BJRI BJs Restaurants Inc

BJ’s Restaurants, Inc. (BJRI) reported first quarter 2011 adjusted earnings of 25 cents per share, which surpassed the Zacks Consensus Estimate of 19 cents and increased 56% from 16 cents posted in the prior-year quarter. The earnings results were driven by strong comparable restaurant sales growth. 

1Q11 Results Highlights

Revenues in the reported quarter climbed 19% year over year to $144.9 million and were also above the Zacks Consensus Estimate of $141.0 million. The upside in revenues was helped by higher number of operating weeks (up 11%), compared with the year-ago quarter.

Based in Orange County, California, BJ’s sustained its top-line growth momentum in first quarter 2011 on the back of operating efficiencies, innovative offerings and expansion, which have helped the casual dining restaurant operator to drive traffic.

Comparable restaurant sales in the quarter witnessed a substantial growth of 7.8% compared with the jump of 4.4% in the prior-year quarter.

Operating margin climbed 230 basis points (bps) from the year-ago quarter to 7.0%, reflecting a 90-bp plunge in labor and benefits costs, 120-bp decline in occupancy and operating costs and 20-bp fall in general and administrative expenses.

Store Update

BJ’s opened 2 restaurants during the first quarter of 2011, thus adding to its existing portfolio of 104 restaurants.

BJ’s is one of the few casual dining chains, which has been expanding in a weak economy. For fiscal 2011, the company plans to open 12 to 13 restaurants compared with 10 restaurants in fiscal 2010. The company plans to launch 3 new restaurants in the second quarter, 4 in the third quarter and 3 to 4 in the last quarter of 2011.

Financial Position

BJ’s ended the year with cash and cash equivalents of $48.1 million and shareholders equity of $299.8 million. As of March 29, 2011, BJ’s long-term debt liability was nil.

Outlook

We believe that the company is well-positioned to sustain its growth momentum while generating improved earnings. Moreover, BJ’s offers investors one of the strongest growth stories in this space based on its unique position in the commoditized hyper-competitive bar and grill segment, a viable business strategy and a debt free balance sheet.

One of BJ’sprimary competitors, California Pizza Kitchen Inc. (CPKI) will report its first quarter 2011 results on May 6, 2011.

 
BJ'S RESTAURANT (BJRI): Free Stock Analysis Report
 
CALIF PIZZA KIT (CPKI): Free Stock Analysis Report
 
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