Ruby Tuesday, Inc. Announces Retirement of Chief Financial Officer

Maryville, TN  (RestaurantNews.com)  Ruby Tuesday, Inc. (NYSE: RT) announced today that Marguerite N. Duffy, its Chief Financial Officer, will retire from her position effective as of June 5, 2012. The Company is commencing a search for her successor.

A long-time member of Ruby Tuesday’s executive team, Duffy was named Chief Financial Officer in 2001 after having directed each of the finance areas of the Company, including Corporate Accounting, Investor Relations, Financial and Strategic Planning, and Operations Finance, since joining the Company in 1990. During her tenure, the Company spun off two of its businesses into two new public companies, began franchising its brands, issued equity in a public offering that enabled the Company to strengthen its balance sheet, closed numerous debt financings, bought and sold several businesses and, most recently, implemented a sale leaseback program to raise proceeds that will provide the Company with additional flexibility. Duffy has been instrumental in overseeing the Company’s accounting functions, including the establishment and oversight of internal controls over financial reporting. She has also helped build a strong accounting and financial platform that has positioned us for our next phase of growth.

“Margie has given so much of her time and talents to strengthening the Company’s financial position. She has been an invaluable partner and asset to Ruby Tuesday, on behalf of which, I would like to thank Margie for her outstanding contributions. We will miss her and wish her well in her future endeavors,” said Sandy Beall, Ruby Tuesday’s Founder and CEO.

Margie Duffy said, “It has indeed been my pleasure and privilege to serve as Ruby Tuesday’s Chief Financial Officer. It has been an enormous opportunity working with Founder and Chief Executive Officer Sandy Beall and the rest of the Ruby Tuesday team. I express my sincere appreciation to the finance team for their high standards and dedication to excellence. I look forward to helping transition the new finance team leader, spending more time with my family, and then starting the next chapter of my life and career.”

A FRESH NEW RUBY TUESDAY

Ruby Tuesday, Inc. has Company-owned and/or franchise Ruby Tuesday brand restaurants in 45 states, the District of Columbia, 14 foreign countries, and Guam. As of November 29, 2011, the Company owned and operated 742 Ruby Tuesday restaurants, while domestic and international franchisees (including Hawaii and Guam) operated 43 and 44 Ruby Tuesday restaurants, respectively.

Popeyes Louisiana Kitchen has begun a plan for aggressive growth in the Orlando and Tampa, Florida area. With sales in the chicken fast food market at a 10 year high, Popeyes is hoping to take advantage of the boost to power location growth. Over 100 restaurants were opened by the franchise across the country in 2010.

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Member’s only shopping group ShopRunner and Domino’s Pizza have teamed up to give away $1,100 dollars worth of free pizza in the form of gift cards. The contest was designed to celebrate the partnership recently formed between the two companies. One winner will be selected per week through April 25^th. You can enter by joining ShopRunner for a free 30-day trial of their service.

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Dunkin’ Donuts may be famous for their sweet donuts and pastries, but now they want you to visit for savory lunch meals as well. To meet this goal they are introducing a new Chicken Salad Sandwich served on a fresh croissant, toasted bagel or English muffin in the New York state area. Locations around the country recently added savory snack options to their all-day menus as well.

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Ruby Tuesday has reported their third quarter earnings for the 2011 fiscal year, and things are looking slightly down for the company. Small losses occurred in same-store sales and overall net income. However, the company did acquire 7 new franchise partnerships and opened their first seafood chain restaurant, Marlin & Ray’s and first Truffles conversion as well.

Long Island Restaurant Week has begun, and diners can find a variety of price fixe entree options at famous Long Island eateries. For $24.95 guests will receive their choice of an appetizer, entree and dessert from three menu options for each course. Long Island’s restaurant week will end on April 10^th.

Scooter’s Coffeehouse has opened in Omaha, Nebraska, bringing their seven state total to over 90 locations. 35 other locations are found within the general Mid-Western region, including 3 other recent Nebraska openings. This coffee shop chain focuses on drive-through service for busy professionals and a varied drink menu.

Ruby Tuesday has reported financial results for the fiscal third quarter ended March 1, 2011.

Highlights for the third quarter of 2011 compared to the third quarter of 2010 include:

• Same-restaurant sales decreased 1.2% at Company-owned Ruby Tuesday restaurants, with severe winter weather in many of the Company’s core markets negatively impacting same-restaurant sales by an estimated 1.5% to 2.0%
• Net income of $16.0 million, or $15.7 million excluding accounting gains and losses from franchise partnership acquisitions and guarantee charges relating to franchises not acquired, compared to prior-year net income of $17.8 million
• Diluted earnings per share of $0.25, or $0.24 excluding the accounting gains and losses and guarantee charges noted above, compared to diluted earnings per share of $0.28 for the prior year. The severe winter weather negatively impacted earnings per share by an estimated $.03 to $.04 during the quarter.
• Acquired seven franchise partnership businesses and an individual restaurant, representing a total of 73 restaurants
• Opened first converted Marlin & Ray’s, our internally-developed seafood concept, in Maryville, TN on March 1^st and opened first Truffles conversion in the Buckhead (Atlanta) area on December 8^th
• We have included a reconciliation of the franchise partnership acquisition accounting gains and losses and guarantee charges noted above on the Investor Relations page of the Ruby Tuesday website: www.rubytuesday.com

“While our earnings per share trailed the prior-year results, excluding the winter weather impact which hit us harder than most of our peers since approximately 90% of our Company-owned restaurants are concentrated in the Eastern U.S., we would have been in line with our prior-year results, even after absorbing the investments we have made this year. These investments, which include our fresh bread program served complimentary with every entree, incremental labor for service enhancements, and new marketing brand research initiatives, should all yield attractive returns. We believe the Ruby Tuesday brand is in good shape and continue to focus on strengthening the core Ruby Tuesday business, growing our revenue and EBITDA in a low-risk fashion, and further enhancing long-term shareholder value,” said Founder, Chairman, and CEO, Sandy Beall.

Other highlights from our third quarter results include:

• Same-restaurant sales for domestic franchised restaurants increased by 0.4%
• Total revenue increased 3.8% from the prior-year period primarily due to franchise partnership acquisitions
• Sales at domestic and international franchise Ruby Tuesday restaurants (which is the basis for determining royalty fees included in franchise revenue on the Company’s statement of operations) totaled $70.7 million and $91.9 million for the third quarter of fiscal 2011 and 2010, respectively, with the decline driven by the franchise partnership acquisitions
• The Company did not open any new Ruby Tuesday restaurants and closed seven restaurants, one of which was closed in anticipation of conversion
• Domestic and international franchisees opened one new Ruby Tuesday restaurant and closed 13, 11 of which were underperforming franchise partnership restaurants
• Total capital expenditures were $5.1 million
• Book debt to EBITDA ratio of 2.61, which excludes the pro forma EBITDA impact from franchise partnership acquisitions, represents an increase over the prior-year ratio of 2.3, due to the assumption of $128.6 million in debt from franchise partnership acquisitions and payment of $6.5 million in debt guarantees during this fiscal year-to-date

Mr. Beall added, “Our long-term goal to further strengthen and grow our business in a low-risk, high-return manner is supported by our three to five year strategies which are:

