P.F. Chang's Slows Down New Openings

SCOTTSDALE, AZ-With comp-store sales and profits declining, P.F. Chang’s China Bistro is reducing its planned openings for 2009 to focus on improving its existing units, executives said at the company’s fourth quarter conference call.

The company currently expects to open four to six new Bistro restaurants and two to four new Pei Wei restaurants during fiscal 2009. Last year, the company opened 17 Bistros and no Pei Wei units, while closing 10 of the latter. No store closures are planned for either Bistros or Pei Wei. <p."Because there are limited opportunities, maybe 10 to 20 units per year, so we can be very selective about where we choose to go," said Richard Federico, chairman and co-CEO. "There are fewer and fewer developments getting financed, and fewer lifestyle retailers getting developed."

The result, he said, is that unit growth will be on the low end for 2009 and into 2010. The company also is working on renegotiating terms with developers.

[Landlords] are in a bit of a pickle themselves these days,” said Robert Vivian, co-CEO. “We’re both trying to work our way through this morass. Obviously we would like to pay less; they would like for us to pay more.”

For the quarter, consolidated revenues were $294.8 million, compared to $289.4 million for the fourth quarter of 2007. Comparable store sales decreased 7.1% at the Bistro, and 6.1% at Pei Wei. Net income was $5.4 million, compared to $7 million for the fourth quarter of the prior year.

For the year, the company reported sales of $1.2 billion, up from $1.1 billion last year. Comparable store sales declined 3.7%. Net income was $27.4 million, down from $32.1 million last year.

P.F. Chang’s owns and operates 189 P.F. Chang’s China Bistro and 159 Pei Wei Asian Diners.