Raymond James, Superior Group, Bloomin’ post strong earnings gains

A booming stock market, a restaurant craving and continued demand for personal protective equipment were among the factors driving quarterly earnings gains at three of the largest companies in the Tampa-St. Petersburg area.

Raymond James Financial, Bloomin’ Brands and Superior Group of Companies each reported increases in net income for the three months ended March 31, compared to the same period in 2020.

Raymond James and Superior also posted year-over-year revenue gains. Bloomin’ had a slight drop in revenue for the just-ended quarter compared to a year ago, but revenue for the quarter ended in March 2021 was significantly higher than revenue for the previous three months that ended in December 2020.

Here’s a closer look at the factors driving each company’s financial reports.

$1 trillion in assets under administration

Raymond James Financial (NYSE: RJF), a financial services company headquartered in St. Petersburg and one of the city’s largest companies, said the 15 percent increase in net revenue for the second quarter of its fiscal year was primarily driven by higher asset management and related administrative fees, investment banking revenue and brokerage revenue. Those gains were partially offset by the impact of lower short-term interest rates and Raymond James Bank deposit program fees from third-party banks.

The company’s private client group, which provides financial planning, investment advice and securities transaction services, saw assets under administration top $1 trillion, in large part due to stock market appreciation and the addition of more financial advisors. Gains in the capital markets group were powered by investment banking services, such as working on corporate stock offerings and helping companies with merger and acquisitions. Raymond James also completed its own previously announced acquisition of Financo, a boutique investment bank focused on the consumer sector.

It’s been a year since the financial markets bottomed, Paul Reilly, chairman and CEO, said in a conference call with analysts. Since then, the stock market has seen an incredible run with the S&P 500 up 54 percent year over year, he said.

“While that tailwind has certainly helped fuel our strong results, the records we generated during the quarter and first half of the fiscal year have also been driven by our unwavering commitment to providing excellent service to advisors and their clients during this difficult and unprecedented time,” he said.

Emerging from Covid

International comparable restaurant sales were down at Bloomin’ Brands (Nasdaq; BLMN), a Tampa-based casual dining restaurant company. The company has a big presence in Brazil, where sales have been impacted by a rise in Covid-19 cases that closed or limited capacity inside restaurants.

But U.S. comparable restaurant sales were up at Outback Steakhouse and Carrabba’s Italian Grill. Sales at Bonefish Grill and Fleming’s Steakhouse & Wine Bar still remain slightly below the level they were at in the first quarter of 2020.

The Q1 2021 results reinforce the company’s belief that its strategies and tactics are working, David Deno, CEO, said during a conference call.

“The first quarter performance was the culmination of a multi-year effort to elevate the guest experience, grow healthy traffic and pursue operational and simplification efforts to improve margins and profitability,” Deno said. “This was accomplished by first and foremost taking care of our people and customers.”

The company did not furlough any employees during the pandemic – a decision that has contributed to low turnover, he said. Maintaining a motivated, well-trained and engaged employee base is critical to the company’s long-term success.

“Sales volumes are now exceeding pre-pandemic levels. These actions provide a competitive advantage to retaining talent as the industry faces staffing challenges,” he said.

Bloomin’ is focused on providing great food and service in its dining room, even while to-go and delivery businesses continue to perform well, Deno said. The company has simplified its menus, which has led to lower waste, reduced prep and training hours, and improved execution – benefits that translate into lower costs, he said.

The latest round of government stimulus also has been a catalyst for sales increases, said Chris Meyer, executive vice president and chief financial officer.

Economic outlook

Superior (Nasdaq: SGC), based in Seminole, has divisions focused on uniforms and apparel, promotional products and call centers.

While combined sales were up 49.4 percent in the just-ended quarter compared to a year ago, the promotional products division, BAMKO, posted a 125 percent sales gain. That division produces the personal protective equipment that’s been in high demand during the Covid-19 pandemic, but core promotional product sales are rebounding at a faster pace and beginning to replace PPE business at a higher level, Michael Benstock, Superior’s CEO, told analysts on a conference call.

The uniform division has tentacles into a wide range of industries, so Benstock used the conference call to report on what he’s seeing in the broader economy.

“Travel, transportation, dining and entertainment are seeing a resurgence in activity after being nearly dormant,” he said.

Hiring is in full force in preparation for reopening or capacity increases, and entertainment venues such as theme parks and movie theaters are showing signs of life.

Hotels saw a 93 percent increase in occupancy with much of the business going to limited service hotels.

Quick service restaurant transactions were up 29 percent year-over-year.

Transportation is showing renewed strength, and Benstock said he expects to see a normalization in essential businesses such as pharmacy, grocery and big box retailers.