UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) November 2, 2015
TEXAS ROADHOUSE, INC.
(Exact name of registrant as specified in its charter)
Delaware |
|
000-50972 |
|
20-1083890 |
(State or other jurisdiction |
|
(Commission |
|
(IRS Employer |
of incorporation) |
|
File Number) |
|
Identification No.) |
6040 Dutchmans Lane, Louisville, KY |
|
40205 |
(Address of principal executive offices) |
|
(Zip Code) |
Registrants telephone number, including area code (502) 426-9984
N/A
(Former name or former address, if changed since last report.)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
ITEM 2.02. RESULTS OF OPERATIONS AND FINANCIAL CONDITION
On November 2, 2015, Texas Roadhouse, Inc. (the Company) issued a press release announcing its financial results for the quarter ended September 29, 2015. Attached to this Current Report on Form 8-K as Exhibit 99.1 is a copy of the press release.
ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS
(d) EXHIBITS
99.1 Press Release issued by the company on November 2, 2015.
The information in this Current Report on Form 8-K at Item 2.02 and the Exhibit attached hereto shall not be deemed to be filed for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section. Such information will not be incorporated by reference into any registration statement filed by the Company under the Securities Act of 1933, as amended, unless specifically identified therein as being incorporated by reference.
2
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
|
TEXAS ROADHOUSE, INC. |
|
|
|
|
Date: November 2, 2015 |
By: |
/s/ Scott M. Colosi |
|
|
Scott M. Colosi |
|
|
President and Chief Financial Officer |
3
INDEX TO EXHIBITS
Exhibit No. |
|
|
|
|
|
99.1 |
|
Press Release issued by the Company on November 2, 2015. |
4
Exhibit 99.1
Texas Roadhouse, Inc. Announces Third Quarter 2015 Results
LOUISVILLE, KY. (November 2, 2015) Texas Roadhouse, Inc. (NasdaqGS: TXRH), today announced financial results for the 13 and 39 week periods ended September 29, 2015.
|
|
Third Quarter |
|
Year to Date |
|
($000s) |
|
2015 |
|
2014 |
|
% Change |
|
2015 |
|
2014 |
|
% Change |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenue |
|
$ |
438,089 |
|
$ |
385,218 |
|
14 |
|
$ |
1,353,017 |
|
$ |
1,177,723 |
|
15 |
|
Income from operations |
|
30,556 |
|
28,821 |
|
6 |
|
110,852 |
|
103,406 |
|
7 |
|
Net income |
|
20,482 |
|
18,881 |
|
8 |
|
73,912 |
|
68,427 |
|
8 |
|
Diluted EPS |
|
$ |
0.29 |
|
$ |
0.27 |
|
8 |
|
$ |
1.05 |
|
$ |
0.97 |
|
8 |
|
Results for the third quarter included the following highlights:
· Comparable restaurant sales increased 6.9% at company restaurants and 7.7% at franchise restaurants;
· Restaurant margin, as a percentage of restaurant sales, decreased 22 basis points to 16.6%, primarily driven by higher labor costs. Wage rate inflation, along with higher healthcare costs, more than offset the impact of higher average unit volume;
· Diluted earnings per share increased 8.0% to $0.29 from $0.27 in the prior year;
· 10 company-owned restaurants were opened, including one Bubbas 33 restaurant; and,
· The Company repurchased 44,000 shares of its common stock for $1.6 million.
Results for year-to-date included the following highlights:
· Comparable restaurant sales increased 8.1% at company restaurants and 7.4% at franchise restaurants;
· Restaurant margin, as a percentage of restaurant sales, decreased 78 basis points to 17.3%. Food cost inflation of approximately 6.0% driven by beef, more than offset the impact of higher average unit volume;
· Diluted earnings per share increased 8.0% to $1.05 from $0.97 in the prior year;
· 22 company-owned restaurants were opened, including four Bubbas 33 restaurants; and,
· The Company repurchased 132,089 shares of its common stock for $4.7 million.
Kent Taylor, Chief Executive Officer of Texas Roadhouse, Inc., commented, We are pleased with our third quarter results, which included double digit revenue growth comprised of solid comparable restaurant sales growth of 6.9% and store week growth of 7.7% from new restaurant development. Our performance continues to be driven by our commitment to legendary food and legendary service.
