BJ�s Restaurants, Inc. (NASDAQ: BJRI) today reported financial
results for the fourth quarter and fiscal year 2008 that ended on
Tuesday, December 30, 2008.
Compared to the same quarter of the prior year, total revenues
for the fourth quarter of fiscal 2008 increased approximately 16.5%
to $99.3 million. Comparable restaurant sales decreased by 0.7%
during the fourth quarter compared to an increase of 4.9% for the
same quarter last year. Net income and diluted net income per share
for the fourth quarter were $2.3 million and $0.08, respectively.
As previously announced in our press release on January 8, 2009,
fourth quarter results include $2.1 million of pre-tax charges
related to accrued compensation and related benefits from the
December 2008 departure of the Company�s two co-founders and
estimated costs to settle two California employment practices
lawsuits that have been outstanding since 2004 and 2005. The
Company also incurred a pre-tax charge of approximately $0.5
million related to asset disposals in connection with selected
restaurant facility image enhancements and upgrades. As a result of
these aforementioned charges, the Company realized a net tax
benefit in the fourth quarter of $0.4 million, or $0.01 of diluted
net income per share. On a non-GAAP basis, excluding the $2.6
million of pre-tax charges and their related tax effect, the
Company estimates its annual effective tax rate would have been
24.6%, resulting in non-GAAP net income and non-GAAP net income per
diluted share of $3.4 million and $0.13, respectively. A
reconciliation between GAAP and non-GAAP financial measures is
included in the accompanying financial data.
Compared to fiscal 2007, total revenues for fiscal 2008
increased approximately 18.3% to $374.1 million. Comparable
restaurant sales decreased only 0.3% during the fiscal year. Net
income and diluted net income per share for fiscal 2008 were $10.3
million and $0.39, respectively. In addition to the $2.6 million of
fourth quarter pretax charges noted above, there were other pre-tax
charges totaling approximately $0.8 million related to hurricane
losses and asset disposals recorded in earlier quarters during
fiscal 2008. These charges resulted in reducing the Company�s
effective tax rate for fiscal 2008 to approximately 21.0%. On a
non-GAAP basis, excluding the $3.4 million of pre-tax charges and
their related tax effect, the Company estimates its effective tax
rate would have been 24.6%, resulting in non-GAAP net income and
non-GAAP net income per diluted share of $12.4 million and $0.47,
respectively. A reconciliation between GAAP and non-GAAP financial
measures is included in the accompanying financial data.
�We were pleased with our overall financial performance during
the fourth quarter and full year of 2008 in light of the
unprecedented volatility of the overall operating environment for
most consumer businesses,� commented Jerry Deitchle, Chairman and
CEO. �We are particularly proud of our comparable sales performance
when compared to most of our casual dining peers. Our comparable
restaurant sales decreased by only 0.7% during the fourth quarter,
compared to an estimated decrease of approximately 6.3% in the
Knapp-Track� benchmark for casual dining comparable restaurant
sales for the quarter. The entire BJ�s team has worked very hard to
successfully implement and execute several sales-building
initiatives during the fourth quarter and full year of 2008 that
principally involved the introduction of new products and services
for our guests. We expect that 2009 will be another difficult year
for the casual dining segment in terms of overall guest traffic.
