Chicago Pizza & Brewery hasn’t commanded a dazzling stock price from Wall Street, with market value of about $38 million last week. But it has seen steady growth in its store locations, employee count and, more to the point, revenue in the past few years.
The Huntington Beach-based restaurant chain, which operates BJ’s restaurants, checks in at No. 25 on the Business Journal’s list of fastest-growing OC companies, which ranks public firms on their revenue growth over the three years ended June 30. Chicago Pizza recorded a 115% revenue gain in the period.
The company went public in 1996, when it had sales of $19.8 million. Each year since, Chicago Pizza & Brewery, which incorporates microbreweries into some of its units, has shown a revenue gain. It posted revenue of $52.3 million in 2000 vs. $37.4 million in 1999. Revenue for the six months ended June 30 was $31.3 million vs. $22.5 million in the year-ago period.
Driving the growth is that the restaurant chain, which started as a pizza operation with three locations and no more than 10 menu items, continues to roll out new stores. In 2000 it opened in Placentia, Burbank, West Covina and Huntington Beach. So far this year it has opened two restaurants, an 8,000-square-foot BJ’s Brewhouse in Irvine and a store in Chandler, Ariz., the company’s 28th location (it operates 16 restaurants in Southern California, including seven in OC).
Paul Motenko, Chicago Pizza’s co-chief executive, says more will come.
“I’m sure (Chandler) won’t be the last,” he said, noting that the company is planning to open four to six more in 2002.
And to meet that target, Chicago Pizza recently raised an additional $8 million in a sale of shares to its largest shareholder, BJ Chicago LLC. After the transaction, the company reported $27 million in equity and $12 million in cash.
Motenko and co-chief executive Jerry Hennessy are credited with spearheading the expansion. The two bought the chain, which consisted of three small pizza joints, from its founders in 1995.
A year later, the company expanded its concept to include bigger restaurants and a microbrewery element, and bought a chain of Pietro’s restaurants in the Northwest, which were later converted to BJ locations (Chicago Pizza still operates five Pietro’s restaurants in Oregon).
Things grew from there. Chicago Pizza started to roll out new locations that dwarfed earlier units.
For instance, Motenko said, an original Chicago Pizza restaurant employed 30 people, was 2,000 square feet to 3,000 square feet and posted about $1.5 million in revenue.
Now, he said each location ranges from 7,000 square feet to 10,000 square feet, employs 120 to 150 people and reports annual sales of $3.5 million to $6 million.
With the exception of its 1-year-old Valencia restaurant, which lagged behind, same-store sales for BJ’s restaurants increased 5.8% for the second quarter of 2001 vs. the 2000 quarter. Earnings were $985,000 for the second quarter vs. $199,000 in the prior-year period.
The expansion binge also has swelled Chicago Pizza’s employee count. The company now employs 723 people here vs. 270 last year. Company wide, the chain counts 2,100 people, up 300 employees, or 17%, from last year.
To keep up with increased demands and accommodate its administration and accounting division (formerly in Seattle), Chicago Pizza recently moved its headquarters from Mission Viejo to bigger digs in Huntington Beach.
And while the recession and Sept. 11 terrorist attacks on Washington, D.C., and New York have filled the air with uncertainty, Motenko is optimistic.
“We’re obviously concerned,” he said. “At the same time, it opens up opportunities for our growth because we think real estate opportunities will be coming by at a more rapid pace.” n
