BJ's Restaurants, Inc. (BJRI) Earnings Call Transcript & Summary

Hello, and welcome to the Annual Meeting of Shareholders of BJ's Restaurants, Inc. Please note that today's meeting is being recorded. [Operator Instructions] It is now my pleasure to turn today's meeting over to Jerry Deitchle, Chairman of the Board of BJ's Restaurants, Inc. Mr. Deitchle, the floor is yours.

Well, thank you, operator. Good morning, everybody. I'm Jerry Deitchle, Chairman and retired President and CEO of BJ's, and thanks for attending our second, and hopefully, our final virtual annual shareholders' meeting. I know that our Board of Directors and management team always welcomes the opportunity to meet with our shareholders in person, so hopefully, next year, we can resume our normal in-person annual shareholders meeting. Before we begin the formal agenda today for our meeting, I'd like to briefly share a couple of observations with you since we last met this past September. I've been involved with BJ's for almost 17 years now, and I've been a professional in the restaurant industry for well over 40 years. So one might think that after 40-plus years in our industry, one has seen it all. Economic cycles come and go, labor and commodity cost cycles come and go, real estate cycles come and go and so forth. But clearly, the COVID pandemic is something that few, if any of us, in the restaurant business and for that matter, in the entire world, ever contemplated that would occur on a worldwide scale to this extreme. As we all know, the U.S. restaurant industry was severely impacted by the pandemic. Interestingly, limited service restaurants fared much better than full-service restaurants like BJ's. I read some recent industry publications that indicated that approximately 80,000 restaurants, roughly 10% of all restaurants, opened before the pandemic have permanently closed. There were approximately 34 large restaurant chains or large-scale restaurant franchisees that filed for bankruptcy protection since the pandemic began. At least 2 million restaurant jobs were lost, although some certainly temporarily. And as you all know, BJ's certainly suffered its share of operational and financial challenges due to the pandemic. The good news is, is that the better-positioned and well-operated full-service restaurant chains are now, for the most part, in a solid recovery mode. And like all recovering restaurant companies, BJ's is among them, we've improvised, we've adapted, we've done our best to overcome the events. But having said that, as we recover, we have challenges still ahead of us that we've got to deal with on a short-term basis. It can be said that I think in the darkest of hours and during the toughest of circumstances, the true character of a company and his people become more clearly evident. That can certainly be said about BJ's and our people. The strong character, integrity, the commitment of our people came to the forefront during the pandemic to effectively respond to the impacts on our business. Thanks to the effective and unwavering leadership of our senior leadership team, which I'll introduce here in a few minutes, all of BJ's constituencies were able to work together to ensure that BJ's could emerge from the other side of the pandemic with a strong financial and operational position. Our existing and new shareholders, our bank group, our investment bankers, our supplier partners, most of our landlords, our restaurant support team, our restaurant field supervision team and your Board of Directors executed their roles very smartly and vigorously. Importantly, it's the men and women on the front line of the pandemic battlefield that manage our 212 restaurants that deserve the most credit for successfully getting us through the worst of time. Now while the pandemic is not yet entirely behind us, the restaurant industry recovery is certainly underway. And as a result, it's creating some shorter-term challenges for us as we manage through the recovery regarding the availability of workers and short-term supply-demand imbalances in our supply chains, and this is affecting most restaurant companies, but we believe that these should gradually abate over time. But having said that, we've got some work to do to make sure that, that happens. We remain solidly optimistic that the best years for BJ's still remain ahead of us. We are blessed with a strong restaurant concept that can capture additional market share going forward. So on behalf of your Board of Directors and your senior leadership team, we sincerely appreciate and thank all of our shareholders and all of our constituencies for your continuing confidence in BJ's future. So