Financial Results
Financial results for the 13 and 39 weeks ended
13 Weeks Ended | 39 Weeks Ended | ||||||||||||||||
( | September 26, 2023 | September 27, 2022 | % change | September 26, 2023 | September 27, 2022 | % change | |||||||||||
Total revenue | $ | 1,121,752 | $ | 993,298 | 12.9 | % | $ | 3,467,311 | $ | 3,005,390 | 15.4 | % | |||||
Income from operations | 73,859 | 75,288 | (1.9 | ) | % | 270,216 | 251,344 | 7.5 | % | ||||||||
Net income | 63,788 | 62,328 | 2.3 | % | 232,446 | 209,949 | 10.7 | % | |||||||||
Diluted earnings per share | $ | 0.95 | $ | 0.93 | 2.6 | % | $ | 3.46 | $ | 3.08 | 12.3 | % | |||||
Results for the 13 weeks ended
- Comparable restaurant sales increased 8.2% at company restaurants and increased 7.8% at domestic franchise restaurants;
- Average weekly sales at company restaurants were
$138,668 of which$17,058 were to-go sales as compared to average weekly sales of$129,278 of which$16,305 were to-go sales in the prior year; - Restaurant margin dollars increased 7.1% to
$162.8 million from$152.0 million in the prior year primarily due to higher sales. Restaurant margin, as a percentage of restaurant and other sales, decreased 80 basis points to 14.6% as commodity inflation of 4.2%, wage and other labor inflation of 5.6% and higher general liability insurance expenses were partially offset by higher sales; - Diluted earnings per share increased 2.6% primarily driven by higher restaurant margin dollars and lower income tax expense partially offset by higher depreciation and amortization and higher general and administrative expenses;
- Nine company restaurants and four franchise restaurants were opened including the first Jaggers franchise restaurant; and,
- The Company repurchased 107,593 shares of common stock for
$12.1 million .
Results for the 39 weeks ended
- Comparable restaurant sales increased 10.1% at both company restaurants and domestic franchise restaurants;
- Average weekly sales at company restaurants were
$144,583 of which$18,189 were to-go sales as compared to average weekly sales of$132,356 of which$17,874 were to-go sales in the prior year; - Restaurant margin dollars increased 10.2% to
$531.3 million from$481.9 million in the prior year primarily due to higher sales. Restaurant margin, as a percentage of restaurant and other sales, decreased 73 basis points to 15.4% as commodity inflation of 6.3% and wage and other labor inflation of 6.8% were partially offset by higher sales; - Diluted earnings per share increased 12.3% primarily driven by higher restaurant margin dollars partially offset by higher general and administrative expenses and higher depreciation and amortization expense;
- 18 company restaurants and eight franchise restaurants were opened including the first Jaggers franchise restaurant; and,
- The Company repurchased 414,319 shares of common stock for
$45.2 million .
Morgan continued, “On the development front, we are on track to open a record number of systemwide locations this year across all of our brands. In addition, we have been able to accelerate our 2024 development pipeline and as of the end of the quarter already had 11 of our planned new company locations under construction. Our significant investment in organic growth, along with continued sales momentum, has us well positioned to continue driving legendary value and returns for our roadies, guests and shareholders.”
2023 Outlook
Comparable restaurant sales at company restaurants for the first four weeks of our fourth quarter of fiscal 2023 increased 9.2% compared to 2022. In addition, the Company implemented a menu price increase of approximately 2.7% in early Q4 2023.
Management reiterated the following expectations for 2023:
- Positive comparable restaurant sales growth including the benefit of menu pricing actions;
- Store week growth of approximately 6% including the impact of franchise locations acquired;
- Commodity cost inflation of 5% to 6%; and,
- Wage and other labor inflation of 6% to 7%.
Management updated the following expectations for 2023:
- As many as 27
Texas Roadhouse and Bubba’s 33 company restaurant openings; - An effective income tax rate of approximately 13%; and,
- Total capital expenditures of approximately
$340 million .
2024 Outlook
Management provided the following initial expectations for 2024:
- Positive comparable restaurant sales growth including the benefit of 2023 menu pricing actions;
- Store week growth of approximately 8%, including a benefit of 2% from the 53rd week;
- Commodity cost inflation of 5% to 6%;
- Wage and other labor inflation of 4% to 5%;
- An effective income tax rate of 14% to 15%; and,
- Total capital expenditures of
$340 million to$350 million .
Non-GAAP Measures
The Company prepares the consolidated financial statements in accordance with
Conference Call
Texas Roadhouse, Inc. is hosting a conference call today,
About the Company
Texas Roadhouse, Inc. is a growing restaurant company operating predominantly in the casual dining segment that first opened in 1993 and today has grown to over 720 restaurants system-wide in 49 states and ten foreign countries. For more information, please visit the Company’s Web site at www.texasroadhouse.com.
