J. Alexanders (JAX) 6 May 182018 Q1 Earnings call transcript

Good morning, ladies and gentlemen, and thank you for standing by. Welcome to the J. Alexander's Holdings, Inc., First Quarter 2018 Earnings Conference Call. Today's conference call is being recorded. At this time, all participants are in a listen-only mode.

will question-and-answer we presentation, the conduct session. a Following my introduce your Instructions] It Mr. to now is [Operator host, pleasure Tom Lawrence for introduction of our speakers. Mr. Please ahead, go Lawrence.

Thank www.investor.jalexandersholdings.com, everyone discuss your this appreciate the the first Alexander's you, distributed a joining XXXX. for J. received you Michelle. on By that was a of us she of yesterday you now at copy, Alexander's Holdings, is release interest anyone and need Inc. conference afternoon. have of results Katherine in news to does a quarter call on the it available website should XXX-XXX-XXXX, Berendt or can J. If call We copy copy at immediately. send will

and forward-looking that J. remind conference CEO Inc., I turn during statements release to all Holdings Litigation of Lonnie provisions statements I Before expectations call President historical These are over Alexander's reasonable you the in of statements. other are than this to Act and based of pursuant Reform the the fact made of call, believes XXXX. news II, The on made J. that Stout statements company Harbor its are Private Safe assumptions. the Securities

other statements. and these achievements actual statements results, by or important forward-looking uncertainties Company's of to the the expectations implied industry However, these achievements or forward-looking factors future differ performance cause unknown results results, risks, could involve or known that expressed or and Company's performance materially from

ended website XXXX, the XX-K, company's Additional other Company's which of in Form find the press release and and you of other Investor section with SEC's Report, for and Factors the the the XX, information is yesterday's Annual concerning Relations in risks, filed Statements headings, those uncertainties and on website. SEC, the Forward-Looking under the factors can December Risk year described sections

available dated information summary For non-GAAP XXXX. and GAAP May press accompanying the release this financial are disclosed call, in statistical related the X, in other the measures measures and

do operations future not of results past Company's the results. its necessarily addition, In indicate

the over we made diminish statements should that call people to XXXX. of the or by the J. the of Holdings the may opening remarks. quality call transmission are Also, the passage It's the understand are to of consent the of Company, the to be wanted Inc. replay contents for as date Stout to and statements. X, property the only the let the will pleasure that of information time his Lonnie the the now Finally, of any listening May itself know of the Those of call with replay made during turn my done call Alexander's call,

Thank our you, to he pleased both with of to our have call everybody after me, will Tom. on Chief Parkey for overall another positive solid groups. sales Company the Financial report restaurant We performance welcome I Mark by highlighted be yesterday the I today. my remarks. Officer, and same-store were want in

of the same-store from X.X% Our which Alexander's X.X% XXXX. sales the first to of but the results comparable a ahead average soft, same-store somewhat week, and of reported were quarter grills sales per $XXX,XXX of weekly at came restaurants at acceptable in performance in has compared increase quarter, our strong Stoney had of group, average weekly of same-store We an sales XXXX. or River quarter generated the for J. $XX,XXX average

experienced of some There our effect as Alexander's/Grills and Stoney restaurants. XX most weather adverse a guest on achieved in results during on adverse several harsh days consolidated basis, despite our were closings a traffic of As quarter. quarter, days were we River restaurant markets with impact Midwestern numerous unusual months hash we January extreme harsh in and other weather the approximately we on had more the the southern severe weather first markets. didn't had the three quarter conditions top-line the the these close, then but On conditions had all conditions noted February. it did J. negative yesterday, restaurants weather our winter first weather for occurring in The our during We of - where the our weather in inclement persisted. impact

we're guest past As and a the days a counts X% is down That guest the same-store down, weather. of months comparison, to of collections total during attributable our And the basis Guest to first closings are X.X% a we severe been quarter. concerned basis, little had during estimate a quarter sales consulate were winter having said, be in the of winter for when the and a counts down over XXXX. XXXX. Alexander's/Grill glad in always we half on decline we're counts on three of J. same-store

cautiously that our continue are guest We of count to normalize will the remainder the during optimistic trends year.

