Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Jan. 03, 2017 | Feb. 22, 2017 | Jun. 28, 2016 | |
Document and Entity Information | |||
Entity Registrant Name | CHEESECAKE FACTORY INC | ||
Entity Central Index Key | 887,596 | ||
Document Type | 10-K | ||
Document Period End Date | Jan. 3, 2017 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --01-03 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Public Float | $ 2,102,161,347 | ||
Entity Common Stock, Shares Outstanding | 47,725,557 | ||
Document Fiscal Year Focus | 2,016 | ||
Document Fiscal Period Focus | FY |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Jan. 03, 2017 | Dec. 29, 2015 |
Current assets: | ||
Cash and cash equivalents | $ 53,839 | $ 43,854 |
Accounts receivable | 15,632 | 14,159 |
Income tax receivable | 18,739 | |
Other receivables | 64,592 | 72,658 |
Inventories | 34,926 | 34,010 |
Prepaid expenses | 52,438 | 41,976 |
Total current assets | 221,427 | 225,396 |
Property and equipment, net | 910,134 | 892,191 |
Other assets: | ||
Intangible assets, net | 23,054 | 21,972 |
Prepaid rent | 42,162 | 46,881 |
Other | 96,542 | 46,906 |
Total other assets | 161,758 | 115,759 |
Total assets | 1,293,319 | 1,233,346 |
Current liabilities: | ||
Accounts payable | 41,564 | 47,770 |
Income taxes payable | 2,299 | |
Gift card liability | 153,629 | 144,143 |
Other accrued expenses | 179,034 | 158,313 |
Total current liabilities | 376,526 | 350,226 |
Deferred income taxes | 82,401 | 82,524 |
Deferred rent | 71,575 | 72,911 |
Deemed landlord financing liability | 100,576 | 87,841 |
Other noncurrent liabilities | 59,034 | 51,305 |
Commitments and contingencies (Note 10) | ||
Stockholders' equity: | ||
Preferred stock, $.01 par value, 5,000,000 shares authorized; none issued | ||
Common stock, $.01 par value, 250,000,000 shares authorized; 94,672,037 and 93,126,667 shares issued at January 3, 2017 and December 29, 2015, respectively | 947 | 931 |
Additional paid-in capital | 774,137 | 710,242 |
Retained earnings | 1,238,012 | 1,140,788 |
Treasury stock 46,979,659 and 44,064,322 shares at cost at January 3, 2017 and December 29, 2015, respectively | (1,409,889) | (1,263,422) |
Total stockholders' equity | 603,207 | 588,539 |
Total liabilities and stockholders' equity | $ 1,293,319 | $ 1,233,346 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Jan. 03, 2017 | Dec. 29, 2015 |
CONSOLIDATED BALANCE SHEETS | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, shares issued | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 250,000,000 | 250,000,000 |
Common stock, shares issued | 94,672,037 | 93,126,667 |
Treasury stock, shares | 46,979,659 | 44,064,322 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Jan. 03, 2017 | Dec. 29, 2015 | Dec. 30, 2014 | |
CONSOLIDATED STATEMENTS OF INCOME | |||
Revenues | $ 2,275,719 | $ 2,100,609 | $ 1,976,624 |
Costs and expenses: | |||
Cost of sales | 526,628 | 504,031 | 490,306 |
Labor expenses | 759,998 | 684,818 | 646,102 |
Other operating costs and expenses | 540,365 | 500,640 | 478,504 |
General and administrative expenses | 146,042 | 137,402 | 119,094 |
Depreciation and amortization expenses | 88,010 | 85,563 | 82,835 |
Impairment of assets and lease terminations | 114 | 6,011 | 696 |
Preopening costs | 13,569 | 16,898 | 14,356 |
Total costs and expenses | 2,074,726 | 1,935,363 | 1,831,893 |
Income from operations | 200,993 | 165,246 | 144,731 |
Interest and other expense, net | (9,225) | (5,894) | (6,187) |
Income before income taxes | 191,768 | 159,352 | 138,544 |
Income tax provision | 52,274 | 42,829 | 37,268 |
Net income | $ 139,494 | $ 116,523 | $ 101,276 |
Net income per share: | |||
Basic (in dollars per share) | $ 2.91 | $ 2.39 | $ 2.04 |
Diluted (in dollars per share) | $ 2.83 | $ 2.30 | $ 1.96 |
Weighted average shares outstanding: | |||
Basic (in shares) | 47,981 | 48,833 | 49,567 |
Diluted (in shares) | 49,372 | 50,605 | 51,584 |
Cash dividends declared per common share (in dollars per share) | $ 0.88 | $ 0.73 | $ 0.61 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) shares in Thousands, $ in Thousands | Common Stock | Additional Paid-in Capital | Retained Earnings | Treasury Stock | Total |
Balance at Dec. 31, 2013 | $ 906 | $ 602,469 | $ 989,451 | $ (1,015,473) | $ 577,353 |
Balance (in shares) at Dec. 31, 2013 | 90,632 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Net income | 101,276 | 101,276 | |||
Cash dividends declared | (30,516) | (30,516) | |||
Tax impact of stock options exercised, net of cancellations | 8,906 | 8,906 | |||
Stock-based compensation | 17,033 | 17,033 | |||
Common stock issued under stock-based compensation plans | $ 12 | 22,929 | 22,941 | ||
Common stock issued under stock-based compensation plans (in shares) | 1,158 | ||||
Treasury stock purchases | 2,696 | (143,179) | (140,483) | ||
Balance at Dec. 30, 2014 | $ 918 | 654,033 | 1,060,211 | (1,158,652) | 556,510 |
Balance (in shares) at Dec. 30, 2014 | 91,790 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Net income | 116,523 | 116,523 | |||
Cash dividends declared | (35,946) | (35,946) | |||
Tax impact of stock options exercised, net of cancellations | 12,501 | 12,501 | |||
Stock-based compensation | 20,325 | 20,325 | |||
Common stock issued under stock-based compensation plans | $ 13 | 27,984 | 27,997 | ||
Common stock issued under stock-based compensation plans (in shares) | 1,337 | ||||
Treasury stock purchases | (4,601) | (104,770) | (109,371) | ||
Balance at Dec. 29, 2015 | $ 931 | 710,242 | 1,140,788 | (1,263,422) | 588,539 |
Balance (in shares) at Dec. 29, 2015 | 93,127 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Net income | 139,494 | 139,494 | |||
Cash dividends declared | (42,270) | (42,270) | |||
Tax impact of stock options exercised, net of cancellations | 13,722 | 13,722 | |||
Stock-based compensation | 21,811 | 21,811 | |||
Common stock issued under stock-based compensation plans | $ 16 | 28,362 | 28,378 | ||
Common stock issued under stock-based compensation plans (in shares) | 1,545 | ||||
Treasury stock purchases | (146,467) | (146,467) | |||
Balance at Jan. 03, 2017 | $ 947 | $ 774,137 | $ 1,238,012 | $ (1,409,889) | $ 603,207 |
Balance (in shares) at Jan. 03, 2017 | 94,672 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 03, 2017 | Dec. 29, 2015 | Dec. 30, 2014 | |
Cash flows from operating activities: | |||
Net income | $ 139,494 | $ 116,523 | $ 101,276 |
Adjustments to reconcile net income to cash provided by operating activities: | |||
Depreciation and amortization expenses | 88,010 | 85,563 | 82,835 |
Deferred income taxes | (1,005) | 1,184 | 204 |
Impairment of assets and lease terminations | 114 | 6,011 | 245 |
Stock-based compensation | 21,473 | 20,053 | 16,817 |
Tax impact of stock options exercised, net of cancellations | 13,722 | 12,501 | 8,906 |
Excess tax benefit related to stock options exercised | (13,861) | (12,309) | (8,861) |
Other | 3,592 | 2,615 | 2,059 |
Changes in assets and liabilities: | |||
Accounts receivable | (1,473) | 1,011 | (5,079) |
Other receivables | 8,066 | (10,331) | (6,867) |
Inventories | (916) | (755) | 2,223 |
Prepaid expenses | (10,462) | (3,743) | 4,362 |
Other assets | (2,818) | (5,799) | (3,645) |
Accounts payable | 752 | (12,931) | 18,180 |
Income taxes receivable/payable | 21,837 | (1,356) | (12,854) |
Other accrued expenses | 35,995 | 37,186 | 39,848 |
Cash provided by operating activities | 302,520 | 235,423 | 239,649 |
Cash flows from investing activities: | |||
Additions to property and equipment | (115,821) | (153,941) | (113,982) |
Additions to intangible assets | (1,640) | (1,760) | (1,879) |
Investments in unconsolidated affiliates | (42,000) | ||
Cash used in investing activities | (159,461) | (155,701) | (115,861) |
Cash flows from financing activities: | |||
Deemed landlord financing proceeds | 17,246 | 14,266 | 14,143 |
Deemed landlord financing payments | (3,721) | (3,118) | (2,650) |
Borrowings on credit facility | 35,000 | 60,000 | 25,000 |
Repayments on credit facility | (35,000) | (60,000) | (25,000) |
Proceeds from exercise of stock options | 28,378 | 27,997 | 22,940 |
Excess tax benefit related to stock options exercised | 13,861 | 12,309 | 8,861 |
Cash dividends paid | (42,371) | (35,969) | (30,332) |
Treasury stock purchases | (146,467) | (109,371) | (140,483) |
Cash used in financing activities | (133,074) | (93,886) | (127,521) |
Net change in cash and cash equivalents | 9,985 | (14,164) | (3,733) |
Cash and cash equivalents at beginning of period | 43,854 | 58,018 | 61,751 |
Cash and cash equivalents at end of period | 53,839 | 43,854 | 58,018 |
Supplemental disclosures: | |||
Interest paid | 6,038 | 6,057 | 5,430 |
Income taxes paid | 17,932 | 30,410 | 41,074 |
Construction payable | $ 6,541 | $ 13,500 | $ 10,124 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Jan. 03, 2017 | |
Summary of Significant Accounting Policies | |
Summary of Significant Accounting Policies | 1. Summary of Significant Accounting Policies Description of Business As of March 2, 2017, The Cheesecake Factory Incorporated operated 208 Company-owned upscale casual dining restaurants under The Cheesecake Factory ® , Grand Lux Cafe ® and Rock Sugar Pan Asian Kitchen ® marks. Internationally, 15 The Cheesecake Factory branded restaurants operated in the Middle East, China and Mexico under licensing agreements. We also operated two bakery production facilities that produce desserts for our restaurants, international licensees and third-party bakery customers. We are selectively pursuing other means to leverage our competitive strengths, including developing, investing in or acquiring new restaurant concepts and expanding The Cheesecake Factory brand to other retail opportunities. Basis of Presentation The accompanying consolidated financial statements include the accounts of The Cheesecake Factory Incorporated and its wholly owned subsidiaries (referred to herein as the “Company,” “we,” “us” and “our”) prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). All intercompany accounts and transactions for the periods presented have been eliminated in consolidation. We utilize a 52/53-week fiscal year ending on the Tuesday closest to December 31 for financial reporting purposes. Fiscal years 2015 and 2014 each consisted of 52 weeks, while fiscal 2016 consisted of 53 weeks. Fiscal year 2017 will consist of 52 weeks. In fiscal 2016, we separately disclosed our gift card liability on the consolidated balance sheet. To conform to the current year presentation, we reclassified the prior year balance that was previously combined in other accrued expenses. Use of Estimates The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions for the reporting periods covered by the financial statements. These estimates and assumptions affect the reported amounts of assets, liabilities, revenues and expenses, and the disclosure of contingent liabilities. Actual results could differ from these estimates. Cash and Cash Equivalents Amounts receivable from credit card processors, totaling $12.2 million and $10.3 million at January 3, 2017 and December 29, 2015, respectively, are considered cash equivalents because they are both short-term and highly liquid in nature and are typically converted to cash within three days of the sales transaction. Checks issued, but not yet presented for payment to our bank, are reflected as a reduction of cash and cash equivalents. Accounts and Other Receivables Our accounts receivable principally result from credit sales to bakery customers. Other receivables consist of various amounts due from our gift card resellers, insurance providers, landlords and others in the ordinary course of business. Concentration of Credit Risk Financial instruments that potentially subject us to a concentration of credit risk are cash and cash equivalents and receivables. We maintain our day-to-day operating cash balances in non-interest-bearing transaction accounts, which are insured by the Federal Deposit Insurance Corporation (“FDIC”) up to $250,000. We invest our excess cash in a money market deposit account, which is insured by the FDIC up to $250,000. Although we maintain balances that exceed the federally insured limit, we have not experienced any losses related to this balance, and we believe credit risk to be minimal. We consider the concentration of credit risk for accounts receivable to be minimal due to the payment histories and general financial condition of our larger bakery customers. Concentration of credit risk related to other receivables is limited as this balance is comprised primarily of amounts due from our gift card resellers, insurance providers and landlords for the reimbursement of tenant improvements. Fair Value of Financial Instruments For cash and cash equivalents, the carrying amount approximates fair value because of the short maturity of these instruments. The fair value of deemed landlord financing liabilities is determined using current applicable rates for similar instruments as of the balance sheet date in accordance with Level 2 of a three-level hierarchy established by accounting standards. Level 2 inputs are observable for the asset or liability, either directly or indirectly, including quoted prices in active markets for similar assets or liabilities. At January 3, 2017, the fair value of our deemed landlord financing liabilities is $102.2 million versus a carrying value of $104.9 million. Inventories Inventories consist of restaurant food and other supplies, bakery raw materials, and bakery finished goods and are stated at the lower of cost or market on an average cost basis at the restaurants and on a first-in, first-out basis at the bakeries. Property and Equipment We record property and equipment at cost less accumulated depreciation. Improvements are capitalized while repairs and maintenance costs are expensed as incurred. Depreciation and amortization are calculated using the straight-line method over the estimated useful life of the assets or the lease term, whichever is shorter. Leasehold improvements include the cost of our internal development and construction department. Depreciation and amortization periods are as follows: Buildings and land improvements 25 to 30 years Leasehold improvements 10 to 30 years Furnishings, fixtures and equipment 3 to 15 years Computer software and equipment 5 years Gains and losses related to property and equipment disposals are recorded in interest and other expenses, net. Indefinite-Lived Assets Our trademarks and transferable alcoholic beverage licenses have indefinite lives and, therefore, are not subject to amortization. At January 3, 2017 and December 29, 2015, the amounts included in intangibles, net for these items were $14.6 million and $13.8 million, respectively. We test these assets for impairment at least annually by comparing the fair value of each asset with its carrying amount. Impairment of Long-Lived Assets and Lease Terminations We assess the potential impairment of our long-lived assets whenever events or changes in circumstances indicate the carrying value of the assets or asset group may not be recoverable. Factors considered include, but are not limited to, significant underperformance relative to historical or projected future operating results, significant changes in the manner in which an asset is being used, an expectation that an asset will be disposed of significantly before the end of its previously estimated useful life and significant negative industry or economic trends. We regularly review restaurants that are cash flow negative for the previous four quarters and those that are being considered for closure or relocation to determine if impairment testing is warranted. At any given time, we may be monitoring a small number of locations, and future impairment charges could be required if individual restaurant performance does not improve or we make the decision to close or relocate a restaurant. We have determined that our asset group for impairment testing is comprised of the assets and liabilities of each of our individual restaurants, as this is the lowest level of identifiable cash flows. We have identified leasehold improvements as the primary asset because it is the most significant component of our restaurant assets, it is the principal asset from which our restaurants derive their cash flow generating capacity and it has the longest remaining useful life. The recoverability is assessed in most cases by comparing the carrying value of the assets to the undiscounted cash flows expected to be generated by these assets. Impairment losses are measured as the amount by which the carrying values of the assets exceed their fair values. During fiscal 2016, we incurred $0.1 million of accelerated depreciation expense related to the planned relocation of one The Cheesecake Factory restaurant and we expect to incur an additional $1.2 million of accelerated depreciation and impairment expense related to this relocation in fiscal 2017. During fiscal 2015, we incurred $6.0 million of impairment expense against the carrying value of our Rock Sugar Pan Asian Kitchen restaurant assets. In fiscal 2014, we incurred $0.7 million of accelerated depreciation, future rent and other closing costs related to the relocation of one The Cheesecake Factory restaurant. These amounts were recorded in impairment of assets and lease terminations. Investments in Unconsolidated Affiliates During the fourth quarter of fiscal 2016, we made initial minority equity investments in two restaurant concepts, North Italia and Flower Child. Since we hold a number of rights with regard to participation in policy-making processes, but do not control these entities, we account for these investments under the equity method. We recognize our proportionate share of the reported earnings or losses of these entities in interest and other expense, net on the consolidated statements of income and as an adjustment