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Financials - December 2022





Bertucci’s declares bankruptcy for second time



Published Dec. 6, 2022




Julie Littman Senior Reporter





Dive Brief:

  1. Bertucci’s Restaurants filed for Chapter 11 bankruptcy protection on Monday, according to court documents viewed by Restaurant Dive.

  2. The company formed in April 2018 after Bertucci’s Brick Oven Pizza & Pasta went bankrupt and Earl Enterprises bought it for $20 million.

  3. The 47-unit, Italian-themed restaurant said the impact of the COVID-19 pandemic, inflation, sales declines and increased expenses led it to declare bankruptcy for the second time in four years.


Dive Insight:

Bertucci’s has been offering promotions this year to try and get more guests in the door. In July, it temporarily lowered menu prices to 1980s levels for 14 items. In August, it launched Happy Hour and brought back its Throwback Thursdays promotion, which also priced menu items as they were in the 1980s. But these efforts don’t seem to have helped regain sales momentum lost during the pandemic.

While the casual pizza chain reported over $120 million in annual sales for 2019, sales fell to $97.9 million in 2021 and operating losses were $14 million with a net loss of $7.2 million, according to the filing. In 2018, the company had 56 locations, but its footprint shrank 16% as of 2022. Bertucci’s employee count also fell from roughly 2,000 in 2019 to 1,436 in 2022. Bertucci’s has over $20 million in secured debt, a tax obligation of $1.5 million and unsecured debt of about $26.5 million, according to the filing.

Restaurant bankruptcies have been few and far between this year. Dynamic Restaurant Holdings declared bankruptcy in September, while BLT Restaurant Group declared bankruptcy in March, in part because it was unable to repay its $3.3 million Paycheck Protection Program loan.

View source version at Bertucci's


NRD Capital Announces Agreement to Sell Fuzzy’s Taco Shop to Dine Brands




December 05, 2022 06:46 AM Eastern Standard Time


ATLANTA--(BUSINESS WIRE)--NRD Capital Management, LLC (“NRD”), a private capital firm headquartered in Atlanta, is pleased to announce that Fuzzy’s Taco Shop®, a portfolio company of its Experiential Brands platform, has entered into a definitive agreement with Dine Brands Global, Inc. (NYSE: DIN), one of the world’s largest full-service dining companies and franchisor of Applebee’s Grill + Bar® and IHOP® restaurants, for a purchase price of $80 million dollars.

Fuzzy’s Taco Shop was founded in 2003 in Fort Worth, Texas and is a fast casual restaurant serving Mexican favorites with a splash of Baja. Since acquiring a significant majority stake in 2016, NRD partnered with founder Mel Knight to nearly double the unit count while improving underlying unit-level economics for franchisees.

“This transaction is a textbook example of how NRD identifies and grows brands, which can result in successful outcomes for all stakeholders, including company management, company employees, franchisees and investors of NRD Capital,” said Aziz Hashim, NRD’s Managing Partner. “NRD is incredibly proud of the work it has done alongside the talented Fuzzy’s Taco Shop team to drive growth and propel value creation.”

“We had many options when evaluating the ideal partner to help accelerate the growth of Fuzzy’s Taco Shop,” said Knight. “We selected NRD because of their operator-centric mentality, flexible capital and unparalleled franchising experience. Without a doubt, they over-delivered on each promise and initiative. Partnering with NRD to improve our unit level economics and supercharge franchise development was instrumental in leading Fuzzy’s to be the successful national brand that it is today.”

Arlington Capital Advisors served as exclusive financial advisor to Fuzzy’s Taco Shop, with Cheng Cohen LLC serving as legal advisor to Fuzzy’s Taco Shop and NRD Capital. Centerview Partners LLC served as exclusive financial advisor to Dine Brands, with Sidley Austin LLP serving as legal advisor.

For more information about NRD Capital, please visit www.nrdcapital.com. For more information about Fuzzy’s Taco Shop, please visit www.fuzzystacoshop.com.

ABOUT NRD CAPITAL MANAGEMENT, LLC

NRD Capital Management, LLC is a middle-market private capital partner that offers flexible capital solutions and identifies investment opportunities in multi-unit brands offering superior products/services and compelling unit-level economics across franchising, consumer services, technologies, and restaurants. By infusing capital and applying operating expertise, NRD guides its investments toward sustainable strategic growth. For additional information, please visit www.nrdcapital.com.

