Ruby Tuesday Guides Second Quarter and Fiscal Year 2012 Earnings Below Consensus

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Last Update: 06-Oct-11 10:55 ET

Ruby Tuesday (RT $7.30 +0.14) reported first quarter earnings of $0.05 per share, excluding non-recurring items, in-line with the Capital IQ Consensus Estimate consensus of $0.05.

Revenues rose 9.2% year/year to $330.3 million versus the $333.9 million consensus.

For the second quarter, the company expects to see earnings of ($0.04) to ($0.08), excluding non-recurring items, versus the $0.05 Capital IQ Consensus Estimate.

For its fiscal year 2012, the company expects earnings of $0.60 to $0.75, excluding non-recurring items, versus the $0.75 Capital IQ Consensus Estimate. Same-Restaurant Sales for Company-owned restaurants will be in the range of flat to down 2.0% for the year.

The company said, "with our second quarter same-restaurant sales estimated to be in the range of down 2.0%-3.0% due to headwinds from the current competitive environment coupled with more difficult sales comparisons to lap from the prior year, and reflecting a two-year trend improvement over the first quarter... We anticipated our first quarter would be challenging, and while our earnings results were within our guidance of $0.03-$0.06 cents per share, we are disappointed with our sales results for the quarter which were below our expectations. We continue to operate in an aggressive competitive promotional environment with very heavy advertising levels and we expect these competitive marketing trends to continue given the soft economy and low consumer confidence. To address these sales issues, we have several initiatives in test that are designed to position our brand favorably with the consumer and help us increase our same-restaurant sales."

Same-restaurant sales decreased 4.1% at Company-owned Ruby Tuesday restaurants, inclusive of approximately 40 basis points of adverse impact from Hurricane Irene.