Del Frisco’s Grille

Making Bank

Restaurants on the rise are touting double-digit growth in revenues.

It’s not enough to make great food and beverages; restaurant chains worth noting are those that make great financial strides as well. The brands on the FSR list of Ones to Watch have impressive track records, starting with the fact that each recorded 2013 year-over-year sales gains of 13 percent or greater.

Compare that with the companies in the FSR 50, where 21 chains experienced sales growth of less than 5 percent in 2013 and 15 brands actually saw revenues decline from 2012 to 2013. In fact, only one restaurant among the FSR 50 experienced sales increases greater than 13 percent: Buffalo Wild Wings, at 23.3 percent, which also celebrated crossing the $1 billion mark in 2013. While none of the companies on the Ones to Watch list is close to that billion-dollar threshold, it’s significant when a company tallies an 83 percent leap in revenues, as was the case with Del Frisco’s Grille, or when Twin Peaks increases its sales by 68 percent and scales past $165 million in revenues.

Among the 10 brands profiled as Ones to Watch, five are upscale eateries, including three with a dominant steakhouse profile; three brands veer to the pub or sports bar genre; and the remaining two are classic casual- or family-dining venues. Each is a success story in the making.

Del Frisco’s Grille

Sales Growth: 83.8 percent 2013 Sales: $44 Million

The Del Frisco’s Restaurant Group (DFRG) says its Grille concept is the company’s upscale-casual answer to demand for more Del Frisco units—a strategic gamble that is clearly paying off in spades. The brand more than doubled in size in 2013, growing from five to 11 units, with average unit volumes (AUV) running between $4.5 million and $6 million, and average check amounts of $45–$55. The Grille locations range in size from 6,500 to 8,500 square feet, and offer both an ambiance and menu that cater to business diners and customers looking for Del Frisco’s signature steaks in a less-formal setting. DFRG’s other brands, Double Eagle Steak House and Sullivan’s Steakhouse, have larger footprints and higher price points, with average checks ringing in at $107 and $59, respectively. The company plans to open additional units of each brand, aiming for perhaps one new Double Eagle Steak House a year and four to six units between Sullivan’s and the Grille. However, the Grille is expected to be the leading growth vehicle, and another Grille opened in June in Burlington, Massachusetts, bringing the brand’s total to 12 units.


Twin Peaks

Sales Growth: 68.4 percent 2013 Sales: $165 Million

The parent company of Twin Peaks, Front Burner Restaurants of Addison, Texas (not to be confused with Front Burner Brands of Tampa, Florida), is rocking the sex-appeal-themed sports bar segment with AUVs that leave competitor brands Hooters and Tilted Kilt in the dust. Twin Peaks lays claim to an AUV of $4.2 million versus the $2.3 million AUV boasted by both Hooters and Tilted Kilt. And those were 2013 numbers; this year the story may be about margins as well as sales, as Twin Peaks announced in April the opening of its Twin Peaks Brewing company.

Opened in conjunction with its Irving, Texas, restaurant, the new brewery will create the company’s signature draft beers for the brand’s units in the Dallas-Fort Worth area. In announcing the brewery, Twin Peaks CEO Randy DeWitt also introduced Twin Peaks brewmaster Tom Janik, who will make all beers from scratch using the company’s own recipes. Additionally, Twin Peaks has opened seven locations thus far in 2014, including its second unit in Las Vegas, and has plans to open a total of 14 locations this year.

Cooper’s Hawk Winery & Restaurants

Sales Growth: 30.6 percent 2013 Sales: $94 Million

It’s been a vintage year for Cooper’s Hawk, and momentum is not slowing a bit as Cooper’s Hawk tells FSR it plans to generate annual sales growth in excess of 25 percent this year and beyond. The brand, which launched in 2005, pairs signature dishes with the private-label wines from its Cooper’s Hawk winery. With an AUV of $8.5 million, the winery and restaurant combo is clearly a winning business model. Next month, the brand will open a second restaurant in Orlando, its third in the Sunshine state, followed by new units slated to open in Richmond, Virginia, and Springfield, Illinois, before year-end. Next year, Cooper’s Hawk will open in Oak Lawn, Illinois, making a total of eight units in its home state. The company also announced it will open its first Washington-area restaurant in the Ashburn community of Loudoun County, Virginia, before the end of 2015—marking its second location in that state.

