管理層發言
Greetings and welcome to the Bloomin' Brands Fiscal Second Quarter 2026 Earnings Conference Call. Please note this event is being recorded. It is now my pleasure to introduce your host, Tara Kurian, Senior Vice President, IR, FP&A and International. Thank you, Ms. Kurian. You may begin.
Thank you, and good morning, everyone. With me on today's call are Mike Spanos, our Chief Executive Officer, and Eric Christel, Executive Vice President and Chief Financial Officer. By now, you should have access to our fiscal second quarter 2026 earnings release and our investor presentation slides, both of which can be found on our website at www.bloominbrands.com in the Investor section. Throughout this conference call, we will be presenting results on an adjusted basis. An explanation of our use of non-GAAP financial measures and reconciliations to the most directly comparable GAAP measures appear in our earnings release and investor presentation on our website, as previously described. Before we begin formal remarks, I'd like to remind everyone that part of our discussion today will include forward-looking statements, including a discussion of recent trends. These statements are subject to numerous risks and uncertainties that could cause actual results to differ in a material way from our forward-looking statements. Some of these risks are mentioned in our earnings release. Others are discussed in our SEC filings, which are available at www.sec.gov. During today's call, we'll provide a brief recap of our financial performance for the fiscal second quarter 2026, current thoughts on fiscal 2026 guidance, and an update on our turnaround strategy. Once we've completed these remarks, we'll open the call up for questions. With that, I would now like to turn the call over to Mike Spanos.
Thanks, Tara, and good morning, everyone. I will discuss our second quarter results and provide an update on our turnaround. Eric will then review the financials and our thoughts on guidance. First, I want to congratulate our team on the progress on both the Outback Turnaround Plan and our financial results. Our focus on consistency of execution on food quality, service, experience, and providing affordable offers is making an impact. As Pat Hafner, President of Outback, told his team at our Managing Partner Conference in June, "Motivation gets you going. Consistency of execution keeps you growing." We remain committed to consistency of execution that delivers a cumulative impact in delivering a great guest experience. While success will not be linear, we believe these commitments will lead to sustainable and profitable growth in the long term. Turning to our second quarter results. Outback's Guest Metric Scores continue to improve, with year-over-year gains for the fourth consecutive quarter reinforcing that we are getting better every day. This is the power of consistency of execution. In Q2 of this year compared to Q2 of last year, Outback's Guest Scores increased across service by 7 points, atmosphere by 7 points, value by 6 points, intent to return by 5 points, food by 4 points, and brand trust by 2 points. I will share more details of our Outback turnaround progress shortly. Our Q2 U.S. comparable restaurant sales were positive 230 basis points with traffic down 190 basis points. We have continued to narrow the gap versus the industry as defined by Black Box each quarter, and our Q2 comp sales were in line with Black Box while traffic trailed by 110 basis points. Affordable entry price points at our casual dining brands, combined with consistent execution and craveable service, is improving our what-you-get-for-what-you-pay-for value equation. Outback's Q2 comp sales were up 140 basis points with traffic down 280 basis points. As we mentioned in our first quarter earnings call, we chose not to lap some dilutive traffic offerings from Q2 2025, particularly in our third-party delivery space. While third-party delivery remains a key part of our business and plays an important role for convenience, our focus is on delivering a remarkable dining experience to drive sustainable traffic growth. Outback continues to drive traffic and loyalty from the Aussie 3-Course affordability offering, with about 60% of the guests consistently trading up from the entry price point into the higher price tiers and approximately 20% trading up on the dessert option. Carrabba's comp sales were up 170 basis points with traffic of negative 250 basis points. Similar to Outback, we chose to not lap some dilutive third-party delivery offerings from prior year. This is the sixth consecutive quarter that Carrabba's drove positive comp sales, driven by continued focus on the in-restaurant experience and delivering elevated, authentic Italian food with warm hospitality. We are seeing positive results and increased guest satisfaction from our updated day-of-week offers and continued strong interaction with our experiential wine dinners. Bonefish's comp sales were up 810 basis points with traffic of positive 450 basis points. Bonefish continues to steadily improve traffic growth with momentum in day-of-the-week offers such as Margarita and Martini Mondays and Bang Bang Shrimp Wednesdays. The team has done an excellent job of engaging guests with an energetic bar in a polished casual seafood environment, leveraging our core menu items for exciting affordability offers. Fleming's comp sales were up 160 basis points, with traffic down 280 basis points, and achieving the eighth consecutive quarter of positive comp sales growth. The team continues to provide memorable special occasions for our guests