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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 OR
15(d) of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
October 26, 2023
THE CHEESECAKE FACTORY INCORPORATED
(Exact name of registrant as specified in its
charter)
Delaware |
|
0-20574 |
|
51-0340466 |
(State
or other jurisdiction |
|
(Commission |
|
(IRS
Employer |
of
incorporation) |
|
File
Number) |
|
Identification
No.) |
26901
Malibu Hills Road Calabasas Hills,
California |
|
91301 |
(Address
of principal executive offices) |
|
(Zip
Code) |
Registrant’s telephone number, including
area code (818) 871-3000
Not Applicable
(Former name or former address, if changed since
last report.)
Check the appropriate box below if the Form 8-K
filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ¨ | Written
communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ¨ | Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ¨ | Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ¨ | Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
Title of each class: |
|
Trading
Symbol(s) |
|
Name of each exchange on which registered: |
Common
Stock, par value $.01 per share |
|
CAKE |
|
The Nasdaq Stock Market LLC |
Indicate by check mark whether the registrant
is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2
of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging
growth company ¨
If
an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨
The
following information under Item 2.02 of Form 8-K, “Results of Operations and Financial Condition” and Item 7.01 “Regulation
FD Disclosure” is intended to be furnished. This information shall not be deemed “filed” for purposes of Section 18
of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference in any filing under
the Securities Act of 1933, as amended, or the Exchange Act, whether made before or after the date of this report, regardless of any
general incorporation language in the filing.
| ITEM
2.02 | RESULTS
OF OPERATIONS AND FINANCIAL CONDITION |
In
a press release dated November 1, 2023, a copy of which is furnished as Exhibit 99.1 to this report, The Cheesecake Factory Incorporated
(the “Company”) reported third quarter fiscal 2023 financial results.
| ITEM
7.01 | REGULATION
FD DISCLOSURE |
On
November 1, 2023, the Company posted an updated Investor Presentation on the Company’s Investor Relations website at investors.thecheesecakefactory.com.
A copy of the presentation is furnished as Exhibit 99.2 hereto and is incorporated by reference herein.
On
October 26, 2023, the Board declared a quarterly cash dividend of $0.27 per share which will be paid on November 28, 2023 to the stockholders
of record of each share of the Company’s common stock at the close of business on November 15, 2023. Future decisions to pay or
to increase or decrease dividends are at the discretion of the Board and will depend upon operating performance and other factors.
| ITEM
9.01 | FINANCIAL
STATEMENTS AND EXHIBITS |
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
Date: November
1, 2023 |
THE
CHEESECAKE FACTORY INCORPORATED |
|
|
|
By: |
/s/
Matthew E. Clark |
|
|
Matthew
E. Clark |
|
|
Executive
Vice President and Chief Financial Officer |
Exhibit 99.1
FOR IMMEDIATE RELEASE |
Contact: Etienne Marcus |
|
(818) 871-3000 |
|
investorrelations@thecheesecakefactory.com |
THE CHEESECAKE FACTORY REPORTS
RESULTS FOR
THIRD QUARTER OF FISCAL
2023 AND PROVIDES BUSINESS UPDATE
CALABASAS
HILLS, Calif. – November 1, 2023 – The Cheesecake Factory Incorporated (NASDAQ: CAKE) today reported financial
results for the third quarter of fiscal 2023, which ended on October 3, 2023.
Total revenues were $830.2 million in the third
quarter of fiscal 2023 compared to $784.0 million in the third quarter of fiscal 2022. Net income and diluted net income per share were
$17.9 million and $0.37, respectively, in the third quarter of fiscal 2023.
The Company recorded a pre-tax net expense of
$1.5 million primarily related to Fox Restaurant Concepts (“FRC”) acquisition-related expenses. Excluding the after-tax impact
of this item, adjusted net income and adjusted net income per share for the third quarter of fiscal 2023 were $19.0 million and $0.39,
respectively. Please see the Company’s reconciliation of non-GAAP financial measures at the end of this press release.
Comparable restaurant sales at The Cheesecake
Factory restaurants increased 2.4% year-over-year in the third quarter of fiscal 2023 and increased 12.6% relative to the third quarter
of fiscal 2019, on an operating week basis.
“Our third quarter results reflect positive
sales trends, as we continued to outperform the broader casual dining industry led by solid comparable sales growth at The Cheesecake
Factory restaurants,” said David Overton, Chairman and Chief Executive Officer. “Our performance amidst the softening sales
environment is a testament to the resilient consumer demand for the distinct, high-quality dining experiences we provide our guests. Our
tenured operators continued to do an excellent job effectively managing their restaurants and consistently delivering exceptional food
quality, service and hospitality to drive sales.”
“During the quarter we opened two Cheesecake
Factory restaurants to strong demand, further underscoring the enduring appeal and brand affinity for our flagship concept. We remain
sharply focused on accelerating our unit growth to achieve our long-term development objectives, even though we continue to experience
delays beyond our control. As the macroeconomic environment has gradually stabilized and input costs have continued to improve this year,
the stability of our operational and financial performance reinforces our belief we are well positioned to drive meaningful growth, shareholder
value and market share gains going forward.”
26901 Malibu Hills Road,
Calabasas Hills, CA 91301 • Telephone (818) 871-3000
Development
During the third quarter of fiscal 2023, the Company
opened two Cheesecake Factory restaurants, one in Birkdale, NC and the other in Estero, FL. While the Company continues to make progress
against its pipeline, opening timelines continued to be pressured by substantial permitting delays, as such the Company is strategically
shifting some restaurant openings into the first quarter of fiscal 2024. As a result, the Company now expects to open as many as 16 new
restaurants in fiscal 2023 and as many as four to six new restaurants in the first quarter of fiscal 2024. The fiscal 2023 new restaurant
openings include as many as five Cheesecake Factory restaurants, four North Italia restaurants, and as many as seven FRC restaurants,
including one Flower Child location.
Additionally, the Company expects two Cheesecake
Factory restaurants to open internationally under licensing agreements in fiscal 2023.
Liquidity and Capital Allocation
As of October 3, 2023, the Company had total available
liquidity of $300.5 million, including a cash balance of $64.0 million and availability on its revolving credit facility of $236.5 million.
Total principal amount of debt outstanding was $475 million, including $345 million in principal amount of 0.375% convertible senior notes
due 2026 and $130 million in principal amount drawn on the Company’s revolving credit facility.
The Company repurchased approximately 453,400
shares of its stock at a cost of $14.6 million in the third quarter of fiscal 2023. In addition, the Company’s Board of Directors
has declared a quarterly dividend of $0.27 per share to be paid on November 28, 2023 to shareholders of record at the close of business
on November 15, 2023.
