Any way you look at it, things look grim for Ruby Tuesday. The casual-restaurant chain reported on Wednesday that its profits declined 97 percent in its fiscal first quarter. It is saddled with $857 million in debt. Like all of its competitors, it is dealing with sinking demand and rising costs of labor and ingredients.

But does that mean Ruby Tuesday is going to follow Bennigan's into bankruptcy? Probably not anytime soon.

For one thing, despite falling profits, cash flows are decent. That's what helped it pay down $40 million in debt during the quarter.

The chain recently underwent what it calls a "reimaging" (you may have seen the TV spots that make fun of its previous '70s-style décor). The idea was to move out of the crowded "bar and grill" category and cast itself as a more-upscale eatery with higher-quality offerings. The store refurbishments and menu changes were largely completed by the time the recession hit, and the company has abandoned its ambitious expansion plans, so capital expenditures are now minimal.

The company is reviewing all of its holdings and says it is looking to cast off real estate and close its underperforming stores.

In a conference call with analysts, CEO Samuel Beall said, "We've got about $35 million or $38 million of excess real estate that we are trying to sell rather fast." That includes both undeveloped property and stores that have already closed. On top of that, he said, about 50 stores are "negative cash flow losers" that could be dispensed with.

The chain operates about 950 outlets, roughly two-thirds of them owned by companies and the rest by franchisees.

Executives on the conference call emphasized the company's relatively good cash flows, and with good reason. Last month, SeekingAlpha writer Bernard Dussault, who owns stock in the company, wrote:

"What one has to realize here though is that good earnings are not necessarily correlated with a company's ability to re-invest in the business, give a dividend, repurchase shares, or repay its debt. These actions can often only be made possible by the accumulation of large free cash flows, a number that not many people in the market tend to look at."

Of course, for there to be cash flows, there needs to be cash, and if things get much worse for the consumer economy, Ruby Tuesday could be in even worse trouble. But it doesn't seem to be there yet.

Look for other restaurant chains, particularly those financed by private equity, to be the next to fall.