Forward-looking Statements
Certain statements in this release are forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Securities Exchange Act of 1934, as amended. Such statements are based upon the current beliefs and expectations of the management of
Contacts:
Investor Relations | Media |
(502) 515-7298 | (502) 638-5457 |
Texas Roadhouse, Inc. and Subsidiaries | ||||||||||||||
Consolidated Statements of Income | ||||||||||||||
(in thousands, except per share data) | ||||||||||||||
(unaudited) | ||||||||||||||
13 Weeks Ended | 39 Weeks Ended | |||||||||||||
September 26, 2023 | September 27, 2022 | September 26, 2023 | September 27, 2022 | |||||||||||
Revenue: | ||||||||||||||
Restaurant and other sales | $ | 1,115,224 | $ | 986,999 | $ | 3,447,192 | $ | 2,986,028 | ||||||
Franchise royalties and fees | 6,528 | 6,299 | 20,119 | 19,362 | ||||||||||
Total revenue | 1,121,752 | 993,298 | 3,467,311 | 3,005,390 | ||||||||||
Costs and expenses: | ||||||||||||||
Restaurant operating costs (excluding depreciation and amortization shown separately below): | ||||||||||||||
Food and beverage | 386,184 | 342,032 | 1,198,099 | 1,026,469 | ||||||||||
Labor | 378,814 | 330,219 | 1,155,970 | 985,132 | ||||||||||
Rent | 18,177 | 16,703 | 54,001 | 49,785 | ||||||||||
Other operating | 169,225 | 146,036 | 507,846 | 442,714 | ||||||||||
Pre-opening | 8,663 | 5,701 | 19,711 | 15,315 | ||||||||||
Depreciation and amortization | 39,124 | 33,735 | 112,764 | 101,775 | ||||||||||
Impairment and closure, net | (2 | ) | 772 | 131 | 537 | |||||||||
General and administrative | 47,708 | 42,812 | 148,573 | 132,319 | ||||||||||
Total costs and expenses | 1,047,893 | 918,010 | 3,197,095 | 2,754,046 | ||||||||||
Income from operations | 73,859 | 75,288 | 270,216 | 251,344 | ||||||||||
Interest income (expense), net | 496 | (85 | ) | 2,730 | (877 | ) | ||||||||
Equity income from investments in unconsolidated affiliates | 139 | 190 | 1,181 | 1,069 | ||||||||||
Income before taxes | 74,494 | 75,393 | 274,127 | 251,536 | ||||||||||
Income tax expense | 8,870 | 11,430 | 35,474 | 35,708 | ||||||||||
Net income including noncontrolling interests | 65,624 | 63,963 | 238,653 | 215,828 | ||||||||||
Less: Net income attributable to noncontrolling interests | 1,836 | 1,635 | 6,207 | 5,879 | ||||||||||
Net income attributable to | $ | 63,788 | $ | 62,328 | $ | 232,446 | $ | 209,949 | ||||||
Net income per common share attributable to | ||||||||||||||
Basic | $ | 0.96 | $ | 0.93 | $ | 3.47 | $ | 3.09 | ||||||
Diluted | $ | 0.95 | $ | 0.93 | $ | 3.46 | $ | 3.08 | ||||||
Weighted average shares outstanding: | ||||||||||||||
Basic | 66,779 | 66,886 | 66,923 | 67,875 | ||||||||||
Diluted | 67,014 | 67,159 | 67,179 | 68,140 | ||||||||||
Cash dividends declared per share | $ | 0.55 | $ | 0.46 | $ | 1.65 | $ | 1.38 | ||||||
Texas Roadhouse, Inc. and Subsidiaries | |||||
Condensed Consolidated Balance Sheets | |||||
(in thousands) | |||||
(unaudited) | |||||
September 26, 2023 | December 27, 2022 | ||||
Cash and cash equivalents | $ | 69,324 | $ | 173,861 | |
Other current assets, net | 112,162 | 222,980 | |||
Property and equipment, net | 1,425,169 | 1,270,349 | |||
Operating lease right-of-use assets, net | 679,065 | 630,258 | |||
169,684 | 148,732 | ||||
Intangible assets, net | 4,195 | 5,607 | |||
Other assets | 86,738 | 73,878 | |||
Total assets | $ | 2,546,337 | $ | 2,525,665 | |
Other current liabilities | 561,426 | 652,010 | |||
Operating lease liabilities, net of current portion | 730,163 | 677,874 | |||
Long-term debt | — | 50,000 | |||
Other liabilities | 135,582 | 118,119 | |||
