CALABASAS HILLS, Calif., Oct 17, 2002 (BUSINESS WIRE) -- The Cheesecake Factory
Incorporated (Nasdaq:CAKE) today reported record financial results for the third
quarter of fiscal 2002 that ended October 1, 2002. Highlights for the third
quarter, compared to the same quarter last year, were as follows:
- Total revenues up 18% to $162.0 million
- Net income up 24% to $12.1 million
- Diluted net income per share up 20% to $0.24
Financial results for the fiscal quarter ended October 1, 2002 include expenses
amounting to approximately $0.02 per diluted share related to the Company's
previously-announced voluntary withdrawal of bakery products that were produced
in the Company's central bakery production facility during a four-day period in
July 2002. These expenses are included in the "other operating expenses" line in
the Company's Consolidated Statement of Operations and represent the estimated
total financial impact of the withdrawal.
"Once again, our business achieved strong increases in revenues and earnings
during the third quarter, which was particularly impressive when considering the
difficult operating environment and the impact of the bakery product
withdrawal," said David Overton, Chairman and CEO. "Our 1.1% increase in
comparable restaurant sales during the quarter closely approximated the current
price increase in our menu, which is all that we expect to achieve given our
industry-leading sales productivity metrics. Our record of 41 consecutive
quarters of positive same-store sales comparisons is particularly impressive
when considering that we do not utilize media advertising or discounting to
support our sales volumes."
The Company opened three restaurants during the quarter ended October 1, 2002,
including a third Grand Lux Cafe location in Chicago, Illinois and Cheesecake
Factory locations in Summerlin, Nevada and Ft. Lauderdale, Florida. Of the five
Cheesecake Factory restaurants that are expected to open during the fourth
quarter of fiscal 2002, a location in St. Louis, Missouri was opened on October
8, 2002, and a location in Orlando, Florida is scheduled to open on October 18,
2002. The remaining three locations planned to open by mid-December are San
Jose, California; Austin, Texas; and Charlotte, North Carolina. The Company
currently plans to open as many as 14 full-service Cheesecake Factory
restaurants during fiscal 2003, of which all potential locations have been
identified. Five signed leases are in hand for potential 2003 openings, and the
Company expects to have signed substantially all of the leases for the remainder
of the potential 2003 locations by the end of the current year.
The Company's bakery operations have requalified as an approved supplier to
Darden Restaurants. "We are grateful to have the opportunity to continue our
16-year relationship with Darden, one of the world's most highly respected
restaurant companies," commented Overton.
The Company also announced two executive appointments today. "We recognized
that, in order to effectively manage our growing operations, moving to a
business unit organizational structure would be of longer-term benefit to the
Company," said Overton. "Earlier this summer, we were delighted to appoint
Michael Berry as President and Chief Operating Officer of The Cheesecake Factory
Restaurants, our flagship restaurant concept. Mike's impact on our Cheesecake
Factory restaurant operations has been truly impressive during his first four
months on the job." The two executive appointments announced today were as
follows:
- Gerald Deitchle has been appointed President of The Cheesecake
Factory Incorporated. Deitchle will retain the title of Chief
Financial Officer and will remain the primary analyst contact
for the Company. "Since joining our Company in 1995, Jerry has
played a key role in the financial and operational development
of our business," said Overton. "I have great confidence in
his ability to lead our corporate team in providing quality
support services to our restaurant and bakery operations."
Michael Dixon, the Company's Vice President - Finance,
Controller and Chief Accounting Officer, will assume some of
Deitchle's prior duties.
- Peter D'Amelio has been appointed President and Chief
Operating Officer of the Company's Grand Lux Cafe Restaurants.
D'Amelio joined the Company in 1990 and has steadily advanced
through the Company's operations organization, with his most
recent position as Senior Vice President - Operations. "I am
excited for both Peter and Grand Lux Cafe," commented Overton.
"During the past 12 years, Peter has been instrumental in
managing the growth and success of The Cheesecake Factory. His
outstanding operational and leadership skills will be of great
value in our efforts to prepare Grand Lux Cafe for further
growth." D'Amelio's former duties will be assumed by newly
appointed Regional Vice Presidents Jack Belk and Wayne Jones.
Berry, D'Amelio and Deitchle will report directly to Overton, who remains
Chairman and CEO. "I am looking forward to working closely with our capable
business unit and corporate executives to successfully execute our aggressive
growth plans," said Overton.
The Company's quarterly investor conference call will be available to the public
live through the Internet at 2:00 p.m. Pacific Time on Thursday, October 17,
2002. To access, select the "Audio Webcasts" option under the "Investor" section
of the Company's website located at www.thecheesecakefactory.com at least 15
minutes prior to the start of the call to register and download any necessary
audio software. An archived webcast of the call will be available through
November 4, 2002.
This press release contains forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995. Forward-looking statements
involve known and unknown risks, uncertainties and other factors that may cause
the actual results, performance or achievements of the Company to be materially
different from any future results, performance or achievements expressed or
implied by forward-looking 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. In particular,
forward-looking statements regarding the Company's sales and earnings trends are
subject to risks and uncertainties due to national and regional economic and
public safety conditions that impact consumer confidence and spending.
Additionally, forward-looking statements regarding the number and timing of the
Company's anticipated new restaurant openings are subject to factors outside of
its control, including factors that are under the control of government agencies
and the Company's landlords. Forward-looking statements speak only as of the
dates on which they were made. 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 the securities laws. Investors
are referred to the full discussion of risks and uncertainties associated with
forward-looking statements contained in the Company's filings with the
Securities and Exchange Commission.