• Continue to Enhance Sales and Margins of Our Core Brand – Our primary focus will always be on the Ruby Tuesday brand and how to drive same-restaurant sales and continued brand improvements in food and quality. An example of this is our most recent Seafood Festival which launched on February 15^th and is being promoted via web-based media clips and in approximately 250 movie theaters. This promotion introduces some exciting new seafood offerings such as a shrimp fondue appetizer, a shellfish trio entrée, and tuscan crab tilapia. We believe these quality new offerings, sales-driving initiatives such as Fun With Friends and Couples Night Out, and our continued focus on improving the overall guest experience will facilitate our longer-term goal of providing a $25 high-quality casual dining experience for $15.
• Increase Shareholder Returns Through New Concept Conversions – Our second strategy is to create shareholder value through the conversion of low-volume Ruby Tuesday restaurants to other high quality casual dining concepts better suited for the local market competitive landscape. We now have three restaurant conversions completed with Jim ‘N Nick’s Bar-B-Q (Knoxville), Truffles (Buckhead/Atlanta), and Marlin & Ray’s (Maryville, TN) and site selections for our conversions planned over the next 12-15 months are largely complete. All of our conversion brands have a unique positioning and are aligned with our overall brand strategies of freshness and quality. We will continue to evaluate each of the concepts and make decisions based on the ones we believe we can grow with ease that will generate high returns, while preferably leveraging our existing team talent, technology, and purchasing systems.
• Increase Revenue and EBITDA Through Franchise Partnership Acquisitions – Our third strategy is focused on generating incremental revenue and EBITDA through accretive franchise partnership acquisitions. During the quarter, we acquired the majority of our franchise partnership restaurants at favorable multiples and these acquisitions should provide increases in revenue and EBITDA, in addition to opening up new geographies for our conversion strategy.
• Focus on Low-Risk, Low Capital-Intensive, High-Return Growth – Our fourth strategy is focused on investing in low-risk, low-capital growth initiatives, with a primary focus on leveraging our licensing agreement with Lime Fresh Mexican Grill through inline growth in the upscale fast casual segment. We believe we can create long-term value for our shareholders through this fresh-Mexican restaurant concept which is well aligned with our focus on high-quality food and service and is an exciting concept that is well positioned to a younger demographic. We will be developing our test markets, which include Washington, D.C., the Ohio Valley area, and the SouthEast, beginning in early Fiscal 2012.
• Allocate Capital to Enhance Shareholder Value – Our balance sheet is in great shape and we continue to focus on enhancing our cash flow through the low-risk investments that offer opportunities for high returns noted above; possibly repaying some of our expensive third-party debt; and returning any excess cash to our shareholders, primarily through an opportunistic share repurchase program.”

Fiscal Year 2011 Guidance

• Same-Restaurant Sales – We estimate same-restaurant sales for Company-owned restaurants will be in the range of flat to positive 1.0% for the year, as a result of the third quarter severe winter weather impact and softer sales in the bar grill segment primarily due to higher fuel prices.
• Company-Owned and Licensed Restaurant Development – We do not expect to open any inline restaurants in 2011, expect to close eight to 10 Company-owned restaurants (excluding conversions), and convert four to six Company-owned restaurants to other high-end casual dining concepts. In addition to the 96 franchise restaurants acquired year-to-date through the third quarter, we plan to buy back the remaining 13 franchise partnership restaurants over the remainder of the fiscal year.
• Franchise Restaurant Development – We estimate our franchisees will open six to eight restaurants, up to three of which will be international. Additionally, we expect our franchisees to close 20 – 22 franchise restaurants, with 20 of those closings having occurred through our third fiscal quarter.
• Restaurant Operating Margins – Margins are anticipated to be relatively flat, primarily reflecting the impact of our continued investment in higher-quality menu items and new product offerings, such as our complimentary bread program, as well as investments in service to enhance our guest experience and drive sales, offset by lower promotional levels. Our food costs are expected to remain relatively stable compared to the prior year.
• Other Expenses – Depreciation and Amortization is estimated to be in the $62-$64 million range and selling, general, and administrative expenses are targeted to be up approximately 18%-20% from a year earlier, primarily reflecting a shift in spending from promotional initiatives to advertising expenses, higher marketing brand research, higher training expenses, and the loss of fee income from acquired franchise partnerships which offsets selling, general, and administrative expenses. Interest expense is estimated to be $12-$13 million and the effective tax rate is estimated to be 10%-15%.
• Diluted Earnings Per Share for the year are estimated to be in the $0.74-$0.82 range. Fully-diluted weighted average shares outstanding are estimated to be approximately 64.9 million for the year.
• Capital Expenditures for the year are estimated to be $29-$32 million

In closing, Mr. Beall said, “I am proud of all our team has accomplished, especially in light of the severe winter weather this quarter. We remain focused on growing our excess cash flow; maintaining our strong balance sheet; and investing in low-risk, low-capital, high-return growth opportunities. This is an exciting time to be a part of the Ruby Tuesday team and while the environment is still challenging, we feel positive about our overall ability to grow our business and provide attractive shareholder returns.”

Ruby Tuesday, Inc. has Company-owned and/or franchise Ruby Tuesday brand restaurants in 46 states, the District of Columbia, 15 foreign countries, and Guam. As of March 1, 2011, the Company owned and operated 742 Ruby Tuesday restaurants, while domestic and international franchisees (including Hawaii and Guam) operated 56 and 57 restaurants, respectively. Ruby Tuesday, Inc. is traded on the New York Stock Exchange (Symbol: RT).

Ruby Tuesday, Inc. (NYSE: RT) today reported financial results for the fiscal second quarter ended November 30, 2010.

Highlights for the second quarter of 2011 compared to the second quarter of 2010 include:

• Positive same-restaurant sales of 4.2% at Company-owned Ruby Tuesday restaurants
• Restaurant-level operating margin of 15.1%, compared to 13.7% for the prior year, an improvement of 140 basis points
• Net income of $4.6 million, compared to prior-year net income of $0.4 million
• Diluted earnings per share of $0.07, compared to diluted earnings per share of $0.01 for the prior year
• Negotiated a new five-year, $320 million revolving credit facility with attractive pricing and flexibility, which closed on December 1^st
• Book debt to EBITDA ratio of 2.03 represents an improvement over the prior-year ratio of 2.57

“We are pleased to report our third consecutive quarter of positive same-restaurant sales, and our strongest quarterly sales percentage in almost five years. We believe these results are directly correlated to our repositioning efforts and strategic investments in our high-quality menu offerings, combined with an effective targeted marketing program. We are excited about our Ruby Tuesday brand and believe the investments we continue to make are yielding positive results and momentum, even in this continued challenging economic environment,” said Founder, Chairman, and CEO, Sandy Beall.

Other highlights from our second quarter results include:

• Same-restaurant sales sizably outperformed Knapp-Track^TM, the industry benchmark
• Same-restaurant sales for domestic franchised restaurants increased by 1.6%
• Total revenue increased 6.2% from the prior-year period
• Sales at domestic and international franchise Ruby Tuesday restaurants (which is the basis for determining royalty fees included in franchise revenue on the Company’s statement of operations) totaled $79.9 million and $88.5 million for the second quarter of fiscal 2011 and 2010, respectively
• First Jim ‘N Nick’s Bar-B-Q conversion opened in Knoxville on September 21^st
• The Company acquired three Ruby Tuesday restaurants from a traditional franchisee in Lexington, Kentucky
• The Company did not open any new Ruby Tuesday restaurants and closed one restaurant
• Domestic and international franchisees opened two new Ruby Tuesday restaurants and closed four
• Total capital expenditures were $6.7 million

Mr. Beall added, “Our sales and earnings growth and solid balance sheet are enabling us to execute on our three to five year strategies to further strengthen and grow our business in a low-risk, high-return manner. These strategies include:

