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Brinker International, Inc. (EAT - Free Report) reported second-quarter fiscal 2025 results, with earnings and revenues beating the Zacks Consensus Estimate. Both top and bottom lines increased from the prior-year reported figures.
Find the latest earnings estimates and surprises on Zacks Earnings Calendar.
The company's quarterly performance benefited from strong fundamentals, leading to better guest experience and steady business growth. Higher comparable restaurant sales at Chili’s drove the top line as both new and returning guests visited more frequently despite a competitive market.
Following the results, the company’s shares rose 12.5% in today’s pre-market trading session. Positive investor sentiments were witnessed as the company raised its guidance for fiscal 2025.
EAT’s Q2 Earnings and Revenues
In the quarter under review, Brinker reported adjusted earnings per share (EPS) of $2.80, which beat the Zacks Consensus Estimate of $1.80. The company reported an EPS of 99 cents in the prior-year quarter.
Brinker International, Inc. Price, Consensus and EPS Surprise
In the fiscal second quarter, total revenues of $1.36 billion outpaced the consensus mark of $1.24 billion. The top line increased 26.5% on a year-over-year basis. EAT gained from the solid performance of Chili's.
Chili's
In the fiscal second quarter, revenues in the Chili’s segment rose 30.4% year over year to $1.21 billion. This upside was backed by favorable comparable restaurant sales, driven by menu pricing, higher traffic and a favorable menu item mix. Our model predicted segmental revenues at $1.01 billion.
Chili's restaurant expenses (as a percentage of company sales) in the fiscal second quarter were 81.3%, down from 88.4% in the prior-year quarter. This downside was caused by sales leverage, partially overshadowed by an increase in hourly labor, repairs and maintenance expenses, higher manager salaries and bonus, and unfavorable commodity costs.
Chili's company-owned traffic rose 19.9% year over year in the quarter under discussion. The metric fell 0.6% in the prior-year quarter.
The segment’s company-owned comps rose 31.4% in the fiscal second quarter from the year-ago quarter’s levels.
At Chili’s, domestic comps (including company-owned and franchised) gained 30.8% compared with a 5.1% rise reported in the prior-year period.
Maggiano’s
Maggiano’s sales in the fiscal second quarter increased 1.7% year over year to $149.4 million. Our model predicted segmental revenues at $151.2 million. Favorable comparable restaurant sales, courtesy of increased menu pricing, drove this upside. However, this was partially offset by lower traffic. Comps in the segment rose 1.8% year over year. Our prediction was 3%.
Traffic in the quarter under discussion fell 4.9% year over year. The metric was down 4.2% in the prior-year quarter.
Maggiano's company restaurant expenses (as a percentage of company sales) in the fiscal second quarter were 77.3%, marginally up from 77.1% a year ago. This upside was caused by increased advertising expense, management salary, repairs and maintenance, and unfavorable commodity costs. However, this was partially offset by sales leverage and lower hourly labor.
EAT’s Operating Results
In the quarter under review, total operating costs and expenses were $1.20 billion, up from $1.01 billion reported in the year-ago quarter. Adjusted restaurant operating margin, as a percentage of company sales, was 19.1%, up from 13.1% reported in the prior-year quarter.
Adjusted EBITDA in the fiscal second quarter was $215.8 million. The figure was up from $107 million reported in the prior-year quarter.
Balance Sheet of EAT
As of Dec. 25, 2024, cash and cash equivalents amounted to $14.8 million compared with $22.7 million as of Dec. 25, 2023. As of Dec. 25, long-term debt (less current installments) was $625 million compared with $786.3 million as of June 26, 2024.
EAT’s Fiscal 2025 Guidance Raised
In fiscal 2025, management anticipates total revenues to be in the range of $5.15-$5.25 billion compared with the previous expectation of $4.70-$4.75 billion. Capital expenditures are expected in the $240-$260 million band, up from prior expectation of $195-$215 million. EAT anticipates fiscal 2025 EPS in the range of $7.5-$8, up from the prior estimate of $5.2-$5.5.
Fastenal Company (FAST - Free Report) reported lower-than-expected fourth-quarter 2024 results, with earnings and net sales lagging the Zacks Consensus Estimate. On a year-over-year basis, the top line rose while the bottom line remained flat.
Growth in sales was primarily driven by the expansion of Onsite locations, which cater directly to customer facilities, and increased adoption of the company’s digital platforms. However, FAST faced significant challenges, including a soft manufacturing environment throughout 2024. A weakened demand, particularly for fasteners, a core product category, further affected growth. Nonetheless, its focus on strategic initiatives like digital transformation and customer-centric services is expected to bolster its long-term market position despite short-term challenges.
Darden Restaurants, Inc. (DRI - Free Report) reported second-quarter fiscal 2025 results, with earnings missing the Zacks Consensus Estimate and revenues beating the same. The top and bottom lines increased on a year-over-year basis.
The quarter’s sales inched up 6% from the prior-year quarter’s level. The upside was backed by a blended same-restaurant sales increase of 2.4%. Also, contributions from 103 Chuy's restaurants and 39 net new restaurants added to the positives. Same-restaurant sales growth in fiscal 2025 is anticipated to be 1.5% year over year. Also, EPS from continuing operations is anticipated to be in the band of $9.40-$9.60.
Other Stock to Consider
Chipotle Mexican Grill, Inc. (CMG - Free Report) carries a Zacks Rank #2 (Buy) at present. CMG is expected to register 14.3% growth in earnings in the fourth quarter of 2024.
It reported better-than-expected earnings in each of the trailing four quarters, with an average surprise of 9.8%.
