Exhibit 99.1

 

Texas Roadhouse, Inc. Announces Third Quarter 2017 Results

 

LOUISVILLE, KY. (October 30, 2017) — Texas Roadhouse, Inc. (NasdaqGS: TXRH), today announced financial results for the 13 and 39 week periods ended September 26, 2017.

 

 

 

Third Quarter

 

Year to Date

 

($000’s)

 

2017

 

2016

 

% Change

 

2017

 

2016

 

% Change

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total revenue

 

$

540,507

 

$

481,637

 

12.2

%

$

1,674,455

 

$

1,506,004

 

11.2

%

Income from operations

 

45,511

 

38,468

 

18.3

%

148,747

 

141,061

 

5.4

%

Net income

 

31,014

 

25,675

 

20.8

%

102,908

 

94,873

 

8.5

%

Diluted EPS

 

$

0.43

 

$

0.36

 

19.9

%

$

1.44

 

$

1.34

 

7.6

%

 

Results for the third quarter included the following highlights:

 

·                  Comparable restaurant sales increased 4.5% at company restaurants and 4.7% at domestic franchise restaurants;

 

·                  Restaurant margin, as a percentage of restaurant sales, decreased 31 basis points to 17.8%, primarily driven by wage rate inflation, partially offset by the benefit of lower food costs;

 

·                  Diluted earnings per share increased 19.9% to $0.43 from $0.36 in the prior year. This includes overlapping a pre-tax charge recorded in the prior year quarter of $1.2 million ($0.8 million after-tax) related to the settlement of a legal matter; and

 

·                  Seven company-owned restaurants, including two Bubba’s 33 restaurants, and one franchise restaurant were opened.

 

Results for the year-to-date period included the following highlights:

 

·                  Comparable restaurant sales increased 4.0% at both company restaurants and domestic franchise restaurants;

 

·                  Restaurant margin, as a percentage of restaurant sales, decreased 28 basis points to 18.9%, primarily driven by wage rate inflation, partially offset by the benefit of lower food costs;

 

·                  A pre-tax charge of $14.9 million ($9.2 million after-tax), or $0.13 per diluted share, was recorded in the first quarter of 2017, related to the settlement of a legal matter.  The impact of the legal charge was partially offset by a pre-tax charge recorded in 2016 of $6.7 million ($4.1 million after-tax) related to a separate legal matter which had an impact of $0.06 on diluted earnings per share;

 

·                  Diluted earnings per share increased 7.6% to $1.44 from $1.34 in the prior year; and

 

·                  20 company-owned restaurants, including four Bubba’s 33 restaurants, and three franchise restaurants were opened.

 

Kent Taylor, Chief Executive Officer of Texas Roadhouse, Inc., commented, “We are pleased to deliver another solid quarter of results including a 19.9% increase in diluted earnings per share driven by double-digit revenue growth.  Comparable restaurant sales grew 4.5%, driven primarily by traffic gains of 3.5%.  In addition, our positive sales momentum has continued into the fourth quarter.  None of this growth would be possible without the commitment from our operators and everyone associated with our legendary brand.”

 

Taylor continued, “As we look to 2018, our balance sheet and strong cashflow have us well positioned for continued growth including approximately 30 planned restaurant openings. In addition, our allocation strategy will continue to be focused on returning capital to shareholders, primarily through our dividend program.”

 



 

2017 Outlook

 

Comparable restaurant sales at company restaurants for the first four weeks of our fourth quarter of fiscal 2017 increased approximately 5.3% compared to the prior year period.

 

Management updated the following expectations for 2017:

 

·                  26 or 27 company restaurant openings (compared to previous guidance of 27 to 29 company restaurant openings), including four Bubba’s 33 restaurants;

 

·                  Food cost deflation of approximately 2.0%, compared to previous guidance of approximately 1.0% to 2.0%; and

 

·                  Labor inflation of approximately 7.0% to 8.0%, compared to previous guidance of mid-single digit inflation.

 

Management reiterated the following expectations for 2017:

 

·                  Positive comparable restaurant sales growth;

 

·                  An income tax rate of approximately 28.0%; and

 

·                  Total capital expenditures of approximately $170.0 million, excluding any cash used for franchise acquisitions.

