Red Robin Gourmet Burgers’ (RRGB) stock was down almost 16% at midday Friday after the company’s first-quarter earnings missed Street estimates.
The company on Thursday posted adjusted earnings of $0.19 per share, compared with the year-ago period’s $0.69 per share and analysts’ consensus estimate of $0.49 per share.
In a statement, management said it would shut 10 restaurants, effective May 31, in line with its real estate portfolio review. The restaurants contributed $4.5 million in sales and $900,000 in pre-tax operating losses. While the move is expected to improve profitability, it also will cause second-quarter non-cash impairment charges of $700,000 to $2.6 million, Red Robin said.