Dive Brief:

• Bloomin’ Brands’ CEO Liz Smith will step down from her role April 1, but will assume the post of executive chairman of the company’s board, according to a company release. CFO Dave Deno will move into the CEO spot. Restaurant Business reports this was a planned succession. 
• Smith has been the CEO of Bloomin' Brands — parent company of Outback Steakhouse, Carrabba's Italian Grill, Bonefish Grill and Fleming's Prime Steakhouse — for the past 10 years. 
• In the fall, activist investors pressured Bloomin' Brands to rethink Smith's strategy, specifically calling for the company to sell its Carrabba's, Bonefish and Fleming's brands. Barington Capital Group also urged Bloomin' to give Smith's responsibilities as board chairman to an outsider. 

Dive Insight:

Smith took over Bloomin' Brands at a tumultuous time. According to Restaurant Business, the company lost $739.4 million the year prior, when the casual dining segment in general was struggling to compete with a nascent fast casual category and consumers’ demands began shifting to faster service models. 

Smith is credited with forging a turnaround that in Q4 yielded a comp sales increase of 1.6% — the fifth consecutive quarter of positive U.S. comp sales. This effort was led by a 4% jump at Outback Steakhouse, its highest annual comp result in six years. A focus on delivery and restaurant redesigns, as well as a move away from discounting, have helped boost the business as of late. In a news release, Bloomin’ independent director Jim Craigie said her leadership transformed the company’s brands and set them up with sustainable platforms for growth. 

Despite this trajectory, activist pressure intensified toward the end of last year, as annual revenues remained down. According to Business Observer, Bloomin’s revenues were $4.38 billion in 2015 and $4.13 billion in 2018. Though Bonefish and Fleming’s have both generated slightly positive comp sales, all three of Outback’s sister chains have experienced a significant decline in traffic. Traffic declines, however, are hindering the entire industry, so Deno will have his work cut out for him to turn that trend around at those three brands.  

Another narrative coming from Smith’s move is that it leaves just three female CEOs of publicly-owned restaurant chains — Cracker Barrel, Ruth's Hospitality Group and Red Robin. In 2017, three female CEOs departed. The industry remains above average; A study by McKinsey & Co. found that 23% of c-suite executives in the industry are women, compared to 20% of c-suite executives across all industries. But this is in an industry in which a majority of all workers are female. According to the State of Women in the Restaurant and Food Industry, 52% of all restaurant workers are women, while 71% of servers are. Smith's departure further widens the gap between industry-wide demographics and leadership demographics.