Capital Spending Measures In NRA’s Performance Index Reach Highest Levels In More Than Five Years

Perhaps it was the avoidance of the fiscal cliff, but something cheered up restaurant operators responding to the January survey for the National Restaurant Association’s Restaurant Performance Index. Seven of the eight RPI indicators were up during the month, pushing the overall index nearly a point higher to 100.6. It was the first month the Index exceeded the 100 level that separates restaurant industry expansion from contraction since September 2012. Both indicators tracking capital spending rose sharply for the second month in a row, reaching levels not seen since ’07.

Current same-store sales and traffic rose, with the sales indicator rising 0.3 point and traffic up a full point. The labor measure was the only index in the RPI to fall in January; it was down 0.2 point.

In the Expectations Index, the outlook for business conditions six months hence, jumped a very strong 2.2 points to 101. It was the first reading above 100 for the business conditions indicator since last September. The expectations for same-store sales rose 0.7 point, while that for staffing was up 0.4 point.

The measure tracking operators that made a capital buy during the past three months rose 1.3 points to 100.3. It was the first time the market exceeded 100 since October ’07. The indicator for intentions to make a capital purchases during the next six months increased 1.8 points. It was the highest reading for the indicators since May ’07. The percentage of operators that made a buy rose to 52% from 45% in December. And 59% of operators plan to make a purchase during the next six months, up from 50% in December.