BJ's Restaurants, Inc. (BJRI, Financial) is a restaurant company that offers a diverse menu to its customers. Its restaurants operate under the BJ's Restaurant & Brewery BJ's Restaurant & Brewhouse, BJ's Pizza & Grill, or BJ's Grill names. Its offerings include BJ's deep-dish pizza, its hand-tossed style pizza, its craft beers and other beers, as well as a selection of appetizers, entrees, pastas, sandwiches, specialty salads and desserts, including its Pizookie dessert.
It owns and operates 159 restaurants as of April 2015, located in California, Texas, Florida, Arizona, Colorado, Nevada, Washington, Ohio, Oklahoma, Oregon, Kentucky, Indiana, Kansas, Louisiana, Maryland, New Mexico, Virginia, Arkansas, and New York.
First Quarter Results
Revenues
Total revenues increased by 9.4% and were $225.1 million.
Sales
Comparable restaurant sales increased 3.2%.
Net Income
Net income increased to $9.6 million from $4.7 million. Diluted net income per share increased to $0.36 from $0.16 (first quarter 2014 diluted net income per share of $0.16 was inclusive of a $0.04 diluted net income per share charge related to shareholder settlement costs).
Share Repurchases
BJRI repurchased approximately $6.8 million during the 2015 first quarter. Since the first share repurchase authorization was approved in April 2014, the Company has repurchased and retired approximately 3.0 million shares for approximately $107 million. The Company has approximately $43 million remaining under its current $150 million share repurchase authorization.
Miscellaneous
BJRI achieved solid leverage on positive comparable restaurant sales and generated first quarter four-wall restaurant level operating margins of 18.9%, marking a 180 basis points improvement from the prior year's first quarter.
Fourth Quarter Highlights (Compared to Fourth Quarter 2013)
Revenues
Revenues increased by 9.1% and were $845.6 million.
Sales
Comparable restaurant sales increased by 1.2%. Fourth quarter operating margins also benefited from continuing leverage of corporate overhead as general and administrative expenses declined by 40 basis points to 5.8% of sales.
Net Income
Net income increased to $8.3 million from $0.5 million. Diluted net income per share increased to $0.31 from $0.02.
(Source: Company’s Website)
Potential
The company has lot of growth opportunities in the near future. The company is presently aiming to become big by rapid expansions. The company is in plans to open around 15 outlets this year. Currently the company has 12 new restaurants under construction. BJRI expects to open 5 new restaurants in the second quarter of this year. The development team of the company is busy building a solid pipeline for fiscal 2016 and 2017 new restaurant openings. It plans to achieve 10% increase in operating weeks through new restaurant openings. The company is focusing on constant innovation and reducing capex.
In February BJRI introduced thin crust Tavern-Cut Pizza category. This came as a replacement to their hand-tossed product. This was accepted warmly by the customers.
To End
Over the years, their renowned beers have earned 25 medals at the Great American Beer Festival, including two Gold medals in 2008. BJ’s restaurant concept offers consumers a higher quality, more contemporary and approachable casual-plus dining experience with higher energy and relevance for about the same amount of money. The differentiated, high-quality, handcrafted beers have added a unique dimension to the BJ’s concept which further distinguishes BJ’s from many other restaurant concepts and compliments their signature pizza and many other menu items. Efficiencies derived from Project Q resulted in a solid start to fiscal 2015 and record first quarter results
BJRI demonstrated solid first quarter results and is expected to continue to do so in the coming future. For the third consecutive quarter, there was an increase of 3.2% in positive comparable sales. The company boasts of new menu offerings, affordability, speed and hospitality. It has managed to carve a niche for itself in the market. I would suggest a BUY for this company as I believe that BJRI is in a good position right now. It is a growth stock with plenty of opportunities.
