BJs RESTAURANTS INC
For the period ended Apr 1, 2025. Filed May 5, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Apr 1, 2025 · Filed May 5, 2025
BJRI$55.67-4.8%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-10-01; filed 2024-11-04.
0000950170-24-120803
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-04-01; filed 2025-05-05.
0000950170-25-063508
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 65 previous paragraphs and 53 current paragraphs.
28 unchanged; 23 reworded; 2 added; 13 removed; 1 previous and 0 current paragraphs rearranged.
Tables are not compared: 4 previous and 4 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (2)
Current report
Cost of Sales. Cost of sales increased by $1.9 million, or 2.2%, to $86.8 million during the thirteen weeks ended April 1, 2025, from $85.0 million during the comparable thirteen-week period of 2024. This increase was primarily to support the higher sales at restaurants in our comparable restaurant sales base as well as our new restaurants. As a percentage of revenues, cost of sales decreased to 25.0% for the current thirteen-week period from 25.2% for the prior year comparable period. This decrease was primarily due to menu price increases offsetting inflationary pressures and the effectiveness of our cost savings initiatives.
Current report
Net cash provided by financing activities was $4.9 million during the thirteen weeks ended April 1, 2025, representing a $15.6 million increase from the $10.7 million used during the thirteen weeks ended April 2, 2024. The change over prior year is primarily due to increased borrowings on our line of credit, in part to fund the temporary working capital need due to the prepayment of accounts payable in connection with our ERP system migration at the end of the thirteen weeks ended April 1, 2025, offset by share repurchases.
Removed paragraphs (13)
Previous report
Cost of Sales. Cost of sales increased by $4.0 million, or 4.9%, to $86.7 million during the thirteen weeks ended October 1, 2024, from $82.7 million during the comparable thirteen-week period of 2023. This was primarily due to higher commodity costs related to poultry and avocados. As a percentage of revenues, cost of sales increased to 26.6% for the current thirteen-week period from 25.9% for the prior year comparable period. This increase was primarily due to higher commodity costs and a higher level of promotions, partially offset by menu price increases.
Previous report
Thirty-Nine Weeks Ended October 1, 2024 Compared to Thirty-Nine-Weeks Ended October 3, 2023
Previous report
Revenues. Total revenues increased by $3.4 million, or 0.3%, to $1.0 billion during the thirty-nine weeks ended October 1, 2024. The increase in revenues primarily consisted of an $18.5 million increase related to sales from new restaurants not yet in our comparable restaurant sales base, offset by a 0.2%, or $2.4 million, decline in comparable restaurant sales, an $11.2 million decrease related to closed restaurants, and $1.5 million primarily related to gift card breakage and loyalty redemptions. The decrease in comparable restaurant sales was due to a decrease in guest traffic of approximately 2.5%, offset by an increase in average check of approximately 2.3%, resulting from menu price increases and changes in mix.
Previous report
Cost of Sales. Cost of sales decreased by $2.7 million, or 1.0%, to $261.5 million during the thirty-nine weeks ended October 1, 2024, from $264.1 million during the comparable thirty-nine-week period of 2023. This was primarily due to the effects of our cost savings initiatives, partially offset by higher commodity costs and a higher level of promotions. As a percentage of revenues, cost of sales decreased to 25.8% for the current thirty-nine-week period from 26.2% for the prior year comparable period. This decrease was primarily due to a higher revenue base, menu price increases and the effectiveness of our cost savings initiative, partially offset by higher commodity costs and a higher level of promotions.
Previous report
Labor and Benefits. Labor and benefit costs for our restaurants decreased by $1.0 million, or 0.3%, to $372.0 million during the thirty-nine weeks ended October 1, 2024, from $373.1 million during the comparable thirty-nine-week period of 2023. This was primarily due to $2.3 million related to lower hourly labor and $1.5 million related to lower workers’ compensation, offset by $2.1 million related to increased management compensation costs and $0.7 million related to taxes and benefits. As a percentage of revenues, labor and benefit costs decreased to 36.7% for the current thirty-nine-week period from 37.0% for the prior year comparable period. This decrease was primarily due to improved labor efficiency and the effectiveness of our cost savings initiatives. Included in labor and benefits for the thirty-nine weeks ended October 1, 2024 and October 3, 2023, was approximately $1.8 million and $1.9 million, respectively, or 0.2% of revenues of stock-based compensation expense, related to equity awards granted in accordance with our Gold Standard Stock Ownership Program for certain restaurant management team members.