 

2018 Outlook

 

Management provided the following initial expectations for 2018:

 

·                  Positive comparable restaurant sales growth;

 

·                  Approximately 30 company restaurant openings, including up to seven Bubba’s 33 restaurants;

 

·                  Relatively flat food costs;

 

·                  Mid-single digit labor inflation;

 

·                  An income tax rate of between 28.0% and 29.0%; and

 

·                  Total capital expenditures of approximately $175.0 million, excluding any cash used for franchise acquisitions.

 

Conference Call

 

The Company is hosting a conference call today, October 30, 2017 at 5:00 p.m. Eastern Time to discuss these results.  The dial-in number is (888) 297-0358 or (719) 325-2396 for international calls.  A replay of the call will be available for one week following the conference call.  To access the replay, please dial (844) 512-2921 or (412) 317-6671 for international calls, and use 1901754 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 has grown to over 540 restaurants system-wide in 49 states and six foreign countries.  For more information, please visit the Company’s 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; food safety and food-borne illness concerns; 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 26,

2017

 

September 27,

2016

 

September 26,

2017

 

September 27,

2016

 

 

 

 

 

 

 

 

 

 

 

Revenue:

 

 

 

 

 

 

 

 

 

Restaurant sales

 

$

536,341

 

$

477,617

 

$

1,661,821

 

$

1,493,531

 

Franchise royalties and fees

 

4,166

 

4,020

 

12,634

 

12,473

 

 

 

 

 

 

 

 

 

 

 

Total revenue

 

540,507

 

481,637

 

1,674,455

 

1,506,004

 

 

 

 

 

 

 

 

 

 

 

Costs and expenses:

 

 

 

 

 

 

 

 

 

Restaurant operating costs (excluding depreciation and amortization shown separately below):

 

 

 

 

 

 

 

 

 

Cost of sales

 

176,498

 

161,886

 

545,862

 

506,565

 

Labor

 

169,355

 

145,301

 

514,287

 

442,861

 

Rent

 

11,257

 

10,266

 

33,238

 

30,477

 

Other operating

 

83,679

 

73,583

 

254,176

 

227,082

 

Pre-opening

 

4,548

 

5,017

 

14,302

 

14,253

 

Depreciation and amortization

 

23,534

 

20,941

 

69,236

 

60,718

 

Impairment and closure

 

2

 

13

 

13

 

54

 

General and administrative

 

26,123

 

26,162

 

94,594

 

82,933

 

Total costs and expenses

 

494,996

 

443,169

 

1,525,708

 

1,364,943

 

Income from operations

 

45,511

 

38,468

 

148,747

 

141,061

 

Interest expense, net

 

500

 

288

 

1,211

 

902

 

Equity income from investments in unconsolidated affiliates

 

(359

)

(4

)

(1,149

)

(831

)

Income before taxes

 

45,370

 

38,184

 

148,685

 

140,990

 

Provision for income taxes

 

13,046

 

11,381

 

41,159

 

42,325

 

Net income including noncontrolling interests

 

32,324

 

26,803

 

107,526

 

98,665

 

Less: Net income attributable to noncontrolling interests

 

1,310

 

1,128

 

4,618

 

3,792

 

Net income attributable to Texas Roadhouse, Inc. and subsidiaries

 

$

31,014

 

$

25,675

 

$

102,908

 

$

94,873

 

Net income per common share attributable to Texas Roadhouse, Inc. and subsidiaries:

 

 

 

 

 

 

 

 

 

Basic

 

$

0.44

 

$

0.36

 

$

1.45

 

$

1.35

 

Diluted

 

$

0.43

 

$

0.36

 

$

1.44

 

$

1.34

 

Weighted average shares outstanding:

 

 

 

 

 

 

 

 

 

Basic

 

71,067

 

70,477

 

70,939

 

70,338

 

Diluted

 

71,532

 

70,981

 

71,449

 

70,898

 

Cash dividends declared per share

 

$

0.21

 

$

0.19

 

$

0.63

 

$

0.57

 

