Company Announces 17 Percent Increase In Quarterly Dividend and
Increase In Share Repurchase Authorization
CALABASAS HILLS, Calif.--(BUSINESS WIRE)--Jul. 24, 2013--
The Cheesecake Factory Incorporated (NASDAQ: CAKE) today reported
financial results for the second quarter of fiscal 2013, which ended on
July 2, 2013.
Total revenues were $470.1 million in the second quarter of fiscal 2013
as compared to $454.7 million in the prior year second quarter. Net
income and diluted net income per share were $28.6 million and $0.52,
respectively, in the second quarter of fiscal 2013.
The Company recorded a pre-tax charge during the second quarter of
fiscal 2013 related to the planned relocation of two The Cheesecake
Factory restaurants. The amount of the charge was approximately $1.5
million, which decreased diluted net income per share by approximately
$0.02. Excluding this item, net income was $29.5 million and diluted net
income per share was $0.54.
Operating Results
Comparable restaurant sales at The Cheesecake Factory and Grand Lux Cafe
increased 0.8% in the second quarter of fiscal 2013.
By concept, comparable restaurant sales grew 0.9% at The Cheesecake
Factory and grew 0.1% at Grand Lux Cafe.
“We delivered our 14th consecutive quarter of positive
comparable sales in the second quarter, and we continued to outperform
the industry. Our strategy is to leverage the strength of our brand to
drive sales at full margins. We can accomplish this because our concept
is highly differentiated, relevant to consumer tastes and preferences,
and we execute very well on food and service,” said David Overton,
Chairman and Chief Executive Officer. “We increased our operating
margins, as we make ongoing progress toward recapturing our peak margin
levels. Our improvement in profitability was accomplished while
maintaining excellent guest satisfaction scores, delivering the high
quality, consistent dining experience that we are known for,” continued
Overton.
Development
The Company continues to expect to open as many as eight to ten new
restaurants in fiscal 2013, of which one new restaurant opened in the
second quarter in Knoxville, Tennessee.
Internationally, the Company now expects one new The Cheesecake Factory
restaurant to open in the Middle East during fiscal 2013 under a
licensing agreement.
Capital Allocation
The Company also announced today that its Board of Directors approved an
increase in its quarterly dividend equating to 17%. The Company’s Board
of Directors declared a quarterly cash dividend of $0.14 per share on
the Company’s common stock. The dividend is payable on August 20, 2013
to shareholders of record at the close of business on August 7, 2013.
During the second quarter of fiscal 2013, the Company repurchased 87
thousand shares of its common stock at a cost of $3.3 million.
Year-to-date, the Company repurchased 1.3 million shares of its common
stock at a cost of $45.3 million.
The Company now expects to allocate as much as $125 million toward share
repurchases in the second half of fiscal 2013. In addition, the
Company’s Board of Directors increased its share repurchase
authorization by 7.5 million shares to 48.5 million shares.
“With industry-leading average restaurant volumes above $10 million per
year, our restaurants generate a substantial amount of cash. The
increase in our quarterly dividend and significant amount of planned
share repurchases over the next six months reflect our commitment to
effectively utilize our capital to increase shareholder value,”
concluded Overton.
Conference Call and Webcast
A conference call to review the Company’s results for the second quarter
of fiscal 2013 will be held today at 2:15 p.m. Pacific Time. The
conference call will be broadcast live over the Internet and a replay
will be available shortly after the call and continue through August 24,
2013. To listen to the conference call, please go to the Company’s
website at www.thecheesecakefactory.com
at least 15 minutes prior to the start of the call to register and
download any necessary audio software. Click on the “Investors” link on
the home page and select the conference call link at the top of the page.
About The Cheesecake Factory Incorporated
The Cheesecake Factory Incorporated created the upscale casual dining
segment in 1978 with the introduction of its namesake concept. The
Company operates 175 full-service, casual dining restaurants throughout
the U.S., including 163 restaurants under The Cheesecake Factory® mark;
11 restaurants under the Grand Lux Cafe® mark; and one restaurant under
the RockSugar Pan Asian Kitchen® mark. Internationally, three The
Cheesecake Factory® restaurants operate under a licensing agreement. The
Company also operates two bakery production facilities in Calabasas
Hills, CA and Rocky Mount, NC that produce over 70 varieties of quality
cheesecakes and other baked products. To learn more about the Company,
visit www.thecheesecakefactory.com.
