Financial Data and Key Metrics Changes - For Q4 2024, global system-wide restaurant sales were $1.23 billion, down approximately 8% in constant currency, primarily due to an additional week of operations in the prior year [19] - North America comparable sales decreased by 4% in Q4, showing a 120 basis points sequential improvement from Q3 [19] - Adjusted operating income for Q4 was $37 million, down $10 million from the previous year, with an adjusted operating income margin of 7%, down from 8.3% in 2023 [24][25] Business Line Data and Key Metrics Changes - Company-owned restaurant revenue decreased by $18 million in Q4 compared to the prior year, driven by a decline in international and domestic comparable sales [23] - International comparable sales increased by 2% year-over-year in Q4, with strong performance in key markets like the Middle East [22][48] Market Data and Key Metrics Changes - North America average unit sales were approximately $1.1 million in 2024, with a focus on increasing market share through strategic new restaurant development [14] - Internationally, nearly 200 new restaurants were opened in 2024, with expectations to open a similar amount in 2025 [15] Company Strategy and Development Direction - The company is focusing on core product innovation, enhancing marketing messages, and investing in technology to improve customer experience and operational efficiency [6][7] - Strategic priorities include franchisee profitability and operational excellence, with a goal to increase market share through new restaurant development [7][14] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about entering 2025, highlighting sequential improvement in sales trends and opportunities for growth despite ongoing challenges [5][6] - For 2025, the company expects system-wide sales to increase by 25% compared to 2024, with North America comparable sales anticipated to be flat to up 2% [27] Other Important Information - The company plans to invest up to $25 million in marketing in 2025, focusing on both corporate and franchise markets [12][58] - The loyalty program has been revamped, with approximately 50% of loyalty orders now redeeming rewards, up from 21% a year ago [13][90] Q&A Session Summary Question: Industry expectations for 2025 and performance relative to the industry - Management acknowledged a value-focused environment and expects the pizza category to be flat to slightly down, but believes initiatives in loyalty and marketing will help gain market share [37][38] Question: International growth and market penetration - Management emphasized a focus on nine key international markets, indicating that they are not near saturation and see significant growth potential [44][48] Question: EBITDA guidance and investment breakdown - Management outlined that the EBITDA guidance for 2025 includes significant investments in marketing and franchisee support, with a focus on balancing value perception and franchisee profitability [54][58] Question: Ticket improvement expectations - Management expects ticket improvement driven by a return to a traditional pricing strategy and new product innovations [71][72] Question: Operations and menu simplification - Management reported progress in simplifying operations by removing low-performing SKUs and focusing on core menu items to enhance pizza quality [80][81]

Restaurant Operations - As of December 29, 2024, Papa John's operates 6,030 restaurants globally, with 3,514 in North America and 2,516 internationally, reflecting a net unit growth of 124 restaurants[26] - The company opened 310 new restaurants in 2024, with 198 of those being international locations, while 186 restaurants were closed[26] - The domestic company-owned restaurant growth strategy focuses on increasing market share and operational efficiencies through the opening of new locations[27] Franchise Operations - Franchise agreements in North America typically require a 5% royalty fee on sales, with most existing agreements having a 10-year term and a 10-year renewal option[30][31] - As of December 29, 2024, net loans outstanding to franchisees totaled $13.8 million, primarily for restaurant purchases and construction[35] Workforce and Employment - The company employs approximately 11,400 individuals, with around 8,800 working in company-owned restaurants, and estimates a total of 104,000 individuals in the Papa John's system including franchisees[40][41] - The company is committed to providing competitive pay and benefits, including a comprehensive benefits package and wellness services for team members[48][49] Marketing and Customer Engagement - The marketing strategy includes national advertising and a significant increase in digital marketing efforts, responding to rising customer engagement with online platforms[36] - The company expects to see more states in the U.S. enact data privacy laws that could affect marketing strategies[56] Supply Chain and Food Costs - Papa John's supply chain includes 11 QC Centers in the U.S. that produce dough and distribute key ingredients, ensuring consistent food quality across locations[53] - The company is actively managing food costs, especially cheese, through pricing agreements and forward purchase contracts[275] Industry Challenges - The U.S. Quick Service Restaurant pizza industry is highly competitive, with challenges from both large national chains and local independent operators, while international markets present growth opportunities[51][52] - The company has experienced inflationary pressures, particularly in food items, labor, and energy costs, which directly affect profitability and gross margins[275] - The company is facing challenges related to labor shortages and increased labor costs, which may impact restaurant operations[277] Regulatory and Compliance - The company is subject to various federal and state regulations regarding franchising, which may impact its operations and franchisee relationships[55] - The company anticipates no material environmental compliance-related capital expenditures for 2024 and 2025[60] Risk Management - The company is exposed to risks from geopolitical conflicts, which could impact its global operations[277] - The company has not guaranteed future performance in its forward-looking statements, which involve various risks and uncertainties[276] Intellectual Property - The company has a focus on protecting its intellectual property through trademarks and copyrights, and actively opposes any infringement[58] Investor Relations - The company utilizes its investor relations website as a primary channel for disclosing key information to investors[62]

