Texas Roadhouse (NASDAQ:TXRH) reported a slight earnings beat in its fourth quarter, with adjusted earnings per share (EPS) of $1.08, surpassing the analyst estimate by $0.02. The company's revenue matched expectations at $1.16 billion, aligning with the consensus estimate. Shares of the restaurant chain rose over 5% following the announcement, indicating a positive investor response to the company's performance.
In a robust quarter, Texas Roadhouse saw a significant 9.9% increase in comparable restaurant sales at company-owned locations and an 8.9% rise at domestic franchise restaurants. Average weekly sales at company restaurants climbed to $141,653, with to-go sales contributing $17,793, up from $130,176 and $16,414, respectively, in the previous year. The increase in restaurant margin dollars by 21.4% to $176.7 million was a key driver of the quarter's success, primarily due to higher sales. Despite facing commodity inflation of 3.2% and wage and labor inflation of 5.5%, the restaurant margin as a percentage of sales improved by 75 basis points to 15.3%.
The company also expanded its footprint, opening 12 new company restaurants and seven franchise locations, and continued its share repurchase program, buying back 40,707 shares for $4.8 million.
Looking ahead to fiscal 2024, Texas Roadhouse provided an optimistic outlook with comparable restaurant sales at company restaurants for the first 50 days of the first quarter increasing by 6.8% compared to the same period in 2023. The company plans to implement a menu price increase of approximately 2.2% in late March. Management anticipates commodity cost inflation of around 5% and an effective income tax rate of approximately 14%. They also expect positive comparable
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