BJ's Restaurants, Inc.

recorded. I would now like to turn the conference over to Ronna Shermer, Director of SEC Reporting. Please go ahead, ma'am.

Thank you, Operator. Good afternoon, everyone, and welcome to our fiscal 2025 second quarter investor conference call and webcast. After the market closed today, we released our financial results for our fiscal 2025 second quarter. You can view the full text of our earnings release on our website at www.bjsrestaurants.com. I will begin by reminding you that our comments on the conference call today will contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Investors are cautioned that forward-looking statements are not guaranteed the future performance and that undue reliance should not be placed on such statements. These statements are based on management's current business and market expectations, and our actual results could differ materially from those projections in the forward-looking statements. We undertake no obligation to publicly update or revise any forward-looking statements or to make any other forward-looking statements, whether as a result of new information, future events, or otherwise, unless required to do so by the securities laws. Investors are referred to the full discussion of risks and uncertainties associated with forward-looking statements contained in the company's filings with the Securities and Exchange Commission. We will start the call today with prepared remarks from Lyle Tick, our Chief Executive Officer and President, followed by Brad Richman, our Advisor to the Chief Executive Officer. We also have Daniel Duran, our Senior Vice President of Strategy and Financial Planning and Analysis, on hand for questions, which we will take after our prepared remarks. And with that, I will turn the call over to Lyle Tick. Lyle?

