Chuy’s on Pace to Open 12 New Restaurants in 2016
Chuy’s Holdings, Inc. announced financial results for the third quarter ended September 25.
Highlights for the third quarter were as follows:
Revenue increased 15.8 percent to $85.6 million from $73.9 million in the third quarter of 2015.
Comparable restaurant sales increased 0.3 percent as compared to the same period in 2015.
Steve Hislop, president and chief executive officer of Chuy’s Holdings, Inc. says, “Despite a challenging external environment, our third quarter results included double-digit increases in revenue and diluted net income per share. We were also pleased to continue our consecutive streak of comparable sales growth to 25 quarters despite lapping a strong increase of 4.2 percent in the prior year. We opened three new Chuy’s restaurants during the third quarter and opened one additional restaurant early in the fourth quarter. With 10 restaurants open year-to-date, we are on pace to reach our goal of opening 12 new restaurants for 2016.”
Third Quarter 2016 Financial Results
Revenue increased $11.7 million, or 15.8 percent, to $85.6 million in the third quarter of 2016 compared to the third quarter of 2015. The increase was driven by $13 million in incremental revenue from an additional 166 operating weeks provided by 15 new restaurants opened during and subsequent to the third quarter of 2015. This increase was partially offset by a decrease in revenue related to our non-comparable restaurants that are not included in the incremental revenue discussed above and the loss of seven operating weeks due to the closing of the Charlotte, North Carolina, location during the third quarter of 2016. Revenue for the non-comparable restaurants is historically lower as the restaurants transition out of the “honeymoon” period that follows a restaurant's initial opening.
Comparable restaurant sales increased 0.3 percent in the third quarter of 2016 as compared to the same period in 2015. The increase in comparable sales was driven by a 1.1 percent increase in average check and a 0.8 percent decrease in average weekly customers. The comparable restaurant base consisted of 58 restaurants at the end of the third quarter of 2016.
Total restaurant operating costs as a percentage of revenue increased to 81 percent in the third quarter of 2016 from 79.7 percent in the third quarter of 2015. This increase was primarily driven by higher labor costs as a percentage of revenue due to new store labor inefficiencies and hourly labor rate inflation. The increase was partially offset by a decrease in food costs.
During the third quarter of 2016, the Company incurred $0.4 million of closure costs related to the closing of one restaurant in Charlotte, North Carolina, which is expected to be relocated by the end of the year.
During the third quarter, three new Chuy’s restaurants were opened in Chattanooga, Tennessee, Winter Park, Florida, and San Marcos, Texas. Subsequent to the end of the third quarter, one additional Chuy’s restaurant was opened in Rockville, Maryland.