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The results represent a net earnings increase well above the $285,000, or 1 cent per share, recorded for the same period a year ago.
"We think we are out of the crisis mode. We are running the business a little more aggressively. It's not about survival like it was last spring," Ruby Tuesday founder and CEO Sandy Beall said Wednesday during a conference call with analysts.
Sales at domestic and international franchise Ruby Tuesday restaurants totaled $94.8 million in first quarter 2010 versus $99.7 million in the same quarter in 2009.
Total revenue fell 7.2 percent to $300.6 million, which was attributed to 45 fewer restaurants in operation and a decrease in same-store sales, or sales at restaurants open at least a year and considered the most accurate measure of revenue.
Despite a decline in same-store sales of 3.1 percent and 6.5 percent at company-owned and franchise stores compared to the same period last quarter, customer traffic at Ruby Tuesday locations is increasing.
Beall said the company is focusing "great intensity" on increasing the number of folks who come to dine at Ruby Tuesday restaurants.
"We are very aggressively going after traffic and we're getting it," Beall said, noting heavy investments on value, including recent buy one get one free promotions. The average check is $11.50 at the chain's restaurants.
Beall also pointed to new offerings like the introduction of a Sunday brunch and lobster on the menu as well as the addition of microbrews and premium wines. A new menu, which Beall described as "by far the best menu ever," will roll out Nov. 3.
"What's key to this, we believe anyway, it's the new brand, the fresh new look. It's the people, the food, the menu. It's such a wow to them they're coming back, and when they see one of our incentives they want to use it because of the experience they've had," Beall said.
Ruby Tuesday remodeled all of its stores as part of a strategy to create an upscale image and evolve from the 1980s and 1990s bar-and-grill style restaurants.
No new company-owned restaurants will be opened this fiscal year and 15 are projected to close when their leases expire. The company expects six franchise restaurants to open, including three international stores.
Same-store sales are expected to continue to fall in the range of 1 percent to 3 percent. The company's forecast for profit for the year is in the range of 50 to 60 cents per share.
During Ruby Tuesday's 2009 annual meeting Wednesday at the company's Maryville headquarters, shareholders voted to re-elect three Class II directors to the board for three-year terms. They are Kevin Clayton, 46, president and CEO of Clayton Homes Inc., Claire Arnold, 62, CEO of Leapfrog Services Inc., and Dr. Donald Ratajczak, 66, a consulting economist for businesses and governmental agencies.
Shareholders also ratified the selection of KPMG LLP to serve as Ruby Tuesday's independent registered public accounting firm for the fiscal year ending June 1, 2010.
As of Sept. 1, Ruby Tuesday owned and operated 670 restaurants with another 226 franchise locations.
Business writer Carly Harrington may be reached at 865-342-6317.
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