-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, THkQeMnpB2RLdSKXN+KA5RlghzQDKOmiFo/ap12lLeymmzwoC3ouy6A3LfH13Gdd HKGN92HYgMFhJRCEEYn4JQ== 0001157523-04-009437.txt : 20041019 0001157523-04-009437.hdr.sgml : 20041019 20041019163515 ACCESSION NUMBER: 0001157523-04-009437 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20041019 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20041019 DATE AS OF CHANGE: 20041019 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CHEESECAKE FACTORY INCORPORATED CENTRAL INDEX KEY: 0000887596 STANDARD INDUSTRIAL CLASSIFICATION: RETAIL-EATING PLACES [5812] IRS NUMBER: 510340466 STATE OF INCORPORATION: DE FISCAL YEAR END: 1229 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-20574 FILM NUMBER: 041085661 BUSINESS ADDRESS: STREET 1: 26950 AGOURA RD CITY: CALABASAS HILLS STATE: CA ZIP: 91301 BUSINESS PHONE: 8188809323 MAIL ADDRESS: STREET 1: 26950 AGOURA RD STREET 2: 26950 AGOURA RD CITY: CALABASAS HILLS STATE: CA ZIP: 91301 8-K 1 a4745174.txt CHEESECAKE FACTORY INC. ================================================================================ 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 October 19, 2004 Date of Report (Date of earliest event reported) THE CHEESECAKE FACTORY INCORPORATED (Exact Name of Registrant as Specified in its Charter) Delaware 0-20574 51-0340466 (State or other jurisdiction (Commission File Number) (IRS Employer of incorporation) Identification No.) 26950 Agoura Road Calabasas Hills, California 91301 (Address of principal executive offices) (818) 871-3000 (Registrant's telephone number, including area code) 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 (see General Instruction A.2. below): |_| 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 240.14.d-2(b)) |_| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) ================================================================================ SECTION 2 - Financial Information Item 2.02 Results of Operations and Financial Condition On October 19, 2004, The Cheesecake Factory Incorporated issued a press release entitled "The Cheesecake Factory Reports Record Revenues for the Fiscal Quarter Ended September 28, 2004", a copy of which is attached as Exhibit 99.1 to this Current Report on Form 8-K. In that press release, the Company uses a non-GAAP financial measure to present net income after adjustment for an unusual and unpredictable event. Specifically, the Company has disclosed net income after excluding the effect of a $4.5 million legal reserve established for pending litigation. The Cheesecake Factory management believes the presentation of this non-GAAP financial measure provides useful information to investors regarding the Company's results of operations as this non-GAAP financial measure allows investors to better evaluate the Company's ongoing business performance. SECTION 9 - Financial Statements and Exhibits Item 9.01 Financial Statements and Exhibits (c) Exhibits 99.1 Press Release dated October 19, 2004 entitled "The Cheesecake Factory Reports Record Revenues for the Fiscal Quarter Ended September 28, 2004". 2 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: October 19, 2004 THE CHEESECAKE FACTORY INCORPORATED By: /s/ MICHAEL J. DIXON ------------------------------------------------- Michael J. Dixon Senior Vice President and Chief Financial Officer 3 EXHIBIT INDEX Exhibit Description - --------------------- ------------------------------------------------------ 99.1 Press Release dated October 19, 2004 entitled "The Cheesecake Factory Reports Record Revenues for the Fiscal Quarter Ended September 28, 2004." 4 EX-99.1 2 a4745174ex991.txt NEWS RELEASE Exhibit 99.1 The Cheesecake Factory Reports Record Revenues for the Fiscal Quarter Ended September 28, 2004 CALABASAS HILLS, Calif.--(BUSINESS WIRE)--Oct. 19, 2004--The Cheesecake Factory Incorporated (Nasdaq:CAKE) today reported record revenues for the fiscal third quarter ended September 28, 2004. Revenues increased 25% to $247.7 million and comparable restaurant sales increased 2.6% compared to the same quarter of the prior year. Net income for the quarter was $12.8 million or $0.24 per diluted share, including a $4.5 million or $0.06 per share reserve established for pending lawsuits, compared to net income of $14.4 million or $0.28 per diluted share for the same quarter last year. Before the effect of this reserve, net income per diluted share would have been $0.30 per share, composed of the $0.24 per share plus the $0.06 per share related to the reserve. The reserve was established to accrue for the estimated expenses that may be incurred in connection with claims alleging failure to comply with