The acquisition establishes a company-owned presence in Illinois, Michigan and Tennessee with restaurants in and around Chicago, suburban Detroit, Memphis and Nashville. Two of the acquired restaurants are in Florida.
The company anticipates the closing of the acquisition by late June 2006.
In addition to the acquisitions, the chain is moving ahead with plans to open an additional four to five company units during the remainder of 2006. Moreover, the company plans to add eight to 10 company owned locations and six to eight franchised locations in 2007, according to Craig Miller, president and CEO of Ruth's Chris Steak House.
"We'll continue to focus on building great new restaurants located and designed to achieve at or above system volumes and growth in comparable restaurant sales across our system," Miller said during the chain's earnings conference call. "We will continue to allocate capital to attractive investment opportunities, and as today's announcement suggests, new restaurant development may be complimented by franchise acquisitions and additional development in acquired markets."
During the first quarter, Ruth's Chris opened one company-owned restaurant in Pasadena, CA and one franchise restaurant in Clayton, MO. "We remain on track with our new restaurant development plans and leases are now executed for all of our 2006 planned openings," Miller said. At the end of the first quarter, Ruth's Chris had 94 locations worldwide.
Ruth's Chris' first quarter performance included a 15.5% increase in revenue to $65.4 million, net income of $6 million or 26 cents per share and comparable restaurant sales increase of 6.8% at company-owned restaurants and 5.5% at franchised restaurants.
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