Jimmy Buffett’s Margaritaville

Sales Growth: 27.3 percent 2013 Sales: $154 Million

Changes in latitudes, changes in attitudes—all par for the course at Jimmy Buffett’s Margaritaville, which was purchased earlier this year by the International Meal Company (IMC) as the São Paulo–based owner of quick-casual concepts in Brazil and Latin America made its entrance into the U.S. full-service restaurant market. However, the Jimmy Buffet’s Margaritaville organization will continue to be involved in restaurant operations, branding, and development. IMC also owns Margaritaville locations at airports in Puerto Rico and Panama, and now owns the exclusive development rights for the brand in the U.S. and Latin America. The new partnership should bode well for the brand, bolstered by the international presence and deep pockets of IMC along with the creativity and name recognition of Jimmy Buffett’s Margaritaville, which recently launched a line of women’s apparel. Continuing its expansion in dominant tourist destinations, Margaritaville opened in Pigeon Forge, Tennessee, in June.


Seasons 52

Sales Growth: 24.3 percent 2013 Sales: $196 Million

To everything there is a season, and fresh grill and wine bar concept Seasons 52 delivers on so many consumer-preference trends it’s hard to imagine this brand will do anything but flourish. The name embodies the business model: Serve the season’s best ingredients, 52 weeks of the year. Do so in an upscale setting, with an engaging piano bar, menu selections that suggest the culinary insights of a chef-owned operation, and an expansive wine list—some 100 choices, including 60 selections available by the glass and a nice assortment of organic wines as well. And for the health-conscious consumer, nothing on the menu has more than 475 calories. With an average check amount around $41, this could be Darden’s golden-child concept, although same-store sales dipped 2.2 percent in the fiscal year that ended in May, and AUV rang in at $5.7 million versus $6.2 million the year prior. The company is in strategic growth mode, opening in prominent shopping destinations including Lone Tree, Colorado’s high-end Park Meadows Mall, this summer, and later this year in malls in Columbia, Maryland, and Sarasota, Florida.

Black Bear Diner

Sales Growth: 24.3 percent 2013 Sales: $148 Million

What positions Black Bear Diner so well in the industry is that it defies traditional segmentation. Technically classified with the family-dining chains, its leaders suggest, Black Bear is actually a “polished” or “upscale” family-dining venue. Unlike Denny’s, IHOP, and others firmly planted in the world of family dining in which breakfast and lunch dayparts rule, Black Bear has equal visits across all dayparts, with the evening meal running on par or ahead of lunch and breakfast. The average check of $13 also reflects the vitality of Black Bear’s dinner business. Comp sales at established units continue trending upward, and while the AUV for the company hovers around $2.3 million to $2.4 million, Black Bear Diner’s vice president of franchise development and operations Doug Branigan says, “The last 10 units that opened have an AUV of $2.7 million.” In June, there were 63 locations—five company-owned, 13 licensed operations, and 45 franchise units. Black Bear will add six to eight units this year and another eight to 10 units in 2015. The company remains primarily focused in the western U.S., although expansion east is not out of the question. “We’ll continue to grow in California, Oregon, and Washington, and we’d love to grow in Colorado and Idaho as well,” says Branigan. “It’s exciting because we are growing with current franchisees as well as with new developers.”