Taylor continued, Our new restaurant pipeline is strong and we remain on track with our development plans for 2015 and 2016. The consistency of our business and our healthy cash flow generation allows us to fund our new restaurant growth through internal cash flow, while also returning excess capital to our shareholders through dividends and share repurchases, driving further shareholder value.
2015 Outlook
The Company reported that comparable restaurant sales at company restaurants for the first four weeks of its fourth quarter of fiscal 2015 increased approximately 5.0% compared to the prior year period.
Management updated the following expectations for 2015:
· Approximately 30 company restaurant openings, including four Bubbas 33 restaurants (from as many as five Bubbas 33 restaurants previously);
· Food cost inflation of approximately 5.0% (from 4.0% to 4.5% previously);
· An income tax rate of approximately 30.0% to 30.5%, depending on the reinstatement of certain federal tax credits (from 30.0% to 31.0% previously); and,
· Total capital expenditures of approximately $160.0 million (from $145.0 million to $155.0 million previously).
Management reiterated the following expectation for 2015:
· Mid-single digit comparable restaurant sales growth.
2016 Outlook
Management provided the following expectations for 2016:
· Positive comparable restaurant sales growth;
· 25 to 30 company restaurant openings, including at least five Bubbas 33 restaurants;
· Low-single digit food cost deflation;
· An income tax rate of 30.0% to 31.0%, depending on the reinstatement of certain federal tax credits; and,
· Total capital expenditures of $155.0 million to $165.0 million.
Conference Call
The Company is hosting a conference call today, November 2, 2015 at 5:00 p.m. Eastern Time to discuss these results. The dial-in number is (877) 604-9668 or (719) 325-4794 for international calls. A replay of the call will be available for one week following the conference call. To access the replay, please dial (877) 870-5176 or (858) 384-5517 for international calls, and use 2485478 as the pass code. There will be a simultaneous Web cast conducted at www.texasroadhouse.com.
About the Company
Texas Roadhouse is a casual dining concept that first opened in 1993 and today operates over 480 restaurants system-wide in 49 states and four foreign countries. For more information, please visit the Companys Web site at www.texasroadhouse.com.
Forward-looking Statements
Certain statements in this release that are not historical facts, including, without limitation, those relating to our anticipated financial performance, are forward-looking statements that involve risks and uncertainties. Such statements are based upon the current beliefs and expectations of the management of the Company. Actual results may vary materially from those contained in forward-looking statements based on a number of factors including, without limitation, the actual number of restaurants opening; the sales at these and our other company and franchise restaurants; changes in restaurant development or operating costs, such as food and labor; our ability to acquire franchise restaurants; our ability to integrate the franchise restaurants we acquire or other concepts we develop; our ability to continue to generate the necessary cash flows to fund our new restaurant growth, continue our share repurchase program and pay a quarterly cash dividend; strength of consumer
spending; pending or future legal claims; breaches of security; conditions beyond our control such as weather, natural disasters, disease outbreaks, epidemics or pandemics impacting our customers or food supplies; acts of war or terrorism and other factors disclosed from time to time in our filings with the U.S. Securities and Exchange Commission. Investors should take such risks into account when making investment decisions. Shareholders and other readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date on which they are made. We undertake no obligation to update any forward-looking statements.
