California Pizza Kitchen Inc. reported financial results for the fourth quarter and fiscal year 2010 ending Jan. 2, 2011.
Fourth quarter results
The 13-week fourth quarter revenues decreased 5.9 percent to $157.9 million, whereas the prior year 4Q resulted in a 3.2 percent revenue increase. Additionally, full-service comparable restaurant sales were down 1.1 percent, including an estimated 1.4 percent negative impact from inclement weather and the holiday shift.
Average weekly sales for the company's 200 full-service restaurants were $57,687 in the fourth quarter of 2010 compared to $57,949 in the same quarter last year.
During the fourth quarter of 2010, CPK opened full-service restaurants in Bridgewater, N.J.; Pittsburgh, Pa.; Tucson, Ariz.; and Shanghai, China. International franchise partners opened a full-service restaurant in Mexico City, Mexico, the company's ninth location in the country, and a third full-service restaurant in Dubai, U.A.E.
2010 year-end results
The company's net income for 2010 was $0.4 million or $0.02 per diluted share. Total revenues on the year decreased 3.4 percent to $642.2 million, and total revenues decreased 1.2 percent excluding an additional week in the fourth quarter of 2009.
The full-service comparable restaurant sales for 2010 were down 2.4 percent. Still, with these numbers, the company exceeded expectations.
"We were pleased to deliver fourth quarter earnings that exceeded our previous guidance and that our comparable restaurant sales, absent the inclement weather and holiday shift, were positive. Strong labor management also helped us achieve lower costs as a percentage of restaurant sales," said Rick Rosenfield and Larry Flax, co-CEOs of CPK.
Looking to 2011
CPK is focused on enhancing the brand in 2011, including a menu evolution to drive traffic and further differentiate itself from casual dining competitors.
"As part of that effort, we are also targeting margin improvement by streamlining our menu and implementing a series of productivity initiatives. Our overriding goal in managing our strong, debt-free balance sheet is to increase our return on assets, bolster cash flow and maximize system-wide performance. We believe this will lead to long-term and sustainable growth in shareholder value," Rosenfield and Flax said.
The company also outlined financial guidance for the first quarter of 2011 based on the following estimates and assumptions:
- Full-service comparable restaurant sales between negative 1.0 percent and negative 2.0 percent (includes the effects of 172 weather related/store closure days in January 2011 versus only 64 such days in January 2010).
- Opening one company-owned full-service restaurant.
- Opening two international franchised restaurants.
- Earnings in the range of $0.03 to $0.05 per diluted share.