California labor laws with respect to providing employee meal and rest breaks, as previously disclosed by the Company. This $4.5 million expense is included in the "other operating expenses" line in the Company's Consolidated Statements of Operations. "We are very pleased with our record revenues for the third quarter, especially considering the severe weather in Florida and other parts of the Southeast," said David Overton, Chairman and CEO. "Sales for our comparable restaurants increased 2.6% in spite of an estimated $1.8 to $2.0 million impact on our total restaurant sales during the quarter due to the weather. The strength of our brand and popularity of our concept is clearly demonstrated by our positive comparable restaurant sales and strong new restaurant openings. "We expect to achieve our stated goal of opening 16 restaurants in the current year," stated Overton. Seven new Cheesecake Factory restaurants were opened in the third quarter and one Cheesecake Factory restaurant was opened on October 12, bringing the total for the year to twelve. Two additional Cheesecake Factory restaurants are expected to open in the fourth quarter. The Company also opened a Grand Lux Cafe in Dallas during the third quarter and will open an additional Grand Lux Cafe in Houston during the fourth quarter. "We are very happy to extend our Grand Lux Cafe concept into Texas and are pleased with our initial sales from the Dallas location," stated Overton. "We are excited about the long-term growth potential for the Grand Lux Cafe as we continue to fine tune the concept's menu, operations and investment cost." The Company's current expansion goal for fiscal 2005 is to open as many as 18 new full-service restaurants, consisting of approximately 15 Cheesecake Factory restaurants and three Grand Lux Cafes. Signed leases or letters of intent are in-hand for most of the potential 2005 openings. Bakery sales to other foodservice operators, retailers and distributors increased 24% to $12.7 million during the third quarter, compared to the same quarter last year. Sales to warehouse clubs continue to be very strong and sales of The Dream Factory product line continue to build. The Cheesecake Factory Incorporated operates 85 upscale, casual dining restaurants under The Cheesecake Factory(R) name that offer an extensive menu of more than 200 items with an average check of approximately $16.09. The Company also operates a bakery production facility that produces over 50 varieties of quality cheesecakes and other baked products for the Company's restaurants and for other leading foodservice operators, retailers and distributors. Additionally, the Company operates four upscale casual dining restaurants under the Grand Lux Cafe(R) name; one self-service, limited menu "express" foodservice operation under The Cheesecake Factory Express(R) mark inside the DisneyQuest(R) family entertainment center in Orlando, Florida; and licenses three bakery cafe outlets to another foodservice operator under The Cheesecake Factory Bakery Cafe(R) name. This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by forward-looking 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. In particular, forward-looking statements regarding the Company's restaurant sales trends are subject to risks and uncertainties due to national and regional economic and public safety conditions that impact consumer confidence and spending, as well as weather and other factors outside of the Company's control. Forward-looking statements regarding bakery sales are subject to a number of risks and uncertainties, including (but not limited to) unforeseen changes in the purchasing plans of the Company's large-account bakery customers and inherent difficulties in predicting the timing of product orders and shipments. Forward-looking statements regarding the number and timing of the Company's planned new restaurant openings, and the amount and timing of their associated preopening costs, are subject to risks and uncertainties due to factors outside of the Company's control, including factors that are under the control of government agencies, landlords and others. Forward-looking statements regarding pending litigation and the potential costs associated with that litigation are subject to a number of risks and uncertainties, including interpretations or clarifications of existing laws made by governmental or judicial bodies. Forward-looking statements speak only as of the dates on which they were made. 