# # #
Contacts:
Investor Relations
Tonya Robinson
(502) 515-7269
Media
Travis Doster
(502) 638-5457
Texas Roadhouse, Inc. and Subsidiaries
Condensed Consolidated Statements of Income
(in thousands, except per share data)
(unaudited)
|
|
13 Weeks Ended |
|
39 Weeks Ended |
|
|
|
September 29, 2015 |
|
September 30, 2014 |
|
September 29,
2015 |
|
September 30, 2014 |
|
Revenue: |
|
|
|
|
|
|
|
|
|
Restaurant sales |
|
$ |
433,932 |
|
$ |
381,991 |
|
$ |
1,340,917 |
|
$ |
1,167,766 |
|
Franchise royalties and fees |
|
4,157 |
|
3,227 |
|
12,100 |
|
9,957 |
|
|
|
|
|
|
|
|
|
|
|
Total revenue |
|
438,089 |
|
385,218 |
|
1,353,017 |
|
1,177,723 |
|
|
|
|
|
|
|
|
|
|
|
Costs and expenses: |
|
|
|
|
|
|
|
|
|
Restaurant operating costs (excluding depreciation and amortization shown separately below): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of sales |
|
156,643 |
|
137,658 |
|
484,700 |
|
409,552 |
|
Labor |
|
129,198 |
|
112,521 |
|
392,686 |
|
342,375 |
|
Rent |
|
9,325 |
|
8,380 |
|
27,442 |
|
24,550 |
|
Other operating |
|
66,848 |
|
59,276 |
|
204,523 |
|
180,491 |
|
Pre-opening |
|
5,749 |
|
3,945 |
|
14,476 |
|
12,677 |
|
Depreciation and amortization |
|
17,843 |
|
15,164 |
|
50,994 |
|
43,682 |
|
Impairment and closure |
|
|
|
(16 |
) |
|
|
10 |
|
General and administrative |
|
21,927 |
|
19,469 |
|
67,344 |
|
60,980 |
|
|
|
|
|
|
|
|
|
|
|
Total costs and expenses |
|
407,533 |
|
356,397 |
|
1,242,165 |
|
1,074,317 |
|
|
|
|
|
|
|
|
|
|
|
Income from operations |
|
30,556 |
|
28,821 |
|
110,852 |
|
103,406 |
|
|
|
|
|
|
|
|
|
|
|
Interest expense, net |
|
470 |
|
492 |
|
1,480 |
|
1,564 |
|
Equity income from investments in unconsolidated affiliates |
|
449 |
|
410 |
|
1,288 |
|
975 |
|
|
|
|
|
|
|
|
|
|
|
Income before taxes |
|
30,535 |
|
28,739 |
|
110,660 |
|
102,817 |
|
Provision for income taxes |
|
9,141 |
|
9,017 |
|
33,419 |
|
31,462 |
|
|
|
|
|
|
|
|
|
|
|
Net income including noncontrolling interests |
|
$ |
21,394 |
|
$ |
19,722 |
|
$ |
77,241 |
|
$ |
71,355 |
|
Less: Net income attributable to noncontrolling interests |
|
912 |
|
841 |
|
3,329 |
|
2,928 |
|
Net income attributable to Texas Roadhouse, Inc. and subsidiaries |
|
$ |
20,482 |
|
$ |
18,881 |
|
$ |
73,912 |
|
$ |
68,427 |
|
|
|
|
|
|
|
|
|
|
|
Net income per common share attributable to Texas Roadhouse, Inc. and subsidiaries: |
|
|
|
|
|
|
|
|
|
Basic |
|
$ |
0.29 |
|
$ |
0.27 |
|
$ |
1.06 |
|
$ |
0.98 |
|
Diluted |
|
$ |
0.29 |
|
$ |
0.27 |
|
$ |
1.05 |
|
$ |
0.97 |
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares outstanding: |
|
|
|
|
|
|
|
|
|
Basic |
|
70,117 |
|
69,544 |
|
69,995 |
|
69,793 |
|
Diluted |
|
70,735 |
|
70,395 |
|
70,639 |
|
70,639 |
|
Texas Roadhouse, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
(in thousands)
(unaudited)
|
|
September 29, 2015 |
|
December 30, 2014 |
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
72,616 |
|
$ |
86,122 |
|
Other current assets |
|
48,972 |
|
61,604 |
|
Property and equipment, net |
|
723,294 |
|
649,637 |
|
Goodwill |
|
116,571 |
|
116,571 |
|
Intangible assets, net |
|
5,171 |
|
6,203 |
|
Other assets |
|
25,847 |
|
23,005 |
|
|
|
|
|
|
|
Total assets |
|
$ |
992,471 |
|
$ |
943,142 |
|
|
|
|
|
|
|
Current maturities of long-term debt |
|
20,140 |
|
129 |
|
Other current liabilities |
|
195,122 |
|
215,842 |
|
Long-term debt, excluding current maturities |
|
50,587 |
|
50,693 |
|
Other liabilities |
|
61,112 |
|
61,522 |
|
Texas Roadhouse, Inc. and subsidiaries stockholders equity |
