Make us your home page

OSI reports traffic increase, though sales still down at Outback

TAMPA — OSI Restaurant Partners LLC on Friday reported sales gains at three of its restaurant brands, while its anchor, Outback Steakhouse, continued to lag in negative territory.

The casual dining giant nonetheless reported traffic gains in all four of its major chains and said the company is gradually improving performance and "outperformed" the soft recovery spreading across the sit-down, full-service dining industry.

Sales in stores open more than a year — a barometer of a chain's hold on its customer base — were up 1.1 percent at Carrabba's Italian Grill, 3.6 percent at Bonefish Grill and 5.2 percent at the high-end Fleming's Prime Steakhouse and Wine Bar.

Same store sales declined, however, by 2.9 percent at Outback, which accounts for more than half the company's business. That's a marked improvement over the double-digit declines that dogged the chain a year ago.

Overall, OSI revenue slipped to $947 million in the quarter that ended March 31, down from $964 million in the same quarter a year ago. Privately held OSI reported a loss of $1 million, which compared with net income of $82 million a year ago.

The performance came a week after Moody's Investors Service upgraded OSI's debt rating a notch to stable. Moody's noted that OSI's liquidity and debt protections had "improved" enough to support its continuing to pay down debt.

OSI blamed the decline on attempts to gain market share by luring more traffic to Outback with promotional discounts and lower-priced menu choices, and the sale of its Cheeseburger in Paradise unit in 2009.

Going forward, the company is focused heavily on rejuvenating the Outback chain. The company has been testing several new standard store prototypes since last summer in locations from Virginia Beach to Sarasota. Much of its $70 million to $90 million in capital spending this year will go into remodeling about 50 stores.

"This is a year of test and invest to perfect a formula for sustainable comparable store sales growth," said Dirk Montgomery, chief financial officer.

OSI also reported no deal yet since it hired Goldman Sachs to oversee the sale of its Asian development rights in China, plus existing stores in South Korea, Hong Kong and Japan.

Analysts expect the assets to fetch around $300 million. Most of the Asian presence is in Outback Steakhouses in South Korea. Overall, the Asian presence generated net income of $3.3 million on revenue of $240 million in the year that ended Sept. 30.

Reportedly, three private equity funds and CJ Group, a competitive rival among family restaurant chains in South Korea, are in the hunt.

Mark Albright can be reached at or (727) 893-8252.

OSI reports traffic increase, though sales still down at Outback 05/14/10 [Last modified: Friday, May 14, 2010 9:21pm]
Photo reprints | Article reprints

© 2017 Tampa Bay Times


Join the discussion: Click to view comments, add yours

  1. Pinellas construction licensing board needs to be fixed. But how?

    Local Government

    LARGO –– Everyone agrees that the Pinellas County Construction Licensing Board needs to be reformed. But no one agrees on how to do it.

    Rodney Fischer, former executive director of the Pinellas County Construction Licensing Board Rodney, at a February meeting. His management of the agency was criticized by an inspector general's report. [SCOTT KEELER   |   Times]

  2. New owners take over downtown St. Petersburg's Hofbräuhaus


    ST. PETERSBURG — The downtown German beer-hall Hofbräuhaus St. Petersburg has been bought by a partnership led by former Checkers Drive-In Restaurants president Keith Sirois.

    The Hofbrauhaus, St. Petersburg, located in the former historic Tramor Cafeteria, St. Petersburg, is under new ownership.

  3. Boho Hunter will target fashions in Hyde Park


    Boho Hunter, a boutique based in Miami's Wynwood District, will expand into Tampa with its very first franchise.

    Palma Canaria bags will be among the featured items at Boho Hunter when it opens in October. Photo courtesy of Boho Hunter.
  4. Gallery now bringing useful art to Hyde Park customers


    HYDE PARK — In 1998, Mike and Sue Shapiro opened a gallery in St. Petersburg along Central Ave., with a majority of the space dedicated to Sue's clay studio.

     As Sue Shapiro continued to work on her pottery in St. Petersburg, her retail space grew and her studio shrunk. Now Shapiro's is bringing wares like these to Hyde Park Village. Photo courtesy of Shapiro's.
  5. Appointments at Raymond James Bank and Saint Leo University highlight this week's Tampa Bay business Movers & Shakers



    Raymond James Bank has hired Grace Jackson to serve as executive vice president and chief operating officer. Jackson will oversee all of Raymond James Bank's operational business elements, risk management and strategic planning functions. Kackson joins Raymond James Bank after senior …

    Raymond James Bank has hired Grace Jackson to serve as executive vice president and chief operating officer. [Company handout]