• Continue to Enhance Sales and Margins of Our Core Brand – Our number one focus continues to be the strength of the Ruby Tuesday brand, from both a sales and margin standpoint. Our recent new offerings including our fall menu, Fit & Trim entrees, complimentary garlic cheese biscuits, additional side items, enhanced Garden Bar, and enhanced Sunday Brunch have been well received by our guests. We believe continually introducing new key promotions and offerings, which we call “Game Changers,” coupled with our reinvestment in various service-related initiatives, will facilitate our longer-term goal of providing a $25 high-quality casual dining experience for $15.
• Increase Revenue and EBITDA Through New Concept Conversions and Franchise Partnership Acquisitions – Our second strategy is to get more from our existing assets with a focus on converting certain underperforming Company-owned restaurants to other high-quality casual dining concepts. We have completed our first two restaurant conversions with Jim ‘N Nick’s Bar-B-Q, which opened in Knoxville in September, and Truffles, which recently opened on December 8^th in the Buckhead (Atlanta) area. We are in the process of finalizing site selection for additional conversions over the next 18 months and are excited about the potentially high cash-on-cash returns these concepts afford our shareholders. Another part of our plan is focused on generating incremental revenue and EBITDA from our current franchise partners through either potential additional acquisitions or conversion to traditional franchisees over time.
• Focus on Low-Risk, Low Capital-Intensive, High-Return Growth – Our third strategy is focused on investing in low-risk, accretive growth. We are excited about our previously-announced licensing agreement with Lime Fresh Mexican Grill, a Florida-based fast casual fresh-Mexican restaurant concept. We are actively involved in site selection, with a primary focus on smaller, inline locations. The ability to enter the high-growth fast casual segment with a strong brand such as Lime, which is in alignment with our focus on high-quality food and service, provides an attractive growth option with relatively low risk that should create long-term value for our shareholders.
• Allocate Capital to Enhance Shareholder Value – Our recent recapitalization of the Company with a new five-year revolving credit facility provides us with greater flexibility going forward. Our primary areas of focus are to enhance our cash flow through the low-risk, high-return investment opportunities noted above; maintain prudent debt levels; and return any excess cash to our shareholders primarily through an opportunistic share repurchase program.”

Fiscal Year 2011 Guidance

• Same-Restaurant Sales – We estimate same-restaurant sales for Company-owned restaurants will be in the range of flat to positive 2% for the year
• Company-Owned and Licensed Restaurant Development – We expect to open one to two inline restaurants in 2011, expect to close seven to nine Company-owned restaurants, and convert five to seven Company-owned restaurants to other high-end casual dining concepts. In addition to the 20 franchise restaurants acquired during our first fiscal quarter and three restaurants we acquired in the second quarter, we are evaluating the potential buy back of additional franchise restaurants over the remainder of the fiscal year.
• Franchise Restaurant Development – We project our franchisees will open eight to 10 restaurants, up to five of which will be international
• Restaurant Operating Margins – Margins are anticipated to be relatively flat, primarily reflecting the impact of our continued investment in higher-quality menu items and new product offerings, as well as investments in service to enhance our guest experience and drive sales, offset by lower promotional levels. Our food costs are expected to remain relatively stable compared to the prior year.
• Other Expenses – Depreciation is projected in the $60-$63 million range and selling, general, and administrative expenses are targeted to be up approximately 8%-10% from a year earlier, primarily reflecting higher marketing brand research and training expenses. Interest expense is projected to be $10-$12 million and the effective tax rate is estimated to be 20%-25%.
• Diluted Earnings Per Share for the year are projected to be in the $0.76 -$0.86 range. Fully-diluted weighted average shares outstanding are estimated to be approximately 64.5 million for the year.
• Capital Expenditures are estimated to be $29-$33 million

In closing, Mr. Beall said, “While we are pleased with the momentum of our business, our team is determined to work harder and smarter to strengthen our Ruby Tuesday brand as it is the key building block to our long-range plan. We believe we have solid plans in place and are excited about our future. We look forward to leveraging our various growth options, strong balance sheet, and talented team members to continue to rebuild shareholder value.”

A Fresh New Ruby Tuesday

Ruby Tuesday, Inc. has Company-owned and/or franchise Ruby Tuesday brand restaurants in 46 states, the District of Columbia, 15 foreign countries, and Guam. As of November 30, 2010, the Company owned and operated 676 Ruby Tuesday restaurants, while domestic and international franchisees (including Hawaii and Guam) operated 140 and 58 restaurants, respectively. Ruby Tuesday, Inc. is traded on the New York Stock Exchange (Symbol: RT).

America’s appetite for eating out is starting to rumble again.

Three years after the $580 billion restaurant industry saw its harshest downturn in decades, there are signals that the worst may be over for an industry that suffered as people saved by eating out less.

“The glow is off the idea that cooking is fun,” says Ron Paul, president of Technomic, a research specialist. “Consumers are returning to their old habits.” Restaurant business is up in all sectors — from fast-food to casual to tablecloth. The dust began to clear in the third quarter, Paul says, when overall industry same-store sales went positive, following three consecutive years of negative numbers.

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Ruby Tuesday announced today that all its 674 company-owned restaurants are now smoke-free. This effort is another step the brand is taking to provide a more enjoyable dining experience for its guests and promote wellness for its team members. Ruby Tuesday is making the announcement in conjunction with the American Cancer Society’s Great American Smokeout, which is recognized on November 18.

“In keeping with our high-quality casual dining mission, this action further supports our Fresh Taste, Fresh Place brand transformation,” says Sandy Beall, the founder and CEO of Ruby Tuesday. “We care about the health and comfort of our guests and team members and feel it is the right thing to do.”

The American Cancer Society agrees. “We applaud Ruby Tuesday for making all its restaurants smoke-free and thus protecting the health of its customers and employees,” says John Chiaramonte, Government Relations Director for the American Cancer Society in Tennessee.

Ruby Tuesday’s Executive Vice-President, Kimberly Grant says, “Our team members have been smoke-free at work since May of 2009, so this is the natural next step.”

Ruby Tuesday recently unveiled a new Fit & Trim menu that makes it easier to eat healthy while dining out, with the addition of lunch salads, more seafood, and new choices on the Fresh Garden Bar. Grant says the new smoke-free environment keeps with the restaurant chain’s new focus. “Guests have responded favorably to the other improvements and we expect they will embrace this positive change as well,” says Grant. The smoke-free policy extends to the bar and patio areas as well, where outdoor seating is available.

“In 2005, we began a reimaging initiative that included a focus on fresher food and gracious hospitality,” says Beall. “The updated look, feel, and menu offerings are all important components of Ruby Tuesday’s mission to consistently provide a high-quality, casual dining experience with compelling value that guests will enjoy and remember. We believe that a smoke-free environment will enhance the Ruby Tuesday experience,” Beall adds.

About Ruby Tuesday

Ruby Tuesday, Inc. has Company-owned and/or franchise Ruby Tuesday brand restaurants in 46 states, the District of Columbia, 15 foreign countries, and Guam. As of August 31, 2010, the Company owned and operated 674 Ruby Tuesday restaurants, while domestic and international franchisees (including Hawaii and Guam) operated 146 and 57 restaurants, respectively. Ruby Tuesday, Inc. is traded on the New York Stock Exchange (Symbol: RT).

Ruby Tuesday’s was hit hard by the recession, leading some to believe the company would not survive.  Well, they made it.  The company announced that after stocks reached an all-time low in March 2009, shares have increased by 72% so far in 2010 and are closing in on prerecession levels.  The company said consolidating current operations and exploring more profitable restaurant opportunities such as Seafood, Mexican, and Barbecue concepts will continue to be a point of emphasis moving forward.

Debbie Stroud started her career at McDonald’s after speaking to a recruiter at a college job fair more than twenty years ago.  Today she is the Vice President of Quality, Service and Cleanliness for Atlanta region McDonald’s.  During a recent speech to students, faculty, and community members, Stroud showed a video of the riots in Los Angeles in 1992 and how the McDonald’s in the area were safe from damage.  Stroud pointed to McDonald’s diverse hiring practices as a main reason for the restaurants safety, saying that the stores had previously been willing to give former gang members looking to change their life jobs.  Stroud said McDonald’s is just as committed to diversity today as they were nearly twenty years ago and the video shows that diverse hiring practices can offer more than just government compliance.

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Niche restaurant stocks have been trading at higher rates recently.  With Wall Street seeing high returns from companies such as Chipotle and BJ’s Restaurants, investors are betting on restaurants to provide sizeable returns.  Positive indicators in the restaurant industry during recent months have led investors to believe a full recovery for the industry is around the corner.

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The restaurant industry is adding jobs at a rapid pace.  In September, the industry created 34,000 of the new 64,000 private sector jobs around the country.  Many of the new employees are recent college graduates looking to make a career in the industry.  With fewer opportunities available for college graduates, many are making the decision to enter into restaurant management programs at restaurants around the country.