to other assets on the consolidated balance sheets. Revenue Recognition Our revenues consist of sales from our restaurant operations, sales from our bakery operations to our licensees and other third-party customers and royalties on our licensees’ restaurant sales. Revenues from restaurant sales are recognized when payment is tendered at the point of sale. Revenues from bakery sales are recognized upon transfer of title and risk to customers. Royalties from international licensees are accrued as revenues when earned. Revenues are presented net of sales taxes. Sales tax collected is included in other accrued expenses until the taxes are remitted to the appropriate taxing authorities. We recognize a liability upon the sale of our gift cards and recognize revenue when these gift cards are redeemed in our restaurants. Based on our historical redemption patterns, we can reasonably estimate the amount of gift cards for which redemption is remote, which is referred to as “breakage.” Breakage is recognized over a three-year period in proportion to historical redemption trends and is classified as revenues in our consolidated statements of income. We recognized $7.6 million, $6.6 million and $5.4 million of gift card breakage in fiscal years 2016, 2015 and 2014, respectively. Incremental direct costs related to gift card sales, including commissions and credit card fees, are deferred and recognized in earnings in the same pattern as the related gift card revenue. Certain of our promotional programs include multiple element arrangements that incorporate both delivered and undelivered components. We allocate revenue using the relative selling price of each deliverable and recognize it upon delivery of each component. Leases We currently lease all of our restaurant locations. We evaluate each lease to determine its appropriate classification as an operating or capital lease for financial reporting purposes. All of our restaurant leases are classified as operating leases. Minimum base rent, which generally escalates over the term of the lease, is recorded on a straight-line basis over the lease term. The initial lease term includes the build-out, or rent holiday, period for our leases, where no rent payments are typically due under the terms of the lease. Contingent rent expense, which is based on a percentage of revenues, is recorded as incurred to the extent it exceeds minimum base rent per the lease agreement. We expend cash for leasehold improvements and furnishings, fixtures and equipment to build out and equip our leased premises. We may also expend cash for structural additions that we make to leased premises. Generally a portion of the leasehold improvements and building costs are reimbursed to us by our landlords as construction contributions. If obtained, landlord construction contributions usually take the form of up-front cash, full or partial credits against our future minimum or percentage rents, or a combination thereof. Depending on the specifics of the leased space and the lease agreement, amounts paid for structural components are recorded during the construction period as either prepaid rent or property and equipment and the landlord construction contributions are recorded as either an offset to prepaid rent or as a deemed landlord financing liability. For those leases for which we are deemed the owner of the property during construction, upon completion, we perform an analysis to determine if they qualify for sale-leaseback treatment. For those qualifying leases, the deemed landlord financing liability and the associated property and equipment are removed and the difference is reclassified to either prepaid or deferred rent and amortized over the lease term as an increase or decrease to rent expense. If the lease does not qualify for sale-leaseback treatment, the deemed landlord financing liability is amortized over the lease term based on the rent payments designated in the lease agreement. Self-Insurance Liabilities We retain the financial responsibility for a significant portion of our risks and associated liabilities with respect to workers’ compensation, general liability, employee health benefits, employment practices and other insurable risks. The accrued liabilities associated with our self-insured programs are based on our estimate of the ultimate costs to settle known claims as well as claims incurred but not yet reported to us (“IBNR”) as of the balance sheet date and are recorded in other accrued expenses. Our estimated liabilities are not discounted and are based on information provided by our insurance brokers and insurers, combined with our judgment regarding a number of assumptions and factors, including the frequency and severity of claims, claims development history, case jurisdiction, applicable legislation and our claims settlement practices. We maintain stop-loss coverage with third-party insurers to limit our individual claim exposure for many of our programs. The estimated amounts receivable from our third-party insurers under this coverage are recorded in other receivables. Stock-Based Compensation We maintain stock-based incentive plans under which equity awards may be granted to employees and consultants. We account for the awards based on fair value measurement guidance and amortize to expense over the vesting period using a straight-line or graded-vesting schedule, as applicable. We reclassify the excess tax benefit resulting from the exercise of stock options out of cash flows from operating activities and into cash flows from financing activities on the consolidated statements of cash flows. See Note 12 for further discussion of our stock-based compensation. Advertising Costs We expense advertising production costs at the time the advertising first takes place. All other advertising costs are expensed as incurred. Most of our advertising costs are included in other operating costs and expenses and were $7.4 million, $5.0 million and $6.2 million in fiscal 2016, 2015 and 2014, respectively. Preopening Costs Preopening costs include all costs to relocate and compensate restaurant management employees during the preopening period, costs to recruit and train hourly restaurant employees, and wages, travel and lodging costs for our opening training team and other support staff members. Also included are expenses for maintaining a roster of trained managers for pending openings, the associated temporary housing and other costs necessary to relocate managers in alignment with future restaurant opening and operating needs, and corporate travel and support activities. We expense preopening costs as incurred. Income Taxes We provide for federal, state and foreign income taxes currently payable and for deferred taxes that result from differences between financial accounting rules and tax laws governing the timing of recognition of various income and expense items. We recognize deferred income tax assets and liabilities for the future tax effects of such temporary differences based on the difference between the financial statement and tax bases of existing assets and liabilities using the statutory rates expected in the years in which the differences are expected to reverse. The effect on deferred taxes of any enacted change in tax rates is recognized in income in the period that includes the enactment date. Income tax credits are recorded as a reduction of tax expense. We account for uncertain tax positions under Financial Accounting Standards Board (“FASB”) guidance, which requires that a position taken or expected to be taken in a tax return be recognized (or derecognized) in the financial statements when it is more likely than not (i.e., a likelihood of more than 50%) that the position would be sustained on its technical merits upon examination by tax authorities, taking into account available administrative remedies and litigation. A recognized tax position is then measured at the largest amount of benefit that is greater than 50% likely of being realized upon ultimate resolution. We recognize interest related to uncertain tax positions in income tax expense. Penalties related to uncertain tax positions are recorded in general and administrative expenses. Net Income per Share Basic net income per share is computed by dividing net income available to common stockholders by the weighted average number of common shares outstanding during the period. At January 3, 2017, December 29, 2015 and December 30, 2014, 1.9 million, 1.9 million and 1.8 million shares, respectively, of restricted stock issued to employees were unvested and, therefore, excluded from the calculation of basic earnings per share for the fiscal years ended on those dates. Diluted net income per share includes the dilutive effect of outstanding equity awards, calculated using the treasury stock method. Assumed proceeds from the in-the-money options include the windfall tax benefits, net of shortfalls, calculated under the “as-if” method as prescribed by FASB Accounting Standards Codification 718, “Compensation — Stock Option Compensation.” Fiscal Year 2016 2015 2014 (In thousands, except per share data) Net income $ $ $ Basic weighted average shares outstanding Dilutive effect of equity awards Diluted weighted average shares outstanding Basic net income per share $ $ $ Diluted net income per share $ $ $ Shares of common stock equivalents of 1.4 million, 1.3 million and 1.0 million for fiscal 2016, 2015 and 2014, respectively, were excluded from the diluted calculation due to their anti-dilutive effect. Comprehensive Income Comprehensive income includes all changes in equity during a period except those resulting from investment by and distribution to owners. For fiscal years 2016, 2015 and 2014, our comprehensive income consisted solely of net income. Recent Accounting Pronouncements In March 2016, the FASB issued guidance affecting all entities that issue share-based payment awards to their employees. This update covers such areas as the recognition of excess tax benefits and deficiencies, the classification of those excess tax benefits on the statement of cash flows, an accounting policy election for forfeitures, the amount an employer can withhold to cover income taxes and still qualify for equity classification and the classification of those taxes paid on the statement of cash flows. This guidance is effective for annual and interim periods beginning after December 15, 2016. Although early adoption is permitted, we will adopt these provisions prospectively in the first quarter of fiscal 2017. These changes will impact our tax provision, cash flows from operating activities and cash flows from financing activities. We will continue to estimate forfeitures each period, so there will be no change associated with forfeitures. Excess tax benefits and deficiencies are heavily impacted by factors outside of our control such as the number of stock options exercised and the market price of our stock. For purposes of our Fiscal 2017 Outlook in Part II, Item 7 of this report, we estimated the implementation of this guidance to reduce our annual effective tax rate by a range of 3% to 4%. In February 2016, the FASB issued guidance that requires a lessee to recognize on the balance sheet a liability to make lease payments and a corresponding right-of-use asset. The standard also requires certain qualitative and quantitative disclosures about the amount, timing and uncertainty of cash flows arising from leases. This update is effective for annual and interim periods beginning after December 15, 2018 and requires a modified retrospective approach. Although early adoption is permitted, we will adopt these provisions in the first quarter of fiscal 2019. This guidance will have a material effect on our consolidated financial statements. In July 2015, the FASB issued guidance that requires inventory within the scope of the standard to be measured at the lower of cost or net realizable value. Previous guidance required inventory to be measured at the lower of cost or market (where market was defined as replacement cost, with a ceiling of net realizable value and floor of net realizable value less a normal profit margin). The updated guidance is effective for interim and annual reporting periods beginning after December 15, 2016, with early adoption permitted. We expect the adoption of this guidance to have no material impact on our consolidated financial statements. In April 2015, the FASB issued guidance regarding a customer’s accounting for fees paid in a cloud computing arrangement. If a cloud computing arrangement includes a software license, the customer should account for the software license element of the arrangement consistent with the acquisition of other software licenses. If a cloud computing arrangement does not include a software license, the customer should account for the arrangement as a service contract. This guidance was effective for fiscal years beginning after December 15, 2015, with early adoption permitted. Our adoption of this guidance in the first quarter of fiscal 2016 had no impact on our consolidated financial statements. In April 2015, the FASB issued updated guidance intended to simplify, and provide consistency to, the presentation of debt issuance costs. The new standard requires that debt issuance costs be presented in the balance sheet as a direct deduction from the carrying amount of the debt liability, consistent with debt discounts. In August 2015, the FASB provided additional guidance for presentation of debt issuance costs related to line-of-credit arrangements. The updated guidance was effective for interim and annual reporting periods beginning after December 15, 2015, with early adoption permitted. Our adoption of this guidance in the first quarter of fiscal 2016 had no impact on our consolidated financial statements. In February 2015, the FASB issued updated guidance that changes the analysis that a reporting entity must perform to determine whether it should consolidate certain types of legal entities. The updated guidance was effective for interim and annual reporting periods beginning after December 15, 2015, with early adoption permitted. Our adoption of this guidance in the first quarter of fiscal 2016 had no impact on our consolidated financial statements. In June 2014, the FASB issued updated guidance intended to eliminate the diversity in practice regarding share-based payment awards that include terms which provide for a performance target that affects vesting being achieved after the requisite service period. The new standard requires that a performance target which affects vesting and could be achieved after the requisite service period be treated as a performance condition that affects vesting and should not be reflected in estimating the grant-date fair value. The updated guidance was effective for interim and annual reporting periods beginning after December 15, 2015, with early adoption permitted. Our adoption of this guidance in the first quarter of fiscal 2016 had no impact on our consolidated financial statements. In May 2014, the FASB issued accounting guidance that provides a comprehensive new revenue recognition model that supersedes most of the existing revenue recognition requirements and require entities to recognize revenue at an amount that reflects the consideration to which a company expects to be entitled in exchange for transferring goods or services to a customer. In August 2015, the FASB deferred the effective date of this standard by one year with early adoption permitted no earlier than the original effective date. The guidance is now effective for us beginning in the first quarter of fiscal 2018. In March and April 2016, the FASB provided additional guidance related to implementation. This standard is not expected to have a material impact on our consolidated financial statements. |
Other Receivables
Other Receivables | 12 Months Ended |
Jan. 03, 2017 | |
Other Receivables | |
Other Receivables | 2. Other Receivables Other receivables consisted of (in thousands): January 3, 2017 December 29, 2015 Gift card resellers $ $ Insurance providers Landlord construction contributions Other Total $ $ |
Inventories
Inventories | 12 Months Ended |
Jan. 03, 2017 | |
Inventories | |
Inventories | 3. Inventories Inventories consisted of (in thousands): January 3, 2017 December 29, 2015 Restaurant food and supplies $ $ Bakery finished goods and work in progress Bakery raw materials and supplies Total $ $ |
Prepaid Expenses
Prepaid Expenses | 12 Months Ended |
Jan. 03, 2017 | |
Prepaid Expenses | |
Prepaid Expenses | 4. Prepaid Expenses Prepaid expenses consisted of (in thousands): January 3, 2017 December 29, 2015 Gift card costs $ $ Rent Other Total $ $ |
Property and Equipment
Property and Equipment | 12 Months Ended |
Jan. 03, 2017 | |
Property and Equipment | |
Property and Equipment | 5. Property and Equipment Property and equipment consisted of (in thousands): January 3, 2017 December 29, 2015 Land and related improvements $ $ Buildings Leasehold improvements Furnishings, fixtures and equipment Computer software and equipment Restaurant smallwares Construction in progress Property and equipment, total Less: Accumulated depreciation ) ) Property and equipment, net $ $ Depreciation expenses related to property and equipment for fiscal 2016, 2015 and 2014 were $88.0 million, $85.6 million and $82.4 million, respectively. Repair and maintenance expenses for fiscal 2016, 2015 and 2014 were $50.1 million, $44.9 million and $42.7 million, respectively. Net expense on property and equipment disposals of $3.6 million, $2.1 million and $2.0 million in fiscal 2016, 2015 and 2014, respectively, is recorded in interest and other expense, net in our consolidated statements of income. |
Other Assets
Other Assets | 12 Months Ended |
Jan. 03, 2017 | |
Other Assets | |
