The Cheesecake Factory Incorporated

After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during that time, simply press the star key followed by the number one on your telephone keypad. If you would like to withdraw your question, press star one a second time. Thank you. And I would now like to turn the conference over to Etienne Marcus, Vice President of Investor Relations and Finance. You may begin.

Good afternoon and welcome to our first quarter fiscal 2025 earnings call. On the call with me 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 fact and are considered forward-looking statements within the meeting 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, during this conference call, we will be presenting results on an adjusted basis. which excludes loss on extinguishment of debt associated with a partial redemption of our convertible senior note, impairment of assets and lease terminations, and acquisition-related expenses. 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. Matt will then review our first quarter financial results and provide commentary on our financial outlook before opening the call up to questions. With that, I'll turn the call over to David Overton.

Thank you, Etienne. We delivered solid top and bottom line results in the first quarter with revenues finishing towards the higher end of our guidance and profitability surpassing expectations. This resulted in a 27% year over year increase in adjusted earnings per share, marking our sixth consecutive quarter of 20% or higher growth. Comparable sales at the Cheesecake Factory restaurants increased 1% for the first quarter, with annualized unit volumes exceeding 12.5 million. These industry-leading volumes underscore the strength and distinct positioning of the Cheesecake Factory as one of the most differentiated concepts in casual dining. a reflection of our unwavering commitment to deliver exceptional service, hospitality, and delicious, memorable experiences for our valued guests. Our experienced operators capitalized on improving manager and staff retention to drive guest satisfaction to new heights while effectively managing all facets of their restaurants. Their efforts led to year-over-year improvement in labor management and food efficiencies resulting in substantially greater restaurant-level profitability. In fact, the Cheesecake Factory four-wall restaurant margins increased to 17.4%, up 140 basis points from the first quarter in 2024. On the development front, we're off to an excellent start with eight restaurant openings in the first quarter, including three North Italians, three Flower Childs, and two FRC restaurants. Subsequent to quarter end, we opened three restaurants, including One Flower Child and two FRC restaurants, and we expect to open as many as five more restaurants in the next two months for a total of eight new openings in the second quarter. This continued development cadence reflects meaningful progress towards our goal of accelerating new unit growth. Looking ahead, we continue to expect to open as many as 25 new restaurants in 2025, and we anticipate two Cheesecake Factory restaurants to open internationally under licensing agreements. Underscoring the strength of our culture and values, we're proud to have been named once again to the Fortune Magazine 100 Best Companies to Work For list for the 12th consecutive year. This recognition highlights our vibrant culture, exceptional training programs, and commitment to our employees, all of which continue to support our ability to attract and retain talent as the employer of choice in the industry. In summary, we delivered another strong quarter, and as we look ahead, we remain steadfast in our commitment to our menu innovation, exceptional operational execution, and maintaining the contemporary design and ambiance of our restaurant. These are hallmarks of our more than four and a half decades of excellence, and we will continue to pave the way for future success. With that, I will now turn the call over to David Gordon to provide an operational update.