Bloomin' Brands (BLMN) Q2 2024 earnings summary

Executive summary

• Q2 2024 adjusted diluted EPS was $0.51 and GAAP diluted EPS was $0.32, with U.S. comparable sales down 0.1% but outperforming the industry, and total revenues at $1.12 billion, down 2.9% year-over-year.

• The casual dining industry was softer than anticipated, leading to updated full-year guidance and a focus on guest experience, menu simplification, and digital marketing.

• Asset upgrades continue, with 60-65 remodels and 40-45 new openings planned for 2024, including 20 in Brazil.

• Off-premises sales remain strong at 24% of U.S. sales, with Carrabba's catering up 180% over two years.

• The company is reviewing strategic alternatives for its Brazil operations, including a possible sale.

Financial highlights

• Q2 total revenues were $1.12 billion, down 2.9% year-over-year, mainly due to lower comparable sales, net closures/openings, and loss of Brazil VAT exemption.

• U.S. comparable sales were down 0.1%; traffic declined 3.8% year-over-year.

• Q2 GAAP diluted EPS was $0.32 (vs. $0.70 in 2023); adjusted EPS was $0.51 (vs. $0.70 in 2023).

• Adjusted operating margin was 5.7% (vs. 7.8% last year), impacted by higher labor, advertising, and depreciation, partially offset by lower food and beverage costs.

• Restaurant-level operating margin was 14.3%, down from 16.4% year-over-year.

Outlook and guidance

• Full-year 2024 U.S. comparable sales guidance updated to flat to down 1%, reflecting a softer industry environment.

• Adjusted diluted EPS guidance for 2024 is $2.10–$2.30, with a wider range due to industry volatility.

• Q3 U.S. comparable sales expected to be flat to down 2%; Q3 adjusted EPS guidance is $0.17–$0.25.

• Capital expenditures guidance lowered to $260–$270 million.

• Brazil VAT exemption to provide a $0.15 benefit in 2024, mostly in the second half.