The Cheesecake Factory Reports Results for First Quarter of Fiscal 2024
The Cheesecake Factory Incorporated (NASDAQ: CAKE) reported total revenues of $891.2 million for the first quarter of fiscal 2024, with net income of $33.2 million and diluted net income per share of $0.68. Comparable restaurant sales declined by 0.6% year-over-year. The Company opened five new restaurants during the quarter and expects to open up to 22 new restaurants in fiscal 2024. The Company had total available liquidity of $296.7 million as of April 2, 2024. The Board of Directors declared a quarterly dividend of $0.27 per share.
Continued growth in total revenues year-over-year.
Successful opening of five new restaurants during the quarter.
Expectation to open up to 22 new restaurants in fiscal 2024.
Strong liquidity position with total available liquidity of $296.7 million.
Declaration of a quarterly dividend of $0.27 per share by the Board of Directors.
Decline in comparable restaurant sales by 0.6% year-over-year.
Recorded pre-tax net expense of $3.2 million related to impairment of assets and lease termination expenses.
Total revenues were
The Company recorded a pre-tax net expense of
Comparable restaurant sales at The Cheesecake Factory restaurants declined
“The Cheesecake Factory restaurants comparable sales and traffic once again meaningfully outperformed the industry,” said David Overton, Chairman and Chief Executive Officer. “Our first quarter sales improved throughout the quarter culminating at the high-end of our expectations. Our operators continued to deliver improvements in labor productivity, food efficiency, and hourly staff and manager retention, all of which contributed to significant growth in profitability.”
“Our success is undeniably linked to the hard work and dedication of our experienced restaurant teams who enable us to deliver the distinct, high quality dining experiences that have distinguished The Cheesecake Factory as one of the most differentiated restaurant concepts in the casual dining industry for over 45 years. We are honored to have been named to the Fortune magazine '100 Best Companies to Work For' list for the 11th consecutive year, reinforcing our belief that we are an employer of choice.”
Development
During the first quarter of fiscal 2024, the Company opened five new restaurants, including two North Italia restaurants, two FRC restaurants, and one Flower Child location. In addition, one Cheesecake Factory restaurant opened internationally under a licensing agreement in
The Company continues to expect to open as many as 22 new restaurants in fiscal 2024, including as many as three to four The Cheesecake Factory restaurants, six to seven North Italia restaurants, six to seven Flower Child locations, and six to seven FRC restaurants.
Liquidity and Capital Allocation
As of April 2, 2024, the Company had total available liquidity of
The Company repurchased approximately 359,400 shares of its stock at a cost of
Conference Call and Webcast
The Company will hold a conference call to review its results for the first quarter of fiscal 2024 today at 2:00 p.m. Pacific Time. The conference call will be webcast live on the Company’s website at investors.thecheesecakefactory.com and a replay of the webcast will be available through June 7, 2024.
About The Cheesecake Factory Incorporated
The Cheesecake Factory Incorporated is a leader in experiential dining. We are culinary forward and relentlessly focused on hospitality. Delicious, memorable experiences created by passionate people – this defines who we are and where we are going. We currently own and operate 335 restaurants throughout
From Fortune. ©2024 Fortune Media IP Limited. All rights reserved. Used under license. Fortune® and Fortune 100 Best Companies to Work For® are registered trademarks of Fortune Media IP Limited and are used under license. Fortune and Fortune Media IP Limited are not affiliated with, and do not endorse products or services of, The Cheesecake Factory Incorporated.