through disciplined execution and approachable offers. I will now update you on our turnaround focused on Outback Steakhouse. The turnaround is anchored on four strategic platforms as previously communicated, which are, first, deliver a remarkable dining experience; second, drive brand relevancy; third, reignite a culture of ownership and fun; fourth, invest in our restaurants. These platforms will be supported by non-guest-facing productivity savings, balanced capital allocation, and a strong management team. Starting with an update on the first platform to deliver a remarkable dine-in experience. The first step was the launch of our new steak lineup in November of last year. We continue to see our steak score in the top box. Consistent with Technomic, our Ziosk guest scores are showing noteworthy improvements year-over-year across intent to return, food quality, service, steak temperature, and value. The commitment to consistency of execution has driven four consecutive quarters of year-over-year improvements in Outback Guest Metric Scores. Moving to the next element of a remarkable dining experience, Craveable Service. As we have previously communicated, we identified that our 1 server to 6 table station ratio during peak hours didn't provide the right level of guest interaction and satisfaction. In Q2, we successfully rolled out our new service model to all Outbacks, reducing our ratio to 4 tables per server during peak hours. We are receiving positive guest feedback from this change. Our Q2 absolute service scores were over 90% top box and increased by nearly 3 points year-over-year. Like our steak quality, guests are telling us they see the difference in our enhanced service model, improving the what-you-get-for-what-you-pay-for value equation. Our Outbackers continue to leverage the tabletop Ziosk data to drive accountability and close any gaps in performance in each restaurant. We will continue our commitment to delivering a great guest experience with training for front-of-the-house Outbackers this month on our enhanced hospitality experience model to deliver a fun, casual, Aussie, No Rules, Just Right experience. Our second strategic platform is driving brand relevancy at Outback to differentiate the brand. We will embrace the core of our Aussie brand roots by inviting customers to come as our guest and leave as our mate. Our brand communication will primarily showcase the quality of our steak lineup with a balance of brand equity and the affordability of our Aussie 3-Course offer and craveable service. We are increasing our marketing spend year-over-year in the second half of this year, and will continue to shift our marketing mix into social and digital channels. Marketing will bring them in with a No Rules, Just Right, Aussie irreverence, and a relentless focus on consistent execution will bring guests back. Reignite a culture of ownership and fun is our third strategic platform. Our people are the key to our turnaround, and we are focused on having strong leadership throughout our restaurants, starting with our Managing Partners. Reigniting a culture of ownership and fun begins with recognizing the achievements of our partners and Outbackers. We held our Outback Managing Partners Conference in June. This was the first time since 2019 that we have had our partners together, and it was a great event to get them energized around the elements of the turnaround. We have great partners, and they are clear on their ownership to deliver a great guest experience. We were privileged to have one of our Outback founders, Tim Gannon, who invented the Bloomin' Onion, spend two days with our team, inspiring them on the core of the brand, our special culture, and the potential of our business based on the turnaround plan. What was particularly motivating was Tim's feedback that we are doing the right things to turn around Outback. I want to congratulate Market Vice President Robbie Atkins for being named Outbacker of the Year. Robbie exemplifies our principles and beliefs as a leader, setting the standard that success is growth in sales and profits and is the result of taking care of our people and guests. Congratulations, Robbie. Additionally, consistent with what we communicated in our previous earnings call, we implemented the first phase of an updated MP compensation model during Q2. The first phase of our MP compensation program has two key goals. First, to ensure total cash compensation is competitive with the local market, starting with a competitive base salary, and second, to ensure that total cash compensation remains tied to the growth of sales and profit of the restaurant. Lastly, let me update you on our fourth strategic platform, invest in our restaurants. We are on track with our goal to touch nearly all of the Outback restaurants by the end of 2028 with targeted initiatives to refresh the interior and exterior, expecting to spend on average between $350,000 and $400,000 per refresh location. We have completed approximately 31 Outback refreshes through the end of July and are on track to complete around 85 for the full year of 2026. This asset refresh approach focuses on improving guest ambiance in the restaurant interior and exterior, which will improve the dine-in experience. Additionally, we have completed the rollout of our chargrill expansion across Outback. This cooking platform enhancement allows our Outbackers to have the optimal cooking platform for our new steak proteins and non-steak proteins. Let me now turn it over to Eric to review our financial performance for Q2 and guidance for Q3 and full year fiscal 2026.