ABOUT FUZZY’S TACO SHOP

Founded in 2003 near the Texas Christian University campus in Fort Worth, Fuzzy’s Taco Shop® is a fast casual restaurant serving Mexican favorites with a splash of Baja. The laid-back atmosphere pairs perfectly with signature Baja-style tacos, famous chips and queso and icy-cold beverages always served at a chill price. With 138 franchise- and corporate-owned locations in 18 states, Fuzzy’s Taco Shop was ranked a Top Food Franchise, Top Franchise for Culture, and Top Multi-Unit Franchise for 2021 by Franchise Business Review. They’ve also been recognized in Franchise Times “The Top 500 Issue” in 2022 and appeared in Entrepreneur’s 2021 Franchise 500 Ranking and Nation’s Restaurant News’ #10 “Fastest Growing Chains” of 2018. For franchising information, please visit www.MyFuzzys.com.

View source version at Fuzzy's Taco Shop



Jack in the Box Inc. Reports Fourth Quarter and Full-Year 2022 Earnings


Jack in the Box same-store sales of +4.0% in Q4 2022, +0.9% for FY 2022

Del Taco same-store sales of +5.2% in Q4 2022, +3.9%(1) for FY 2022

Systemwide sales of +4.1%(2) for Jack in the Box and +4.2%(2) for Del Taco in Q4 2022

Jack in the Box to open 25-30 restaurants, expects positive net unit growth in FY 2023

Jack in the Box completes refranchising of Nashville and Oregon evolving market restaurants, with development commitments for 42 new restaurants

Management provides company-wide and brand-specific annual guidance measures for FY 2023


November 22, 2022 08:30 AM Eastern Standard Time


SAN DIEGO--(BUSINESS WIRE)--Jack in the Box Inc. (NASDAQ: JACK) announced financial results for the Jack in the Box and Del Taco segments in the fourth quarter, ended October 2, 2022.

“I am very pleased with the momentum of our top line performance to close 2022, which we have seen continue into the first several weeks of Q1, and the consistency we showed throughout the year in driving sales and improving traffic, as we continue to remain careful on the price we are taking to maintain a consistent value equation for our guests,” said Darin Harris, Jack in the Box chief executive officer. “We continue to navigate operational headwinds, but Jack and Del Taco franchisees and operators showed their ability to be resilient and manage through them effectively all throughout 2022. While we will continue to attack the inflationary impact on margins, our top line fundamentals, operational focus, and expectation for positive net unit growth for Jack all demonstrate that 2023 will be a big year for our company and another positive step in the transformation of the Jack brand. The investments we are making in digital, technology and training, plus the continued integration and refranchising of Del Taco, have me enthusiastic for our future."

Jack in the Box Performance

Same-store sales increased 4.0% in the fourth quarter, comprised of an increase in Company-operated same-store sales of 11.4% and an increase in franchise same-store sales of 3.2%. Higher average check, driven mostly by pricing, and an increase in traffic drove the increase for company-operated while higher average check was partially offset by a decrease in traffic for franchise. Systemwide sales(2) for the fourth quarter increased 4.1%.

As of the fourth quarter, and since the launch of the development program in mid-2021, the Company currently has 68 signed agreements for a total of 267 new restaurants. Under these agreements, 22 restaurants have opened, leaving 245 remaining for future development. Net restaurant count was down 26 in the fourth quarter, with 7 franchise openings and 33 restaurant closures. Most of these closures were related to one-time and strategic factors such as Evolving Markets and portfolio optimization within the St. Louis market as it exited bankruptcy process. The 33 restaurant closures included 10 Company-operated restaurants as part of refranchising Evolving Markets, 22 with an early termination including 10 in the St. Louis market, and one franchise location with an agreement expiration.