Thank you, Rana. Good afternoon, everyone, and thank you for joining us today. Q2 was another strong quarter for the business with continued top-line growth and improved profitability. Importantly, our progress is successfully balancing our short and long-term strategic initiatives. Underpinning all of our work is an unwavering focus on the guest and team member experience. Specifically, we delivered 2.9% comparable sales growth, driven by 3.3% in traffic growth, which underlines the continued resonance of the brand particularly during our critical celebration season. Restaurant-level cash flow margins of 17% and adjusted EBITDA margins of 11.5% represent year-on-year improvements of 150 and 120 basis points respectively, reinforcing the continued progress we're making building the foundations of sustainable and profitable growth. As I reflect on our progress and where we are in our journey, My first nine months have been about solidifying the foundations of the business and setting the stage as we begin to implement and drive our longer-term strategic initiatives in the back half of 2025 and into 2026. We've clarified our brand positioning and established our four strategic priorities focused on the team member experience, our handcrafted food and beverages, delivering wow hospitality, and keeping BJ's atmosphere fresh. This strategic focus has helped us prioritize the key opportunities that matter most for BJ's. We've built momentum with the compelling value of the Pazuki meal deal and kept our brand relevant in the cultural dialogue with the Pazuki platter, the Snickers Pazuki, Frickles, and more. Most importantly, our gold standard of operational excellence has been the engine behind it all, allowing us to wow more guests than ever during the all-important celebration season in Q2. We're operating more efficiently and effectively across all of our restaurants, setting the foundation for profitable future growth. As I look at the results in drivers, my confidence continues to grow in the resilience of our progress. Looking at the first half of 2025, a few things jump out. First, our traffic growth has been seen throughout the business, regardless of how you slice it. Second, our sales and traffic growth has been very consistent outside of clear macro factors, such as the impact of weather earlier in the year. Third, our margin expansion has been broad-based and driven by operating our restaurants more effectively and efficiently, as reflected in our NPS scores, which continue to be at multi-year highs, while our comped meals are simultaneously down significantly. Finally, our manager and team member retention continues to improve significantly year over year and be ahead of industry norms and ahead of our own 2019 levels. Specifically in Q2, the 2.9% comparable sales growth was driven by strong performance throughout the quarter, including a record-breaking Mother's Day and week where the company broke 82 sales records, followed on by a strong Father's Day. The Pazuki meal deal continues to resonate with guests, providing a great value and accessible everyday splurge opportunity, driving increased traffic, recruiting new guests, and driving frequency with existing ones. The marketing team has done a nice job leveraging the power of the Pazuki, driving traffic and engagement. Our limited-time Snickers Pazuki was a standout success, ranking among our top three selling seasonal Pazukis of all time. It also became a major PR win, generating 5.8 billion earned impressions and strong engagement across social and traditional media. Lastly, our continued focus on in-restaurant large parties, aligned with our social splurge occasion focus, drove a 42% increase in seated reservations compared to Q2 last year. On the margin side, our operations teams have made great progress and are focused on improving what we call the table stakes. which are the foundations of great operations and hospitality. We continue to focus on helping our team members be more effective and efficient to enable better execution and higher guest satisfaction. As I mentioned earlier, we've seen the benefits of these efforts in our growing NPS and reduced comp meals. A few areas of operational progress I would call out for the last quarter. First, we continue to push forward with practical improvements to our POS and KDS systems. removing unneeded force modifiers which reduce overall clicks and minimize the opportunity for errors. These changes are some of the drivers of the double-digit reduction in our comped food and beverage year-over-year and flow directly to cost of sales. Second, we completed the integration of dine time and our event portal, removing the need for managers to manually input reservations into dine time. This has made managing reservations and walk-in parties much easier for hosts and guests alike. Third, we rolled ferry express pay earned wage access, giving our team members access to wages daily if needed. This may seem small, but showcases our team member first mentality, driving significantly improved team member retention. Lastly, the continued outlier management work has brought more focus to the fundamentals and is lifting all ships. I want to thank our teams from the restaurants through to the support center, without whom our results to date would not be possible. The energy, dedication, and commitment they show every day give me great confidence in what is yet to come. Looking ahead, I'm confident in what we have planned for the second half of the year to continue the momentum we have built in the business as we lap strong top-line performance in the fourth quarter of 2024. While July got off to a noisy start for the category with July 4th on Friday, and record travel. Performance has since returned to expectations, much like it did in February, and has performed in line with our initial expectations, reinforcing my confidence in the progress we've been seeing in the business and that we are focused on the right things. We continue to make progress across all four of our strategic priorities, and we'll begin to rule out some of our longer-term strategic initiatives as we move through the second half of 2025. Starting with the team member experience, as we look ahead to the second half, there's really two main areas of focus. First, the continued journey of making it easier and more enjoyable to work at BJ's for our team members. As I mentioned before, this will be an ongoing journey led by listening to our restaurant managers and team members. Over time, this will be supported by our menu work as we focus on our core categories and drive trader quality and consistency of execution. The second pillar here is training. Our team members bring our brand promise to life every day, and ensuring they have the training, tools, and support to do that is a top priority. Our new chief people officer, Jen Jaffe, has been partnering closely with our chief operating officer, Chris Pinczak, and our field training team to refine our hourly training systems and relaunch our manager training program at our GM conference in October. With respect to our menu and handcrafted food and beverage, we continue to make substantial progress. Our menu focus is on our core platforms and brand icons, including pizza, pizookies, craft beverages, and shareables. As part of these efforts, in the fourth quarter, we will roll out a revamp of our iconic pizza platform company-wide. Pizza is part of BJ's DNA, and we believe this is the best version we've ever had, recapturing much of what made BJ's pizza so beloved. The dough is Detroit-style inspired, yet served in a familiar round format, using unbleached flour, no preservatives, and New York water, which has the perfect combination of iron and minerals to make a great dough. It's crispy, it's light, and it honors the original BJ's inspiration. The sauce is bright, made from 100% vine-ripe tomatoes, along with oregano, Italian herbs, garlic, and extra virgin olive oil. The whole milk mozzarella is rich and creamy. This is a foundational upgrade to a core platform and the consumer feedback thus far has been excellent. In addition to the pizza launch, other core platform upgrades include a new tall 22-ounce pour reinforcing our craft beer authority, a new premium shareable brew house sampler for football season that brings together BJ's favorite bar food hits, and the return of our cult favorite monkey bread pizookie. Our third priority is delivering wow hospitality. Our ongoing work on great fundamentals has been the driver of our success to date, and is the foundation that will underpin our efforts going forward. To complement that, we continue to progress our activity with our activity-based labor model test, supported by our AI forecasting model. Our ABLM test is in roughly 22 restaurants, mainly in Texas and California, and continues to outperform control restaurants on labor hours. But more importantly, we've seen significant movement across pace, value, recommend, and hospitality scores. We expect to have the AVLM expanded to 20% of our restaurants in Q4. Our fourth priority, keeping our atmosphere fresh. We've completed 13 remodels so far this year with another 7 to 10 planned for the remainder of the year. Our remodeled restaurants continue to perform as expected with improved performance versus control. Building from the current remodel program and the brand positioning work, we're making good progress on our prototype design to ensure that our atmosphere continues to be the most powerful manifestation of our brand DNA and brand promise. I would expect the evolved design work to be piloted in market through remodels and NROs in 2026. Our capital expenditure in 2025 related to new restaurant openings continues to be driven by the pace of our pipeline development, ensuring that new locations align with our refined criteria. As we look ahead through the second half of the year, We continue to feel confident in our earnings expectations and comparable restaurant sales growth of approximately 2%. Thank you, and now I'm going to turn it over to Brad to provide more details on our second quarter.