Texas Roadhouse (TXRH) 8-K Texas Roadhouse, Inc. Announces Third Quarter 2007 Results

Exhibit 99.1

Texas Roadhouse, Inc. Announces Third Quarter 2007 Results

LOUISVILLE, Ky (October 29, 2007) — Texas Roadhouse, Inc. (NasdaqGS: TXRH), today announced financial results for the 13 and 39 week periods ended September 25, 2007.

	Third Quarter					Year to Date
($000’s)	2007		2006		% Change	2007		2006		% Change
Total revenue	189,454		148,454		28	548,777		444,573		23
Income from operations	17,193		14,241		21	51,795		42,619		22
Net income	10,552		9,150		15	32,105		26,163		23
Diluted EPS	$	0.14	$	0.12	15	$	0.42	$	0.34	22

Highlights for the quarter:

•      Comparable restaurant sales increased 2.5% at company restaurants and 2.0% at franchise restaurants;

•      Five company restaurants opened;

•      Nine restaurants were acquired from franchisees; and

•      Diluted earnings per share increased 15% to $0.14 from $0.12 in the prior year period.

Highlights year-to-date:

•      Comparable restaurant sales increased 2.0% at company restaurants and 1.5% at franchise restaurants;

•      Twenty-two company and two franchise restaurants opened;

•      Nine restaurants were acquired from franchisees; and

•      Diluted earnings per share increased 22% to $0.42 from $0.34 in the prior year period.

Reported results for the quarter also included:

•      A pre-tax credit of $0.6 million ($0.4 million after-tax) to insurance expense based on the most recent actuarial report relating to workers compensation and general liability insurance.  The third quarter of fiscal 2006 included a pre-tax credit of $1.9 million ($1.2 million after-tax) to this expense item based on the 2006 actuarial report; and

•      A pre-tax, non-cash charge of approximately $0.5 million ($0.3 million after-tax) relating to the Company’s acquisitions of nine franchise restaurants on the first day of the quarter.  There was no corresponding charge during the same quarter of the prior year; however, during the first quarter of fiscal 2006, the Company incurred a pre-tax, non-cash charge of $0.8 million in conjunction with the acquisitions of 11 franchise restaurants, which was non-deductible for tax purposes.

G.J. Hart, President and Chief Executive Officer of Texas Roadhouse, commented, “We are pleased that we are on track to deliver at least 20% diluted earnings per share growth in 2007.  And, looking to 2008, we are estimating approximately 20% diluted earnings per share growth, excluding the benefit of an extra operating week. Driving our performance is a strong development pipeline, combined with solid restaurant-level execution.  Finally, we have always stated that in challenging times, our value proposition and operational focus offers real differentiation in the marketplace and we believe that this positions us to create long term value for our stockholders.”

Franchise Acquisitions

As previously announced, on June 27, 2007, the first day of the Company’s third fiscal quarter of 2007, the Company acquired nine franchise restaurants.  The aggregate purchase price for the restaurants, which included seven in Indiana and one each in Kentucky and Missouri, was approximately $22.6 million.  In separate but related transactions the Company acquired the land and buildings associated with seven of the nine properties, which were owned by related parties of the seven franchisees, for an aggregate price of approximately $12.1 million.  The purchase price for all the transactions was paid in cash, funded through borrowings under the Company’s credit facility.  On a 12-month basis, the acquisitions are expected to add approximately $33.5 million of net revenue and approximately $0.015 per diluted share to earnings, excluding the non-cash, acquisition-related charge recorded during the third quarter of fiscal 2007, as discussed above.

Outlook for 2007

The Company reported that comparable restaurant sales for the first four weeks of the fourth quarter of fiscal 2007 increased 0.3% over the same period of the prior year.

In addition, the Company reiterates its estimate for 2007 diluted earnings per share growth of at least 20%, or at least $0.53 per diluted share.

This estimate is based on the following annual assumptions:

•        New restaurant openings of 31 to 32 company-owned and two franchised; and

•        Comparable restaurant sales growth of 1.5% to 2.0%.

The 2007 earnings estimate presented includes the non-cash charge and ongoing earnings impact related to the Company’s acquisitions of franchise restaurants discussed above, but excludes any impact from any additional potential acquisitions.

Outlook for 2008

The Company is currently estimating diluted earnings per share growth of approximately 20% for fiscal 2008.  The 2008 earnings estimate excludes the positive impact from an additional operating week associated with the fact that fiscal 2008 is a 53-week year and, as such, the fourth quarter of fiscal 2008 will contain 14 weeks versus 13 weeks in the fourth quarter of fiscal 2007.  The Company estimates the additional operating week will positively impact fourth quarter and fiscal 2008 diluted earnings per share by $0.01 to $0.02 per share.

This estimate is based, in part, on the following assumptions:

•        New restaurant openings of approximately 35 company-owned; and

•        Comparable restaurant sales growth of approximately 2.0% to 3.0%.

Conference Call

The Company is hosting a conference call today, October 29, 2007, at 5:00 p.m. Eastern Time to discuss these results.  The dial-in number is (888) 206-4835. A replay of the call will be available until November 5, 2007.  To access the replay, please dial (888) 203-1112, and use 4336739 as the pass code.

There will be a simultaneous Web cast conducted at www.texasroadhouse.com.

About the Company

Texas Roadhouse is a casual dining concept that first opened in 1993 and today operates 278 restaurants system-wide in 44 states.  For more information, please visit the Company’s Web site at www.texasroadhouse.com.