Accordingly, we have additional sales-building initiatives planned
for 2009 implementation. We also believe that BJ�s continues to
benefit from its �casual-plus� competitive positioning combined
with its �mass market casual dining� average guest check in the $12
range. We intend to continue playing to the strengths of our
competitive positioning as we move forward with the execution of
our national expansion plan, with the goal to continue building our
market share in the estimated $90 billion casual dining segment
over time.�
The Company opened three new restaurants during the fourth
quarter of 2008 (Tacoma, WA; Newark, CA; and Chula Vista, CA). As
previously announced, the Company currently expects to open 9 to 11
new restaurants during 2009. Two new restaurants are currently
planned for first quarter openings (Henderson, NV and Gainesville,
FL). As of this date, there are no new openings planned for the
second quarter; as many as four to five new restaurants planned for
the third quarter; and as many as three to four new restaurants
planned for the fourth quarter. Coupled with the carryover impact
of our partial-year 2008 new restaurant openings, the Company�s
total restaurant operating weeks during 2009 are currently expected
to increase approximately 15% to 16%. The actual number and timing
of new restaurant openings is subject to a number of factors
outside of the Company�s control, including weather conditions and
factors under the control of landlords, contractors and
regulatory/licensing authorities, as well as credit market
conditions and the availability of capital to finance our
expansion. �We are continuing to focus our new restaurant
development in AAA-quality locations in mature, densely populated
trade areas with solid co-tenancies in the retail projects that we
select,� said Deitchle. �We are fortunate that BJ�s has become a
preferred tenant with many of the major retail project developers
and operators in the country, thus increasing the overall number
and quality of potential locations available for our new restaurant
development over the longer run.�
Investor Conference Call and Webcast
BJ�s Restaurants, Inc. will conduct a conference call on its
fourth quarter earnings release today, February 12, 2009, at 5:00
p.m. (Eastern Time). The Company will provide an Internet simulcast
of the conference call. To listen to the conference call, please
visit the �Investors� page of the Company's website located at
http://www.bjsrestaurants.com several minutes prior to the start of
the call to register and download any necessary audio software. An
archive of the presentation will be available for 30 days following
the call.
BJ's Restaurants, Inc. currently owns and operates 82 casual
dining restaurants under the BJ's Restaurant & Brewery, BJ's
Restaurant & Brewhouse or BJ's Pizza & Grill brand names.
BJ's restaurants offer an innovative and broad menu featuring
award-winning, signature deep-dish pizza complemented with
generously portioned salads, appetizers, sandwiches, soups, pastas,
entr�es and desserts. Quality, flavor, value, moderate prices and
sincere service remain distinct attributes of the BJ's experience.
The Company operates several microbreweries which produce and
distribute BJ's critically acclaimed handcrafted beers throughout
the chain. The Company's restaurants are located in California
(44), Texas (13), Arizona (5), Colorado (3), Oregon (2), Nevada
(2), Florida (4), Ohio (2), Oklahoma (2), Kentucky (1), Indiana
(1), Louisiana (1) and Washington (2). The Company also has a
licensing interest in a BJ's restaurant in Lahaina, Maui. Visit
BJ's Restaurants, Inc. on the Web at
http://www.bjsrestaurants.com.
Certain statements in the preceding paragraphs and all other
statements that are not purely historical constitute
"forward-looking statements" for purposes of the Securities Act of
1933 and the Securities and Exchange Act of 1934, as amended, and
are intended to be covered by the safe harbors created thereby.
Such statements include, but are not limited to, those regarding
expected comparable restaurant sales growth in future periods,
those regarding the effect of new sales-building initiatives, as
well as those regarding the number of restaurants expected to be
opened in future periods and the timing and location of such
openings. These �forward-looking� statements involve known and
unknown risks, uncertainties and other factors which may cause
actual results to be materially different from those projected or
anticipated. Factors that might cause such differences include, but
are not limited to: (i) the effect of recent credit and equity
market disruptions on our ability to finance our continued
expansion on acceptable terms, (ii) our ability to manage an
increasing number of new restaurant openings, (iii) construction
delays, (iv) labor shortages, (v) minimum wage increases, (vi) food
quality and health concerns, (vii) factors that impact California,
where 44 of our current 82 restaurants are located, (viii)
restaurant and brewery industry competition, (ix) impact of certain
brewery business considerations, including without limitation,
dependence upon suppliers and related hazards, (x) consumer
spending trends in general for casual dining occasions, (xi)
potential uninsured losses and liabilities, (xii) fluctuating
commodity costs and availability of food in general and certain raw
materials related to the brewing of our handcrafted beers and
energy, (xiii) trademark and servicemark risks, (xiv) government
regulations, (xv) licensing costs, (xvi) beer and liquor
regulations, (xvii) loss of key personnel, (xviii) inability to
secure acceptable sites, (xix) limitations on insurance coverage,
(xx) legal proceedings, (xxi) other general economic and regulatory
conditions and requirements, (xxii) the success of our key
sales-building and related operational initiatives and (xxiii)
numerous other matters discussed in the Company's filings with the
Securities and Exchange Commission. BJ's Restaurants, Inc.
undertakes no obligation to update or alter its �forward-looking�
statements whether as a result of new information, future events or
otherwise.