For just $100,000, you can dress just like Lady Gaga.  The Old Homestead Steakhouse has recreated the raw meat dress the eccentric singer wore to the VMA’s.  The dress is made from more than 110 pounds of raw meat.  In case you do not want to wear the real thing, more reasonable versions of the outfit are expected to be one of the most popular costumes for adults this Halloween.

Saladworks has announced the addition of two new soups to their already long soup list.  The company is adding Creamy Roasted Corn Tomato with Smoked Cheddar and Hearty Chicken Pot Pie soup to the menu.  The new soups bring the total number of permanent soups on the menu to 15.  Each of the additions has less than 140 calories per serving.

In a bid to restart its growth, restaurant company Ruby Tuesday (RT) is going off its time-tested menu: Rather than expand its eponymous flagship chain, the company will make forays into Mexican, barbecue, and seafood dining it expects to be more profitable.

Ruby Tuesday, based in Maryville, Tenn., was arguably the hardest, and earliest, hit in a restaurant category—known as casual dining—that bore the brunt of American frugality over the past three years. According to Raymond James estimates, the chain’s individual restaurant sales dropped 20 percent from their peak in the second quarter of 2004 to their low in the third quarter of 2009. Its shares plummeted to an all-time low of 91¢ in March 2009 on bankruptcy fears.

“Some people in the investment community thought we wouldn’t survive,” Samuel “Sandy” Beall, Ruby Tuesday’s founder, chairman, president, and chief executive, tells Businessweek.com. “We didn’t think that.”

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Ruby Tuesday Inc.’s (RT) plan to operate other brands, including a competitor to Chipotle Mexican Grill Inc. (CMG) in the rapidly growing fast-casual space, comes as the restaurant company faces waning growth for its namesake brand as well higher costs mainly due to changes to the healthcare law.

Ruby Tuesday’s founder and Chief Executive Samuel “Sandy” Beall said in an interview Thursday that the prospect of higher labor costs was “definitely a factor” in the company’s recent licensing agreement to open and operate up to 200 Lime Fresh Mexican Grill locations over the next decade.

Lime Fresh, currently with seven locations in Florida, operates fast-casual restaurants, a format similar to Chipotle and Panera Bread Co. (PNRA) that offers meals at higher prices than fast food chains but without some of the costs, like table service, of a full-service restaurants.

“It’s a little simpler of an operation when it comes to healthcare — Obamacare — which could be devastating for the industry,” Beall said of Lime Fresh. Each Lime Fresh location may have about 20 full-time employees, compared with 60 to 70 at a typical Ruby Tuesday restaurant.

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Ruby Tuesday, Inc. (NYSE: RT) today reported financial results for the fiscal first quarter ended August 31, 2010.

Highlights for the first quarter of 2011 compared to the first quarter of 2010 include:

• Positive same-restaurant sales of 1.2% at Company-owned Ruby Tuesday restaurants
• Restaurant level operating margin of 18.5%, or 18.0% excluding accounting gains from franchise partner acquisitions of $1.7 million. The adjusted margin, an improvement of 210 basis points over the prior year, was primarily driven by lower levels of promotional activity.
• Net income of $12.4 million, or $10.7 million excluding accounting gains realized from franchise partner acquisitions, compares to prior-year net income of $6.1 million
• Diluted earnings per share of $0.19, or $0.17 per share excluding accounting gains noted above, compares to diluted earnings per share of $0.11 for the prior year
• Book debt to EBITDA ratio of 2.08 represents a sizeable improvement over the prior-year ratio of 2.84
• We have included a reconciliation of the franchise partner acquisition accounting gains noted above on the Investor Relations page of the Ruby Tuesday website: www.rubytuesday.com

Sandy Beall, Founder and CEO, commented on the results, saying, “We are excited to report another solid quarter and believe our strategies and repositioning efforts are showing sustained traction as our momentum has continued to build over the past year. The positive same-restaurant sales for the quarter, on lower promotional levels and in a continued difficult economic environment, are a strong testament to the new Ruby Tuesday. Our strategies going forward are to continue strengthening the business, resume growing the business, and further enhance shareholder value.”

Other highlights from our first quarter results include:

• Second consecutive quarter of positive same-restaurant sales, and outperformed Knapp-Track^TM, the industry benchmark
• Same-restaurant sales for domestic franchised restaurants increased by 0.4%
• Total revenue increased 0.7% from the same period of the prior year
• Sales at domestic and international franchise Ruby Tuesday restaurants (which is the basis for determining royalty fees included in franchise revenue on the Company’s statement of operations) totaled $91.1 million and $94.8 million for the first quarter of fiscal 2011 and 2010, respectively
• Acquired the Long Island and New England franchise partner businesses, which represent a total of 20 restaurants
• The Company did not open any new Ruby Tuesday restaurants and closed two restaurants
• Domestic and international franchisees opened three new Ruby Tuesday restaurants and closed three
• Total capital expenditures were $6.6 million

Mr. Beall said, “The improvements in our sales, operations, and balance sheet have allowed us to begin executing on our longer-term strategies to further strengthen and grow our business in order to rebuild shareholder value. Our key strategies for the next three to five years include the following four areas:

• Continue to Enhance the Quality of Our Core Brand – Our Ruby Tuesday brand restaurants will remain our primary focus. Over the past year, we have introduced several new key promotions and offerings, which we call ‘Game Changers,’ that have strengthened the brand. We launched our fall menu on August 24^th, along with our enhanced Sunday Brunch and Bar menus. Our new product offerings, including our complimentary garlic cheese biscuits and our Fit & Trim entrees, should continue to provide momentum for our brand. We will continue to invest in various initiatives from both a food quality and labor standpoint to facilitate our longer-term goal of providing a $25 high-quality casual dining experience for $15.
• Increase Revenue and EBITDA Through New Concept Conversions and Franchise Partnership Acquisitions – Part of our long-term plan is to convert certain underperforming Company-owned restaurants to other high-quality casual dining concepts. We opened our first converted Jim ‘N Nick’s Bar-B-Q in Knoxville on September 21^st and our first Truffles conversion will open in the Buckhead area of Atlanta in November. The low capital requirement for these conversions should provide attractive cash-on-cash returns for our shareholders. Another part of our plan is focused on generating incremental revenue and EBITDA from our current franchise partners. We completed two franchise partner acquisitions in the first quarter and are considering our options for the remaining franchise partners, which include potential additional acquisitions or conversion to traditional franchises over time.
• Focus on Low Risk, Low Capital-Intensive Growth – We are excited about the licensing agreement we recently entered into with Lime Fresh Mexican Grill, a Florida-based restaurant concept, which gives us the opportunity to operate up to 200 fast casual fresh-Mexican restaurants in the eastern United States, excluding Florida. Our growth with the Lime brand will primarily be in smaller, inline locations. The Lime brand is in alignment with our focus on high quality and offers great opportunities for us in the high-growth, high-quality, fast casual dining segment. We also plan on opening Company-owned, inline Ruby Tuesday restaurants as another segment of our growth strategy. The ability to enter the growing fast casual segment with a strong brand such as Lime and further expand our Ruby Tuesday Company-owned brand provides a growth option that should create long-term value for our shareholders with relatively low risk.
• Optimally Manage Excess Cash Flow – We have made great progress over the past year in strengthening our balance sheet and we will, in the short term, continue to leverage our free cash flow to pay down debt. As the cash flow from our core business continues to grow through current and new brand enhancements, and our conversions and inline growth begin to generate incremental cash flow, we will return the excess cash flow, which we are unable to accretively reinvest in the Company, to our shareholders.”

