Brinker Ups Franchise Stake

But don't expect the company to switch all of its ownership rights anytime soon. "We still make more money by operating these restaurants as company-owned," said Douglas Brooks, Brinker's president and chief operating officer, during its first-quarter conference call. "It's possible that over the longer term we could have a system that's somewhat different."

Brinker opened 43 units during the quarter, which ended Sept. 27. Ten were opened by franchisees and 33 are company owned. The majority of the new domestic restaurants, 35, are Chili's, which boosted its presence in Florida and Texas. Management plans to open the same amount of stores during the current quarter.

Brinker is opening Chili's in a variety of different formats, from stand-alone units to locations in non-traditional venues such as airports. "This brand can be scaled up or down to meet customers in a number of different ways and different places," Brooks says.

As well as the new Chili's locations, Brinker opened two Macaroni Grills, two On the Borders and four international units. The company currently operates a total of 128 units abroad, recently entered Peru, and has plans to open stores in Ecuador and Canada this quarter.

While the company is expanding, same-store sales at all of its chains fell 2.1% during the quarter year over year. At its just more than 1,100-unit Chili's operation they slid 2.3%, the 234 Macaroni Grills were down 1.7%, the 38 Maggiano's dropped 2.2% and the 128 On the Border locations fell 1.5%.

Despite the comparable-sales drop, Brinker's income rose 29%, to $47.6 million. The company's total sales came in at just more than $1 billion, a 6.6% climb.