"It was a mixed quarter for Luby's," company president and CEO Chris Pappas said during the company's sales conference call late last week, noting that the quarter's loss was smaller than that of the previous year's first quarter, despite certain higher expenses currently plaguing the restaurant industry, especially higher food and energy costs.

"As the quarter with the lowest sales, the first quarter is always challenging for us," he continued. "Despite higher food commodity prices, which hurt margins, we posted better year-over-year results due to sales increases, lower interest costs, lower general and administrative expenses, and lower discontinued operations charges." Luby's reported a loss before discontinued operations of $0.7 million this quarter, compared with a loss before discontinued operations of $2.0 million in Q1 2004.

Other expenses during the quarter included moving company headquarters from San Antonio to Houston, but the company also made $2.8 million from the sale of some of its closed restaurant properties during the same period. Currently the chain operates 135 restaurants in five states, though the great majority of them are in Dallas, Houston, San Antonio and the Rio Grande Valley in south Texas.