Previous report
Occupancy and Operating. Occupancy and operating expenses decreased by $4.3 million, or 1.8%, to $236.7 million during the thirty-nine weeks ended October 1, 2024, from $241.1 million during the comparable thirty-nine-week period of 2023. This was primarily due to decreases of $4.1 million in restaurant facilities expenses, $1.0 million related to equipment rental, $0.9 million in utilities, and $0.3 million in delivery-related fees and expenses, offset by a $1.0 million increase in credit card processing fees and $1.3 million in marketing expenditures. As a percentage of revenues, occupancy and operating expenses decreased to 23.4% for the current thirty-nine-week period from 23.9% for the prior year comparable period. This decrease was primarily related to improved operational efficiency and the effectiveness of our cost savings initiatives.
Previous report
General and Administrative. General and administrative expenses increased by $4.2 million, or 6.9%, to $64.6 million during the thirty-nine weeks ended October 1, 2024, from $60.4 million during the comparable thirty-nine-week period of 2023. This was primarily due to increases of $2.1 million in legal fees, $1.9 million in personnel related costs, $1.1 million in corporate expenses related to meeting costs and software amortization, $0.9 million related to our deferred compensation liability, $0.2 million in travel related expenses, and $0.2 million related to recruiting, offset by lower stock-based compensation expense of $1.8 million, and a $0.8 million decrease in incentive compensation. General and administrative costs for the thirty-nine weeks ended October 1, 2024 included a net charge of $1.7 million related to our leadership transition and severance, relocation and signing bonus expenses, $1.5 million of legal costs related to shareholder cooperation agreements and related matters, and $0.3 million in severance related to personnel changes, offset by a $2.1 million stock-based compensation credit related to the reversal of previously awarded stock-based compensation expense in conjunction with our leadership transition. As a percentage of revenues, general and administrative expenses increased to 6.4% for the current thirty-nine-week period from 6.0% for the prior year comparable period. This increase was primarily related to increased legal and corporate expenses arising in connection with our previously announced cooperation agreements and related matters with certain investors. Included in general and administrative costs was stock-based compensation expense of approximately $4.4 million and $6.2 million, or 0.4% and 0.6% of revenues for the thirty-nine weeks ended October 1, 2024 and October 3, 2023, respectively.
Previous report
Depreciation and Amortization. Depreciation and amortization increased by $1.0 million, or 1.9%, to $54.2 million during the thirty-nine weeks ended October 1, 2024, compared to $53.2 million during the comparable thirty-nine-week period of 2023. This increase was primarily related to depreciation expense related to our restaurants opened since the thirty-nine weeks ended October 3, 2023, partially offset by the impact of impairment and disposal charges taken in the prior year, and the closure of two restaurants since the thirty-nine weeks ended October 3, 2023. As a percentage of revenues, depreciation and amortization increased to 5.4% for the current thirty-nine-week period from 5.3% for the prior year comparable period. This increase was primarily due to increased depreciation expense.
Previous report
Restaurant Opening. Restaurant opening expense decreased by $0.6 million, or 22.9%, to $2.0 million during the thirty-nine weeks ended October 1, 2024, compared to $2.6 million during the comparable thirty-nine-week period of 2023. This decrease was primarily due to the timing of openings.
Previous report
Loss on Disposal and Impairment of Assets, Net. Loss on disposal and impairment of assets, net, was $3.0 million during the thirty-nine weeks ended October 1, 2024, and $4.7 million during the comparable thirty-nine-week period of 2023. For the thirty-nine weeks ended October 1, 2024, the cost primarily related to the impairment and reduction in the carrying value of the long-lived assets related to one of our restaurants, coupled with the disposals of assets in conjunction with initiatives to keep our restaurants up to date. For the thirty-nine weeks ended October 3, 2023, these costs primarily relate to disposals of assets in conjunction with initiatives to keep our restaurants up to date, including our restaurant remodel initiative and the removal of glass partitions in our dining rooms that were installed during the pandemic, as well as the closure of four under-performing restaurants.
Previous report
Interest Expense, Net. Interest expense, net, increased by $0.8 million to $4.0 million during the thirty-nine weeks ended October 1, 2024, compared to $3.2 million during the comparable thirty-nine-week period of 2023. This increase was primarily due to the increase in weighted average interest rate year over year, coupled with a higher average outstanding debt balance.
Previous report
Other Income, Net. Other income, net, increased by $3.4 million to $4.2 million of income during the thirty-nine weeks ended October 1, 2024, compared to $0.8 million during the comparable thirty-nine-week period of 2023. This increase was primarily related to a payroll tax credit.