Texas Roadhouse, Inc. and subsidiaries stockholders’ equity | 1,103,956 | 1,012,638 | |||
Noncontrolling interests | 15,210 | 15,024 | |||
Total liabilities and equity | $ | 2,546,337 | $ | 2,525,665 | |
Texas Roadhouse, Inc. and Subsidiaries | |||||||
Condensed Consolidated Statements of Cash Flows | |||||||
(in thousands) | |||||||
(unaudited) | |||||||
39 Weeks Ended | |||||||
September 26, 2023 | September 27, 2022 | ||||||
Cash flows from operating activities: | |||||||
Net income including noncontrolling interests | $ | 238,653 | $ | 215,828 | |||
Adjustments to reconcile net income to net cash provided by operating activities | |||||||
Depreciation and amortization | 112,764 | 101,775 | |||||
Share-based compensation expense | 25,266 | 28,192 | |||||
Deferred income taxes | 2,707 | 5,246 | |||||
Other noncash adjustments, net | 3,672 | 4,191 | |||||
Change in working capital, net of acquisitions | 7,677 | 39,825 | |||||
Net cash provided by operating activities | 390,739 | 395,057 | |||||
Cash flows from investing activities: | |||||||
Capital expenditures - property and equipment | (243,895 | ) | (174,194 | ) | |||
Acquisition of franchise restaurants, net of cash acquired | (39,153 | ) | (33,069 | ) | |||
Proceeds from sale of investments in unconsolidated affiliates | 632 | 316 | |||||
Proceeds from the sale of property and equipment | 1,800 | 2,262 | |||||
Proceeds from sale leaseback transactions | 7,097 | 9,078 | |||||
Net cash used in investing activities | (273,519 | ) | (195,607 | ) | |||
Cash flows from financing activities: | |||||||
Payments on revolving credit facility | (50,000 | ) | (25,000 | ) | |||
Repurchase of shares of common stock | (45,193 | ) | (212,859 | ) | |||
Dividends paid | (110,429 | ) | (93,328 | ) | |||
Other financing activities, net | (16,135 | ) | (18,593 | ) | |||
Net cash used in financing activities | (221,757 | ) | (349,780 | ) | |||
Net decrease in cash and cash equivalents | (104,537 | ) | (150,330 | ) | |||
Cash and cash equivalents - beginning of period | 173,861 | 335,645 | |||||
Cash and cash equivalents - end of period | $ | 69,324 | $ | 185,315 | |||
Reconciliation of Income from Operations to Restaurant Margin | |||||||||||||
(in thousands) | |||||||||||||
(unaudited) | |||||||||||||
13 Weeks Ended | 39 Weeks Ended | ||||||||||||
September 26, 2023 | September 27, 2022 | September 26, 2023 | September 27, 2022 | ||||||||||
Income from operations | $ | 73,859 | $ | 75,288 | $ | 270,216 | $ | 251,344 | |||||
Less: | |||||||||||||
Franchise royalties and fees | 6,528 | 6,299 | 20,119 | 19,362 | |||||||||
Add: | |||||||||||||
Pre-opening | 8,663 | 5,701 | 19,711 | 15,315 | |||||||||
Depreciation and amortization | 39,124 | 33,735 | 112,764 | 101,775 | |||||||||
Impairment and closure, net | (2 | ) | 772 | 131 | 537 | ||||||||
General and administrative | 47,708 | 42,812 | 148,573 | 132,319 | |||||||||
Restaurant margin | $ | 162,824 | $ | 152,009 | $ | 531,276 | $ | 481,928 | |||||
Restaurant margin (as a percentage of restaurant and other sales) | 14.6 | % | 15.4 | % | 15.4 | % | 16.1 | % | |||||
Texas Roadhouse, Inc. and Subsidiaries | |||||||||
Supplemental Financial and Operating Information | |||||||||
($ amounts in thousands, except weekly sales by group) | |||||||||
(unaudited) | |||||||||
13 Weeks Ended | |||||||||
September 26, 2023 | September 27, 2022 | Change | |||||||
Company restaurants (all concepts) | |||||||||
Restaurant and other sales | $ | 1,115,224 | $ | 986,999 | 13.0 | % | |||
Store weeks | 8,032 | 7,600 | 5.7 | % | |||||
Comparable restaurant sales (1) | 8.2 | % | 8.2 | % | |||||
Restaurant operating costs (as a % of restaurant and other sales) | |||||||||
