With a little more time to comb through LRI Holdings' IPO filing comes a little more perspective on where the Logan's Roadhouse parent is coming from and where it's going. Here are some of the details:
• Cost controls: The company has been busily tightening its belt. While sales are on track to rise 3.6 percent to more than $550 million this fiscal year, labor costs — which make up more than a third of total restaurant expenses — are up just 2.5 percent and general and administrative spending is down almost 9 percent from a year ago.
• Store growth: "We plan to open 15 company-owned restaurants during fiscal year 2011 and believe we can achieve a long-term annual company-owned restaurant growth rate of approximately 10%." A 6,500-square-foot, $3.1 million store design used in the last 20 openings has produced good results.
• Selling booze: The recession appears to have led many a diner to sacrifice the margarita for a coke as alcohol sales fell to 7.4 percent of 2009 sales from a historical average closer to 9 percent. The upside: A chance to juice sales as the economy rebounds.
• Same-store sales: After a year and a half of falling same-store numbers — with the trough being a 5.9 percent drop in the spring of 2009 — sales turned positive in the recently concluded fiscal third quarter. (Search for '14 weeks.')
• An interesting fact about LRI's senior management: Not a single one is older than 50. They also did not get raises this past fiscal year.
KKR, founded in 1976 by Kravis and Roberts, is resuming deal-making after an almost three-year drought triggered by the global credit crisis following a record LBO boom. In addition to new investments, the firm is seeking to reap profits from holdings through public share sales for companies including hospital chain HCA Inc. “We’re not in the environment we were in a few years ago, but we’ve certainly turned the corner for performance and demand for private equity,” Michael Kim, an analyst with Sandler O’Neill & Partners LP in New York, said in a telephone interview.