Fiesta Restaurant Group, Inc. (“Fiesta” or the “Company”) (NASDAQ: FRGI), the owner, operator, and franchisor of the Pollo Tropical® and Taco Cabana® fast-casual restaurant brands, today updated its outlook for 2013.
For 2013, Fiesta has provided the following outlook:
- Comparable restaurant sales growth of 3% to 5% for Pollo Tropical;
- Comparable restaurant sales growth of 3% to 4% for Taco Cabana;
- Cost of sales as a percent of restaurant sales will be approximately even with the prior year, as commodity cost inflation is expected to be offset by pricing and operating initiatives;
- General and administrative expenses of $46 to $48 million, including $2 million of equity-based compensation;
- An effective tax rate of 32% to 34%, including the impact of the reinstatement of the Work Opportunity Tax Credits for 2012 and 2013;
- 14 to 17 new Company-owned restaurants; and
- Capital expenditures of approximately $45 to $50 million.
Based on recent events affecting the restaurant industry and the environment year to date, the Company is moderating its comparable restaurant sales growth expectations. The Company believes this will be offset primarily by an improved outlook for cost of sales and a lower annual estimated effective tax rate, and anticipates delivering earnings per share growth of 20% or greater in 2013 compared to 2012 adjusted earnings per share of $0.60. (1) Fiesta has also established a long-term goal of earnings per share growth in excess of 20%.
Tim Taft, President and Chief Executive Officer of Fiesta, commented, “As we get closer to the anniversary of our first full year as a public company, we think it is important to update our outlook for 2013 and articulate a long-term earnings per share growth target in excess of 20% for the benefit of our shareholders. We believe this target is achievable, driven by revenue growth related to new restaurant development, increasing comparable restaurant sales and franchise development, complemented by a focus on improving profitability.”