "Our new restaurant pipeline is solid and we feel good about our development plans for 2019. We are confident that our business is well positioned for long-term sales and profit growth. In addition, our healthy cash flow generation allows us to fund our new restaurant growth through internal cash flow, while also returning excess capital to our shareholders through our dividend program, further driving shareholder value."
Texas Roadhouse, Inc. - Texas Roadhouse, Inc. Announces Third Quarter 2018 Results
