Chuy’s(CHUY) - 2023 Q4 - Annual Report

Dividends and Share Repurchase - The company did not declare or pay any dividends during the fiscal years ended December 31, 2023, and December 25, 2022, and does not anticipate paying cash dividends in the foreseeable future [177]. - The company repurchased a total of 167,535 shares of common stock at an average price of $35.40 per share during the fourteen weeks ended December 31, 2023, with$21.1 million remaining under its $50 million repurchase program [178]. - The company repurchased 789,963 shares for a total cost of$28.9 million in 2023, compared to 1,661,742 shares for $41.7 million in 2022 [207]. Restaurant Operations and Growth - As of December 31, 2023, the company operated 101 restaurants, an increase from 98 restaurants at the end of the previous fiscal year [185]. - The company plans to open six to eight new restaurants in fiscal 2024, following the opening of four restaurants in fiscal 2023 [185]. - The company’s growth strategy includes pursuing new restaurant development in existing major markets and backfilling smaller existing markets to build brand awareness [185]. Sales and Revenue - Comparable restaurant sales increased by 3.3$19.02 for the fiscal year ended December 31, 2023, up from $18.14 in the previous year [189]. - Revenue for the year ended December 31, 2023, was$461.3 million, an increase of 9.3% from $422.2 million in fiscal 2022 [200]. - Comparable restaurant sales increased by 3.3$31.4 million in 2023, up from $26.3 million in 2022, driven by a$2.9 million increase in performance-based bonuses [200]. - Restaurant pre-opening costs increased by $0.6 million to$2.0 million in 2023, reflecting the timing of new store openings [200]. - Impairment, closed restaurant, and other costs decreased to $5.0 million in 2023 from$6.5 million in 2022, driven by a reduction in closed restaurant costs [200]. - Depreciation increased to $21.1 million in 2023 from$20.2 million in 2022 [200]. Profitability and Income - Net income for fiscal 2023 was $31.5 million, compared to$20.9 million in fiscal 2022, reflecting a 51.1% increase [200]. - Income tax expense increased to $5.4 million in 2023 from$2.4 million in 2022, with an effective tax rate of 14.7% compared to 10.1% in the prior year [200]. - Net income decreased to $20.9 million in 2022 from$30.2 million in 2021 [204]. Cash Flow and Financial Position - Net cash provided by operating activities increased to $59.1 million in 2023 from$42.8 million in 2022, mainly due to a $10.6 million increase in net income [205]. - As of December 31, 2023, the company had$67.8 million in cash and cash equivalents and no debt [205]. - The company had net working capital of $31.6 million at December 31, 2023, down from$43.5 million at December 25, 2022 [211]. - Total contractual obligations as of December 31, 2023, amount to $346,682,000, with$73,652,000 due within one year [215]. - Operating lease obligations total $300,165,000, including$27,135,000 due within one year and $166,887,000 due after five years [215]. Debt and Interest Rate Risk - The company entered into an Amended and Restated Credit Agreement on September 27, 2023, extending the maturity date to September 27, 2026 [212]. - The company has no borrowings under its Revolving Credit Facility as of December 31, 2023, mitigating interest rate risk [223]. - Each quarter point change in interest rates on the variable portion of indebtedness would result in an annualized change of approximately$2,500 per million dollars borrowed [223]. Market Risks - The company is exposed to fluctuations in food product prices, which can materially impact food and beverage costs [224]. - Long-term agreements have been established for some commodities, but future supply and cost fluctuations remain a risk [224]. - The company does not currently use financial instruments to hedge against market price fluctuations in food product prices [224]. Accounting and Reporting - The company’s financial statements are prepared in accordance with generally accepted accounting principles in the United States [217].