The Cheesecake Factory Incorporated

Good day and thank you for standing by. Welcome to the Cheesecake Factory first quarter fiscal 2021 earnings conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1 on your telephone. If you require any further assistance, please press star 0. Please be advised that today's conference is being recorded. I would now like to have the conference over to your speaker today, Ms. Daisy Fife, Vice President of Investor Relations. Please go ahead.

Thanks, May. Good afternoon and welcome to our first quarter fiscal 2021 earnings call. On the call today are David Overton, our Chairman and Chief Executive Officer, David Gordon, our President, and Matt Clark, our Executive Vice President and Chief Financial Officer. Before we begin, let me quickly remind you that during this call, items will be discussed that are not based on historical facts and are considered forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual results could be materially different from those stated or implied in forward-looking statements as a result of the factors detailed in today's press release, which is available on our website at investors.thecheesecakefactory.com and in our filings with the Securities and Exchange Commission. All forward-looking statements made on this call speak only as of today's date and the company undertakes no duty to update any forward-looking statements. In addition, throughout this conference call, we will be presenting results on an adjusted basis which reflects the potential impact of the conversion of the company's convertible preferred stock into common stocks. An explanation of our use of non-GAAP financial measures and reconciliations to the most directly comparable GAAP measures appear in our press release on our website as previously described. David Overton will begin today's call with some opening remarks and David Gordon will provide an operational update. That will then briefly review our first quarter results and provide a financial update. With that, I'll turn the call over to David Overton.

Thank you, Stacey. Following an uncertain start to the year, given the impact of dining room closures and capacity restrictions, March served as a positive inflection point in our sales trend as restrictions eased and consumer spending generally increased. By mid-March, nearly all Cheesecake Factory restaurants, as well as our other concepts, had some level of indoor dining capacity opened. We saw significant pent-up demand across the country and also saw some benefit from the earlier spring break vacation timing. At the same time, we continued to drive strong off-premise sales volumes, which equated to over $4 million on average per unit on an annualized basis at the Cheesecake Factory restaurant, based on average weekly off-premise sales during the first quarter. Our operators did a tremendous job managing the dine-in and off-premise sales levels, delivering delicious, memorable experiences for our guests and also exceeding our expectations across our key performance indicators. This drove a strong end to the first quarter and a solid start to the second. On the development front, during the first quarter, the Cheesecake Factory opened in Washington, D.C., just down the street from the White House. The local response has been incredible, opening week sales exceeding 230,000, and that was just 25% indoor dining capacity. During the first quarter, North Italia opened in Birmingham, Alabama. A new market and a second North Italia location in Miami area opened subsequent to quarter end. The response from guests, media, and local influencers in both markets was extremely positive. as the concept continues its national expansion. One of the FRC incubation concepts, Blanco, opened its first location in the South, in Nashville, to an hour wait. The restaurant has fantastic real estate at the new 5th and Broadway development, and the Mexican-inspired menu has proven very distinct in that market. This is the top performer among the Blanco restaurants in its first seven weeks of operations. Turning to international, the first downtown Shanghai Cheesecake Factory location opened under a licensing agreement earlier this month. This restaurant had a tremendous opening with nearly $225,000 in sales the first week. We believe this restaurant's performance will be a good indicator for the Cheesecake Factory's continued potential in mainland China. We are now on track to open as many as 14 new restaurants across our concepts this year as we have more visibility on our pipeline of sites, including the timing of one new Cheesecake Factory location that shifted to 2022. And internationally, we continue to expect as many as three Cheesecake Factory locations to open under licensing agreements, including the recent Shanghai opening. Before I turn the call over to David Gordon, I'm proud to share that the Cheesecake Factory has been named one of Fortune Magazine's 100 Best Companies to Work For for the eighth consecutive year. And again, we are the only restaurant company on the list. This accolade is even more meaningful in the context of the challenges we face during 2020 and the unique labor environment the restaurant industry is currently experiencing. Our team's dedication to the guests and each other is what has always made us a great place to work and this has been even more true during the past year. This recognition would not have been possible without all the amazing people and the incredible culture we have built together. We believe we have one of the best teams in the industry which we expect to continue to differentiate us in the COVID operating environment and as we emerge from the pandemic. With that, I'll turn the call over to David Gordon.