 



 

Texas Roadhouse, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets

(in thousands)

(unaudited)

 

 

 

September 26, 2017

 

December 27, 2016

 

Cash and cash equivalents

 

$

114,436

 

$

112,944

 

Other current assets

 

50,893

 

87,315

 

Property and equipment, net

 

886,972

 

830,054

 

Goodwill

 

121,040

 

116,571

 

Intangible assets, net

 

2,930

 

3,622

 

Other assets

 

36,448

 

29,465

 

 

 

 

 

 

 

Total assets

 

$

1,212,719

 

$

1,179,971

 

 

 

 

 

 

 

Current maturities of long-term debt and obligation under capital lease

 

9

 

167

 

Other current liabilities

 

238,260

 

279,360

 

Long-term debt and obligation under capital lease, excluding current maturities

 

51,984

 

52,381

 

Other liabilities

 

91,674

 

89,821

 

Texas Roadhouse, Inc. and subsidiaries stockholders’ equity

 

818,743

 

750,226

 

Noncontrolling interests

 

12,049

 

8,016

 

 

 

 

 

 

 

Total liabilities and equity

 

$

1,212,719

 

$

1,179,971

 

 



 

Texas Roadhouse, Inc. and Subsidiaries

Condensed Consolidated Statements of Cash Flows

(in thousands)

(unaudited)

 

 

 

39 Weeks Ended

 

 

 

September 26, 2017

 

September 27, 2016

 

Cash flows from operating activities:

 

 

 

 

 

Net income including noncontrolling interests

 

$

107,526

 

$

98,665

 

Adjustments to reconcile net income to net cash provided by operating activities

 

 

 

 

 

Depreciation and amortization

 

69,236

 

60,718

 

Share-based compensation expense

 

18,826

 

18,347

 

Other noncash adjustments

 

(2,702

)

1,321

 

Change in working capital

 

(4,816

)

(19,269

)

Net cash provided by operating activities

 

188,070

 

159,782

 

 

 

 

 

 

 

Cash flows from investing activities:

 

 

 

 

 

Capital expenditures - property and equipment

 

(117,037

)

(113,219

)

Acquisition of franchise restaurants, net of cash acquired

 

(16,528

)

 

Net cash used in investing activities

 

(133,565

)

(113,219

)

 

 

 

 

 

 

Cash flows from financing activities:

 

 

 

 

 

Proceeds from revolving credit facility, net

 

 

25,000

 

Repurchase shares of common stock

 

 

(4,110

)

Dividends paid

 

(43,223

)

(38,656

)

Other financing activities

 

(9,790

)

(6,418

)

Net cash used in financing activities

 

(53,013

)

(24,184

)

 

 

 

 

 

 

Net increase in cash and cash equivalents

 

1,492

 

22,379

 

Cash and cash equivalents - beginning of period

 

112,944

 

59,334

 

Cash and cash equivalents - end of period

 

$

114,436

 

$

81,713

 

 



 

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

 

 

 

2017

 

2016

 

vs LY

 

2017

 

2016

 

vs LY

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Restaurant openings

 

 

 

 

 

 

 

 

 

 

 

 

 

Company - Texas Roadhouse

 

5

 

5

 

0

 

16

 

16

 

0

 

Company - Bubba’s 33

 

2

 

2

 

0

 

4

 

5

 

(1

)

Company - Other

 

0

 

0

 

0

 

0

 

0

 

0

 

Franchise - Texas Roadhouse - U.S.

 

0

 

1

 

(1

)

1

 

1

 

0

 

Franchise - Texas Roadhouse - International

 

1

 

0

 

1

 

2

 

2

 

0

 

Total

 

8

 

8

 

0

 

23

 

24

 

(1

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Restaurant acquisitions/dispositions

 

 

 

 

 

 

 

 

 

 

 

 

 

Company - Texas Roadhouse

 

0

 

0

 

0

 

4

 

0

 

4

 

Company - Bubba’s 33

 

0

 

0

 

0

 

0

 

0

 

0

 

Company - Other

 

0

 

0

 

0

 

0

 

0

 

0

 

Franchise - Texas Roadhouse

 

0

 

0

 

0

 

(4

)

0

 

(4

)

Total

 

0

 

0

 

0

 

0

 

0

 

0

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Restaurants open at the end of the quarter

 

 

 

 

 

 

 

 

 

 

 

 

 

Company - Texas Roadhouse

 

433

 

408

 

25

 

 

 

 

 

 

 

Company - Bubba’s 33

 

20

 

12

 

8

 

 

 

 

 

 

 

Company - Other

 

2

 

2

 

0

 

 

 

 

 

 

 

Franchise - Texas Roadhouse - U.S.