Conference Call and Webcast
The Company will hold a conference call to review
its results for the third quarter of fiscal 2023 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 December 1, 2023.
About The Cheesecake Factory Incorporated
The Cheesecake
Factory Incorporated is a leader in experiential dining. We are culinary forward and relentlessly focused on hospitality. Delicious,
memorable experiences created by passionate people – this defines who we are and where we are going. We currently own and operate
325 restaurants throughout the United States and Canada under brands including The Cheesecake Factory®,
North Italia® and a collection within our Fox Restaurant Concepts business. Internationally,
31 The Cheesecake Factory® restaurants operate under licensing agreements. Our
bakery division operates two facilities that produce quality cheesecakes and other baked products for our restaurants, international
licensees and third-party bakery customers. In 2023, we were named to the FORTUNE Magazine “100 Best Companies to Work For®”
list for the tenth consecutive year. To learn more, visit www.thecheesecakefactory.com, www.northitalia.com and www.foxrc.com.
From Fortune ©2023 Fortune
Media IP Limited. All rights reserved. Used under license. Fortune and Fortune 100 Best Companies to Work For are registered trademarks
of Fortune Media IP Limited and are used under license. Fortune and Fortune Media IP Limited are not affiliated with, and do not endorse
products or services of, The Cheesecake Factory Incorporated.
26901 Malibu Hills Road,
Calabasas Hills, CA 91301 • Telephone (818) 871-3000
Safe Harbor Statement
This press release contains forward-looking statements
within the meaning of the Private Securities Litigation Reform Act of 1995, as codified in Section 27A of the Securities Act of 1933,
as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements include, without limitation, statements
regarding positive sales trends, customer demand, continuing permitting delays, stability of operational and financial performance and
restaurant development expectations. Such forward-looking statements include all other statements that are not historical facts, as well
as statements that are preceded by, followed by or that include words or phrases such as “believe,” “plan,” “will
likely result,” “expect,” “intend,” “will continue,” “is anticipated,” “estimate,”
“project,” “may,” “could,” “would,” “should” and similar expressions. These
statements are based on current expectations and involve risks and uncertainties which may cause results to differ materially from those
set forth in such statements. Investors are cautioned that forward-looking statements are not guarantees of future performance and that
undue reliance should not be placed on such statements. These forward-looking statements may be affected by various factors including:
economic, public health and political conditions that impact consumer confidence and spending, including rising interest rates, periods
of heightened inflation and market instability, and armed conflicts; supply chain disruptions; demonstrations, political unrest, potential
damage to or closure of the Company’s restaurants and potential reputational damage to the Company or any of its brands; pandemics
and related containment measures, including the potential for quarantines or restriction on in-person dining; acceptance and success
of The Cheesecake Factory in international markets; acceptance and success of North Italia and the Fox Restaurant Concepts restaurants;
the risks of doing business abroad through Company-owned restaurants and/or licensees; foreign exchange rates, tariffs and cross border
taxation; changes in unemployment rates; increases in minimum wages and benefit costs; the economic health of the Company’s landlords
and other tenants in retail centers in which its restaurants are located, and the Company’s ability to successfully manage its
lease arrangements with landlords; the economic health of suppliers, licensees, vendors and other third parties providing goods or services
to the Company; the timing of new unit development and related permitting; compliance with debt covenants; strategic capital allocation
decisions including with respect to share repurchases or dividends; the ability to achieve projected financial results; the resolution
of uncertain tax positions with the Internal Revenue Service and the impact of tax reform legislation; changes in laws impacting the
Company’s business; 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; the risks, costs and uncertainties associated with opening
new restaurants; and other risks and uncertainties detailed from time to time in the Company’s filings with the Securities and
Exchange Commission (“SEC”). 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 law. 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.
26901 Malibu Hills Road,
Calabasas Hills, CA 91301 • Telephone (818) 871-3000
The Cheesecake Factory Incorporated
Condensed Consolidated Financial Statements
(unaudited; in thousands, except per share and statistical
data)
| |
13 Weeks Ended | | |
13 Weeks Ended | | |
39 Weeks Ended | | |
39 Weeks Ended | |
| |
October 3, 2023 | | |
September 27, 2022 | | |
October 3, 2023 | | |
September 27, 2022 | |
Consolidated Statements of Income | |
Amount | | |
Percent of Revenues | | |
Amount | | |
Percent of Revenues | | |
Amount | | |
Percent of Revenues | | |
Amount | | |
Percent of Revenues | |
Revenues | |
$ | 830,210 | | |
| 100.0 | % | |
$ | 784,001 | | |
| 100.0 | % | |
$ | 2,562,494 | | |
| 100.0 | % | |
$ | 2,410,354 | | |
| 100.0 | % |
Costs and expenses: | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Food and beverage cost | |
| 194,733 | | |