Fiscal Year 2011 Guidance

• Same-Restaurant Sales - We estimate same-restaurant sales for Company-owned restaurants will be in the range of flat to positive 2% for the year
• Company-Owned Restaurant Development - We expect to open one to two smaller prototype, inline restaurants in 2011, expect to close seven to nine Company-owned restaurants, and convert five to seven Company-owned restaurants to other high-end casual dining concepts. In addition to the 20 franchise restaurants acquired during our first fiscal quarter, we are evaluating the buy back of five to 10 additional franchise restaurants over the remainder of the fiscal year.
• Franchise Restaurant Development - We project our franchisees will open eight to 13 restaurants, up to 10 of which will be international
• Restaurant Operating Margins – Margins are anticipated to be relatively flat, primarily reflecting the impact of our continued investment in higher-quality menu items and new product offerings, as well as investments in service to enhance our guest experience and drive sales, offset by lower promotional levels. Our food costs are expected to remain relatively stable compared to the prior year.
• Other Expenses - Depreciation is projected in the $60-$63 million range and selling, general, and administrative expenses are targeted to be up 8%-10% from a year earlier, primarily reflecting higher advertising, training, and marketing research expenses. Interest expense is projected to be $10-$12 million and the effective tax rate is estimated to be 20-25%.
• Diluted Earnings Per Share for the year are projected to be in the $0.76-$0.86 range. Fully-diluted weighted average shares outstanding are estimated to be approximately 64.5 million for the year.
• Capital Expenditures are estimated to be $29-$33 million

In closing, Mr. Beall said, “We are excited with the improved results in our core Ruby Tuesday business and believe our repositioning efforts and investments in high-quality menu offerings, combined with targeted and effective marketing, have been the basis for our continued momentum. We first and foremost will continue to focus on making our Ruby Tuesday brand even stronger in the high-quality casual dining space. Additionally, we look forward to leveraging our future growth options and believe our long-range plan will enable us to rebuild shareholder value going forward.”

A FRESH NEW RUBY TUESDAY

Ruby Tuesday, Inc. has Company-owned and/or franchise Ruby Tuesday brand restaurants in 46 states, the District of Columbia, 15 foreign countries, and Guam. As of August 31, 2010, the Company owned and operated 674 Ruby Tuesday restaurants, while domestic and international franchisees (including Hawaii and Guam) operated 146 and 57 restaurants, respectively. Ruby Tuesday, Inc. is traded on the New York Stock Exchange (Symbol: RT).

The Company will host a conference call, which will be a live web-cast, this afternoon at 5:00 p.m. Eastern Time. The call will be available live at the following websites:

http://www.rubytuesday.com
http://www.earnings.com

Special Note Regarding Forward-Looking Information

This press release contains various forward-looking statements, which represent our expectations or beliefs concerning future events, including one or more of the following: future financial performance and restaurant growth (both Company-owned and franchised), future capital expenditures, future borrowings and repayments of debt, availability of debt financing on terms attractive to the Company, payment of dividends, stock repurchases, and restaurant and franchise acquisitions and refranchises. We caution the reader that a number of important factors and uncertainties could, individually or in the aggregate, cause our actual results to differ materially from those included in the forward-looking statements (such statements include, but are not limited to, statements relating to cost savings that we estimate may result from any programs we implement, our estimates of future capital spending and free cash flow, and our targets for annual growth in same-restaurant sales and average annual sales per restaurant), including, without limitation, the following: general economic conditions; changes in promotional, couponing and advertising strategies; changes in our guests’ disposable income; consumer spending trends and habits; increased competition in the restaurant market; laws and regulations affecting labor and employee benefit costs, including further potential increases in state and federally mandated minimum wages; guests’ acceptance of changes in menu items; guests’ acceptance of our development prototypes, remodeled restaurants, and conversion strategy; mall-traffic trends; changes in the availability and cost of capital; weather conditions in the regions in which Company-owned and franchised restaurants are operated; costs and availability of food and beverage inventory; our ability to attract qualified managers, franchisees and team members; impact of adoption of new accounting standards; impact of food-borne illnesses resulting from an outbreak at either Ruby Tuesday or other restaurant concepts; effects of actual or threatened future terrorist attacks in the United States; and significant fluctuations in energy prices.

Ruby Tuesday is making it easier to eat healthy while dining out, with the addition of lunch salads, more seafood, and new choices on the Fresh Garden Bar. In addition, a new “Fit & Trim” symbol appears next to items on the menu that have 700 or fewer calories.

Ruby Tuesday founder and CEO, Sandy Beall, says, “We’re giving our guests more options and making it easier for them to identify healthier choices with the inclusion of the Fit & Trim symbol. We’ve added new selections while keeping our focus on fresh ingredients and bold flavors.”

“These are great-tasting dishes,” says Peter Glander, Ruby Tuesday’s Executive Chef, “with absolutely no compromise on flavor.” He cites the Herb-Crusted Tilapia, one of the restaurants’ most popular seafood dishes, as an example. The tender, mild fish is crusted with panko garlic bread crumbs and topped with lemon-butter sauce. It’s served with fresh, steamed broccoli and white cheddar mashed potatoes and has less than 700 calories. A total of 16 entrees on the new menu are designated Fit & Trim.

“The new menu offers even more variety,” says Kimberly Grant, Ruby Tuesday’s Executive Vice President. “For example, our guests are free to choose which two side items they would like with any entrée selection.” And the number of side dishes is growing, with healthy additions that include fresh grilled green beans and fresh grilled asparagus. To make the selection process even easier, the choices are divided into three categories. “We have our Classics, our new Fit & Trim sides, and our Premium sides – a group that includes a new baked macaroni-and-cheese,” says Grant.

For the lunch crowd, Ruby Tuesday has added a Petite Lunch Salad offering. Smaller portions of the Grilled Salmon Salad, the Carolina Chicken Salad, and others are available until 4:00 p.m. “The Petite Lunch Salad is perfect if you’re on the go or looking for something lighter,” says Glander. Ruby Tuesday’s signature Fresh Garden Bar also now has more variety with the addition of pepperoncini, banana peppers, sun dried tomatoes, cauliflower, apples, and green olives.

Ruby Tuesday recently began serving complimentary fresh-baked Garlic Cheese Biscuits to all guests. “Our delicious biscuits are a savory, yet sweet accompaniment to the meal. They are made from scratch and baked fresh throughout the day so they’re delivered to the table piping hot,” says Glander. One final addition to the menu is the growing list of premium wines that includes Cellar No. 8, Gnarly Head, Bonterra, Coppola, and Rodney Strong, among others.

“Ruby Tuesday guests now have the freedom to choose, and not just their sides. They can create their own Baby-Back Rib Platter with Louisiana fried shrimp or chicken wings, or they can add lobster tails or Lobster Mac-n-Cheese to their steak entrée for just $5 more,” says Beall. The CEO says he is confident guests are going to like the new menu, based on feedback from the test markets. “It’s clearly a departure from the not-always-fresh food that is still common at typical bar-and-grill restaurants,” says Beall.

All of the new menu changes are a continuation of Ruby Tuesday’s “Fresh Taste, Fresh Place” brand transformation. In 2005, the company began a reimaging initiative that included a focus on fresher food and gracious hospitality and concluded with the creation of a contemporary new look for its restaurants. The updated look, feel, and menu offerings are all important components of Ruby Tuesday’s mission to consistently provide a high-quality, casual dining experience with compelling value that guests will enjoy and remember.

Ruby Tuesday is increasing its franchised restaurant presence in Hawaii. RT Hawaii Restaurants, Inc. plans to open three new Ruby Tuesday restaurants within the next three years; the first restaurant is slated to open in June 2011. Principal investors in the company, Ted Davenport and Rick Nakashima, are proven leaders. They currently own and operate Ruby Tuesday restaurants in Honolulu, Mililani, and Kaneohe.

“We look forward to developing again in Hawaii,” Nakashima said. “We opened our first restaurants between 2004 and 2006 and we’re very excited to expand from our current four restaurants to seven,” he added.

