Cheesecake Factory Tops by 1 Cent

The Cheesecake Factory Inc. (CAKE - Analyst Report) reported earnings of 39 cents a share in the second quarter of fiscal 2010, which modestly beat the Zacks Consensus Estimate of 38 cents. The company also surpassed the prior-year earnings of 28 cents a share.

On a reported basis, including 7 cents a share of expense related to interest rate collar on its revolving credit facility balance, earnings came in at 32 cents a share. The company reported better-than-expected results for the quarter on the heels of effective cost management.

Cheesecake’s top line showed sluggish growth of 0.02% year over year to $418.9 million. Comparable-store sales increased 1.6% in the quarter. By concept, comparable store sales jumped 1.6% and 0.9% at the Cheesecake Factory and Grand Lux Cafe, respectively.

The current Zacks Consensus Estimate for the third quarter is 34 cents. For fiscal 2010, the Zacks Consensus Estimate is currently pegged at $1.37 per share.

The company repurchased 670,090 shares of its common stock in accordance with its capital allocation strategy during the second quarter of fiscal 2010, and spent approximately $17.4 million. Year-to-date, the company has repurchased 1,157,158 shares of its common stock at a total cost of approximately $30.0 million.

Cheesecake ended the quarter with cash and cash equivalents of $86.3 million compared with $72.7 million in the prior-year quarter. Additionally, following its debt repayment during the second quarter of fiscal 2010, the company’s revolving credit facility balance was $70 million as of the end of the quarter.

Read the full analyst report on CAKE