| 23.5 | % | |
| 197,774 | | |
| 25.2 | % | |
| 602,051 | | |
| 23.5 | % | |
| 590,457 | | |
| 24.5 | % |
Labor expenses | |
| 301,663 | | |
| 36.3 | % | |
| 293,040 | | |
| 37.4 | % | |
| 919,340 | | |
| 35.9 | % | |
| 893,322 | | |
| 37.1 | % |
Other operating costs and expenses | |
| 229,534 | | |
| 27.6 | % | |
| 217,009 | | |
| 27.7 | % | |
| 687,459 | | |
| 26.7 | % | |
| 643,844 | | |
| 26.7 | % |
General and administrative expenses | |
| 54,209 | | |
| 6.5 | % | |
| 50,324 | | |
| 6.4 | % | |
| 162,766 | | |
| 6.4 | % | |
| 149,638 | | |
| 6.2 | % |
Depreciation and amortization expenses | |
| 22,837 | | |
| 2.8 | % | |
| 22,651 | | |
| 2.9 | % | |
| 69,124 | | |
| 2.7 | % | |
| 66,764 | | |
| 2.8 | % |
Impairment of assets and lease termination expenses | |
| 48 | | |
| 0.0 | % | |
| - | | |
| 0.0 | % | |
| 1,637 | | |
| 0.1 | % | |
| 313 | | |
| 0.0 | % |
Acquisition-related contingent consideration, compensation
and amortization expenses | |
| 1,414 | | |
| 0.2 | % | |
| 1,081 | | |
| 0.1 | % | |
| 3,890 | | |
| 0.2 | % | |
| 2,920 | | |
| 0.1 | % |
Preopening costs | |
| 6,742 | | |
| 0.8 | % | |
| 4,327 | | |
| 0.6 | % | |
| 15,800 | | |
| 0.6 | % | |
| 9,038 | | |
| 0.4 | % |
Total costs and expenses | |
| 811,180 | | |
| 97.7 | % | |
| 786,206 | | |
| 100.3 | % | |
| 2,462,067 | | |
| 96.1 | % | |
| 2,356,296 | | |
| 97.8 | % |
Income/(loss) from operations | |
| 19,030 | | |
| 2.3 | % | |
| (2,205 | ) | |
| (0.3 | )% | |
| 100,427 | | |
| 3.9 | % | |
| 54,058 | | |
| 2.2 | % |
Interest and other expense, net | |
| (2,027 | ) | |
| (0.3 | )% | |
| (1,315 | ) | |
| (0.1 | )% | |
| (6,069 | ) | |
| (0.2 | )% | |
| (3,906 | ) | |
| (0.1 | )% |
Income/(loss) before income taxes | |
| 17,003 | | |
| 2.0 | % | |
| (3,520 | ) | |
| (0.4 | )% | |
| 94,358 | | |
| 3.7 | % | |
| 50,152 | | |
| 2.1 | % |
Income tax (benefit)/provision | |
| (942 | ) | |
| (0.2 | )% | |
| (1,122 | ) | |
| (0.1 | )% | |
| 5,688 | | |
| 0.2 | % | |
| 3,731 | | |
| 0.2 | % |
Net income/(loss) | |
$ | 17,945 | | |
| 2.2 | % | |
$ | (2,398 | ) | |
| (0.3 | )% | |
$ | 88,670 | | |
| 3.5 | % | |
$ | 46,421 | | |
| 1.9 | % |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Basic net income/(loss) per share | |
$ | 0.37 | | |
| | | |
$ | (0.05 | ) | |
| | | |
$ | 1.83 | | |
| | | |
$ | 0.93 | | |
| | |
Basic weighted average shares outstanding | |
| 48,281 | | |
| | | |
| 49,653 | | |
| | | |
| 48,489 | | |
| | | |
| 50,124 | | |
| | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Diluted net income/(loss) per share | |
$ | 0.37 | | |
| | | |
$ | (0.05 | ) | |
| | | |
$ | 1.80 | | |
| | | |
$ | 0.92 | | |
| | |
Diluted weighted average shares outstanding | |
| 48,985 | | |
| | | |
| 49,653 | | |
| | | |
| 49,197 | | |
| | | |
| 50,708 | | |
| | |
26901 Malibu Hills Road,
Calabasas Hills, CA 91301 • Telephone (818) 871-3000
| |
13 Weeks Ended | | |
13 Weeks Ended | | |
39 Weeks Ended | | |
39 Weeks Ended | |
Selected Segment Information | |
October 3, 2023 | | |
September 27, 2022 | | |
October 3, 2023 | | |
September 27, 2022 | |
Revenues: | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| |
The Cheesecake Factory restaurants | |
$ | 628,140 | | |
| | | |
$ | 602,902 | | |
| | | |
$ | 1,936,621 | | |
| | | |
$ | 1,853,576 | | |
| | |
North Italia | |
| 62,417 | | |
| | | |
| 54,113 | | |
| | | |
| 191,654 | | |
| | | |
| 163,108 | | |
| | |
Other FRC | |
| 58,642 | | |
| | | |
| 52,193 | | |
| | | |
| 193,010 | | |
| | | |
| 171,045 | | |
| | |
Other | |
| 81,011 | | |
| | | |
| 74,793 | | |
| | | |
| 241,209 | | |
| | | |
| 222,625 | | |
| | |
Total | |
$ | 830,210 | | |
| | | |
$ | 784,001 | | |
| | | |
$ | 2,562,494 | | |
| | | |
$ | 2,410,354 | | |
| | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Income/(loss) from operations | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
The Cheesecake Factory restaurants | |
$ | 67,637 | | |
| | | |
$ | 42,122 | | |
| | | |
$ | 231,700 | | |
| | | |
$ | 169,893 | | |
| | |
North Italia | |
| 4,081 | | |
| | | |
| 1,655 | | |
| | | |
| 15,314 | | |
| | | |
| 10,381 | | |
| | |
Other FRC | |
| 1,036 | | |
| | | |
| 4,109 | | |
| | | |
| 15,826 | | |
| | | |
| 18,231 | | |
| | |
Other | |
| (53,724 | ) | |
| | | |
| (50,091 | ) | |
| | | |
| (162,413 | ) | |
| | | |
| (144,447 | ) | |
| | |
Total | |
$ | 19,030 | | |
| | | |
$ | (2,205 | ) | |
| | | |
$ | 100,427 | | |
| | | |
$ | 54,058 | | |
| | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Depreciation and amortization expenses: | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
The Cheesecake Factory restaurants | |
$ | 15,702 | | |
| | | |
$ | 15,874 | | |
| | | |
$ | 47,955 | | |
| | | |
$ | 47,736 | | |
| | |
North Italia | |
| 1,578 | | |
| | | |
| 1,556 | | |
| | | |
| 4,713 | | |
| | | |
| 4,076 | | |
| | |
Other FRC | |
| 1,891 | | |
| | | |
| 1,661 | | |
| | | |
| 5,627 | | |
| | | |
| 4,712 | | |
| | |
Other | |
| 3,666 | | |
| | | |
| 3,560 | | |
| | | |
| 10,829 | | |
| | | |
| 10,240 | | |
| | |
Total | |
$ | 22,837 | | |
| | | |
$ | 22,651 | | |
| | | |
$ | 69,124 | | |
| | | |
$ | 66,764 | | |
| | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Impairment of assets and lease termination expenses: | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
The Cheesecake Factory restaurants | |
$ | 29 | | |
| | | |
$ | - | | |
| | | |
$ | 160 | | |
| | | |
$ | (59 | ) | |
| | |
North Italia | |
| - | | |
| | | |
| - | | |
| | | |
| - | | |
| | | |
| - | | |
| | |
Other FRC | |
| - | | |
| | | |
| - | | |
| | | |
| 55 | | |
| | | |
| - | | |
| | |
Other | |
| 19 | | |
| | | |
| - | | |
| | | |
| 1,422 | | |
| | | |
| 372 | | |
| | |
Total | |
$ | 48 | | |
| | | |
$ | - | | |
| | | |
$ | 1,637 | | |
| | | |
$ | 313 | | |
| | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Preopening costs: | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
The Cheesecake Factory restaurants | |
$ | 3,861 | | |
| | | |
$ | 2,757 | | |
| | | |
$ | 8,401 | | |
| | | |
$ | 5,163 | | |
| | |
North Italia | |
| 1,068 | | |
| | | |
| 1,341 | | |
| | | |
| 2,132 | | |
| | | |
| 2,755 | | |
| | |
Other FRC | |
| 1,764 | | |
| | | |
| 84 | | |
| | | |
| 4,483 | | |
| | | |
| 357 | | |
| | |
Other | |
| 49 | | |
| | | |
| 145 | | |
| | | |
| 784 | | |
| | | |
| 763 | | |
| | |
Total | |
$ | 6,742 | | |
| | | |
$ | 4,327 | | |
| | | |
$ | 15,800 | | |
| | | |
$ | 9,038 | | |
| | |
| |
13 Weeks Ended | | |
13 Weeks Ended | | |
39 Weeks Ended | | |
39 Weeks Ended | |
The Cheesecake Factory restaurants operating information: | |
October 3, 2023 | | |
September 27, 2022 | | |
October 3, 2023 | | |
September 27, 2022 | |
Comparable restaurant sales vs. prior year | |
| 2.4 | % | |
| | | |
| 1.1 | % | |
| | | |
| 3.2 | % | |
| | | |
| 8.2 | % | |
| | |
Comparable restaurant sales vs. 2019 | |
| 12.6 | % | |
| | | |
| 9.5 | % | |
| | | |
| 13.9 | % | |
| | | |
| 10.2 | % | |
| | |
Restaurants opened during period | |
| 2 | | |
| | | |
| 1 | | |
| | | |
| 3 | | |
| | | |
| 1 | | |
| | |
Restaurants open at period-end | |
| 213 | | |
| | | |
| 209 | | |
| | | |
| 213 | | |
| | | |
| 209 | | |
| | |
Restaurant operating weeks | |
| 2,756 | | |
| | | |
| 2,705 | | |
| | | |
| 8,227 | | |
| | | |
| 8,113 | | |
| | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
North Italia operating information: | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Comparable restaurant sales vs. prior year | |
| 8 | % | |
| | | |
| 10 | % | |
| | | |
| 8 | % | |
| | | |
| 17 | % | |
| | |
Comparable restaurant sales vs. 2019 | |
| 28 | % | |
| | | |
| 18 | % | |
| | | |
| 30 | % | |
| | | |
| 21 | % | |
| | |
Restaurants opened during period | |
| - | | |
| | | |
| 1 | | |
| | | |
| - | | |
| | | |
| 2 | | |
| | |
Restaurants open at period-end | |
| 33 | | |
| | | |
| 31 | | |
| | | |
| 33 | | |
| | | |
| 31 | | |
| | |
Restaurant operating weeks | |
| 429 | | |
| | | |
| 395 | | |
| | | |
| 1,287 | | |
| | | |
| 1,150 | | |
| | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Other Fox Restaurant Concepts (FRC) operating information:(1) | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Restaurants opened during period | |
| - | | |
| | | |
| 1 | | |
| | | |
| 3 | | |
| | | |
| 1 | | |
| | |
Restaurants open at period-end | |
| 37 | | |
| | | |
| 32 | | |
| | | |
| 37 | | |
| | | |
| 32 | | |
| | |
Restaurant operating weeks | |
| 481 | | |
| | | |
| 413 | | |
| | | |
| 1,394 | | |
| | | |
| 1,219 | | |
| | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Other operating information:(2) | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Restaurants opened during period | |
| - | | |
| | | |
| - | | |
| | | |
| 1 | | |
| | | |
| 1 | | |
| | |
Restaurants open at period-end | |
| 40 | | |
| | | |
| 39 | | |
| | | |
| 40 | | |
| | | |
| 39 | | |
| | |
Restaurant operating weeks | |
| 520 | | |
| | | |
| 507 | | |
| | | |
| 1,555 | | |
| | | |
| 1,514 | | |
| | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Number of company-owned restaurants: | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
The Cheesecake Factory | |
| 213 | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
North Italia | |
| 33 | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Other FRC | |
| 37 | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Other | |
| 40 | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Total | |
| 323 | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Number of international-licensed restaurants: | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
The Cheesecake Factory | |
| 30 | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
(1) The Other FRC segment includes all FRC brands except Flower Child.
(2)
The Other segment includes the Flower Child, Grand Lux Cafe and Social Monk Asian Kitchen concepts, as well as the Company's third-party
bakery, international and consumer packaged goods businesses, unallocated corporate expenses and gift card costs.
Selected Consolidated Balance Sheet Information | |
October 3, 2023 | | |
January 3, 2023 | |
Cash and cash equivalents | |
$ | 63,987 | | |
$ | 114,777 | |
Long-term debt, net of issuance costs (1) | |
| 469,543 | | |
| 468,032 | |
(1) Includes $339.5 million net balance of 0.375% convertible senior notes due 2026 (principal amount of $345 million less $5.5 million in unamortized issuance costs) and $130 million drawn on the Company's revolving credit facility. The unamortized issuance costs were recorded as a contra-liability and netted with long-term debt on the Condensed Consolidated Balance Sheet and are being amortized as interest expense.
26901 Malibu Hills Road,
Calabasas Hills, CA 91301 • Telephone (818) 871-3000
Reconciliation of Non-GAAP Results to GAAP Results
In addition to the results provided in accordance with accounting
principles generally accepted in the United States of America (“GAAP”) in this press release, the Company is providing
non-GAAP measurements which present net income/(loss) and net income/(loss) per share excluding the impact of certain items. The
non-GAAP measurements are intended to supplement the presentation of the Company’s financial results in accordance with GAAP.
These non-GAAP measures are calculated by eliminating from net income/(loss) and diluted net income/(loss) per share the impact of
items the Company does not consider indicative of its ongoing operations. The Company uses these non-GAAP financial measures for
financial and operational decision-making and as a means to evaluate period-to-period comparisons.
