Red Robin Gourmet Burgers Expects Total Revenues To Grow Around 8.0% In 2016

(RTTNews) - Red Robin Gourmet Burgers, Inc. (RRGB) said that it expects total revenues to grow around 8.0% in 2016, comprised of flat to slightly negative comparable revenue growth, with the remainder due to increased operating weeks associated with locations opened in 2015 and 2016 and acquired restaurants. The Company plans to open approximately 25 new Red Robins and three Burger Works in 2016.

In the pre-market trade, RRGB is currently trading at $58.20, down $3.79 or 6.11%.

Earnings before interest taxes and depreciation or EBITDA is expected to range between $150 million and $155 million in 2016. EBITDA is a non-GAAP number and defined in Schedule III.

Depreciation and amortization is projected to be between $82 million and $84 million in 2016 while interest expense is expected to be approximately $6 million. The 2016 annual tax rate is projected to be approximately 23.0%.

The Company expects capital investments of around $190 million, which includes the 13 restaurants acquired in the first quarter. In addition to new restaurant openings, the Company expects to remodel around 70 locations as part of its Brand Transformation Initiative.

Additionally, a 10 basis point change in restaurant-level operating profit margin is expected to impact earnings per diluted share by approximately $0.09, and a change of approximately $143,000 in pre-tax income or expense is equivalent to approximately $0.01 per diluted share.

Adjusted net income for the sixteen weeks ended April 17, 2016 increased 12.5% to $17.6 million from $15.6 million for the same period a year ago. Excluding the impact of $0.20 per share related to litigation contingencies, and a charge of $0.04 per diluted share for restaurant impairment, adjusted earnings per share for the sixteen weeks ended April 17, 2016 was $1.27, an increase of 15.5% from $1.10 for the same period a year ago.

Net income was $14.2 million compared to $16.6 million last year. GAAP earnings per diluted share was $1.03 compared to $1.16 prior year.

Total Company revenues, which primarily include Company-owned restaurant revenue and franchise royalties, increased 1.8% to $402.1 million in the first quarter of 2016 from $394.9 million in the first quarter of 2015. Restaurant revenues increased $19.6 million due to new restaurant openings and acquired restaurants, partially offset by an $11.0 million, or 2.9%, decrease in comparable restaurant revenue, which included a $1.2 million, or 0.3%, unfavorable foreign exchange impact, and $0.4 million from closed restaurants. Franchise and other revenue decreased $1.0 million, primarily driven by a decrease in gift card breakage revenue from the same period a year ago.

System-wide restaurant revenue (including franchised units) for the first quarter of 2016 totaled $493.0 million, compared to $488.1 million for the first quarter in 2015.

Analysts polled by Thomson Reuters expected the company to report earnings of $1.11 per share and revenues of $415.17 million for the first-quarter. Analysts' estimates typically exclude special items.