Safe Harbor Statement
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, as codified in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements include, without limitation, statements regarding restaurant development. Such forward-looking statements include all other statements that are not historical facts, as well as statements that are preceded by, followed by or that include words or phrases such as “believe,” “plan,” “will likely result,” “expect,” “intend,” “will continue,” “is anticipated,” “estimate,” “project,” “may,” “could,” “would,” “should” and similar expressions. These statements are based on current expectations and involve risks and uncertainties which may cause results to differ materially from those set forth in such statements. Investors are cautioned that forward-looking statements are not guarantees of future performance and that undue reliance should not be placed on such statements. These forward-looking statements may be affected by various factors including: economic, public health and political conditions that impact consumer confidence and spending, including increased interest rates, periods of heightened inflation and market instability, and armed conflicts; supply chain disruptions; demonstrations, political unrest, potential damage to or closure of the Company’s restaurants and potential reputational damage to the Company or any of its brands; pandemics and related containment measures, including the potential for quarantines or restriction on in-person dining; acceptance and success of The Cheesecake Factory in international markets; acceptance and success of North Italia, Flower Child and Other Fox Restaurant Concepts restaurants; the risks of doing business abroad through Company-owned restaurants and/or licensees; foreign exchange rates, tariffs and cross border taxation; changes in unemployment rates; increases in minimum wages and benefit costs; the economic health of the Company’s landlords and other tenants in retail centers in which its restaurants are located, and the Company’s ability to successfully manage its lease arrangements with landlords; the economic health of suppliers, licensees, vendors and other third parties providing goods or services to the Company; the timing of new unit development and related permitting; compliance with debt covenants; strategic capital allocation decisions including with respect to share repurchases or dividends; the ability to achieve projected financial results; the resolution of uncertain tax positions with the Internal Revenue Service and the impact of tax reform legislation; changes in laws impacting the Company’s business; adverse weather conditions in regions in which the Company’s restaurants are located; factors that are under the control of government agencies, landlords and other third parties; the risks, costs and uncertainties associated with opening new restaurants; and other risks and uncertainties detailed from time to time in the Company’s filings with the Securities and Exchange Commission (“SEC”). Forward-looking statements speak only as of the dates on which they are made, and the Company undertakes no obligation to publicly update or revise any forward-looking statements or to make any other forward-looking statements, whether as a result of new information, future events or otherwise, unless required to do so by law. Investors are referred to the full discussion of risks and uncertainties associated with forward-looking statements and the discussion of risk factors contained in the Company’s latest Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K as filed with the SEC, which are available at www.sec.gov.
| The Cheesecake Factory Incorporated | ||||||||||
| Condensed Consolidated Financial Statements | ||||||||||
| (unaudited; in thousands, except per share and statistical data) | ||||||||||
