The Cheesecake Factory closed, or partially shuttered, 87 restaurants this past weekend as protests broke out across the country in the wake of George Floyd’s death.
The impact helped drive down same-store sales 63 percent in Q2 to date through May 31, the company said Tuesday in a business update.
The Cheesecake Factory began to reopen dining rooms across its concepts, which include North Italia and a collection within the Fox Restaurant Concepts subsidiary, the second week of May. As of Tuesday, about 25 percent of the company’s units, including 34 Cheesecake Factorys, were back on line with limited capacity dining rooms.
So far, these units have recaptured, on average, roughly 75 percent of prior-year sales, the company noted, “reflecting continued strength in off-premises sales and building dine-in business.”
For those Cheesecake Factory restaurants still running on takeout and delivery only, current weekly off-premises sales would equate to nearly $4 million per unit on an annualized basis, on average.
This mirrors the brand’s performance in May’s Q1 recap, when same-store sales rose 3 percent through February before falling 46 percent in March. In all, they dropped 12.9 percent in the period.
Throughout the pandemic, though, Cheesecake Factory saw its off-premises sales double, resulting in the $4 million mark it mentioned, which, notably, is the cash-flow breakeven point, CFO Matt Clark said. Yet it remains significantly reduced from pre-coronavirus levels. Cheesecake Factory stores averaged $10.7 million in sales per restaurant in 2019 and 2018, and $10.6 million the year before that.
In the early days of COVID-19, the chain was closer to the $3 million range, or roughly a quarter of the business it typically sees. So getting to 75 percent of prior-year sales at limited dine-in venues is a significant step forward.
If the second week of May sounds late for a national chain reopening, Cheesecake Factory planned it that way. The company previously noted it would take an extra week or two once jurisdictions lift to evaluate response. And it was only interested in 50 percent capacity options where customers could come in and recognize the experience. No menu cuts involved.
In April, the brand said it expected 10–15 percent of total capacity up and running by the end of May, with a steady cadence of reopenings through June. It’s right on that schedule.
Cheesecake Factory said Tuesday it plans to have about 65 percent of dining rooms across its concepts that closed due to COVID-19 reopened with limited seating by mid-June, including an anticipated 124 Cheesecake Factory restaurants. This could still be affected, the company admitted, by “further demonstrations and other factors related to the ongoing COVID-19 pandemic.”