The Cheesecake Factory Incorporated
Reconciliation of Non-GAAP Financial Measures
(unaudited; in thousands, except per share data)
| |
13 Weeks Ended | | |
13 Weeks Ended | | |
39 Weeks Ended | | |
39 Weeks Ended | |
| |
October 3, 2023 | | |
September 27, 2022 | | |
October 3, 2023 | | |
September 27, 2022 | |
Net income/(loss) (GAAP) | |
$ | 17,945 | | |
$ | (2,398 | ) | |
$ | 88,670 | | |
$ | 46,421 | |
Impairment of assets and lease termination expenses(1) | |
| 48 | | |
| - | | |
| 1,637 | | |
| 313 | |
Acquisition-related
contingent consideration, compensation and amortization expenses(2) | |
| 1,414 | | |
| 1,081 | | |
| 3,890 | | |
| 2,920 | |
Tax effect of adjustments(3) | |
| (380 | ) | |
| (281 | ) | |
| (1,437 | ) | |
| (840 | ) |
Adjusted net income/(loss) (non-GAAP) | |
$ | 19,027 | | |
$ | (1,598 | ) | |
$ | 92,760 | | |
$ | 48,814 | |
| |
| | | |
| | | |
| | | |
| | |
Diluted net income/(loss) per share (GAAP) | |
$ | 0.37 | | |
$ | (0.05 | ) | |
$ | 1.80 | | |
$ | 0.92 | |
Impairment of assets and lease termination expenses | |
| 0.00 | | |
| - | | |
| 0.03 | | |
| 0.01 | |
Acquisition-related contingent consideration, compensation and amortization expenses | |
| 0.03 | | |
| 0.02 | | |
| 0.08 | | |
| 0.06 | |
Tax effect of adjustments | |
| (0.01 | ) | |
| (0.01 | ) | |
| (0.03 | ) | |
| (0.02 | ) |
Adjusted net income/(loss) per share (non-GAAP)(4) | |
$ | 0.39 | | |
$ | (0.03 | ) | |
$ | 1.89 | | |
$ | 0.96 | |
(1) A detailed breakdown of impairment of assets and lease termination expenses recorded in the thirteen and thirty-nine weeks ended October 3, 2023 and September 27, 2022 can be found in the Selected Segment Information table.
(2) Represents changes in the fair value of the deferred consideration and contingent consideration and compensation liabilities related to the North Italia and FRC acquisition, as well as amortization of acquired definite-lived licensing agreements.
(3) Based on the federal statutory rate and an estimated blended state tax rate, the tax effect on all adjustments assumes a 26% tax rate for the fiscal 2023 and 2022 periods.
(4) Adjusted net income per share may not add due to rounding.
26901 Malibu Hills Road,
Calabasas Hills, CA 91301 • Telephone (818) 871-3000
Exhibit 99.2
| Investor Presentation
November 1, 2023 |
| Safe Harbor Statement
2
This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. This includes, without limitation, financial guidance and projections, including underlying assumptions, and statements with respect to expectations of the Company’s future financial condition,
results of operations, cash flows, plans, targets, goals, objectives, performance, growth potential, engines and opportunities and expected growth rates; industry-leading comparable sales growth,
retention and competitive position; quality control and supply chain efficiencies; operational execution and retention; annualized average unit volume; the Company’s differentiation and strong foothold in
the off-premise channel; statements from the Company’s corporate social responsibility report; the opportunity for additional domestic and foreign locations and licensees and territories; target returns for
new restaurant openings; international expansion; North Italia and Fox Restaurant Concepts (“FRC”) as growth drivers and FRC as an incubation engine; anticipated unit growth roadmap; and unit
growth rates.
Such forward-looking statements include all other statements that are not historical facts, as well as statements that are preceded by, followed by or that include words or phrases such as “believe,”
“plan,” “will likely result,” “expect,” “intend,” “will continue,” “is anticipated,” “estimate,” “project,” “may,” “could,” “would,” “should” and similar expressions. These statements are based on current
expectations and involve risks and uncertainties which may cause results to differ materially from those set forth in such statements. Investors are cautioned that forward-looking statements are not
guarantees of future performance and that undue reliance should not be placed on such statements. These forward-looking statements may be affected by various factors including: economic, public
health and political conditions that impact consumer confidence and spending, including rising interest rates, periods of heightened inflation and market instability, and armed conflicts; supply chain
disruptions; demonstrations, political unrest, potential damage to or closure of our restaurants and potential reputational damage to us or any of our brands; pandemics and related containment
measures, including the potential for quarantines or restriction on in-person dining; acceptance and success of The Cheesecake Factory in international markets; acceptance and success of North Italia
and the FRC concepts; the risks of doing business abroad through Company-owned restaurants and/or licensees; foreign exchange rates, tariffs and cross border taxation; changes in unemployment
rates; increases in minimum wages and benefit costs; the economic health of our landlords and other tenants in retail centers in which our restaurants are located, and our ability to successfully manage
our lease arrangements with landlords; the economic health of suppliers, licensees, vendors and other third parties providing goods or services to us; the timing of our new unit development and related
permitting; compliance with debt covenants; strategic capital allocation decisions including with respect to share repurchases or dividends; the ability to achieve projected financial results; the resolution
of uncertain tax positions with the Internal Revenue Service and the impact of tax reform legislation; changes in laws impacting our business; 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; the risks, costs and uncertainties associated with opening new restaurants; and other
risks and uncertainties detailed from time to time in the Company’s filings with the Securities and Exchange Commission (“SEC”). 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 law. 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.
Make sure this
conforms to 10-Q |
| • Experiential dining category leader with diversified growth engines
• Leveraging the Company’s differentiation and strong foothold in the off-premise
channel to support the business in the on-going dynamic environment
• Best-in-class operational execution and industry-leading retention
• Significant and accelerating growth opportunities driving one of the highest
expected growth rates in the casual dining industry
Investment Highlights
3 |
| The Cheesecake Factory - Global Footprint
4
High quality, high profile locations worldwide
Company-Owned: 213
(Including Toronto, Canada)
Toronto
International – Licensed: 31
Mexico
City
(5)
Guadalajara
Saudi
Arabia
(4) UAE
(6)
Kuwait
(3)
Qatar
(3)
Bahrain
(1)
Shanghai (3)
Hong Kong
Beijing
Monterrey
Macau
Opportunity for 300 Domestic Locations Over Time &
Continued International Expansion |
| Filling White Space for an On-Trend,
Contemporary Italian Offering
5
• Potential for 200 domestic locations over time
• 33 locations in 13 states & Washington D.C.
