Exhibit 99.1
BJ's Restaurants, Inc. Reports Strong Financial Results
for the Third Quarter of Fiscal 2006
HUNTINGTON BEACH, Calif.--(BUSINESS WIRE)--Oct. 26, 2006--BJ's
Restaurants, Inc. (NASDAQ:BJRI) today reported revenues and net income
for the third quarter of fiscal 2006 ended October 3, 2006.
Highlights for the 13 weeks ended October 3, 2006, compared to the
13 weeks ended October 4, 2005, were as follows:
-- Revenues increased approximately 30% to $61.8 million
-- Comparable restaurant sales increased 5.3%
-- Net income of approximately $2.4 million
-- Diluted net income per share of $0.10
During the first quarter of fiscal 2006, the Company adopted SFAS
No. 123 (Revised), "Share-Based Payment." SFAS No. 123R requires the
fair value measurement of all stock-based payments to employees,
including grants of stock options, and recognition of those expenses
in the Company's results of operations. The results for fiscal 2005 do
not include the impact of SFAS 123R. If the impact of SFAS 123R was
included on a pro-forma (non-GAAP) basis in the prior year's third
quarter, net income and diluted net income per share for the third
quarter of fiscal 2006 would have increased approximately 17% and 25%
respectively. Reconciliations between GAAP and non-GAAP results are
included in the accompanying financial data.
"BJ's leadership team was very pleased with our strong performance
during the third quarter," commented Jerry Deitchle, President and
CEO. "Our comparable restaurant sales increased a strong 5.3% during
the third quarter in spite of a very challenging sales and operating
environment for casual dining restaurants in general and successfully
rolled over a solid 5.5% increase achieved during the same quarter
last year. BJ's has now achieved 40 consecutive quarters of positive
comparable restaurant sales comparisons since our 1996 IPO, which is
truly an impressive accomplishment. We believe our consistent strong
sales growth during the past 10 years can be attributed to the
unusually broad 'approachability' of the BJ's concept to all consumer
demographics, coupled with our unwavering focus on delivering a higher
quality dining experience at a price point that remains the same or
lower than many of the 'mass market' casual dining restaurants with
which we compete. We believe our favorable competitive positioning
should continue to provide the 'oxygen' for BJ's future growth."
During the third quarter, the Company opened two new restaurants
(El Paso, TX and Temecula, CA) with initial sales volumes well in
excess of expectations. Three new restaurants (Bakersfield, CA;
Arlington, TX; and Aurora, CO) have already opened during the current
fourth quarter, with two of those restaurants opening on the same day.
The Company expects to open its 11th new restaurant during 2006 in
Reno, NV prior to Thanksgiving. "We are very pleased to have
accomplished our previously stated goal to open as many as 11 new
restaurants during 2006," commented Deitchle.
The Company continues to target capacity growth of 20% to 25%
during fiscal 2007, measured in terms of total restaurant operating
weeks. As many as 13 new restaurants are currently planned for 2007
openings. Nine signed leases or purchase agreements are already in
hand for those potential openings (with four of those restaurants
currently under construction). Another 15 signed letters of intent are
already in hand for potential 2007/2008 openings. "We continue to be
very pleased with the overall quality of our prospective restaurant
sites, as well as the capabilities and depth of our restaurant
construction and opening teams," said Deitchle. "We have solid
confidence in our ability to execute our 2007 new restaurant opening
plan."
As previously noted in the Company's 2005 annual report and
accompanying letter to shareholders, the Company is in the final
stages of structuring a meaningful performance-based equity incentive
plan, BJ's Gold Standard Stock Ownership Plan, for its restaurant
general managers, executive kitchen managers and field supervision
personnel. "The recruitment, retention and motivation of highly
qualified restaurant management personnel remains absolutely critical
to the successful execution of BJ's national restaurant expansion
plan, as well as to help maintain and improve the talent necessary to
provide consistent execution of our established high volume,
operationally complex restaurants," commented Deitchle. The new equity
incentive plan is currently expected to consist of awards of
restricted stock units that will require five-year service and
performance commitments. "This incentive plan will give us the ability
to compete for the very best restaurant management talent available,
and we are excited to offer it to our current restaurant management
team as well," said Deitchle. The annualized non-cash pre-tax
compensation expense associated with these awards is currently
expected to average approximately $16,000 per restaurant on an ongoing
basis. "We believe the modest cost of this plan will be recovered over
time by improved operational execution and lower expenses related to
restaurant manager turnover," commented Deitchle.
Effective the fiscal third quarter of 2005, the Company changed
its fiscal week-end from Sunday to Tuesday. This change was completed
to facilitate operational efficiencies by transferring certain
administrative tasks away from the weekends when its restaurants are
busiest. Accordingly, the thirteen weeks ended October 3, 2006 contain
91 days as compared to 93 days for the thirteen weeks ended October 4,
2005. The two additional days of operations contributed $705,000 of
additional revenues to the thirteen weeks ended October 4, 2005.
Investor Conference Call and Webcast
BJ's Restaurants, Inc. will conduct a conference call on its third
quarter earnings release today, October 26, 2006, at 2:00 p.m.