Other Assets | 6. Other Assets Other assets consisted of (in thousands): January 3, 2017 December 29, 2015 Executive Savings Plan assets trust $ $ Investments in unconsolidated affiliates — Deposits Total $ $ |
Other Accrued Expenses
Other Accrued Expenses | 12 Months Ended |
Jan. 03, 2017 | |
Other Accrued Expenses | |
Other Accrued Expenses | 7. Other Accrued Expenses Other accrued expenses consisted of (in thousands): January 3, 2017 December 29, 2015 Self-insurance $ $ Salaries and wages Employee benefits Payroll and sales taxes Other Total $ $ |
Long-Term Debt
Long-Term Debt | 12 Months Ended |
Jan. 03, 2017 | |
Long-Term Debt | |
Long-Term Debt | 8. Long-Term Debt On November 10, 2016, we entered into a loan agreement (“Facility”) which amended and restated in its entirety our prior loan agreement dated October 16, 2013. This Facility, which matures on December 22, 2020, provides us with revolving loan commitments totaling $200 million, of which $50 million may be used for issuances of letters of credit. Availability under the Facility is reduced by outstanding letters of credit, which are used to support our self-insurance programs. The Facility contains a commitment increase feature that could provide for an additional $100 million in available credit upon our request and subject to the lenders electing to increase their commitments or by means of the addition of new lenders. Our obligations under the Facility are unsecured. Certain of our material subsidiaries have guaranteed our obligations under the Facility. We borrowed on these credit facilities during fiscal 2016 to fund a portion of our investment in North Italia and Flower Child and our stock repurchases. We borrowed on these credit facilities during fiscal 2015 to fund a portion of our stock repurchases. Balances were repaid within each fiscal year. At January 3, 2017, we had net availability for borrowings of $178 million, based on a zero outstanding debt balance and $22.0 million in standby letters of credit. We are subject to certain financial covenants under the Facility requiring us to maintain (i) a maximum “Net Adjusted Leverage Ratio” of 4.0, comprised of debt plus eight times rent minus unrestricted cash and cash equivalents in excess of $25 million divided by “EBITDAR” (trailing 12-month earnings before interest, taxes, depreciation, amortization, noncash stock option expense, rent and permitted acquisition costs) and (ii) a trailing 12-month minimum EBITDAR to interest and rental expense ratio (“EBITDAR Ratio”) of 1.9. Our Net Adjusted Leverage and EBITDAR Ratios were 2.4 and 3.1, respectively, at January 3, 2017, and we were in compliance with the financial covenants in effect at that date. The Facility also limits cash distributions with respect to our equity interests, such as cash dividends and share repurchases, based on the Net Adjusted Leverage Ratio. Borrowings under the Facility bear interest, at our option, at a rate equal to either (i) the Adjusted LIBO Rate plus a margin ranging from 1.00% to 1.75% based on our Net Adjusted Leverage Ratio or (ii) the sum of (a) the highest of (1) the rate of interest publicly announced by JP Morgan Chase Bank as its prime rate in effect, (2) the greater of the Federal Funds Effective Rate or the Overnight Bank Funding Rate, in either case plus 0.5%, and (3) the one-month Adjusted LIBO Rate plus 1.0%, plus (b) a margin ranging from 0.00% to 0.75% based on our Net Adjusted Leverage Ratio. Under the Facility, we paid certain customary loan origination fees and will pay a fee on the unused portion of the Facility ranging from 0.125% to 0.25% also based on our Net Adjusted Leverage Ratio. We capitalized interest expense related to new restaurant openings and major remodels totaling $0.6 million, $1.6 million and $0.8 million in fiscal 2016, 2015 and 2014, respectively. |
Other Noncurrent Liabilities
Other Noncurrent Liabilities | 12 Months Ended |
Jan. 03, 2017 | |
Other Noncurrent Liabilities | |
Other Noncurrent Liabilities | 9. Other Noncurrent Liabilities Other noncurrent liabilities consisted of (in thousands): January 3, 2017 December 29, 2015 Executive Savings Plan $ $ Other Total $ $ See Note 13 for further discussion of our Executive Savings Plan. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Jan. 03, 2017 | |
Commitments and Contingencies | |
Commitments and Contingencies | 10. Commitments and Contingencies We currently lease all of our restaurant locations under operating leases, with remaining terms ranging from less than one year to 20 years, excluding unexercised renewal options. Our restaurant leases typically include land and building shells, require contingent rent above the minimum base rent payments based on a percentage of revenues ranging from 3% to 10%, have escalating minimum rent requirements over the term of the lease and require various expenses incidental to the use of the property. A majority of our leases provide for a reduced level of overall rent obligation should specified co-tenancy requirements not be satisfied. Most leases have renewal options. Many of our leases also provide early termination rights permitting us to terminate the lease prior to expiration in the event our revenues are below a stated level for a period of time, generally conditioned upon repayment of the unamortized allowances contributed by landlords to the build-out of the leased premises. We also lease automobiles and certain equipment under operating lease agreements. Rent expense is included in other operating costs and expenses in the consolidated statements of income. As of January 3, 2017, the aggregate minimum annual lease payments under operating leases, including amounts characterized as deemed landlord financing payments are as follows (in thousands): 2017 $ 2018 2019 2020 2021 Thereafter Total $ Rent expense on all operating leases was as follows (in thousands): Fiscal Year 2016 2015 2014 Straight-lined minimum base rent $ $ $ Contingent rent Common area maintenance and taxes Total $ $ $ We enter into various obligations for the purchase of goods and for the construction of restaurants. At January 3, 2017, these obligations approximated $142.1 million, $94.3 million of which is due in fiscal 2017. In addition, we are obligated to provide up to $42 million in combined growth capital to North Italia and Flower Child. These contributions will result in an increased minority interest in the related concept. The right, and obligation to provide growth capital and to acquire the remaining interest in either or both of these concepts in the next three to five years, assumes certain financial, legal and operational conditions are met. As credit guarantees to insurers, we have $22.0 million in standby letters of credit related to our self-insurance liabilities. All standby letters of credit are renewable annually. We retain the financial responsibility for a significant portion of our risks and associated liabilities with respect to workers’ compensation, general liability, employee health benefits, employment practices and other insurable risks. The accrued liabilities associated with these programs are based on our estimate of the ultimate costs to settle known claims as well as claims incurred but not yet reported to us (“IBNR”) as of the balance sheet date. Our estimated liabilities are not discounted and are based on information provided by our insurance brokers and insurers, combined with our judgment regarding a number of assumptions and factors, including the frequency and severity of claims, claims development history, case jurisdiction, applicable legislation and our claims settlement practices. We maintain stop-loss coverage with third-party insurers to limit our individual claim exposure for many of our programs. Significant judgment is required to estimate IBNR amounts, as parties have yet to assert such claims. If actual claims trends, including the severity or frequency of claims, differ from our estimates, our financial results could be impacted. At January 3, 2017, the total accrued liability for our self-insured plans was $64.1 million. On April 11, 2013, a former restaurant hourly employee filed a class action lawsuit in the California Superior Court, Placer County, alleging that the Company violated the California Labor Code and California Business and Professions Code, by requiring employees to purchase uniforms for work (Sikora v. The Cheesecake Factory Restaurants, Inc., et al; Case No SCV0032820). A similar lawsuit covering a different time period was also filed in Placer County (Reed v. The Cheesecake Factory Restaurants, Inc. et al; Case No. SCV27073). By stipulation the parties agreed to transfer the Reed and Sikora cases to Los Angeles County. Both cases were subsequently coordinated together in Los Angeles County by order of the Judicial Council. On November 15, 2013, the Company filed a motion to enforce judgment and to preclude the prosecution of certain claims under the California Private Attorney General Act (“PAGA”) and California Business and Professions Code Section 17200. On March 11, 2015, the court granted the Company’s motion in Case No. SCV0032820. The parties participated in voluntary mediation on June 25, 2015 and have executed a memorandum of understanding with respect to the terms of settlement, which is subject to court approval and is intended to be a full and final resolution of the actions. We expensed an immaterial amount for this settlement in the second quarter of fiscal 2015. On January 29, 2016, the court granted the parties’ Motion for Preliminary Approval of Class Action Settlement for Case Nos. SCV0032820 and SCV27073. On June 10, 2016, the court entered the order and judgment granting final approval of the class action settlement. Final payments under the settlement agreement were made in September 2016 following the end of the claims period. On November 26, 2014, a former restaurant hourly employee filed a class action lawsuit in the San Diego County Superior Court, alleging that the Company violated the California Labor Code and California Business and Professions Code, by failing to pay overtime, to permit required rest breaks and to provide accurate wage statements, among other claims (Masters v. The Cheesecake Factory Restaurants, Inc., et al; Case No 37-2014-00040278). By stipulation, the parties agreed to transfer Case No. 37-2014-00040278 to the Orange County Superior Court. On March 2, 2015, Case No. 37-2014-00040278 was officially transferred and assigned a new Case No. 30-2015-00775529 in the Orange County Superior Court. On June 27, 2016, we gave notice to the court that Case Nos. CIV1504091 and BC603620 described below may be related. The lawsuit seeks unspecified amounts of fees, penalties and other monetary payments on behalf of the Plaintiff and other purported class members. We intend to vigorously defend this action. Based on the current status of this matter, we have not reserved for any potential future payments. On May 28, 2015, a group of current and former restaurant hourly employees filed a class action lawsuit in the U.S. District Court for the Eastern District of New York, alleging that the Company violated the Fair Labor Standards Act and New York Labor Code, by requiring employees to purchase uniforms for work and violated the State of New York’s minimum wage and overtime provisions (Guglielmo v. The Cheesecake Factory Restaurants, Inc., et al; Case No 2:15-CV-03117). On September 8, 2015, the Company filed its response to the complaint, requesting the court to compel arbitration against opt-in plaintiffs with valid arbitration agreements. On July 21, 2016, the court issued an order confirming the agreement of the parties to dismiss all class claims with prejudice and to allow the case to proceed as a collective action at a limited number of the Company’s restaurants in the State of New York. The plaintiffs are seeking unspecified amounts of penalties and other monetary payments. We intend to vigorously defend this action. Based upon the current status of this matter, we have not reserved for any potential future payments. On November 10, 2015, a current restaurant hourly employee filed a class action lawsuit in the Marin County Superior Court alleging that the Company failed to provide complete and accurate wage statements as set forth in the California Labor Code. On January 26, 2016, the plaintiff filed a First Amended Complaint. The lawsuit seeks unspecified penalties under PAGA in addition to other monetary payments (Brown v. The Cheesecake Factory Restaurants, Inc.; Case No. CIV1504091). On April 18, 2016, the court granted our motion to compel individual arbitration of plaintiff’s wage statement claim and stayed the PAGA claim until completion of the individual arbitration. On June 28, 2016, we gave notice to the court that Case Nos. 30-2015-00775529 and BC603620 may be related. On September 6, 2016, the parties engaged in settlement discussion and are negotiating the terms of a final settlement agreement. On February 21, 2017, the court granted the parties’ motion for preliminary approval of class action settlement, and preliminarily enjoined the plaintiffs in Case Nos. 30-2015-00775529 and 37-2014-00040278 from prosecuting any claims released in Case No. CIV1504091. The final settlement agreement will be subject to court approval and is intended to be a full and final resolution of Case No. CIV150491. Based on the current status of this matter, we have reserved an immaterial amount in anticipation of settlement. On December 10, 2015, a former restaurant management employee filed a class action lawsuit in the Los Angeles County Superior Court alleging that the Company improperly classified its managerial employees, failed to pay overtime, and failed to provide accurate wage statements, in addition to other claims. The lawsuit seeks unspecified penalties under PAGA in addition to other monetary payments (Tagalogon v. The Cheesecake Factory Restaurants, Inc., Case No. BC603620). On March 23, 2016, the parties issued their joint status conference statement at which time we gave notice to the court that Case Nos. 30-2015-00775529 and CIV1504091 may be related. On April 29, 2016, the Company filed its response to the complaint. We intend to vigorously defend against this action. Based upon the current status of this matter, we have not reserved for any potential future payments. On April 24, 2016, a class action lawsuit was filed in the United States District Court for the Eastern District of New York alleging that the Company violated the New York deceptive business practices statute by improperly calculating suggested gratuities on split payment checks (Rodriguez v. The Cheesecake Factory Restaurants, Inc., Case No. 2:16-cv-02006-JFB-AKT). The lawsuit seeks unspecified penalties in addition to other monetary payments. On September 1, 2016, the Company filed a motion to dismiss the plaintiff’s complaint. On October 10, 2016, the plaintiff filed an amended complaint to limit the scope of the complaint to the State of New York only. The parties are waiting for a ruling on the Company’s motion to dismiss. We intend to vigorously defend against this action. Based upon the current status of this matter, we have not reserved for any potential future payments. On December 13, 2016, the Internal Revenue Service (“IRS”) issued a Notice of Proposed Adjustment (“NPA”) in which the IRS proposed a disallowance of a total of $12.9 million of our §199 Domestic Production Activity Deductions for tax years 2010, 2011 and 2012. On January 18, 2017, we responded to the NPA indicating we disagreed with the proposed adjustments, and we intend to request administrative review of the NPA by the IRS’s Appeals Division. We intend to vigorously defend our position and, based on our analysis of the law, regulations and relevant facts, we believe our position will be sustained. Based upon the current status of this matter, we have not reserved for any potential future payments. On February 3, 2017, a class action lawsuit was filed in the United States District Court for the Southern District of Florida alleging that the Company violated the Fair and Accurate Credit Transaction Act by failing to properly censor consumer credit or debit card information. (Muransky v. The Cheesecake Factory Incorporated, Case No. 0:17-cv-60229-JEM). The lawsuit seeks unspecified penalties in addition to other monetary payments. We intend to vigorously defend against this action. Based upon the current status of this matter, we have not reserved for any potential future payments. On February 3, 2017, five present and former restaurant hourly employees filed a class action lawsuit in the San Diego County Superior Court alleging that the Company violated the California Labor Code and California Business and Professions Code by failing to permit required meal and rest breaks and failing to provide accurate wage statements, among other claims. (Abdelaziz v. The Cheesecake Factory Restaurants, Inc., et al; Case No 37-2016-00039775-CU-OE-CTL). The lawsuit seeks unspecified penalties under PAGA in addition to other monetary payments on behalf of the plaintiffs and other purported class members. We intend to vigorously defend this action. Based on the current status of this matter, we have not reserved for any potential future payments. On February 22, 2017, a group of present and former restaurant hourly employees filed a class action lawsuit in the San Diego County Superior Court alleging that the Company violated the California Labor Code and California Business and Professions Code by failing to pay overtime, furnish proper wage statements, and maintain accurate payroll records, among other claims. (Rodriguez v. The Cheesecake Factory Restaurants, Inc., et al; Case No 37-2017-00006571-CU-OE-CTL). The lawsuit seeks unspecified penalties under PAGA in addition to other monetary payments on behalf of the plaintiffs and other purported class members. We intend to vigorously defend this action. Based on the current status of this matter, we have not reserved for any potential future payments. Within the ordinary course of our business, we are subject to private lawsuits, government audits, administrative proceedings and other claims. These matters typically involve claims from customers, staff members and others related to operational and employment issues common to the foodservice industry. A number of these claims may exist at any given time, and some of the claims may be pled as class actions. From time to time, we are also involved in lawsuits with respect to infringements of, or challenges to, our registered trademarks and other intellectual property, both domestically and abroad. We could be affected by adverse publicity and litigation costs resulting from such allegations, regardless of whether they are valid or whether we are legally determined to be liable. At this time, we believe that the final disposition of any pending lawsuits, audits, proceedings and claims will not have a material adverse effect individually or in the aggregate on our financial position, results of operations or liquidity. It is possible, however, that our future results of operations for a particular quarter or fiscal year could be impacted by changes in circumstances relating to lawsuits, audits, proceedings or claims. Legal costs related to such claims are expensed as incurred. We have employment agreements with certain of our executive officers that provide for payments to those officers in the event of an actual or constructive termination of their employment, including in the event of a termination without cause, an acquirer failure to assume or continue equity awards following a change in control of the Company or, otherwise, in the event of death or disability as defined in those agreements. Aggregate payments totaling approximately $2.2 million, excluding accrued potential bonuses of $3.1 million, which are subject to approval by the Compensation Committee, would have been required by those agreements had all such officers terminated their employment for reasons requiring such payments as of January 3, 2017. In addition, the employment agreement with our Chief Executive Officer, specifies an annual founder’s retirement benefit of $650,000 for ten years, commencing six months after termination of his full time employment. |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Jan. 03, 2017 | |
