UPDATE 1-Red Robin Q1 profit falls, sees bleak '09

* Q1 EPS ex items 44 cents

* Sees restaurant-level oper margin decline in FY09

* Expects traffic to remain negative in '09

* Shares fall 14 pct

May 21 (Reuters) - Red Robin Gourmet Burgers Inc (RRGB.O), a casual dining restaurant chain, nearly halved its quarterly profit and said it expects certain costs to pressure restaurant-level profitability in fiscal 2009, sending its shares down 14 percent.

The company said, without any menu price increases, restaurant-level operating margins could decline by 50 to 80 basis points during fiscal year 2009.

For every 10 basis point change in restaurant level operating profit, diluted earnings are estimated to be impacted by about 4 cents a share, it added.

The company, whose rivals include Ruby Tuesday Inc (RT.N), DineEquity Inc (DIN.N) and Brinker International Inc (EAT.N), said it expects costs such as minimum wage increases and select commodity cost increases to continue to put pressure on restaurant-level profitability.

Red Robin and other mid-tier restaurants have been witnessing diminishing traffic as customers continue to be lured by cheaper options such as eating more meals at home and growing their own fruits and vegetables amid the financial turmoil. For the first quarter, the company earned $3.8 million, 25 cents a share, compared with $7.3 million, or 43 cents a share, a year earlier.

Excluding items, it earned 44 cents a share, while analysts were expecting a profit of 33 cents a share, according to Reuters Estimates.

Total revenue rose 6 percent to $270.8 million.

Shares of the Greenwood Village, Colorado-based company fell to $18.66 in trading after the bell. They closed at $21.61 Thursday on Nasdaq. (Reporting by Amitha Rajan in Bangalore; Editing by Aradhana Aravindan)