Sales Performance - Global system-wide sales for Q4 2024 were approximately $1.2 billion, an 8% decrease from the prior year due to an additional week of operations in fiscal 2023[4] - North America comparable sales decreased by 4% in Q4 2024, with transactions and ticket down 2% each[4] - International comparable sales increased by 2% in Q4 2024 compared to the prior year[4] - For the full year 2024, global system-wide sales were approximately $4.9 billion, a 3% decrease from fiscal year 2023[8] - North America comparable sales for the full year 2024 were down 4%, with transactions down 3% and ticket down 1%[8] Restaurant Openings - Total net new restaurants opened in Q4 2024 reached 122, with 60 in North America and 62 internationally[4] - Total net new restaurants for fiscal year 2024 was 124, with 81 in North America and 43 internationally[8] - The company opened its 6,000th restaurant in fiscal year 2024, marking a significant growth milestone[2] Future Plans - The company plans to continue working with existing franchisees and welcoming new ones to expand in high-potential markets globally[2] - Final financial results for Q4 and fiscal year 2024 are expected to be released on February 27, 2025[6]

Core Insights - Papa Johns Canada has raised $73,411 through the sales of its Shaq-a-Roni pizza, which will provide over 222,000 meals to individuals facing food insecurity in Canada [1][3] - The Shaq-a-Roni campaign, running from October 21 to December 29, 2024, donates one dollar for each pizza sold, with each dollar funding three nutritious meals [2][3] - Since the launch of the Shaq-a-Roni partnership five years ago, Papa Johns has contributed more than $270,000 to communities across Canada [3] Company Overview - Papa John's International, Inc. is the world's third-largest pizza delivery company, operating over 5,900 restaurants in 50 countries and territories [4] - The company emphasizes high-quality ingredients, using fresh, never-frozen dough made from six ingredients, and real cheese made from mozzarella [4] - Papa John's was the first national pizza delivery chain to remove artificial flavors and synthetic colors from its entire food menu [4]

Core Viewpoint - Analysts forecast a significant decline in Papa John's quarterly earnings and revenues, indicating potential challenges for the company in the upcoming financial report [1]. Financial Performance Estimates - Expected earnings per share (EPS) for the upcoming quarter is $0.48, reflecting a year-over-year decline of 47.3% [1]. - Anticipated revenues are projected at $513 million, which represents a decline of 10.2% compared to the same quarter last year [1]. - Over the last 30 days, the consensus EPS estimate has been revised downward by 0.8% [2]. Revenue Breakdown - North America franchise royalties and fees are estimated to be $34.65 million, down 10.5% year-over-year [5]. - International revenues are projected at $34.25 million, indicating a significant decline of 28.9% year-over-year [5]. - Other revenues are expected to reach $59.87 million, reflecting a decrease of 4.9% from the prior year [6]. - North America commissary revenues are forecasted at $211.15 million, down 7.4% year-over-year [6]. Comparable Sales and Restaurant Metrics - Comparable sales growth for system-wide North America restaurants is estimated at -3.6%, a stark contrast to the previous year's growth of 11.2% [7]. - The number of system-wide restaurants is expected to reach 6,004, up from 5,906 in the same quarter last year [7]. - The number of franchised North America restaurants is projected at 2,967, compared to 2,902 a year ago [7]. - Total North America restaurants are estimated to be 3,496, slightly up from 3,433 year-over-year [8]. - International franchised restaurants are expected to reach 2,493, an increase from 2,356 in the same quarter last year [8]. - The number of international restaurants is projected at 2,501, compared to 2,473 in the same quarter last year [9]. Stock Performance - Papa John's shares have increased by 23.6% over the past month, contrasting with a -1.8% change in the Zacks S&P 500 composite [10]. - The company holds a Zacks Rank of 3 (Hold), suggesting it is expected to closely follow the overall market in the near term [10].

