Del Frisco's (DFRG) Guides Q4 Revenues Below the Street

Del Frisco’s Restaurant Group, Inc. (NASDAQ: DFRG) today reported preliminary and unaudited sales results for the fourth quarter 2018 ended December 25, 2018.

13-Week Fourth Quarter 2018 Compared to the 16-Week Fourth Quarter 2017

Del Frisco’s expects consolidated revenues between $124.3 million and $124.7 million (*** consensus is $126.5 million) for the 13-week fourth quarter 2018, representing a 23.8% to 24.2% increase compared to $100.4 million for the 16-week fourth quarter 2017. All results exclude any contributions from Sullivan’s, which was sold in the third quarter of 2018, and which sale is reflected as discontinued operations for the fourth quarter of 2017. The increase is due primarily to $34.3 million in contributions from Barcelona Wine Bar and bartaco (together, “Emerging Brands”), which were acquired on June 27, 2018, and offset by three fewer calendar weeks in the fourth quarter of 2018 compared to the fourth quarter of 2017 as a result of our change in the fiscal quarter calendar.

Comparable Restaurant Sales

Fourth Quarter 2018 Development

• A Del Frisco’s Double Eagle Steakhouse restaurant in San Diego, CA.
• A bartaco restaurant in each of Fort Point, MA, and Dallas, TX.
• A Del Frisco’s Grille restaurant in each of Philadelphia, PA and Fort Lauderdale, FL.

These openings contributed to a record nine restaurant openings in 2018 consisting of three Del Frisco’s Double Eagle Steakhouses, three Del Frisco’s Grilles, and post-acquisition three bartacos. There were an additional three restaurant openings at Emerging Brands, consisting of one Barcelona Wine Bar and two bartacos, in 2018 prior to the acquisition. These restaurants will contribute meaningfully to our Adjusted EBITDA growth in 2019 and beyond.

Norman Abdallah, Chief Executive Officer of Del Frisco's, said, “Slightly positive comparable restaurant sales during the fourth quarter reflected weaker trends in November than October as we rolled over new menu launches and marketing support from 2017 but an upswing in December has encouragingly carried over year-to-date in 2019 across all four brands. Similar to the third quarter, Double Eagle’s comparable restaurant sales primarily reflected sales transfer from the Boston Double Eagle to the new Boston Back Bay Double Eagle, and would have increased 1.5% excluding this planned sales transfer. Private dining sales during the fourth quarter at Double Eagle and Grille rose 8.9% and 13.8% on a comparable basis, respectively, reflecting the strength of the business customer despite volatile capital markets as we effectively marketed our improved banquet menu offerings and focused on ensuring a flawless experience from beginning to end.”

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