Safe Harbor Statement
This press release contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995. These
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, including uncertainties related to: the Company’s ability to
deliver comparable sales increases and leverage those sales increases;
the Company’s ability to outperform the casual dining industry; the
Company’s ability to increase sales at full margins; the Company’s
ability to maintain its relevance to consumers; the Company’s ability to
deliver operating margin and earnings per share growth; the Company’s
ability to increase its guest satisfaction scores; the Company’s ability
to continue to expand domestically and internationally; the Company’s
ability to increase shareholder value through dividends and share
repurchases; factors outside of the Company’s control that impact
consumer confidence and spending; current and future macro national and
regional economic and credit market conditions; changes in national and
regional unemployment rates; the economic health of the Company’s
landlords and other tenants in retail centers in which its restaurants
are located; the economic health of suppliers, vendors and other third
parties providing goods or services to the Company; 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; and other risks and uncertainties detailed from
time to time in the Company’s filings with the Securities and Exchange
Commission (“SEC”), as set forth below. Investors are cautioned that
forward-looking statements are not guarantees of future performance and
that undue reliance should not be placed on such statements.
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 securities laws.
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.
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|
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The Cheesecake Factory Incorporated and Subsidiaries
|
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Consolidated Financial Statements
|
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(unaudited; in thousands, except per share and statistical data)
|
|
|
|
|
|
|
|
|
13 Weeks Ended
|
|
13 Weeks Ended
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26 Weeks Ended
|
|
26 Weeks Ended
|
|
Consolidated Statements of Operations
|
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July 2, 2013
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|
July 3, 2012
|
|
July 2, 2013
|
|
July 3, 2012
|
|
|
|
|
Amounts
|
|
Percent of Revenue
|
|
Amounts
|
|
Percent of Revenue
|
|
Amounts
|
|
Percent of Revenue
|
|
Amounts
|
|
Percent of Revenue
|
|
Revenues
|
|
$ 470,118
|
|
|
100.0
|
%
|
|
$
|
454,749
|
|
|
|
100.0
|
%
|
|
$
|
933,136
|
|
|
100.0
|
%
|
|
$
|
890,503
|
|
|
100.0
|
%
|
|
Costs and expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of sales
|
|
112,947
|
|
|
24.0
|
%
|
|
|
111,019
|
|
|
|
24.4
|
%
|
|
|
227,240
|
|
|
24.3
|
%
|
|
|
218,617
|
|
|
24.5
|
%
|
|
Labor expenses
|
|
|
151,162
|
|
|
32.2
|
%
|
|
|
146,086
|
|
|
|
32.1
|
%
|
|
|
302,145
|
|
|
32.4
|
%
|
|
|
289,066
|
|
|
32.5
|
%
|
|
Other operating costs and expenses
|
|
113,805
|
|
|
24.2
|
%
|
|
|
108,870
|
|
|
|
23.9
|
%
|
|
|
224,783
|
|
|
24.1
|
%