The Cheesecake Factory Incorporated operates 55 upscale, casual dining
restaurants under The Cheesecake Factory(R) name that offer an extensive menu of
more than 200 items with an average check of approximately $15.70. The Company
also operates a bakery production facility that produces over 50 varieties of
quality cheesecakes and other baked products for the Company's restaurants and
for other leading foodservice operators, retailers and distributors.
Additionally, the Company operates three upscale casual dining restaurants under
the Grand Lux Cafe(R) name in Los Angeles, California, Las Vegas, Nevada and
Chicago, Illinois; one self-service, limited menu "express" foodservice
operation under The Cheesecake Factory Express(R) mark inside the DisneyQuest(R)
family entertainment center in Orlando, Florida; and licenses three bakery cafe
outlets to another foodservice operator under The Cheesecake Factory Bakery
Cafe(R) name.
The Cheesecake Factory Incorporated and Subsidiaries
Consolidated Financial Statements
(unaudited; in thousands, except per share and statistical data)
Consolidated Statements of Operations
13 Weeks Ended 13 Weeks Ended
October 1, 2002 October 2, 2001
Revenues: Amounts Percents Amounts Percents
Restaurant sales $152,916 94.4% $128,552 93.4%
Bakery sales to other
foodservice operators,
retailers and distributors 9,066 5.6% 9,068 6.6%
Total revenues 161,982 100.0% 137,620 100.0%
Costs and expenses:
Restaurant cost of sales (1) 35,763 22.1% 32,774 23.8%
Bakery cost of sales (2) 3,937 2.4% 4,470 3.3%
Labor expenses 50,248 31.0% 42,163 30.6%
Other operating expenses (3) 39,110 24.1% 30,559 22.2%
General and administrative
expenses 7,580 4.7% 6,898 5.0%
Depreciation and amortization
expenses 5,909 3.6% 4,551 3.3%
Preopening costs 2,192 1.4% 2,013 1.5%
Total costs and expenses 144,739 89.3% 123,428 89.7%
Income from operations 17,243 10.7% 14,192 10.3%
Interest income, net 1,048 0.6% 1,012 0.7%
Other income, net 499 0.3% 73 0.1%
Income before income taxes 18,790 11.6% 15,277 11.1%
Income tax provision 6,708 4.1% 5,500 4.0%
Net income $12,082 7.5% $9,777 7.1%
Basic net income per share (4) $0.24 $0.21
Basic weighted average shares
outstanding (4) 49,602 47,512
Diluted net income per share (4) $0.24 $0.20
Diluted weighted average shares
outstanding (4) 51,137 49,986
39 Weeks Ended 39 Weeks Ended
October 1, 2002 October 2, 2001
Revenues: Amounts Percents Amounts Percents
Restaurant sales $441,756 92.5% $365,142 93.5%
Bakery sales to other
foodservice operators,
retailers and distributors 35,820 7.5% 25,234 6.5%
Total revenues 477,576 100.0% 390,376 100.0%
Costs and expenses:
Restaurant cost of sales (1) 105,173 22.0% 93,249 23.9%
Bakery cost of sales (2) 16,744 3.5% 12,383 3.2%
Labor expenses 147,127 30.8% 119,954 30.7%
Other operating expenses (3) 109,818 23.0% 87,327 22.4%
General and administrative
expenses 23,453 4.9% 20,206 5.2%
Depreciation and amortization
expenses 16,620 3.5% 12,525 3.2%
Preopening costs 7,187 1.5% 4,861 1.2%
Total costs and expenses 426,122 89.2% 350,505 89.8%
Income from operations 51,454 10.8% 39,871 10.2%
Interest income, net 3,038 0.6% 3,450 0.9%
Other income, net 1,333 0.3% 998 0.3%
Income before income taxes 55,825 11.7% 44,319 11.4%
Income tax provision 19,929 4.2% 15,955 4.1%
Net income $35,896 7.5% $28,364 7.3%
Basic net income per share (4) $0.73 $0.60
Basic weighted average shares
outstanding (4) 49,082 47,388
Diluted net income per share (4) $0.70 $0.57
Diluted weighted average shares
outstanding (4) 51,074 49,782
Selected Consolidated Balance
Sheet Information
October 1, 2002 January 1, 2002
Cash and marketable securities $110,400 $92,284
Total assets 424,493 356,927
Total liabilities 67,148 67,456
Total stockholders' equity 357,345 289,471
Supplemental Information
13 Weeks 13 Weeks 39 Weeks 39 Weeks
Ended Ended Ended Ended
Oct. 1, Oct. 2, Oct. 1, Oct. 2,
2002 2001 2002 2001
Comparable restaurant
sales % change 1.1% 0.9% 1.6% 1.7%
Restaurant cost of sales
% of restaurant sales 23.4% 25.5% 23.8% 25.5%
Bakery cost of sales
% of bakery sales 43.4% 49.3% 46.7% 49.1%
Restaurants opened
during period 3 3 7 6
Restaurants open at
period-end 58 48 58 48
Restaurant operating
weeks 731 610 2,120 1,769
Operating income before
preopening costs $19,435 $16,205 $58,641 $44,732
Operating income margin
before preopening costs 12.0% 11.8% 12.3% 11.4%
Notes:
(1) Consists of restaurant food, beverage and dessert costs.
(2) Consists of bakery ingredient, packaging and supply costs.
(3) For the 13-week period ended October 1, 2002, includes
expenses of $2.1 million (approximately $0.02 per diluted share)
related to the voluntary withdrawal of bakery products that were
produced in the Company's bakery production facility during a
four-day period in July 2002.
(4) Reflects a 3-for-2 stock split effective June 18, 2001.
CONTACT:
The Cheesecake Factory, Calabasas Hills
Jane Vallaire, 818/871-3000
URL: http://www.businesswire.com
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