Ruby Tuesday is passionate about great food and gracious hospitality. Ruby Tuesday’s menu offers a fresh garden bar, premium seafood entrées, including lobster, and quesadillas, as well as classic favorites like Ruby Minis, handcrafted burgers and ribs. In 2005, the company began a reimaging initiative that included a focus on food and service and concluded with the creation of a fresh new look for its restaurants. The updated look, feel, and menu offerings are all important factors of Ruby Tuesday’s mission to consistently provide a high-quality, casual dining experience with compelling value that guests will enjoy and remember.

“Thanks to the outpouring of support from the local communities, military and tourists, we have enjoyed great success in the state of Hawaii,” said Davenport. “Ruby Tuesday is a proven concept and we’re confident these additional restaurants will be as successful as the others. We are very grateful for our loyal guests,” added Davenport.

Max Piet, Vice-President of Franchise Operations, said, “The response in Hawaii has been phenomenal. We are very pleased to grow our brand with two passionate and successful businessmen like Ted and Rick.”

In the 2011 fiscal year, Ruby Tuesday franchisees expect to open eight to 13 restaurants, up to 10 of which will be international.

DineEquity, Inc. has reached an agreement to sell 63 Applebee’s Neighborhood Grill & Bar restaurants to Apple American Group for $32 million.  The units are located in Minnesota and Wisconsin.  Apple American, Applebee’s largest franchisee, currently owns and operates 206 Applebee’s restaurants. 

Domino’s Pizza multi-store franchisee Pali Grewal won the company’s 2010 World’s Fastest Pizza Maker competition this week.  Grewal hand-stretched and topped three large pizzas in just over 39 seconds. 

With 700 locations in 10 states, Whataburger is closing in on its 60th anniversary.  The company announced that it will celebrate the occasion on August 3rd by giving away a free Whataburger between 5 and 8 p.m. to every dine-in customer dressed in orange.

Burger King Corp. has announced that it will roll out a nutritionally-balanced kids meal for breakfast on Monday, July 26th.  The breakfast meal will feature a new Kids Breakfast Muffin Sandwich, Fresh Apple Fries and calcium-fortified Minute Maid apple juice. 

Carl’s Jr. has introduced the latest addition to its summer menu, the Hawaiian Grilled Chicken Salad.  The new salad includes grilled and sliced chicken breast, grilled Dole pineapple, red onions and sliced cucumbers topped with an Asian sesame dressing.

Despite a 4.3% dip in revenues, Ruby Tuesday reported a $45.3 million bottom line for 2010 compared to 2009′s $17.9 million net loss.  The company also reported this week that Dan Dillon has been named as Senior Vice President of Brand Development.  Dillon’s last position was as Chief Marketing Officer with OSI Restaurant Partners, parent company of Outback Steakhouse. 

On Wednesday, Frances Allen joined Denny’s Corporation as Chief Marketing Officer and Executive Vice President.  She brings to the table extensive leadership experience with Sony Ericsson, Pepsi-Cola and Frito-Lay.  In addition, she was Chief Marketing Officer for Dunkin’ Brands from 2007 to 2009 where she was named “Marketer of the Year” by BrandWeek Magazine.

Blimpie has rolled out its new healthy menu line called The Lighter Stuff.  The new menu includes six items under 400 calories and six grams of fat.  It features the Deli Trio Sub, the Asian Teriyaki Chicken Sub, the Veggie Salad Sub, the Turkey and Sweet & Spicy Mustard Sub, the Ham and Pepper Relish Sub and the Buffalo Chicken Salad.

McDonald’s global sales are up 15% for the second quarter ending June 30th, with new frozen beverages and the Dollar Menu driving U.S. sales.  The company reports a net income of $1.23 billion.

With 1,000 restaurants now open, Chipotle Mexican Grill has reported second quarter revenues of $466.8 million, up 20.1% vs. last year.  Net income rose to $46.5 million, a 31.3% increase.  Chipotle opened 25 new restaurants during the quarter.

The Cheesecake Factory closed out its second quarter on June 29th and reports a 1.6% increase in revenue.  Net income was $19.2 million vs. $16.6 million last year.

Four years ago, the typical Ruby Tuesday had Tiffany lamps and roller skates hanging on the walls and sold lots of burgers and beer. Now, the company is trying to cope with the decline of the “fast casual” dining category by changing its approach.

Ruby Tuesday has upgraded its menu in a bid to break out of a ferocious competition with Applebee’s, Chili’s and T.G.I. Friday’s, with which it is often compared. In Atlanta, where it has about a dozen restaurants, Ruby Tuesday has rolled out or plans to introduce new mahi-mahi, salads, garlic cheese biscuits, steaks and trout.

In the summer of 2008, as the economic downturn crimped the fast casual category, Ruby Tuesday worked on a $100 million project to renovate the interior of its restaurants. It was a risky move, especially given the chain’s small size relative to larger competitors Applebee’s and Chili’s. Then, as now, there is the possibility that any gains will be a zero-sum game, as the crowded category continues to shrink.

Continue reading . . .

They are huge in the US, but few British diners have heard of Chipotle Mexican Grill (CMG) or Ruby Tuesday (RT). But all this is about to change as the restaurant chains join Taco Bell in a three-pronged US attack on the British market this summer.

Chipotle, the burrito chain with nearly 1,000 restaurants across America, opened its first UK outlet in London in May and Taco Bell, the world’s largest Mexican-inspired chain, will arrive in Essex this month.

Ruby Tuesday – the American casual dining chain is named after the Rolling Stones song and has more than 900 outlets around the world – opened its first UK outlet in Cardiff’s St David’s shopping centre last month. None of the three has come over here to make up the numbers, and sizeable expansion plans are afoot.

Nick Dawson, the general manager for UK and Europe at Taco Bell, the Yum Brands-owned quick-service restaurant (QSR) operator, said: “This will be the first of a long existence in the UK.”

Continue reading . . .

Ruby Tuesday, Inc. announces six primary sponsorship races with Penske Racing and Aaron’s 312 Nationwide Series winner, Brad Keselowski. The No. 22 Ruby Tuesday Dodge Charger will make its debut in the Nationwide Series on Friday, April 30, at the BUBBA burger 250 race in Richmond, VA.

“We’re excited to compete in our first primary race with Brad and the Penske team,” said Mark Young, Ruby Tuesday’s Chief Marketing Officer. “Brad’s win at Talladega on Sunday and his track record this season is impressive and we feel good about the opportunities for more big wins.” Ruby Tuesday is primary sponsor for six races and associate sponsor for the other races on the No. 22 car in the 2010 Nationwide Series. “Penske Racing is one of the most successful teams in sports history and I think our passion and commitment to excellence are very much aligned,” added Young.

The No. 22 Ruby Tuesday Dodge Charger will take to the track in five other races in the Nationwide Series: Darlington Raceway on May 7, Dover International Speedway on May 15, New Hampshire Motor Speedway on June 26, Richmond International Raceway on September 10 and Dover International Speedway on September 25.

Keselowksi, voted most popular driver by the fans on the NASCAR Nationwide Series circuit in 2008 and 2009, is eager to capture a win for the Ruby Tuesday team. “Ruby Tuesday is an organization with passion and pride in all it does and I think this is the beginning of a great relationship,” said Keselowski. “We’ve enjoyed the partnership and successes with Ruby Tuesday this season and we’re looking forward to getting them to Victory Lane with Penske Racing and the No. 22 team.”

Keselowski, in his first season with Penske Racing, currently leads the 2010 NASCAR Nationwide Series driver and owner point standings.

About Ruby Tuesday

Ruby Tuesday, Inc. has company-owned and/or franchise Ruby Tuesday brand restaurants in 46 states, the District of Columbia, Guam, and 14 foreign countries. As of March 2, 2010, the company owned and operated 659 Ruby Tuesday restaurants, while domestic and international franchisees (including Hawaii) operated 168 and 57 restaurants, respectively. Ruby Tuesday, Inc. is traded on the New York Stock Exchange (Symbol: RT).

For information about Ruby Tuesday, please visit the company website at www.rubytuesday.com or on Facebook at www.facebook/rubytuesday.