Restaurant-Level Margin(3), a non-GAAP measure, was 16.2%, a decline from a year ago driven by increases in food and packaging costs; wage inflation of 11.3%; and increases in utilities and maintenance and repair costs, partially offset by menu price increases. Commodity costs increased in the quarter by approximately 14.9%, primarily due to increases in proteins, sauces and oil. When removing the temporary Evolving Markets, Restaurant-Level Margin was 19.5% for the quarter. During the fourth quarter, the Company completed the refranchising of two restaurants within the Nashville market, which also included four restaurant closures. This will remove all Nashville locations from the Evolving Markets portfolio beginning in Q1 2023, and also included development agreements for the first new franchisee for Jack in the Box in nearly a decade to open 7 restaurants in Baton Rouge, 16 restaurants in the Carolinas, and 14 in the Nashville area.

Franchise-Level Margin(3), a non-GAAP measure, was 42.4%, an increase from a year ago, driven by higher same-store sales as well as higher early termination fees in the current year.

View full version at Jack in the Box



BurgerFi Reports Third Quarter 2022 Results

November 16, 2022 07:00 ET



Revenue Grows 290% to $43.3 million in Third Quarter

First Anthony’s Multi-Unit Development Agreement Executed

Conference Call Today, November 16, at 8:30 a.m. ET

FORT LAUDERDALE, Fla., Nov. 16, 2022 (GLOBE NEWSWIRE) -- BurgerFi International, Inc. (Nasdaq: BFI, BFIIW) (“BurgerFi” or the “Company”), owner of one of the nation’s leading fast-casual “better burger” dining concepts through the BurgerFi brand, and the high-quality, casual dining pizza brand under the name Anthony’s Coal Fired Pizza & Wings (“Anthony’s”), today reported financial results for the third quarter ended October 3, 2022.

Highlights for the Third Quarter 2022

  1. Total revenue increased to $43.3 million in the third quarter 2022 compared to $11.1 million in the prior year quarter driven by the Anthony’s acquisition

  2. Consolidated systemwide sales increased 71% to $70.6 million compared to $41.4 million in the prior year quarter

  3. Systemwide sales for Anthony’s increased 4% to $31.5 million in the third quarter compared to prior year

  4. Systemwide sales for BurgerFi decreased 5% to $39.1 million in the third quarter compared to prior year

  5. Systemwide same-store sales growth of 3% at Anthony’s in the third quarter of 2022 compared to the prior year quarter

  6. Systemwide same-store sales decrease of 7% at BurgerFi in the third quarter of 2022 compared to the prior year quarter

  7. Opened nine new restaurants year to date and entered into first multi-unit development agreement for franchising Anthony’s

  8. Restaurant-level operating expenses improved 250 basis points when compared to the prior year quarter

  9. Net loss of $3.3 million or $(0.15) per diluted share in the third quarter 2022 compared to net loss of $5.0 million or $(0.28) per diluted share compared to prior year quarter.

  10. Adjusted EBITDA1 of $1.6 million in the third quarter 2022 compared to $0.2 million in the prior year quarter.

Management Commentary

Ophir Sternberg, Executive Chairman of BurgerFi, stated, “Our third quarter represents another quarter of growth as we experienced a nearly 290% increase in revenue and achieved almost eight times growth in adjusted EBITDA when compared to the prior year’s third quarter as a result of our acquisition of Anthony’s in November of 2021. We have two very high quality, differentiated brands that are on trend with the consumer. While we are an early stage growth company, I believe that we have long-term opportunities ahead for asset-light expansion and I am extremely excited to have signed our first multi-unit development agreement for Anthony’s as we execute on our growth strategy for that brand.”

Ian Baines, Chief Executive Officer of BurgerFi, added, “Our team remains laser focused on operational excellence and sales driving initiatives. This focus has begun to pay dividends as evident in the 3% increase in same stores sales at Anthony’s when compared to 2021. Notably, sales increased sequentially throughout the quarter at Anthony's and this positive momentum has since continued into the month of October where sales were above that of 2019 for the first time since the pandemic began. Additionally, we have seen some commodity costs stabilize which helped contribute to Anthony’s generating a 210 basis point improvement in restaurant level margins. At BurgerFi, we have embarked on a new brand campaign to further strengthen our position in the better burger category. We are also seeing an improvement in guest satisfaction scores which we believe will translate to stronger financial performance in the quarters to come. These positive developments give us confidence in the recovery of our margin profile.”

