Ruth’s Hospitality Group, Inc. (RUTH - Snapshot Report) recently announced the opening of two Ruth's Chris Steak House in the international location of Asia and Central America.
Out of the two, one restaurant has come up in Singapore, marking Ruth's Chris’s 133rd opening. The unit has been opened by the franchisee-owner restaurant group Hasmore Limited, who already owns six Ruth's Chris Steak House in major Asian cities like Tokyo, Hong Kong and Taiwan.
The restaurant is located in the five-star Marina Mandarin Singapore and is spread across approximately 7,800 square feet. Moreover, this new unit will expand the company’s footprints in the Asian market, which is the world's largest and most populated continent.
The second restaurant has been unveiled by a new group, Corporacion Piramide S.A. de C.V, in San Salvador, the capital city of the Republic of El Salvador. San Salvador is also the country’s most populated municipality as well as the most important political, cultural, educational and financial center.
The restaurant is located in the tallest building of the city -- World Trade Center -- consisting of a convention center, office space, hotels, banks and more. The new restaurant is deemed to benefit from its strategic location. This 134th unit also marks the debut of Ruth's Chris in the Central America market. Going forward, the company aims to open additional units in Central America.
Ruth’s, currently operating more than 150 company and franchisee-owned locations worldwide, continues to remain focused on expansion through development. In May 2012, the company opened a new Ruth's Chris Steak House in Cherokee, North Carolina and expects to open a company-owned Ruth’s Chris Steak House in Cincinnati, Ohio in November this year. Additionally, management expects to open one more franchise-owned restaurant in 2012.
The company remains focused on unit growth. In 2013, it expects to open a new company-owned restaurant in Denver, CO and two to three franchised restaurants.
Heathrow, Florida-based Ruth’s reiterated its fiscal 2012 outlook. The company expects cost of goods to be 31.5% to 32.5% of restaurant sales. Further, it expects marketing and advertising expenses to be 3.0% to 3.5% of the total revenue. Capital expenditure for the same period is expected to be in the range of $10 million to $12 million.
Ruth’s currently carries a Zacks #3 Rank that translates into a short-term Hold rating. We are also maintaining our long-term Neutral recommendation on the stock.
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