thank you. And now, the 2 -- the 2021 Annual Meeting of the Shareholders of BJ's Restaurants, Inc. is hereby called to order. Our agenda today will include the formal business of the shareholder meeting as described in our proxy statement. After the formal shareholders' meeting is adjourned, we will take some additional time to answer questions from shareholders. [Operator Instructions] Before I begin the formal meeting, I'd like to introduce BJ's senior leadership team. First, it is my honor and privilege to introduce Mr. Greg Trojan, our Chief Executive Officer, who is here with me today. Greg's leadership has been nothing short of spectacular during his years as our CEO and in particular, during the pandemic. And thank you very much for that, for your leadership, Greg. In addition to Greg, we also have several of our senior leadership team members who are with us remotely today. Greg Levin, our President and Chief Financial Officer and Secretary; Lon Ledwith, our EVP of Operations; Greg Lynds, our EVP and Chief Development Officer; Kevin Mayer, our EVP and Chief Marketing Officer; Kendra Miller, our EVP and General Counsel; Alex Puchner, our Senior VP of Brewing Operations; Chris Pinsak, our Senior VP of Operations; Brian Krakower, our Senior VP and Chief Information Officer; Jake Guild, our Senior VP and Chief Accounting Officer; and last but not least, the most senior guy, I think, at our company, has been with BJ's, I believe, since 1996, Rob DeLiema, who is our President of our BJ's Restaurant Foundation and BJ's Give a Slice Foundation. In addition to our senior leadership, we also have some other company officers and team members with us remotely. And once again, I'd like to thank them for all of their hard work and contributions to BJ's, especially, dealing with the impact of the pandemic on our business and operations. I'd also like to do -- introduce and thank Mr. John Faulkner, the engagement partner from the accounting firm of Ernst & Young LLP, our independent registered public accountants; and Rob Steinberg of the law firm Elkins Kalt Weintraub Reuben Gartside LLP. Rob is our Securities and Governance Counsel. He's with us today, and I think Rob has also been involved with our business since the early 1990s. Both gentlemen will be available to respond to any questions raised by shareholders during our Q&A period in our agenda later this morning. Now on to the formalities of today's shareholders' meeting. The polls for voting on all matters before the meeting remain open. If you are a shareholder of record and have not voted or wish to change your vote, you may do so now by clicking on the link provided online. Any shareholder who has already voted and does not want to change their vote, they need not take any further action. On April 23, 2021, notice of the meeting was mailed to shareholders of record as of the close of business on April 13, 2021. A copy of the notice of the meeting, together with an affidavit of mailing, will be filed by the secretary with the minutes of this meeting. The Board of Directors of the company has appointed Heather Obi of Computershare, the company's transfer agent, to also act as inspector of election to count the votes that are represented and exercised at this meeting. The inspector of election has submitted to the secretary her oath as inspector, which has been duly subscribed by her, in which the secretary shall file with the minutes of this meeting. I have received a certification of quorum duly executed by the inspector of election stating that a majority of the outstanding shares are representing at this meeting in person or by proxy. This certification of quorum will be filed with the minutes of the meeting, and the final tabulation of shares represented will be presented later. We will now proceed to the election of the 11 directors previously submitted as nominees by the Board of Directors as described in the proxy statement as follows in alphabetical order: Peter A. Bassi, Larry D. Bouts, Bina Chaurasia, James A. Dal Pozzo, Gerald W. Deitchle, Noah A. Elbogen, Lea Anne S. Ottinger, Keith E. Pascal, Janet M. Sherlock, Gregory A. Trojan and Patrick D. Walsh. I would now like to introduce the nominees for Director in alphabetic order. Pete Bassi, the retired Chairman of Yum! Restaurants International, who also serves as our Lead Independent Director and Chairperson of our Governance and Nominating Committee. Larry Bouts, he's an investor, business advisor, former Chairman and CEO of Six Flags Theme Parks, who also serves as Chairperson of our Audit Committee. Bina Chaurasia, Chief Administrative Officer and Chief People Officer of Tanium, who joined our Board