 

70

 

73

 

(3

)

 

 

 

 

 

 

Franchise - Texas Roadhouse - International

 

15

 

12

 

3

 

 

 

 

 

 

 

Total

 

540

 

507

 

33

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Company-owned restaurants

 

 

 

 

 

 

 

 

 

 

 

 

 

Restaurant sales

 

$

536,341

 

$

477,617

 

12.3

%

$

1,661,821

 

$

1,493,531

 

11.3

%

Store weeks

 

5,868

 

5,427

 

8.1

%

17,324

 

16,039

 

8.0

%

Comparable restaurant sales growth (1)

 

4.5

%

3.4

%

 

 

4.0

%

4.2

%

 

 

Texas Roadhouse restaurants only:

 

 

 

 

 

 

 

 

 

 

 

 

 

Comparable restaurant sales growth (1)

 

4.6

%

3.5

%

 

 

4.0

%

4.2

%

 

 

Average unit volume (2)

 

$

1,197

 

$

1,152

 

3.9

%

$

3,776

 

$

3,663

 

3.1

%

Weekly sales by group:

 

 

 

 

 

 

 

 

 

 

 

 

 

Comparable restaurants (396 units)

 

$

92,712

 

 

 

 

 

 

 

 

 

 

 

Average unit volume restaurants (21 units) (3)

 

$

79,891

 

 

 

 

 

 

 

 

 

 

 

Restaurants less than 6 months old (16 units)

 

$

93,419

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Restaurant operating costs (as a % of restaurant sales)

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of sales

 

32.9

%

33.9

%

(99

)bps

32.8

%

33.9

%

(107

)bps

Labor

 

31.6

%

30.4

%

115

bps

30.9

%

29.7

%

130

bps

Rent

 

2.1

%

2.1

%

(5

)bps

2.0

%

2.0

%

(4

)bps

Other operating

 

15.6

%

15.4

%

20

bps

15.3

%

15.2

%

9

bps

Total

 

82.2

%

81.9

%

31

bps

81.1

%

80.8

%

28

bps

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Restaurant margin (4)

 

17.8

%

18.1

%

(31

)bps

18.9

%

19.2

%

(28

)bps

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Restaurant margin ($ in thousands) (4)

 

$

95,552

 

$

86,581

 

10.4

%

$

314,258

 

$

286,546

 

9.7

%

Restaurant margin $ (4)/Store week

 

$

16,284

 

$

15,953

 

2.1

%

$

18,140

 

$

17,866

 

1.5

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Franchise-owned restaurants

 

 

 

 

 

 

 

 

 

 

 

 

 

Franchise royalties and fees

 

$

4,166

 

$

4,020

 

3.6

%

$

12,634

 

$

12,473

 

1.3

%

Store weeks

 

1,092

 

1,095

 

(0.3

)%

3,264

 

3,253

 

0.3

%

Comparable restaurant sales growth (1)

 

2.8

%

1.9

%

 

 

2.9

%

2.5

%

 

 

U.S. franchise restaurants only:

 

 

 

 

 

 

 

 

 

 

 

 

 

Comparable restaurant sales growth (1)

 

4.7

%

3.3

%

 

 

4.0

%

3.9

%

 

 

Average unit volume (2)

 

$

1,227

 

$

1,163

 

5.5

%

$

3,862

 

$

3,717

 

3.9

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pre-opening expense

 

$

4,548

 

$

5,017

 

(9.3

)%

$

14,302

 

$

14,253

 

0.3

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization

 

$

23,534

 

$

20,941

 

12.4

%

$

69,236

 

$

60,718

 

14.0

%

As a % of revenue

 

4.4

%

4.3

%

1

bp

4.1

%

4.0

%

10

bps

 

 

 

 

 

 

 

 

 

 

 

 

 

 

General and administrative expenses

 

$

26,123

 

$

26,162

 

(0.1

)%

$

94,594

 

$

82,933

 

14.1

%

As a % of revenue

 

4.8

%

5.4

%

(60

)bps

5.6

%

5.5

%

14

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 any sales at restaurants closed during the period.