• All dishes handmade from scratch daily
• Unique menu items tailored to local markets
• Serving lunch, dinner, weekend brunch &
weekday happy hour
• Average check: ~$30-$40
• ~25% alcohol mix
3Q23 Comp Sales (vs. 3Q22): 8%
3Q23 Comp Sales (vs. 3Q19): 28% |
| Fox Restaurant Concepts (FRC) Expected to Serve as an
Incubation Engine Innovating Concepts of the Future
6
Potential Growth
Boutique Brands
70 Total FRC Locations Across the U.S. |
| Culinary Dropout
Charlotte, NC
Accelerating Unit Growth Across Concepts
AS MANY AS 16 NEW UNITS PLANNED FOR 2023
14 RESTAURANTS OPENED IN 2021 13 RESTAURANTS OPENED IN 2022
Doughbird
Nashville, TN
Doughbird
Tucson, AZ
The Cheesecake Factory
South Beach, FL
The Henry
Miami, FL
Flower Child
Tucson, AZ
The Cheesecake Factory
Birkdale, NC
New Restaurants Opened in 2023
The Cheesecake Factory
Estero, FL
Doughbird
Phoenix, AZ |
| An Experiential Dining Category Leader
Food Integrated Bakery Service & Ambiance
Breadth of Menu & Innovation
235 Items Made Fresh, From Scratch
Integrated Bakery
Best-in-Class Service, Hospitality
and Operational Execution
Innovative, High-Quality
Cheesecakes and Other Baked
Dessert Items |
| Integrated Bakery – The “Cheesecake” Magic
• Produces over 60 cheesecakes
and other baked desserts
• Enables creativity, quality control
and supply chain efficiencies
FY 2019*
16%
10
Industry-Leading Dessert Sales
* Percent of total sales
FY 2022*
17% |
| Best-in-Class Operational Execution and
Industry-Leading Retention
“We found that food and beverage innovation
is table stakes; you need to do it, but it’s not
sustainable. The ironclad correlation with
success? It was GM retention.”
– Wally Doolin, Black Box Intelligence**
11
10th CONSECUTIVE YEAR Recognized as a best workplace for
diversity, millennials and women
Average Tenure by Position*
33 years
25 years
22 years
21 years
12 years
11 years
Senior VP of Operations
Regional Vice Presidents
Area Directors of Operations
Area Kitchen Operations Managers
General Managers
Executive Kitchen Managers
*Tenure data as of latest published 10-K; **Restaurant Business, May 2018
2023 PEOPLE Companies that Care logo © 2023 TI Gotham, Inc., a Dotdash Meredith company. Used under license.
From Fortune ©2023 Fortune Media IP Limited. All rights reserved. Used under license. Fortune and Fortune 100 Best Companies to Work For are registered trademarks of Fortune Media
IP Limited and are used under license. Fortune and Fortune Media IP Limited are not affiliated with, and do not endorse products or services of, The Cheesecake Factory Incorporated. |
| Themed filters
reaching 5M+
users
Cult Status & Strong Consumer Engagement
1M+
followers
5M fans
350K
followers
Millions of
Viewers
12 Note: Statistics as of October 25, 2023
350K
followers |
| Broad Consumer Demographic and Appeal
Highest Unit Volumes With a Moderate Average Check
($ in millions)
Source: Latest SEC 10-K filings and company presentations; Average check for The Cheesecake Factory defined as on-premise average check. 13
$12.1
$9.5
$7.0 $6.0 $5.5 $4.7 $3.9 $3.4 $3.4 $3.2
Maggiano's Texas
Roadhouse
BJ's Olive
Garden
LongHorn Outback Carrabba's Chili's Bonefish
$35 $33 $32 $29 $27 $26 $24 $23 $21 $20 $19
Yard
House
Bonefish Maggiano's Outback LongHorn Carraba's Olive
Garden
Texas
Roadhouse
BJ's Chili's
Casual Dining
Rated #1 Full-Service Chain for
Food Quality #1 Quality #2 Service #3
Ambiance |
| 9% 12% 14%
16%
43%
32% 25% 23% 22% 21%
Off-Premise Sales
(% of Total Revenue)
Leveraging This Differentiation in the
Off-Premise Channel
Upgraded Takeout Packaging
14
~$2.5 million per restaurant
(annualized based on 3Q23*)
Reflecting COVID-19
dining restrictions
*Annual unit volume equivalent based on total system restaurant average weekly sales
Operating weeks * 52 weeks * |
| Further Leaning in to Convenience
15 |
| >$6M
Donated to
Feeding America®
93%
Of staff believe
people are treated
fairly regardless of
sexual orientation,
race, or gender
26%
Waste diverted
away from
landfill
369
HELP Fund Grants
Provided
22%
Lower GHGs per
sq. ft. since 2015
7.3M
Pounds food donated
SOURCING ENVIRONMENT STAFF & DEI&B COMMUNITY
NET
ZERO
Greenhouse
gas target
80%
Pork gestation
crate-free sourcing
64%
Sustainable seafood
700
Local non-profits
supported
13yr*
Tenure of General
Managers & Executive
Kitchen Managers
CSR – Contributing to the Well-Being of Our Staff, Local
Communities and the Environment We All Share
16
Please refer to the 2022 Cheesecake Factory Corporate Social Responsibility Report.
Data and restaurants included in the report represent The Cheesecake Factory, North Italia, Grand Lux Cafe, and Social Monk Asian Kitchen unless noted otherwise.
*Does not include North Italia or Social Monk Asian Kitchen.
From Fortune ©2023 Fortune Media IP Limited. All rights reserved. Used under license. Fortune and Fortune 100 Best Companies to Work For are registered trademarks of Fortune Media IP Limited and are used under license.
Fortune and Fortune Media IP Limited are not affiliated with, and do not endorse products or services of, The Cheesecake Factory Incorporated.
2023 PEOPLE Companies that Care logo © 2023 TI Gotham, Inc., a Dotdash Meredith company. Used under license.
Feeding America® is a registered trademark owned by Feeding America non-profit corporation.
10TH Year
as one of the FORTUNE
100 Best Companies
to Work For®
PEOPLE
Companies that
Care®
award recipient
100%
Cage-free eggs,
3 years early
for bakery
operations |
| Confidential
17
Financial Resiliency
Sales Leadership
Growth Opportunities |
| Culinary forward. First class hospitality. Concepts like no other.
Diversify Across Experiential
Diversifying Our Portfolio Across Experiential
For Growth
18 |
| Driving Strong Sales Growth Across Portfolio
+1.1%
3Q23 Comp Sales
~$227,900
Equates to $11.9M Annualized
Average Unit Volume
3Q23 Average Weekly Sales
3Q23 AWS
Note: Average Unit Volumes annualized based on 2Q23 average weekly sales (AWS). 19
~$145,500
Equates to $7.6M Annualized
Average Unit Volume
~$121,900
Equates to $6.3M Annualized
Average Unit Volume
vs. 3Q22 vs. 3Q19
2.4% 12.6%
vs. 3Q22 vs. 3Q19
8% 28%
vs. 3Q22 vs. 3Q19
(1)% 21% |
| “Large chains and well-funded restaurants have the resources to ride out a protracted
shutdown, but the independent restaurants that make up two-thirds of the
American dining landscape – noodle shops, diners and that charming urban restaurant
that always had a line out the door – may not survive.”
