Dallas-based Brinker International reported a solid financial performance in the second quarter of its fiscal year, despite weakness in the overall economic climate during the quarter.
Brinker, a leader in the casual dining industry, saw its earnings per share increase 9.4% for the company’s second quarter ended 26 December 2001.
Brinker reported second quarter revenues for the 13-week period of US$704.7m, an increase of 20.8% over the US$583.3m reported for the same period of fiscal 2001. These revenue gains were driven primarily by a combination of capacity gains of 19.9% and overall comparable same store sales among all Brinker concepts, which were up 1.6% during the quarter.
Comparable same store sales were up 2.5% at Chili’s and 0.8% at On The Border. Comparable same store sales were down 0.2% at Macaroni Grill. Net income for the second quarter of fiscal 2002 was US$34.6m, which resulted in diluted earnings per share of US$0.35 as compared to US$0.32 per share reported in the same quarter of fiscal 2001.
Revenues for the 26-week period rose 19% to US$1,395.2 from US$1,172.5m reported for the same period last fiscal year. Net income for the 26-week period increased 10.2% from US$67.4m to US$74.3m. Diluted earnings per share for the 26-week period of fiscal 2002 increased 12.1% from US$0.66 to US$0.74.
“I feel very positive about our decision to stay the course in view of the challenging times, and to aggressively pursue our vision of the future,” said Ron McDougall, Chairman and CEO. “The quality of the concepts in our portfolio and their potential expansion targets foreshadows exciting times ahead.”
On 14 November 2001, the company completed the purchase of 39 Chili’s Grill & Bar restaurants previously operated by franchisee Sydran Group, LLC. The acquisition also included the future development rights for Chili’s in all or portions of 14 states in the Western United States.
Brinker estimates third quarter earnings per share for fiscal 2002 to be US$0.39 to US$0.41, and earnings for the fiscal year 2002 to be US$1.62 to US$1.64. These estimates are based on expectations of comparable same store sales growth of 0 to 2%.
The company continues to be active in its share repurchase program, acquiring approximately 1,981,000 shares during the second quarter. Since the inception of its share repurchase program, the company has purchased almost US$279m of its common stock.
At the end of the second quarter, Brinker International either owned, operated, franchised, or was involved in the ownership of 1,208 restaurants under the names Chili’s Grill & Bar, Romano’s Macaroni Grill, On The Border Mexican Grill & Cantina, Cozymel’s Coastal Mexican Grill, Maggiano’s Little Italy, Corner Bakery Cafe, Big Bowl, Rockfish Seafood Grill, and Eatzi’s Market and Bakery.