Bloomin' Brands (BLMN) Q3 2024 earnings summary

Executive summary

• Q3 2024 revenues declined 3.8% year-over-year to $1.04 billion, driven by lower comparable sales, FX headwinds, and net restaurant closures.

• U.S. comparable restaurant sales fell 1.5%, with traffic down 4.4%, and operating income dropped to $17.2 million from $58.2 million in Q3 2023.

• Adjusted diluted EPS was $0.21, down from $0.41 last year, impacted by asset impairments, executive transition costs, and strategic initiative expenses.

• Strategic partnership announced to sell 67% of Brazil operations to Vinci Partners for R$1.4 billion (~$243 million), retaining 33% ownership and ongoing royalty stream.

• Leadership transition completed, with new CEO emphasizing operational excellence, guest experience, and growth mindset.

Financial highlights

• Q3 GAAP diluted EPS was $0.08 versus $0.45 in 2023; adjusted EPS was $0.21 versus $0.41.

• Adjusted operating margin declined to 3% from 5.3% last year; restaurant-level margins down to 12.5% from 13.8% due to labor and supply inflation.

• Labor wage inflation was 3.8% in Q3; cost of goods improved by 50 bps due to pricing and supply chain initiatives.

• Off-premises sales were 23% of U.S. total, with third-party delivery at 13%, up from 12% last year.

• Cash and cash equivalents at quarter-end were $83.6 million; total debt increased to $1.09 billion.

Outlook and guidance

• Full-year 2024 U.S. comparable sales guidance updated to -1% to -0.5% due to industry softness and hurricane impacts.

• Adjusted diluted EPS guidance revised to $1.72–$1.82, assuming no industry improvement.

• Q4 U.S. comp sales expected to be down 2% to 1% year-over-year; Q4 adjusted EPS guidance is $0.32–$0.42.

• Sale of Brazil operations expected to close by year-end 2024, with Brazil restaurants to operate as unconsolidated franchisees post-closing.

• Capital expenditures for 2024 estimated at $260–$270 million.