Q1 2024 Wendys Co Earnings Call Transcript
Key Points
- The Wendy's Co (WEN) reported a 90 basis point increase in global same-restaurant sales, with a 2-year basis growth of 8.9%, indicating strong ongoing performance.
- Digital sales momentum continued to be strong, with nearly 17% global digital sales mix and significant year-over-year increases, highlighting effective digital strategy implementation.
- The Wendy's Co (WEN) opened 35 new restaurants globally in Q1, aligning with their expansion strategy and supporting future growth.
- U.S. company-operated restaurant margin improved by 60 basis points year-over-year to 15.3%, driven by pricing strategies and operational efficiencies.
- The Wendy's Co (WEN) reaffirmed its 2024 financial outlook, expecting continued strong global system-wide sales growth and significant free cash flow, demonstrating confidence in their strategic plans.
- Despite overall growth, there was a noted decline in customer counts, which was only partially offset by pricing strategies aimed at average check growth.
- The increase in General and Administrative (G&A) expenses, driven by higher employee compensation and stock compensation, could impact profitability if not managed effectively.
- The Wendy's Co (WEN) faces challenges in the U.K. market, with investments there negatively impacting consolidated margins by approximately 60 basis points.
- Projected restaurant closures of over 100 for the year could indicate challenges in maintaining a stable operational footprint.
- While digital sales are growing, the heavy reliance on digital platforms and promotions may necessitate continuous investment to maintain engagement and competitiveness.
Good morning. Welcome to the Wendy's Company Earnings Results Conference Call. (Operator Instructions)
Kelsey Freed, Director of Investor Relations, you may begin your conference.
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Thank you, and good morning, everyone. Today's conference call and webcast includes a PowerPoint presentation, which is available on our Investor Relations website, irwendys.com.
Before we begin, please take note of the safe harbor statement that appears at the end of our earnings release. This disclosure reminds investors that certain information we may discuss today is forward-looking. Various factors could affect our results and cause those results to differ materially from the projections set forth in our forward-looking statements. Also, some of today's comments will reference non-GAAP financial measures. Investors should refer to reconciliations of non-GAAP financial measures to the most directly comparable GAAP measure at the end of this presentation or in our earnings release.
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