Stockholders' Equity | |
Stockholders' Equity | 11. Stockholders’ Equity Cash dividends of $0.88, $0.73 and $0.61 were declared during fiscal 2016, 2015 and 2014, respectively. Future decisions to pay or to increase or decrease dividends are at the discretion of the Board and will be dependent on our operating performance, financial condition, capital expenditure requirements, limitations on cash distributions pursuant to the terms and conditions of our Facility and such other factors that the Board considers relevant. On July 21, 2016, our Board increased the authorization to repurchase our common stock by 7.5 million shares to 56.0 million shares. Under this and all previous authorizations, we have cumulatively repurchased 47.0 million shares at a total cost of $1,409.9 million through January 3, 2017. During fiscal 2016, 2015 and 2014, we repurchased 2.9 million, 2.1 million and 3.1 million shares of our common stock at a cost of $146.5 million, $104.8 million and $143.2 million, respectively. Repurchased common stock is reflected as a reduction of stockholders’ equity. Our share repurchases have included repurchases under Rule 10b5-1 plans adopted from time to time by our Board in furtherance of its repurchase authorization. Repurchases made during fiscal 2016 were made under a Rule 10b5-1 plan that was adopted by our Board on November 3, 2015 that was effective from January 4, 2016 through June 30, 2016 and a 10b5-1 Plan approved on April 21, 2016, which was effective from July 1, 2016 through December 30, 2016. On October 20, 2016, our Board approved a 10b5-1 Plan, which is effective from January 3, 2017 through June 30, 2017. Our share repurchase authorization does not have an expiration date, does not require us to purchase a specific number of shares and may be modified, suspended or terminated at any time. Shares may be repurchased in the open market or through privately negotiated transactions at times and prices considered appropriate by us. Purchases in the open market are made in compliance with Rule 10b-18 under the Securities Exchange Act of 1934 (the “Act”). We make the determination to repurchase shares based on several factors, including an evaluation of current and future capital needs associated with new restaurant development, current and forecasted cash flows, including dividend payments and growth capital contributions to North Italia and Flower Child, a review of our capital structure and cost of capital, our share price and current market conditions. The timing and number of shares repurchased are also subject to legal constraints and financial covenants under our Facility that limit share repurchases based on a defined ratio. (See Note 8 for further discussion of our long-term debt.) Our objectives with regard to share repurchases are to offset the dilution to our shares outstanding that results from equity compensation grants and to supplement our earnings per share growth. On February 27, 2015, we entered into an accelerated stock repurchase (“ASR”) program with a financial institution to repurchase $75 million of our common stock. The minimum number of shares to be repurchased, 1.5 million, was delivered during March 2015. The program concluded on July 27, 2015 with no additional shares delivered. On February 27, 2014, we entered into an ASR agreement with a financial institution to repurchase $75 million of our common stock. The minimum number of shares to be repurchased, 1.4 million, was delivered in March 2014. Upon settlement of the 2014 ASR program, we received an additional 0.2 million shares on July 21, 2014. |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
Jan. 03, 2017 | |
Stock-Based Compensation | |
Stock-Based Compensation | 12. Stock-Based Compensation We maintain stock-based incentive plans under which incentive stock options, non-qualified stock options, stock appreciation rights, restricted shares and restricted share units may be granted to employees and consultants. Our current practice is to issue new shares, rather than treasury shares, upon stock option exercises and for restricted share grants. To date, we have only granted non-qualified stock options, restricted shares and restricted share units of common stock under these plans. Non-employee directors have received only non-qualified stock options under a non-employee director equity plan, which expired in May 2007. Currently, we do not have a plan under which non-employee directors may be granted stock options or other equity interests in the Company. On April 2, 2015, our Board approved an amendment to our 2010 Stock Incentive Plan to increase the number of shares of common stock available for grant under the plan to 9.2 million shares from 6.8 million shares. This amendment was approved by our stockholders at our annual meeting held on May 28, 2015. This is our only active stock-based incentive plan, and approximately 1.5 million of these shares were available for grant as of January 3, 2017. Stock options generally vest at 20% per year and expire eight to ten years from the date of grant. Restricted shares and restricted share units generally vest between three to five years from the date of grant and require that the staff member remains employed in good standing with the Company as of the vesting date. Certain restricted share units granted to executive officers contain performance-based vesting conditions. Performance goals are determined by the Board of Directors. The quantity of units that will vest ranges from 0% to 125% based on the level of achievement of the performance conditions. Equity awards for certain executive officers may vest earlier in the event of a change of control in which the acquirer fails to assume or continue such awards, as defined in the plan, or under certain circumstances described in such executive officers’ respective employment agreements. Since restricted shares and restricted share units provide strong retention power through economic value to our staff members even when our stock price remains flat or declines, and they also reduce our total share usage, we have generally increased the proportion of restricted shares and restricted share units versus stock option grants over the past several years. Compensation expense is recognized only for those options, restricted shares and restricted share units expected to vest, with forfeitures estimated based on our historical experience and future expectations. The following table presents information related to stock-based compensation, net of forfeitures (in thousands): Fiscal Year 2016 2015 2014 Labor expenses $ $ $ Other operating costs and expenses General and administrative expenses Total stock-based compensation Income tax benefit Total stock-based compensation, net of taxes $ $ $ Capitalized stock-based compensation (1) $ $ $ (1) It is our policy to capitalize the portion of stock-based compensation costs for our internal development and construction, legal, and facilities departments that relates to capitalizable activities such as the design and construction of new restaurants, remodeling existing locations, lease, intellectual property and liquor license acquisition activities and equipment installation. Capitalized stock-based compensation is included in property and equipment, net and other assets on the consolidated balance sheets. Stock Options The weighted average fair value at the grant date for options issued during fiscal 2016, 2015 and 2014 was $12.10, $14.17 and $15.48 per option, respectively. The fair value of options was estimated utilizing the Black-Scholes valuation model with the following weighted average assumptions for fiscal 2016, 2015 and 2014, respectively: (a) an expected option term of 6.8 years, 6.6 years and 6.5 years, (b) expected stock price volatility of 26.3%, 31.3% and 32.9%, (c) a risk-free interest rate of 1.6%, 1.9% and 2.2%, and (d) a dividend yield on our stock of 1.6%, 1.4% and 1.2%. The expected option term represents the estimated period of time until exercise and is based on historical experience of similar options, giving consideration to the contractual terms, vesting schedules and expectations of future employee behavior. Expected stock price volatility is based on a combination of the historical volatility of our stock and the implied volatility of actively traded options on our common stock. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant with an equivalent remaining term. The dividend yield is based on anticipated cash dividend payouts. Stock option activity during fiscal 2016 was as follows: Shares Weighted Weighted Aggregate (In thousands) (Per share) (In years) (In thousands) Outstanding at beginning of year $ $ Granted $ Exercised ) $ Forfeited or cancelled ) $ Outstanding at end of year $ $ Exercisable at end of year $ $ (1) Aggregate intrinsic value is calculated as the difference between our closing stock price at fiscal year end and the exercise price, multiplied by the number of in-the-money options and represents the pre-tax amount that would have been received by the option holders, had they all exercised their options on the fiscal year end date. The total intrinsic value of options exercised during fiscal 2016, 2015 and 2014 was $40.4 million, $37.0 million and $28.2 million, respectively. As of January 3, 2017, total unrecognized stock-based compensation expense related to unvested stock options was $8.0 million, which we expect to recognize over a weighted average period of approximately 2.6 years. Restricted Shares and Restricted Share Units Restricted share and restricted share unit activity during fiscal 2016 was as follows: Shares Weighted (In thousands) (Per share) Outstanding at beginning of year $ Granted $ Vested ) $ Forfeited ) $ Outstanding at end of year $ Fair value of our restricted shares and restricted share units is based on our closing stock price on the date of grant. The weighted average fair value for restricted shares and restricted share units issued during fiscal 2016, 2015 and 2014 was $50.89, $49.70 and $47.16, respectively. The fair value of shares that vested during fiscal 2016, 2015 and 2014 was $12.2 million, $7.5 million and $4.5 million, respectively. As of January 3, 2017, total unrecognized stock-based compensation expense related to unvested restricted shares and restricted share units was $40.5 million, which we expect to recognize over a weighted average period of approximately 2.6 years. |
Employee Benefit Plans
Employee Benefit Plans | 12 Months Ended |
Jan. 03, 2017 | |
Employee Benefit Plans | |
Employee Benefit Plans | 13. Employee Benefit Plans We have a defined contribution benefit plan in accordance with section 401(k) of the Internal Revenue Code (“401(k) Plan”) that is open to our staff members who meet certain compensation and eligibility requirements. Participation in the 401(k) Plan is currently open to staff members from our three restaurant concepts, our bakery facilities and our corporate offices. The 401(k) Plan allows participating staff members to defer the receipt of a portion of their compensation and contribute such amount to one or more investment options. Our executive officers and a select group of management and/or highly compensated staff members are not eligible to participate in the 401(k) Plan. We currently match in cash a certain percentage of the employee contributions to the 401(k) Plan and also pay a portion of the administrative costs. Expense recognized in fiscal 2016, 2015 and 2014 was $0.9 million, $0.7 million and $0.6 million, respectively. We have also established The Cheesecake Factory Incorporated Executive Savings Plan (“ESP”), a non-qualified deferred compensation plan for our executive officers and a select group of management and/or highly compensated staff members as defined in the plan document. The ESP allows participating staff members to defer the receipt of a portion of their base compensation and up to 100% of their eligible bonuses. Non-employee directors may also participate in the ESP and defer the receipt of their earned director fees. We currently match in cash a certain percentage of the base compensation and bonus deferred by participating staff members and also pay for the ESP administrative costs. We do not match any contributions made by non-employee directors. Expense recognized in fiscal 2016, 2015 and 2014 was $1.0 million, $0.9 million and $0.8 million, respectively. ESP deferrals and matching funds are deposited into a rabbi trust, and are generally invested in individual variable life insurance contracts owned by us that are specifically designed to informally fund savings plans of this nature. These contracts are recorded at their cash surrender value as determined by the insurance carrier. The measurement of these contracts is considered a Level 2 measurement within the fair value hierarchy. Our consolidated balance sheets reflect our investment in variable life insurance contracts in other assets and our obligation to participants in the ESP in other noncurrent liabilities. All income and expenses related to the rabbi trust are reflected in our consolidated statements of income. We maintain self-insured medical and dental benefit plans for our staff members and utilize stop-loss coverage to limit our financial exposure from any individual claim. The accrued liabilities associated with these programs are based on our estimate of the ultimate costs to settle known claims as well as claims incurred but not yet reported to us as of the balance sheet date. The accrued liability for our self-insured benefit plans, which is included in other accrued expenses was $7.8 million and $7.3 million as of January 3, 2017 and December 29, 2015, respectively. See Note 1 for further discussion of accounting for our self-insurance liabilities. |
Income Taxes
Income Taxes | 12 Months Ended |
Jan. 03, 2017 | |
Income Taxes | |
Income Taxes | 14. Income Taxes The provision for income taxes consisted of the following (in thousands): Fiscal Year 2016 2015 2014 Income before income taxes $ $ $ Income tax provision/(benefit): Current: Federal $ $ $ State Total current Deferred: Federal ) State ) ) ) Total deferred ) Total provision $ $ $ The following reconciles the U.S. federal statutory rate to the effective tax rate: Fiscal Year 2016 2015 2014 U.S. federal statutory rate % % % State and district income taxes, net of federal benefit FICA tip credit ) ) ) Other credits and incentives ) ) ) Manufacturing deduction ) ) ) Deferred compensation ) ) Other Effective tax rate % % % Following are the temporary differences that created our deferred tax assets and liabilities (in thousands): January 3, 2017 December 29, 2015 Deferred tax assets: Employee benefits $ $ Insurance reserves Accrued rent Stock-based compensation Deferred income Tax credit carryforwards Other Subtotal Less: Valuation allowance ) ) Total $ $ Deferred tax liabilities: Property and equipment $ ) $ ) Inventory ) ) Prepaid expenses ) ) Total $ ) $ ) Net deferred tax liability $ ) $ ) At January 3, 2017 and December 29, 2015, we had $3.5 million and $4.1 million, respectively, of state tax credit carryforwards, consisting of hiring and investment credits, which began to expire in 2013. We assess the available evidence to estimate if sufficient future taxable income will be generated to use these carryforwards. Based on this evaluation, we recorded a valuation allowance of $0.5 million and $0.6 million at January 3, 2017 and December 29, 2015, respectively, relating to the portion of these credits that we will likely not realize. This assessment could change if estimates of future taxable income during the carryforward period are revised. The earliest tax year still subject to examination by a significant taxing jurisdiction is 2010. At January 3, 2017, we had a reserve of $0.8 million for uncertain tax positions. If recognized, this amount would impact our effective income tax rate. A reconciliation of the beginning and ending amount of our uncertain tax positions is as follows (in thousands): Fiscal Year 2016 2015 2014 Balance at beginning of year $ $ $ Additions related to current period tax positions Reductions related to settlements with taxing authorities and lapses of statutes of limitations ) ) ) Balance at end of year $ $ $ None of the balance of uncertain tax positions at January 3, 2017 relates to tax positions for which it is reasonably possible that the total amount could decrease during the next twelve months based on the lapses of statutes of limitations. At both January 3, 2017 and December 29, 2015, we had approximately $0.1 million of accrued interest and penalties related to uncertain tax positions. |