Previous report
Net cash used in financing activities was $19.5 million during the thirty-nine weeks ended October 1, 2024, representing a $14.9 million increase from the $4.6 million used during the thirty-nine weeks ended October 3, 2023. The increase over prior year is primarily due to an increase in shares repurchased.
Reworded paragraphs (23)
Previous wording
Certain information included in this Form 10-Q and other filings with the Securities and Exchange Commission, in our press releases, in other written communications, and in oral statements made by or with the approval of one of our authorized officers may contain “forward-looking” statements about our current and expected performance trends, growth plans, business goals and other matters. Words or phrases such as “believe,” “plan,” “will likely result,” “expect,” “intend,” “will continue,” “is anticipated,” “estimate,” “project,” “may,” “could,” “would,” “should,” and similar expressions are intended to identify “forward-looking” statements. These statements, and any other statements that are not historical facts, are “forward-looking” statements within the meaning of the Private Securities Litigation Reform Act of 1995, as codified in Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, as amended from time to time. The cautionary statements made in this Form 10-Q should be read as being applicable to all related “forward-looking” statements wherever they appear in this Form 10-Q. These forward-looking statements are based on information available to us as of the date any such statements are made, and we assume no obligation to update these forward-looking statements. These statements are subject to risks and uncertainties that could cause actual results to differ materially from those described in the statements. These risks and uncertainties include, but are not limited to, the risk factors described in Item 1A of our Annual Report on Form 10-K for the fiscal year ended January 2, 2024, as updated in our Form 10-Q for the thirty-nine weeks ended October 1, 2024, and in other reports filed subsequently with the SEC.
Current wording
Certain information included in this Form 10-Q and other filings with the Securities and Exchange Commission, in our press releases, in other written communications, and in oral statements made by or with the approval of one of our authorized officers may contain “forward-looking” statements about our current and expected performance trends, growth plans, business goals and other matters. Words or phrases such as “believe,” “plan,” “will likely result,” “expect,” “intend,” “will continue,” “is anticipated,” “estimate,” “project,” “may,” “could,” “would,” “should,” and similar expressions are intended to identify “forward-looking” statements. These statements, and any other statements that are not historical facts, are “forward-looking” statements within the meaning of the Private Securities Litigation Reform Act of 1995, as codified in Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, as amended from time to time. The cautionary statements made in this Form 10-Q should be read as being applicable to all related “forward-looking” statements wherever they appear in this Form 10-Q. These forward-looking statements are based on information available to us as of the date any such statements are made, and we assume no obligation to update these forward-looking statements. These statements are subject to risks and uncertainties that could cause actual results to differ materially from those described in the statements. These risks and uncertainties include, but are not limited to, the risk factors described in Item 1A of our Annual Report on Form 10-K for the fiscal year ended December 31, 2024, as updated in our Form 10-Q for the thirteen weeks ended April 1, 2025, and in other reports filed subsequently with the SEC.
Previous wording
BJ’s Restaurants is a leading casual dining restaurant brand differentiated by a high-quality, varied menu with compelling value, and a dining experience that offers our customers (referred to as “guests”) best-in-class service, hospitality and enjoyment, in a high-energy, welcoming and approachable atmosphere. As of November 4, 2024, BJ's owns and operates 218 restaurants located in 31 states.
Current wording
BJ’s Restaurants is a leading full-service restaurant brand differentiated by a high-quality, varied menu with compelling value, a dining experience that offers our customers (referred to as “guests”) best-in-class service, hospitality and enjoyment, in a high-energy, welcoming and approachable atmosphere. BJ’s is a national restaurant chain that, as of May 5, 2025, owns and operates 219 restaurants located in 31 states.
Previous wording
The first BJ’s restaurant opened in 1978 in Orange County, California, and was a small sit-down pizzeria that featured Chicago style deep-dish pizza with a unique California twist. In 1996, we introduced our proprietary craft beers and expanded the BJ’s concept to a full-service, high-energy casual dining restaurant when we opened our first large format restaurant with an on-site brewing operation in Brea, California. Today our restaurants feature a broad menu with approximately 100 menu items designed to offer something for everyone including: slow roasted entrees such as prime rib, EnLIGHTened Entrees® such as our Cherry Chipotle Glazed Salmon, our original signature deep-dish pizza, and the world-famous Pizookie® dessert. We also offer our award-winning BJ’s craft beers, which are produced at four in-house brewing facilities, two standalone brewpubs and by independent third-party brewers using our proprietary recipes, alongside a full bar featuring innovative cocktails.