Further information concerning the Company�s results of
operations for the fourth quarter 2008 will be provided in the
Company�s Form 10-K filing, to be filed with the Securities and
Exchange Commission by March 14, 2009.
�
BJ�s Restaurants, Inc. Unaudited Consolidated
Statements of Income (Dollars in thousands except for per
share data) � �
Thirteen Weeks Ended �
Fifty-Two
Weeks Ended December 30, �
January 1, December
30, �
January 1, 2008 2008 2008
2008 � � � � Revenues $ 99,276 100.0 % $ 85,199 100.0 % $
374,076 100.0 % $ 316,095 100.0 % Costs and expenses: Cost of sales
25,191 25.4 21,508 25.2 94,412 25.2 80,374 25.4 Labor and benefits
34,707 35.0 29,631 34.8 131,328 35.1 111,031 35.1 Occupancy and
operating 21,473 21.6 17,016 20.0 80,212 21.4 61,906 19.6 General
and administrative 7,187 7.2 6,645 7.8 27,264 7.3 26,008 8.2
Depreciation and amortization 5,440 5.5 4,084 4.8 19,184 5.1 14,421
4.6 Restaurant opening 1,369 1.4 1,762 2.1 7,384 2.0 6,940 2.2 Loss
on disposal of assets 504 0.5 � � 855 0.2 2,004 0.6 Natural
disaster and related � � � � 446 0.1 � � Legal settlements and
terminations � 2,086 � 2.1 � � � � � � 2,086 0.6 � � � � � Total
costs and expenses � 97,957 � 98.7 � � 80,646 94.7 � � 363,171 97.0
� � 302,684 95.7 � Income from operations 1,319 1.3 4,553 5.3
10,905 3.0 13,411 4.3 � Other income: Interest income, net 454 0.5
702 0.8 1,764 0.5 3,306 1.0 Other income, net � 96 � 0.1 � � 111
0.1 � � 376 0.1 � � 482 0.2 � Total other income � 550 � 0.6 � �
813 0.9 � � 2,140 0.6 � � 3,788 1.2 � Income before income taxes
1,869 1.9 5,366 6.2 13,045 3.6 17,199 5.5 � Income tax (benefit)
expense � (386 ) (0.4 ) � 1,674 2.0 � � 2,737 0.7 � � 5,494 1.7 � �
Net income $ 2,255 � 2.3 % $ 3,692 4.2 % $ 10,308 2.9 % $ 11,705
3.8 % � Net income per share: Basic $ 0.08 � $ 0.14 $ 0.39 $ 0.45 �
Diluted $ 0.08 � $ 0.14 $ 0.39 $ 0.44 � Weighted average number of
shares outstanding: Basic � 26,718 � � 26,344 � 26,484 � 26,187 �
Diluted � 26,816 � � 26,902 � 26,749 � 26,880 � �
Selected
Consolidated Balance Sheet Information (Dollars in
thousands) � �
Balance Sheet Data (end of
period):
December 30,2008
January 1,2008
� Cash and cash equivalents $ 8,852 $ 11,617 � Investments (1) $
30,617 $ 41,100 � Total assets $ 335,209 $ 285,299 � Total
long-term debt, including current portion $ 9,500 $ � �
Shareholders� equity $ 232,277 $ 220,523 �
(1) Investments are comprised of auction rate securities
classified as available for sale, included in non-current assets
and recorded at their fair value as of December 30, 2008. As
disclosed in previous periodic reports, due to significant
disruptions in the market for auction rate securities, the Company
may be required to make adjustments in the reported fair value of
these instruments in future quarterly periods.
