Ruby Tuesday Inc. Announces Strategic Plan for Lime Fresh Mexican Grill Brand
November 05 2015 - 4:15PM
Business Wire
Enters Agreement to Sell Eight Corporate-owned
Locations; Will Close 11 Remaining Corporate-owned Restaurants and
Focus on Brand Franchising
Ruby Tuesday, Inc. (NYSE: RT) today announced that it has
entered into an agreement with Rubio’s Restaurants, Inc. to sell
eight corporate-owned Lime Fresh Mexican Grill locations in Florida
for approximately $6.3 million. In addition, the Company will close
its 11 remaining corporate-owned Lime Fresh Mexican Grill
restaurants immediately and maintain its eight franchised
locations. All 19 corporate-owned restaurants are leased
locations.
The completion of the transaction is targeted for January of
2016 subject to customary closing conditions. Ruby Tuesday will
operate the eight locations being sold as Lime Fresh Mexican Grills
until the transaction closes, enabling a smooth transition and
opportunities for its employees. The Company will provide
additional information when it releases second fiscal quarter 2016
earnings on January 7, 2016.
Ruby Tuesday acquired Lime Fresh Mexican Grill in April of 2012.
The purchase agreement included the brand’s intellectual property
rights and the assets of seven company-owned restaurants as well as
the royalties from five franchised restaurants.
JJ Buettgen, Chairman of the Board, President, and CEO,
commented, “As we consider Ruby Tuesday’s future, we believe it is
in our shareholders’ best interest that we exclusively operate our
namesake brand restaurants. We are therefore selling eight
corporate-operated Lime Fresh restaurants to Rubio’s Restaurants,
Inc. and closing the 11 remaining corporate-owned locations. We
sincerely thank our Lime Fresh employees for their hard work and
commitment as we work through this transition.”
Buettgen added, “We value our relationships with our Lime Fresh
franchisees and while we are maintaining our franchise model, we
will continue to evaluate strategic alternatives for the brand. Our
eight franchise locations will remain open, providing the same
great Lime food and service to all of our Lime Lovers.”
Buettgen concluded, “We are highly engaged and continue to make
progress on our transformational initiatives for Ruby Tuesday. Our
primary objective remains to drive profitable and sustainable
same-restaurant sales and traffic growth through our four key brand
pillars: menu, service, communication and atmosphere. We are
confident in our long-term strategies and believe we have laid the
foundation to deliver improved operational results over time.”
About Ruby Tuesday, Inc.
Ruby Tuesday, Inc. owns and franchises Ruby Tuesday and Lime
Fresh brand restaurants. As of September 1, 2015, there were 734
Ruby Tuesday restaurants in 44 states, 12 countries, and Guam, and
there were 27 Lime Fresh restaurants in six states and the District
of Columbia. Of those restaurants, we owned and operated 656 Ruby
Tuesday restaurants and franchised 78 Ruby Tuesday restaurants,
comprised of 28 domestic and 50 international restaurants. We also
owned and operated 19 Lime Fresh restaurants and franchised eight
Lime Fresh domestic restaurants. Our Company-owned and operated
restaurants are concentrated primarily in the Southeast, Northeast,
Mid-Atlantic, and Midwest of the United States, which we consider
to be our core markets. For more information about Ruby Tuesday,
please visit www.rubytuesday.com.
Ruby Tuesday, Inc. is traded on the New York Stock Exchange
(Symbol: RT).
Forward-looking Information
This press release contains various forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. Forward-looking statements represent our expectations or
beliefs concerning future events, including one or more of the
following: future financial performance (including our estimates of
growth in same-restaurant sales, average unit volumes, operating
margins, expenses, and other items), future capital expenditures,
the effect of strategic initiatives (including statements relating
to cost savings initiatives and the benefits of our marketing), the
opening or closing of restaurants by us or our franchisees, sales
of our real estate or purchases of new real estate, future
borrowings and repayments of debt, availability of financing on
terms attractive to the Company, compliance with financial
covenants in our debt instruments, payment of dividends, stock and
bond repurchases, restaurant acquisitions, and changes in senior
management and in the Board of Directors. We caution the reader
that a number of important factors and uncertainties could,
individually or in the aggregate, cause our actual results to
differ materially from those included in the forward-looking
statements, including, without limitation, the risks and
uncertainties described in the Risk Factors included in Part I,
Item A of our Annual Report on Form 10-K for the year ended June 2,
2015.
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version on businesswire.com: http://www.businesswire.com/news/home/20151105006775/en/
Investor Relations:Melissa
Calandruccio646-277-1273melissa.calandruccio@icrinc.com
Media Relations:Liz
DiTrapano646-277-1226Liz.ditrapano@icrinc.com
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