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 the securities laws. Investors are referred to the full discussion of risks and uncertainties associated with forward-looking statements contained in the Company's filings with the Securities and Exchange Commission. The Cheesecake Factory Incorporated and Subsidiaries Consolidated Financial Statements (unaudited; in thousands, except per share and statistical data) 13 Weeks Ended 13 Weeks Ended Consolidated Statements of September 28, September 30, Operations 2004 2003 - ---------------------------------------------------- ----------------- Revenues: Amounts Percents Amounts Percents ---------------------------------- Restaurant sales $235,018 94.9% $187,655 94.9% Bakery sales to other foodservice operators, retailers and distributors 12,665 5.1% 10,177 5.1% ---------------- ----------------- Total revenues 247,683 100.0% 197,832 100.0% ---------------- ----------------- Costs and expenses: Restaurant cost of sales (1) 58,756 23.7% 45,492 23.0% Bakery cost of sales (2) 6,405 2.6% 4,664 2.4% Labor expenses 76,822 31.0% 60,395 30.5% Other operating expenses 60,799 24.5% 46,487 23.4% General and administrative expenses 10,022 4.1% 9,075 4.6% Depreciation and amortization expenses 9,034 3.6% 6,975 3.5% Preopening costs 6,867 2.8% 4,066 2.1% ---------------- ----------------- Total costs and expenses 228,705 92.3% 177,154 89.5% ---------------- ----------------- Income from operations 18,978 7.7% 20,678 10.5% Interest income, net 605 0.2% 987 0.5% Other income, net 116 0.1% 665 0.3% ---------------- ----------------- Income before income taxes 19,699 8.0% 22,330 11.3% Income tax provision 6,915 2.8% 7,972 4.0% ---------------- ----------------- Net income $12,784 5.2% $14,358 7.3% ================ ================= Basic net income per share $0.25 $0.28 ========= ========= Basic weighted average shares outstanding 51,846 50,522 ========= ========= Diluted net income per share $0.24 $0.28 ========= ========= Diluted weighted average shares outstanding 52,853 51,900 ========= ========= 39 Weeks Ended 39 Weeks Ended Consolidated Statements of September 28, September 30, Operations 2004 2003 - ---------------------------------------------------- ----------------- Revenues: Amounts Percents Amounts Percents ---------------------------------- Restaurant sales $669,295 95.2% $531,647 95.1% Bakery sales to other foodservice operators, retailers and distributors 33,840 4.8% 27,665 4.9% ---------------- ----------------- Total revenues 703,135 100.0% 559,312 100.0% ---------------- ----------------- Costs and expenses: Restaurant cost of sales (1) 168,315 23.9% 127,122 22.7% Bakery cost of sales (2) 17,591 2.5% 12,767 2.3% Labor expenses 217,514 30.9% 174,557 31.2% Other operating expenses 163,553 23.3% 129,720 23.2% General and administrative expenses 29,660 4.2% 26,859 4.8% Depreciation and amortization expenses 25,478 3.6% 20,241 3.6% Preopening costs 10,935 1.6% 7,368 1.4% ---------------- ----------------- Total costs and expenses 633,046 90.0% 498,634 89.2% ---------------- ----------------- Income from operations 70,089 10.0% 60,678 10.8% Interest income, net 1,899 0.2% 2,909 0.5% Other income, net 821 0.1% 2,146 0.4% ---------------- ----------------- Income before income taxes 72,809 10.3% 65,733 11.7% Income tax provision 25,556 3.6% 23,467 4.1% ---------------- ----------------- Net income $47,253 6.7% $42,266 7.6% ================ ================= Basic net income per share $0.91 $0.84 ========= ========= Basic weighted average shares outstanding 51,687 50,270 ========= ========= Diluted net income per share $0.89 $0.82 ========= ========= Diluted weighted average shares outstanding 52,882 51,644 ========= ========= Notes: - ----- (1) Consists of restaurant food, beverage and dessert costs. (2) Consists of bakery ingredient, packaging and supply costs. Selected Consolidated Balance Sheet Information September December 28, 30, 2004 2003 - ---------------------------------------------------------------------- Cash and cash equivalents $6,454 $15,167 Investments and marketable securities 115,512 121,840 Total assets 663,152 584,808 Total liabilities 140,666 126,906 Stockholders' equity 522,486 457,902 13 Weeks 13 Weeks 39 Weeks 39 Weeks Ended Ended Ended Ended Supplemental Information Sept. 28, Sept. 30, Sept. 28, Sept. 30, 2004 2003 2004 2003 - ---------------------------------------- --------- --------- --------- Comparable restaurant sales % change 2.6% 1.8% 4.3% 0.1% Restaurant cost of sales % of restaurant sales 25.0% 24.2% 25.1% 23.9% Bakery cost of sales % of bakery sales 50.6% 45.8% 52.0% 46.1% Restaurants opened during period 8 3 12 7 Restaurants open at period-end 89 70 89 70 Restaurant operating weeks 1,084 884 3,129 2,570 CONTACT: The Cheesecake Factory Incorporated Jane Vallaire, 818-871-3000 -----END PRIVACY-ENHANCED MESSAGE-----