Food and beverage costs | 34.6 | % | 34.7 | % | (3)bps | ||||
Labor | 34.0 | % | 33.5 | % | 51bps | ||||
Rent | 1.6 | % | 1.7 | % | (6)bps | ||||
Other operating | 15.2 | % | 14.8 | % | 38bps | ||||
Total | 85.4 | % | 84.6 | % | |||||
Restaurant margin | 14.6 | % | 15.4 | % | (80)bps | ||||
Restaurant margin ($ in thousands) | $ | 162,824 | $ | 152,009 | 7.1 | % | |||
Restaurant margin $/Store week | $ | 20,272 | $ | 20,001 | 1.4 | % | |||
Store weeks | 7,394 | 7,062 | 4.7 | % | |||||
Comparable restaurant sales (1) | 8.4 | % | 8.2 | % | |||||
Average unit volume (2) | $ | 1,840 | $ | 1,700 | 8.3 | % | |||
Weekly sales by group: | |||||||||
Comparable restaurants (542 and 511 units) | $ | 141,675 | $ | 131,378 | 7.8 | % | |||
Average unit volume restaurants (18 and 23 units) | $ | 138,439 | $ | 125,421 | 10.4 | % | |||
Restaurants less than 6 months old (13 and 11 units) | $ | 141,409 | $ | 143,801 | (1.7 | ) | % | ||
Bubba’s 33 restaurants only: | |||||||||
Store weeks | 547 | 486 | 12.6 | % | |||||
Comparable restaurant sales (1) | 4.8 | % | 6.2 | % | |||||
Average unit volume (2) | $ | 1,437 | $ | 1,395 | 3.0 | % | |||
Weekly sales by group: | |||||||||
Comparable restaurants (36 and 31 units) | $ | 112,447 | $ | 104,669 | 7.4 | % | |||
Average unit volume restaurants (4 and 5 units) | $ | 93,012 | $ | 123,760 | (24.8 | ) | % | ||
Restaurants less than 6 months old (3 and 2 units) | $ | 129,941 | $ | 95,312 | 36.3 | % | |||
Franchise restaurants | |||||||||
Franchise royalties and fees | $ | 6,528 | $ | 6,299 | 3.6 | % | |||
Store weeks | 1,268 | 1,256 | 1.0 | % | |||||
Comparable restaurant sales | 7.1 | % | 7.6 | % | |||||
Comparable restaurant sales | 7.8 | % | 6.7 | % | |||||
Average unit volume | $ | 2,009 | $ | 1,863 | 7.8 | % | |||
(1) Comparable restaurant sales reflect the change in year-over-year sales for restaurants open a full 18 months before the beginning of the period, excluding sales from restaurants permanently closed during the period.
(2) Average unit volume includes sales from restaurants open for a full six months before the beginning of the period, excluding sales from restaurants permanently closed during the period.
Amounts may not foot due to rounding.
Texas Roadhouse, Inc. and Subsidiaries | |||||||||||
Restaurant Unit Activity | |||||||||||
(unaudited) | |||||||||||
13 Weeks Ended | 39 Weeks Ended | ||||||||||
September 26, 2023 | September 27, 2022 | Change | September 26, 2023 | September 27, 2022 | Change | ||||||
Restaurant openings | |||||||||||
Company - | 7 | 4 | 3 | 13 | 11 | 2 | |||||
Company - Bubba’s 33 | 2 | 1 | 1 | 3 | 2 | 1 | |||||
Company - Jaggers | — | — | — | 2 | — | 2 | |||||
Franchise - Texas Roadhouse - Domestic | — | — | — | 1 | — | 1 | |||||
Franchise - Jaggers - Domestic | 1 | — | 1 | 1 | — | 1 | |||||
Franchise - Texas Roadhouse - Int'l | 3 | 2 | 1 | 6 | 5 | 1 | |||||
Total | 13 | 7 | 6 | 26 | 18 | 8 | |||||
Restaurant acquisitions/dispositions | |||||||||||
Company - | — | — | — | 8 | 8 | — | |||||
Franchise - Texas Roadhouse - Domestic | — | — | — | (8 | ) | (8 | ) | — | |||
Restaurant closures | |||||||||||
Franchise - Texas Roadhouse - Domestic | — | — | — | (1 | ) | — | (1 | ) | |||
Restaurants open at the end of the quarter | |||||||||||
Company - | 573 | 545 | 28 | ||||||||
Company - Bubba’s 33 | 43 | 38 | 5 | ||||||||
Company - Jaggers | 7 | 4 | 3 | ||||||||
Franchise - Texas Roadhouse - Domestic | 54 | 62 | (8 | ) | |||||||
Franchise - Jaggers - Domestic | 1 | — | 1 | ||||||||
Franchise - Texas Roadhouse - Int'l | 44 | 36 | 8 | ||||||||
Total | 722 | 685 | 37 |
Source:
2023 GlobeNewswire, Inc., source