Lone Star Steak Guides Lower
Higher beef prices. Lower profit. That's the equation
Lone Star Steakhouse & Saloon
(STAR) - Get iStar Inc. Report
laid out Thursday in its second-quarter earnings guidance.
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The Wichita, Kan.-based restaurant chain said it expects to earn 20 cents to 24 cents a share, citing a 16.7% increase in meat costs for comparable restaurants over the prior year during the first eight weeks of the quarter. In addition, Lone Star said its cost of sales as a percent of revenue will be 2.6% to 3% higher than in the first quarter.
The consensus estimate is for 34 cents a share, according to Thomson First Call.
The company also released same-store sales through May 18, which showed a 1% gain at its flagship chain.
"Higher beef prices will continue to affect our margins significantly," the company said.
Shares closed at $29.75 yesterday.
