Ruth’s Hospitality Provides Update on COVID-19


Ruth’s Hospitality Group, Inc. announced steps that the Company has taken to implement conservative cash management strategies designed to increase available liquidity and maximize financial flexibility until the COVID-19 pandemic abates and market conditions stabilize.

“The safety and well-being of our team members and guests is our priority in these challenging times. Our brand has a rich history of rising to the occasion and I am proud of our team’s response to this unprecedented situation,” said Cheryl Henry, President and Chief Executive Officer of Ruth’s Hospitality Group, Inc. “Our management team and Board of Directors have taken significant measures to enhance our financial flexibility during this time which includes drawing down and expanding our credit facility, suspending our dividend, and materially reducing capital expenditures as we weather the challenges related to COVID-19.”

Borrowings Under Senior Credit Facility

As previously announced, on March 16th, 2020, the Company increased its cash position by drawing down its remaining availability under its $120 million revolving credit facility.

Additionally, on March 26, 2020, the Company exercised the $30.0 million accordion feature in the existing facility and, as a precautionary measure, drew down that balance. As of March 27, 2020, the Company had approximately $71.5 million of cash on hand.

Actions Taken To Improve Liquidity

Additional measures to enhance the Company’s financial flexibility include suspending all new restaurant construction and non-essential capital expenditures which are expected to lower annual capital expenditures by over $35 million. The Company has also suspended its quarterly dividend. Ruth’s Chris has also made significant reductions in ongoing operating expenses, including curtailing operations in 23 restaurants locations where take-out and delivery is not viable, furloughing a significant number of field and home office team members, reducing base salaries of all non-furloughed team members and reevaluating other operating costs as opportunities arise. Certain operational team members have been re-deployed to support the take-out and delivery operations of restaurants which are still operating.

Lastly, Ms. Henry and the other members of the executive team have elected to reduce their 2020 base salaries effective March 30, 2020. Non-employee directors of the Company have also elected to suspend payment of their annual cash retainer fees for service on the board.

Ruth’s Anywhere

Due to the state mandates regarding limited or no in-restaurant dining due to COVID-19, the Company is leveraging its Ruth’s Anywhere program in markets where take-out and delivery sales are sufficient to cover the costs of management staffing those locations. At this time, Ruth’s Chris is currently operating many of its domestic restaurants in take-out or delivery mode, with no dining rooms currently open for operation. Delivery is available in all of those locations via third-party delivery networks and those partners vary by location. The Ruth’s Anywhere Program will offer a streamlined menu available on its website here, featuring many guest favorites.

Financial Guidance

Lastly, due to the ongoing uncertainty around the duration and severity of the COVID-19 pandemic, the company has withdrawn its financial guidance for fiscal year 2020.

Further details regarding the credit agreement and financial actions described in this release may be found in the Company’s Current Report on Form 8-K filed today. The Company currently expects to provide additional updates on the business when it announces its first quarter 2020 financial results.