Baines continued, “Looking ahead, our 2023 pipeline is strong as we anticipate the opening of 15-20 new franchised BurgerFi restaurants. Additionally, we are excited to have signed our first co-branded agreement with one of our largest BurgerFi franchisees to add an Anthony’s menu to an existing BurgerFi location in the first half of next year. Co-branding is another opportunity for us to increase revenue and grow margins. ”

View full version at BurgerFi



Fiesta Restaurant Group, Inc. Reports Third Quarter 2022 Results


Third Quarter 2022 Comparable Restaurant Sales Growth of 9.3% vs. Third Quarter of 2021

Hurricane Ian Negatively Impacted Third Quarter Comparable Restaurant Sales by Approximately 2.6%

October 2022 Comparable Restaurant Sales Growth Accelerated to 12.9% vs. October of 2021


November 10, 2022 04:05 PM Eastern Standard Time


DALLAS--(BUSINESS WIRE)--Fiesta Restaurant Group, Inc. ("Fiesta" or the "Company") (NASDAQ: FRGI), parent company of the Pollo Tropical® restaurant brand, today reported results for the 13-week third quarter, which ended on October 2, 2022, and provided a business update related to current operations.

Fiesta President and Chief Executive Officer Richard Stockinger said, "The third quarter of 2022 was a positive quarter for the business, with progress being made on all fronts and meaningful quarter over quarter gains, despite the impact of Hurricane Ian on our operations. We demonstrated ongoing traction across our key priorities of driving traffic growth and improving margins, and our strategic growth initiatives are building momentum."

Stockinger continued, "Our comparable restaurant sales improved to double digit growth in the third quarter, excluding the impact of the hurricane, and further accelerated in October. Moreover, our comparable traffic increased approximately 140 basis points from the second to the third quarter, inclusive of the negative impact of the hurricane of approximately 220 basis points. In addition, we realized year-over-year positive traffic growth in multiple key markets(1). Our accelerating comparable transaction momentum was the direct result of the actions we shared previously to improve staffing, expand our sales growth initiatives and continue our successful pairing of value item pricing with check accretive limited time offers. Staffing levels rose measurably in the third quarter vs. the second quarter and further increased in October, which, along with the ongoing impact of our sales growth initiatives, should enable us to further accelerate comparable traffic growth across all channels in the fourth quarter."

Stockinger added, "Third quarter 2022 loss from operations was $3.2 million and (3.4%) of restaurant sales compared to a loss from operations in the third quarter 2021 of $3.8 million and (4.4%) of restaurant sales. The decrease in loss from operations was primarily driven by increased revenue partially offset by expenses related to the hurricane and increased commodity costs and restaurant operating expenses."

Stockinger further commented, "We generated year-over-year growth in third quarter 2022 Restaurant-level Operating Profit(2) a non-GAAP financial measure, driven by our strong comparable sales growth and margin improvement actions in the face of ongoing inflation headwinds and the hurricane. Restaurant-level Operating Profit Margins were 14.1% of restaurant sales for the third quarter 2022 compared to 14.7% in 2021. The estimated impact from the hurricane on Restaurant-level Operating Profit was approximately $1.6 million or 150 basis points of restaurant sales. After considering the hurricane impact, we were pleased with our margin growth in the quarter, and particularly the margin run rate at the end of the quarter following our 4.0% September price increase. We will continue to drive improvement in Restaurant-level Operating Profit margins and expect to exit 2022 at our targeted margin range of 18% to 20% on a run rate basis."

Stockinger added, "We also made significant progress during the third quarter on the brand’s previously communicated key growth initiatives. Our refresh/remodel program continues to generate consistent sales growth in comparison to Pollo local market unit trends(3). Refreshes to date have generated a sales lift of approximately 4.0%, above our initial expectations. We completed 26 refreshes and remodels through the end of the third quarter and expect to complete 4-6 additional units in the fourth quarter of 2022. G&A expense reduction plans are also being implemented including but not limited to the outsourcing of accounting transaction processing and downsizing our Dallas service center office space, which will meaningfully contribute to an ultimate reduction in G&A to our targeted range of 8.5% to 9.0% of restaurant sales. Finally, we made additional progress on improving kitchen and drive thru productivity in high volume units. We completed our first kitchen retrofit unit with encouraging early sales and productivity results and are planning additional kitchen retrofits as part of our ongoing remodel efforts. As we realize the full impact of our growth initiatives, we expect them to contribute meaningfully to sales momentum and margin improvement."

