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Cheesecake Factory 2Q same-store sales rise 0.3%

Regional economic slowdowns in Texas and Florida hurt traffic

Operational efficiencies and favorable commodity costs helped The Cheesecake Factory Inc. post an 11-percent increase in second-quarter net income, the company said Wednesday.

For the June 28-ended quarter, the Calabasas Hills, Calif.-based company reported net income of $38.6 million, or 78 cents per share, compared with $34.7 million, or 69 cents per share, a year ago.

Revenue rose to $558.9 million, from $529.1 million a year ago.

Same-store sales for the casual-dining chain increased a modest 0.3 percent for the core Cheesecake Factory brand, including a roughly 2.9-percent increase in menu pricing and a 0.2-percent benefit from menu mix. Traffic declined 2.7 percent for the quarter, which executives blamed in part on regional economic challenges in Texas and Florida.

But David Overton, The Cheesecake Factory chairman and CEO, said the chain outperformed the casual-dining industry and delivered its 26th consecutive quarter of positive same-store sales.

“Capturing operational efficiencies, coupled with a benign commodity cost environment, enabled us to offset industry wage inflation and drive strong margins and earnings growth during the quarter,” Overton said in a statement. 

The company rolled out its mobile payment app CakePay nationwide during the quarter. MasterCard is expected to feature the app in an upcoming TV ad campaign for the Masterpass digital wallet solution, Overton said.

The chain also opened the first Cheesecake Factory in China, a flagship location at the Disneytown area of Shanghai Disney Resort, under a licensing agreement.

Overton said the chain has expanded its test of delivery with a third-party provider to most restaurants across California.

In fiscal 2016, The Cheesecake Factory plans to open as many as eight company-owned restaurants domestically, and four to five under licensing agreements internationally.

The Cheesecake Factory Inc. ended the quarter with 202 restaurants, including 180 of the namesake brand, 12 Grand Lux Cafes and one RockSugar Pan Asian Kitchen.

Contact Lisa Jennings at [email protected]
Follow her on Twitter: @livetodineout

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