Texas Roadhouse(US:TXRH)2025-11-07 14:01Financial Performance - Total revenue increased by $163.3 million or 12.8% to $1,436.3 million in Q3 2025 compared to Q3 2024, driven by a 6.8% increase in store weeks and a 6.1% increase in comparable restaurant sales [73]. - Net income decreased by $1.2 million or 1.5% to $83.2 million in Q3 2025, impacted by rising food and beverage costs and depreciation expenses [74]. - Diluted earnings per share decreased by 0.8% to $1.25 in Q3 2025 from $1.26 in Q3 2024 due to the decline in net income [74]. - Total revenue for Q3 2025 was $1,436.3 million, a 12.9% increase compared to Q3 2024's $1,273.0 million [79]. - Net income attributable to Texas Roadhouse, Inc. was $83.2 million in Q3 2025, compared to $84.4 million in Q3 2024 [79]. Restaurant Operations - Restaurant margin dollars increased by $2.2 million or 1.1% to $204.3 million in Q3 2025, while the restaurant margin percentage decreased to 14.3% from 16.0% in Q3 2024 [75]. - The increase in comparable restaurant sales was attributed to higher guest traffic and an increase in the per person average check amount [73]. - Comparable restaurant sales growth was 6.1% in Q3 2025, down from 8.5% in Q3 2024 [88]. - The average unit volume for Texas Roadhouse restaurants was $2,104, an increase from $1,994 in Q3 2024 [86]. - Restaurant margin as a percentage of restaurant and other sales was 14.3% in Q3 2025, down from 16.0% in Q3 2024 [80]. Cost and Inflation - Commodity inflation was reported at 7.9% and wage and other labor inflation at 3.9%, contributing to the decrease in restaurant margin percentage [75]. - Food and beverage costs as a percentage of restaurant sales increased to 35.8% in Q3 2025 from 33.5% in Q3 2024, driven by commodity inflation of 7.9% [92]. - Wage and other labor inflation is expected to be approximately 4% in 2025 and 3% to 4% in 2026 [95]. Capital Expenditures and Dividends - Capital allocation included capital expenditures of $128.9 million, dividends of $45.1 million, and common stock repurchases of $40.0 million [76]. - The company expects capital expenditures of approximately $400 million in both 2025 and 2026, driven by new store openings [119]. - The Board approved a quarterly cash dividend of $0.68 per share in 2025, up from $0.61 per share in 2024, totaling $135.4 million in 2025 YTD [120]. Company Growth and Structure - As of September 30, 2025, the company operated 702 company restaurants, including 638 Texas Roadhouse, 54 Bubba's 33, and 10 Jaggers restaurants [65]. - The company opened 13 Texas Roadhouse, 5 Bubba's 33, and 1 Jaggers restaurants in 2025, with expectations of approximately 5% store week growth across all concepts [90]. - The company has a 5.0% to 10.0% ownership interest in 17 of the 19 majority-owned restaurants and 39 of the 44 systemwide domestic franchise restaurants [63]. Financial Position and Compliance - As of September 30, 2025, the company had no outstanding borrowings under the credit facility and $446.8 million of availability, net of $3.2 million of outstanding letters of credit [126]. - The interest rate for the credit facility as of September 30, 2025, was 5.34%, compared to 5.72% as of September 24, 2024 [126]. - The company was in compliance with all financial covenants as of September 30, 2025, including maintaining a minimum consolidated fixed charge coverage ratio and a maximum consolidated leverage ratio [127]. - The company was contingently liable for $8.7 million in lease guarantees as of September 30, 2025, down from $9.4 million as of December 31, 2024 [128]. - No material liabilities have been recorded as of September 30, 2025, as the likelihood of default was deemed less than probable [129]. - There have been no material changes in market risk since the disclosures in the Annual Report on Form 10-K for the year ended December 31, 2024 [130]. Cash Flow - Net cash provided by operating activities was $509.6 million in 2025 YTD, down from $516.1 million in 2024 YTD [112]. - Net cash used in investing activities increased to $384.2 million in 2025 YTD from $237.2 million in 2024 YTD, primarily due to the acquisition of 17 franchise restaurants [114]. - Total capital expenditures were $298.8 million in 2025 YTD, compared to $246.5 million in 2024 YTD [116].