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Red Robin’s brand revamp spurs Q2 profit, sales growth

As Red Robin Gourmet Burgers continues its “brand transformation initiative,” net income at the casual-dining company increased 13.6 percent year over year during the second quarter, Red Robin reported Tuesday.

The company reported net income of $11.2 million in the quarter ended July 12, on revenues of $293 million. Comp sales at Red Robin increased 2.9 percent compared to the same period last year, driven by a 0.5 percent boost in customer traffic and a 2.4 percent increase in average check. 

“We continue to be pleased with the progress we are making toward a best-in-class brand experience,” said Red Robin CEO Steve Carley. “Our guests are choosing to visit us more frequently and they are trading up to our newest burgers and beers.”

Red Robin’s brand-transformation efforts have hinged on recent moves to distance itself from a bar-centric atmosphere and appeal to a broader audience, such as adding separate “zones” for varying dining segments and beefing up in-store offerings for kids.

It’s also been building out Red Robin Burger Works—a 10-unit offshoot concept primed for urban markets—and upgrading its tech offerings, rolling out Ziosk tabletop tablets systemwide so that customers can order and pay for meals at their own pace.

During Q2, Red Robin completed 31 restaurant remodels toward its goal of 150 remodels for the fiscal year, the company said. It anticipates that more than half of its 521 units will conform to the updated brand standards by year’s end. 

Once the remodel is complete, the brand transformation will transition to a strategy for speeding up unit growth, Carley said. The company anticipates adding 20 new Red Robin locations and three to five Burger Works units by the end of 2015.

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