About Penske Racing

In 2010, Penske Racing competes in the NASCAR Cup Series with former Cup Series champion Kurt Busch and the No. 2 Miller Lite Dodge, former three-time IndyCar Series champion Sam Hornish Jr. in the No. 77 Mobil 1 Dodge and Brad Keselowski in the No. 12 Penske Dodge. The team also races in the Nationwide Series with Justin Allgaier, the 2009 series Rookie of the Year, in the No. 12 Verizon Dodge and multiple race-winner Keselowski driving the No. 22 Discount Tire and Ruby Tuesday Dodge. Competing in a variety of disciplines, cars owned and prepared by Penske Racing have produced more than 315 major race wins, over 370 pole positions and 22 national championships.

For more information about Penske Racing, please visit www.penskeracing.com.

Ruby Tuesday, Inc. (NYSE: RT), will be presenting at the Barclays conference in New York. The presentation is scheduled for Wednesday, April 28^th at 8:45 a.m. Eastern time. The live presentation will be available to interested parties via an audio webcast at the website below:

www.rubytuesday.com (on the Investor Relations page of the Company’s website)

The presentation will be archived through May 12, 2010.

Ruby Tuesday, Inc. (NYSE: RT) owns and operates and franchises nearly 900 restaurants throughout the United States and in selected international locations.

Ruby Tuesday, Inc. (NYSE: RT) today reported diluted earnings per share of $0.28 on net income of $17.8 million for the Company’s third quarter of fiscal 2010, which ended on March 2, 2010. This compares to earnings of $0.09 per diluted share on net income of $4.8 million for the third quarter of the prior year. Closure and impairment expenses were $2.3 million pretax ($0.02 per diluted share after tax) in the third quarter of this year, compared to $14.3 million ($0.17 per diluted share after tax) in the third quarter of the prior year. Included in prior year expenses were charges related to the Company’s restructuring announced in December 2008.

As previously announced, same-restaurant sales for the third quarter decreased 0.7% at Company-owned Ruby Tuesday restaurants; severe winter weather in many of the Company’s core markets reduced same-restaurant sales by an estimated 1.5% to 2%. Same-restaurant sales at domestic franchised restaurants declined 5.3%.

Sandy Beall, Founder and CEO, commented on the results, saying, “We are very encouraged with the momentum in our business and excited to report five consecutive quarters of improving trends since our sales and traffic first began to improve in last year’s third quarter. Despite this more difficult comparison, the quarter was one of our best in terms of sales in three years. We believe our repositioning efforts and investments in quality menu options, combined with targeted and effective marketing, are driving improved results. Although the economic environment remains uncertain, there are signs of improvement and we are working hard to end our fiscal year with strength and continued momentum.”

Highlights from our third quarter results include:

• Same-restaurant sales were down 0.7%.
• Restaurant operating margins increased in the quarter reflecting the positive impact from store closings, more efficient labor scheduling, and the success of our cost reduction efforts.
• Debt was reduced another $43 million during the quarter, bringing the year-to-date total debt paydown to $171 million, including $73 million from the proceeds of the sale of 11.5 million shares of stock through an equity offering in July.

“We continued to make solid progress against our top priorities for the year. Our first goal is to increase same-restaurant sales and get guests in seats. The modest increase in same-restaurant sales in January and February were the first monthly increases in three years and we were able to effectively balance the relationship between average check and traffic to the benefit of profitability. The emphasis on our second goal, maximizing our cash flow and reducing debt, has resulted in an improved balance sheet and leverage ratios. We have paid down approximately $283 million of debt since the end of fiscal 2008, or nearly 47% of the total then outstanding in less than two years. As a result, our book debt to EBITDA ratio has declined to 2.2 at the end of the third quarter, from 3.7 at the end of fiscal 2008. Our third priority is to further strengthen and differentiate our brand through quality and remaining true to our core operating strategies: Uncompromising Freshness and Quality of our food; service with Gracious Hospitality; a Fresh New Look for our restaurants; and Compelling Value. Towards these objectives, we continue to focus on operations, the menu, and other enhancements to the brand such as the addition of lobster tails and our four-course Sunday brunch and the installation of new high definition flat screen televisions in our bar areas. We believe these strategies are key contributors to the momentum in our business.”

Other highlights for the 13-week third quarter included:

• Total revenue declined 3.2% from the same period of the prior year primarily because of 12 fewer restaurants in operation and the decrease in same-restaurant sales.
• The Company closed 11 restaurants and did not open any restaurants during the quarter.
• Domestic and international franchisees opened one and closed three restaurants.
• Sales at domestic and international franchise Ruby Tuesday restaurants (which is the basis for determining royalty fees included in franchise revenue on the Company’s statement of operations) totaled $91.9 million and $96.8 million for the third quarter of fiscal 2010 and 2009, respectively.
• Total capital expenditures were $3.8 million.
• The Company had approximately 64 million shares of common stock outstanding at the end of the quarter.

Fiscal Year 2010 Guidance

• New restaurant development – No new Company-owned Ruby Tuesday restaurants will be opened in fiscal 2010 and a total of 14 are projected to close, including one in the fourth quarter, as part of our previously announced plan to close 30 restaurants over time when their leases expire. We expect domestic franchisees will open two or three restaurants during the year, including one or two in the fourth quarter. We expect international franchisees will open three to five restaurants during the year, including up to two in the fourth quarter.
• Same-restaurant sales – We estimate same-restaurant sales for the year for Company-owned restaurants will be down approximately 1% to 2%.
• Restaurant operating margins are anticipated to be down primarily reflecting the impact of our marketing strategy to emphasize Compelling Value and its impact on food costs as a percentage of sales.
• Other expenses – Depreciation is projected in the $63-65 million range and selling, general, and administrative expenses are targeted to be down 10-12% from a year earlier. Interest expense is projected to be $16-17 million and the tax rate is estimated to be 20-22%. Fully diluted weighted average shares outstanding are estimated to be approximately 62 million for the year.
• Diluted earnings per share for the year are projected to be in the $0.60-0.65 range.
• Capital expenditures for the year are estimated to be $18-20 million.

Mr. Beall added, “We are pleased with our results in the third quarter and are excited by the momentum in our business. Our top priorities continue to be to increase average restaurant sales and traffic, to maximize cash flow and pay down debt, and further strengthen and differentiate our brand. With the improvement in our balance sheet, we are now able to develop longer term strategies to further increase sales, cash flow, and return on assets. All our actions are in keeping with our mission statement: to be the best in the bar grill segment of the restaurant industry by delivering a high-quality casual dining experience with compelling value.”

Ruby Tuesday, Inc. has Company-owned and/or franchise Ruby Tuesday brand restaurants in 46 states, the District of Columbia, Guam, and 14 foreign countries. As of March 2, 2010, the Company owned and operated 659 Ruby Tuesday restaurants, while domestic and international franchisees (including Hawaii) operated 168 and 57 restaurants, respectively. For more information on Ruby Tuesday, please visit our company website at www.rubytuesday.com. Ruby Tuesday, Inc. is traded on the New York Stock Exchange (Symbol: RT).

Ruby Tuesday – with more than 800 casual dining restaurants across the U.S. – is giving guests and NCAA basketball fans alike a chance to win $1 million cash in its 2010 Million Dollar Bracket Challenge Sweepstakes. Guests can enter to win by completing their brackets on Ruby Tuesday’s Facebook page through a custom-built application created especially for its guests.

“Ruby Tuesday is the place to be for March Madness,” says Kimberly Grant, Ruby Tuesday’s Executive Vice-President. “Not only do you have the chance to win a million dollars, but you can meet up with friends at your local Ruby Tuesday to watch your favorite teams play in high-definition.” Ruby Tuesday recently installed new high-definition televisions in all its restaurants and, where DirecTV is available, restaurants will show all of the games with the NCAA Mega March Madness Package. During game days, all guests seated in the bar area can take advantage of $2 off any appetizer, one-of-a-kind $5 premium well cocktails, and an adventurous craft beer line-up.

