The Cheesecake Factory(CAKE) - 2025 Q3 - Quarterly Results

Financial Highlights and Business Overview Third Quarter 2024 Financial Performance The Cheesecake Factory achieved its fourth consecutive quarter of year-over-year growth in Q3 2024, with revenues and net income increasing Q3 Fiscal 2024 Key Financial Results | Financial Metric | Q3 2024 | Q3 2023 | | :--- | :--- | :--- | | Total Revenues | $865.5 million | $830.2 million | | Net Income (GAAP) | $30.0 million | $17.9 million | | Diluted EPS (GAAP) | $0.61 | $0.37 | | Adjusted Net Income | $28.2 million | $19.0 million | | Adjusted Diluted EPS | $0.58 | $0.39 | - Comparable restaurant sales at The Cheesecake Factory restaurants increased by 1.6% year-over-year in the third quarter of fiscal 2024[4] - The company recorded a pre-tax net income of $2.5 million from impairment of assets, lease termination income, and FRC acquisition-related expenses, resulting in an adjusted net income of $28.2 million[3] Operational Highlights and Management Commentary Management highlighted strong operational execution and market share gains, driven by improved productivity, retention, and successful new restaurant openings - The company is capturing market share, evidenced by strong outperformance in comparable sales and traffic at The Cheesecake Factory restaurants compared to the broader casual dining industry[5] - Restaurant operations showed exceptional execution with significant improvements in labor productivity, hourly staff and manager retention, and guest satisfaction scores[5] - A total of 17 new restaurants have opened year-to-date, reinforcing confidence in achieving near-term and long-term development objectives[5] Operational and Corporate Updates Restaurant Development The company continued its expansion, opening four new restaurants in Q3 and three post-quarter, targeting up to 22 new locations in fiscal 2024 - In Q3 2024, the company opened four new restaurants: one Flower Child and three other FRC locations[6] - Subsequent to the quarter-end, three additional restaurants were opened: one North Italia, one Flower Child, and one Blanco[6] - The company expects to open as many as 22 new restaurants in fiscal 2024, including up to three The Cheesecake Factory, six North Italia, and six to seven Flower Child locations[7] Liquidity and Capital Allocation As of October 1, 2024, the company maintained strong liquidity with $288.7 million available, alongside stock repurchases and dividend declarations Liquidity and Debt as of October 1, 2024 | Metric | Amount | | :--- | :--- | | Total Available Liquidity | $288.7 million | | Cash Balance | $52.2 million | | Revolving Credit Facility Availability | $236.5 million | | Total Principal Debt Outstanding | $475 million | - Repurchased approximately 29,450 shares of stock for $1.1 million in Q3 2024[9] - The Board of Directors declared a quarterly dividend of $0.27 per share, payable on November 26, 2024[9] Financial Statements Condensed Consolidated Financial Statements The condensed consolidated income statement for Q3 2024 shows significant year-over-year increases in revenues, income from operations, and net income Consolidated Income Statement Highlights (Q3 2024 vs Q3 2023, in millions) | Metric (13 Weeks Ended) | Oct 1, 2024 | Oct 3, 2023 | | :--- | :--- | :--- | | Revenues | $865.5 M | $830.2 M | | Income from Operations | $33.7 M | $19.0 M | | Net Income | $30.0 M | $17.9 M | | Diluted Net Income per Share | $0.61 | $0.37 | Consolidated Income Statement Highlights (39 Weeks Ended, in millions) | Metric (39 Weeks Ended) | Oct 1, 2024 | Oct 3, 2023 | | :--- | :--- | :--- | | Revenues | $2,660.7 M | $2,562.5 M | | Income from Operations | $131.7 M | $100.4 M | | Net Income | $115.6 M | $88.7 M | | Diluted Net Income per Share | $2.37 | $1.80 | Selected Segment Information Segment data for Q3 2024 highlights The Cheesecake Factory as the primary revenue and profit driver, with North Italia also showing strong growth Segment Revenues (13 Weeks Ended Oct 1, 2024 vs Oct 3, 2023, in millions) | Segment | Q3 2024 Revenue | Q3 2023 Revenue | | :--- | :--- | :--- | | The Cheesecake Factory | $647.8 M | $628.1 M | | North Italia | $71.9 M | $62.4 M | | Other FRC | $67.0 M | $58.6 M | | Other | $78.9 M | $81.0 M | Segment Income from Operations (13 Weeks Ended Oct 1, 2024 vs Oct 3, 2023, in millions) | Segment | Q3 2024 Income | Q3 2023 Income | | :--- | :--- | :--- | | The Cheesecake Factory | $87.8 M | $67.6 M | | North Italia | $4.4 M | $4.1 M | | Other FRC | ($1.4 M) | $1.0 M | - At the end of the period, the company had 215 The Cheesecake Factory restaurants, 39 North Italia restaurants, and a total of 341 company-owned restaurants[17][18] Reconciliation of Non-GAAP Results to GAAP Results The company reconciled GAAP to non-GAAP results for Q3 2024, adjusting net income and diluted EPS to exclude non-recurring items Q3 2024 Reconciliation of GAAP to Non-GAAP Net Income | Description | Amount (in thousands) | | :--- | :--- | | Net income (GAAP) | $29,994 | | Impairment/lease termination (income) | ($3,472) | | Acquisition-related expenses | $1,020 | | Tax effect of adjustments | $638 | | Adjusted net income (non-GAAP) | $28,180 | Q3 2024 Reconciliation of GAAP to Non-GAAP Diluted EPS | Description | Amount per Share | | :--- | :--- | | Diluted net income per share (GAAP) | $0.61 | | Impairment/lease termination (income) | ($0.07) | | Acquisition-related expenses | $0.02 | | Tax effect of adjustments | $0.01 | | Adjusted net income per share (non-GAAP) | $0.58 |