Thank you, Mike, and good morning, everyone. I would like to start by providing a recap of our continuing operations financial performance for the fiscal second quarter of 2026. Q2 total revenues were $1.02 billion compared to $1 billion last year, reflecting a 1% increase. Restaurant sales were up, driven by positive comparable restaurant sales of 230 basis points. We remain very focused on narrowing the gap to the industry in the near term and positioning ourselves to lead the industry in the long term. Average check increased by 420 basis points compared to 2025, with pricing partially offset by negative mix as we continue to invest in affordable offers for our guests. We are seeing an improvement in our mix compared to our original forecast, driven by the leadership and efforts of our Outback team in three key areas. First, we have enhanced our menu design to incent our guests to enjoy our combo offerings, which feature our outstanding steak and non-steak proteins together. Second, we are seeing guests trade up to more premium steak cuts once they engage with our servers and see the steaks on the menu. Third, we are seeing continued momentum from our non-alcoholic mocktails, providing a premium and experiential beverage experience to include low-calorie options such as our strawberry peach refresher to complement our Aussie-themed Mock Croc and Sharky Temple. As a result of what we are seeing in mix, this has a positive impact on the turnaround investment dollars, which I will explain in detail shortly. Off-premises sales were 24% of total U.S. sales in the quarter, consistent with Q2 last year. Outback's off-premises mix were 26% in the quarter and Carrabba's were 34%. Our GAAP diluted earnings per share was $0.37 compared to earnings of $0.29 per share last year. Our Q2 adjusted diluted earnings was $0.39 per share versus earnings of $0.32 per share last year. The difference between GAAP and adjusted GAAP operating results is approximately $3 million of adjustments in Q2 2026, primarily as a result of transformational and restructuring activities. The Q2 adjusted operating margins were 4.0% versus 3.5% last year. The 50-basis-point difference between this year and last year was driven by improved restaurant margins. Within restaurant margin, COGS was elevated compared to last year, driven by commodities inflation of 5.7%. Labor was favorable, driven by the lap of higher health insurance costs in the prior year, and other restaurant operating expense favorability was driven by non-guest-facing productivity. As it relates to our 33% retained ownership in Brazil, which is classified as an equity method investment, we recognize the loss of approximately $900,000 in Q2. We still expect the full year loss to be approximately $3 million to $4 million. According to our capital structure in Q2, total debt net of cash is $636 million. As of the end of Q2 2026, our leverage metrics were 3.7x on a lease-adjusted net leverage basis and 2.0x on a net debt to adjusted EBITDA basis. Our long-term lease-adjusted net leverage ratio goal remains 3.0x. Capital expenditures in the quarter were $44 million. We expect to complete a large amount of refreshes in Q3 of this year and taper off in Q4 as we focus on serving our guests during peak season. We still expect the full-year capital expenditures to be in the range of $185 million to $195 million. Consistent with our previous communication, our capital allocation priorities are to, one, invest in the base business, and two, pay down debt. Teams are committed to these priorities to provide a platform for the turnaround and a strong balance sheet to support growth. As I mentioned, we are seeing improved mixed trends at Outback, which has a positive impact on the turnaround investment needed in 2026. We had allocated $25 million for food investments, of which $18 million were specifically for mix, we now expect the mix investment to be $4 million. The turnaround investments now total $36 million down from $50 million. Productivity savings remain on track for $30 million for a net investment in 2026 of $6 million. Turning to our guidance this year, as it relates to the full year fiscal 2026, we expect U.S. comparable restaurant sales to be between 1% and 2%. We expect sales mix to improve by approximately 100 basis points, offset by slightly lower traffic as we make the strategic decision to not repeat profit dilutive offers from last year. We now expect our adjusted diluted earnings per share to be between $0.90 and $1. Our previous guidance was between $0.75 and $0.90. The increase in our earnings per share guidance range is attributable to our year-to-date performance, improved mixed trends, and better middle of the P&L cost controls. As it relates to the third quarter of 2026, we expect Q3 U.S. comparable restaurant sales to be between 1% and 2%. We expect Q3 adjusted diluted earnings per share to be between negative $0.27 and negative $0.22. We expect to have a tax expense of approximately $5 million in the quarter. Our full year tax rate is expected to be negative, which will drive a tax expense in Q3 due to our negative earnings outlook. We expect our 33% Brazil EMI to be approximately negative $2 million. Let me now turn it back over to Mike.
