The thing I love about covering public companies is the easy access to financials and other information that privately held firms like to keep, well, private.
Public companies, though, don’t have that luxury, and sometimes that gives you a chance to better understand and appreciate their operations.
Take restaurants, for instance, in the age of COVID-19.
When concern over the novel coronavirus began to build in March, eateries faced the prospect of government-ordered reductions in dining room capacity to slow the rate of infection until all were finally told to close – save for takeout and delivery.
For U.S. restaurants, the mandate cost $80 billion in sales from March to April, according to the National Restaurant Association, with 8 million workers furloughed or laid off. For New York, the loss was $5.5 billion in sales and 527,000 workers.
At the publicly traded chain restaurants, the damage showed up in the quarterly numbers they had to report just as the pandemic descended.
Applebee’s, the casual-dining eatery, saw 10 consecutive weeks of positive first-quarter “comp sales” wiped out. By the last week of March, the numbers – a measure of retail health based on sales at locations open at least a year – were down 80.6 percent.
Other chains saw it, too: Denny’s comp sales were off 79 percent; Olive Garden’s dropped nearly 65 percent; LongHorn Steakhouse’s fell 75 percent.
The carnage would have been even worse had they all not been able to continue selling through takeout and delivery.
At Applebee’s, which already had takeout through Carside To Go, so-called off-premises sales tripled between the beginning of the year and the end of April, running then at $17,700 per restaurant per week.
That wasn’t close to meeting the average restaurant’s annual sales of $2.4 million, though. On the first-quarter conference call of parent company Dine Brands Global in late April, Applebee’s President John Cywinski said the company-owned and franchised restaurants generally were doing only 35 percent of last year’s volume.
But comp sales were improving weekly, even with takeout’s limited menu, he said, and he predicted the off-premises business “will remain robust” as Applebee’s dining rooms begin to reopen. (Some states allowed in-restaurant dining to resume in late April; in New York, it’s slated to occur in Phase 3 of the state’s gradual reopening, which should reach the Capital Region later this month.)
On the quarterly conference call, Dine Brands CEO Steve Joyce suggested a new inverse relationship between dining in and taking out: Sales from the former now will be an incremental add-on to the latter that will slowly help restaurant profitability.
And how will the reopened restaurants look? Expect gloves and masks, no table condiments, frequent sanitizing and social distancing, he said.
“What we don’t know … is how many people are interested in coming into restaurants at this point, and what’s that number [going to] look like,” Joyce said.
Marlene Kennedy is a freelance columnist. Opinions expressed in her column are her own and not necessarily the newspaper’s. Reach her at [email protected].