Texas Roadhouse increased its menu prices at the beginning of April, a move which contributed to a “positive sales trend” in the first five weeks of the current quarter, a company executive said.
The pricing increases were confirmed in a recent earnings call on May 7, during which CFO Mike Lenihan specified an overall hike of 1.9% while speaking to the company’s outlook into the second quarter. The company also reported an increase in average weekly sales in the first quarter, which jumped from $163,071 to 174,151 per restaurant, year over year. (Texas Roadhouse, Inc., owns Texas Roadhouse, Bubba’s 33 and Jaggers.)
Still, the company said the increases sales only “partially” offset increased operating costs due to “commodity inflation,” and “wage and labor inflation,” according to the latest earnings release.
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When contacted, a representative for Texas Roadhouse did not discuss how the price increases were implemented at a customer level (e.g., spread across the whole menu or just specific items), nor whether the increases differed regionally.
The rep did say, however, that price increases generally occur biannually in the spring and fall.
“We review menu prices twice a year with increases typically implemented at the beginning of April and the beginning of October,” reads a statement shared with Nexstar. “We maintain a conservative approach to menu pricing with structural inflationary pressures (most often higher wage rates) as the main driver of our pricing decisions.”
Despite any inflationary pressures, Texas Roadhouse’s executives reported significant increases in comparable restaurant sales (7.1%), guest check amounts (2.6%), and profits (restaurant margin dollars increased 10%) over last year.
Jerry Morgan, the CEO of Texas Roadhouse, lauded the company’s “terrific momentum” in a statement included with the May 7 earnings release.
“Our strong traffic trends continue to fuel sales growth, and it’s clear that our commitment to delivering a legendary experience is appreciated by our guests,” Morgan said.
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