Thanks, Eric. Overall, we are on track with our Outback turnaround, implementing and executing what we said we would do. We are building momentum in our guest feedback and Outbacker feedback tells us our strategy is sound. Our strategy is consistent and is, one, deliver a remarkable dining experience through improved steak quality, enhanced service, and consistency of execution. Two, drive brand relevancy to differentiate Outback. Three, reignite a culture of ownership and fun with a commitment to our people. Four, invest in our restaurants to refresh approximately 100% of Outbacks by 2028. Investment in the turnaround is supported by non-guest-facing productivity savings with a balanced capital allocation led by an outstanding set of leaders that are seasoned restaurant operators. We acknowledge that success is not linear, and we will continue to responsibly pace and sequence the investments to deliver a great guest experience and foster positive team member engagement. The leadership team continues to be committed to our strategy to provide long-term, sustainable profit growth and improving every day in how we operate our business. We will continue to be transparent in our progress. I want to close today's call by thanking all of our teams in the restaurants and restaurant support center. Our current results and our future potential would not be possible without the dedication, hard work, and commitment of our Outbackers, our Amigos, our Anglers, and our Associates to deliver remarkable guest experience every day. With that, let me open up the call for questions.
分析師問答
The first question comes from Alex Slagle with Jefferies. Please go ahead.
I wanted to ask on, as you're looking at the outcomes, the steak upgrades, service changes, are there any notable surprises in how you're seeing the improved performance and experience metrics shake out? Is it fairly broad-based and even, or is it still more varied and dependent upon the quality of the teams and the management teams you have in place? Also, is the improved mix and check performance that drove the guidance upside more a direct reflection of some of the service changes and menu changes?
Yes, morning, Alex. I'll break that down into what appears to be three questions. On steak, we're really excited about what we're seeing in the steak lineup. It's performing really well. Our Outbackers are excited to sell it, and our back of the house is executing it. We're seeing top box scores across the board. A nice surprise has been guests trading up more into the premium cuts. That's been better than what we saw in our tests in 2025. Also encouraging is the combo reaction to the new steak lineup and guests engaging with our differentiated non-steak proteins. When I look at all that, I feel really good. We're still focused on consistency of execution, leveraging Ziosk to get it right. The chargrill expansion gives us a lot more capacity to nail the lineup and we feel good about our optimal cooking platform. On service, it's playing out in the early stages exactly as we intended. We wanted to move to a 1 server to 4-table station ratio during peak and that has worked well. Pay for servers is almost exactly the same as before, tips are up as a percentage, and tips shared are down. We're seeing ownership culture where the server owns the table, which is core to Outback's earlier success. Ziosk results show improvements in likelihood to recommend a server and intent to return. On mix, the team did a great job with menu design. Guests trading up to premium cuts is notable, and we've seen nice leverage on premium side steak toppers and premium sides like a Parmesan creamed corn that has done well. Desserts have been up as well, with guests trading up on items like the Chocolate Thunder and the Chocolate Chip Skillet. We're seeing guests spend when they feel great in the restaurant.
Thank you. The next question comes from Sara Senatore with Bank of America. Please go ahead.
This is Ashley on for Sara. You noted in the prepared remarks Outback's guest metrics improved for a fourth consecutive quarter, and you called out positive guest feedback from the full rollout of the new service model, but Outback's traffic was still down 2.5% in Q2. How should we think about the bridge from better guest scores to actual traffic conversion? Are there any early markets or restaurants where these guest metric gains are already translating into higher frequency by customers?
Hey Ashley, good morning. Our focus is long-term and on sustainable, profitable traffic. Success is not linear. There's a cumulative effect in this industry when average guest frequency is about twice a year. Combine momentum in the steak lineup, the service model, the hospitality training we're rolling out, and affordability offers, and you create a flywheel. It takes time. Our Outbackers and guests are telling us we're on the right path. When locations do what is true to the core of the brand, we grow traffic and comp sales sustainably. We'll be transparent about results and careful not to over-project future traffic, but we're confident growth will come because we're seeing the underlying results.
Thank you. The next question comes from John Ivankoe with JPMorgan. Please go ahead.