Firebirds Wood Fired Grill

Firebirds Wood Fired Grill

Sales Growth: 19.2 percent 2013 Sales: $94 Million

The upscale-casual dining segment is blazing forward thanks to concepts like Firebirds Wood Fired Grill, where revenue growth is expected to hit 27 percent this year and sales are on track to reach $120 million. Seven locations are opening in 2014, including units in Florida, Ohio, Tennessee, and Virginia, with another eight slated for 2015. “We’re looking at sites further into Florida (past the Winter Park location that opened last month), as well as in Georgia, and backfill opportunities in Maryland and Virginia,” says Stephen Loftis, Firebirds vice president of marketing. All locations are company-owned, although Loftis explains that general managers are sometimes promoted to managing partner, which gives them an ownership stake in the unit they are running. The brand’s biggest differentiator is cooking on the wood-fired grill—a technique localized by the sourcing of wood from within the state where each restaurant resides. “Out West, the restaurants are using pecan wood, but in North Carolina it’s more often pine or oak,” Loftis says. “Cooking on the wood-fired grill really locks in the flavors.” Although the wood-fired meats and fish are huge draws, Lobster Spinach Queso is the No. 1–selling item, and Loftis says subtle details that diners are accustomed to in fine-dining establishments set Firebirds apart. Chilled plates and forks for salads, warm towels to accompany messy ribs, and long-handled dessert forks to accommodate sharing the signature Creme Brulée Cheesecake—these are the touches that make Firebirds $24 average check resonate with value.



Sales Growth: 18.4 percent 2013 Sales: $204 Million

Made-from-scratch Tex-Mex cuisine is clearly a hit at Chuy’s, which delivers a consistent menu experience in settings that are decidedly eclectic and, contrary to most casual-dining chains, not formulaic. The business model has been working for years, as witnessed by the 2013 performance metrics, and there’s no slowing in 2014: First-quarter revenues were up 19.8 percent over the same period a year ago, and same-store sales rose 4.8 percent, due in part to the company’s addition of 12 units since the first quarter of 2013. The company plans to open 10 or 11 units this year.

Del Frisco’s Double Eagle Steak House

Sales Growth: 16 percent 2013 Sales: $145 Million

Now is the time to do a double-take over Del Frisco’s Double Eagle Steak House, which has an amazing AUV of $14.3 million and scored double-digit sales growth—a healthy 16 percent increase—while its unit count remained unchanged. That’s unprecedented performance, both from the Ones to Watch and the FSR 50 lists, where every other company that achieved high-performing sales growth did so with a measurable increase in units, as well. The 10 Double Eagle Steak House locations are spread across eight states, and range in size from 11,000 to 24,000 square feet. Each can seat at least 300 diners, and in 2013 the average check was $107.

Bar Louie

The Cheesecake Factory
Bar Louie

Sales Growth: 13 percent 2013 Sales: $131 Million

Earlier this year, Bar Louie CEO John Neitzel told FSR his chain would add 200 units by 2018, including 25 locations to open in 2014. It’s a race to become the neighborhood hot spot for the young, hip, and comfortably affluent, as most Bar Louie guests are between the ages of 25 and 44, with incomes greater than $75,000. These are loyal folks who like to party: Eighty-one percent visit more than once a month, and spirits count for a whopping 50 percent of Bar Louie sales. The beverage menu touts more than a dozen martinis, 17 signature cocktails, assorted beers, and more than 20 wines by the glass. Bar Louie plans to open company-owned units in the Mid-Atlantic, Northeast, and Texas, while franchise expansion is focused on the West Coast and Southeast.

Chains2013 U.S. Sales ($000)2012 U.S. Sales ($000)% Change2013 U.S. Units2012 U.S. Units% Change2013 AUV ($000)
Del Frisco’s Grille44,10024,00083.81151205,500
Twin Peaks165,32598,16468.4452864.34,200
Cooper’s Hawk Winery & Restaurants94,40072,30030.6141127.38,500
Jimmy Buffett’s Margaritaville154,000121,00027.3161233.39,600
Seasons 52196,000158,00024.3383122.55,700
Black Bear Diner148,483119,46424.36154132,420
Firebirds Wood Fired Grill94,50079,30019.2292326.13,800
Del Frisco’s Double Eagle Steak House144,600124,700161010014,300
Bar Louie131,427116,20613.1806817.62,406
Sources: SEC filings, company reports, Technomic reports and estimates, FSR research.