Current wording
The first BJ’s restaurant opened in 1978 in Orange County, California, and was a small sit-down pizzeria that featured Chicago style deep-dish pizza with a unique California twist. In 1996, we introduced our proprietary craft beers and expanded the BJ’s concept to a full-service, high-energy restaurant when we opened our first large format restaurant with an on-site brewing operation in Brea, California. Today our restaurants feature a broad menu with approximately 100 menu items designed to offer something for everyone including: slow roasted entrees such as prime rib, EnLIGHTened Entrees® such as our Cherry Chipotle Glazed Salmon, our original signature deep-dish pizza, and the world-famous Pizookie® dessert. We also offer our award-winning BJ’s craft beers, which are produced at four in-house brewing facilities, two standalone brewpubs and by independent third-party brewers using our proprietary recipes, alongside a full bar featuring innovative cocktails.
Previous wording
Our revenues are comprised of food and beverage sales from our restaurants, including takeout, delivery and catering sales. Revenues from restaurant sales are recognized when payment is tendered. Amounts paid with a credit card are recorded in accounts and other receivables until payment is collected from the credit card processor. We sell gift cards which do not have an expiration date, and we do not deduct non-usage fees from outstanding gift card balances. Gift card sales are recorded as a liability and recognized as revenues upon redemption in our restaurants. A portion of our gift card sales are not expected to be redeemed and will be recognized as gift card “breakage.” Estimated gift card breakage is recorded as revenue and recognized in proportion to our historical redemption pattern, unless there is a legal obligation to remit the unredeemed gift cards to government authorities.
Current wording
Our revenues are comprised of food and beverage sales from our restaurants, including takeout, delivery and catering sales. Revenues from restaurant sales are recognized when payment is tendered. Amounts paid with a credit card are recorded in accounts and other receivables until payment is collected from the credit card processor. We sell gift cards which do not have an expiration date, and we do not deduct non-usage fees from outstanding gift card balances. Gift card sales are recorded as a liability and recognized as revenues upon redemption in our restaurants. Based on historical redemption rates, a portion of our gift card sales are not expected to be redeemed and will be recognized as gift card “breakage.” Estimated gift card breakage is recorded as revenue and recognized in proportion to our historical redemption pattern, unless there is a legal obligation to remit the unredeemed gift cards to government authorities.
Previous wording
Our guest loyalty program enables participants to earn points for qualifying purchases that can be redeemed for food and beverages in the future. We allocate the transaction price between the goods delivered and the future goods that will be delivered, on a relative standalone selling price basis, and defer the revenues allocated to the points until such points are redeemed.
Current wording
Our guest loyalty program enables participants to earn points for qualifying purchases that can be redeemed for food and beverages in the future. We allocate the transaction price between the goods delivered and the future goods that will be delivered, on a relative standalone selling price basis, and defer the revenues allocated to the points, less expected expirations, until such points are redeemed.
Previous wording
The following table provides, for the periods indicated, our unaudited Consolidated Statements of Operations expressed as percentages of total revenues. The results of operations for the thirteen and thirty-nine weeks ended October 1, 2024 and October 3, 2023, are not necessarily indicative of the results to be expected for the full fiscal year. Percentages below may not reconcile due to rounding.
Current wording
The following table provides, for the periods indicated, our unaudited Consolidated Statements of Operations expressed as percentages of total revenues. The results of operations for the thirteen weeks ended April 1, 2025 and April 2, 2024, are not necessarily indicative of the results to be expected for the full fiscal year. Percentages below may not reconcile due to rounding.
Previous wording
Revenues. Total revenues increased by $7.1 million, or 2.2%, to $325.7 million during the thirteen weeks ended October 1, 2024, from $318.6 million during the comparable thirteen-week period of 2023. The increase in revenues primarily consisted of a 1.7%, or $5.2 million, increase in comparable restaurant sales, and $5.4 million related to sales from new restaurants not yet in our comparable restaurant sales base. This increase was offset by a $2.7 million decrease related to closed restaurants and $0.7 million primarily related to gift card breakage and loyalty redemptions. The increase in comparable restaurant sales was due to an increase in guest traffic of approximately 1.3%, coupled with an increase in average check of approximately 0.4%, resulting from menu price increases, changes in mix and a higher level of promotions.
Current wording
Revenues. Total revenues increased by $10.6 million, or 3.2%, to $348.0 million during the thirteen weeks ended April 1, 2025, from $337.3 million during the comparable thirteen-week period of 2024. The increase in revenues primarily consisted of a 1.7%, or $5.7 million, increase in comparable restaurant sales, and $4.8 million related to sales from new restaurants not yet in our comparable restaurant sales base. The increase in comparable restaurant sales was due to an increase in guest traffic of approximately 2.7%, offset by an average check decrease of approximately 1.0%, resulting from changes in mix, partially mitigated by menu price increases.
