Brinker International: Reports First Quarter 2017 Results

Dallas / TX. (bi) Brinker International Inc., a recognized leader in casual dining, announced results for the fiscal first quarter ended Sept. 28, 2016. «We remain optimistic about our growth plans despite a choppy first quarter and are seeing traction with stronger comparable restaurant sales for Chili’s in October», said Wyman Roberts, chief executive officer and president. «In the first quarter, the casual dining category was more challenging than we anticipated, but we are gaining share and are rolling out multiple growth platforms – craft beer taps, happy hour, To Go, Plenti points for My Chili’s Rewards loyalty program – that we expect will build through the second half and beyond». Highlights include the following:

• On a GAAP basis, earnings per diluted share decreased 22.2 percent to 0.42 USD compared to 0.54 USD for the first quarter of fiscal 2016
• Earnings per diluted share, excluding special items, decreased 12.5 percent to 0.49 USD compared to 0.56 USD for the first quarter of fiscal 2016
• Brinker’s total revenues decreased 0.5 percent to 758.5 million USD compared to the first quarter of fiscal 2016 and company sales decreased 0.4 percent to 737.4 million USD compared to the first quarter of fiscal 2016
• Chili’s company-owned comparable restaurant sales decreased 1.4 percent
• Maggiano’s comparable restaurant sales decreased 0.6 percent
• Chili’s franchise comparable restaurant sales decreased 0.6 percent, which includes a 1.6 percent decrease for U.S. franchise restaurants, partially offset by an increase of 0.9 percent for international franchise restaurants
• Operating income, as a percent of total revenues, declined approximately 190 basis points to 5.5 percent compared to 7.4 percent for the first quarter of fiscal 2016
• Restaurant operating margin, as a percent of company sales, declined approximately 130 basis points to 13.3 percent compared to 14.6 percent for the first quarter of fiscal 2016
• For the first three months of fiscal 2017, cash flows provided by operating activities were 66.2 million USD and capital expenditures totalled 27.1 million USD. Free cash flow was approximately 39.1 million USD
• The company closed the private offering of 350 million USD of its 5.0 percent senior notes due 2024, entered into a 300 million USD accelerated share repurchase agreement (ASR) and amended the revolving credit agreement to increase the borrowing amount available from 750 million USD to 1 billion USD
• The company spent 350 million USD to repurchase shares including the 300 million USD for the ASR. The company received an initial delivery of approximately 4.6 million shares of common stock pursuant to the ASR agreement and repurchased approximately 1.0 million additional shares of common stock in the open market for a total of 5.6 million shares