Cheesecake Factory: Reports Q4 of Fiscal 2018 Results

Calabas Hills / CA. (cf) The Cheesecake Factory Incorporated reported financial results for the fourth quarter of fiscal 2018, which ended on January 01, 2019.

Total revenues were USD 585.2 million in the fourth quarter of fiscal 2018 compared to USD 571.8 million in the fourth quarter of fiscal 2017. Net income and diluted net income per share were USD 16.2 million and USD 0.35, respectively, in the fourth quarter of fiscal 2018.

The Company recorded a pre-tax charge of USD 15.0 million during the fourth quarter of fiscal 2018, including USD 13.9 million in non-cash impairment primarily related to one restaurant in each of the Cheesecake Factory, Grand Lux Cafe and RockSugar Southeast Asian Kitchen brands. Excluding the after-tax impact from this item, net income and diluted net income per share for the fourth quarter of fiscal 2018 would have been USD 27.3 million and USD 0.60, respectively. Please see the Company’s reconciliation of non-GAAP financial measures at the end of this release.

Comparable restaurant sales at The Cheesecake Factory restaurants increased 1.9 percent in the fourth quarter of fiscal 2018.

«Our key financial metrics, including Cheesecake Factory comparable restaurant sales, adjusted operating margin and adjusted earnings per share, met or exceeded our expectations during the fourth quarter,» said David Overton, Chairman and Chief Executive Officer. «Solid operational execution, illustrated by year-over-year increases in labor productivity and food efficiencies, contributed to these results.»

Overton continued, «We are also honoured to be recognized as one of the «100 Best Companies to Work For» by Fortune magazine for the sixth consecutive year. Our people are our greatest resource and enable us to deliver delicious, memorable experiences for our guests every day. This accolade is a testament to our strong culture, industry-leading training and tangible career advancement we provide for our staff members and managers. We believe these attributes will continue to differentiate us as an employer of choice, a position that is even more critical today to support continued success in the restaurant industry.»

Overton concluded, «During fiscal 2018, we generated over USD 290 million in operating cash flow, which coupled with our strong balance sheet, enables us to make investments to support the Company’s growth trajectory, while continuing to return meaningful capital to our shareholders via our dividend and share repurchase program.»

Development

The Company opened three Cheesecake Factory restaurants in the fourth quarter, meeting its objective to open five restaurants in fiscal 2018. Two restaurants opened internationally under licensing agreements during fiscal 2018.

Capital Allocation

The Company’s Board of Directors declared a quarterly cash dividend of USD 0.33 per share of the Company’s common stock. The dividend is payable on March 19, 2019 to shareholders of record at the close of business on March 4, 2019.

During the fourth quarter of fiscal 2018, the Company repurchased approximately 1.0 million shares of its common stock at a cost of USD 48.4 million. In fiscal 2018, the Company repurchased approximately 2.3 million shares of its common stock at a cost of USD 109.3 million.

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