Stockinger concluded, "We are encouraged by our continued strong sales momentum and the traction on our growth initiatives thus far in 2022 and are intensely focused on driving ongoing traffic growth across all channels while also taking action to improve margins."

View full version at Fiesta Restaurant Group



Kura Sushi USA Announces Fiscal Fourth Quarter and Fiscal Year 2022 Financial Results

November 10, 2022 16:05 ET



IRVINE, Calif., Nov. 10, 2022 (GLOBE NEWSWIRE) -- Kura Sushi USA, Inc. (“Kura Sushi” or the “Company”) (NASDAQ: KRUS), a technology-enabled Japanese restaurant concept, today announced financial results for the fiscal fourth quarter and fiscal year ended August 31, 2022.

Fiscal Fourth Quarter 2022 Highlights

  1. Total sales were $42.0 million, compared to $27.9 million in the fourth quarter of 2021;

  2. Comparable restaurant sales increased 27.6% for the fourth quarter of 2022 as compared to the fourth quarter of 2021;

  3. Operating income was $1.9 million, compared to operating loss of $0.8 million in the fourth quarter of 2021;

  4. Net income was $1.9 million, or $0.19 per diluted share, compared to net loss of $0.8 million, or $(0.09) per diluted share, in the fourth quarter of 2021;

  5. Adjusted net income* was $2.1 million, or $0.21 per diluted share, compared to an adjusted net loss* of $1.4 million or $(0.15) per diluted share, in the fourth quarter of 2021;

  6. Restaurant-level operating profit* was $10.0 million, or 23.9% of sales;

  7. Adjusted EBITDA* was $4.8 million; and

  8. Three new restaurants opened during the fiscal fourth quarter of 2022.

* Adjusted net income (loss), Restaurant-level operating profit and Adjusted EBITDA are non-GAAP measures and are defined below under “Key Financial Definitions.” Please see the reconciliation of non-GAAP measures accompanying this release. See also “Non-GAAP Financial Measures” below.

Hajime Uba, President and Chief Executive Officer of Kura Sushi, stated, “We continued to see strong sales performance in our fourth quarter, with comparable sales growth of 27.6% as compared to the prior year period. I am especially pleased to note that part of these strong comparable sales were 14.6% of traffic growth.”

Uba added, “During our fiscal fourth quarter we opened three new restaurants in Novi, MI; Orlando, FL; and Tysons, VA. I am extremely proud of our development team for achieving 25% unit growth for our fiscal year, in spite of industry-wide construction headwinds, and for the work that our operations team has done to deliver such strong restaurant openings.”

View full version at Kura Sushi



Toast Announces Third Quarter 2022 Financial Results


Exceeded $100B in annualized run-rate GPV for the first quarter ever Third quarter subscription revenue grew 96% year-over-year Annualized recurring run-rate (ARR) as of September 30, 2022 grew 60% year-over-year


November 10, 2022 04:05 PM Eastern Standard Time


BOSTON--(BUSINESS WIRE)--Toast (NYSE: TOST), the all-in-one digital technology platform built for restaurants, today reported financial results for the third quarter ended September 30, 2022.

"Toast delivered strong results in the third quarter, surpassing $100 billion in annualized GPV for the first time and driving sustained revenue momentum and continued margin improvement,” said Toast CEO, Chris Comparato. “We continue to balance efficiency with disciplined investments in innovation to power the restaurant industry. The launch of Toast Invoicing is the latest example of how we help restaurants efficiently grow their business through our leading integrated platform. At a time when restaurants need a trusted technology partner more than ever, we remain focused on helping our customers drive efficiency, grow their business and continue to successfully adapt to the dynamic operating environment.”