Stockholder Rights Plan
Stockholder Rights Plan | 12 Months Ended |
Jan. 03, 2017 | |
Stockholder Rights Plan | |
Stockholder Rights Plan | 15. Stockholder Rights Plan We have a stockholder rights plan that provides for the distribution to stockholders of one right to purchase a unit equal to 1/100th of a share of junior participating cumulative preferred stock. The rights are evidenced by our common stock certificates and automatically trade with our common stock. The rights are not exercisable unless a person or group acquires (or commences a tender or exchange offer or announces an intention to acquire) 15% or more of our common stock (or 20% or more if such person or group was beneficial owner of 10% or more of our common stock on August 4, 1998) without the approval of our Board. When declared exercisable, holders of the rights (other than the acquiring person or group) would have the right to purchase units of junior participating cumulative preferred stock having a market value equal to two times the exercise price of each right, which is $110. Additionally, if we are thereafter merged into another entity, or if more than 50% of our consolidated assets or earnings power is sold or transferred, holders of the rights will be entitled to buy common stock of the acquiring person or group equal to two times the exercise price of each right. These rights expire on August 4, 2018, unless redeemed earlier by us. |
Segment Information
Segment Information | 12 Months Ended |
Jan. 03, 2017 | |
Segment Information | |
Segment Information | 16. Segment Information For decision-making purposes, our management reviews discrete financial information for The Cheesecake Factory, Grand Lux Cafe and Rock Sugar Pan Asian Kitchen restaurants, our bakery division and our international licensing operations. Based on quantitative thresholds set forth in ASC 280, “Segment Reporting,” The Cheesecake Factory is our only business that meets the criteria of a reportable operating segment. Grand Lux Cafe, Rock Sugar Pan Asian Kitchen, bakery and international licensing are combined in Other. Unallocated corporate expenses, assets and capital expenditures are presented below as reconciling items to the amounts presented in the consolidated financial statements. Segment information is presented below (in thousands): Fiscal Year 2016 2015 2014 Revenues: The Cheesecake Factory restaurants $ $ $ Other Total $ $ $ Income/(loss) from operations: The Cheesecake Factory restaurants (1) $ $ $ Other (2) Corporate ) ) ) Total $ $ $ Depreciation and amortization: The Cheesecake Factory restaurants $ $ $ Other Corporate Total $ $ $ Capital expenditures: The Cheesecake Factory restaurants $ $ $ Other Corporate Total $ $ $ Total assets: The Cheesecake Factory restaurants $ $ $ Other Corporate Total $ $ $ (1) Fiscal year 2016 includes $0.1 million of accelerated depreciation expense related to the planned relocation of one The Cheesecake Factory restaurant. Fiscal year 2014 includes $0.7 million of impairment and lease termination expenses related to the relocation of one The Cheesecake Factory restaurant. These amounts were recorded in impairment of assets and lease terminations in the consolidated statements of income. (See Note 1 for further discussion of these charges.) (2) Fiscal year 2015 includes $6.0 million of impairment expense related to our Rock Sugar Pan Asian Kitchen restaurant. This amount was recorded in impairment of assets and lease terminations in the consolidated statements of income. (See Note 1 for further discussion of these charges.) |
Quarterly Financial Data (unaud
Quarterly Financial Data (unaudited) | 12 Months Ended |
Jan. 03, 2017 | |
Quarterly Financial Data (unaudited) | |
Quarterly Financial Data (unaudited) | 17. Quarterly Financial Data (unaudited) Summarized unaudited quarterly financial data for fiscal 2016 and 2015, is as follows (in thousands, except per share data): Quarter Ended: March 29, 2016 June 28, 2016 September 27, 2016 January 3, 2017 Revenues $ $ $ $ Income from operations (1) $ $ $ $ Net income $ $ $ $ Basic net income per share (2) $ $ $ $ Diluted net income per share (2) $ $ $ $ Cash dividends declared per common share $ $ $ $ Quarter Ended: March 31, 2015 June 30, 2015 September 29, 2015 December 29, 2015 Revenues $ $ $ $ Income from operations (1) $ $ $ $ Net income $ $ $ $ Basic net income per share (2) $ $ $ $ Diluted net income per share (2) $ $ $ $ Cash dividends declared per common share $ $ $ $ (1) Income from operations included $0.1 million of accelerated depreciation expense in the fourth quarter of fiscal 2016 related to the planned relocation of one The Cheesecake Factory restaurant and $6.0 million of impairment expense in the third quarter of fiscal 2015 related to our Rock Sugar Pan Asian Kitchen restaurant. The impact to net income of these items was $0.1 million and $3.6 million, respectively. (See Note 1 for further discussion of impairment of assets and lease terminations.) (2) Net income per share calculations for each quarter are based on the weighted average diluted shares outstanding for that quarter and may not total to the full year amount. While seasonal fluctuations generally do not have a material impact on our quarterly results, the year-over-year comparison of our quarterly results can be significantly impacted by the number and timing of new restaurant openings and associated preopening costs, the calendar days of the week on which holidays occur, the impact from inclement weather and other climatic conditions, the additional week in a 53-week fiscal year and other variations in revenues and expenses. As a result of these factors, our financial results for any quarter are not necessarily indicative of the results that may be achieved for the full fiscal year. |
Subsequent Event
Subsequent Event | 12 Months Ended |
Jan. 03, 2017 | |
Subsequent Event | |
Subsequent Event | 18. Subsequent Event Dividends On February 16, 2017, our Board approved a quarterly cash dividend of $0.24 per share to be paid on March 21, 2017 to the stockholders of record on March 8, 2017. On February 16, 2017, our Board approved the adoption of a 10b-18 Plan, which will be effective from February 27, 2017 through March 3, 2017. |
Summary of Significant Accoun25
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Jan. 03, 2017 | |
Summary of Significant Accounting Policies | |
Basis of Presentation | Basis of Presentation The accompanying consolidated financial statements include the accounts of The Cheesecake Factory Incorporated and its wholly owned subsidiaries (referred to herein as the “Company,” “we,” “us” and “our”) prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). All intercompany accounts and transactions for the periods presented have been eliminated in consolidation. We utilize a 52/53-week fiscal year ending on the Tuesday closest to December 31 for financial reporting purposes. Fiscal years 2015 and 2014 each consisted of 52 weeks, while fiscal 2016 consisted of 53 weeks. Fiscal year 2017 will consist of 52 weeks. In fiscal 2016, we separately disclosed our gift card liability on the consolidated balance sheet. To conform to the current year presentation, we reclassified the prior year balance that was previously combined in other accrued expenses. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions for the reporting periods covered by the financial statements. These estimates and assumptions affect the reported amounts of assets, liabilities, revenues and expenses, and the disclosure of contingent liabilities. Actual results could differ from these estimates. |
Cash and Cash Equivalents | Cash and Cash Equivalents Amounts receivable from credit card processors, totaling $12.2 million and $10.3 million at January 3, 2017 and December 29, 2015, respectively, are considered cash equivalents because they are both short-term and highly liquid in nature and are typically converted to cash within three days of the sales transaction. Checks issued, but not yet presented for payment to our bank, are reflected as a reduction of cash and cash equivalents. |
Accounts and Other Receivables | Accounts and Other Receivables Our accounts receivable principally result from credit sales to bakery customers. Other receivables consist of various amounts due from our gift card resellers, insurance providers, landlords and others in the ordinary course of business. |
Concentration of Credit Risk | Concentration of Credit Risk Financial instruments that potentially subject us to a concentration of credit risk are cash and cash equivalents and receivables. We maintain our day-to-day operating cash balances in non-interest-bearing transaction accounts, which are insured by the Federal Deposit Insurance Corporation (“FDIC”) up to $250,000. We invest our excess cash in a money market deposit account, which is insured by the FDIC up to $250,000. Although we maintain balances that exceed the federally insured limit, we have not experienced any losses related to this balance, and we believe credit risk to be minimal. We consider the concentration of credit risk for accounts receivable to be minimal due to the payment histories and general financial condition of our larger bakery customers. Concentration of credit risk related to other receivables is limited as this balance is comprised primarily of amounts due from our gift card resellers, insurance providers and landlords for the reimbursement of tenant improvements. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments For cash and cash equivalents, the carrying amount approximates fair value because of the short maturity of these instruments. The fair value of deemed landlord financing liabilities is determined using current applicable rates for similar instruments as of the balance sheet date in accordance with Level 2 of a three-level hierarchy established by accounting standards. Level 2 inputs are observable for the asset or liability, either directly or indirectly, including quoted prices in active markets for similar assets or liabilities. At January 3, 2017, the fair value of our deemed landlord financing liabilities is $102.2 million versus a carrying value of $104.9 million. |
Inventories | Inventories Inventories consist of restaurant food and other supplies, bakery raw materials, and bakery finished goods and are stated at the lower of cost or market on an average cost basis at the restaurants and on a first-in, first-out basis at the bakeries. |
Property and Equipment | Property and Equipment We record property and equipment at cost less accumulated depreciation. Improvements are capitalized while repairs and maintenance costs are expensed as incurred. Depreciation and amortization are calculated using the straight-line method over the estimated useful life of the assets or the lease term, whichever is shorter. Leasehold improvements include the cost of our internal development and construction department. Depreciation and amortization periods are as follows: Buildings and land improvements 25 to 30 years Leasehold improvements 10 to 30 years Furnishings, fixtures and equipment 3 to 15 years Computer software and equipment 5 years Gains and losses related to property and equipment disposals are recorded in interest and other expenses, net. |
Indefinite-Lived Assets | Indefinite-Lived Assets Our trademarks and transferable alcoholic beverage licenses have indefinite lives and, therefore, are not subject to amortization. At January 3, 2017 and December 29, 2015, the amounts included in intangibles, net for these items were $14.6 million and $13.8 million, respectively. We test these assets for impairment at least annually by comparing the fair value of each asset with its carrying amount. |
Impairment of Long-Lived Assets and Lease Terminations | Impairment of Long-Lived Assets and Lease Terminations We assess the potential impairment of our long-lived assets whenever events or changes in circumstances indicate the carrying value of the assets or asset group may not be recoverable. Factors considered include, but are not limited to, significant underperformance relative to historical or projected future operating results, significant changes in the manner in which an asset is being used, an expectation that an asset will be disposed of significantly before the end of its previously estimated useful life and significant negative industry or economic trends. We regularly review restaurants that are cash flow negative for the previous four quarters and those that are being considered for closure or relocation to determine if impairment testing is warranted. At any given time, we may be monitoring a small number of locations, and future impairment charges could be required if individual restaurant performance does not improve or we make the decision to close or relocate a restaurant. We have determined that our asset group for impairment testing is comprised of the assets and liabilities of each of our individual restaurants, as this is the lowest level of identifiable cash flows. We have identified leasehold improvements as the primary asset because it is the most significant component of our restaurant assets, it is the principal asset from which our restaurants derive their cash flow generating capacity and it has the longest remaining useful life. The recoverability is assessed in most cases by comparing the carrying value of the assets to the undiscounted cash flows expected to be generated by these assets. Impairment losses are measured as the amount by which the carrying values of the assets exceed their fair values. During fiscal 2016, we incurred $0.1 million of accelerated depreciation expense related to the planned relocation of one The Cheesecake Factory restaurant and we expect to incur an additional $1.2 million of accelerated depreciation and impairment expense related to this relocation in fiscal 2017. During fiscal 2015, we incurred $6.0 million of impairment expense against the carrying value of our Rock Sugar Pan Asian Kitchen restaurant assets. In fiscal 2014, we incurred $0.7 million of accelerated depreciation, future rent and other closing costs related to the relocation of one The Cheesecake Factory restaurant. These amounts were recorded in impairment of assets and lease terminations. |
Investments in Unconsolidated Affiliates | Investments in Unconsolidated Affiliates During the fourth quarter of fiscal 2016, we made initial minority equity investments in two restaurant concepts, North Italia and Flower Child. Since we hold a number of rights with regard to participation in policy-making processes, but do not control these entities, we account for these investments under the equity method. We recognize our proportionate share of the reported earnings or losses of these entities in interest and other expense, net on the consolidated statements of income and as an adjustment to other assets on the consolidated balance sheets. |
Revenue Recognition | Revenue Recognition Our revenues consist of sales from our restaurant operations, sales from our bakery operations to our licensees and other third-party customers and royalties on our licensees’ restaurant sales. Revenues from restaurant sales are recognized when payment is tendered at the point of sale. Revenues from bakery sales are recognized upon transfer of title and risk to customers. Royalties from international licensees are accrued as revenues when earned. Revenues are presented net of sales taxes. Sales tax collected is included in other accrued expenses until the taxes are remitted to the appropriate taxing authorities. We recognize a liability upon the sale of our gift cards and recognize revenue when these gift cards are redeemed in our restaurants. Based on our historical redemption patterns, we can reasonably estimate the amount of gift cards for which redemption is remote, which is referred to as “breakage.” Breakage is recognized over a three-year period in proportion to historical redemption trends and is classified as revenues in our consolidated statements of income. We recognized $7.6 million, $6.6 million and $5.4 million of gift card breakage in fiscal years 2016, 2015 and 2014, respectively. Incremental direct costs related to gift card sales, including commissions and credit card fees, are deferred and recognized in earnings in the same pattern as the related gift card revenue. Certain of our promotional programs include multiple element arrangements that incorporate both delivered and undelivered components. We allocate revenue using the relative selling price of each deliverable and recognize it upon delivery of each component. |
