U.S. Markets close in 21 mins.

Luby's 3Q profit up as revenue rises

HOUSTON (AP) -- Luby's Inc. fiscal third-quarter profit increased 43 percent on higher sales.

The company reported Wednesday that it earned $2.4 million, or 9 cents per share, for the quarter that ended May 9. That compares with $1.7 million, or 7 cents per share last year.

Revenue rose to $84.1 million from $83.4 million.

The company, based in Houston, owns the Luby's Cafeteria, Fuddruckers, Koo Koo Roo Chicken Bistro's and Bob Luby's seafood Grill brands. It also runs a food service management business.

Restaurant sales fell to $77.9 million from $78 million last year as it opened four new stores but had five fewer in total than last year.

Revenue from stores open at least a year and a half rose 1.1 percent. This is considered a key measure of a retailer's financial performance as it strips away the impact of recently opened or closed stores.

Luby's CEO Chris Pappas said that the company was able to improve its operating margins by focusing on improvements in every aspect of its operations, from inventory management to staff scheduling. The company had lower food costs and other operating expenses during the period.

"We have been able to bring down costs while raising our level of customer service," Pappas said.

The company expects revenue from stores open at least a year and a half to grow between 1.5 and 2.0 percent for the full fiscal year compared to the prior year. It expects to earn 18 to 21 cents per share from continuing operations and anticipates total restaurant sales of $321 million to $324 million for the year, up from $319 million in fiscal 2011 on an adjusted basis.

Luby's shares fell 14 cents to close at $5.73.