Noodles & pany(US:NDLS)2024-05-08 22:18Restaurant Operations - In the first quarter of 2024, Noodles & Company opened 2 new company-owned restaurants, bringing the total to 380 company-owned and 89 franchise restaurants across 31 states[61] - The company plans to open 10-12 new company-owned restaurants in 2024, a reduction from previous years, as it focuses on improving its operating model[61] - The company permanently closed 2 company-owned restaurants and 2 franchise restaurants in the first quarter of 2024[61] Financial Performance - Revenue for the fiscal quarter ended April 2, 2024, was impacted by a net loss of $6,140,000, compared to a net loss of $3,115,000 for the same period in the previous year[72] - EBITDA for the fiscal quarter ended April 2, 2024, was $3,274,000, down from $4,023,000 in the prior year, while adjusted EBITDA was $5,499,000 compared to $6,181,000[72] - Total revenue decreased by $4.7 million, or 3.7%, to $121.4 million in Q1 2024 compared to $126.1 million in Q1 2023, primarily due to lower guest traffic[82] - Comparable restaurant sales decreased by 5.4% in Q1 2024, with a 5.7% decrease at company-owned restaurants and a 4.5% decrease at franchise-owned restaurants[82] - Net loss increased to $6.1 million in Q1 2024, compared to a net loss of $3.1 million in Q1 2023, representing a 97.1% increase[81] Cost and Expenses - Labor costs have risen due to a competitive environment, but wage inflation has decelerated throughout 2023[60] - Labor costs decreased by $1.4 million, or 3.5%, in Q1 2024, remaining flat at 32.3% of restaurant revenue[84] - Occupancy costs increased by $0.3 million, or 3.0%, in Q1 2024, with occupancy costs as a percentage of revenue rising to 9.9%[86] - General and administrative expenses decreased by $0.6 million, or 4.4%, in Q1 2024, with expenses as a percentage of revenue decreasing to 10.7%[88] Debt and Interest - As of April 2, 2024, the company had $83.0 million of indebtedness and $3.0 million of letters of credit outstanding under its A&R Credit Agreement[106] - The average interest rate on outstanding borrowings was 8.85% during the first quarter of 2024, up from 4.09% in the first quarter of 2023, reflecting an increase in market base rates[109] - Interest expense, net rose by $1.0 million, or 105.9%, in Q1 2024 due to higher interest rates compared to Q1 2023[91] Inflation and Economic Conditions - Inflationary pressures are primarily from food, labor, energy costs, and materials, with total inflation remaining above historical averages[112] - The degree of inflation moderated in the first quarter of 2024 compared to 2023, but inflation is expected to continue affecting results in the near future[112] Legal and Compliance - The company has not been involved in any material legal proceedings as of the reporting date[117] - There have been no changes in internal control over financial reporting that materially affected the company during the most recent fiscal quarter[115] Capital Expenditures - Capital expenditures are estimated to be between $28.0 million and $32.0 million for fiscal year 2024, primarily for new restaurant openings[101] Commodity Price Volatility - The company continues to face challenges related to commodity price volatility, particularly in chicken products, but has seen improvements in 2023[59]