|
|
|
214,758
|
|
|
24.1
|
%
|
|
General and administrative expenses
|
|
27,811
|
|
|
5.9
|
%
|
|
|
26,278
|
|
|
|
5.8
|
%
|
|
|
56,600
|
|
|
6.1
|
%
|
|
|
54,943
|
|
|
6.2
|
%
|
|
Depreciation and amortization expenses
|
|
19,215
|
|
|
4.1
|
%
|
|
|
18,509
|
|
|
|
4.1
|
%
|
|
|
38,445
|
|
|
4.1
|
%
|
|
|
36,807
|
|
|
4.1
|
%
|
|
Impairment of assets and lease terminations
|
|
1,505
|
|
|
0.3
|
%
|
|
|
-
|
|
|
|
0.0
|
%
|
|
|
2,149
|
|
|
0.2
|
%
|
|
|
-
|
|
|
0.0
|
%
|
|
Preopening costs
|
|
2,503
|
|
|
0.5
|
%
|
|
|
3,017
|
|
|
|
0.7
|
%
|
|
|
3,817
|
|
|
0.4
|
%
|
|
|
5,123
|
|
|
0.6
|
%
|
|
Total costs and expenses
|
|
428,948
|
|
|
91.2
|
%
|
|
|
413,779
|
|
|
|
91.0
|
%
|
|
|
855,179
|
|
|
91.6
|
%
|
|
|
819,314
|
|
|
92.0
|
%
|
|
Income from operations
|
|
41,170
|
|
|
8.8
|
%
|
|
|
40,970
|
|
|
|
9.0
|
%
|
|
|
77,957
|
|
|
8.4
|
%
|
|
|
71,189
|
|
|
8.0
|
%
|
|
Interest and other (expense)/income, net
|
|
(1,271
|
)
|
|
(0.3
|
)%
|
|
|
(838
|
)
|
|
|
(0.2
|
)%
|
|
|
(2,581
|
)
|
|
(0.3
|
)%
|
|
|
(1,986
|
)
|
|
(0.2
|
)%
|
|
Income before income taxes
|
|
39,899
|
|
|
8.5
|
%
|
|
|
40,132
|
|
|
|
8.8
|
%
|
|
|
75,376
|
|
|
8.1
|
%
|
|
|
69,203
|
|
|
7.8
|
%
|
|
Income tax provision
|
|
11,316
|
|
|
2.4
|
%
|
|
|
11,733
|
|
|
|
2.6
|
%
|
|
|
21,501
|
|
|
2.3
|
%
|
|
|
20,082
|
|
|
2.3
|
%
|
|
Net income
|
|
|
$ 28,583
|
|
|
6.1
|
%
|
|
$
|
28,399
|
|
|
|
6.2
|
%
|
|
$
|
53,875
|
|
|
5.8
|
%
|
|
$
|
49,121
|
|
|
5.5
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic net income per share
|
|
$ 0.54
|
|
|
|
|
$
|
0.53
|
|
|
|
|
$
|
1.02
|
|
|
|
|
$
|
0.92
|
|
|
|
|
Basic weighted average shares outstanding
|
|
52,892
|
|
|
|
|
|
53,155
|
|
|
|
|
|
52,574
|
|
|
|
|
|
53,417
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted net income per share
|
|
$ 0.52
|
|
|
|
|
$
|
0.52
|
|
|
|
|
$
|
0.99
|
|
|
|
|
$
|
0.89
|
|
|
|
|
Diluted weighted average shares outstanding
|
|
55,073
|
|
|
|
|
|
55,091
|
|
|
|
|
|
54,692
|
|
|
|
|
|
55,376
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selected Segment Information
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The Cheesecake Factory restaurants
|
|
|
$ 424,845
|
|
|
|
|
$
|
408,933
|
|
|
|
|
$
|
837,396
|
|
|
|
|
$
|
799,680
|
|
|
|
|
Other
|
|
45,273
|
|
|
|
|
|
45,816
|
|
|
|
|
|
95,740
|
|
|
|
|
|
90,823
|
|
|
|
|
|
|
|
$ 470,118
|
|
|
|
|
$
|
454,749
|
|
|
|
|
$
|
933,136
|
|
|
|
|
$
|
890,503
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from operations:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The Cheesecake Factory restaurants
|
|
|
$ 62,718
|
|
|
|
|
$
|
64,820
|
|
|
|
|
$
|
121,955
|
|
|
|
|
$
|
118,631
|
|
|
|
|
Other
|
|
|
5,106
|
|
|
|
|
|
3,218
|
|
|
|
|
|
9,606
|
|
|
|
|
|
6,729
|
|
|
|
|
Corporate
|
|
|
(26,654
|
)
|
|
|
|
|
(27,068
|
)
|
|
|
|
|
(53,604
|
)
|
|
|
|
|
(54,171
|
)
|
|
|
|
|
|
|
$ 41,170
|
|
|
|
|
$
|
40,970
|
|
|
|
|
$
|
77,957
|
|
|
|
|
$
|
71,189
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selected Consolidated Balance Sheet Information
|
|
July 2, 2013
|
|
January 1, 2013
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
|
$ 130,623
|
|
|
|
|
$
|
83,569
|
|
|
|
|
|
|
|
|
|
|
Total assets
|
|
|
|
1,124,887
|
|
|
|
|
|
1,092,167
|
|
