Increases Quarterly Dividend by 20%; Expands
Share Repurchase Authorization
The Cheesecake Factory Incorporated (NASDAQ: CAKE) today
reported financial results for the second quarter of fiscal 2016,
which ended on June 28, 2016.
Total revenues were $558.9 million in the second quarter of
fiscal 2016 as compared to $529.1 million in the second quarter of
fiscal 2015. Net income and diluted net income per share were $38.6
million and $0.78, respectively, in the second quarter of fiscal
2016.
Comparable restaurant sales at The Cheesecake Factory
restaurants increased 0.3% in the second quarter of fiscal
2016.
“We again outperformed the casual dining industry, delivering
our 26th consecutive quarter of positive comparable sales,” said
David Overton, Chairman and Chief Executive Officer. “Capturing
operational efficiencies, coupled with a benign commodity cost
environment, enabled us to offset industry wage inflation and drive
strong margins and earnings growth during the quarter. In addition,
we achieved a significant milestone in our international expansion
with the opening of the first The Cheesecake Factory restaurant in
China, at Disneytown in the Shanghai Disney Resort, under a
licensing agreement.”
Overton concluded, “Underscoring our confidence in our
industry-leading position and future prospects, we are both
expanding our share repurchase authorization and meaningfully
increasing our quarterly dividend. We will have doubled the amount
of our dividend since first initiating one in fiscal 2012, with
this increase. We remain committed to investing in returns-focused
growth and returning capital to achieve our targeted returns and
increase shareholder value.”
Development
The Company continues to expect to open as many as eight
Company-owned restaurants domestically in fiscal 2016, the second
of which opened in Greenville, South Carolina in the second
quarter.
Internationally, the Company continues to expect as many as four
to five restaurants to open under licensing agreements in fiscal
2016, including the first The Cheesecake Factory restaurant that
opened in China in June 2016.
Capital Allocation
The Company’s Board of Directors declared a quarterly cash
dividend of $0.24 per share on the Company’s common stock,
representing a 20% increase. The dividend is payable on August 23,
2016 to shareholders of record at the close of business on August
10, 2016.
During the second quarter of fiscal 2016, the Company
repurchased 0.5 million shares of its common stock at a cost of
$26.6 million. Year-to-date, the Company repurchased 1.6 million
shares of its common stock at a cost of $76.6 million. In addition,
the Company’s Board of Directors increased its share repurchase
authorization by 7.5 million shares to 56.0 million shares. The
Company continues to expect that it will return its free cash flow
to shareholders in fiscal 2016 in the form of dividends and share
repurchases.
Conference Call and Webcast
The Company will hold a conference call to review its results
for the second quarter of fiscal 2016 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 August 27, 2016.
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, through its subsidiaries, owns and operates
202 full-service, casual dining restaurants throughout the U.S.A.
and Puerto Rico, including 189 restaurants under The Cheesecake
Factory® mark; 12 restaurants under the Grand Lux Cafe® mark; and
one restaurant under the RockSugar Pan Asian Kitchen® mark.
Internationally, 12 The Cheesecake Factory® restaurants operate
under licensing agreements. The Company’s bakery division operates
two bakery production facilities, in Calabasas Hills, CA and Rocky
Mount, NC, that produce quality cheesecakes and other baked
products for its restaurants, international licensees and
third-party bakery customers. In 2016, the Company was named to the
FORTUNE Magazine “100 Best Companies to Work For®” list for the
third consecutive year. To learn more about the Company, visit
www.thecheesecakefactory.com.
FORTUNE and 100 Best Companies to Work For® are registered
trademarks of Time Inc. and are used under license. From FORTUNE
Magazine, March 3, 2016 ©2016 Time Inc. FORTUNE and Time Inc. 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. 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
consistent and dependable comparable sales results over a sustained
period of time; the Company’s ability to deliver increases in guest
traffic; the strength of the Company’s brand; the Company’s ability
to provide a differentiated experience to guests; the Company’s
ability to outperform the casual dining industry and increase its
market share; the Company’s ability to leverage sales increases and
manage flow through; the Company’s ability to increase margins; the
Company’s ability to grow earnings; the Company’s ability to remain
relevant to consumers; the Company’s ability to increase
shareholder value; the Company’s ability to expand its concepts
domestically and work with its licensees to expand its concept
internationally; the Company’s ability to utilize its capital
effectively and continue to repurchase its shares; factors outside
of the Company’s control that impact consumer confidence and
spending; current and future macroeconomic conditions; acceptance
and success of The Cheesecake Factory in international markets;
changes in 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,
licensees, 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”). 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.
