BJ's Restaurants Inc.
) reported second-quarter 2012 adjusted earnings of 32 cents per
share, in line with the Zacks Consensus Estimate and above the
prior-year earnings of 29 cents a share. On a GAAP basis, earnings
came at 31 cents per share versus 28 cents recorded in the year-ago
period. The year-over-year upside was attributable to double-digit
growth in the top line.
Inside the Headline Numbers
Revenues in the reported quarter grew 18.0% year over year to
$180.7 million which beat the Zacks Consensus Estimate of $180.0
million. The increase was attributable to modest increases in both
comparable restaurant sales and new restaurant openings. Comparable
restaurant sales grew 4.4% compared with 6.9% in the prior-year
Operating margin was down 10 basis points (bps) year over year
at 6.8%, reflecting a 10-bp hike in cost of sales, 20-bp spike in
occupancy and operating costs, 20-bp increase in depreciation and
amortization and 30-bp rise in restaurant opening costs. These were
partially offset by a fall of 20 bps in general and administrative
expenses and flat labor and benefits costs.
The company opened 5 restaurants during the second quarter. At
quarter-end, the company operated 122 units.
BJ's has already chalked out its unit opening plan for the next
two quarters of 2012. Five new units are slated for the third
quarter (Of which one has already been unveiled at Wichita, Kansas)
while the fourth quarter will see four openings.
BJ's ended the quarter with cash and cash equivalents of $33.6
million and shareholders equity of $353.9 million. As of July 3,
2012, BJ's long-term debt liability was nil.
BJ's sustained its top-line growth momentum on the back of
operating efficiencies, innovative offerings, several
sales-building initiatives and expansion policy, which have helped
the casual dining restaurant operator to drive traffic. However,
higher cost structure mainly related to payroll taxes and marketing
spend as well as an increased level of pre-opening costs is
expected in 2012.
BJ's Restaurants competes with
Darden Restaurants Inc.
) and currently retains the Zacks #3 Rank, which translates into a
short-term 'Hold' rating. We are maintaining our long-term Neutral
recommendation on the stock.
BJ'S RESTAURANT (BJRI): Free Stock Analysis
DARDEN RESTRNT (DRI): Free Stock Analysis
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