|
658,309 |
|
607,892 |
|
Noncontrolling interests |
|
7,201 |
|
7,064 |
|
|
|
|
|
|
|
Total liabilities and equity |
|
$ |
992,471 |
|
$ |
943,142 |
|
Texas Roadhouse, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows
(in thousands)
(unaudited)
|
|
39 Weeks Ended |
|
|
|
September 29, 2015 |
|
September 30, 2014 |
|
|
|
|
|
|
|
Cash flows from operating activities: |
|
|
|
|
|
Net income including noncontrolling interests |
|
$ |
77,241 |
|
$ |
71,355 |
|
Adjustments to reconcile net income to net cash provided by operating activities |
|
|
|
|
|
Depreciation and amortization |
|
50,994 |
|
43,682 |
|
Share-based compensation expense |
|
15,649 |
|
10,937 |
|
Other noncash adjustments |
|
(5,066 |
) |
(1,392 |
) |
Change in working capital |
|
(8,939 |
) |
(7,277 |
) |
Net cash provided by operating activities |
|
129,879 |
|
117,305 |
|
|
|
|
|
|
|
Cash flows from investing activities: |
|
|
|
|
|
Capital expenditures - property and equipment |
|
(123,471 |
) |
(89,645 |
) |
Proceeds from sale of property and equipment, including insurance proceeds |
|
272 |
|
1,197 |
|
Net cash used in investing activities |
|
(123,199 |
) |
(88,448 |
) |
|
|
|
|
|
|
Cash flows from financing activities: |
|
|
|
|
|
Proceeds from revolving credit facility |
|
20,000 |
|
|
|
Repurchase shares of common stock |
|
(4,741 |
) |
(39,966 |
) |
Dividends paid |
|
(34,247 |
) |
(20,923 |
) |
Other financing activities |
|
(1,198 |
) |
(3,535 |
) |
Net cash used in financing activities |
|
(20,186 |
) |
(64,424 |
) |
|
|
|
|
|
|
Net decrease in cash and cash equivalents |
|
(13,506 |
) |
(35,567 |
) |
Cash and cash equivalents - beginning of period |
|
86,122 |
|
94,874 |
|
Cash and cash equivalents - end of period |
|
$ |
72,616 |
|
$ |
59,307 |
|
Texas Roadhouse, Inc. and Subsidiaries
Supplemental Financial and Operating Information
($ amounts in thousands, except weekly sales by group)
(unaudited)
|
|
Third Quarter |
|
Change |
|
Year to Date |
|
Change |
|
|
|
2015 |
|
2014 |
|
vs LY |
|
2015 |
|
2014 |
|
vs LY |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Restaurant openings |
|
|
|
|
|
|
|
|
|
|
|
|
|
Company - Texas Roadhouse |
|
9 |
|
3 |
|
6 |
|
17 |
|
15 |
|
2 |
|
Company - Bubbas 33 |
|
1 |
|
0 |
|
1 |
|
4 |
|
0 |
|
4 |
|
Company - Jaggers |
|
0 |
|
0 |
|
0 |
|
1 |
|
0 |
|
1 |
|
Franchise - Texas Roadhouse |
|
1 |
|
0 |
|
1 |
|
2 |
|
1 |
|
1 |
|
Total |
|
11 |
|
3 |
|
8 |
|
24 |
|
16 |
|
8 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Restaurants open at the end of the quarter |
|
|
|
|
|
|
|
|
|
|
|
|
|
Company - Texas Roadhouse |
|
385 |
|
360 |
|
25 |
|
|
|
|
|
|
|
Company - Bubbas 33 |
|
7 |
|
1 |
|
6 |
|
|
|
|
|
|
|
Company - Jaggers |
|
2 |
|
0 |
|
2 |
|
|
|
|
|
|
|
Franchise - Texas Roadhouse |
|
81 |
|
75 |
|
6 |
|
|
|
|
|
|
|
Total |
|
475 |
|
436 |
|
39 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Company-owned restaurants |
|
|
|
|
|
|
|
|
|
|
|
|
|
Restaurant sales |
|
$ |
433,932 |
|
$ |
381,991 |
|
13.6 |
% |
$ |
1,340,917 |
|
$ |
1,167,766 |
|
14.8 |
% |
Store weeks |
|
5,044 |
|
4,682 |
|
7.7 |
% |
14,834 |
|
13,799 |
|
7.5 |
% |
Comparable restaurant sales growth (1) |
|
6.9 |
% |
5.9 |
% |
|
|
8.1 |
% |
3.9 |
% |
|
|
Texas Roadhouse restaurants only: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Comparable restaurant sales growth (1) |
|
6.9 |
% |
5.9 |
% |
|
|
8.1 |
% |
3.9 |
% |
|
|
Average unit volume (2) |
|
$ |
1,119 |
|
$ |
1,050 |
|
6.6 |
% |
$ |