| 13 Weeks Ended | 13 Weeks Ended | |||||||||
| Consolidated Statements of Income | April 2, 2024 | April 4, 2023 | ||||||||
Amount |
Percent of
|
Amount |
Percent of
|
|||||||
| Revenues | $ |
891,223 |
|
|
$ |
866,114 |
|
|
||
| Costs and expenses: | ||||||||||
| Food and beverage costs |
|
203,253 |
|
|
|
206,224 |
|
|
||
| Labor expenses |
|
320,930 |
|
|
|
311,528 |
|
|
||
| Other operating costs and expenses |
|
233,541 |
|
|
|
230,929 |
|
|
||
| General and administrative expenses |
|
60,366 |
|
|
|
54,069 |
|
|
||
| Depreciation and amortization expenses |
|
24,756 |
|
|
|
22,955 |
|
|
||
| Impairment of assets and lease termination expenses |
|
2,083 |
|
|
|
2,242 |
|
|
||
| Acquisition-related contingent consideration, compensation and amortization expenses |
|
1,121 |
|
|
|
1,189 |
|
|
||
| Preopening costs |
|
5,880 |
|
|
|
3,052 |
|
|
||
| Total costs and expenses |
|
851,930 |
|
|
|
832,188 |
|
|
||
| Income from operations |
|
39,293 |
|
|
|
33,926 |
|
|
||
| Interest and other expense, net |
|
(1,761 |
) |
(0.2)% |
|
(1,880 |
) |
(0.2)% |
||
| Income before income taxes |
|
37,532 |
|
|
|
32,046 |
|
|
||
| Income tax provision |
|
4,341 |
|
|
|
3,996 |
|
|
||
| Net income | $ |
33,191 |
|
|
$ |
28,050 |
|
|
||
| Basic net income per share | $ |
0.70 |
|
$ |
0.58 |
|
||||
| Basic weighted average shares outstanding |
|
47,749 |
|
|
48,694 |
|
||||
| Diluted net income per share | $ |
0.68 |
|
$ |
0.56 |
|
||||
| Diluted weighted average shares outstanding |
|
48,662 |
|
|
49,778 |
|
||||
| 13 Weeks Ended | 13 Weeks Ended | |||||||||||
| Selected Segment Information | April 2, 2024 | April 4, 2023 | ||||||||||
| Revenues: | ||||||||||||
| The Cheesecake Factory restaurants | $ |
667,794 |
|
$ |
656,000 |
|
||||||
| North Italia |
|
70,874 |
|
|
63,303 |
|
||||||
| Other FRC |
|
74,229 |
|
|
68,640 |
|
||||||
| Other |
|
78,326 |
|
|
78,171 |
|
||||||
| Total | $ |
891,223 |
|
$ |
866,114 |
|
||||||
| Income/(loss) from operations: | ||||||||||||
| The Cheesecake Factory restaurants | $ |
86,071 |
|
$ |
78,386 |
|
||||||
| North Italia |
|
3,170 |
|
|
4,606 |
|
||||||
| Other FRC |
|
6,292 |
|
|
8,711 |
|
||||||
| Other |
|
(56,240 |
) |
|
(57,777 |
) |
||||||
| Total | $ |
39,293 |
|
$ |
33,926 |
|
||||||
| Depreciation and amortization expenses: | ||||||||||||
| The Cheesecake Factory restaurants | $ |
16,843 |
|
$ |
16,018 |
|
||||||
| North Italia |
|
1,971 |
|
|
1,467 |
|
||||||
| Other FRC |
|
2,425 |
|
|
1,927 |
|
||||||
| Other |
|
3,517 |
|
|
3,543 |
|
||||||
| Total | $ |
24,756 |
|
$ |
22,955 |
|
||||||
| Impairment of assets and lease termination expenses: | ||||||||||||
| The Cheesecake Factory restaurants | $ |
1,859 |
|
$ |
93 |
|
||||||
| North Italia |
|
- |
|
|
- |
|
||||||
| Other FRC |
|
- |
|
|
55 |
|
||||||
| Other |
|
224 |
|
|
2,094 |
|
||||||
| Total | $ |
2,083 |
|
$ |
2,242 |
|
||||||
| Preopening costs: | ||||||||||||
| The Cheesecake Factory restaurants | $ |
1,758 |
|
$ |
1,448 |
|
||||||
| North Italia |
|
2,002 |
|
|
446 |
|
||||||
| Other FRC |
|
1,724 |
|
|
721 |
|
||||||
| Other |
|
396 |
|
|
437 |
|
||||||
| Total | $ |
5,880 |
|
$ |
3,052 |
|
||||||
| 13 Weeks Ended | 13 Weeks Ended | |||||||||||
| The Cheesecake Factory restaurants operating information: | April 2, 2024 | April 4, 2023 | ||||||||||
| Comparable restaurant sales vs. prior year |
|
(0.6 |
)% |
|
5.7 |
% |
||||||
| Restaurants opened during period |
|
- |
|
|
- |
|
||||||
| Restaurants open at period-end |
|
216 |
|
|
210 |
|
||||||
| Restaurant operating weeks |
|
2,807 |
|
|
2,737 |
|
||||||
| North Italia operating information: | ||||||||||||
| Comparable restaurant sales vs. prior year |
|
3 |
% |
|
9 |
% |
||||||
| Restaurants opened during period |
|
2 |
|
|
- |
|
||||||
| Restaurants open at period-end |
|
38 |
|
|
33 |
|
||||||
| Restaurant operating weeks |
|
480 |
|
|
429 |
|
||||||
