The Cheesecake Factory Incorporated (NASDAQ: CAKE) has announced its financial results for the second quarter of fiscal 2024, ending on July 2, 2024.
The company reported total revenues of $904.0 million for Q2 2024, up from $866.2 million in Q2 2023. Net income for the quarter was $52.4 million, with diluted net income per share at $1.08.
A pre-tax net expense of $1.0 million was recorded related to Fox Restaurant Concepts (FRC) acquisition expenses, asset impairment, and lease termination income. Excluding these items, adjusted net income was $53.2 million, and adjusted net income per share was $1.09. A reconciliation of non-GAAP financial measures is available at the end of the company’s press release.
Comparable restaurant sales at The Cheesecake Factory increased by 1.4% year-over-year in Q2 2024.
“Building on our first quarter momentum, we delivered solid top- and bottom-line results in the second quarter, contributing to a strong performance in the first half of the year,” said David Overton, Chairman and CEO. “Our second quarter revenue finished towards the higher end of our expectations, and we generated robust earnings growth with profit margins exceeding the high end of our expectations. The strength of The Cheesecake Factory restaurants and resilient consumer demand for our unique, high-quality dining experiences supported our continued outperformance of the broader casual dining industry. Our operators achieved year-over-year improvements in labor productivity and staff and manager retention.”
The company opened five new restaurants in Q2 2024 across various concepts and markets, demonstrating strong demand and sales performance. With 11 restaurants opened to date, the company is on track to meet its goal of opening up to 22 new restaurants in 2024. Overton highlighted the consistent results, strong operational execution, and significant profitability growth.
Development
In Q2 2024, The Cheesecake Factory opened five new restaurants: one Cheesecake Factory, one North Italia, two Flower Child locations, and one Culinary Dropout. Additionally, one Cheesecake Factory restaurant opened in China under a licensing agreement. After the quarter ended, the company opened one Blanco location.
The company expects to open up to 22 new restaurants in fiscal 2024, including up to three Cheesecake Factory restaurants, six to seven North Italia restaurants, six to seven Flower Child locations, and seven to eight other Fox Restaurant Concept locations.
Liquidity and Capital Allocation
As of July 2, 2024, The Cheesecake Factory had $277.2 million in available liquidity, including a $40.7 million cash balance and $236.5 million available on its revolving credit facility. The total principal amount of debt outstanding was $475.0 million, including $345.0 million in principal amount of 0.375% convertible senior notes due 2026 and $130.0 million drawn on the company’s revolving credit facility.
In Q2 2024, the company repurchased approximately 111,400 shares of its stock at a cost of $3.9 million. Additionally, the Board of Directors declared a quarterly dividend of $0.27 per share, to be paid on August 27, 2024, to shareholders of record at the close of business on August 14, 2024.