Core Points - Papa Johns Canada donated $73,411 to Second Harvest, aimed at combating food insecurity, with funds raised through the sale of the Shaq-a-Roni pizza [1][3] - The donation will provide over 222,000 meals to Canadians, highlighting the impact of the Shaq-a-Roni campaign [3] Company Overview - Papa John's International, Inc. was founded in 1984, focusing on high-quality ingredients for superior pizza [4] - The company operates more than 5,900 restaurants across 50 countries and territories, making it the world's third-largest pizza delivery company [4] - Papa John's has a commitment to removing artificial flavors and synthetic colors from its entire food menu [4]

Core Points - Papa Johns Canada has made a donation of $73,411 to Second Harvest, which will provide over 222,000 meals to Canadians in need, raised through the sales of the Shaq-a-Roni pizza [1][3] - The Shaq-a-Roni campaign has been running for five years, contributing over $270,000 to communities across Canada [3] - The cheque presentation event is scheduled for February 25, 2025, at Papa Johns in Scarborough, Ontario [2] Company Overview - Papa John's International, Inc. is the world's third-largest pizza delivery company, with over 5,900 restaurants in 50 countries and territories [4] - The company emphasizes high-quality ingredients, using fresh dough and real cheese, and has removed artificial flavors and synthetic colors from its menu [4] - Papa Johns Canada operates more than 200 locally owned and operated stores, focusing on community engagement and support [2]

Company Overview - Papa John's shares increased by 8.1% to close at $41.76, with trading volume significantly higher than usual, compared to a 2.5% gain over the past four weeks [1] Business Strategy - The company is benefiting from its "Back to BETTER 2.0" strategy, which includes product innovation, marketing enhancements, unit development, supply chain efficiency improvements, and leveraging the Papa Rewards loyalty program [2] Financial Performance Expectations - The upcoming quarterly earnings are expected to be $0.48 per share, reflecting a year-over-year decline of 47.3%, with revenues projected at $513 million, down 10.2% from the previous year [3] - The consensus EPS estimate has been revised 3.3% lower in the last 30 days, indicating a negative trend in earnings estimate revisions, which typically does not lead to price appreciation [4] Industry Context - Papa John's is part of the Zacks Retail - Restaurants industry, where Cheesecake Factory's consensus EPS estimate has increased by 1.1% to $0.91, representing a year-over-year change of 13.8% [4][5]

Core Insights - Papa John's International, Inc. reported preliminary results for the fourth quarter and fiscal year 2024, with a scheduled release of detailed results on February 27, 2025 [1] Sales Performance - In the fiscal fourth quarter ending December 29, 2024, global system-wide sales reached nearly $1.2 billion, representing an 8% decrease year over year; excluding the 53rd week in 2023, sales were roughly flat [2] - For fiscal 2024, global system-wide sales totaled about $4.9 billion, indicating a 3% decline from 2022 levels; excluding the additional 53rd week, sales were down approximately 1% [2] North American Market - Comparable sales in North America for the fourth quarter of fiscal 2024 fell by 4% year over year, attributed to declines in both transactions and ticket sizes; franchised restaurants saw a 4% drop, while domestic company-owned restaurants experienced a 6% decline [3] - For fiscal 2024, North America comparable sales were down 4% year over year, driven by a 3% fall in transactions and a 1% fall in ticket sizes [4] International Market - International comparable sales in the fiscal fourth quarter increased by 2% year over year [3] - In fiscal 2024, international comparable sales were down approximately 1% year over year [4] Store Developments - In fiscal 2024, Papa John's achieved a total of 124 net unit openings, including 81 in North America and 43 in international markets; the company had previously anticipated 50-60 new restaurant openings in North America [5] - The company celebrated the opening of its 6,000th restaurant and expressed appreciation for franchise partners' enthusiasm for growth prospects, reiterating plans to expand in key high-growth markets globally [6] Stock Performance and Market Outlook - Papa John's recent performance has raised concerns about its growth trajectory, with declining sales and weakening transaction volumes despite efforts under the Back to BETTER 2.0 strategy [7] - The stock trades at a forward P/E ratio of 15.64, significantly below the industry average of 24.41, which may indicate challenges; earnings estimates for fiscal 2025 have been revised downward, reflecting skepticism among analysts [8] - In the past three months, shares of Papa John's have declined by 27%, compared to a 6% fall in the industry [11]

Group 1 - The company specializes in analyzing restaurant stocks in the U.S. market, covering various segments such as QSR, fast casual, casual dining, fine dining, and family dining [1] - Advanced analytical models and specialized valuation techniques are employed to provide detailed insights and actionable strategies for investors [1] - The founder has a strong background in Business Administration and Accounting, with an MBA in Forensic Accounting and Controllership [1] Group 2 - The company actively engages in academic and journalistic initiatives, contributing to institutions that promote individual and economic freedom [1] - Previous experience includes being a columnist discussing monetary policy, financial education, and financial modeling [1] - The company also provides accounting and business consulting services across LATAM [1]