In a March 10th release, Red Robin Gourmet Burgers Inc. (RRGB) posted financial results for the 4th quarter and fiscal 2021 ending December 26th 2021. This company is at the interface between a QSR and family dining in concept. This is a challenging space having endured two years of COVID restrictions, limiting restaurant patronage especially by families. More recently inflation and financial concerns have impacted the family dining demographic. Along with other competitors, Red Robin is subject to increased costs for food, packaging and labor in an environment still restrained by COVID.
Red Robin has a history of losses but the results for Q4 can be characterized as “less bad” with increased revenue offsetting fixed costs and with enhanced off-premises sales. Red Robin fell short of Street estimates on both top and bottom lines. For the 4th Quarter of FY 2021 ending December 26th, net loss was $(21.3) million on total revenue of $283.3 million. Comparable figures for the 4th quarter of fiscal 2020 ending December 27th 2020 were a net loss of $(39.3) million on total revenue of $195.5 million. Diluted EPS improved from $(2.53) for the 4th quarter of fiscal 2020 to $(1.36) for the most recent quarter. For the quarter, revenue increased by 40.9 percent compared to Q4 of FY 2020 attributed to a 26.6 percent increase in guest count and 13.5 percent increase in checks.
For FY 2021 net loss was $(50.0) million on revenue of $1,162 million comparing favorably to a net loss of $(276.1) on revenue of $886.7 million for FY 2020 impacted by COVID. Diluted EPS for FY 2021 attained $(3.19) compared to $(19.29) for FY 2020.
In commenting on results Paul J. B. Murphy III, president and CEO, stated, "As the Omicron variant has receded in recent weeks, we are seeing encouraging signs that our business is beginning to normalize with improved staffing levels across our system, growing dine-in sales and sustained off-premises volumes. We remain intently focused on continuing to strengthen our staffing levels and reducing operational complexity to deliver a memorable quality Guest experience and meet the increasing level of demand as Guests are returning to our restaurants.”
Murphy added, “We remain confident in our execution of our four strategic pillars which focus on being the employer of choice in the industry; delivering a variety of gourmet burgers and mainstream favorites; creating relevant, personalized and memorable guest experiences and executing our growth platforms. Discretionary capital in 2022 will be allocated to our growth platforms that create meaningful value to our shareholders, including Donatos®, our digital ecosystem and operational and restaurant enhancements.”
On December 26th 2021, RRGB posted assets of $929 million of which $21.3 million comprised goodwill and intangibles. The Company carried long-term debt and lease obligations of $628.7 million against an intraday market capitalization of $280.9 million on March 17th. RRGB has ranged over a 52-week period from $12.35 to $41.34 with a 50-day moving average of $15.91. Twelve-month trailing operating margin was -1.8 percent and profit margin -4.3 percent. Return on assets over the past twelve months was -1.4 percent and the return on equity -50.6 percent. At close of trading on March 10th pre-release, RRGB was priced at $13.93. At market close, post-release on March 11th RRGB closed at $15.90.