Bloomin' Brands to shutter 41 underperforming restaurants

Bloomin' Brands, the Tampa-based parent company of Outback and Carrabba's, says it will close 41 underperforming stores — even as the firm eyes adding another 40-45 stores in 2024.

"We periodically review our asset base and in our latest review we made the decision to close 41 underperforming locations,"  Bloomin' Brands CEO David Deno said on a Friday investor call that went over 2023 financial numbers. "The majority of these restaurants were older assets with leases from the '90s and early 2000s."

Deno says the decision considered a variety of factors, including sales, traffic and the investments that would have to be made to improve the restaurants. Bloomin' Brands did not entirely specify which stores would be closed, but it named at least two international units of Aussie Grill.

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Bloomin' Brands' largest business is Outback Steakhouse, but its bestseller of late has been Carrabba's Italian Grill. Other brands include Fleming's Prime Steakhouse and Wine Bar, Aussie Grill, and Bonefish Grill.

Traffic at stores has been an issue for Bloomin' Brands in 2023. Its 2023 results are a mixed bag of better revenues, store upgrades and slowdowns in traffic. Bloomin' Brands has been struggling with competition from LongHorn Steakhouse and Texas Roadhouse, according to Raymond James Financial.

The decrease in traffic got Bloomin' Brands stock downgraded late last year by Raymond James, from the top score of "Strong Buy" to second place: "Outperform." (The next two ratings are "Market Perform" and "Underperform.")

The traffic slowdown has brought the attention of Starboard Value, a major Bloomin' Brands stockholder known for its aggressive "activist investing," especially in restaurants.

In other news, Bloomin' Brands told the SEC that Christopher Meyer will retire as Bloomin' CFO in 2024, but will remain on as the company seeks a successor. Meyer took the CFO role in early 2019.