Shake Shack(US:SHAK)2025-10-30 20:08Sales Performance - Same-Shack sales for the thirteen weeks ended September 24, 2025 increased 4.9% year-over-year, driven by a 3.6% increase in price mix and a 1.3% increase in guest traffic [108]. - Average weekly sales were $78,000 for the thirteen weeks ended September 24, 2025, compared to $76,000 for the same period last year, primarily due to higher menu prices [109]. - System-wide sales for the thirteen weeks ended September 24, 2025 increased 15.4% to $571.5 million compared to the same period last year [110]. - Digital sales for the thirteen weeks ended September 24, 2025 increased 19.1% to $124.2 million, representing 35.2% of Shack sales [111]. - Total revenue for the thirteen weeks ended September 24, 2025 was $367.4 million, a 15.9% increase from $316.9 million in the same period last year [114]. - Shack sales for the thirteen weeks ended September 24, 2025 increased 15.7% to $352.8 million, primarily due to the opening of 49 new Company-operated Shacks [116]. New Openings and Operations - The company opened 13 new Company-operated Shacks and seven new licensed Shacks during the thirteen weeks ended September 24, 2025 [112]. - As of September 24, 2025, there were 630 Shacks in operation, including 359 Company-operated and 271 licensed Shacks [112]. - The Company opened 49 new Company-operated Shacks between September 25, 2024, and September 24, 2025, contributing significantly to revenue growth [118]. - The Company experienced a closure of nine Company-operated Shacks in fiscal 2024, which partially offset some of the revenue increases from new openings [118]. Financial Performance - Net income attributable to Shake Shack Inc. for the thirteen weeks ended September 24, 2025 was $12.5 million, compared to a net loss of $10.2 million in the same period last year [114]. - Shack sales for the thirty-nine weeks ended September 24, 2025 increased 12.9% to $1,005.9 million compared to the same period last year, driven by the opening of 49 new Company-operated Shacks [118]. - Licensing revenue for the thirteen weeks ended September 24, 2025 increased 21.1% to $14.6 million, and for the thirty-nine weeks, it increased 17.8% to $38.9 million, primarily due to the opening of 29 net new licensed Shacks [120]. - Net income for the thirteen weeks ended September 24, 2025, was $13.7 million, compared to a loss of $11.1 million in the same period of 2024 [165]. - Adjusted EBITDA for the thirteen weeks ended September 24, 2025, was $54.1 million, representing a margin of 14.7%, compared to $45.8 million and a margin of 14.4% in 2024 [165][167]. Expenses and Costs - Food and paper costs for the thirteen weeks ended September 24, 2025 increased 20.2% to $103.5 million, and for the thirty-nine weeks, it increased 13.8% to $286.1 million, largely due to the opening of new Shacks [122]. - Labor and related expenses for the thirteen weeks ended September 24, 2025 increased 2.9% to $88.0 million, and for the thirty-nine weeks, it increased 3.6% to $262.8 million, influenced by the opening of new Shacks [125]. - Other operating expenses for the thirteen weeks ended September 24, 2025 increased 18.0% to $53.8 million, and for the thirty-nine weeks, it increased 16.3% to $152.8 million, primarily due to increased transaction costs and marketing spend [128]. - Occupancy and related expenses for the thirteen weeks ended September 24, 2025 increased 14.3% to $27.0 million, and for the thirty-nine weeks, it increased 11.9% to $77.2 million, mainly due to the opening of new Shacks [131]. - General and administrative expenses for the thirteen weeks ended September 24, 2025 increased 24.3% to $44.4 million, and for the thirty-nine weeks, it increased 16.4% to $125.7 million, driven by increased marketing investments and team costs [134]. - Depreciation and amortization expense for the thirteen weeks ended September 24, 2025 increased 5.3% to $27.1 million, and for the thirty-nine weeks, it increased 4.6% to $80.2 million, primarily due to new Shack openings [137]. Cash Flow and Financing - As of September 24, 2025, the company maintained a cash and cash equivalents balance of $357.8 million, an increase from $310.9 million at the end of the prior year [177][183]. - For the thirty-nine weeks ended September 24, 2025, net cash provided by operating activities was $159.2 million, up from $126.1 million for the same period in 2024, representing an increase of 26.2% [184]. - Net cash used in investing activities for the thirty-nine weeks ended September 24, 2025, was $106.7 million, compared to $31.4 million in the prior year, primarily due to the absence of $69.4 million in proceeds from maturities of held-to-maturity marketable securities [185]. - Net cash used in financing activities increased to $15.5 million for the thirty-nine weeks ended September 24, 2025, from $8.5 million in the prior year, mainly due to higher withholding taxes related to net settled equity awards [186]. - The company believes existing cash and cash equivalents, along with cash from operations, will be sufficient to meet its obligations for at least the next 12 months [181]. Tax and Income - Income tax expense for the thirteen weeks ended September 24, 2025 was $7.4 million, reflecting a significant increase of $11.3 million compared to the same period last year [149]. - The effective income tax rate for the thirteen weeks ended September 24, 2025 was 35.2%, up from 25.9% in the same period last year, primarily due to higher state income tax expenses [149]. - Net income attributable to non-controlling interests for the thirteen weeks ended September 24, 2025 increased to $1.2 million, compared to a loss of $0.9 million in the prior year [153]. Debt and Obligations - The company has obligations totaling $248.5 million under the Tax Receivable Agreement as of September 24, 2025, contingent upon future taxable income generation [180]. - The company entered into a Revolving Credit Facility allowing borrowings up to $50.0 million, with the potential to increase by an additional $100.0 million, subject to certain conditions [188]. - As of September 24, 2025, the company was in compliance with all covenants under the Revolving Credit Facility [192]. - The company issued $250.0 million aggregate principal amount of 0% Convertible Senior Notes due 2028, which will mature on March 1, 2028, unless converted or redeemed earlier [187].