this past November. Jim Dal Pozzo, a longtime member of our Board, Chairman of the Board of The Jacmar Companies. Noah Elbogen, partner at Act III Holdings, LLC. Lea Anne Ottinger, Strategic Business Consultant and Managing Partner of LMR Advisors. And Ms. Ottinger also is the Chairperson of our Compensation Committee. Keith Pascal, a partner at Act III Holdings. Janet Sherlock, Chief Information Officer of Ralph Lauren Corporation. Greg Trojan, our CEO here at BJ's. And Patrick Walsh, Chief Executive Officer of Town Sports International Holdings and Managing Member and Chief Executive Officer of PW Partners, LLC. And I'm Jerry Deitchle, Chairman of the Board, retired CEO of BJ's. We will also vote today on the following proposals: number one, the ratification and approval of our amended and restated equity incentive plan; the approval, on an advisory and nonbinding basis, of the compensation of our named executive officers; and finally, the ratification of the Board's appointment of Ernst & Young LLP as the company's independent registered public accounting firm for fiscal year 2021. Each of these proposals is fully described in our proxy statement, a copy of which was previously mailed to shareholders of record and filed with the Securities and Exchange Commission. No shareholder has given notice at this meeting of such shareholders' intention to accumulate such shareholders' votes. Cumulative voting shall not apply with respect to the election of directors. Voting is now closed. Based on the preliminary view -- review of the votes cast, Heather Obi, our inspector of election, has provided me the report regarding the election of directors and the 3 shareholder proposals voted upon. I am reviewing that report. And according to the report of the inspector of election, every director received at least 96% of approved votes or for votes for the shares voted. Each of the 11 nominees for Director has been elected. I hereby declare that the 11 nominees for Director, namely: Gerald W. Deitchle, Gregory A. Trojan, Peter A. Bassi, Larry D. Bouts, Bina Chaurasia, James A. Dal Pozzo, Noah A. Elbogen, Lea Anne S. Ottinger, Keith E. Pascal, Janet M. Sherlock and Patrick D. Walsh have been hereby directed -- elected the Directors of the company to serve until the next Annual Meeting of Shareholders or until their successors are elected and qualified. Secondly, with respect to the proposal to ratify and approve BJ's Restaurants, Inc. amended and restated equity plan. According to the report from the inspector of election, approximately 92% of the votes cast voted in favor of the approval of this plan. I hereby declare that the proposal to ratify and approve BJ's Restaurants, Inc. amended and restated equity incentive plan has passed. With regard to the proposal to approve, on an advisory and nonbinding basis, the compensation of named executive officers described in the proxy statement. According to the report from the inspector of election, approximately 97% of the votes cast voted in favor of the resolution. I declare that the proposal to approve, on an advisory and nonbinding basis, the compensation of named executive officers has passed. And finally, with regard to the election of Ernst & Young LLP as the company's independent registered public accounting firm for fiscal year 2021. According to the report from the inspector of elections, approximately 99% of the votes cast voted in favor. So therefore, I declare that the selection of Ernst & Young LLP as the company's independent registered public accounting firm for fiscal year 2021 has been ratified and approved. Okay. That concludes the formal portion of our meeting, and the meeting is now formally adjourned. However, we will now do our best to answer any questions. Greg Trojan is with me today. [Operator Instructions] Now I'd like to introduce Rana Schirmer, who's our Director of SEC Reporting, who will read us the questions that have been submitted. Rana, do we have any questions?

Thank you, Jerry. No, there are no questions at this time.

All right. Well, thanks, everyone, for attending today. A final report of today's results will be available online in the next few days. And once again, on behalf of the Board of Directors and the management of BJ's, I'd like to thank you for your continuing support as we continue to effectively manage through our way through this pandemic. We continue to have strong confidence in our ability to eventually come out completely the other side of this pandemic with a solid competitive position and continued opportunities for growth and expansion. With that, we thank you, and goodbye.

This concludes the meeting. You may now disconnect.