Cheesecake Factory Profit Misses Wall Street ForecastsWednesday, October 19, 2011
Cheesecake Factory Inc. late Wednesday said that despite higher revenue, its fiscal third quarter earnings fell 6 percent after Hurricane Irene hurt sales at East Coast restaurants.
After the markets closed, the Calabasas operator of the Cheesecake Factory and Grand Lux Café casual dining chains reported net income of $20.6 million (36 cents a share) for the quarter ended Sept. 27, compared with $22 million (37 cents) in the same period a year earlier.
Revenue rose 2.3 percent to more than $430 million, with expenses up 3 percent. The company also spent $50 million to repurchase nearly 1.8 million shares of stock.
Analysts surveyed by Thomson Reuters on average were expecting profit of 38 cents a share on revenue of $435 million.
The company, which operates 168 restaurants and two commercial bakeries, saw that were it not for the August hurricane, sales at its existing restaurants would have increased 1.2 percent. The company also has opened five restaurants this year, and is set to open a suburban New York location tomorrow.
“Our new restaurants are opening to long wait times and above-average sales volumes, further contributing to our growth,” said Chief Executive David Overton in a statement. “In addition, we are managing our business well in this environment.”
Shares earlier closed down 37 cents, or 2.6 percent, to $13.97 on the Nasdaq.