The Cheesecake Factory Incorporated and Subsidiaries
Condensed Consolidated Financial Statements (unaudited;
in thousands, except per share and statistical data)
13 Weeks Ended 13 Weeks Ended 26 Weeks
Ended 26 Weeks Ended Consolidated Statement of
Operations June 28, 2016 June 30, 2015 June
28, 2016 June 30, 2015 Amount Percent of
Revenues
Amount Percent of
Revenues
Amount Percent of
Revenues
Amount Percent of
Revenues
Revenues $
558,862 100.0 % $ 529,107 100.0 % $ 1,112,555 100.0 % $ 1,047,080
100.0 % Costs and expenses: Cost of sales 126,933 22.7 % 126,623
23.9 % 257,706 23.2 % 253,235 24.2 % Labor expenses 185,211 33.2 %
168,495 31.8 % 370,869 33.3 % 339,664 32.5 % Other operating costs
and expenses 131,980 23.6 % 123,675 23.4 % 261,537 23.5 % 247,110
23.6 % General and administrative expenses 35,785 6.4 % 35,345 6.7
% 71,122 6.4 % 68,420 6.5 % Depreciation and amortization expenses
21,461 3.8 % 21,158 4.0 % 42,925 3.9 % 42,335 4.0 % Preopening
costs 2,302 0.4 % 4,058
0.8 % 4,612 0.4 % 5,509 0.5 % Total
costs and expenses 503,672 90.1 %
479,354 90.6 % 1,008,771 90.7 %
956,273 91.3 % Income from operations 55,190 9.9 % 49,753
9.4 % 103,784 9.3 % 90,807 8.7 % Interest and other
(expense)/income, net (2,181 ) (0.4 )% (1,432
) (0.3 )% (4,485 ) (0.4 )% (3,327 ) (0.3 )%
Income before income taxes 53,009 9.5 % 48,321 9.1 % 99,299 8.9 %
87,480 8.4 % Income tax provision 14,424 2.6 %
13,597 2.5 % 26,760 2.4 %
24,333 2.4 % Net income $ 38,585 6.9 % $
34,724 6.6 % $ 72,539 6.5 % $ 63,147
6.0 % Basic net income per share $ 0.80 $ 0.72
$ 1.50 $ 1.29 Basic weighted average shares
outstanding 48,232 48,451 48,375
48,838 Diluted net income per share $
0.78 $ 0.69 $ 1.46 $ 1.25 Diluted
weighted average shares outstanding 49,598
50,262 49,814 50,681
Selected Segment Information Revenues: The Cheesecake
Factory restaurants $ 511,918 $ 483,285 $ 1,018,234 $ 956,102 Other
46,944 45,822 94,321
90,978 $ 558,862 $ 529,107 $ 1,112,555
$ 1,047,080 Income from operations: The
Cheesecake Factory restaurants $ 82,285 $ 77,292 $ 156,577 $
143,993 Other 5,769 5,263 12,681 11,326 Corporate (32,864 )
(32,802 ) (65,474 ) (64,512 ) $ 55,190
$ 49,753 $ 103,784 $ 90,807
Selected Consolidated Balance Sheet Information
June 28, 2016
December 29, 2015
Cash and cash equivalents $ 79,618 $ 43,854 Total assets 1,204,318
1,233,346 Total liabilities 607,476 644,807 Stockholders' equity
596,842 588,539
13 Weeks Ended
13 Weeks Ended
26 Weeks Ended
26 Weeks Ended
The Cheesecake Factory Supplemental Information
June 28, 2016
June 30, 2015
June 28, 2016
June 30, 2015
Comparable restaurant sales 0.3 % 2.8 % 1.0 % 3.5 % Restaurants
opened during period 1 2 2 2 Restaurants open at period-end 189 179
189 179 Restaurant operating weeks 2,448 2,309 4,884 4,610
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version on businesswire.com: http://www.businesswire.com/news/home/20160727006196/en/
The Cheesecake Factory IncorporatedStacy Feit(818)
871-3000investorrelations@thecheesecakefactory.com
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