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J. Alexander’s Corporation Reports Results for Second Quarter and First Half of 2011 Fiscal Year
NASHVILLE, Tenn.--(BUSINESS WIRE)--August 4, 2011--J. Alexander’s Corporation (NASDAQ: JAX) today reported operating results for the second quarter and first half of fiscal 2011 ended July 3, 2011.
A summary of the second quarter of 2011, compared to the second quarter of 2010, follows:
- Net sales increased 6.1% to $38,564,000 from $36,336,000.
- Average weekly same store sales per restaurant increased by 6.0%.
- Income before income taxes was $47,000 compared to a loss before income taxes of $357,000 in the second quarter of 2010.
- An income tax benefit of $10,000 was recorded in the second quarter of 2011 compared to an income tax benefit of $383,000 in the second quarter of 2010.
- Net income was $57,000 compared to net income of $26,000 in the second quarter of 2010, and the diluted earnings per share were $.01 compared to $.00 per share in the second quarter of 2010.
Commenting on results for the second quarter of fiscal 2011, Lonnie J. Stout II, Chairman, President and CEO, said, “Overall, we achieved solid progress in our operating performance. We are extremely pleased with the continued gains in sales, which represented our seventh consecutive quarter of same store sales growth.”
For the second quarter of 2011, J. Alexander’s Corporation recorded average weekly same store sales per restaurant of $89,900, up from $84,800 in the corresponding quarter a year earlier. The Company’s average weekly sales per restaurant for the second quarter of 2011 were the same as the same store weekly average because same store sales calculations are based on restaurants open for more than 18 months, and no new restaurants have opened since December of 2008.
J. Alexander’s Corporation reported an increase of 1.9% in average weekly guest counts per restaurant from the comparable quarter of 2010. The average guest check, including alcoholic beverage sales for the quarter, rose 4.0% to approximately $26.00 from approximately $25.00 in the previous year’s second quarter. The effect of menu price increases for the quarter just ended was approximately 2.5% compared to the same period a year earlier.
The Company’s increases in same store sales contributed to lower labor and related costs and other restaurant operating expenses as percentages of net sales during the second quarter of the current year compared to the second quarter of 2010. Total labor and related costs decreased from 34.5% of net sales to 33.7% of net sales. Other restaurant operating expenses decreased to 21.9% of net sales from 22.5% of net sales. Depreciation and amortization of restaurant property and equipment also decreased to 3.8% of net sales for the second quarter of 2011 from 4.1% for the second quarter of 2010 because of the increase in same store sales.
Cost of sales increased to 33.2% of net sales for the second quarter of 2011 from 32.4% of net sales in the corresponding quarter of the previous year.
For the second quarter of 2011, J. Alexander’s Corporation’s restaurant operating margins (net sales minus total restaurant operating expenses divided by net sales) increased to 7.4% from 6.6% in the same period of 2010.
“Our cost of sales continues to be a major concern for us,” Stout said. “We experienced increases in almost all food cost categories during the recent quarter with seafood, dairy and produce prices remaining notably higher than a year ago. Produce costs have declined somewhat from the first quarter of 2011 but beef costs remain relatively high and our overall cost of sales is still higher than our targeted level.”
Stout said that J. Alexander’s Corporation instituted a modest increase in menu prices during the second quarter which offset a portion of the increases in input costs. “The increases included the effect of reformatting our menus to include separate lunch and dinner menus and raising prices slightly in some restaurants at dinner as compared to lunch.”
For the first six months of 2011, J. Alexander's Corporation recorded net sales of $79,313,000, up from $75,061,000 reported in the first two quarters of 2010. The Company recorded net income of $1,119,000, or $.18 per diluted share, compared to a net income of $823,000, or $.14 per diluted share, posted in the comparable two periods of 2010.
J. Alexander's Corporation’s average weekly same store sales per restaurant were $92,600 in the first six months of 2011, up 5.8% from $87,500 recorded in the first two quarters of 2010.
The Company’s average guest counts for the first six months of 2011 increased 1.3% from the comparable six months of 2010. The average guest check, including alcoholic beverage sales, increased 4.3% to $26.20. The effect of menu price increases for the first two quarters of 2011 was approximately 2.5% compared to the same period of the prior year.
Cost of sales for the first six months of 2011 was 33.1%, up from 31.9% in the comparable six month period of 2010. Restaurant labor and related costs for the first two quarters of the current year decreased to 33.0% of net sales from 33.8% of net sales in the same two periods of 2010, and other restaurant operating expenses decreased to 21.2% of net sales for the first half of 2011 compared to 22.1% for the first half of 2010. For the first six months of 2011, J. Alexander's Corporation had restaurant operating margins of 8.9%, up from 8.1% in the first two quarters of 2010.
The following information was filed by Alexanders J Corp on Thursday, August 4, 2011 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-Q Quarterly Report statement of earnings and operation as management may choose to highlight particular information in the press release.
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