Bloomin’ Brands, the parent company of Outback Steakhouse, Bonefish Grill, and other restaurant chains, is closing 36 underperforming restaurants along with five Aussie Grill eateries, the company said when releasing fourth-quarter and year-end results.
A spokesperson for the Tampa, Florida, U.S.A.-based company, which also operates Fleming’s Prime Steakhouse and Wine Bar and Carrabba’s Italian Grill, told Restaurant Business some of the closures were already completed, and 33 would take place on 23 February.
According to CNN, Outback locations in Pennsylvania and Iowa; Bonefish Grill locations in New Jersey and Virginia; and at least three Carrabba’s locations in New York were among the restaurants terminated by Bloomin' Brands.
The company recently closed three Outback Steakhouse locations in Hawaii, giving just two days’ notice to employees, per The Sun. Bloomin’ Brands did not respond to SeafoodSource’s request for comment on the closures.
In the fourth quarter, the company “made the decision to close 36 predominantly older, underperforming restaurants, as well as three U.S. and two international Aussie Grill restaurants,” Bloomin’ Brands said. As a result, the company will incur net closure charges of USD 32.3 million (EUR 30 million) in Q4 2023.
“This decision considered a variety of factors including sales, traffic-trade areas, and the investment that would have to be made to improve the restaurants,” Bloomin’ Brands CEO David Deno said. “Despite this initiative, our confidence in our portfolio remains high as we plan to open 40 to 45 new restaurants across the system in 2024.”
Bloomin’ Brands also plans to increase its 2024 marketing spend by USD 20 million (EUR 18.5 million) to build traffic. However, the company’s net income fell from USD 58 million (EUR 53.6 million) in Q4 2022 to USD 43.3 million (EUR 40 million) in Q4 2023. Its revenue, meanwhile, rose from nearly USD 1.1 billion (EUR 1 billion) in Q4 2022 to USD 1.19 billion (EUR 1.1 billion) in Q4 2023 primarily due to restaurant sales during the 53rd week of 2023, the effect of foreign currency translation, and the net impact of restaurant openings and closures.
Carrabba’s was the only Bloomin’ brand that realized a comparable store sales increase in the fourth quarter, with that figure up about 3 percent year over year. Sales at Bonefish Grill dropped 3 percent, and sales at Outback and Fleming’s each declined 0.3 percent.
Deno said that while the U.S. consumer is “hanging in there … we also recognize the consumer may be more careful with their discretionary spending.”
“We will continue to be thoughtful of our approach to overall pricing and discounting,” he said.