�
Supplemental Information (Dollars in thousands) � �
Thirteen Weeks Ended Fifty-Two Weeks Ended
December 30, �
January 1, December 30, �
January 1, 2008 2008 2008 2008
Stock based compensation (2) � � � � Labor and benefits $
243 0.2 % $ 208 0.2 % $ 849 0.2 % $ 719 0.2 % General and
administrative � 634 � 0.6 � � 572 � 0.7 � � 2,495 � 0.7 � � 2,228
� 0.7 � Total stock based compensation $ 877 � 0.8 % $ 780 � 0.9 %
$ 3,344 � 0.9 % $ 2,947 � 0.9 % �
Unaudited Operating Data
(3) Comparable restaurant sales % change -0.7 % 4.9 % -0.3 %
6.2 % Restaurants opened during period 3 4 15 13 Restaurants open
at period-end 82 68 82 68 Restaurant operating weeks 1,052 873
3,857 3,172 �
(2) Percentages represent percent of total revenues.
(3) Excludes the one licensed restaurant.
Reconciliation of Non-GAAP Financial Measures
To supplement the consolidated financial statements presented in
accordance with U.S. generally accepted accounting principles
(GAAP), the Company has included the following non-GAAP financial
measures in this press release or in the webcast to discuss the
Company's financial results for the fourth quarter and fiscal year
which may be accessed via the Company's website at
http://www.bjsrestaurants.com: (i) non-GAAP net income and (ii)
non-GAAP basic and diluted net income per share. Each of these
non-GAAP financial measures is adjusted from results based on GAAP
to exclude certain expenses and gains. As a general matter, the
Company uses these non-GAAP measures in addition to and in
conjunction with results presented in accordance with GAAP. Among
other things, the Company uses such non-GAAP financial measures in
addition to and in conjunction with corresponding GAAP measures to
help analyze the performance of its core business. In addition, the
Company believes that such non-GAAP financial information is
provided by its competitors and such information is used by
analysts and others in the investment community to analyze the
Company's results and in formulating estimates of future
performance and that failure to report these non-GAAP measures,
could result in confusion among analysts and others and a misplaced
perception that the Company's results have underperformed or
exceeded expectations.
These non-GAAP financial measures reflect an additional way of
viewing aspects of the Company's operations that, when viewed with
the GAAP results and the reconciliations to corresponding GAAP
financial measures, provide a more complete understanding of the
Company's results of operations and the factors and trends
affecting the Company's business. However, these non-GAAP measures
should be considered as a supplement to, and not as a substitute
for, or superior to, the corresponding measures calculated in
accordance with GAAP.
Non-GAAP net income and non-GAAP basic and diluted net income
per share exclude the effects of (i) loss on disposal of certain
assets, (ii) natural disaster and related expense and (iii) legal
settlements and termination expenses. In addition, non-GAAP net
income and non-GAAP diluted net income per share reflect an
adjustment of income tax expense associated with exclusion of the
foregoing expense items and an estimated effective tax rate that
the Company would have incurred if they excluded these charges. The
adjustment of income taxes is required in order to provide
management and investors a more accurate assessment of the taxes
that would have been payable on net income, as adjusted by
exclusion of the effects of the above listed items. The Company
believes that presentation of measures of net income and diluted
net income per share that exclude these items assists management
and investors in evaluating the period over period performance of
the Company's ongoing core business operations because the expenses
are either non-cash or non-routine in nature. Furthermore, the
Company believes the exclusion of legal settlements and termination
expenses (settlement of two employment practice lawsuits and the
departure of the Company�s co-founders) and natural disaster and
related expenses (Hurricanes Gustav and Ike) is appropriate and
useful to investors in light of the fact that such expenses are, by
their nature, extraordinary and non-recurring. Finally, with the
respect to the exclusion of charges relating to the disposal of
certain assets, charges related to the natural disaster and related
expense and charges related to legal settlements and termination
expenses, the Company believes that presentation of a measure of
non-GAAP net income and net income per share that excludes such
charges is useful to management and investors in evaluating the
performance of the Company�s ongoing operations on a
period-to-period basis and relative to the Company�s
competitors.
The Company believes disclosure of non-GAAP net income and
non-GAAP basic and diluted net income per share has economic
substance because expenses associated with disposal of assets,
natural disasters and legal settlements and termination expenses
are infrequent in nature. In addition, the loss on disposal of
assets does not represent current cash expenditures. A material
limitation associated with the use of this measure as compared to
the GAAP measures of net income and diluted net income per share is
that they may not be comparable with the calculation of net income
and diluted net income per share for other companies in the
Company's industry. The Company compensates for these limitations
by providing full disclosure of the effects of this non-GAAP
measure, by presenting the corresponding GAAP financial measure in
this release and in the Company�s financial statements and by
providing a reconciliation to the corresponding GAAP measure to
enable investors to perform their own analysis.