(Pacific). The Company will provide an Internet simulcast, as well as
a replay of the conference call. The link to the simulcast and
rebroadcast can be found on the Company's website at
http://www.bjsrestaurants.com. The rebroadcast will be available
following the live broadcast and continue for 30 days.
BJ's Restaurants, Inc. currently owns and operates 54 casual
dining restaurants under the BJ's Restaurant and Brewery, BJ's
Restaurant and Brewhouse or BJ's Pizza & Grill brand names. BJ's
restaurants offer an innovative and broad menu featuring
award-winning, signature deep-dish pizza complemented with generously
portioned salads, sandwiches, soups, pastas, entrees and desserts.
Quality, flavor, value, moderate prices and sincere service remain
distinct attributes of the BJ's experience. The Company operates 11
microbreweries which produce and distribute BJ's critically acclaimed
handcrafted beers throughout the chain. The Company's restaurants are
located in California (35), Texas (8), Arizona (4), Oregon (3),
Colorado (3) and Nevada (1). The Company also has a licensing interest
in a BJ's restaurant in Lahaina, Maui. Visit BJ's Restaurants, Inc. on
the web at http://www.bjsrestaurants.com.
Certain statements in the preceding paragraphs and all other
statements that are not purely historical constitute "forward-looking
statements" for purposes of the Securities Act of 1933 and the
Securities and Exchange Act of 1934, as amended, and are intended to
be covered by the safe harbors created thereby. Such statements
include disclosure regarding implementation of the Company's fiscal
2006 key initiatives, expectations as to restaurant openings and the
effects on SFAS 123R on diluted net income per share for future
periods. These forward-looking statements involve known and unknown
risks, uncertainties and other factors which may cause actual results
to be materially different from those projected or anticipated.
Factors that might cause such differences include, but are not limited
to: (i) our ability to manage an increasing number of new restaurant
openings, (ii) construction delays, (iii) labor shortages, (iv)
minimum wage increases (v) food quality and health concerns, (vi)
factors that impact California, where 35 of our current 54 restaurants
are located, (vii) restaurant and brewery industry competition, (viii)
impact of certain brewery business considerations, including without
limitation, dependence upon suppliers and related hazards, (ix)
consumer trends, (x) potential uninsured losses and liabilities, (xi)
fluctuating commodity costs including food and energy, (xii) trademark
and servicemark risks, (xiii) government regulations, (xiv) licensing
costs (xv) beer and liquor regulations, (xvi) loss of key personnel,
(xvii) inability to secure acceptable sites, (xviii) limitations on
insurance coverage, (xix) legal proceedings, (xx) other general
economic and regulatory conditions and requirements, (xxi) and
numerous other matters discussed in the Company's filings with the
Securities and Exchange Commission. BJ's Restaurants, Inc. undertakes
no obligation to update or alter its forward-looking statements
whether as a result of new information, future events or otherwise.
Further information concerning the Company's results of operations
for third quarter 2006 will be provided in the Company's Form 10-Q
filing, to be filed with the Securities and Exchange Commission by no
later than November 13, 2006.
For further information, please contact Greg Levin of BJ's
Restaurants, Inc. (714) 848-3747 ext. 240.
BJ's Restaurants, Inc.
Unaudited Consolidated Statements of Income
(Dollars in thousands except for per share data)
Thirteen Weeks Ended
-------------------------------
October 3, October 4,
2006 2005
-------------------------------
Revenues $61,796 100.0% $47,578 100.0%
Costs and expenses:
Cost of sales 16,043 26.0 12,057 25.3
Labor and benefits 21,427 34.7 17,201 36.2
Occupancy and operating expenses 12,039 19.5 9,103 19.1
General and administrative 5,099 8.3 3,430 7.2
Depreciation and amortization 2,619 4.2 1,835 3.9
Restaurant opening expense 1,308 2.1 899 1.9
-------------------------------
Total costs and expenses 58,535 94.8 44,525 93.6
-------------------------------
Income from operations 3,261 5.2 3,053 6.4
Other income:
Interest income, net 321 0.5 369 0.8
Other income, net 5 - 4 -
-------------------------------
Total other income 326 0.5 373 0.8
-------------------------------
Income before income taxes 3,587 5.7 3,426 7.2
Income tax expense 1,215 2.0 1,117 2.3
-------------------------------
Net income $2,372 3.7% $2,309 4.9%
===============================
Net income per share:
Basic $0.10 $0.10
======== ========
Diluted $0.10 $0.10
======== ========
Weighted average number of shares
outstanding:
Basic 22,918 22,682
======== ========
Diluted 23,693 24,001
======== ========
Thirty-Nine Weeks Ended
----------------------------------
October 3, October 4,
2006 2005
----------------------------------
Revenues $172,995 100.0% $128,956 100.0%
Costs and expenses:
Cost of sales 44,525 25.7 32,670 25.3
Labor and benefits 60,129 34.8 46,278 35.9
Occupancy and operating expenses 33,263 19.2 24,513 19.0
General and administrative 14,817 8.6 9,552 7.4
