El Pollo Loco(US:LOCO)2025-03-06 21:09Financial Performance - Company-operated restaurant revenue for Q4 2024 increased to $95.6 million, up from $94.0 million in Q4 2023, reflecting a 1.6% increase in comparable restaurant revenue[5] - Total revenue for Q4 2024 was $114.3 million, compared to $112.2 million in Q4 2023, representing a year-over-year increase of 1.9%[6] - Net income for Q4 2024 was $6.0 million, or $0.20 per diluted share, compared to $4.4 million, or $0.14 per diluted share in Q4 2023, marking a 36.4% increase in net income[11] - Adjusted EBITDA for Q4 2024 was $14.3 million, an increase from $13.6 million in Q4 2023[6] - Total revenue for the thirteen weeks ended December 25, 2024, was $114,284,000, an increase from $112,247,000 for the same period in 2023, representing a growth of 1.8%[35] - Net income for the thirteen weeks ended December 25, 2024, was $5,953,000, up from $4,351,000 in the same period of 2023, indicating a growth of 37.0%[39] - Adjusted EBITDA for the thirteen weeks ended December 25, 2024, was $14,339,000, compared to $13,570,000 in the prior year, representing an increase of 5.7%[39] - The adjusted net income for the fifty-two weeks ended December 25, 2024, was $26.801 million, up from $24.526 million in 2023, reflecting a growth of 9.2%[45] Sales and Revenue Growth - System-wide comparable restaurant sales increased by 0.5% in Q4 2024, driven by a 9.0% increase in average check size, despite a 6.8% decrease in transactions[6][7] - Franchise revenue in Q4 2024 rose by 2.5% to $11.2 million, attributed to the opening of four new franchise-operated restaurants[8] - Comparable restaurant sales growth was 2.8% for the fifty-two weeks ended December 25, 2024, compared to 0.3% in the previous year[36] - Franchise revenue increased to $11,232,000 for the thirteen weeks ended December 25, 2024, from $10,956,000 in 2023, marking a growth of 2.5%[38] - System-wide sales for the thirteen weeks ended December 25, 2024, reached $262,248,000, compared to $257,619,000 in the same period of 2023, reflecting a growth of 1.0%[38] Expenses and Debt - General and administrative expenses for Q4 2024 were $11.1 million, up from $10.6 million in Q4 2023, primarily due to increased labor-related costs[10] - As of December 25, 2024, the company's outstanding debt was $71.0 million, with $2.5 million in cash and cash equivalents[12] - Total debt decreased to $71,000,000 as of December 25, 2024, down from $84,000,000 as of December 27, 2023[36] Restaurant Operations and Expansion - The company plans to open one to two new company-operated restaurants and eight to nine new franchised restaurants in 2025[13] - The number of company-operated restaurants at the end of the period increased to 173 from 172 in the previous year[36] - El Pollo Loco operates over 495 company-owned and franchised restaurants across seven U.S. states and has ten licensed locations in the Philippines[27] Strategic Focus and Risks - The company aims to expand its digital business, delivery orders, and catering services to enhance customer engagement[29] - The company is subject to various risks, including inflationary pressures and changes in consumer spending, which could impact financial performance[29] - The company faces challenges in opening new restaurants, including site selection and lease negotiations[29] Financial Reporting and Measures - El Pollo Loco utilizes non-GAAP financial measures such as System-wide sales and Adjusted EBITDA to evaluate operational performance[32] - The company is committed to transparency in its financial reporting, providing reconciliations of non-GAAP measures to GAAP measures[33] - El Pollo Loco's financial measures may not be directly comparable to those of other companies, highlighting the importance of context in financial analysis[33] Other Financial Details - The restaurant contribution margin for the thirteen weeks ended December 25, 2024, was 16.7%, compared to 15.8% in the same period of 2023, showing an improvement of 0.9 percentage points[46] - During the year ended December 25, 2024, the company recognized non-cash impairment charges of $0.1 million, primarily related to two restaurants in Nevada[41] - The company completed the sale of one restaurant in California for cash proceeds of $0.1 million during the year ended December 25, 2024, resulting in a net loss of less than $0.1 million[40] - In the year ended December 27, 2023, the company sold 18 restaurants for cash proceeds of $7.7 million, resulting in a net gain of $5.0 million[40] - Restructuring charges incurred in the year ended December 25, 2024, amounted to $551,000, while the previous year saw restructuring costs of $1.055 million[45] - The company recorded a loss on disposal of assets of $40,000 for the thirteen weeks ended December 25, 2024, compared to a loss of $226,000 for the same period in 2023[46]