Previous wording
Labor and Benefits. Labor and benefit costs for our restaurants increased by $2.5 million, or 2.1%, to $120.7 million during the thirteen weeks ended October 1, 2024, from $118.2 million during the comparable thirteen-week period of 2023. This was primarily due to $1.5 million related to higher management compensation, $0.9 million related to higher hourly labor, $0.8 million in taxes and benefits, and $0.1 million in higher stock-based compensation expense, offset by $0.9 million related to lower workers’ compensation costs. As a percentage of revenues, labor and benefit costs remained consistent at 37.1% for the current thirteen-week period and the prior year comparable period. Included in labor and benefits for the thirteen weeks ended October 1, 2024 and October 3, 2023, was approximately $0.7 million and $0.6 million, respectively, or 0.2%, of revenues of stock-based compensation expense, related to equity awards granted in accordance with our Gold Standard Stock Ownership Program for certain restaurant management team members.
Current wording
Labor and Benefits. Labor and benefit costs for our restaurants increased by $0.6 million, or 0.5%, to $125.7 million during the thirteen weeks ended April 1, 2025, from $125.0 million during the comparable thirteen-week period of 2024. This increase was primarily due to $0.5 million related to higher management compensation, $0.9 million in taxes and benefits, and $0.4 million related to higher workers’ compensation costs, offset by $1.1 million related to lower hourly labor and $0.1 million related to lower stock-based compensation. As a percentage of revenues, labor and benefit costs decreased to 36.1% for the current thirteen-week period from 37.1% for the prior year comparable period. This decrease was primarily due to leveraging our comparable restaurant growth and improved labor efficiency driven by our cost savings initiatives. Included in labor and benefits for the thirteen weeks ended April 1, 2025 and April 2, 2024, was approximately $0.4 million and $0.5 million, or 0.1% and 0.2% of revenues, respectively, of stock-based compensation expense related to equity awards granted in accordance with our Gold Standard Stock Ownership Program for certain restaurant management team members.
Previous wording
Occupancy and Operating. Occupancy and operating expenses increased by $0.3 million, or 0.4%, to $80.3 million during the thirteen weeks ended October 1, 2024, from $80.0 million during the comparable thirteen-week period of 2023. This was primarily due to increases of $1.2 million in marketing-related expenses, offset by decreases of $0.9 million in restaurant facility expenses. As a percentage of revenues, occupancy and operating expenses decreased to 24.7% for the current thirteen-week period from 25.1% for the prior year comparable period. This decrease was primarily related to improved operational efficiency and the effectiveness of our cost savings initiatives, coupled with a higher revenue base.
Current wording
Occupancy and Operating. Occupancy and operating expenses increased by $3.1 million, or 4.0%, to $79.9 million during the thirteen weeks ended April 1, 2025, from $76.9 million during the comparable thirteen-week period of 2024. This was primarily due to increases of $0.9 million in marketing-related expenses, $0.8 million in third party delivery fees, $0.8 million in utilities, $0.8 million in repairs and maintenance, $0.2 million in credit card processing fees, $0.2 million in license fees and $0.2 million in equipment rental, offset by decreases of $0.8 million in supplies and $0.3 million in restaurant facility expenses. As a percentage of revenues, occupancy and operating expenses increased to 23.0% for the current thirteen-week period from 22.8% for the prior year comparable period. This increase was primarily related to our investment in increased marketing with the goal of driving incremental sales.
Previous wording
General and Administrative. General and administrative expenses increased by $1.5 million, or 7.6%, to $21.0 million during the thirteen weeks ended October 1, 2024, from $19.5 million during the comparable thirteen-week period of 2023. This was primarily due to increases of $1.7 million in personnel related costs, $0.8 million related to our deferred compensation liability, $0.4 million in legal fees, $0.3 million in office expenses, and $0.3 million in recruiting related expenses, offset by lower stock-based compensation of $1.9 million, and incentive compensation of $0.4 million. General and administrative expenses during the thirteen weeks ended October 1, 2024 included a net charge of $1.7 million related to our leadership transition and severance, relocation and signing bonus expenses, offset by a $2.1 million stock-based compensation credit related to the reversal of previously awarded stock-based compensation expense in conjunction with our leadership transition. As a percentage of revenues, general and administrative expenses increased to 6.4% for the current thirteen-week period from 6.1% for the prior year comparable period. This increase is primarily related to increased deferred compensation liability and personnel costs, coupled with legal and recruiting fees, offset by lower stock-based compensation expense related to our leadership transition. Included in general and administrative costs was stock-based compensation expense of approximately $0.2 million and $2.1 million, or 0.1% and 0.7% of revenues for the thirteen weeks ended October 1, 2024 and October 3, 2023, respectively.
