Investing.com -- Shares in The Cheesecake Factory (O:CAKE) tumbled more than 5% in after-hours trading after the upscale restaurant chain posted worse than expected revenues on Monday for its third quarter of fiscal year 2015.
For the company's third quarter, which ended in late-September, The Cheesecake Factory finished with revenues of $526.7 million, up from sales of $499.1 million in the same period of 2014. Still, the revenues fell short of analysts' forecasts for revenues of $535 million for the three-month quarter. In terms of earnings, The Cheesecake Factory reported net profits of $26.2 million or 0.52 per share, up from $24.2 million or 0.48 per share over the same quarter in 2014.
The company blamed a pre-tax, non-cash charge of $6 million related to impairment from its RockSugar Pan Asian Kitchen restaurant for creating a substantial dent in earnings. Without the impairment, The Cheesecake Factory said it would have reported net income of $29.8 million and diluted net income per share of 0.59 for the quarter.
In spite of the subdued revenues, The Cheesecake Factory CEO David Overton was pleased that his company reported a 2.2% increase in comparable restaurant sales during the period.
“The consistency of our results continues to be evident as we delivered our 23rd consecutive quarter of positive comparable sales. We successfully lapped our most difficult sales comparison of the year and continued to exceed the performance of the casual dining industry overall during this past quarter,” Overton said in a statement.
“We experienced similar cost dynamics to the second quarter, with favorability in costs that affected our results last year helping to offset some of the wage inflation that many restaurants and retailers are experiencing. Our solid sales growth combined with healthy four-wall and total operating margin expansion drove earnings per share growth in excess of 20 percent."
The company's Board of Directors also authorized a quarterly dividend of 0.20 per share on Monday payable on November 23.
"As we look ahead to 2016, we remain focused on the long-term drivers of our business – innovation, hospitality and operational excellence – and are firmly committed to utilizing our capital to produce the highest returns and maximize total shareholder return,” Overton added.
Shares in The Cheesecake Factory plunged 2.97 or 5.71% to 49.02 in after-hours.