The National Restaurant Association (NRA) reports today that:
Driven by higher same-store sales and an improving outlook among restaurant operators, the National Restaurant Association's Restaurant Performance Index (RPI) hit a 10-month high in April (see red line in chart). The RPI -- a monthly composite index that tracks the health of and outlook for the U.S. restaurant industry -- stood at 101.0 in April, up 0.4 percent from a level of 100.6 in March. In addition, April represented the third time in the last four months that the RPI topped the 100 level, which signifies expansion in the index of key industry indicators.
'Growth in the Restaurant Performance Index was due largely to restaurant operators' healthier outlook for the business environment in the coming months,' said Hudson Riehle, senior vice president of the Research and Knowledge Group for the Association. 'In particular, there was a dropoff in the proportion of operators who expect conditions to worsen in the months ahead, which suggests a broadening of the perspective that the expansion is firmly entrenched.'
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 101.9 in April -- up 0.5 percent from March and the highest level in 11 months (see blue line in chart).
Further evidence of an improving outlook for U.S. restaurants is provided by census data showing that sales for "Food Services and Drinking Places" were up by 3.2% in April from a year earlier, following a 3.7% increase in March. After being flat in 2008 and 2009, sales at "food services and drinking places" are now almost 20% above the June 2009 level when the recession officially ended, and sales set a new monthly record high (in both nominal and real dollars) of almost $46 billion in April.
Moreover, sales at "Full Service Restaurants" set a new monthly record high (in both real and nominal dollars) of $21.1 billion in March (most recent month available), and were up by 3.7% year over year. The relevant sales data suggest that the restaurant industry has made a full recovery from the recession and is now operating back above pre-recession levels for inflation-adjusted sales. And with the NRA's Expectations Index rising to an 11-month high in April, we can expect further gains in restaurant sales and performance in the months ahead.