Financial Highlights for the Third Quarter of 2022

  1. Total locations increased over 40% year-over-year to approximately 74,000.

  2. Revenue grew 55% year-over year to $752 million.

  3. ARR as of September 30, 2022 was $868 million, up 60% year-over-year.

  4. Gross Payment Volume (GPV) increased 53% year-over-year to $25.2 billion.

  5. Gross profit of $151 million was up 82% year-over-year from Q3 2021. Non-GAAP gross profit grew 78% year-over year to $164 million.

  6. Net loss was $98 million in Q3 2022 compared to net loss of $254 million in Q3 2021. Adjusted EBITDA was $(19) million in Q3 2022 compared to Adjusted EBITDA of $(12) million in Q3 2021.

  7. Net cash used in operating activities of $(69) million and Free Cash Flow of $(80) million in Q3 2022, compared to net cash used in operating activities of $(18) million and Free Cash Flow of $(22) million, respectively, in Q3 2021.

For more information on the non-GAAP financial measures and key metrics discussed in this press release, please see the sections titled “Key Business Metrics” and “Non-GAAP Financial Measures,” as well as the reconciliations of non-GAAP financial measures to their nearest comparable GAAP financial measures at the end of this press release.

Outlook

For the fourth quarter ending December 31, 2022, Toast expects to report:

  1. Revenue in the range of $730 million to $760 million

  2. Adjusted EBITDA in the range of $(30) million to $(20) million

For the full year ending December 31, 2022, Toast expects to report:

  1. Revenue in the range of $2,692 million to $2,722 million (up from $2,620 million to $2,660 million)

  2. Adjusted EBITDA in the range of $(127) million to $(117) million (up from $(160) million to $(140) million)

The outlook provided above constitutes forward-looking information within the meaning of applicable securities laws and is based on a number of assumptions and subject to a number of risks. See cautionary note regarding “Forward-looking Statements” below.

View full version at Toast



US Foods Reports Third Quarter Fiscal Year 2022 Earnings


Announces $500 Million Share Repurchase Program


November 10, 2022 06:45 AM Eastern Standard Time


ROSEMONT, Ill.--(BUSINESS WIRE)--US Foods Holding Corp. (NYSE: USFD), one of the largest foodservice distributors in the United States, today announced results for the third quarter fiscal year 2022.

Third Quarter Fiscal 2022 Highlights

  1. Net income available to common shareholders improved to $100 million

  2. Adjusted EBITDA increased 20.6% to $351 million

  3. Diluted EPS was $0.43; Adjusted Diluted EPS was $0.60

  4. Net sales increased 13.0% to $8.9 billion

  5. Total case volume increased 0.7%; independent restaurant case volume increased 2.9%

  6. Gross profit increased 17.6% to $1.5 billion

Nine Month Fiscal 2022 Highlights

  1. Net income available to common shareholders was $145 million

  2. Adjusted EBITDA increased 20.8% to $960 million

  3. Diluted EPS was $0.64; Adjusted Diluted EPS was $1.59

  4. Net sales increased 16.9% to $25.5 billion

  5. Total case volume increased 1.3%; independent restaurant case volume increased 3.8%

  6. Gross profit increased 18.3% to $4.0 billion

CEO Perspective

“US Foods delivered strong results in the third quarter as we continue to execute on the three pillars of our long-range plan, which we introduced earlier this year,” said Andrew Iacobucci, Interim CEO. “Our performance reflects sustained positive momentum, as we drove profitable market share in key customer types and effectively managed gross profit and operating expenses. Our nearly 21% adjusted EBITDA growth underscores our confidence in achieving the high end of our prior adjusted outlook for the year and reflects the progress we are making on our long-range plan. Finally, further highlighting confidence in our future, our Board has authorized a $500 million share repurchase program, which we see as highly accretive to shareholder value at our current share price.”

Third Quarter Fiscal 2022 Results

Net income available to common shareholders was $100 million, an improvement of $45 million compared to the prior year. Adjusted EBITDA was $351 million, an increase of $60 million or 20.6%, compared to the prior year. Adjusted EBITDA margin was 3.9%, an increase of 20 basis points compared to the prior year. Diluted EPS was $0.43; Adjusted Diluted EPS was $0.60.