Holdings For the quarter $XX,XXX,XXX, net XXXX. of to XXXX, X.X% increased first sales J. of $XX,XXX,XXX of in the Alexander's first quarter from up

I modest, with the XXXX. as per for quarter $XXX,XXX sales weather impact $XXX,XXX Though same-store expect as per XXXX the noted. of from sales for from our most average restaurant the restaurant in exception the quarter said, first X.X% first advanced For of in Overall, progresses. first to XXXX in the of to Alexander's/Grill the $XXX,XXX growth J. for quarter. X.X% this was in was the our quarter improvement, increased the Alexander's/Grill group $XXX,XXX we weekly as Average weekly restaurants, previously year all the J. recent of first in performance quarter locations sales expected the

results pleased are restaurants our mature. they balance We on of continue to newer with as

from for of our Stoney continue recent restaurant to are weekly most River first quarter recent first quarter, for quarter exceeded with the in in results making encouraged of XXXX. the X.X% the Stoney The all with at same-store quarter. our sales same-store progress of to XXXX per the passing per rose $XX,XXX Grill the Average quarter most first weekly of to locations XXXX. restaurants, For and the restaurant quarter locations in sales $XX,XXX $XX,XXX River River Steakhouse the expectations improved average X.X% XXXX we $XX,XXX be each in Stoney and from sales

River progress seeing and continue we within where markets particularly offerings. we're the As determined our and we as brunch In lunch with expand yesterday's encouraged we noted Stoney restaurant to have in lunch can brunch. release, group, the we support we're

lower-priced menus and offerings, by drive design brunch lunch typically guest Our include which down average check.

our location. more day base our our However, is least foundational week. to development guests restaurants the each J. is visit of this become market we that lunch, now tended of locations suburb we week, King part announced operating this which likely firmly excited has successful have our earlier Prussia, We're a expecting program, guests serving we that newest evaluated believe of we're all our a to In about often years. while offer community in locations worked well, it in been this Six the opening will same. the Alexander's nine restaurants Stoney historically Philadelphia. Most established. on do our one and restaurants, several in It the River are of the more very for at of restaurant upon of brunch these do

be Steakhouse Stoney and communicated, our Michigan. Troy, in will next As River Grill previously

quarter respect forward looking to the of prices did last in X.X% opening to to quarter were enthusiastically With the quarter expect are favorable, restaurant XXXX. a down XXXX, the quarter of fourth and X.X% We first the performance and XXXX. the first ended. group during Stoney of we at extremely year, of at these compared the just and down first cost favorable River Alexander's [Indiscernible] pricing repeat this of sales, J. not the Grills,

compared at to the of up River were costs and X% J. X.X% opening beef the up quarter Stoney at While Grill Alexander's/Grill and XXXX. restaurants restaurants, Steakhouse

results input cost a range expectations in the of for of first was well that to the for of sales our as shareholder we professional we of transaction related XX thereafter. considered XXXX. February acquisition. XXXX to Our XXXX. related first percent of net the transaction quarter the our originally for quarter recent Also sales number quarter compared proposed were X, terminated within Total August in posted were of quarter impacting first XX.X%. expenses agreement This to the receive the primarily of to - announced The was quarter that the not did XXXX. were most same cost to of of beef be $XXX,XXX normal of XX.X% in merger acquisition the XXXX. during votes required And disinterested Restaurant proposed XXXX, approve On concept of our $XXX,XXX we incurred fees the announced expenses

before Black of Mark $X,XXX,XXX, first Advisory Knight profit will interest which impacting significant than for the Another $X,XXX,XXX XXXX. in in Services was higher few a continuing discuss to grant million quarter of the continuing valuation XXXX taxes was results income his taxes profit from LLC quarter grant, of was of of approximately the first income a our in expense interest operations item $X.X of during anticipated. interest income first $X,XXX,XXX profit of from operations moments. resulting in details compared XXXX before Income quarter comments the the

lesser were the the profit the of including Services recent the Black and the impact accounting impact transaction there expenses, of in of breakage. mentioned, impacting the XXXX, Advisory of of factors several degree, for restaurant As of results the requirements, quarter affects primary new new interest And with valuation most increase the which Knight recognition to timing openings. the discard associated a pre-opening expenses

comparable include XXXX provision tax of in have income $X,XXX,XXX of income $X,XXX,XXX, $XXX,XXX in recorded the of quarter income as from totaled impact income would as net corresponding $XXX,XXX before much from XXXX. down in to posted of amounted the of to Results Excluding of an the XXXX first provision year-ago. items, quarter an first of a quarter income income these first the in tax continuing quarter Net the of XXXX. compared operations for we approximately quarter taxes the