(3)  Average unit volume restaurants include restaurants open a full six and up to 18 months before the beginning of the period measured.

(4)  Restaurant margin (in dollars and as a percentage of restaurant sales) represents restaurant sales less restaurant operating costs, including cost of sales, labor, rent and other operating costs.  Depreciation and amortization expense, substantially all of which relates to restaurant-level assets, is excluded from restaurant operating costs.  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.

 


View differences made from one to another to evaluate Texas Roadhouse, Inc.'s financial trajectory

Compare SEC Filings Year-over-Year (YoY) and Quarter-over-Quarter (QoQ)
Sample 10-K Year-over-Year (YoY) Comparison

Compare this 8-K Corporate News to its predecessor by reading our highlights to see what text and tables were  removed  ,   added    and   changed   by Texas Roadhouse, Inc..

Continue

Never Miss A New SEC Filing Again


Real-Time SEC Filing Notifications
Screenshot taken from Gmail for a new 10-K Annual Report
Last10K.com Member Feature

Receive an e-mail as soon as a company files an Annual Report, Quarterly Report or has new 8-K corporate news.

Continue

We Highlighted This SEC Filing For You


SEC Filing Sentiment Analysis - Bullish, Bearish, Neutral
Screenshot taken from Wynn's 2018 10-K Annual Report
Last10K.com Member Feature

Read positive and negative remarks made by management in their entirety without having to find them in a 10-K/Q.

Continue

Widen Your SEC Filing Reading Experience


Increased Reading Area for SEC Filings
Screenshot taken from Adobe Inc.'s 10-Q Quarterly Report
Last10K.com Member Feature

Remove data columns and navigations in order to see much more filing content and tables in one view

Continue

Uncover Actionable Information Inside SEC Filings


SEC Filing Disclosures
Screenshot taken from Lumber Liquidators 10-K Annual Report
Last10K.com Member Feature

Read both hidden opportunities and early signs of potential problems without having to find them in a 10-K/Q

Continue

Adobe PDF, Microsoft Word and Excel Downloads


Download Annual and Quarterly Reports as PDF, Word and Excel Documents
Screenshots of actual 10-K and 10-Q SEC Filings in PDF, Word and Excel formats
Last10K.com Member Feature

Export Annual and Quarterly Reports to Adobe PDF, Microsoft Word and Excel for offline viewing, annotations and analysis

Continue

FREE Financial Statements


Download Annual and Quarterly Reports as PDF, Word and Excel Documents
Screenshot of actual balance sheet from company 10-K Annual Report
Last10K.com Member Feature

Get one-click access to balance sheets, income, operations and cash flow statements without having to find them in Annual and Quarterly Reports

Continue for FREE

Intrinsic Value Calculator


Intrinsic Value Calculator
Screenshot of intrinsic value for AT&T (2019)
Last10K.com Member Feature

Our Intrinsic Value calculator estimates what an entire company is worth using up to 10 years of financial ratios to determine if a stock is overvalued or not

Continue

Financial Stability Report


Financial Stability Report
Screenshot of financial stability report for Coco-Cola (2019)
Last10K.com Member Feature

Our Financial Stability reports uses up to 10 years of financial ratios to determine the health of a company's EPS, Dividends, Book Value, Return on Equity, Current Ratio and Debt-to-Equity

Continue

Get a Better Picture of a Company's Performance


Financial Ratios
Available Financial Ratios
Last10K.com Member Feature

See how over 70 Growth, Profitability and Financial Ratios perform over 10 Years

Continue

Log in with your credentials

or    

Forgot your details?

Create Account