3,531 |
|
$ |
3,267 |
|
8.1 |
% |
Weekly sales by group: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Comparable restaurants (346 units) |
|
$ |
86,331 |
|
|
|
|
|
|
|
|
|
|
|
Average unit volume restaurants (22 units) (3) |
|
$ |
82,555 |
|
|
|
|
|
|
|
|
|
|
|
Restaurants less than 6 months old (17 units) |
|
$ |
92,082 |
|
|
|
|
|
|
|
|
|
|
|
Restaurant operating costs (as a % of restaurant sales) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of sales |
|
36.1 |
% |
36.0 |
% |
6 |
bps |
36.1 |
% |
35.1 |
% |
108 |
bps |
Labor |
|
29.8 |
% |
29.5 |
% |
32 |
bps |
29.3 |
% |
29.3 |
% |
(3 |
) bps |
Rent |
|
2.1 |
% |
2.2 |
% |
(4 |
) bps |
2.0 |
% |
2.1 |
% |
(6 |
) bps |
Other operating |
|
15.4 |
% |
15.5 |
% |
(11 |
) bps |
15.3 |
% |
15.5 |
% |
(20 |
) bps |
Total |
|
83.4 |
% |
83.2 |
% |
22 |
bps |
82.7 |
% |
81.9 |
% |
78 |
bps |
Restaurant margin (4) |
|
16.6 |
% |
16.8 |
% |
(22 |
) bps |
17.3 |
% |
18.1 |
% |
(78 |
) bps |
Restaurant margin ($ in thousands) |
|
$ |
71,917 |
|
$ |
64,156 |
|
12.1 |
% |
$ |
231,566 |
|
$ |
210,798 |
|
9.9 |
% |
Restaurant margin $/Store week |
|
$ |
14,258 |
|
$ |
13,703 |
|
4.1 |
% |
$ |
15,610 |
|
$ |
15,276 |
|
2.2 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Franchise-owned restaurants |
|
|
|
|
|
|
|
|
|
|
|
|
|
Franchise royalties and fees |
|
$ |
4,157 |
|
$ |
3,227 |
|
28.8 |
% |
$ |
12,100 |
|
$ |
9,957 |
|
21.5 |
% |
Store weeks |
|
1,052 |
|
975 |
|
7.9 |
% |
3,112 |
|
2,912 |
|
6.9 |
% |
Comparable restaurant sales growth (1) |
|
7.7 |
% |
5.2 |
% |
|
|
7.4 |
% |
4.4 |
% |
|
|
Average unit volume (2) |
|
$ |
1,205 |
|
$ |
1,134 |
|
6.2 |
% |
$ |
3,808 |
|
$ |
3,473 |
|
9.6 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pre-opening expense |
|
$ |
5,749 |
|
$ |
3,945 |
|
45.7 |
% |
$ |
14,476 |
|
$ |
12,677 |
|
14.2 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization |
|
$ |
17,843 |
|
$ |
15,164 |
|
17.7 |
% |
$ |
50,994 |
|
$ |
43,682 |
|
16.7 |
% |
As a % of revenue |
|
4.1 |
% |
3.9 |
% |
14 |
bps |
3.8 |
% |
3.7 |
% |
6 |
bps |
General and administrative expenses |
|
$ |
21,927 |
|
$ |
19,469 |
|
12.6 |
% |
$ |
67,344 |
|
$ |
60,980 |
|
10.4 |
% |
As a % of revenue |
|
5.0 |
% |
5.1 |
% |
(5 |
) bps |
5.0 |
% |
5.2 |
% |
(20 |
) bps |
(1) Comparable restaurant sales growth reflects the change in year-over-year sales for restaurants open a full 18 months before the beginning of the period measured, excluding sales from restaurants closed during the period.
(2) Average unit volume includes sales from Texas Roadhouse restaurants open for a full six months before the beginning of the period measured, excluding sales from restaurants closed during the period.
(3) Average unit volume restaurants include Texas Roadhouse restaurants open a full six to 18 months before the beginning of the period measured.
(4) Restaurant margin represents restaurant sales less cost of sales, labor, rent and other operating costs (as a percentage of restaurant sales). Restaurant margin is widely regarded in the restaurant industry as a useful metric by which to evaluate restaurant-level operating efficiency and performance. Restaurant margin is not a measurement determined in accordance with GAAP and should not be considered in isolation, or as an alternative, to income from operations or other similarly titled measures of other companies.
Amounts may not foot due to rounding.
Texas Roadhouse (NASDAQ:TXRH)
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