Current wording
General and Administrative. General and administrative expenses decreased by $1.2 million, or 5.4%, to $21.8 million during the thirteen weeks ended April 1, 2025, from $23.0 million during the comparable thirteen-week period of 2024. This was primarily due to decreases of $1.2 million in legal fees, $0.8 million related to our deferred compensation liability, and $0.4 million lower stock-based compensation, offset by increases of $0.5 million related to incentive compensation, $0.5 million in external services, and $0.3 million in recruiting related expenses. As a percentage of revenues, general and administrative expenses decreased to 6.3% for the current thirteen-week period from 6.8% for the prior year comparable period. This decrease was primarily due to our ability to leverage our fixed costs over a higher revenue base. Included in general and administrative costs was stock-based compensation expense of approximately $1.5 million and $2.0 million, or 0.4% and 0.6% of revenues for the thirteen weeks ended April 1, 2025 and April 2, 2024, respectively.
Previous wording
Depreciation and Amortization. Depreciation and amortization increased by $0.3 million, or 1.8%, to $18.2 million during the thirteen weeks ended October 1, 2024, compared to $17.9 million during the comparable thirteen-week period of 2023. This increase was primarily related to depreciation expense related to our restaurants opened since the thirteen weeks ended October 3, 2023, coupled with depreciation related to our remodeled restaurants, partially offset by the impact of impairment and disposal charges taken in the prior year, and the closure of two restaurants since the thirteen weeks ended October 3, 2023. As a percentage of revenues, depreciation and amortization remained consistent at 5.6% for the current thirteen-week period and the prior year comparable period.
Current wording
Depreciation and Amortization. Depreciation and amortization increased by $0.4 million, or 2.3%, to $18.3 million during the thirteen weeks ended April 1, 2025, compared to $17.9 million during the comparable thirteen-week period of 2024. This increase was primarily related to depreciation expense related to our restaurants opened since the thirteen weeks ended April 2, 2024, coupled with depreciation related to our remodeled restaurants. As a percentage of revenues, depreciation and amortization remained consistent at 5.3% for the current thirteen-week period and the prior year comparable period.
Previous wording
Restaurant Opening. Restaurant opening expense decreased by $0.3 million, or 19.1%, to $1.1 million during the thirteen weeks ended October 1, 2024, compared to $1.4 million during the comparable thirteen-week period of 2023. This decrease was primarily due to the timing of openings.
Current wording
Restaurant Opening. Restaurant opening expense decreased by $0.2 million, or 25.8%, to $0.4 million during the thirteen weeks ended April 1, 2025, compared to $0.6 million during the comparable thirteen-week period of 2024. This decrease was primarily due to the timing of openings.
Previous wording
Loss on Disposal and Impairment of Assets, Net. Loss on disposal and impairment of assets, net, was $0.3 million during the thirteen weeks ended October 1, 2024, and $1.4 million during the comparable thirteen-week period of 2023. For the thirteen weeks ended October 1, 2024, the costs primarily related to disposals of assets in conjunction with initiatives to keep our restaurants up to date. For the thirteen weeks ended October 3, 2023, the costs primarily related to disposals of assets in conjunction with initiatives to keep our restaurants up to date as well as the closure of an under-performing restaurant in the quarter.
Current wording
Loss on Disposal and Impairment of Assets, Net. Loss on disposal and impairment of assets, net, was $0.2 million during the thirteen weeks ended April 1, 2025, and $0.8 million during the comparable thirteen-week period of 2024. These costs primarily related to disposals of assets in conjunction with initiatives to keep our restaurants up to date.
Previous wording
Interest Expense, Net. Interest expense, net, increased by $0.3 million to $1.3 million during the thirteen weeks ended October 1, 2024, compared to $1.0 million during the comparable thirteen-week period of 2023. This increase was primarily due to the increase in weighted average interest rate year over year, coupled with a higher average outstanding debt balance.
Current wording
Interest Expense, Net. Interest expense, net, decreased by $0.2 million to $1.2 million during the thirteen weeks ended April 1, 2025, compared to $1.4 million during the comparable thirteen-week period of 2024. This decrease was primarily due to a lower weighted average interest rate year over year, partially offset by a higher average outstanding debt balance.