Registration for the $1 million prize will begin on Sunday, March 14 at 10 p.m. and end at 9 a.m. EST on Thursday, March 18. “If you miss out on the perfect bracket, not to worry,” says Grant, “this is not a single elimination contest, so you can still win great prizes.” As the tournament progresses, guests have several ways to win: the traditional overall million dollar bracket, round-by-round play and by inviting Facebook friends to enter. Participants who fill out their brackets before the start of each round are registered to win high-end consumer electronics including 46” Sony LCD TVs, Sony Home Theater Systems, digital cameras and much more.

There is a social media component to this sweepstakes as well. “The more Facebook friends you recruit to enter, the more chances you have to win great prizes,” says Grant. More information about the Million Dollar Bracket Challenge, including the official sweepstakes rules, can be found at Facebook.com/RubyTuesday.

About Ruby Tuesday

Ruby Tuesday, Inc. has company-owned and/or franchise Ruby Tuesday brand restaurants in 46 states, the District of Columbia, Guam, and 14 foreign countries. As of March 2, 2010, the Company owned and operated 659 Ruby Tuesday restaurants, while domestic and international franchisees (including Hawaii) operated 168 and 57 restaurants, respectively. For more information on Ruby Tuesday, please visit the company website at www.RubyTuesday.com. Ruby Tuesday, Inc. is traded on the New York Stock Exchange (Symbol: RT).

Ruby Tuesday, Inc. (NYSE: RT) today announced that same-restaurant sales for Company-owned restaurants were -0.8% to -1.0% in the third quarter ended March 2, 2010, compared to the same quarter of the prior year. Severe weather during the quarter is estimated to have reduced same-restaurant sales by 1.5-2%. Same-restaurant sales at domestic franchised restaurants decreased 5.3-5.5% in the third quarter compared to the same quarter of the prior year.

Sandy Beall, Founder and CEO, commented, “We are excited about the trends we are seeing in the Ruby Tuesday brand. Our same restaurant sales have improved sequentially over the past five quarters and were the best they have been in three years, even increasing slightly in January and February, despite the worst weather in memory across many of our core markets. On top of this, comparisons were more difficult because we began to lap improving same-restaurant sales and guest traffic during the third quarter of fiscal 2009 as awareness of the “New Ruby Tuesday” grew in response to our marketing efforts. We believe that our key brand initiatives of “Uncompromising Freshness and Quality, Gracious Hospitality, a Fresh New Look and Compelling Value” are resonating with our guests. Our primary objectives going into fiscal year 2010 were to increase sales and traffic, maximize cash flow, reduce our debt and to further strengthen our brand and we are definitely delivering on these goals. While the macro-environment remains unclear, we are confident in our strategies. Our sales are strengthening, costs are in good shape, and guest satisfaction scores continue to be solid.”

Ruby Tuesday will be presenting at the Bank of America Merrill Lynch consumer conference in New York City on Wednesday, March 10^th at 11:45 a.m. The live presentation and subsequent replay will be available on the Investor Relations page of the Company’s website at www.rubytuesday.com.

The Company will report full third quarter results on Wednesday, April 7, 2010 after the market close.

Ruby Tuesday, Inc. has Company-owned and/or franchise Ruby Tuesday brand restaurants in 46 states, the District of Columbia, Guam, and 14 foreign countries. As of March 2, 2010, the Company owned and operated 659 Ruby Tuesday restaurants, while domestic and international franchisees (including Hawaii) operated 168 and 57 restaurants, respectively. For more information on Ruby Tuesday, please visit our company website at www.rubytuesday.com. Ruby Tuesday, Inc. is traded on the New York Stock Exchange (Symbol: RT).

Although Valentine’s Day is on a Sunday this year, Ruby Tuesday will be “sharing the love” all weekend long. On February 12th, 13th and 14th, guests at Ruby’s can enjoy a special Valentine’s Dinner for Two that begins with a shared appetizer, includes two entrées, and ends with a romantic shareable dessert – all for only $19.99 per person.

• Ruby Tuesday Gift Card Collection

After beginning with a craveable, generous-enough-for-two appetizer of Thai Phoon Shrimp, Spinach Artichoke Dip, Beef Queso Dip, or Southwestern Spring Rolls, guests can choose their main course from 18 premium entrées. Featured choices include any seared-to-perfection steak, a full rack of Ruby’s famous fork-tender ribs, the ever popular Chesapeake Catch and New Orleans Seafood, Asian Glazed Salmon, Salmon Florentine, or any premium lobster entrée. Lobster dinners include Lobster Tails, Lobster Carbonara, Steak & Lobster Tail, Lobster New Orleans and the amazing Steak & Lobster Mac and Cheese.

“This Valentine’s-weekend offer includes so many of our premium specialty dishes, couples can enjoy the ones they love along with the great value of the dinner-for-two special,” says Kimberly Grant, Ruby Tuesday’s Executive Vice President. “Why not treat your sweetheart to lobster this year in addition to flowers and chocolates?” she suggests.

Grant says of the bountiful seafood selection: “We unveiled some fabulous new dishes on our new menu a few months ago, and we can assure our guests they won’t find a higher-quality lobster or seafood dish for a better value than at Ruby Tuesday.”

By ordering the Valentine’s Dinner for Two for $19.99 per person, couples can enjoy a bottle of their favorite wine or a Ruby Relaxer or Cosmopolitan cocktail with their savings. Ruby Tuesday recently introduced a premium cocktail menu that offers countless choices of $5 margaritas, martinis, mojitos, and classic cocktails, all prepared with premium brands such as Bacardi, Beefeater, Smirnoff, and Sauza.

And just in time for this lover’s holiday, Ruby Tuesday will be adding an authentic Italian Tiramisu to its already luscious line-up of dessert offerings. It’s made with mascarpone cheese and lady fingers soaked in rum and coffee liqueur. Other shareable dessert choices for Valentine’s Day are a moist Italian Cream Cake, rich and creamy New York Cheesecake, or a warm Double Chocolate Cake. “What better way to end a romantic meal than by sharing a slice of heaven with the one you love?” asks Grant.

Ruby Tuesday is one of the few casual dining restaurants to offer online reservations. As an added convenience and a great way to avoid the wait, especially on the popular holiday weekend, make your reservation in advance by visiting www.RubyTuesday.com.

More information about the Valentine’s Dinner for Two special can also be found on Facebook at www.Facebook.com/RubyTuesday.

Ruby Tuesday, Inc. has company-owned and/or franchise Ruby Tuesday brand restaurants in 46 states, the District of Columbia, Guam, and 14 foreign countries. As of December 1, 2009, the Company owned and operated 670 Ruby Tuesday restaurants, while domestic and international franchisees (including Hawaii) operated 171 and 55 restaurants, respectively. For more information on Ruby Tuesday, please visit the company website at www.RubyTuesday.com. Ruby Tuesday, Inc. is traded on the New York Stock Exchange (Symbol: RT).

Goodbye, old Ruby Tuesday. Known for decades for its casual burger-and-salad restaurants, the nearly 40-year-old chain has undergone an aggressive $100 million makeover that started just before the recession sapped many restaurant companies of their earnings.

But finally, analysts say, the risky menu switch, as well as a cultural shift in how Ruby Tuesday approaches the food business, may be paying dividends with a return to profits and brighter prospects for the roughly 900-unit chain.

Among a number of more upscale menu additions are herb-crusted tilapia, North Atlantic lobster tails and red wine pairing with steak dishes — all designed to boost the average ticket price diners pay and differentiate Ruby Tuesday from other value-based chains pitching customers with discounts, coupons and two-for-one specials.

The catch was that Ruby Tuesday’s chairman, president and CEO, Sandy Beall, hit his brand’s start-over button just as many consumers faced job losses, home loan problems and other pressures that led them to keep tighter reins on spending. Few people dined out, and sales at the chain’s company-owned stores open a year or more fell.

Continue reading . . .

• Ruby Tuesday, Inc. Business Background Report
• Ruby Tuesday Gift Card Collection