Ruby Tuesday (RT)
Q1 2013 Earnings Call
October 10, 2012 5:00 pm ET
Greg Ashley - Vice President of Finance
Samuel E. Beall - Co-Founder, Executive Chairman, Chief Executive Officer and President
Michael O. Moore - Chief Financial Officer, Principal Accounting Officer and Executive Vice President
Daniel P. Dillon - Chief Branding Officer and Executive Vice President
Kimberly M. Grant - Chief Operations Officer and President of Ruby Tuesday Concept
Jeffrey D. Farmer - Wells Fargo Securities, LLC, Research Division
Keith Siegner - Crédit Suisse AG, Research Division
Joseph T. Buckley - BofA Merrill Lynch, Research Division
Peter Saleh - Telsey Advisory Group LLC
Bryan C. Hunt - Wells Fargo Securities, LLC, Research Division
Reza Vahabzadeh - Barclays Capital, Research Division
David Hargreaves - Sterne Agee & Leach Inc., Research Division
Previous Statements by RT
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Thank you, Robin. And thanks to all of you for joining us this evening on our first quarter fiscal '13 earnings call. With me today are Sandy Beall, Ruby Tuesday's Chairman and Chief Executive Officer; Michael Moore, our Executive Vice President and Chief Financial Officer; Dan Dillon, our Executive Vice President of Brand Development; and Kimberly Grant, President of Ruby Tuesday Concept and Chief Operations Officer.
I would like to remind you that there will likely to be forward-looking statements in our comments, and I refer you to the notes regarding forward-looking information in our press release and most recently filed Form 10-K. We plan to release our second quarter fiscal '13 earnings in early January. Our first quarter earnings were released today after the market closed and a copy of our press release can be found on the Investor Relations section of our website at rubytuesday.com, and it's also available on Business Wire, FirstCall and other financial media outlets.
Our format today includes the following: an overview of our first quarter financial results, our fiscal 2013 outlook and a review of our plans and strategies. At the conclusion of our prepared remarks, we will respond to your questions, and I will now turn the call over to Sandy.
Samuel E. Beall
Thanks, Greg. I'd like to welcome all of you listening in this evening on our first quarter earnings call. I'll give you a brief overview of our quarter, and Michael and Greg will provide a financial review as well as a guidance outlook. And then Dan will provide an update on our marketing programs and then Kimberly will provide an overview of our operations plans for Ruby Tuesday, as well as Lime and Marlin & Ray's.
We are very pleased to report positive same-restaurant sales of 1.9% in the first quarter, which is in line with our guidance of approximately 2%. These sales results, our first positive same-restaurant sales in the last 7 quarters, are very encouraging when you consider that we accomplished this in a quarter where we significantly reduced our couponing while supporting and building our television marketing programs. Our balanced approach of television, advertising and promotional activity, in particular -- and in particular, more targeted direct-mail campaign, contributed to our improved sales and traffic trends in the quarter, both of which were very good in our opinion.
Our television marketing program is now more competitive with our peer group and is being largely funded by our $40 million to $50 million of annual cost savings initiatives that we've outlined on the last several earnings calls. In addition, we had lower promotional spending also.
We're also excited to report record high scores on our external brand tracker experience metrics, which Dan and Kimberly will discuss later. But they're just in great shape.
We have much work ahead of us. We know that. We also feel that our business is very stable, more stable than it's been in a couple of years and that gives us a certain sigh of relief, really. We believe the Ruby Tuesday brand is headed in the right direction. We're very focused on maximizing our profits on the incremental sales that we're getting as we move forward.
In addition to progress on the Ruby Tuesday brand, we're also pleased with our progress on Lime Fresh. Lime Fresh is now fully integrated into our company following our April acquisition. And now our focus on this concept is to develop a good pipeline of potential locations in areas such as Florida and Washington, where we can cluster units and build brand recognition. In addition the focusing on sales building initiatives, which we've just started here in the last couple of weeks at our current location. And last comment on that, I guess, is same-store sales for Lime, not a huge base but very encouraging. They're very, very positive, the same-store sales for the first quarter.
On the Marlin & Ray's brand, our focus continues to be on select conversions, building quality operations, trying to build a great, very high-value seafood brand with our sales buildings initiatives.
From a balance sheet standpoint, our company is in very good shape. We have significant excess cash for various uses going forward, which Michael will talk about a little bit, and good flexibility as a result of the recent recapitalization with the $250 million high-yield transaction.
And with that, I'll turn it over to Michael to discuss in more detail our financial results.