Shares of Red Robin Gourmet Burgers tank after disappointing 2Q preliminary earnings report

Shares in Red Robin Gourmet Burgers Inc. (NASDAQ:RRGB) tumbled Thursday in premarket trade after the casual-dining chain gave a weak preliminary second-quarter report

The Colorado-based burger chain said it expects same-store sales to fall 2.6% in the quarter and guest traffic to decrease by 0.07%.

Add to that an expected loss of US$0.14, driven by a US$0.54 asset impairment charge, and adjusted earnings of US$0.46, with revenue expected to total $315.4 million versus consensus estimates for earnings of US$0.65 on revenue of US$323.6mln, and investors flew from Red Robin shares.

Red Robin stock plunged about 22% to US$35.85 in before the bell.

“We are disappointed with our performance in the second quarter. While we remain confident in the strategy that we have in place to address the shifts going on within casual dining, we simply didn’t execute as well as we should have,” Red Robbin CEO Denny Marie Post said in a statement.

For the full year, the company expects total revenues to range between US$1.35bn and US$1.36bn, including a comparable restaurant revenue decrease of 1% to 2% and earnings per diluted share to range from US$1.80 to US$2.20.

Red Robin will announce its second-quarter results after hours on August 21.

–Adds same-store sales, updates share price–

Contact Uttara Choudhury at [email protected]

Follow her on Twitter: @UttaraProactive 

Story by ProactiveInvestors