Brinker seeks to rebound in post-vaccine environment

Brinker seeks to rebound in post-vaccine environment

DALLAS — Despite a year-over-year decline in earnings and sales, the second quarter of fiscal 2021 was a “dynamic” one for Brinker International, Inc., said Wyman T. Roberts, president and chief executive officer.

During a Jan. 27 conference call with investors, Mr. Roberts said Brinker is appreciative of all the lessons learned during 2020.

“We learned that we can drive our business and increase market share despite the hurdles brought on by a global pandemic and widespread civil and political unrest,” Mr. Roberts said. “In the second quarter, Chili’s increased its two-year trend of taking share and leading the category with an 18% beat in sales and a 25% beat in traffic, according to KNAPP-TRACK. We learned that our strategies work. The ways we leveraged our scale and our ownership model and the investments we continue to make in technology and improving our operational systems, they were working well for us prior to the pandemic and continued to work even more effectively throughout the year.

“Leveraging those competitive advantages open up opportunities for us to grow our business in unique and innovative ways, like elevating our digital guest experience at both brands and leaning into virtual brands. Those things are hard to execute and even harder to replicate. So we’re taking those lessons into 2021 as we prepare to accelerate organic growth in a post-vaccine environment.”

Net income at Brinker in the second quarter ended Dec. 23, 2020, totaled $12 million, equal to 26¢ per share on the common stock, down 57% from $27.9 million, or 75¢ per share, in the same period a year ago. For the first six months of fiscal 2021, net income totaled $22.7 million, or 50¢ per share, down 47% from $42.8 million, or $1.14 per share, in the same period a year ago.

Revenues in the second quarter fell 12.5% to $760.7 million from $869.3 million. For the first six months of fiscal 2021, revenues were down 9% to $1.5 billion from $1.66 billion.

While Mr. Roberts said Brinker is hopeful that a widespread vaccine will release pent-up dining room demand, he acknowledged that the restaurant operator does not expect a return to the old normal, saying “2020 fundamentally changed us as consumers.”

Brinker, like its customers, has adapted as a result of the pandemic. Mr. Roberts said that while the Brinker team knew that convenience was a big opportunity even before the pandemic, 2020 accelerated the company’s commitment to embrace consumers’ gravitation toward digital interaction and meet them where they are.

“We believe digital sales and traffic will continue to be a strategic driver of our results in both the near and long term,” he said. “So in preparation for fiscal ’22, we’re dedicating even more time, effort and capital to accelerate in our competitive advantage as a digital leader in the category, and aggressively pursuing opportunities to drive our top and bottom line.”