(Updated February 22, 2019 8:33 AM EST to correct revenues and heading)

Ruth's Hospitality Group (NASDAQ: RUTH) reported Q4 EPS of $0.50, $0.01 better than the analyst estimate of $0.49. Revenue for the quarter came in at $127.15 million versus the consensus estimate of $126.83 million.

Highlights for the 13-week fourth quarter of 2018 compared to the 14-week fourth quarter of 2017 were as follows:

• Restaurant sales in the 13-week fourth quarter of 2018 increased 2.3% to $120.0 million compared to $117.4 million in the 14-week fourth quarter of 2017. Average unit weekly sales were $117.8 thousand in the fourth quarter of 2018, an increase of 0.4% compared to $117.4 thousand in the fourth quarter of 2017.
• Net income in the fourth quarter of 2018 was $14.9 million, or $0.49 per diluted share, compared to net income of $9.6 million, or $0.31 per diluted share, in the fourth quarter of 2017.
  • Net income in the fourth quarter of 2018 included $0.3 million in acquisition-related expenses associated with the acquisition of the six restaurants from our Hawaiian franchisee. Net income in the fourth quarter of 2017 included a $3.9 million non-cash charge related to the impairment of assets at one restaurant location, $0.6 million in acquisition-related expenses associated with the acquisition of our Hawaiian franchisee, and a discrete income tax charge of $1.2 million primarily related to the reduction of deferred tax assets from the Tax Cuts and Jobs Act.
  • Excluding these adjustments, non-GAAP diluted earnings per common share were $0.50 in the 13-week fourth quarter of 2018, compared to $0.44 in the 14-week fourth quarter of 2017. The Company believes that non-GAAP diluted earnings per common share provides a useful alternative measure of financial performance to improve comparability of diluted earnings per common share between periods. Investors are advised to see the attached Reconciliation of non-GAAP Financial Measure table for additional information.
• During the fourth quarter of 2018, the Company returned $28.9 million through its dividend program, debt repayment and the repurchase of 464 thousand shares of common stock for $12.6 million.
• One Company-owned Ruth’s Chris Steak House restaurant, one new franchised restaurant and one restaurant operating under a contractual agreement opened in the fourth quarter.

Cheryl Henry, President and Chief Executive Officer of Ruth\'s Hospitality Group, Inc., stated, “I’m proud of all that our team accomplished in both the fourth quarter and the full year. For the full year, we grew revenue by 9%, expanded restaurant level margins to the highest levels in over 10 years, successfully integrated our six Hawaiian franchise locations, and opened 3 new Company-operated and 2 new franchise restaurants.”

Henry added, “In addition, 2018 marked the 9th consecutive year of comparable restaurant sales and earnings growth. This success has been driven by our intense focus on operational excellence, and I’d like to thank all of our team members and franchisees for their incredible work each and every day.”

Financial Outlook

Based on current information, Ruth\'s Hospitality Group, Inc. is providing its full year 2019 outlook based on a 52 week year ending December 29, 2019, as follows:

• Food and beverage costs of 28.0% to 30.0% of restaurant sales
• Restaurant operating expenses of 48.0% to 50.0% of restaurant sales
• Marketing and advertising costs of 3.4% to 3.6% of total revenue
• General and administrative expenses of $35 million to $36 million
• Effective tax rate of 17% to 19%, excluding discrete income tax items
• Capital expenditures of $30 million to $32 million resulting in depreciation expense of $19.5 million to $21.5 million.
• Fully diluted shares outstanding of 30.0 million to 30.5 million (exclusive of any future share repurchases under the Company's share repurchase program)

For earnings history and earnings-related data on Ruth's Hospitality Group (RUTH) click here.