� �
Reconciliation of Non-GAAP Financial Measures
(Unaudited, dollars in thousands except for per share data)
�
Thirteen Weeks Ended Fifty-Two Weeks Ended
December 30, �
January 1, December 30, �
January 1, 2008 2008 2008 2008 �
� � � Net income as reported $ 2,255 2.3 % $ 3,692 4.2 % $ 10,308
2.9 % $ 11,705 3.8 % Add income tax (benefit) expense as reported �
(386 ) (0.4 ) � 1,674 � 2.0 � � 2,737 � 0.7 � � 5,494 � 1.7 �
Income before income taxes as reported 1,869 1.9 5,366 6.2 13,045
3.6 17,199 5.5 Loss on disposal of assets 504 0.5 � � 855 0.2 2,004
0.6 Natural disaster and related � � � � 446 0.1 � � Legal
settlements and terminations 2,086 2.1 � � 2,086 0.6 � � Tax effect
- income before income taxes (1) (459 ) (0.5 ) (1,674 ) (2.0 )
(3,206 ) (0.9 ) (5,494 ) (1.7 ) Tax effect - loss on disposal of
assets (1) (124 ) (0.1 ) � � (210 ) (0.1 ) (640 ) (0.2 ) Tax effect
- natural disaster and related (1) � � � � (110 ) � � � Tax effect
- legal settlements and terminations (1) � (513 ) (0.5 ) � � � � �
� (513 ) (0.1 ) � � � � � Non-GAAP net income $ 3,363 � 3.4 % $
3,692 � 4.2 % $ 12,393 � 3.4 % $ 13,069 � 4.2 % � Basic net income
per share: $ 0.08 $ 0.14 $ 0.39 $ 0.45 Add income tax (benefit)
expense as reported � (0.01 ) � 0.06 � � 0.10 � � 0.21 � Basic net
income per share before income taxes as reported
0.07
0.20
0.49 0.66 Loss on disposal of assets 0.02 � 0.03 0.08 Natural
disaster and related � � 0.02 � Legal settlements and terminations
0.08 � 0.08 � Tax effect - income before income taxes (1) (0.02 )
(0.06 ) (0.12 ) (0.21 ) Tax effect - loss on disposal of assets (1)
� � (0.01 ) (0.02 ) Tax effect - natural disaster and related (1) �
� � � Tax effect - legal settlements and terminations (1) � (0.02 )
� � � � (0.02 ) � � � Non-GAAP basic net income per share $ 0.13 �
$ 0.14 � $ 0.47 � $ 0.51 � � Diluted net income per share: $ 0.08 $
0.14 $ 0.39 $ 0.44 Add income tax (benefit) expense as reported �
(0.01
)
�
0.06
� � 0.10 � � 0.20 � Basic net income per share before income taxes
as reported
0.07
0.20
0.49 0.64 Loss on disposal of assets 0.02 � 0.03 0.07 Natural
disaster and related � � 0.02 � Legal settlements and terminations
0.08 � 0.08 � Tax effect - income before income taxes (1) (0.02 )
(0.06 ) (0.12 ) (0.20 ) Tax effect - loss on disposal of assets (1)
� � (0.01 ) (0.02 ) Tax effect - natural disaster and related (1) �
� � � Tax effect - legal settlements and terminations (1) � (0.02 )
� � � � (0.02 ) � � � Non-GAAP diluted net income per share $ 0.13
� $ 0.14 � $ 0.47 � $ 0.49 �
(1) The Company�s tax rate for the thirteen and fifty-two weeks
ended December 30, 2008 was impacted by the charges listed in the
reconciliation schedule above. Excluding these charges the Company
estimates that its effective annual tax rate would have been 24.6%.
Accordingly for this reconciliation of non-GAAP related financial
matters the Company used the 24.6% effective tax rate for the
thirteen and fifty-two weeks ended December 30, 2008, as if these
charges did not occur.
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