Ruby Tuesday, Inc. (NYSE: RT) today reported financial results for the fiscal third quarter ended February 28, 2012.
Results for the third quarter of 2012 compared to the third quarter of 2011 include:
- Same-restaurant sales decreased 5.0% at Company-owned Ruby Tuesday restaurants
- Net income of $4.5 million, or $11.6 million excluding pre-tax impairment costs of $9.6 million in the third fiscal quarter related to the planned closure of 25-27 underperforming restaurants during the fourth quarter and $0.4 million of additional accounting gains realized in the third fiscal quarter from final purchase price adjustments associated with the fiscal 2011 franchise partner acquisitions. This compares to prior-year net income of $16.0 million, or $15.7 million excluding accounting gains realized from franchise partner acquisitions. We have included a reconciliation of these items and the related earnings per share impact on the Investor Relations page of the Ruby Tuesday website: www.rubytuesday.com.
- Diluted earnings per share of $0.07, or $0.18 per share excluding the impairment costs of the 25 to 27 planned restaurant closings in the fourth quarter and franchise partner acquisition accounting gains, compared to diluted earnings per share of $0.25 for the prior year, or $0.24 excluding the franchise partner accounting gains
- The Company announced plans to acquire Lime Fresh Mexican Grill for a purchase price of $24 million. The transaction, which represents the brand’s intellectual property rights and the assets of seven company-owned restaurants as well as the royalties from five franchised restaurants, is expected to close in the fourth fiscal quarter.
Sandy Beall, Founder, Chairman, and CEO, commented on the quarterly results, saying, “We believe the steps we have taken this quarter will enable us to positively impact our future sales and profits. While we were pleased with our earnings performance given our lower sales levels, we are clearly disappointed in our same-restaurant sales results for the third quarter. The promotional environment continues to be very competitive and over the past several quarters we have not competed well with the heavy television advertising levels of our peers. However, we feel good about our marketing strategy going forward which will include a higher percentage of our system being covered by television advertising communicating a strong value proposition to our guests, thus enabling us to grow our sales and traffic.