Leases | Leases We currently lease all of our restaurant locations. We evaluate each lease to determine its appropriate classification as an operating or capital lease for financial reporting purposes. All of our restaurant leases are classified as operating leases. Minimum base rent, which generally escalates over the term of the lease, is recorded on a straight-line basis over the lease term. The initial lease term includes the build-out, or rent holiday, period for our leases, where no rent payments are typically due under the terms of the lease. Contingent rent expense, which is based on a percentage of revenues, is recorded as incurred to the extent it exceeds minimum base rent per the lease agreement. We expend cash for leasehold improvements and furnishings, fixtures and equipment to build out and equip our leased premises. We may also expend cash for structural additions that we make to leased premises. Generally a portion of the leasehold improvements and building costs are reimbursed to us by our landlords as construction contributions. If obtained, landlord construction contributions usually take the form of up-front cash, full or partial credits against our future minimum or percentage rents, or a combination thereof. Depending on the specifics of the leased space and the lease agreement, amounts paid for structural components are recorded during the construction period as either prepaid rent or property and equipment and the landlord construction contributions are recorded as either an offset to prepaid rent or as a deemed landlord financing liability. For those leases for which we are deemed the owner of the property during construction, upon completion, we perform an analysis to determine if they qualify for sale-leaseback treatment. For those qualifying leases, the deemed landlord financing liability and the associated property and equipment are removed and the difference is reclassified to either prepaid or deferred rent and amortized over the lease term as an increase or decrease to rent expense. If the lease does not qualify for sale-leaseback treatment, the deemed landlord financing liability is amortized over the lease term based on the rent payments designated in the lease agreement. |
Self-Insurance Liabilities | Self-Insurance Liabilities We retain the financial responsibility for a significant portion of our risks and associated liabilities with respect to workers’ compensation, general liability, employee health benefits, employment practices and other insurable risks. The accrued liabilities associated with our self-insured programs are based on our estimate of the ultimate costs to settle known claims as well as claims incurred but not yet reported to us (“IBNR”) as of the balance sheet date and are recorded in other accrued expenses. Our estimated liabilities are not discounted and are based on information provided by our insurance brokers and insurers, combined with our judgment regarding a number of assumptions and factors, including the frequency and severity of claims, claims development history, case jurisdiction, applicable legislation and our claims settlement practices. We maintain stop-loss coverage with third-party insurers to limit our individual claim exposure for many of our programs. The estimated amounts receivable from our third-party insurers under this coverage are recorded in other receivables. |
Stock-Based Compensation | Stock-Based Compensation We maintain stock-based incentive plans under which equity awards may be granted to employees and consultants. We account for the awards based on fair value measurement guidance and amortize to expense over the vesting period using a straight-line or graded-vesting schedule, as applicable. We reclassify the excess tax benefit resulting from the exercise of stock options out of cash flows from operating activities and into cash flows from financing activities on the consolidated statements of cash flows. See Note 12 for further discussion of our stock-based compensation. |
Advertising Costs | Advertising Costs We expense advertising production costs at the time the advertising first takes place. All other advertising costs are expensed as incurred. Most of our advertising costs are included in other operating costs and expenses and were $7.4 million, $5.0 million and $6.2 million in fiscal 2016, 2015 and 2014, respectively. |
Preopening Costs | Preopening Costs Preopening costs include all costs to relocate and compensate restaurant management employees during the preopening period, costs to recruit and train hourly restaurant employees, and wages, travel and lodging costs for our opening training team and other support staff members. Also included are expenses for maintaining a roster of trained managers for pending openings, the associated temporary housing and other costs necessary to relocate managers in alignment with future restaurant opening and operating needs, and corporate travel and support activities. We expense preopening costs as incurred. |
Income Taxes | Income Taxes We provide for federal, state and foreign income taxes currently payable and for deferred taxes that result from differences between financial accounting rules and tax laws governing the timing of recognition of various income and expense items. We recognize deferred income tax assets and liabilities for the future tax effects of such temporary differences based on the difference between the financial statement and tax bases of existing assets and liabilities using the statutory rates expected in the years in which the differences are expected to reverse. The effect on deferred taxes of any enacted change in tax rates is recognized in income in the period that includes the enactment date. Income tax credits are recorded as a reduction of tax expense. We account for uncertain tax positions under Financial Accounting Standards Board (“FASB”) guidance, which requires that a position taken or expected to be taken in a tax return be recognized (or derecognized) in the financial statements when it is more likely than not (i.e., a likelihood of more than 50%) that the position would be sustained on its technical merits upon examination by tax authorities, taking into account available administrative remedies and litigation. A recognized tax position is then measured at the largest amount of benefit that is greater than 50% likely of being realized upon ultimate resolution. We recognize interest related to uncertain tax positions in income tax expense. Penalties related to uncertain tax positions are recorded in general and administrative expenses. |
Net Income per Share | Net Income per Share Basic net income per share is computed by dividing net income available to common stockholders by the weighted average number of common shares outstanding during the period. At January 3, 2017, December 29, 2015 and December 30, 2014, 1.9 million, 1.9 million and 1.8 million shares, respectively, of restricted stock issued to employees were unvested and, therefore, excluded from the calculation of basic earnings per share for the fiscal years ended on those dates. Diluted net income per share includes the dilutive effect of outstanding equity awards, calculated using the treasury stock method. Assumed proceeds from the in-the-money options include the windfall tax benefits, net of shortfalls, calculated under the “as-if” method as prescribed by FASB Accounting Standards Codification 718, “Compensation — Stock Option Compensation.” Fiscal Year 2016 2015 2014 (In thousands, except per share data) Net income $ $ $ Basic weighted average shares outstanding Dilutive effect of equity awards Diluted weighted average shares outstanding Basic net income per share $ $ $ Diluted net income per share $ $ $ Shares of common stock equivalents of 1.4 million, 1.3 million and 1.0 million for fiscal 2016, 2015 and 2014, respectively, were excluded from the diluted calculation due to their anti-dilutive effect. |
Comprehensive Income | Comprehensive Income Comprehensive income includes all changes in equity during a period except those resulting from investment by and distribution to owners. For fiscal years 2016, 2015 and 2014, our comprehensive income consisted solely of net income. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In March 2016, the FASB issued guidance affecting all entities that issue share-based payment awards to their employees. This update covers such areas as the recognition of excess tax benefits and deficiencies, the classification of those excess tax benefits on the statement of cash flows, an accounting policy election for forfeitures, the amount an employer can withhold to cover income taxes and still qualify for equity classification and the classification of those taxes paid on the statement of cash flows. This guidance is effective for annual and interim periods beginning after December 15, 2016. Although early adoption is permitted, we will adopt these provisions prospectively in the first quarter of fiscal 2017. These changes will impact our tax provision, cash flows from operating activities and cash flows from financing activities. We will continue to estimate forfeitures each period, so there will be no change associated with forfeitures. Excess tax benefits and deficiencies are heavily impacted by factors outside of our control such as the number of stock options exercised and the market price of our stock. For purposes of our Fiscal 2017 Outlook in Part II, Item 7 of this report, we estimated the implementation of this guidance to reduce our annual effective tax rate by a range of 3% to 4%. In February 2016, the FASB issued guidance that requires a lessee to recognize on the balance sheet a liability to make lease payments and a corresponding right-of-use asset. The standard also requires certain qualitative and quantitative disclosures about the amount, timing and uncertainty of cash flows arising from leases. This update is effective for annual and interim periods beginning after December 15, 2018 and requires a modified retrospective approach. Although early adoption is permitted, we will adopt these provisions in the first quarter of fiscal 2019. This guidance will have a material effect on our consolidated financial statements. In July 2015, the FASB issued guidance that requires inventory within the scope of the standard to be measured at the lower of cost or net realizable value. Previous guidance required inventory to be measured at the lower of cost or market (where market was defined as replacement cost, with a ceiling of net realizable value and floor of net realizable value less a normal profit margin). The updated guidance is effective for interim and annual reporting periods beginning after December 15, 2016, with early adoption permitted. We expect the adoption of this guidance to have no material impact on our consolidated financial statements. In April 2015, the FASB issued guidance regarding a customer’s accounting for fees paid in a cloud computing arrangement. If a cloud computing arrangement includes a software license, the customer should account for the software license element of the arrangement consistent with the acquisition of other software licenses. If a cloud computing arrangement does not include a software license, the customer should account for the arrangement as a service contract. This guidance was effective for fiscal years beginning after December 15, 2015, with early adoption permitted. Our adoption of this guidance in the first quarter of fiscal 2016 had no impact on our consolidated financial statements. In April 2015, the FASB issued updated guidance intended to simplify, and provide consistency to, the presentation of debt issuance costs. The new standard requires that debt issuance costs be presented in the balance sheet as a direct deduction from the carrying amount of the debt liability, consistent with debt discounts. In August 2015, the FASB provided additional guidance for presentation of debt issuance costs related to line-of-credit arrangements. The updated guidance was effective for interim and annual reporting periods beginning after December 15, 2015, with early adoption permitted. Our adoption of this guidance in the first quarter of fiscal 2016 had no impact on our consolidated financial statements. In February 2015, the FASB issued updated guidance that changes the analysis that a reporting entity must perform to determine whether it should consolidate certain types of legal entities. The updated guidance was effective for interim and annual reporting periods beginning after December 15, 2015, with early adoption permitted. Our adoption of this guidance in the first quarter of fiscal 2016 had no impact on our consolidated financial statements. In June 2014, the FASB issued updated guidance intended to eliminate the diversity in practice regarding share-based payment awards that include terms which provide for a performance target that affects vesting being achieved after the requisite service period. The new standard requires that a performance target which affects vesting and could be achieved after the requisite service period be treated as a performance condition that affects vesting and should not be reflected in estimating the grant-date fair value. The updated guidance was effective for interim and annual reporting periods beginning after December 15, 2015, with early adoption permitted. Our adoption of this guidance in the first quarter of fiscal 2016 had no impact on our consolidated financial statements. In May 2014, the FASB issued accounting guidance that provides a comprehensive new revenue recognition model that supersedes most of the existing revenue recognition requirements and require entities to recognize revenue at an amount that reflects the consideration to which a company expects to be entitled in exchange for transferring goods or services to a customer. In August 2015, the FASB deferred the effective date of this standard by one year with early adoption permitted no earlier than the original effective date. The guidance is now effective for us beginning in the first quarter of fiscal 2018. In March and April 2016, the FASB provided additional guidance related to implementation. This standard is not expected to have a material impact on our consolidated financial statements. |
Summary of Significant Accoun26
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Jan. 03, 2017 | |
Summary of Significant Accounting Policies | |
Schedule of depreciation and amortization periods | Buildings and land improvements 25 to 30 years Leasehold improvements 10 to 30 years Furnishings, fixtures and equipment 3 to 15 years Computer software and equipment 5 years |
Schedule of basic and diluted income per share | Fiscal Year 2016 2015 2014 (In thousands, except per share data) Net income $ $ $ Basic weighted average shares outstanding Dilutive effect of equity awards Diluted weighted average shares outstanding Basic net income per share $ $ $ Diluted net income per share $ $ $ |
Other Receivables (Tables)
Other Receivables (Tables) | 12 Months Ended |
Jan. 03, 2017 | |
Other Receivables | |
Schedule of other receivables | Other receivables consisted of (in thousands): January 3, 2017 December 29, 2015 Gift card resellers $ $ Insurance providers Landlord construction contributions Other Total $ $ |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Jan. 03, 2017 | |
Inventories | |
Schedule of inventories | Inventories consisted of (in thousands): January 3, 2017 December 29, 2015 Restaurant food and supplies $ $ Bakery finished goods and work in progress Bakery raw materials and supplies Total $ $ |
Prepaid Expenses (Tables)
Prepaid Expenses (Tables) | 12 Months Ended |
Jan. 03, 2017 | |
Prepaid Expenses | |
Schedule of prepaid expenses | Prepaid expenses consisted of (in thousands): January 3, 2017 December 29, 2015 Gift card costs $ $ Rent Other Total $ $ |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Jan. 03, 2017 | |
Property and Equipment | |
Schedule of property and equipment | Property and equipment consisted of (in thousands): January 3, 2017 December 29, 2015 Land and related improvements $ $ Buildings Leasehold improvements Furnishings, fixtures and equipment Computer software and equipment Restaurant smallwares Construction in progress Property and equipment, total Less: Accumulated depreciation ) ) Property and equipment, net $ $ |
Other Assets (Tables)
Other Assets (Tables) | 12 Months Ended |
Jan. 03, 2017 | |
Other Assets | |
Schedule of other assets | Other assets consisted of (in thousands): January 3, 2017 December 29, 2015 Executive Savings Plan assets trust $ $ Investments in unconsolidated affiliates — Deposits Total $ $ |
Other Accrued Expenses (Tables)
Other Accrued Expenses (Tables) | 12 Months Ended |
Jan. 03, 2017 | |
Other Accrued Expenses | |
Schedule of other accrued expenses | Other accrued expenses consisted of (in thousands): January 3, 2017 December 29, 2015 Self-insurance $ $ Salaries and wages Employee benefits Payroll and sales taxes Other Total $ $ |
Other Noncurrent Liabilities (T
Other Noncurrent Liabilities (Tables) | 12 Months Ended |
Jan. 03, 2017 | |
Other Noncurrent Liabilities | |
Schedule of other noncurrent liabilities | Other noncurrent liabilities consisted of (in thousands): January 3, 2017 December 29, 2015 Executive Savings Plan $ $ Other Total $ $ |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Jan. 03, 2017 | |
Commitments and Contingencies | |
Schedule of aggregate minimum annual lease payments under operating leases | As of January 3, 2017, the aggregate minimum annual lease payments under operating leases, including amounts characterized as deemed landlord financing payments are as follows (in thousands): 2017 $ 2018 2019 2020 2021 Thereafter Total $ |
Schedule of rent expense on all operating leases | Rent expense on all operating leases was as follows (in thousands): Fiscal Year 2016 2015 2014 Straight-lined minimum base rent $ $ $ Contingent rent Common area maintenance and taxes Total $ $ $ |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
