Calabas Hills / CA. (cf) The Cheesecake Factory Inc. reported financial results for the third quarter of fiscal 2014, which ended on September 30, 2014. Total revenues were 499.1 million USD in the third quarter of fiscal 2014 as compared to 469.7 million USD in the prior year third quarter. Net income and diluted net income per share were 24.2 million USD and 0.48 USD, respectively, in the third quarter of fiscal 2014.
Operating Results
Comparable restaurant sales at The Cheesecake Factory and Grand Lux Cafe increased 1.8 percent in the third quarter of fiscal 2014. By concept, comparable restaurant sales grew 2.1 percent at The Cheesecake Factory and declined 2.0 percent at Grand Lux Cafe.
«Our consistent and predictable topline trends have improved, and we achieved our 19th consecutive quarter of positive comparable sales in the third quarter of 2014. We were again named North America´s favourite casual dining chain by Market Force Information in August, which speaks to our ability to continue outperforming the industry and increasing our market share», said David Overton, Chairman and Chief Executive Officer.
«There are clearly some significant external cost headwinds in our current environment, including unprecedented increases in butter and related dairy prices during the third quarter, resulting in about 4.3 million USD of additional expense compared to the third quarter of 2013. However, recently we are seeing the dairy market beginning to correct, and within the four walls of our restaurants we remain well positioned going forward as our tenured operations team is effectively maintaining our high guest satisfaction scores, labor productivity and food efficiency results. In addition, our unit growth is on track for this year, including both company owned restaurants in the United States and licensed locations with our international partners», continued Overton.
Development
The Company expects to open as many as ten Company-owned restaurants in fiscal 2014, including one relocation. Six restaurants have opened so far this year, including two in the third quarter of fiscal 2014 in Reno, Nevada and Trumbull, Connecticut, and our most recent opening in Sarasota, Florida last week.
In addition, our licensee partners opened two The Cheesecake Factory restaurants in the Middle East and one in Mexico during the third quarter of fiscal 2014. The Company continues to expect as many as four restaurants to open internationally under licensing agreements in fiscal 2014.
Capital Allocation
The Company´s Board of Directors declared a quarterly cash dividend of 0.165 USD per share on the Company´s common stock. The dividend is payable on November 18, 2014 to shareholders of record at the close of business on November 05, 2014.
During the third quarter of fiscal 2014, the Company repurchased approximately 456’000 shares of its common stock at a cost of 19.8 million USD. Year-to-date, the Company repurchased 3.1 million shares of its common stock at a cost of 140.0 million USD. The Company continues to expect that it will return all of its free cash flow to shareholders in fiscal 2014 in the form of dividends and up to 150 million USD in share repurchases.
«Our prospects for continued value creation remain excellent, evidenced by our improving comparable sales trends and high productivity from our new restaurant openings. The strength of our brand and relevancy of our concepts provide an outstanding foundation from which we will continue to grow our sales and earnings into 2015 and beyond», concluded Overton.
