Restaurant Industry Outlook Remained Positive in April
Jun 1, 2010
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The outlook for the restaurant industry – including capital expenditure plans - remained positive in April with the National Restaurant Association index of restaurant activity standing above 100 for the second consecutive month.

The association’s Restaurant Performance Index (RPI) – a monthly composite index that tracks the health of and outlook for the U.S. restaurant industry – was essentially unchanged from its previous month’s level; the RPI stood at 100.4 in April, down slightly from its March level of 100.5. RPI levels above 100 indicate expansion of key industry indicators.

“Although the sales and traffic indicators softened somewhat from their March performance, restaurant operators remain optimistic that business conditions will improve in the months ahead,” said Hudson Riehle, senior vice president of the Research and Knowledge Group for the Association. “In addition, restaurant operators reported a positive outlook for staffing gains, as well as continued plans for capital expenditures in the coming months."

Although sales and traffic results softened in April, restaurant operators reported a moderate uptick in capital spending. 40% of operators said they made a capital expenditure for equipment, expansion, or remodeling during the past three months, up from 36% last month and the highest level in six months.

The Expectations Index, which measures restaurant operators’ six-month outlook for four industry indicators (same-store sales, employees, capital expenditures, and business conditions), stood at 101.8 in April – down slightly from a level of 101.9 in March. Despite the modest decline, the Expectations Index stood above the 100 level for the fourth consecutive month, which signifies expansion in the forward-looking indicators.

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