Tuesday, October 21, 2014
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Casual-dining restaurant traffic 'worst' since 2010: report

But high-end restaurants were fulll

Casual-dining restaurant traffic 'worst' since 2010: report

"May 2012 may have been the worst month for chain casual-dining same-store sales in over two years," warns Mark Kalinowski, stock analyst at Janney Capital Markets in Philadelphia, after reviewing sales reports at several publicly-traded restaurant companies.

Kalinowski says sales were below targets at Darden Restaurants, which owns Olive Garden, Red Lobster, Capital Grille, and other popular chains; DineEquity, which franchises Applebee's and International House of Pancakes sites; PF Chang's China Bistro, and Cheesekake Factory.

As a result, Janney is cutting profit projections, particularly for Darden, which owns its restaurants outright. By contrast, Applebee and IHOP losses are shared with franchisees. PF Chang's has already announced plans to go private; Cheesekake Factory is "more insulated as a higher-end" location.

Kalinowski also says his survey of U.S. franchise owners at the biggest fast-food burger chain, McDonald's, shows same-store sales last month grew less than expected, while the strengthening U.S. dollar and higher marketing costs will trim foreign profits.

But: Further up the food chain, high-end restaurants are busy, and their well-off diners pushed industry receipts to their "strongest traffic gains in four years," NPD reports here, as my colleague Michael Klein points out.

Joseph N. DiStefano
About this blog

PhillyDeals posts raw drafts and updates of Joseph N. DiStefano's columns and stories about Philly-area finance, investment, commercial real estate, tech, hiring and public spending, which he's been writing since 1989, mostly for the Philadelphia Inquirer.

DiStefano studied economics, history and a little engineering at Penn, taught writing at St. Joe's, and has written the book Comcasted, more than a thousand columns, and thousands of articles, and raised six children with his wife, who is a saint.

Reach Joseph N. at JoeD@phillynews.com or 215 854 5194.

Joseph N. DiStefano
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