Texas Roadhouse is a casual dining concept that first opened in 1993 and today operates over 220 restaurants system-wide in 41 states.

- Comparable restaurant sales increased 3.6% at company restaurants and 1.6% at franchise restaurants. Excluding restaurant closures related to hurricanes Katrina and Rita, comparable restaurant sales increased approximately 4.0% at company restaurants;
- Restaurant operating costs, as a percentage of sales, were 10 basis points lower than the fourth quarter of 2004. Lower rent expense, due primarily to lapping the prior year's straight line cumulative rent adjustment, and insurance costs were partially offset by higher utilities, credit card fees, food costs, and hurricane-related closure costs;
- Pre-opening expenses increased $0.5 million or 27.2% quarter-over-quarter reflecting slightly higher costs for openings in 2005 versus 2004; and
- Income from operations grew 19% versus the fourth quarter of 2004 driven principally by the addition of new restaurants.

G.J. Hart, President and Chief Executive Officer of Texas Roadhouse commented, "During the fourth quarter, we were pleased to regain the sales momentum that was temporarily lost after the hurricanes last September. Driving our comparable store gains throughout the quarter was a consistent increase in traffic complimented by a slight increase in pricing. Our pricing benefit was 2% in October but zero in November and December." Hart continued, "Positive trends have continued during the first seven weeks of 2006, as comparable restaurant sales have increased approximately 6% which includes only 1% of pricing. On the expense side, inflation in utilities is having the most notable impact on costs although we are confident in our profitability outlook. Adding to that confidence is our 2006 development plan, which we believe is on track, positioning Texas Roadhouse and our shareholders for continued, long term gains."

Outlook for 2006
The Company currently estimates that it will generate diluted earnings per share of at least $0.52 for 2006 excluding the impact of franchise acquisitions and stock option expense, which are discussed below. This forecast is unchanged from the Company's third quarter 2005 release and is based on the following assumptions:

-- New restaurant openings of 23 to 24 company-owned and three to four franchised;

-- Comparable restaurant sales growth of approximately 3%;

-- Restaurant operating costs as a percent of sales decrease of approximately 50 basis points;

-- Effective tax rate of 35.3%; and

-- Weighted average diluted shares of approximately 75.5 million.


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