| Other Fox Restaurant Concepts (FRC) operating information:(1) | ||||||||||||
| Restaurants opened during period |
|
2 |
|
|
1 |
|
||||||
| Restaurants open at period-end |
|
42 |
|
|
35 |
|
||||||
| Restaurant operating weeks |
|
528 |
|
|
451 |
|
||||||
| Other operating information:(2) | ||||||||||||
| Restaurants opened during period |
|
1 |
|
|
1 |
|
||||||
| Restaurants open at period-end |
|
40 |
|
|
40 |
|
||||||
| Restaurant operating weeks |
|
516 |
|
|
515 |
|
||||||
| Number of company-owned restaurants: | ||||||||||||
| The Cheesecake Factory |
|
216 |
|
|||||||||
| North Italia |
|
38 |
|
|||||||||
| Other FRC |
|
42 |
|
|||||||||
| Other |
|
40 |
|
|||||||||
| Total |
|
336 |
|
|||||||||
| Number of international-licensed restaurants: | ||||||||||||
| The Cheesecake Factory |
|
33 |
|
|||||||||
(1) The Other FRC segment includes all FRC brands except Flower Child. |
||||||||||||
(2) The Other segment includes the Flower Child, Grand Lux Cafe and Social Monk Asian Kitchen concepts, as well as the Company's third-party bakery, international and consumer packaged goods businesses, unallocated corporate expenses and gift card costs. |
||||||||||||
| Selected Consolidated Balance Sheet Information | April 2, 2024 | January 2, 2024 | ||||||||||
| Cash and cash equivalents | $ |
60,220 |
$ |
56,290 |
||||||||
| Long-term debt, net of issuance costs (1) |
|
470,551 |
|
470,047 |
||||||||
(1) Includes |
||||||||||||
Reconciliation of Non-GAAP Results to GAAP Results
In addition to the results provided in accordance with accounting principles generally accepted in
| The Cheesecake Factory Incorporated | ||||||||||
| Reconciliation of Non-GAAP Financial Measures | ||||||||||
| (unaudited; in thousands, except per share data) | ||||||||||
| 13 Weeks Ended | 13 Weeks Ended | |||||||||
| April 2, 2024 | April 4, 2023 | |||||||||
| Net income (GAAP) | $ |
33,191 |
|
$ |
28,050 |
|
||||
| Impairment of assets and lease termination expenses(1) |
|
2,083 |
|
|
2,242 |
|
||||
| Acquisition-related contingent consideration, compensation and amortization expenses(2) |
|
1,121 |
|
|
1,189 |
|
||||
| Tax effect of adjustments(3) |
|
(833 |
) |
|
(892 |
) |
||||
| Adjusted net income (non-GAAP) | $ |
35,562 |
|
$ |
30,589 |
|
||||
| Diluted net income per share (GAAP) | $ |
0.68 |
|
$ |
0.56 |
|
||||
| Impairment of assets and lease termination expenses |
|
0.04 |
|
|
0.05 |
|
||||
| Acquisition-related contingent consideration, compensation and amortization expenses |
|
0.02 |
|
|
0.02 |
|
||||
| Tax effect of adjustments |
|
(0.02 |
) |
|
(0.02 |
) |
||||
| Adjusted net income per share (non-GAAP)(4) | $ |
0.73 |
|
$ |
0.61 |
|
||||
(1) A detailed breakdown of impairment of assets and lease termination expenses recorded in the thirteen weeks ended April 2, 2024 and April 4, 2023 can be found in the Selected Segment Information table. |
||||||
(2) Represents changes in the fair value of the deferred consideration and contingent consideration and compensation liabilities related to the North Italia and FRC acquisition, as well as amortization of acquired definite-lived licensing agreements. |
||||||
(3) Based on the federal statutory rate and an estimated blended state tax rate, the tax effect on all adjustments assumes a |
||||||
(4) Adjusted net income per share may not add due to rounding. |
View source version on businesswire.com: https://www.businesswire.com/news/home/20240508744934/en/
Etienne Marcus
(818) 871-3000
investorrelations@thecheesecakefactory.com
Source: The Cheesecake Factory Incorporated
FAQ
What were the total revenues reported by The Cheesecake Factory for the first quarter of fiscal 2024?
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What was the change in comparable restaurant sales for The Cheesecake Factory in the first quarter of fiscal 2024?
What was the Company's total available liquidity as of April 2, 2024?