Forward-looking Statements

Certain statements in this release that are not historical facts, including, without limitation, those relating to our anticipated financial performance for the full year 2007 and 2008, are forward-looking statements that involve risks and uncertainties.  Such statements are based upon the current beliefs and expectations of the management of the Company.  Actual results may vary materially from those contained in forward-looking statements based on a number of factors including, without limitation, the actual number of restaurants opening during full year 2007 and 2008, the sales at these and our other company-owned and franchise restaurants, our ability to control restaurant operating costs, our ability to integrate the franchise restaurants which we have acquired, strength of consumer spending and other factors disclosed from time to time in the Company’s filings with the U.S. Securities and Exchange Commission.  Investors should take such risks into account when making investment decisions.  Stockholders and other readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date on which they are made.  The Company undertakes no obligation to update any forward-looking statements.

# # #

Contacts:

Investor Relations

Scott Colosi

502-515-7300

Media

Travis Doster

502-638-5457

Texas Roadhouse, Inc. and Subsidiaries

Condensed Consolidated Statements of Income

(in thousands, except per share data)

(unaudited)

	13 Weeks Ended				39 Weeks Ended
	September 25, 2007		September 26, 2006		September 25, 2007		September 26, 2006
Revenue:
Restaurant sales	$	186,879	$	145,859	$	540,452	$		436,804
Franchise royalties and fees	2,575		2,595		8,325		7,769
Total revenue	189,454		148,454		548,777		444,573
Costs and expenses:
Restaurant operating costs:
Cost of sales	65,850		51,243		189,197		153,335
Labor	53,702		40,509		152,281		120,675
Rent	2,913		2,588		8,544		7,397
Other operating	29,628		23,481		86,314		70,374
Pre-opening	2,616		2,948		9,301		8,759
Depreciation and amortization	8,028		5,580		21,903		15,641
General and administrative	9,524		7,864		29,442		25,773
Total costs and expenses	172,261		134,213		496,982		401,954
Income from operations	17,193		14,241		51,795		42,619
Interest expense, net	830		64		1,427		533
Minority interest	98		76		617		361
Equity income from investments in
unconsolidated affiliates	66		47		256		182
Income before taxes	16,331		14,148		50,007		41,907
Provision for income taxes	5,779		4,998		17,902		15,744
Net income	$	10,552	$	9,150	$	32,105	$		26,163
Net income per common share:
Basic	$	0.14	$	0.12	$	0.43	$		0.35
Diluted	$	0.14	$	0.12	$	0.42	$	0.34
Weighted average shares outstanding:
Basic	74,729		74,052		74,556		73,774
Diluted	76,794		76,323		76,846		76,437

Texas Roadhouse, Inc.

Supplemental Financial and Operating Information

Supplemental Financial and Operating Information

($ amounts in thousands)

(unaudited)

	Third Quarter							Change		Year to Date							Change
	2007			2006				vs LY		2007			2006				vs LY
Restaurant openings
Company	5			5				0		22			15				7
Franchise	0			3				(3	)	2			5				(3	)
Total	5			8				(3	)	24			20				4
Restaurant acquisitions
Company	9			0				9		9			11				(2	)
Franchise	(9		)	0				(9	)	(9		)	(11			)	2
Total	0			0				0		0			0				0
Restaurants open at the end of the quarter
Company	194			153				41
Franchise	81			88				(7	)
Total	275			241				34
Company-owned restaurants
Restaurant sales	$	186,879		$	145,859			28.1	%	$	540,452		$	436,804			23.7	%
Store weeks	2,487			1,949				27.6	%	6,926			5,610				23.5	%
Comparable restaurant sales growth (1)	2.5		%	2.3			%	2.0	%	3.4		%
Average unit volume (2)	$	973		$		958		1.6	%	$	3,043		$		3,016		0.9	%
Restaurant costs (as a % of restaurant sales)
Cost of sales	35.2		%	35.1			%	10	bps	35.0		%	35.1			%	(10	)bps
Labor	28.7		%	27.8			%	96	bps	28.2		%	27.6			%	55	bps
Rent	1.6		%	1.8			%	(22	)bps	1.6		%	1.7			%	(11	)bps
Other operating	15.9		%	16.1			%	(24	)bps	16.0		%	16.1			%	(14	)bps
Total	81.4		%	80.8			%	61	bps	80.7		%	80.5			%	20	bps
Franchise-owned restaurants
Franchise royalties and fees	$	2,575		$	2,595			(0.8%	)	$	8,325		$		7,769		7.2	%
Store weeks	1,053			1,122				(6.1%	)	3,348			3,297				1.5	%
Comparable restaurant sales growth (1)	2.0		%	1.8			%	1.5	%	2.5		%
Average unit volume (2)	$	937		$	919			2.0	%	$	2,889		$		2,865		0.8	%
Pre-opening expense	$	2,616		$	2,948			(11.3%	)	$	9,301		$		8,759		6.2	%
Depreciation and amortization	$	8,028		$	5,580			43.9	%	$	21,903		$		15,641		40.0	%
As a % of revenue	4.2		%	3.8			%	48	bps	4.0		%	3.5			%	47	bps
General and administrative expenses	$	9,524		$	7,864			21.1	%	$	29,442		$		25,773		14.2	%
As a % of revenue	5.0		%	5.3			%	(27	)bps	5.4		%	5.8			%	(43	)bps
Interest expense	$	830		$		64		NM		$	1,427		$		533		NM
Minority interest	$	98		$		76		NM		$	617		$		361		NM

(1) Comparable restaurant sales growth includes sales from restaurant open 18 months as of the beginning of the measure period.

(2) Average unit volume includes sales from restaurants open six months as of the beginning of the measurement period.  For comparative purposes, average unit volumes for Q3 2006 and 2006 YTD were adjusted to reflect restaurant sales of the nine acquired franchise restaurants as part of company-owned restaurants average unit volume, rather than franchise-owned restaurants average unit volume.

NM - not meaningful

Amounts may not foot due to rounding.