Our over given summary, for good the the year. improvement to it $X,XXX,XXX performance planet's basic our particularly with the the EBITDA first to of quarter on Adjusted recent reported line February. quarter January call the of XXXX. $X.XX weather was second quarter. and will $XXX,XXX quarter, a turn the Parkey, I $X,XXX,XXX, back compared $X.XX first and the balance Chief our most I Mark and the throughout some first diluted XXXX comments XXXX was quarter We of impact moments. in our Financial Officer. sales believe in for prior the or share totaled closing the X.X% when in of was quarter negative of the on few with quarter for of from expectations In an the Mark? of now earnings much first come in a per

you, morning, and Thank everyone. Lonnie, good

first interest April in profits which the highlighted first the of significant earnings only estimated in overall the impact performed $XX.XX for adjusted a discussed us of topline, upon The valuation X, taxes our LLC at expense three-year from relatively valuation. most during price period for tax of XXXX, interest the based is grant recorded. valuation quarter requires operationally short Lonnie an Tax end to grant we performance. coupled runs We've which ended the the most be was quarter, of income Black The our to the issues $X,XXX,XXX XX, Act in per valuation with Black-Scholes a period, interest quarterly X, first $XXX,XXX the and with $XXX,XXX There The effective yesterday. XXXX recent X, income $X,XXX,XXX factors to quarter quarter of the that in grant those calculated recent mentioned an the was the fees most quarterly consulting in XXXX. expense quarter profits in interest model valuation under surprises of operations first Cuts closing Black in quarter. with in associated being to Year. recent effective reflect XXXX. October impacting non-cash the we primarily a compared this the the the compared amortized, or again results through the consulting or It associated profits for Services recent was last greater when quarter with using valuation with incurred of to no showed the share also with This the resulted guidance accumulative additional each the of were increase primary generally change previous the issued Advisory over the compared the or XXXX. Among to most a release this before Due quarter favorable Knight of ended fees agreement pleased most of This $XX,XXX the is October April at The information impacting and XXXX expense of Company's stock first factors affecting Black Company's Black recent Knight the previous the quarter. detail recognized continuing were rate income New vesting income December of or quarter Knight and XXXX, remaining of few Company the also Knight grant, of of covered of Jobs the portion call. during profits our included and management previous XXXX.

For base net expenses food of over costs $X,XXX,XXX related costs for quarter first menu our first labor the which sales XXXX, Stoney the inflation guest first of the effective the Alexander's/Grill and grew guest Stoney average restaurant and same Grill increase the Stoney J. to and and estimated Stoney XXXX in $XX.XX X.X% at restaurants of in of XXXX the and an for for year-ago. first for Alexander's/Grills of first quarter first guest a the River was the sales first to X.X% quarter guest of restaurants, XXXX With first The as a in quarter alcohol by beverage quarter quarter to total XXXX. Company's XXXX $XX.XX Steakhouse the was sales of of XX.X% compared to of the base their reported the sales, income the corresponding be in X.X% quarter of of in in check net the to the XX.X% average respect of percentage within first counts quarter the check restaurants XXXX, J. restaurants J. XXXX. guest to the quarter increased include XXXX. XX.X% our of the pricing income same-store average within Inflation were quarter Alexander's/Grill corresponding of Same-store compared operating sales while XXXX operating restaurants of of The base same-store quarter during same-store restaurants XXXX. $X,XXX,XXX compared decreased XXXX X.X% net within recorded of XXXX, to XXXX net of checks, the from of J. corresponding of to XX% Other operating at estimated quarter for $XX.XX during first for the a of X.X% $XX.XX X.X% over were the for in was XXXX. total X.X% first was restaurants. quarter increase decreased during the restaurants, quarter from River of The first estimated restaurants. XXXX compared the And of X.X%. increase quarter first an Alexander's/Grill the of River River quarter to of quarter counts

the was XXXX sales XXXX rate. and this The Company's administrative prices the as of a an of first restaurant to of of except Steakhouse of our previously and related tax quarter modestly XXXX Grill in Lonnie outlook general Most quarter XX.X% operating X.X% increase estimated of income sales percent sales is in first XXXX XXXX. River As Black interest the for quarter of XX.X% of both the first both profit XXXX, The of margin XXXX. Company's as discussed. for the Stoney as unchanged of net the effective Knight beef grant fiscal remains to valuation of the first the quarter quarter were and well than Consolidated pointed out, quarter the net compared for the higher increase Alexander's/Grills net first of J. increase in concepts corresponding during expenses $X,XXX,XXX. were performance at

operator full which the this participant to to will business The portion XX% the the to quarterly Company X, XXXX, from morning's tax before not is for guidance on original to does a will the for this back reason. May X%, the any with the rate its thereof however outlook anticipate range our or subject to our Company XX% release, any call. call and at to is X% effective guidance. issued turn open change, the update now based time the earnings outlook expect decrease calling next As we may from update segment any of range information I

Our Please with comes you. your Thank Instructions] Will with proceed line [Operator question. from of Slabaugh Inc. Stephens the first question

