In what could be its last earnings report as a public company, Del Frisco’s Restaurant Group posted a net loss of $6.4 million on revenues of $131.7 million for the second quarter ended June 25.
Losses deepened from the year-ago quarterly shortfall of $1.6 million despite a 73.9% surge in revenues, from $75.7 million. The top line figure reflects the addition of the Bartaco and Barcelona Wine Bar chains to Del Frisco’s heritage holdings, Del Frisco’s Double Eagle Steakhouse and Del Frisco’s Grille.
A number of one-time charges, including a $3.4 million consulting fee and $2 million in legal expenses, figured into the loss for the most recent quarter. Those outlays—about $6 million in total—also included $500,000 in severance payments.
Same-store sales across all four brands increased by 0.5% on a 1.7% increase in pricing. Traffic slipped 1.2%. Transactions grew for Barcelona and Bartaco, by 4.9% and 3.3%, respectively, but dropped 8.3% at the Grille and 3.7% at Double Eagle. Comps for the four concepts ranged from a 5.5% rise for Bartaco, the most casual of Del Frisco’s brands, to a 1.5% slip for Double Eagle. Barcelona’s comps were also positive, at 2.4%, while the Grille posted a decline of 0.6%.
Del Frisco’s agreed in mid-June to be acquired by private equity firm L Catterton for $8 a share, an offer that values the operation at about $650 million. L Catterton is expected to separate Barcelona, a tapas concept, and Bartaco, a cocktails and taco operation, from Del Frisco’s steak operations. Barcelona and Bartaco would then be run in conjunction with L Catterton’s polished-casual Mexican concept, Uncle Julio’s.
The deal is expected to close by the end of the fourth quarter. Del Frisco's did not convene the usual quarterly conference call with financial analysts because of the timeline.