Brinker Shares Surge 10 Percent on Solid Results
Brinker International issued its fiscal third-quarter results Monday, posting a better-than-expected 12 percent surge in profits thanks to the success of an overhaul plan which it is currently still implementing. The restaurant operator cited higher margins across its businesses and an increase in traffic and sales at its Chili's Grill & Bar chain. With the moves Brinker has made, gross margin at Chili's improved from 18.3 percent to 18.7 percent in the most recent quarter despite rising costs for commodities like beef, oils and dairy products.
In the three months ended March 28th, Brinker's net income totaled $44.9 million, or 56 cents a share, compared to earnings of $40.2 million in the same period a year earlier. Excluding certain one-time items, earnings came in at 60 cents a share, up from 47 cents a share in the year-ago quarter and surpassing the consensus estimate of 56 cents a share projected by analysts in a recent Reuters survey. Overall revenue across Brinker restaurants, meanwhile, rose 3.5 percent year-over-year to $742 million, ahead of expectations for $730 million in sales.
Since struggling during the recession and the first few years after, Brinker's stock has surged in recent months, gaining 4.3 percent so far this year before Monday's report. Investors celebrated the results on Monday, as the shares surged more than 10 percent despite a broad-based market decline that saw all three major US indexes down about 1 percent with about an hour left in the session.