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Outback: Key Points from 3Q19

  • 3Q19 comps increased +0.2% (-1.1% traffic/+1.3% check). Significant traffic outperformance during the quarter reflected an intentional effort to moderate its check in order to strengthen its relative value equation. In any case, use of discounts have been reduced -17% for the YTD period through September. 
  • Improving trends in October (+2% traffic) reflects strong 4Q LTO line-up (including affordable steak & lobster promotion).
  • Corporate announced that it is exploring and evaluating strategic alternatives, including but not limited to a possible sale of the company. This reflects a frustration that the market has not rewarded BLMN shares for improvements over the last 4 years, including: $50MM of investments in food & service enhancements; growth in off-premise business; the establishment of its loyalty program; acceleration in its international business; & $400MM invested in remodels & relocations.

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