|
|
|
|
|
|
|
|
|
Total liabilities
|
|
|
490,591
|
|
|
|
|
|
512,441
|
|
|
|
|
|
|
|
|
|
|
Stockholders' equity
|
|
|
634,296
|
|
|
|
|
|
579,726
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
13 Weeks Ended
|
|
13 Weeks Ended
|
|
26 Weeks Ended
|
|
26 Weeks Ended
|
|
Supplemental Information
|
|
July 2, 2013
|
|
July 3, 2012
|
|
July 2, 2013
|
|
July 3, 2012
|
|
Comparable restaurant sales percentage change
|
|
|
|
0.8
|
%
|
|
|
|
|
1.7
|
%
|
|
|
|
1.1
|
%
|
|
|
|
2.0
|
%
|
|
Restaurants opened during period
|
|
|
|
1
|
|
|
|
|
|
1
|
|
|
|
|
1
|
|
|
|
|
2
|
|
|
Restaurants open at period-end
|
|
|
|
175
|
|
|
|
|
|
172
|
|
|
|
|
175
|
|
|
|
|
172
|
|
|
Restaurant operating weeks
|
|
|
|
2,263
|
|
|
|
|
|
2,225
|
|
|
|
|
4,554
|
|
|
|
|
4,437
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Non-GAAP Results to GAAP Results
In addition to the results provided in accordance with Generally
Accepted Accounting Principles ("GAAP") in this press release, the
Company is providing non-GAAP measurements which present the second
quarter and year-to-date fiscal 2013 and fiscal 2012 net income and
diluted net income per share excluding the impact from certain items.
Additional detail regarding the second quarter fiscal 2013 item can be
found on the first page of this press release.
The non-GAAP measurements are intended to supplement the presentation of
the Company’s financial results in accordance with GAAP. The Company
believes that the presentation of these items provides additional
information to facilitate the comparison of past and present financial
results.
|
|
|
|
|
|
|
|
|
|
|
|
|
13 Weeks Ended
|
|
13 Weeks Ended
|
|
26 Weeks Ended
|
|
26 Weeks Ended
|
|
|
|
July 2, 2013
|
|
July 3, 2012
|
|
July 2, 2013
|
|
July 3, 2012
|
|
|
|
(unaudited; in thousands, except per share data)
|
|
Net income (GAAP)
|
|
$
|
28,583
|
|
$
|
28,399
|
|
|
$
|
53,875
|
|
$
|
49,121
|
|
|
After-tax impact from:
|
|
|
|
|
|
|
|
|
|
- Impairment of assets and lease terminations (1)
|
|
|
903
|
|
|
-
|
|
|
|
1,289
|
|
|
-
|
|
|
- Proceeds from variable life insurance contract (2)
|
|
|
-
|
|
|
(419
|
)
|
|
|
-
|
|
|
(419
|
)
|
|
Net income (non-GAAP)
|
|
$
|
29,486
|
|
$
|
27,980
|
|
|
$
|
55,164
|
|
$
|
48,702
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted net income per share (GAAP)
|
|
$
|
0.52
|
|
$
|
0.52
|
|
|
$
|
0.99
|
|
$
|
0.89
|
|
|
After-tax impact from:
|
|
|
|
|
|
|
|
|
|
- Impairment of assets and lease terminations (1)
|
|
|
0.02
|
|
|
-
|
|
|
|
0.02
|
|
|
-
|
|
|
- Proceeds from variable life insurance contract (2)
|
|
|
-
|
|
|
(0.01
|
)
|
|
|
-
|
|
|
(0.01
|
)
|
|
Diluted net income per share (non-GAAP)
|
|
$
|
0.54
|
|
$
|
0.51
|
|
|
$
|
1.01
|
|
$
|
0.88
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) The pre-tax amounts associated with this item were $1,505 in the
second quarter of fiscal 2013 and $644 in the first quarter of fiscal
2013, and were recorded in impairment of assets and lease terminations.
(2) This item was non-taxable and was recorded in interest and other
(expense)/income, net.
Source: The Cheesecake Factory Incorporated
The Cheesecake Factory Incorporated
Jill Peters, (818) 871-3000
investorrelations@thecheesecakefactory.com