Driven by sales gains at its Taco Cabana and Pollo Tropical fast-casual brands, Fiesta Restaurant Group saw its profit jump 20.8 percent in the quarter ended June 28, the company said Thursday.
Same-store sales rose at each of its brands when compared to the same period last year, by 5.6 percent at Taco Cabana and 4.3 percent at Pollo Tropical.
Comparable guest traffic increased by 1 percent at 163-unit Taco Cabana, while 171-unit Pollo Tropical saw a slight dip in customer count, decreasing by 0.2 percent. Company executives attributed the slip to customers cutting back on discretionary spending due to recent enrollment in health-care coverage. Traffic appears to be normalizing and is on the upswing into the third quarter, Fiesta Restaurant Group CEO Timothy Taft said on an earnings call Thursday.
“We compared the current environment to that of early 2013 when payroll taxes increased and IRS refund checks were delayed when we saw guests pull back for restaurant occasions for a few months, but resumed their prior spending habits after this adjustment period,” Taft said. “We are seeing a similar pattern this year as transaction growth improved at the end of second quarter and again in July. Through this past Sunday, July month to-date comparable traffic grew 1.2%, resulting in comp sales of 6.4%.”
Fiesta Restaurant Group’s Q2 revenues increased 11.5 percent, to $171.9 million, up from $154.2 million.