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Investors in Brinker Breathe Sigh Of Relief As Q2 Results Look Solid

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Shares of Brinker International, Inc (NYSE: EAT) are up more than 6 percent Wednesday afternoon following better-than-expected second-quarter results this morning.

The company reported quarterly net income of $39.74 million, up nearly 7 percent from the same quarter last year. On a per-share basis, profit grew by 16 percent from $0.50 during Brinker's second quarter of 2013 to $0.58. Excluding special items, earnings totaled $0.59 per share, up 18 percent from $0.50 in EPS last year.

Brinker said earnings were helped by cost cutting measures at Chili's Grill & Bar and Maggiano's Little Italy restaurants.

Revenue for the quarter was $704.39 million, up slightly more than 2 percent from $689.76 million in the second quarter of last year.

The company's same-store sales during the period were up 0.8 percent; comps at Chili's company-owned locations were up 0.7 percent while traffic declined 1.9 percent while comps at Maggiano's were up 0.9 percent. Brinker highlighted international strength in Chili's, saying comps were up 1.4 percent, the 16th consecutive quarter of increases.

Guidance Brinker made no mention of changes to the previously-issued guidance.

CEO Commentary CEO and president of Brinker, Wyman Roberts, commented: ”We remain encouraged about the trajectory of our business as results from this past quarter demonstrate our steady progress of driving top-line sales, while increasing value for our shareholders.”

Analyst Commentary In a research note from Miller Tabak's Stephen Anderson, the analyst highlighted earnings as inline but said he is "encouraged" by a return to positive same-store sales "at both Chili's and Maggiano's for the first time in a year." Anderson speculates, "the only reason EAT's earnings were in line in 2Q14 was that the company was not as aggressive on share buybacks as it has been in recent quarters..."

The Miller Tabak analyst sees positive momentum at Brinker continuing through the second half of 2014. The firm currently rates Brinker shares with a Buy rating and $50 price target.

With about three hours left in the trading session, shares of Brinker last traded at $49.63.

Posted-In: Analyst Color Earnings News Retail Sales Analyst Ratings Movers

 

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