Revenue Down Slightly at Cheesecake Factory
The Cheesecake Factory Incorporated today reported financial results for the third quarter of fiscal 2009, which ended on September 29, 2009.
-- Chain Leader, 10/23/2009 8:45:00 AM
PRESS RELEASE: CALABASAS HILLS, Calif.--(BUSINESS WIRE)--The Cheesecake Factory Incorporated (NASDAQ: CAKE) today reported financial results for the third quarter of fiscal 2009, which ended on September 29, 2009.
Total revenues were $400.6 million in the third quarter of fiscal 2009 as compared to $405.1 million in the prior year third quarter. Net income and diluted net income per share were $16.3 million and $0.27, respectively.
In the third quarter of fiscal 2009, the Company recorded an approximate $2.0 million pre-tax charge. The charge resulted from a payment to partially unwind an interest rate collar on a portion of the outstanding balance on the Company's revolving credit facility. This item reduced reported diluted net income per share by approximately $0.02. Excluding this item, net income was $17.5 million, an increase of 48.2% from the prior year third quarter, and diluted net income per share was $0.29, an increase of 52.6% from the prior year period.
Operating Results
Comparable restaurant sales decreased 2.8% in the third quarter of fiscal 2009 from the third quarter of the prior year. By concept, comparable restaurant sales decreased 2.4% and 6.0% at The Cheesecake Factory and Grand Lux Cafe, respectively, in the third quarter of fiscal 2009 from the third quarter of the prior year.
"We achieved significant year-over-year growth in net income and earnings per share in the third quarter, driven by a third consecutive quarter of moderate gains in comparable restaurant sales and solid execution on our cost management initiatives," said David Overton, Chairman and CEO.
"In the third quarter, we extended the progress that we made in the first half of the year across our key priorities. We realized over $8 million in cost savings this quarter, yet saw another step up in guest satisfaction scores, as guests continued to recognize our commitment to them. During our summer menu change, we rolled out an expanded Small Plates & Snacks menu, a Kid's menu and introduced one of the most successful new cheesecakes in our history. Quality, innovation, relevance and choice define our menu and guests are responding positively to this.
"Financial discipline is also a top priority and we further reduced our outstanding debt balance during the third quarter, which we believe will provide us with greater financial flexibility. In all, our team is doing a very good job of managing our business in a consistent way through the ongoing difficult economic environment and strongly positioning our Company for the future," concluded Overton.
Debt Repayment
During the third quarter of fiscal 2009, the Company reduced the balance on its revolving credit facility by $50 million and repaid an additional $25 million early in the fourth quarter of fiscal 2009. The current outstanding balance on the Company's revolving credit facility is $125 million.
Conference Call and Webcast
A conference call to review the Company's results for the third quarter of fiscal 2009 will be held today at 2:00 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 November 22, 2009. To listen to the conference call, please go to the Company's website at 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 146 restaurants throughout the U.S. under The Cheesecake Factory(r) name with an extensive menu of more than 200 items and fiscal 2008 average annual unit sales of approximately $9.8 million. Grand Lux Cafe(r), the Company's second concept, has 13 units in operation across the U.S. offering a broad menu of more than 150 items and average annual unit sales of approximately $10.6 million in fiscal 2008. The Company also operates RockSugar Pan Asian Kitchen(r), and two bakery production facilities in Calabasas Hills, CA and Rocky Mount, NC that produce over 70 varieties of quality cheesecakes and other baked products. For more information, please visit thecheesecakefactory.com.
Safe Harbor Statement
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding debt reduction and its expected impact on our future financial flexibility. 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: our ability to realize the expected benefits from lower debt levels; 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 our landlords and other tenants in shopping centers in which we 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 our 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 our 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 and which are available at www.sec.gov.
