Sales at the J. Alexander’s polished-casual chain climbed to within 9.9% of year-ago levels during the first three weeks of September, while high-end sister concept Stoney River lifted its same-store sales to 88.2% of pre-COVID levels for the same period, according to parent company J. Alexander’s Holdings.
What the company describes as “sales improvements beyond the levels originally anticipated” have prompted the operator to raise its profit projections for the year. It now expects to hit the breakeven point during the third quarter and to generate a cash flow of $400,000 to $450,000 per week in the last quarter of the year.
Management added that the company had $18.6 million in cash on hand as of Sept. 14, “adequate liquidity” for the remainder of the year.
The results show that the company has come lightyears in its rebound from the start of the pandemic when dining rooms were closed virtually nationwide and consumers were encouraged to stay at home. Same-store sales for the J. Alexander’s brand fell 81% for April, the first full month of the pandemic, and 78.3% for Stoney River. Management said the turning point was August, when dining rooms were reopen and off-premise sales remained strong.
“There will be winners and losers when the pandemic is over and our goal from the very beginning has been to be one of the winners,” Mark Parkey, CEO of J.Alexander’s Holdings, said in a statement. “The consistent improvement in our top line sales since all of our dining rooms were allowed to begin reopening in June, combined with the efficiency of those sales as reflected in improved restaurant operating margins over the past few months, lead me to conclude that we are well-positioned to achieve our goal and to do so sooner than we had originally envisioned.”
In the statement, Parkey noted that all 46 of the company’s restaurants have reopened their dining rooms to the extents permitted under state and local regulations. Their capacities currently average 57% of total indoor seating, he revealed.
Parkey attributed the higher-than-expected sales during September to increased traffic from the most loyal customers of J. Alexander’s and Stoney River.
“Research tells us that approximately 16% of our guests drive approximately 66% of our visits,” he said. “That core group of guests has been the backbone of our recovery to this point, much as they were in the aftermath of the Great Recession of 2008-2009.”
Parkey also cited a spike in carryout sales to $600,000 to $700,000 per week for the last 10 weeks. The company intends to sustain that momentum by brainstorming new family-sized to-go meals for the year-end holidays.
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