Depreciation and amortization 7,067 4.1 4,902 3.8
Restaurant opening expense 3,647 2.1 3,003 2.3
----------------------------------
Total costs and expenses 163,448 94.5 120,918 93.7
----------------------------------
Income from operations 9,547 5.5 8,038 6.3
Other income:
Interest income, net 1,089 0.6 762 0.6
Other income, net 37 - 121 0.1
----------------------------------
Total other income 1,126 0.6 883 0.7
----------------------------------
Income before income taxes 10,673 6.1 8,921 7.0
Income tax expense 3,650 2.1 2,885 2.2
----------------------------------
Net income $7,023 4.0% $6,036 4.8%
==================================
Net income per share:
Basic $0.31 $0.28
========== =========
Diluted $0.30 $0.26
========== =========
Weighted average number of shares
outstanding:
Basic 22,869 21,934
========== =========
Diluted 23,751 23,163
========== =========
Selected Balance Sheet Information
(Dollars in thousands)
October 3,
Balance Sheet Data (end of period): 2006 January 3,
(unaudited) 2006
----------- ----------
Cash, cash equivalents and short-term
investments $29,780 $49,847
Total assets $177,897 $163,958
Total long-term debt, including current portion $- $-
Shareholders' equity $140,534 $129,899
Thirteen Weeks Ended Thirty-Nine Weeks Ended
----------------------- ------------------------
October 3, October 4, October 3, October 4,
Supplemental 2006 2005 2006 2005
Information (1)
----------- ----------- ------------ -----------
Comparable restaurant
sales % change 5.3% 5.5% 6.0% 4.4%
Restaurants opened
during period 2 1 7 6
Restaurants open at
period-end 51 41 51 41
Restaurant operating
weeks 653 542 1,847 1,494
(1) Excludes the one licensed restaurant
Reconciliation of Non-GAAP Financial Measures
The following table illustrates the effect on net income and net
income per share if the Company had applied the fair value recognition
provisions of FAS 123R to all periods presented. This pro-forma
non-GAAP financial information includes financial measures which the
Company reconciles to the results reported in accordance with GAAP.
The Company believes that pro-forma non-GAAP reporting for prior
periods, giving effect to the adjustments shown in the reconciliation
below, is useful to investors to permit them to compare the Company's
results to prior periods using consistent assumptions regarding
stock-based compensation. In addition, the Company believes that its
competitors report similar non-GAAP financial information and, as a
result, investors, analysts and others in the investment community
expect such information to be reported as it allows them to better
compare the Company's results with those of its competitors. The
Company uses such non-GAAP financial measures to analyze and compare
the performance of its core business. The pro-forma non-GAAP financial
information presented herein should be considered supplemental to, and
not as a substitute for, or superior to, financial measures calculated
in accordance with GAAP.
(Unaudited, dollars in thousands except per share data)
Thirteen Weeks Ended
------------------------------
October 3, October 4,
2006 2005
(As Reported) (Pro Forma)
------------------------------
Net income before stock based
compensation $2,655 4.2% $2,309 4.8%(a)
Stock based compensation:
Labor and benefits (10) - (3) -
General and administrative (425) (0.7) (441) (0.9)
Tax benefit of stock based
compensation 152 0.2 160 0.3
------------------------ -----
Net income $2,372 3.7% $2,025 4.2%(b)
======================== =====
Basic net income per share:
Net income before stock based
compensation $0.11 $0.10 (a)
Stock based compensation, net (0.01) (0.01)
------- -------
Basic net income per share $0.10 $0.09 (b)
======= =======
Diluted net income per share:
Net income before stock based
compensation $0.11 $0.10 (a)
Stock based compensation, net (0.01) (0.02)
------- -------
Diluted net income per share $0.10 $0.08 (b)
======= =======
Thirty-Nine Weeks Ended
-------------------------------
October 3, October 4,
2006 2005
(As Reported) (Pro Forma)
-------------------------------
Net income before stock based
compensation $7,869 4.4% $6,036 4.8%(a)
Stock based compensation:
Labor and benefits (29) - (22) -
General and administrative (1,273) (0.7) (2,405) (1.9)
Tax benefit of stock based
compensation 456 0.3 876 0.7
------------------------- -----
Net income $7,023 4.0% $4,485 3.6%(b)
========================= =====
Basic net income per share:
Net income before stock based
compensation $0.35 $0.28 (a)
Stock based compensation, net (0.04) (0.08)
-------- -------
Basic net income per share $0.31 $0.20 (b)
======== =======
Diluted net income per share:
Net income before stock based
compensation $0.34 $0.26 (a)
Stock based compensation, net (0.04) (0.07)
-------- -------
Diluted net income per share $0.30 $0.19 (b)
======== =======
(a) Represents net income and basic and diluted net income per share
for the 2005 period under GAAP as reported in the Company's
filings with the Securities and Exchange Commission.
(b) Represents pro-forma non-GAAP net income and basic and diluted net
income per share for the 2005 period as if the Company had applied
the fair value recognition provisions of FAS 123R to prior
quarters.
CONTACT: BJ's Restaurants, Inc.
Greg Levin, 714-848-3747, ext. 240