Previous wording
Other Income, Net. Other income, net, increased to $0.8 million of income during the thirteen weeks ended October 1, 2024. This increase was primarily related to gains associated with the cash surrender value of certain life insurance policies under our deferred compensation plan.
Current wording
Other (Expense) Income, Net. Other (expense) income, net, was $0.1 million of expense during the thirteen weeks ended April 1, 2025, compared to income of $0.7 million during the comparable thirteen-week period of 2024. This change was primarily related to the change in the cash surrender value of certain life insurance policies under our deferred compensation plan.
Previous wording
Income Tax Benefit. Our effective income tax rate for the thirteen weeks ended October 1, 2024, was a benefit of 8.2% compared to an expense of 11.8% for the comparable thirteen-week period of 2023. The effective tax rate for the thirteen weeks ended October 1, 2024 and October 3, 2023 was different than the statutory rate primarily due to FICA tax tip credits.
Current wording
Income Tax Benefit. Our effective income tax rate for the thirteen weeks ended April 1, 2025, was an expense of 1.2% compared to a benefit of 2.4% for the comparable thirteen-week period of 2024. The effective tax rate expense and benefit, respectively, for the thirteen weeks ended April 1, 2025 and April 2, 2024 was different than the statutory rate primarily due to FICA tax tip credits.
Previous wording
Our capital requirements are driven by our fundamental financial objective to improve total shareholder return through a balanced approach of new restaurant expansion plans, enhancements and initiatives focused on existing restaurants and return of capital to our shareholders through our share repurchase program. In addition, we want to maintain a flexible balance sheet to provide the financial resources necessary to manage the risks and uncertainties of conducting our business operations in the restaurant industry. In order to achieve these objectives, we use a combination of operating cash flows, debt, landlord allowances and proceeds from stock option exercises.
Current wording
Our capital requirements are driven by our fundamental financial objective to improve total shareholder return through a balanced approach of new restaurant expansion plans, enhancements and initiatives focused on existing restaurants and return of capital to our shareholders through our share repurchase program. We expect to accelerate restaurant openings in 2026. Our capital expenditures in 2025, related to future restaurant openings, will depend on the speed at which we can develop a more robust and targeted pipeline that aligns with our refined criteria for new locations. In addition, we want to maintain a flexible balance sheet to provide the financial resources necessary to manage the risks and uncertainties of conducting our business operations in the restaurant industry. In order to achieve these objectives, we use a combination of operating cash flows, debt, and landlord allowances.
Previous wording
Net cash provided by operating activities was $69.8 million during the thirty-nine weeks ended October 1, 2024, representing a $3.8 million decrease from the $73.6 million provided during the thirty-nine weeks ended October 3, 2023. The decrease over prior year is primarily due to the timing of accounts receivable receipts coupled with the timing of accounts payable and accrued expense payments, offset by improved net income.
Current wording
Net cash provided by operating activities was $4.6 million during the thirteen weeks ended April 1, 2025, representing a $17.7 million decrease from the $22.3 million provided during the thirteen weeks ended April 2, 2024. The decrease over prior year is primarily due to the timing of accounts payable, offset by improved net income. We successfully upgraded to a new Enterprise Resource Planning (“ERP”) system at the end of the first quarter of 2025. In preparation for the migration, we prepaid invoices, which reduced our accounts payable balance and decreased our operating cash flow for the period.
Previous wording
Net cash used in investing activities was $61.0 million during the thirty-nine weeks ended October 1, 2024, representing a $20.9 million decrease from the $82.0 million used during the thirty-nine weeks ended October 3, 2023. The decrease over prior year is primarily due to the number of new restaurant openings coupled with the timing of restaurant remodel activity.
Current wording
Net cash used in investing activities was $16.6 million during the thirteen weeks ended April 1, 2025, representing a $5.2 million decrease from the $21.9 million used during the thirteen weeks ended April 2, 2024. The decrease over prior year is primarily due to the number of new restaurant openings coupled with the timing of restaurant remodel activity.
Previous wording
As of November 4, 2024, we have opened three new restaurants and closed one restaurant this year. We currently anticipate our total capital expenditures for fiscal 2024 to be approximately $75 million. This estimate includes costs to open new restaurants and remodel existing locations and excludes anticipated proceeds from tenant improvement allowances. We expect to fund our net capital expenditures with our current cash balance on hand, cash flows from operations and our line of credit. Our future cash requirements will depend on many factors, including the pace of our expansion, conditions in the retail property development market, construction costs, the nature of the specific sites selected for new restaurants, and the nature of the specific leases and associated tenant improvement allowances available, if any, as negotiated with landlords.