- New York Times, March 20, 2020
Sales by Channel4
(AUV $ millions)
We Believe Stable, Agile Brands Will Be Best
Positioned Moving Forward
20
Industry Rationalization: Market Share Opportunity
Casual Dining1
* FY 2022 on a 53-week basis
Sources: 1Morgan Stanley Report April 6, 2020; 2Bureau of Labor Statistics; 3U.S. Census; 4Annualized average unit volumes based on average weekly sales in each period.
Off-Premise Sales Have Stabilized
At Elevated Levels Post-Pandemic
86%
14%
Independents
Chains
Off-Premise Only
2
As of May 2021, the
NRA estimated that 15%
(~90,000) of restaurants
have closed.
3
1.4%
1.8% 2.1%
1.3%
1.5% 1.5% 1.8%
2.5% 2.2%
1.9%
0.8% 0.7% 0.7% 0.7% 0.7% 0.7% 0.7% 0.6% 0.5%0.5%
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Annual Restaurant Unit Growth US Population Growth
Off-Premise Only
$9.1 $9.1
$1.7 $3.0
2019 2022*
Off-Premise
On-Premise
$10.8
$12.1 |
| 2023 Underlying Key Assumptions(1)
21
(1) Assumes no material operating or consumer disruptions
(2) On a 52 operating week comparison
(3) Future decisions to pay or to increase or decrease dividends or to repurchase shares are at the discretion of the Board and will be dependent on several factors
• As many as 16 new restaurant openings
• 5 The Cheesecake Factory locations
• 4 North Italia locations
• 7 FRC restaurants, including 1 Flower Child location
• Q3 2023 dividend of $0.27 per share(3)
• Continue to support share repurchase program – at a minimum offset dilution from
employee stock-based compensation and support EPS (3)
Consolidated
Sales
Approx. $3.45B
4% YOY Growth
Net Income
Margin
Targeting ~3.9% at
stated sales level
CCF AUVs Approx. $12.3M
~2% YOY Growth(2)
Capital
Expenditure $150M - $160M |
| Diversified Growth Engines Expected to
Drive 7% Unit Growth Annually
Target Size (productive sq. ft.) 7,000 – 10,000 6,000 - 7,000 3,500 – 15,000
Targeted Average Unit Volume $11M - $12M $7M - $7.5M Avg. $5M - $5.5M
Targeted Sales/productive sq. ft. ~$1,100 ~$1,200 ~$1,000
Target Long-Term Unit Growth ~3% ~20%+ ~15% - 20%
Top-Line Unit Growth Contribution ~3% ~2% ~2%
Target Restaurant-Level Margin % ~18% ~18% - 20% ~16% - 18%
Cash Capex Investment $8M+ ~$4M+ $500/sq. ft.
Target Cash-on-Cash Return 20% - 25% 35%+ 25% - 30%
Sales/Investment Ratio Varies 2:1 2:1
22
Diversified multi-concept across
segment,
price point,
occasion,
real estate and
labor
Leveraging brand
power, operational
excellence, scale,
supply chain and
real estate
development
expertise
Anticipated Unit
Growth Roadmap
¹Illustrative example of target returns for new restaurant openings
²Average unit volume and steady-state restaurant-level margin typically reached after 3 years of operations
¹
² ² |
| (4.2)%
(6.8)%
(0.3)%
4.0% 4.2% 3.3% 2.6%
4.1% 3.8%
0.4% 0.9%
2.5%
(27.4)%
3.3%
7.0%
(4.3)%
(8.7)%
(6.1)%
1.0% 2.0%
(0.9)% (1.6)%
0.8%
(0.4)%
(2.2)%
0.5% 1.4%
(24.0)%
(0.9)%
7.4%
History of Outperforming the Industry
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 20201 20212 20222
Knapp-Track Index
Comparable Sales - Historical 2-year Stack
23
Industry Outperformance
During Economic Downturn
Geographical discrepancies
in dining restrictions &
reopening timelines
1) 2020 results reflect the impact of the COVID-19 pandemic.
2) Due to impact of COVID-19 pandemic on 2020 results, 2021 compares against 2019, and 2022 compares against 2021. |
| 24
$0.84 $1.07
$1.42 $1.64 $1.88 $2.10 $1.97
$2.37
$2.83 $2.60 $2.51 $2.61
$(1.49)
$2.13
$1.51
'08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '20 '21 '22
Capital Allocation Detail
$85
$163
$128 $120 $112 $107
$135
$94
$158
$100
$163
$120
$(47)
$146
$50
'08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '20 '21 '22
¹Free cash flow defined as cash flow from operations (includes adjustment for excess tax benefit related to stock options exercised in 2008-2016 to conform to current year presentation) less capital
expenditures and investment in unconsolidated affiliates prior to the acquisition of North Italia and Fox Restaurant Concepts
²2019 Capex/Investment does not include the acquisition of North Italia and Fox Restaurant Concepts
Note: 2020 results reflect the impact of the COVID-19 pandemic and the issuance of 200,000 shares of Series A Convertible Preferred Stock. Please refer to the appendix for GAAP to Non-GAAP
reconciliations and to SEC filings for an explanation regarding an accounting reclassification for prior years
$85 $37 $42 $77 $86 $106 $114 $154 $158 $139 $128 $99 $50 $67 $112
$173
$52
$172 $101
$184 $141 $109 $146
$123 $109
$51
$4
$6
$63
$13
$27
$30 $36
$42
$50 $56
$61
$16
$42
64,009
44,545
50,414
'08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '20 '21 '22
Capex / Investment ² Share Repurchases Common Stock Dividend Weighted Average Shares Outstanding
Durable Business Over Time
Adjusted Earnings/(Loss) Per Common Share Free Cash Flow¹ ($ in millions)
($ in millions)
‘20 ‘20 |
| Appendix |
| Non-GAAP Reconciliations
In addition to the results provided in accordance with the Generally Accepted
Accounting Principles (“GAAP”) in this presentation, the Company is providing
non-GAAP measurements which present adjusted diluted net income/(loss)
per common share excluding the impact of certain items and free cash flow.
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.
26 |
| Non-GAAP Reconciliation
(1) A detailed breakdown of impairment of assets and lease termination expenses recorded in the fourteen and fifty-three weeks ended January 3, 2023 and thirteen and fifty-two weeks ended December 28, 2021 can be found in the Selected Segment Information table in the 10-K.
