BJ's Restaurants (BJRI) Q3 2024 earnings summary

Executive summary

• Q3 2024 revenues increased 2.2% year-over-year to $325.7 million, with comparable restaurant sales up 1.7% and guest traffic up 1.3%, outperforming the industry by 5.7 percentage points.

• Net loss for the quarter was $2.9 million, an improvement from $3.8 million last year; diluted net loss per share was $0.13.

• Value-driven promotions, especially the Pizookie Meal Deal, and new restaurant openings contributed to strong weekday traffic and share gains.

• Leadership is focused on brand discovery, operational simplification, and disciplined capital allocation, with new executive appointments and a comprehensive business assessment underway.

• As of November 4, 2024, 218 restaurants were operated in 31 states.

Financial highlights

• Restaurant-level cash flow margin was 11.7%, down 20 basis points year-over-year due to higher costs and promotional activity; restaurant level operating margin was $37.99 million.

• Adjusted EBITDA was $18.5 million (5.7% of sales), down from $19.6 million last year, mainly due to higher G&A.

• Cost of sales was 26.6%, up 70 basis points, impacted by promotions and food cost inflation (~3%).

• Labor and benefits were 37.1% of sales, flat year-over-year; occupancy and operating expenses improved by 40 basis points.

• Operating cash flow for the nine months was $69.8 million, down from $73.6 million year-over-year, mainly due to timing of receivables and payables.

Outlook and guidance

• Q4 restaurant-level margins expected in the mid to high 14% range, reflecting improved sales trends and cost controls.

• Management expects favorable profit momentum in Q4, focusing on restoring higher restaurant-level margins and disciplined financial approach.

• G&A projected at $21 million for Q4, consistent with recent run rates.

• Comparable restaurant sales for the first four weeks of Q4 are up more than 4%.

• Capital expenditures for fiscal 2024 are anticipated to be approximately $75 million, focused on new openings and remodels.