Steak n Shake grew pretax profit in fiscal 2010 an impressive 331 percent, the owner of the Indianapolis-based restaurant chain said in a letter to shareholders over the weekend.
San Antonio-based Biglari Holdings Inc., which changed its name from Steak n Shake Co. in April, said the restaurant reported $37.7 million in pretax profit during the latest fiscal year, a huge increase from the $8.7 million it had in fiscal 2009.
Biglari Chairman Sardar Biglari said in the letter that Steak n Shake went from losing $100,000 a day at the beginning of last year to making $100,000 a day this year.
“Steak n Shake was a troubled company whose brand required repositioning, a task made even more enervating because it had to be undertaken in the midst of the ‘Great Recession,’” Biglari wrote. “After we removed the near-lethal cancer of bad strategy, the turnaround was quickly successful because of the fortitude, tenacity and commitment of all 20,000 associates who put their collective shoulders to the wheel executing the plan.”
Same-store sales increased 6.8 percent in the fiscal fourth quarter ended Sept. 30, marking the seventh consecutive quarter of growth.
Overall, Biglari Holdings in fiscal 2010 posted $28 million in profit on revenue of $622.9 million, largely due to Steak n Shake’s increase in same-store sales, Biglari said in its annual report filed on Monday.
Still, Biglari cautioned investors that the company expects “difficulties” in fiscal 2011 exceeding prior-year profits because of expected investments in human resources, training and franchising.
Steak n Shake operates 483 company-owned and franchised Steak n Shake restaurants.
Company shares rose to $433.11 each in late-morning trading, up 2.2 percent from their Monday opening price.