Jan. 03, 2017 | |
Stock-Based Compensation | |
Schedule of information related to stock-based compensation | The following table presents information related to stock-based compensation, net of forfeitures (in thousands): Fiscal Year 2016 2015 2014 Labor expenses $ $ $ Other operating costs and expenses General and administrative expenses Total stock-based compensation Income tax benefit Total stock-based compensation, net of taxes $ $ $ Capitalized stock-based compensation (1) $ $ $ (1) It is our policy to capitalize the portion of stock-based compensation costs for our internal development and construction, legal, and facilities departments that relates to capitalizable activities such as the design and construction of new restaurants, remodeling existing locations, lease, intellectual property and liquor license acquisition activities and equipment installation. Capitalized stock-based compensation is included in property and equipment, net and other assets on the consolidated balance sheets. |
Schedule of stock option activity | Shares Weighted Weighted Aggregate (In thousands) (Per share) (In years) (In thousands) Outstanding at beginning of year $ $ Granted $ Exercised ) $ Forfeited or cancelled ) $ Outstanding at end of year $ $ Exercisable at end of year $ $ (1) Aggregate intrinsic value is calculated as the difference between our closing stock price at fiscal year end and the exercise price, multiplied by the number of in-the-money options and represents the pre-tax amount that would have been received by the option holders, had they all exercised their options on the fiscal year end date. |
Schedule of restricted share and restricted share unit activity | Shares Weighted (In thousands) (Per share) Outstanding at beginning of year $ Granted $ Vested ) $ Forfeited ) $ Outstanding at end of year $ |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Jan. 03, 2017 | |
Income Taxes | |
Schedule of provision for income taxes | The provision for income taxes consisted of the following (in thousands): Fiscal Year 2016 2015 2014 Income before income taxes $ $ $ Income tax provision/(benefit): Current: Federal $ $ $ State Total current Deferred: Federal ) State ) ) ) Total deferred ) Total provision $ $ $ |
Schedule of reconciliation between U.S. federal statutory rate and effective tax rate | Fiscal Year 2016 2015 2014 U.S. federal statutory rate % % % State and district income taxes, net of federal benefit FICA tip credit ) ) ) Other credits and incentives ) ) ) Manufacturing deduction ) ) ) Deferred compensation ) ) Other Effective tax rate % % % |
Schedule of deferred tax assets and liabilities | Following are the temporary differences that created our deferred tax assets and liabilities (in thousands): January 3, 2017 December 29, 2015 Deferred tax assets: Employee benefits $ $ Insurance reserves Accrued rent Stock-based compensation Deferred income Tax credit carryforwards Other Subtotal Less: Valuation allowance ) ) Total $ $ Deferred tax liabilities: Property and equipment $ ) $ ) Inventory ) ) Prepaid expenses ) ) Total $ ) $ ) Net deferred tax liability $ ) $ ) |
Schedule of reconciliation of our uncertain tax positions | A reconciliation of the beginning and ending amount of our uncertain tax positions is as follows (in thousands): Fiscal Year 2016 2015 2014 Balance at beginning of year $ $ $ Additions related to current period tax positions Reductions related to settlements with taxing authorities and lapses of statutes of limitations ) ) ) Balance at end of year $ $ $ |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Jan. 03, 2017 | |
Segment Information | |
Schedule of segment information | Segment information is presented below (in thousands): Fiscal Year 2016 2015 2014 Revenues: The Cheesecake Factory restaurants $ $ $ Other Total $ $ $ Income/(loss) from operations: The Cheesecake Factory restaurants (1) $ $ $ Other (2) Corporate ) ) ) Total $ $ $ Depreciation and amortization: The Cheesecake Factory restaurants $ $ $ Other Corporate Total $ $ $ Capital expenditures: The Cheesecake Factory restaurants $ $ $ Other Corporate Total $ $ $ Total assets: The Cheesecake Factory restaurants $ $ $ Other Corporate Total $ $ $ (1) Fiscal year 2016 includes $0.1 million of accelerated depreciation expense related to the planned relocation of one The Cheesecake Factory restaurant. Fiscal year 2014 includes $0.7 million of impairment and lease termination expenses related to the relocation of one The Cheesecake Factory restaurant. These amounts were recorded in impairment of assets and lease terminations in the consolidated statements of income. (See Note 1 for further discussion of these charges.) (2) Fiscal year 2015 includes $6.0 million of impairment expense related to our Rock Sugar Pan Asian Kitchen restaurant. This amount was recorded in impairment of assets and lease terminations in the consolidated statements of income. (See Note 1 for further discussion of these charges.) |
Quarterly Financial Data (una38
Quarterly Financial Data (unaudited) (Tables) | 12 Months Ended |
Jan. 03, 2017 | |
Quarterly Financial Data (unaudited) | |
Summary of quarterly financial data | Summarized unaudited quarterly financial data for fiscal 2016 and 2015, is as follows (in thousands, except per share data): Quarter Ended: March 29, 2016 June 28, 2016 September 27, 2016 January 3, 2017 Revenues $ $ $ $ Income from operations (1) $ $ $ $ Net income $ $ $ $ Basic net income per share (2) $ $ $ $ Diluted net income per share (2) $ $ $ $ Cash dividends declared per common share $ $ $ $ Quarter Ended: March 31, 2015 June 30, 2015 September 29, 2015 December 29, 2015 Revenues $ $ $ $ Income from operations (1) $ $ $ $ Net income $ $ $ $ Basic net income per share (2) $ $ $ $ Diluted net income per share (2) $ $ $ $ Cash dividends declared per common share $ $ $ $ (1) Income from operations included $0.1 million of accelerated depreciation expense in the fourth quarter of fiscal 2016 related to the planned relocation of one The Cheesecake Factory restaurant and $6.0 million of impairment expense in the third quarter of fiscal 2015 related to our Rock Sugar Pan Asian Kitchen restaurant. The impact to net income of these items was $0.1 million and $3.6 million, respectively. (See Note 1 for further discussion of impairment of assets and lease terminations.) (2) Net income per share calculations for each quarter are based on the weighted average diluted shares outstanding for that quarter and may not total to the full year amount. |
Summary of Significant Accoun39
Summary of Significant Accounting Policies (Details) | Mar. 02, 2017item | Jan. 02, 2018 | Jan. 03, 2017USD ($) | Dec. 29, 2015USD ($) | Dec. 30, 2014 |
Description of Business | |||||
Number of company-owned upscale, casual, full-service dining restaurants | item | 208 | ||||
Number of International locations operating under licensing agreements | item | 15 | ||||
Number of bakery production facilities | item | 2 | ||||
Summary of Significant Accounting Policies | |||||
Length of fiscal year | P364D | P371D | P364D | P364D | |
Cash and Cash Equivalents | |||||
Amounts receivable from credit card processors | $ 12,200,000 | $ 10,300,000 | |||
Conversion period, credit card sales | P3D | P3D | |||
Concentration of Credit Risk | |||||
Maximum amount of money market deposit insured by FDIC | $ 250,000 | ||||
Fair Value of Financial Instruments | |||||
Fair value of deemed landlord financing liabilities | 102,200,000 | ||||
Carrying value of deemed landlord financing liabilities | $ 104,900,000 | ||||
Buildings and land improvements | Minimum | |||||
Property and equipment | |||||
Useful life | 25 years | ||||
Buildings and land improvements | Maximum | |||||
Property and equipment | |||||
Useful life | 30 years | ||||
Leasehold improvements | Minimum | |||||
Property and equipment | |||||
Useful life | 10 years | ||||
Leasehold improvements | Maximum | |||||
Property and equipment | |||||
Useful life | 30 years | ||||
Furnishings, fixtures and equipment | Minimum | |||||
Property and equipment | |||||
Useful life | 3 years | ||||
Furnishings, fixtures and equipment | Maximum | |||||
Property and equipment | |||||
Useful life | 15 years | ||||
Computer software and equipment | |||||
Property and equipment | |||||
Useful life | 5 years |
Summary of Significant Accoun40
Summary of Significant Accounting Policies - Indefinite-Lived Assets (Details) - USD ($) $ in Millions | Jan. 03, 2017 | Dec. 29, 2015 |
Trademarks | ||
Indefinite-Lived Assets | ||
Indefinite-lived intangible assets | $ 14.6 | |
Transferable alcoholic beverage licenses | ||
Indefinite-Lived Assets | ||
Indefinite-lived intangible assets | $ 13.8 |
Summary of Significant Accoun41
Summary of Significant Accounting Policies - Impairment of Long-Lived Assets (Details) $ in Millions | 3 Months Ended | 12 Months Ended | ||||
Jan. 03, 2017USD ($)item | Sep. 29, 2015USD ($) | Jan. 02, 2018USD ($) | Jan. 03, 2017USD ($)item | Dec. 29, 2015USD ($) | Dec. 30, 2014USD ($)item | |
Impairment of long-lived assets and lease terminations | ||||||
Period of time used to determine if impairment testing is warranted | 1 year | |||||
Investments in unconsolidated affiliates | ||||||
Equity investments in number of restaurants | item | 2 | 2 | ||||
The Cheesecake Factory restaurants | ||||||
Impairment of long-lived assets and lease terminations | ||||||
Impairment and accelerated depreciation expense | $ | $ 0.1 | $ 6 | $ 0.1 | $ 6 | $ 0.7 | |
Number of restaurants related to planned relocation | item | 1 | 1 | 1 | |||
The Cheesecake Factory restaurants | Forecast | ||||||
Impairment of long-lived assets and lease terminations | ||||||
Impairment and accelerated depreciation expense | $ | $ 1.2 |
Summary of Significant Accoun42
Summary of Significant Accounting Policies - Net income per share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Jan. 03, 2017 | Sep. 27, 2016 | Jun. 28, 2016 | Mar. 29, 2016 | Dec. 29, 2015 | Sep. 29, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Jan. 03, 2017 | Dec. 29, 2015 | Dec. 30, 2014 | |
Revenue Recognition | |||||||||||
Gift card breakage period | 3 years | ||||||||||
Gift card breakage | $ 7,600 | $ 6,600 | $ 5,400 | ||||||||
Advertising Costs | |||||||||||
Advertising costs | 7,400 | 5,000 | 6,200 | ||||||||
Net income per share, basic and diluted | |||||||||||
Net income | $ 32,381 | $ 34,574 | $ 38,585 | $ 33,954 | $ 27,200 | $ 26,176 | $ 34,724 | $ 28,423 | $ 139,494 | $ 116,523 | $ 101,276 |
Basic weighted average shares outstanding (in shares) | 47,981 | 48,833 | 49,567 | ||||||||
Dilutive effect of equity awards (in shares) | 1,391 | 1,772 | 2,017 | ||||||||
Diluted weighted average shares outstanding (in shares) | 49,372 | 50,605 | 51,584 | ||||||||
Basic net income per share (in dollars per share) | $ 0.68 | $ 0.72 | $ 0.80 | $ 0.70 | $ 0.56 | $ 0.54 | $ 0.72 | $ 0.58 | $ 2.91 | $ 2.39 | $ 2.04 |
Diluted net income per share (in dollars per share) | $ 0.66 | $ 0.70 | $ 0.78 | $ 0.68 | $ 0.54 | $ 0.52 | $ 0.69 | $ 0.56 | $ 2.83 | $ 2.30 | $ 1.96 |
Antidilutive securities excluded from calculation of basic earnings per share (in shares) | 1,400 | 1,300 | 1,000 | ||||||||
Restricted shares and restricted share units | |||||||||||
Net income per share, basic and diluted | |||||||||||
Antidilutive securities excluded from calculation of basic earnings per share (in shares) | 1,900 | 1,900 | 1,800 |
Summary of Significant Accoun43
Summary of Significant Accounting Policies - Recent Accounting Pronouncements (Details) - Forecast | 12 Months Ended |
Jan. 02, 2018 | |
Minimum | |
Recent Accounting Pronouncements | |
Decrease to effective tax rate due to implementation of accounting guidance relating to share based payment awards | 3.00% |
Maximum | |
Recent Accounting Pronouncements | |
Decrease to effective tax rate due to implementation of accounting guidance relating to share based payment awards | 4.00% |
Other Receivables (Details)
Other Receivables (Details) - USD ($) $ in Thousands | Jan. 03, 2017 | Dec. 29, 2015 |
Other Receivables | ||
Gift card resellers | $ 42,719 | $ 40,245 |
Insurance providers | 6,458 | 7,225 |
Landlord construction contributions | 4,807 | 13,619 |
Other | 10,608 | 11,569 |
Total | $ 64,592 | $ 72,658 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Jan. 03, 2017 | Dec. 29, 2015 |
Inventories | ||
Restaurant food and supplies | $ 16,555 | $ 16,127 |
Bakery finished goods and work in progress | 12,121 | 12,104 |
Bakery raw materials and supplies | 6,250 | 5,779 |
Total | $ 34,926 | $ 34,010 |
Prepaid Expenses (Details)
Prepaid Expenses (Details) - USD ($) $ in Thousands | Jan. 03, 2017 | Dec. 29, 2015 |
Prepaid Expenses | ||
Gift card costs | $ 23,786 | $ 23,362 |
Rent | 16,072 | 5,236 |
Other | 12,580 | 13,378 |
Total | $ 52,438 | $ 41,976 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 03, 2017 | Dec. 29, 2015 | Dec. 30, 2014 | |
Property and equipment | |||
Property and equipment, total | $ 1,768,890 | $ 1,676,782 | |
Less: accumulated depreciation | (858,756) | (784,591) | |
Property and equipment, net | 910,134 | 892,191 | |
Depreciation expenses | 88,000 | 85,600 | $ 82,400 |
Repair and maintenance expenses | 50,100 | 44,900 | 42,700 |
Net expense on property and equipment disposals | 3,600 | 2,100 | $ 2,000 |
Land and related improvements | |||
Property and equipment | |||
Property and equipment, total | 15,852 | 15,852 | |
Buildings | |||
Property and equipment | |||
Property and equipment, total | 37,607 | 20,610 | |
Leasehold improvements | |||
Property and equipment | |||
Property and equipment, total | 1,187,178 | 1,126,529 | |
Furnishings, fixtures and equipment | |||
Property and equipment | |||
Property and equipment, total | 428,652 | 387,779 | |
Computer software and equipment | |||
Property and equipment | |||
Property and equipment, total | 49,490 | 49,917 | |
Restaurant smallwares | |||
Property and equipment | |||
Property and equipment, total | 29,275 | 47,363 | |
Construction in progress | |||
Property and equipment | |||
Property and equipment, total | $ 20,836 | $ 28,732 |
Other Assets (Details)
Other Assets (Details) - USD ($) $ in Thousands | Jan. 03, 2017 | Dec. 29, 2015 |
Other Assets | ||
Executive Savings Plan assets trust | $ 49,025 | $ 41,463 |
Investments in unconsolidated affiliates | 42,000 | |
Deposits | 5,517 | 5,443 |
Total | $ 96,542 | $ 46,906 |
Other Accrued Expenses (Details
Other Accrued Expenses (Details) - USD ($) $ in Thousands | Jan. 03, 2017 | Dec. 29, 2015 |
Other Accrued Expenses | ||
Self-insurance | $ 64,135 | $ 60,033 |
Salaries and wages | 39,401 | 31,570 |
Employee benefits | 20,607 | 19,980 |
Payroll and sales taxes | 20,197 | 14,633 |
Other | 34,694 | 32,097 |
Total | $ 179,034 | $ 158,313 |
Long-Term Debt (Details)
Long-Term Debt (Details) $ in Millions | 12 Months Ended | |||
Jan. 03, 2017USD ($)item | Dec. 29, 2015USD ($) | Dec. 30, 2014USD ($) | Nov. 10, 2016USD ($) | |
Long-term debt | ||||
Maximum commitments | $ 200 | |||
Maximum commitments, letter of credit subfacility | 50 | |||
Additional available credit | $ 100 | |||
Available borrowings | $ 178 | |||
Outstanding borrowings | 0 | |||
Outstanding letters of credit | $ 22 | |||
Multiplier of rent used to compute Adjusted Debt | item | 8 | |||
Threshold amount of unrestricted cash and cash equivalents above which amounts are netted against debt for calculation of net adjusted leverage ratio | $ 25 | |||
Trailing period for which EBITDAR is computed | 12 months | |||
Net Adjusted Leverage Ratio | 2.4 | |||
EBITDAR Ratio | 3.1 | |||
Capitalized interest expense | $ 0.6 | $ 1.6 | $ 0.8 | |
Minimum | ||||
Long-term debt | ||||
Financial covenant, EBITDAR Ratio | 1.9 | |||
Commitment fee (as a percent) | 0.125% | |||
Maximum | ||||
Long-term debt | ||||
Financial covenant, Net Adjusted Leverage Ratio | 4 | |||
Commitment fee (as a percent) | 0.25% | |||
Adjusted LIBO Rate | ||||
Long-term debt | ||||
Credit facility, floating interest rate basis | Adjusted LIBO Rate | |||
Adjusted LIBO Rate | Minimum | ||||
Long-term debt | ||||
Credit facility, basis spread on variable rate, (as a percent) | 1.00% | |||
Adjusted LIBO Rate | Maximum | ||||
Long-term debt | ||||
Credit facility, basis spread on variable rate, (as a percent) | 1.75% | |||
Federal Funds Effective Rate | ||||
Long-term debt | ||||
Credit facility, floating interest rate basis | Federal Funds Effective Rate | |||
Credit facility, basis spread on variable rate, (as a percent) | 0.50% | |||
One-month Adjusted LIBO Rate | ||||
Long-term debt | ||||
Credit facility, floating interest rate basis | one-month Adjusted LIBO Rate | |||
Fixed percentage added to variable rate | 1.00% | |||
One-month Adjusted LIBO Rate | Minimum | ||||
Long-term debt | ||||
Credit facility, basis spread on variable rate, (as a percent) | 0.00% | |||
One-month Adjusted LIBO Rate | Maximum | ||||
Long-term debt | ||||
Credit facility, basis spread on variable rate, (as a percent) | 0.75% |
Other Noncurrent Liabilities (D
Other Noncurrent Liabilities (Details) - USD ($) $ in Thousands | Jan. 03, 2017 | Dec. 29, 2015 |
Other Noncurrent Liabilities | ||
Executive Savings Plan | $ 49,232 | $ 41,281 |
Other | 9,802 | 10,024 |
Total | $ 59,034 | $ 51,305 |
Commitments and Contingencies52
Commitments and Contingencies (Details) | Feb. 03, 2017item | Jan. 03, 2017USD ($) | Dec. 13, 2016USD ($) | Jan. 03, 2017USD ($) | Dec. 29, 2015USD ($) | Dec. 30, 2014USD ($) |
Commitments and contingencies | ||||||
Purchase obligations | $ 142,100,000 | $ 142,100,000 | ||||
Purchase obligations due in fiscal 2017 | 94,300,000 | 94,300,000 | ||||
Outstanding standby letters of credit | 22,000,000 | 22,000,000 | ||||
Total accrued liability for self-insured plans | 64,100,000 | 64,100,000 | ||||
Number of present and former restaurant hourly employees filed a class action lawsuit | item | 5 | |||||
