Jack in the Box (NASDAQ:JACK)
Same-store sales for Jack in the Box (NASDAQ:JACK) were up 7.8% in the first fiscal quarter of 2023, with franchise same-store sales coming in at 7.4% and company-operated same-store sales coming in at 12.6%. Although company-operated restaurants had an increase in both their average check and traffic during the quarter, franchise restaurants saw an increase in their average check but a reduction in traffic, primarily offset by the gain in average check. In the most recent quarter, same-store sales at Del Taco climbed by 3.0%. This gain comprised growth in franchise same-store sales of 2.8% and growth in company-operated same-store sales of 3.1%.
Because of good sales leverage and a shift in the mix of restaurants, restaurant-level profit increased by 150 basis points to 19.8% of sales. Because of improved sales and rent contribution, more income from the Hawaii deal, and reduced expenses toward lousy debt expense, the franchise-level margin increased by 280 basis points to 44.4 sales. This increase was driven by the fact that bad debt expenditure costs decreased. As a result, Jack in the Box stock surged today.
The restaurant operator had a positive net restaurant count for the quarter due to the launch of six franchise locations and the closing of one company-owned location. After the quarter, JACK had 2,046 sites that were franchised and 140 company-owned locations.
The CEO had this to say about the future: “Traffic increase and solid comps, together with planned positive net unit growth, enable us to generate considerable systemwide sales growth in 2023 and enhance franchise profitability in an operational environment that remains tough.”
In pre-market activity, Jack in the Box stock surged 5.57% higher to $82.77, which compares well to the stock’s 52-week trading range of $54.80 to $94.68.
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