Shrinking beef prices, growing sales drive gains at Ruth’s Hospitality Group

Lower beef prices and sales leaps buoyed profits at Ruth's Hospitality Group during the second quarter ended June 28, the company said Friday.

Net income at the steakhouse company, which operates the Ruth’s Chris brand, increased nearly 9 percent during Q2, to $7.5 million from $6.9 million during the same period last year. In addition, comp sales at company-owned locations increased 4.2 percent year over year, driven by an average check increase of 3.5 percent and a 0.7 percent jump in traffic.

The company benefited from declining food and beverage costs, which, as a percentage of restaurant sales, decreased to 30.5 percent, driven largely by a 2 percent year-over-year decrease in the price of beef. Those gains may be somewhat tempered throughout the rest of the fiscal year, however, as executives noted on an earnings call Friday that beef prices are expected to increase by 3 to 6 percent during the second half of 2015.

Total revenues for the company were $91 million, up 9.7 percent from the same quarter last year.

“Our topline momentum and strong operational execution enables us to generate another quarter of strong earnings growth,” Michael O’Donnell, CEO of Ruth’s Hospitality Group. “As we look forward, we intend to continue to manage our business with a balanced approach of reinvesting in our core operations, maintaining disciplined growth and returning to excess capital, pursuing a strategy that we believe can deliver consistent and meaningful shareholder returns over the long term.” 

Members help make our journalism possible. Become a Restaurant Business member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.


Exclusive Content


Brands need to think creatively as the industry heads into a value war

The Bottom Line: Giving customers meal options they can afford will be key to generating traffic this year. But make sure those offers can generate a profit.


The Red Lobster bankruptcy is a seminal moment for the restaurant business

The Bottom Line: The seafood chain’s bankruptcy declaration was not surprising after months of closures and Endless Shrimp recriminations. But that doesn’t make it any less notable.


The White House has ideas about how all that AI on the Show floor should be used

Reality Check: President Biden issued a set of guidelines Thursday for protecting workers from the digital onslaught.


More from our partners