Casual-Dining Restaurants See Signs of Hope
by Doug Desjardins
While many fast-food chains have fared well during the recession, casual-dining chains like Cheesecake Factory and BJ’s Restaurants saw sales plummet as diners chose to save money and eat at home. But those diners began to return in January.
Cheesecake Factory reported a 2.7 percent increase in same-restaurant sales for the period ended March 30 and income of $18.7 million. The chain’s Grand Lux Café division had even better results with same-restaurant sales jumping 4 percent.
BJ’s Restaurants reported similar results, with a 4.4-percent increase in same-restaurant sales compared to the same period last year and a 19-percent jump in revenue of $121.7 million.
“During the last two recessionary years, some our competitors adopted a defensive philosophy of saving their way to success,” said Jerry Dietchle, CEO and chairman of BJ’s. “At BJ’s, we continued to prudently invest in new restaurant growth as well as in our food, services, facilities, talent base and infrastructure so that we will be well-positioned to emerge from the recession as an even stronger market-share taker.”
And, according to the NPD Group, BJ’s and other chains may already be emerging from the recession. Its new study of the restaurant industry and consumer trends titled “Light at the End of the Tunnel: What We can Expect,” predicts the restaurant industry is about to emerge from one its worst slumps ever.
“It’s clear from our research and other indicators that consumers are feeling more positive about the economy,” said Bonnie Riggs, NPD’s restaurant industry analyst. “Our survey findings combined with other publicly reported information on the improving status of restaurants suggests a move toward recovery may be starting soon, if it is not already underway.”
Moody’s Investors Services is also showing confidence in the restaurant industry. On April 22, it upgraded the industry from negative to stable. The influential firm said that restaurants should benefit from cost-saving measures they enacted during the past two years, though it said tight credit conditions would keep a cap on any expansion plans for at least another year.
But the NPD Group cautioned that the industry “isn’t out of the woods yet” and noted that restaurant sales for the 14-month period that ended in February were down 3 percent. “Our forecasting model shows that the industry will remain weak for at least another seven months,” said Riggs.
California Pizza Kitchen is a case in point. In its most recent quarter ended in February, it reported a 2.7 percent decline in same-restaurant sales and a 2.7 decline in revenues of $156.7 million. It also indicated it’s exploring the possibility of a sale or a merger.
Before you head out to dinner (or lunch) at a casual-dining restaurant, visit our Printable Coupons page. We've got a whole bunch of restaurant coupons there! And with Mother's Day coming up, there's no better time to plan a dinner out.