Net sales were $8.9 billion for the quarter, an increase of 13.0% from the prior year, driven by food cost inflation of 12% compared to the same quarter a year ago. Total case volume increased 0.7% from the prior year driven by a 2.9% increase in independent restaurant case volume, a 19.7% increase in hospitality volume and a 2.7% increase in healthcare volume, offset by a 6.8% decrease in chain volume. Year-over-year total case growth for the third quarter was negatively impacted approximately 2.0% by the planned mid-2021 exit of the lower margin grocery retail business the Company temporarily added during the pandemic and the strategic exit of a small number of lower margin chain restaurant and education customers.

Gross profit was $1.5 billion, an increase of 17.6% from the prior year. Key drivers included optimized pricing, increased freight income from improved inbound logistics, cost of goods sold optimization and food cost inflation in multiple product categories. The Company’s LIFO method of inventory costing resulted in an expense of $6 million in 2022 compared to expense of $32 million in 2021 due to inflation in multiple product categories including grocery, disposables and pork. Gross profit as a percentage of Net sales was 16.4%. Adjusted Gross profit was $1.5 billion, a 15.2% increase from the prior year. Adjusted Gross profit as a percentage of Net sales was 16.4% and adjusted Gross profit per case continued at strong levels due to the aforementioned factors.

Total operating expenses of $1.2 billion increased by $140 million, or 12.7% from the prior year. Operating expenses increased primarily driven by higher distribution costs, reflecting higher labor costs as a result of increased turnover and higher than normal wage inflation. These increases were partially offset by cost savings initiatives outlined in the long-range plan including: (1) further routing improvements, (2) completion of new warehouse selection technology implementation, and (3) the rollout of new warehouse process enhancements. Operating expenses as a percent of Net sales were 14.0%. Adjusted Operating expenses for the quarter were $1.1 billion, an increase of $132 million or 13.4% from the prior year due to the aforementioned factors. Adjusted Operating expenses as a percent of Net sales were 12.6%.

View full version at US Foods



Dutch Bros Inc. Announces Third Quarter 2022 Financial Results


Opened a Record 38 Shops, Revenues Increased 53% Year-over-Year to $198.6 Million

Raises Annual Guidance for Total Revenues

Targets 150 New Shop Openings for 2023; Reaching 800 Shops by the End of Next Year


November 09, 2022 04:05 PM Eastern Standard Time


GRANTS PASS, Ore.--(BUSINESS WIRE)--Dutch Bros Inc. (NYSE: BROS; “Dutch Bros” or the “Company”) one of the fastest-growing brands in the food service and restaurant industry in the United States by location count, today reported financial results for the third quarter ended September 30, 2022.

Joth Ricci, Chief Executive Officer and President of Dutch Bros Inc., stated, “We continue to execute our growth strategy, leveraging our strong team to open new shops and our proven operational playbook and loyalty program to engage and connect with new and existing customers. In the third quarter, we opened a record 38 shops, grew our revenue by more than 50%, and once again expanded our company-operated shop gross margins quarter-over-quarter. For perspective, we opened almost as many shops this quarter as we did during the entire year of 2019 and have opened at least 30 shops in 5 consecutive quarters. Dutch Bros’ portability and brand acceptance remains impressive as we grow from west to east across the country. Our 2020 and 2021 classes of new shops are generating annualized volumes that are approximately 10% higher than our system average and are exhibiting predictable and consistent sales performance and upward margin progression.”

He added, “Our new shops are fueling revenue growth, which increased 53.0% year-over-year to $198.6 million. Company-operated shop gross margins improved in the third quarter to 20.0%, 60bps higher than the second quarter and 720bps higher than the first quarter. During the quarter, we took pricing actions to partially combat inflationary pressures and benefited from operational improvements as well as the increased weighting of newer, higher-margin shops in our portfolio. We are now raising our annual revenue guidance based upon the performance of our new shops and our strong pipeline and remain confident in our expectation to generate at least $90.0 million in adjusted EBITDA1 this year.”

He concluded, “We expect to cap off our first full year as a public company by reaching our 2022 development target of at least 130 new shops. Based upon the availability of capable field leaders currently in our people development system and the total number of committed sites in our pipeline, we are targeting at least 150 new shop openings for 2023. This would enable us to reach 800 shops by the end of 2023, a goal we made as a private company five years ago when we had just 328 shops.”

View full version at Dutch Bros

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