It's interesting to see your success in having customers push the Outback brand higher through premium steaks, sides, and toppings. The question is on the opportunity to achieve value through price points. The brand was promoting mid-teens offers for a while, like the 3-course. Does it make sense to re-establish that part of the menu and engage in a core high-low strategy, or should we focus on the core and the higher-end part of the menu at this point?
Morning, John. I think we're doing that. Across the casual dining brands, and specifically Outback, we've been sharp on barbell pricing. The Aussie 3-Course is the entry point and offers affordability, particularly for households under $100,000, and we're seeing good retention and frequency. You can come in at an entry price and feel good about value. On the other end, guests are trading up to premium cuts like the strip, our ribeyes, and the boneless 20-ounce bone-in, and that's producing good results. So we are delivering both entry-level affordability and premium options. Consistency of execution is critical; guests love the brand when we do it right. That's the approach and what we're seeing working now.
Okay, thank you. If I can, on a follow-up, in terms of the remodel, interior and exterior, for $350,000 to $400,000 — for a casual diner, especially with some age on it, that's a really low number, so firstly, congratulations. Would you like to spend more if you could? In other words, are we nailing it at $350,000 to $400,000 so it won't need revisiting for 10 years, or might this remodel be part of a multi-stage process as your financials allow?
Yes, John, it is enough. As I said on the last earnings call, we're focused on the right ambiance and touch points interior and exterior so guests feel we've updated items that matter to them, and the exterior signals change to those driving by. Inside, it's predominantly tables, chairs, floors, some ceilings, touch-up on the bar, and the TV package. Exterior work focuses on landscaping, painting, and lighting. That fits into the average of $350,000 to $400,000. In terms of scope, with roughly just under 600 total Outbacks, about half have had significant remodels or are new, leaving roughly 300 to refresh. We're targeting about 100 per year, expecting approximately 85 this year. We like the traffic lift after refreshes and expect a roughly 100 to 200 basis point lift about six months to a year after completion.
Thank you, and I look forward to more time in restaurants.
Yes, we'd like that, John. Thank you.
The next question comes from Jeff Farmer with Gordon Haskett. Please go ahead.
I'm curious what the menu pricing versus commodity inflation spread will look like as you get into the back half of the year — how that dynamic will impact margins. Also, as it relates to advertising weights, as you move into the back half of this year, can you give context on advertising dollars versus the back half of 2025 and how you plan to use those advertising dollars?
We still see commodity inflation running basically 4.5% to 5.5% for the year. We've been consistent on that outlook. We see pricing in about the 4.5% range, so it's pretty balanced. That has been our approach all year and will continue. On advertising, we're up roughly $15 million versus prior year for the full year, which is roughly 3% of sales for the full year. That's about $10 million more in Outback and the rest of the brands have a couple million apiece. Much of that is second-half weighted, so it's right in line with our plan.
On pricing, remember checks will likely move by about 3.5% given mix impact. We've seen mixed improvement as the Outback team has done a better job. On marketing, I'm excited about the work the team has produced. Strategically, we'll be brand-focused: Aussie, steakhouse, with irreverence, and the communication will be steak-centric to reinforce steak excellence while balancing affordability through Aussie 3-Course. We'll increase marketing in the second half. We'll also roll out hospitality training to further train front-of-house to bring experience and energy into the restaurant. We'll split the marketing between equity, brand communication, and affordability centered on Aussie 3-Course. We're shifting the media mix to about 60% digital and 40% linear TV over time as we recruit Gen-X, Gen-Z, and Millennials and move more into social and digital channels.
The next question comes from Brian Mullan with Piper Sandler. Please go ahead.
You hosted the Managing Partners Summit for Outback for the first time since 2019, so I wanted to ask about anything interesting or surprising that you learned from a boots-on-the-ground perspective from the operators. Thank you.
It was an awesome session. The biggest takeaway was how energized our partners were with the Outback Turnaround Plan. Engagement was extremely important. Pat and the team did a great job. There was an element of fun, recognition, training, and ownership. Everyone knows their roles and responsibilities and what must be done because that's our culture of accountability. Having Tim Gannon there was special. When one of your co-founders tells the team we're doing the right things, it's motivating. We all walked away energized. As Pat said, motivation gets you going, but consistency of execution keeps you growing. That's where we're at.
This concludes our question and answer session. I would like to turn the conference back over to Mike Spanos for any closing remarks.
Thank you once again for your investment and support of Bloomin' Brands. I want to close by thanking our people for their passion and commitment to each other and our guests. Thank you.
The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.