Payments required under event of an actual or constructive termination of employment | 2,200,000 | |||||
Accrued potential bonuses | 3,100,000 | 3,100,000 | ||||
Annual founder's retirement benefit for ten years after termination of full time employment | $ 650,000 | |||||
Number of years annual founder's retirement benefit after termination of full time employment | 10 years | |||||
Number of months annual founder's retirement benefit after termination of full time employment | 6 months | |||||
Aggregate minimum annual lease payments under operating leases | ||||||
2,017 | 87,907,000 | $ 87,907,000 | ||||
2,018 | 88,418,000 | 88,418,000 | ||||
2,019 | 89,087,000 | 89,087,000 | ||||
2,020 | 86,742,000 | 86,742,000 | ||||
2,021 | 83,314,000 | 83,314,000 | ||||
Thereafter | 585,737,000 | 585,737,000 | ||||
Total | 1,021,205,000 | 1,021,205,000 | ||||
Rent expense | ||||||
Straight-lined minimum base rent | 80,276,000 | $ 74,981,000 | $ 71,828,000 | |||
Contingent rent | 22,408,000 | 21,160,000 | 19,895,000 | |||
Common area maintenance and taxes | 36,252,000 | 34,602,000 | 31,074,000 | |||
Total | $ 138,936,000 | $ 130,743,000 | $ 122,797,000 | |||
North Italia and Flower Child | ||||||
Commitments and contingencies | ||||||
Obligations | $ 42,000,000 | |||||
Internal Revenue Service (IRS) | ||||||
Commitments and contingencies | ||||||
Notice of proposed adjustment in IRS proposed disallowance | $ 12,900,000 | |||||
Minimum | ||||||
Commitments and contingencies | ||||||
Operating lease remaining terms, excluding unexercised renewal options | 1 year | |||||
Contingent rent as a percentage of revenues | 3.00% | |||||
Minimum | North Italia and Flower Child | ||||||
Commitments and contingencies | ||||||
Number of years | 3 years | |||||
Maximum | ||||||
Commitments and contingencies | ||||||
Operating lease remaining terms, excluding unexercised renewal options | 20 years | |||||
Contingent rent as a percentage of revenues | 10.00% | |||||
Maximum | North Italia and Flower Child | ||||||
Commitments and contingencies | ||||||
Number of years | 5 years |
Stockholders' Equity (Details)
Stockholders' Equity (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||||
Jan. 03, 2017 | Sep. 27, 2016 | Jun. 28, 2016 | Mar. 29, 2016 | Dec. 29, 2015 | Sep. 29, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Jan. 03, 2017 | Dec. 29, 2015 | Dec. 30, 2014 | Jul. 21, 2016 | |
Stockholders Equity: | ||||||||||||
Cash dividends declared per common share (in dollars per share) | $ 0.24 | $ 0.24 | $ 0.200 | $ 0.200 | $ 0.200 | $ 0.200 | $ 0.165 | $ 0.165 | $ 0.88 | $ 0.73 | $ 0.61 | |
Treasury stock repurchased during period | $ 146,467 | $ 109,371 | $ 140,483 | |||||||||
Repurchased shares since program inception | 46,979,659 | 44,064,322 | 46,979,659 | 44,064,322 | ||||||||
Treasury Stock | ||||||||||||
Stockholders Equity: | ||||||||||||
Number of shares authorized to be repurchased | 56,000,000 | |||||||||||
Additional number of shares authorized to repurchase | 7,500,000 | |||||||||||
Shares repurchased during period | 2,900,000 | 2,100,000 | 3,100,000 | |||||||||
Treasury stock repurchased during period | $ 146,500 | $ 104,800 | $ 143,200 |
Stockholders' Equity - Share Re
Stockholders' Equity - Share Repurchase Program (Details) - Collared Accelerated Repurchase Program - USD ($) shares in Millions, $ in Millions | Jul. 27, 2015 | Mar. 31, 2015 | Feb. 27, 2015 | Jul. 21, 2014 | Mar. 31, 2014 | Feb. 27, 2014 |
Share Repurchase Program | ||||||
Common stock repurchase authorized amount | $ 75 | $ 75 | ||||
Additional Shares Delivered Under Share Repurchase Program | 0 | 0.2 | ||||
Minimum | ||||||
Share Repurchase Program | ||||||
Number of shares authorized to be repurchased | 1.5 | 1.4 |
Stock-Based Compensation (Detai
Stock-Based Compensation (Details) - shares shares in Millions | 12 Months Ended | ||
Jan. 03, 2017 | Apr. 02, 2015 | Apr. 01, 2015 | |
Stock-Based Compensation | |||
Shares authorized for issuance under share-based compensation plan | 9.2 | 6.8 | |
Shares available for grant | 1.5 | ||
Stock Options | |||
Stock-Based Compensation | |||
Annual vesting rights (as a percent) | 20.00% | ||
Stock Options | Minimum | |||
Stock-Based Compensation | |||
Option expiration period (in years) | 8 years | ||
Stock Options | Maximum | |||
Stock-Based Compensation | |||
Option expiration period (in years) | 10 years | ||
Restricted shares and restricted share units | Minimum | |||
Stock-Based Compensation | |||
Annual vesting rights (as a percent) | 0.00% | ||
Vesting period (in years) | 3 years | ||
Restricted shares and restricted share units | Maximum | |||
Stock-Based Compensation | |||
Annual vesting rights (as a percent) | 125.00% | ||
Vesting period (in years) | 5 years |
Stock-Based Compensation - Net
Stock-Based Compensation - Net of Tax (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 03, 2017 | Dec. 29, 2015 | Dec. 30, 2014 | |
Stock-based compensation | |||
Stock-based compensation | $ 21,473 | $ 20,053 | $ 16,817 |
Income tax benefit | 8,213 | 7,670 | 6,433 |
Total stock-based compensation, net of taxes | 13,260 | 12,383 | 10,384 |
Capitalized stock-based compensation | 338 | 272 | 216 |
Labor expenses | |||
Stock-based compensation | |||
Stock-based compensation | 6,023 | 5,748 | 5,245 |
Other operating costs and expenses | |||
Stock-based compensation | |||
Stock-based compensation | 251 | 268 | 216 |
General and administrative expenses | |||
Stock-based compensation | |||
Stock-based compensation | $ 15,199 | $ 14,037 | $ 11,356 |
Stock-Based Compensation -Weigh
Stock-Based Compensation -Weighted Average Fair Value (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | ||
Jan. 03, 2017 | Dec. 29, 2015 | Dec. 30, 2014 | |
Stock Options | |||
Stock-Based Compensation | |||
Weighted average fair value at the grant date for options issued (in dollars per share) | $ 12.10 | $ 14.17 | $ 15.48 |
Weighted average assumptions under Black-Scholes valuation model | |||
Expected option term | 6 years 9 months 18 days | 6 years 7 months 6 days | 6 years 6 months |
Expected stock price volatility (as a percent) | 26.30% | 31.30% | 32.90% |
Risk free interest rate (as a percent) | 1.60% | 1.90% | 2.20% |
Dividend yield (as a percent) | 1.60% | 1.40% | 1.20% |
Shares | |||
Outstanding at beginning of year (in shares) | 3,066 | ||
Granted (in shares) | 225 | ||
Exercised (in shares) | (1,304) | ||
Forfeited or cancelled (in shares) | (32) | ||
Outstanding at end of year (in shares) | 1,955 | 3,066 | |
Exercisable at end of year (in shares) | 1,064 | ||
Weighted Average Exercise Price | |||
Outstanding at beginning of year (in dollars per share) | $ 30 | ||
Granted (in dollars per share) | 50.26 | ||
Exercised (in dollars per share) | 21.76 | ||
Forfeited or cancelled (in dollars per share) | 40.86 | ||
Outstanding at end of year (in dollars per share) | 37.65 | $ 30 | |
Exercisable at end of year (in dollars per share) | $ 31.69 | ||
Weighted Average Remaining Contractual Term | |||
Weighted Average Remaining Contractual Term (in years) | 4 years | 3 years 7 months 6 days | |
Exercisable at end of year (in years) | 2 years 9 months 18 days | ||
Aggregate Intrinsic Value | |||
Outstanding | $ 42,592 | $ 52,416 | |
Exercisable at end of year | 29,505 | ||
Total intrinsic value of options exercised | 40,400 | $ 37,000 | $ 28,200 |
Unrecognized stock-based compensation expense | |||
Total unrecognized stock-based compensation expenses related to unvested stock options, restricted shares and restricted share units | $ 8,000 | ||
Expected weighted average period for recognition of compensation expense related to unvested stock option | 2 years 7 months 6 days | ||
Restricted shares and restricted share units | |||
Unrecognized stock-based compensation expense | |||
Total unrecognized stock-based compensation expenses related to unvested stock options, restricted shares and restricted share units | $ 40,500 | ||
Expected weighted average period for recognition of compensation expense related to unvested stock option | 2 years 7 months 6 days | ||
Restricted Shares and Restricted Share Units | |||
Outstanding at beginning of year (in shares) | 1,891 | ||
Granted (in shares) | 458 | ||
Vested (in shares) | (368) | ||
Forfeited (in shares) | (120) | ||
Outstanding at end of year (in shares) | 1,861 | 1,891 | |
Fair value of shares vested | $ 12,200 | $ 7,500 | $ 4,500 |
Weighted Average Fair Value | |||
Outstanding at beginning of year (in dollars per share) | $ 41.31 | ||
Granted (in dollars per share) | 50.89 | $ 49.70 | $ 47.16 |
Vested (in dollars per share) | 33.07 | ||
Forfeited (in dollars per share) | 43.40 | ||
Outstanding at end of year (in dollars per share) | $ 45.11 | $ 41.31 |
Employee Benefit Plans (Details
Employee Benefit Plans (Details) $ in Millions | 12 Months Ended | |||
Jan. 03, 2017USD ($)item | Dec. 29, 2015USD ($) | Dec. 30, 2014USD ($) | Jan. 03, 2016USD ($) | |
Employee Benefit Plans | ||||
Number of restaurant concepts for which section 401(k) is open to participation by staff members | item | 3 | |||
Minimum number of investment options available to participating plan members | item | 1 | |||
Maximum amount of eligible bonuses that may be deferred by participating staff members under the ESP (as a percent) | 100.00% | |||
Accrued liability for self-insured benefit plans | $ 7.3 | $ 7.8 | ||
401(k) Plan | ||||
Employee Benefit Plans | ||||
Expense recognized | $ 0.9 | 0.7 | $ 0.6 | |
ESP | ||||
Employee Benefit Plans | ||||
Expense recognized | $ 1 | $ 0.9 | $ 0.8 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 03, 2017 | Dec. 29, 2015 | Dec. 30, 2014 | |
Income Taxes | |||
Income before income taxes | $ 191,768 | $ 159,352 | $ 138,544 |
Current: | |||
Federal | 42,665 | 32,765 | 28,687 |
State | 10,614 | 8,880 | 8,377 |
Total current | 53,279 | 41,645 | 37,064 |
Deferred: | |||
Federal | (564) | 2,659 | 480 |
State | (441) | (1,475) | (276) |
Total deferred | (1,005) | 1,184 | 204 |
Total provision | $ 52,274 | $ 42,829 | $ 37,268 |
Income Taxes Rate Reconciliation | |||
Tax at U.S. federal statutory rate (as a percent) | 35.00% | 35.00% | 35.00% |
State and district income taxes, net of federal income tax benefit (as a percent) | 3.50% | 3.00% | 3.80% |
FICA tip credit (as a percent) | (7.00%) | (8.00%) | (8.40%) |
Other credits and incentives (as a percent) | (1.30%) | (1.00%) | (0.70%) |
Manufacturing deduction (as a percent) | (2.50%) | (2.80%) | (2.90%) |
Deferred compensation (as a percent) | (0.50%) | 0.30% | (0.40%) |
Other (as a percent) | 0.10% | 0.40% | 0.50% |
Effective tax rate (as a percent) | 27.30% | 26.90% | 26.90% |
Deferred tax assets: | |||
Employee benefits | $ 32,258 | $ 28,856 | |
Insurance reserves | 20,932 | 19,399 | |
Accrued rent | 20,583 | 21,504 | |
Stock-based compensation | 15,384 | 16,100 | |
Deferred income | 14,409 | 11,406 | |
Tax credit carryforwards | 2,247 | 2,694 | |
Other | 957 | 794 | |
Subtotal | 106,770 | 100,753 | |
Less: Valuation allowance | (457) | (618) | |
Total | 106,313 | 100,135 | |
Deferred tax liabilities: | |||
Property and equipment | (166,183) | (160,764) | |
Inventory | (10,339) | (10,154) | |
Prepaid expenses | (12,192) | (11,741) | |
Total | (188,714) | (182,659) | |
Net deferred tax liability | (82,401) | (82,524) | |
Reconciliation of beginning and ending amount of our uncertain tax positions | |||
Balance at beginning of year | 1,067 | 875 | $ 802 |
Additions related to current period tax positions | 139 | 192 | 233 |
Reductions related to settlements with taxing authorities and lapses of statutes of limitations | (377) | 0 | (160) |
Balance at end of year | 829 | 1,067 | $ 875 |
Decrease in uncertain tax positions during the next twelve months based on the lapses of statutes of limitations for certain jurisdictions | 0 | ||
Accrued interest related with uncertain tax positions | 100 | 100 | |
State | |||
Tax credit carryforwards | |||
Tax credit carryforwards | 3,500 | 4,100 | |
Tax credit carryforward valuation allowance | $ 500 | $ 600 |
Stockholder Rights Plan (Detail
Stockholder Rights Plan (Details) - Junior participating cumulative preferred stock rights | 12 Months Ended |
Jan. 03, 2017item$ / sharesshares | |
Stockholder rights plan | |
Number of rights per common share | 1 |
Number of shares of junior participating cumulative preferred stock callable by rights | shares | 0.01 |
Rights exercise trigger, minimum percentage of stock acquired or intended to be acquired by an individual or group | 15.00% |
Rights exercise trigger, minimum percentage of stock acquired or intended to be acquired by a beneficial owner | 20.00% |
Beneficial ownership interest defined (as a percent) | 10.00% |
Multiplier of the exercise price that the holder of the rights would receive in value of other than the acquiring company's junior participating cumulative preferred stock | 2 |
Exercise price of junior participating cumulative preferred stock (in dollars per right) | $ / shares | $ 110 |
Percentage of assets or earning power sold or transferred allowing the rights holder the right to receive common stock of acquiring company | 50.00% |
Multiplier of the exercise price that the rights holder has right to receive in value of acquiring company's common stock | 2 |
Segment Information (Details)
Segment Information (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Jan. 03, 2017USD ($)item | Sep. 27, 2016USD ($) | Jun. 28, 2016USD ($) | Mar. 29, 2016USD ($) | Dec. 29, 2015USD ($) | Sep. 29, 2015USD ($) | Jun. 30, 2015USD ($) | Mar. 31, 2015USD ($) | Jan. 03, 2017USD ($)item | Dec. 29, 2015USD ($) | Dec. 30, 2014USD ($)item | |
Segment information | |||||||||||
Revenues | $ 603,146 | $ 560,018 | $ 558,862 | $ 553,693 | $ 526,841 | $ 526,688 | $ 529,107 | $ 517,973 | $ 2,275,719 | $ 2,100,609 | $ 1,976,624 |
Income/(loss) from operations | 47,146 | $ 50,063 | $ 55,190 | $ 48,594 | 38,795 | 35,644 | $ 49,753 | $ 41,054 | 200,993 | 165,246 | 144,731 |
Depreciation and amortization | 88,010 | 85,563 | 82,835 | ||||||||
Capital expenditures | 115,821 | 153,941 | 113,982 | ||||||||
Total assets | 1,293,319 | 1,233,346 | 1,293,319 | 1,233,346 | 1,161,376 | ||||||
The Cheesecake Factory restaurants | |||||||||||
Segment information | |||||||||||
Revenues | 2,078,083 | 1,913,758 | 1,792,796 | ||||||||
Income/(loss) from operations | 308,058 | 275,686 | 240,774 | ||||||||
Depreciation and amortization | 74,861 | 71,821 | 68,504 | ||||||||
Capital expenditures | 99,817 | 122,358 | 104,525 | ||||||||
Total assets | 950,372 | 934,606 | 950,372 | 934,606 | 861,697 | ||||||
Impairment and accelerated depreciation expense | $ 100 | $ 6,000 | $ 100 | 6,000 | $ 700 | ||||||
Number of restaurants related to planned relocation | item | 1 | 1 | 1 | ||||||||
Other | |||||||||||
Segment information | |||||||||||
Revenues | $ 197,636 | 186,851 | $ 183,828 | ||||||||
Income/(loss) from operations | 27,623 | 18,047 | 14,983 | ||||||||
Depreciation and amortization | 8,469 | 9,690 | 10,337 | ||||||||
Capital expenditures | 13,783 | 13,644 | 3,713 | ||||||||
Total assets | $ 157,842 | 152,243 | 157,842 | 152,243 | 154,033 | ||||||
Corporate Non Segment | |||||||||||
Segment information | |||||||||||
Income/(loss) from operations | (134,688) | (128,487) | (111,026) | ||||||||
Depreciation and amortization | 4,680 | 4,052 | 3,994 | ||||||||
Capital expenditures | 2,221 | 17,939 | 5,744 | ||||||||
Total assets | $ 185,105 | $ 146,497 | $ 185,105 | $ 146,497 | $ 145,646 |
Quarterly Financial Data (una62
Quarterly Financial Data (unaudited) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Jan. 03, 2017 | Sep. 27, 2016 | Jun. 28, 2016 | Mar. 29, 2016 | Dec. 29, 2015 | Sep. 29, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Jan. 03, 2017 | Dec. 29, 2015 | Dec. 30, 2014 | |
Selected Quarterly Financial Information [Abstract] | |||||||||||
Revenues | $ 603,146 | $ 560,018 | $ 558,862 | $ 553,693 | $ 526,841 | $ 526,688 | $ 529,107 | $ 517,973 | $ 2,275,719 | $ 2,100,609 | $ 1,976,624 |
Income from operations | 47,146 | 50,063 | 55,190 | 48,594 | 38,795 | 35,644 | 49,753 | 41,054 | 200,993 | 165,246 | 144,731 |
Net income | $ 32,381 | $ 34,574 | $ 38,585 | $ 33,954 | $ 27,200 | $ 26,176 | $ 34,724 | $ 28,423 | $ 139,494 | $ 116,523 | $ 101,276 |
Basic net income per share (in dollars per share) | $ 0.68 | $ 0.72 | $ 0.80 | $ 0.70 | $ 0.56 | $ 0.54 | $ 0.72 | $ 0.58 | $ 2.91 | $ 2.39 | $ 2.04 |
Diluted net income per share (in dollars per share) | 0.66 | 0.70 | 0.78 | 0.68 | 0.54 | 0.52 | 0.69 | 0.56 | 2.83 | 2.30 | 1.96 |
Cash dividends declared per common share (in dollars per share) | $ 0.24 | $ 0.24 | $ 0.200 | $ 0.200 | $ 0.200 | $ 0.200 | $ 0.165 | $ 0.165 | $ 0.88 | $ 0.73 | $ 0.61 |
Quarterly Financial Data - Asse
Quarterly Financial Data - Asset impairment (unaudited) (Details) - The Cheesecake Factory restaurants $ in Millions | 3 Months Ended | 12 Months Ended | |||
Jan. 03, 2017USD ($)item | Sep. 29, 2015USD ($) | Jan. 03, 2017USD ($)item | Dec. 29, 2015USD ($) | Dec. 30, 2014USD ($)item | |
Asset impairment | |||||
Impairment and accelerated depreciation expense | $ 0.1 | $ 6 | $ 0.1 | $ 6 | $ 0.7 |
Number of restaurants related to planned relocation | item | 1 | 1 | 1 | ||
Impact of impairment and lease termination expenses on net income | $ 0.1 | $ 3.6 |
Subsequent Event (Details)
Subsequent Event (Details) - $ / shares | Feb. 16, 2017 | Jan. 03, 2017 | Sep. 27, 2016 | Jun. 28, 2016 | Mar. 29, 2016 | Dec. 29, 2015 | Sep. 29, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Jan. 03, 2017 | Dec. 29, 2015 | Dec. 30, 2014 |
Subsequent events | ||||||||||||
Cash dividends declared per common share (in dollars per share) | $ 0.24 | $ 0.24 | $ 0.200 | $ 0.200 | $ 0.200 | $ 0.200 | $ 0.165 | $ 0.165 | $ 0.88 | $ 0.73 | $ 0.61 | |
Subsequent event | ||||||||||||
Subsequent events | ||||||||||||
Cash dividends declared per common share (in dollars per share) | $ 0.24 |