Luby’s Credits Love for Sales Gains

DALLAS Luby’s same-unit sales have grown for the last three quarters thanks in large part to the cafeteria chain’s ad campaign, said president and CEO Chris Pappas.

Using the tagline “Tastes like Texas, feels like home,” the campaign was created by independent agency Love Advertising in Houston, a company rep said. (The client uses “This is why I love Luby’s” as a secondary tag, the rep said.) Luby’s will operate under the same advertising theme next year, Pappas said.

Key personnel on the account at Love are president Brenda Love, vice president and creative director Billie Van Slyke and account executive Natalie Franks, the agency said.

Luby’s same-unit sales increased 3.8 percent to $96 million for the fourth quarter of its fiscal year ended Sept. 30, the company said.

Luby’s profit rose to $2.7 million, or 12 cents a share for the fourth quarter, compared with a loss of $1.6 million, or 7 cents a share, for the same period last year, the company said. For the year, Luby’s had a loss of $6.4 million compared to a loss of $33.1 million from a year ago.

The San Antonio-based cafeteria chain is completing a move to new headquarters in Houston in December, Pappas said.

“Houston is Luby’s largest market with 40 restaurants and is home to our centralized facilities service center,” Pappas said. “In addition, many of our key management personnel live in Houston. Bringing everyone together into one city will provide increased efficiency and productivity.”

About 80 jobs are shifting from San Antonio to Houston. Luby’s operates 15 restaurants in San Antonio, employing more than 800 people.

After defaulting on its debt last year, the chain has restructured its finances under a new package of loans.

On March 31, 2003, the company launched a two-year business plan that led to the closing of 50 restaurants, leaving 140, mostly in Texas. Before that, Luby’s had operated in 10 states.

“We’ve refinanced our bank debt. We’ve improved our offerings in the restaurants and launched a major marketing campaign, resulting in increases in same-store sales,” Pappas said. “And we’ve continued our efforts to implement initiatives at the restaurant level that strengthen operations, improving the experience for our customers every time they walk in the door.”