The Cheesecake Factory Inc. will not likely roll out touch-screen tablets at its restaurant tables anytime soon, the company said Wednesday.

After reporting a 49-percent increase in fourth-quarter earnings, despite taking a sales hit from bad winter weather in December, Wall Street analysts asked the Calabasas Hills, Calif.-based chain if it planned to follow in the footsteps of casual-dining competitors such as Chili’s and Applebee’s, both of which this year are starting to roll out tabletop tablets that let customers order and pay with the swipe of a card.


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“I doubt very much that we’re going to do tablets,” Cheesecake Factory chairman and chief executive David Overton.

“I think it’s great for Chili’s in that level, where people are coming in for one experience,” he continued. “But for us, they’re coming in for a very different experience. And I think they want to be waited on and served.”

Cheesecake Factory president David Overton said the company is going to “be very careful when it comes to technology.”

“The core of our business is wonderful hospitality and delicious, memorable food,” Gordon said. “And our strategy is to improve those two areas continually, as we have every year for 35 years.”

Gordon said he was open to technology that can add to the guest experience, which, at The Cheesecake Factory, is more likely to include simple things like text paging, which could replace the use of pagers that alert customers when their table is ready.

“But right now we don’t have a roadmap that talks specifically about adding technology for the sake of adding technology,” he said.

Winter weather impacts results

(Continued from page 1)

Bad winter weather dampened sales during the Dec. 31-ended fourth quarter, with systemwide same-store sales increasing a modest 0.9 percent. Same-store sales rose 1.1 percent at The Cheesecake Factory and fell 1.1 percent at the Grand Lux Cafe chain.

Overall, traffic declined about 1 percent, offsetting a 2-percent menu price increase.

Cheesecake Factory executive vice president and chief financial officer Douglas Benn said weather disruptions cost the company roughly 70 basis points in sales, or about 2 cents per share in earnings.

Excluding the weather’s impact, the company estimated that same-store sales would have risen 1.6 percent for the quarter.

October and November showed some of the strongest monthly sales trends for the entire year, and even traffic lifted at the end of November, said Benn, until December’s polar vortex hit.

Still, Overton noted that the company completed its fourth straight year of positive quarterly comparable-store sales “at full margins, without discounting.”

The Cheesecake Factory has outperformed the casual-dining industry as a whole nearly every quarter during that period, including the most recent fourth quarter, he said.

While companies like Starbucks have indicated that brick-and-mortar retailers are suffering from a consumer shift to online shopping, Benn said that doesn’t appear to be a factor for The Cheesecake Factory’s mostly mall-based locations. 

“I think that a lot of people go window-shopping and they go out to eat, and they want to get out, and it’s an enjoyable evening,” he said. “Many of them will go back and order off the Internet. So although sales might be down (at malls), many times there are a lot of people and they’re really there to enjoy themselves, eat and window shop.”

For the first quarter of fiscal 2014, the company projected a same-store sales increase of flat to increasing 1 percent, as winter storms continued into 2014. For the year, same-store sales are expected to rise between 1 percent and 2 percent.

The company expects commodity inflation to be more benign than anticipated, rising 3 percent to 4 percent, rather than the previous estimate of increasing 4 percent to 5 percent, though shrimp and salmon prices remains high. As a result, the company expects to keep its annual menu price increase to about 2 percent in 2014, at the low end of its typical range.

The chain plans to open 10 to 12 new restaurants this year, including one relocation, an increase from the nine locations added in 2013. In addition, three to five licensed units are expected to open in the Middle East and Mexico.

The Cheesecake Factory Inc. ended the year with 169 namesake restaurants, 11 Grand Lux Cafe locations and one RockSugar Pan Asian Kitchen unit in the U.S., and four licensed international locations.

This story has been revised to reflect the following correction:

Correction: Feb. 14, 2014 An earlier version of this story incorrectly attributed quotes by David Overton and David Gordon as a result of a transcript error. The story has been updated to reflect the speakers and their quotes accurately.

Contact Lisa Jennings at lisa.jennings@penton.com.
Follow her on Twitter: @livetodineout