(2) Represents incremental costs associated with COVID-19 such as sick and vaccination pay, healthcare and meal benefits for furloughed staff members, additional sanitation and personal protective equipment.
(3) The tax effect assumes a tax rate based on the federal statutory rate and an estimated blended state tax rate.
(4) Fiscal 2017 includes a $38.5 million benefit to the income tax provision related to tax reform enacted in December 2017.
(5) Adjusted diluted net income/(loss) per common share may not add due to rounding. 27
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Net income/(loss) per common share (GAAP) $ 52,293 $ 42,833 $ 81,713 $ 95,720 $ 98,423 $114,356 $101,276 $116,523 $139,494 $157,392 $ 99,035 $127,293 $ (277,107) $ 49,131 $ 43,123
- Impairment of assets and lease termination expenses(1)
2,952 26,541 - 1,547 9,536 (561) 696 6,011 114 10,343 17,861 18,247 219,333 18,139 31,387
- Partial IRS settlement - - - (1,794) - - - - - - - - - - -
- Termination of Interest rate swap - 7,421 7,376 - - - - - - - - - - 2,354 -
- Chairman and CEO employment agreement - 2,550 - - - - - - - - - - - -
- Proceeds from variable life insurance contract - (668) - - (419) - - - - - - - - - -
- Loss on investment in unconsolidated affiliates - - - - - - - - - 479 4,754 13,439 - - -
- Gain on investment in unconsolidated affiliates - - - - - - - - - - - (52,672) - - -
- Acquisition-related costs - - - - - - - - - - - 5,270 2,699 - -
- Acquisition-related contingent consideration, compensation and amortization expenses/(benefit) - - - - - - - - - - - 1,033 (3,872) 19,510 13,368
- Dividends on Series A preferred stock - - - - - - - - - - - - 13,485 18,661 -
- Net income attributable to Series A preferred stock to apply if-converted method - - - - - - - - - - - - - 4,581 -
- Direct and incremental Series A preferred stock issuance costs - - - - - - - - - - - - 10,257 - -
- Assumed impact of potential conversion of Series A preferred stock into common stock - - - - - - - - - - - - - - -
- COVID-19 related costs (2)
- - - - - - - - - - - - 22,963 4,917 -
- Uncertain tax positions - - - - - - - - - - - - - 7,139 -
- Tax effect of adjustments (3)
(1,181) (14,605) (2,951) (331) (3,814) 224 (278) (2,404) (46) (4,329) (5,880) 3,818 (62,692) (11,679) (11,637)
- One-time tax items (4)
- - - - - - - - - (38,525) - - - - -
Adjusted net income/(loss) per common share (non-GAAP) $ 54,064 $ 64,072 $ 86,138 $ 95,142 $103,726 $114,019 $101,694 $120,130 $139,562 $125,360 $115,770 $116,428 $ (74,934) $ 112,753 $ 76,241
Diluted net income/(loss) per common share (GAAP) $ 0.82 $ 0.71 $ 1.35 $ 1.64 $ 1.78 $ 2.10 $ 1.96 $ 2.30 $ 2.83 $ 3.27 $ 2.14 $ 2.86 $ (6.32) $ 1.01 $ 0.86
- Impairment of assets and lease termination expenses 0.05 0.44 - 0.03 0.17 (0.01) 0.01 0.12 0.00 0.21 0.39 0.41 4.36 0.34 0.62
- Partial IRS settlement - - - (0.03) - - - - - - - - - - -
- Termination of Interest rate swap - 0.12 0.12 - - - - - - - - - - 0.04 -
- Chairman and CEO employment agreement - 0.04 - - - - - - - - - - - - -
- Proceeds from variable life insurance contract - (0.01) - - (0.01) - - - - - - - - - -
- Loss on investment in unconsolidated affiliates - - - - - - - - - 0.01 0.10 0.30 - - -
- Gain on investment in unconsolidated affiliates - - - - - - - - - - - (1.18) - - -
- Acquisition-related costs - - - - - - - - - - - 0.12 0.05 - -
- Acquisition-related contingent consideration, compensation and amortization expenses/(benefit) - - - - - - - - - - - 0.02 (0.08) 0.37 0.27
- Dividends on Series A preferred stock - - - - - - - - - - - - 0.27 0.35 -
- Net income attributable to Series A preferred stock to apply if-converted method - - - - - - - - - - - - - 0.09 -
- Direct and incremental Series A preferred stock issuance costs - - - - - - - - - - - - 0.20 - -
- Assumed impact of potential conversion of Series A preferred stock into common stock - - - - - - - - - - - - 0.80 (0.08) -
- COVID-19 related costs - - - - - - - - - - - - 0.46 0.09 -
- Uncertain tax positions - - - - - - - - - - - - - 0.13 -
- Tax effect of adjustments (0.03) (0.23) (0.05) - (0.06) 0.01 - (0.05) 0.00 (0.09) (0.12) 0.09 (1.25) (0.22) (0.23)
- One-time tax items - - - - - - - - - (0.80) - - - - -
Adjusted diluted net income/(loss) per common share (non-GAAP) (5) $ 0.84 $ 1.07 $ 1.42 $ 1.64 $ 1.88 $ 2.10 $ 1.97 $ 2.37 $ 2.83 $ 2.60 $ 2.51 $ 2.61 $ (1.49) $ 2.13 $ 1.51
Fiscal Year
The Cheesecake Factory Incorporated Reconciliation of Non-GAAP Financial Measures
($ in thousands, except per share data) |
| Non-GAAP Reconciliation
(1) The excess tax benefit related to stock options exercised is no longer reclassified from cash flows from operating activities to cash flows from financing activities in the consolidated statements of cash flows.
The consolidated statements of cash flows for fiscal 2016, 2015, 2014, 2013, 2012, 2011, 2010, 2009 and 2008 have been adjusted to conform to the current year presentation. 28
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Cash flow from operations (1) $ 170 $ 200 $ 170 $ 197 $ 198 $ 213 $ 249 $ 248 $ 316 $ 239 $ 291 $ 219 $ 3 $ 213 $ 162
Capital expenditures / investments 85 37 42 77 86 106 114 154 158 139 128 99 50 67 112
Free cash flow $ 85 $ 163 $ 128 $ 120 $ 112 $ 107 $ 135 $ 94 $ 158 $ 100 $ 163 $ 120 $ (47) $ 146 $ 50
Fiscal Year
The Cheesecake Factory Incorporated
Reconciliation of Non-GAAP Financial Measures
($ in millions) |
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