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Brinker Q2 Earnings & Revenues Beat Estimates, Increase Y/Y
Brinker International, Inc. (EAT - Free Report) reported second-quarter fiscal 2025 results, with earnings and revenues beating the Zacks Consensus Estimate. Both top and bottom lines increased from the prior-year reported figures.
Find the latest earnings estimates and surprises on Zacks Earnings Calendar.
The company's quarterly performance benefited from strong fundamentals, leading to better guest experience and steady business growth. Higher comparable restaurant sales at Chili’s drove the top line as both new and returning guests visited more frequently despite a competitive market.
Following the results, the company’s shares rose 12.5% in today’s pre-market trading session. Positive investor sentiments were witnessed as the company raised its guidance for fiscal 2025.
EAT’s Q2 Earnings and Revenues
In the quarter under review, Brinker reported adjusted earnings per share (EPS) of $2.80, which beat the Zacks Consensus Estimate of $1.80. The company reported an EPS of 99 cents in the prior-year quarter.
Brinker International, Inc. Price, Consensus and EPS Surprise
Brinker International, Inc. price-consensus-eps-surprise-chart | Brinker International, Inc. Quote
In the fiscal second quarter, total revenues of $1.36 billion outpaced the consensus mark of $1.24 billion. The top line increased 26.5% on a year-over-year basis. EAT gained from the solid performance of Chili's.
Chili's
In the fiscal second quarter, revenues in the Chili’s segment rose 30.4% year over year to $1.21 billion. This upside was backed by favorable comparable restaurant sales, driven by menu pricing, higher traffic and a favorable menu item mix. Our model predicted segmental revenues at $1.01 billion.
Chili's restaurant expenses (as a percentage of company sales) in the fiscal second quarter were 81.3%, down from 88.4% in the prior-year quarter. This downside was caused by sales leverage, partially overshadowed by an increase in hourly labor, repairs and maintenance expenses, higher manager salaries and bonus, and unfavorable commodity costs.
Chili's company-owned traffic rose 19.9% year over year in the quarter under discussion. The metric fell 0.6% in the prior-year quarter.
The segment’s company-owned comps rose 31.4% in the fiscal second quarter from the year-ago quarter’s levels.
At Chili’s, domestic comps (including company-owned and franchised) gained 30.8% compared with a 5.1% rise reported in the prior-year period.
Maggiano’s
Maggiano’s sales in the fiscal second quarter increased 1.7% year over year to $149.4 million. Our model predicted segmental revenues at $151.2 million. Favorable comparable restaurant sales, courtesy of increased menu pricing, drove this upside. However, this was partially offset by lower traffic. Comps in the segment rose 1.8% year over year. Our prediction was 3%.
Traffic in the quarter under discussion fell 4.9% year over year. The metric was down 4.2% in the prior-year quarter.
Maggiano's company restaurant expenses (as a percentage of company sales) in the fiscal second quarter were 77.3%, marginally up from 77.1% a year ago. This upside was caused by increased advertising expense, management salary, repairs and maintenance, and unfavorable commodity costs. However, this was partially offset by sales leverage and lower hourly labor.
EAT’s Operating Results
In the quarter under review, total operating costs and expenses were $1.20 billion, up from $1.01 billion reported in the year-ago quarter. Adjusted restaurant operating margin, as a percentage of company sales, was 19.1%, up from 13.1% reported in the prior-year quarter.
Adjusted EBITDA in the fiscal second quarter was $215.8 million. The figure was up from $107 million reported in the prior-year quarter.
Balance Sheet of EAT
As of Dec. 25, 2024, cash and cash equivalents amounted to $14.8 million compared with $22.7 million as of Dec. 25, 2023. As of Dec. 25, long-term debt (less current installments) was $625 million compared with $786.3 million as of June 26, 2024.
EAT’s Fiscal 2025 Guidance Raised
In fiscal 2025, management anticipates total revenues to be in the range of $5.15-$5.25 billion compared with the previous expectation of $4.70-$4.75 billion. Capital expenditures are expected in the $240-$260 million band, up from prior expectation of $195-$215 million. EAT anticipates fiscal 2025 EPS in the range of $7.5-$8, up from the prior estimate of $5.2-$5.5.
EAT’s Zacks Rank & Recent Retail-Wholesale Releases
Brinker currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Fastenal Company (FAST - Free Report) reported lower-than-expected fourth-quarter 2024 results, with earnings and net sales lagging the Zacks Consensus Estimate. On a year-over-year basis, the top line rose while the bottom line remained flat.
Growth in sales was primarily driven by the expansion of Onsite locations, which cater directly to customer facilities, and increased adoption of the company’s digital platforms. However, FAST faced significant challenges, including a soft manufacturing environment throughout 2024. A weakened demand, particularly for fasteners, a core product category, further affected growth. Nonetheless, its focus on strategic initiatives like digital transformation and customer-centric services is expected to bolster its long-term market position despite short-term challenges.
Darden Restaurants, Inc. (DRI - Free Report) reported second-quarter fiscal 2025 results, with earnings missing the Zacks Consensus Estimate and revenues beating the same. The top and bottom lines increased on a year-over-year basis.
The quarter’s sales inched up 6% from the prior-year quarter’s level. The upside was backed by a blended same-restaurant sales increase of 2.4%. Also, contributions from 103 Chuy's restaurants and 39 net new restaurants added to the positives. Same-restaurant sales growth in fiscal 2025 is anticipated to be 1.5% year over year. Also, EPS from continuing operations is anticipated to be in the band of $9.40-$9.60.
Other Stock to Consider
Chipotle Mexican Grill, Inc. (CMG - Free Report) carries a Zacks Rank #2 (Buy) at present. CMG is expected to register 14.3% growth in earnings in the fourth quarter of 2024.
It reported better-than-expected earnings in each of the trailing four quarters, with an average surprise of 9.8%.