The CEO of Bloomin ‘Brands, the parent company of restaurant chains like Outback Steakhouse and Bonefish Grill, told CNBC on Friday that it is not experiencing an increase in food costs, but that the costs of beef and Seafood “has been an opportunity” during the pandemic.
“There was some concern about the supply chain. That did not materialize as we expected,” said Dave Deno in “Closing Bell.” “We are discovering that the costs of beef, the costs of seafood are actually going down and something we can take advantage of.”
The coronavirus pandemic has caused a significant economic disruption, particularly for the food industry, as many restaurants and bars had to stop eating in person and parts of the supply chain fractured. Some chains, such as Wendy’s, temporarily experienced a meat shortage in certain stores. Others, like Shake Shack, said profits were affected by rising meat costs.
Chipotle also said that rising costs of some ingredients contributed to higher food expenses in its last quarter. But Chief Financial Officer John Hartung said in Chipotle’s earnings call on Wednesday that the surge in meat prices it experienced has improved since its peak in mid-May.
Bloomin ‘Brands shares closed up 7.43% on Friday at $ 11.56 each. The company reported second-quarter revenue of $ 578.5 million before Friday’s bell, 43% less than in the same period a year ago. Comparable sales at the same store in its portfolio fell 39.4% in the quarter.
However, a loss of 74 cents a share was better than the loss of $ 1.12 that Wall Street had expected. Additionally, the Tampa-based company said recent spikes in the Covid-19 cases in Florida and Texas have so far had limited impact on sales trends. “So it has been very encouraging,” Deno said.
Consumer spending in restaurants, as they have reopened, has been strong, with an average bill “almost equal to normal,” he said.
“In our delivery and transportation business it is a little less, since we do not sell alcohol in delivered format,” he said. “In our restaurants, the guest check has remained the same … In fact, what we are seeing is that consumers are choosing more forgiving and cut steaks when they order.”
.
