BJ's Restaurants, Inc. reported financial results for its fiscal 2014 second quarter that ended Tuesday, July 1, 2014.
Second Quarter 2014 Highlights:
- Total revenues increased 10.5 percent to $219.4 million
- Total restaurant operating weeks increased 13 percent
- Comparable restaurant sales declined 1.7 percent
- 2014 restaurant development plan proceeding on schedule, with the second quarter opening of three new restaurants and sustained plans to open six additional restaurants in the second half of fiscal 2014, all of which will be the company's new 7,400-square-foot prototype
"We are pleased with the progress achieved during the second quarter on our strategic initiatives to reignite sales and improve our operating performance," says Greg Trojan, president and chief executive officer. "Our initiatives to leverage our industry-leading guest traffic levels, improve kitchen efficiencies, and manage operating and occupancy costs, combined with the launch of our new menu and branding programs, all contributed to BJ's solid second quarter operating results.
"New menu items such as our Kale and Roasted Brussels Sprouts Salad and our Mediterranean Chicken Pita Tacos have become guest favorites within their respective categories and highlight the value, innovation, and quality of the BJ's menu and dining experience. Reflecting the success of the new menu and our branding campaign, comparable restaurant sales improved on a quarterly sequential basis and BJ's finished the quarter on a strong note with positive guest traffic for June, which benefited from a successful graduation season, Father's Day and the World Cup."
"The improved sales trends in the latter part of the quarter, combined with progress on our efficiency, productivity, and cost savings initiatives, resulted in restaurant-level cash flow margins and operating margins exceeding the expectations we set at the time we reported first quarter results in early May. Our second quarter restaurant-level cash flow margins of 18.6 percent represent the second consecutive quarterly improvement in this metric and while we've made meaningful progress to improve margins in 2014, we remain focused on attaining restaurant-level margins at our historic level of at least 19 percent," added Trojan.
In the second quarter of 2014, BJ's opened three new restaurants in Katy, Texas, and Orlando and Palm Beach, Florida, and closed a smaller format Pizza & Grill legacy restaurant in Belmont Shore, California, when its lease expired. The company plans to open three new restaurants during the third quarter and three new restaurants during the fourth quarter, thereby achieving its targeted opening of 11 new restaurants and an approximate 11 percent increase in operating weeks for fiscal 2014.
"Our next new restaurant is scheduled to open in Oviedo, Florida, in mid-August and will represent our first new 7,400-square-foot restaurant prototype, which is expected to cost approximately $1 million less than our current prototype while achieving a comparable level of sales productivity," Trojan says. "Our development team is now focused on finalizing our planned fiscal 2015 restaurant openings and is building a solid pipeline for fiscal 2016. We currently anticipate expanding our operating base by approximately 10 percent in fiscal 2015 with the opening of at least 15 new restaurants."