Restaurant VIP Card News Article

Fiesta Restaurant Group lowers 2013 sales guidance

15 Mar, 2013 by Restaurant VIP Card staff, via nrn.com

Pollo Tropical parent joins other restaurant companies in lowering guidance, citing economic pressures

Fiesta Restaurant Group Inc., parent to the Pollo Tropical brand, on Thursday joined a small chorus of restaurant companies reducing sales guidance for 2013, citing economic pressure.

The Addison, Texas-based Fiesta lowered its same-store sales forecast for Pollo Tropical revenue, advising that revenue at units open at least a year would rise 3 percent to 5 percent, down from the earlier guidance of a 5-percent to 6-percent increase.

CBased on recent events affecting the restaurant industry and the environment year to date,D Fiesta said in a statement, Cthe company is moderating its comparable restaurant sales growth expectations.D

Fiesta maintained its same-store sales forecast of an increase of 3 percent to 4 percent at its Taco Cabana brand.

Other restaurant companies have lowered guidance in the past month due to economic pressures.

Orlando, Fla.-based Darden Restaurants Inc. warned that blended same-store sales at its Red Lobster, Oliver Garden and LongHorn Steakhouse brands would decrease 1.5 percent to 2.5 percent. However, the company said same-store sales at its specialty concepts, including The Capital Grille, Eddie Vs and Seasons 52, were higher and would help Darden produce a systemwide sales increase of 6 percent to 7 percent for the fiscal year.

Brinker International Inc., Dallas-based parent to the Chilis Grill & Bar and Maggianos Little Italy brands, in late February also revised its full-year guidance downward, saying same-store sales would rise 1 percent for the year, down from earlier guidance of a 2-percent to 3-percent increase. Executives said quarter-to-date same-store sales as of Feb. 24 had fallen 2.2 percent at Chilis and were Cessentially flatD at Maggianos.

While not revising guidance, Louisville, Ky.-based Yum! Brands Inc. said on Monday that same-store sales for its 5,400-unit system in China declined an estimated 20 percent in January and February. Sales in China in 2012 produced more than 40 percent of the operating profit for Yum, which owns and franchises the KFC, Pizza Hut and Taco Bell brands.

In general, the companies expect that estimated cost savings would offset the lowered sales expectations, and they kept revenue figures close to forecasts.

Tim Taft, Fiestas president and chief executive, said in a statement accompanying Thursdays advisory that the company earnings-per-share growth forecast remained at 20 percent. CWe believe this target is achievable,D Taft said, Cdriven by revenue growth related to new restaurant development, increasing comparable restaurant sales and franchise development, complemented by a focus on improving profitability.D

Fiesta also said a lower annual estimated tax rate and a better outlook for cost of sales from price increases would help company revenue in 2013.

Fiesta Restaurant Group has 251 company-owned restaurants and 43 franchised restaurants in the United States, Puerto Rico, the Bahamas, Costa Rica, Ecuador, Honduras, Panama, Trinidad & Tobago and Venezuela.

Contact Ron Ruggless at ronald.ruggless@penton.com.

Follow him on Twitter: @RonRuggless

More Restaurant Network Articles

Domino's Pizza to increase national ad spending
Dominos Pizza Inc. officials said on Thursday that domestic operators would further shift their marketing spending in 2013 to national programs, building on sales momentum from its advertising programs and product introductions of 2012.
Taco Bell leverages crowd sourcing, SXSW for promotion
The quick-service brand partners with two bands for a crowd-sourced documentary film
Einstein Noah to focus on lunch, catering
Company aims to combat sales softness with menu initiatives
Wendy's rolls out new logo systemwide
Move is part of a larger branding overhaul that includes restaurant remodels
Chuck E. Cheese's boosts marketing budget
Parent company CEC Entertainment aims to counter slipping sales