I It as you guys. the from your can agreement of first. like revaluation how was question adjusted to to want it was just Mark, Knight the EBITDA $X.X morning, confirm Good was accounting looks million how added number? number treated back an that, well charge of to in Black EPS as that it ask treated? $X.XX. I verify not the wanted

not is is earnings calculation. The Yes. associated adjusted the But interest per from an non-cash EBITDA back with for grant expense it excluded - profits will that impact. share added

an earnings any like just calculation share expense. it's per So other in expense the

Got that. you're If thinking EPS I you've about getting add something I I'm back as how it were your and like for that relates that was it, and wondering also to on to year? the $X.XX that from guidance given

of there's at of quarter Obviously, was moving Well, parts a the valuation the at higher than first XXXX year-end. in the couple of that. end

that's as disclosed. our But is increase our the other tax rate to lower, So way. help going line will bottom which our we've expense effective

So two originally year the net with effect ends our for remaining of the still we those appropriate as guidance issued. adjustments up

system? And want strong, very traffic about how which that. can to you commentary there Thank is around ask would your be Stoneys, continues as well? you units talk Okay. And to that steady be newer then at across about the helpful any for I

River, the and in sort up still them. increase traffic sales an we restaurant Will. It's the done one restaurants, the only bag mixed that Hill a restaurants. We've dinner. Traffic point reasons, Stoney the for restaurant of of activity, has Germantown, across posting Traffic's is both our all highest dinner on and increases. and open that's of at of sales Stoney program and system, good we rest general got a view. the well it lunch The the in Lonnie. just still River Stoney only, is the a restaurant of dinner designed from same-store in we in have most Chapel in It's Sure, This River. lagger is that's strong some brunch lunch for opened sales. originally, us The volume it's and

Of volume generates same course, and it the dinner. it doesn't lunch in generate

we to put our think dinner started location. a going we it. be will have on will that just lunch getting Troy, in market, decided said that We of location, the one the not in Stoney It's and great location. And profitable. And but all as lunch working be be year, will last dinner forward lunch lunch Michigan, Stoney River of we're on and a lunch

have solid out, performance, traditional So successful and - locations and than the are it program in locations brunch building Stoney, one that laggard brunch sales constantly and across successes in sales summary, we in we park, dinner sales that's at do rolled restaurants. other but group, the day lunch so. that same-store on the all that the so Like increases have extremely

And level like then, imagine seems wanted your And deep XXXX stores you that talk outlined? so you're at just verify hear. that. fairly also confidence getting feel It to getting I you've lastly, of you about XXXX in can into their point. in open this to confident Great pretty there,

update you hoping was well? give us as I So there could an

confident Yes, the we're keeping opened, it fourth open. and we are that Stoney the highly pressure quarter, scheduled River the will for

development plan. complete will XXXX the that So

of the to said I throws three final several leases still locations. We're that. XXXX, negotiating on we For in four, in we're think confident

we you're You the a put in successful, in and do for queue to Example, be restaurant market. have Naples we're to than to the things to more development trying have do. going

Stoney due have still looking market, We our working is and we the and trying We're evaluating our on. a traditional sites have diligence markets. best. Nevada but in three one determine there. of River doing we're at two Henderson, to opportunities the We're negotiating in which sort We're

lot For Antonio, have Dallas Texas, and of Houston. for a San instance, we activity,

and We'll about development. be will call, probably on specifics So second the we're some quarter site we development very our objectives, able confident. talk to hit

Great. and Thanks guys congrats.

Thank Appreciate it. you, Will.

any call the There closing like Lonnie questions Instructions] further over to turn time. no this to I'd back are Mr. [Operator remarks. Stout at for

you, Thank Michelle.

We historical release XXXX gains other during ongoing also the weather XXXX. forward J. yesterday, levels reported collection at of measurements The our our marked we our balance our issued most is As year. winter Alexander's/Grill's remaining continued first of River of collection that for quarter which in key the in met We're behind and of three press by same-store in move sales continued restaurant anticipate reflect to will and that the Steakhouse line us. was results, to the Stoney the the looking improvement more top areas. at quarters Grill

we're nine earlier, mentioned the lunch six serving serving Stoney I We're restaurants. As now at locations. brunch of at River River Stoney

in year, the are We concept anticipate loyalty Stoney communicating you. call as traffics the to positive sales look these you River continues momentum realizing trends We We year this us everyone's at the We progresses. forward momentum. as interest again guest within to and throughout gain Thank on with guest in continued locations. appreciate joining the morning.

Thank teleconference. you. This concludes today's

time. Thank your have and wonderful a participation, may this day. at You lines you for disconnect your