Current wording
As of May 5, 2025, we have opened one new restaurant and we currently plan to remodel up to 30 existing locations in fiscal 2025. We currently anticipate our total capital expenditures for fiscal 2025 to be approximately $65 million to $75 million. This estimate includes costs to open new restaurants and remodel existing locations and excludes anticipated proceeds from tenant improvement allowances. We expect to fund our net capital expenditures with our current cash balance on hand, cash flows from operations and our line of credit. Our future cash requirements will depend on many factors, including the pace of our expansion, conditions in the retail property development market, construction costs, the nature of the specific sites selected for new restaurants, and the nature of the specific leases and associated tenant improvement allowances available, if any, as negotiated with landlords.
Previous wording
Inflation has had an impact on our operations, new restaurant construction and corresponding return on invested capital. While we have been able to partially offset inflation and other changes in the costs of key operating inputs by gradually increasing menu prices, coupled with cost savings initiatives, more efficient purchasing practices, productivity improvements and greater economies of scale, there can be no assurance that we will be able to continue to do so in the future. Increases in inflation could have a severe impact on the United States and global economies, which will have an adverse impact on our business, financial condition and results of operations. In addition, macroeconomic conditions that impact consumer discretionary spending for food away from home could make additional menu price increases imprudent. Whether we are able to continue to offset the effects of inflation through menu price increases or cost savings will determine to what extent, if any, inflation affects our restaurant profitability in future periods.
Current wording
Inflation has had an impact on our operations, new restaurant construction and corresponding return on invested capital. While we have been able to partially offset inflation and other changes in the costs of key operating inputs by gradually increasing menu prices, coupled with more efficient purchasing practices, productivity improvements and greater economies of scale, there can be no assurance that we will be able to continue to do so in the future. Increases in inflation, including the effects of any tariff increases on food and other restaurant operating and construction costs, could adversely affect our business, financial condition and results of operations. In addition, increases in inflation could have a severe impact on the United States and global economies, which will have an adverse impact on our business, financial condition and results of operations. Macroeconomic conditions that impact consumer discretionary spending for food away from home could make additional menu price increases imprudent to offset the effects of inflation. Whether we are able to continue to offset the effects of inflation will determine to what extent, if any, inflation affects our restaurant profitability in future periods.
Previous wording
Our business is impacted by weather and other seasonal factors that typically impact other restaurant operations. Holidays (and shifts in the holiday calendar) and severe weather including hurricanes, tornados, thunderstorms, snow and ice storms, prolonged extreme temperatures and similar conditions may impact restaurant sales volumes in some of the markets where we operate. Many of our restaurants are located in or near shopping centers and malls that typically experience seasonal fluctuations in sales. Quarterly results have been and will continue to be significantly impacted by the timing of new restaurant openings and their associated restaurant opening expenses. As a result of these and other factors, our financial results for any given quarter may not be indicative of the results that may be achieved for a full fiscal year.
Current wording
Our business is impacted by weather and other seasonal factors that typically impact other restaurant operations. Holidays (and shifts in the holiday calendar) and severe weather including hurricanes, tornadoes, thunderstorms, snow and ice storms, prolonged extreme temperatures and similar conditions may impact restaurant sales volumes in some of the markets where we operate. Many of our restaurants are located in or near shopping centers and malls that typically experience seasonal fluctuations in sales. Quarterly results have been and will continue to be significantly impacted by the timing of new restaurant openings and their associated restaurant opening expenses. As a result of these and other factors, our financial results for any given quarter may not be indicative of the results that may be achieved for a full fiscal year.
Previous wording
A summary of our other critical accounting policies is included in Management’s Discussion and Analysis of Financial Condition and Results of Operations contained in our Annual Report on Form 10-K for the fiscal year ended January 2, 2024. During the thirty-nine weeks ended October 1, 2024, there were no significant changes in our critical accounting policies.
Current wording
A summary of our other critical accounting policies is included in Management’s Discussion and Analysis of Financial Condition and Results of Operations contained in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024. During the thirteen weeks ended April 1, 2025, there were no significant changes in our critical accounting policies.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
Income Tax Benefit. Our effective income tax rate for the thirty-nine weeks ended October 1, 2024, was a benefit of 15.0% compared to a benefit of 44.9% for the comparable thirty-nine-week period of 2023. The effective tax rate for the thirty-nine weeks ended October 1, 2024 and October 3, 2023, was different than the statutory rate primarily due to FICA tax tip credits.