Q4 2024 First Watch Restaurant Group Inc Earnings Call Transcript
Key Points
- First Watch Restaurant Group Inc (FWRG) achieved over $1 billion in total revenue and over $100 million in adjusted EBITDA for the first time in its history.
- The company opened 50 new restaurants in 2024, with a record 25 openings in the fourth quarter alone, contributing to a strong growth engine.
- New restaurants are on pace to generate third-year sales of $2.6 million, about 20% above the current system average unit volumes.
- FWRG plans to scale its marketing spend in 2025, leveraging technology investments to improve targeting and efficiency.
- The company has identified significant growth potential in the US, aiming to reach 2,200 locations, supported by a robust real estate and people pipeline.
- Same-restaurant sales were slightly negative at -0.3% in the fourth quarter, with a same-restaurant traffic decline of 3%.
- Commodity inflation, particularly in eggs, avocados, bacon, and coffee beans, is expected to remain high throughout 2025.
- The company anticipates adjusted EBITDA in the first quarter of 2025 to be around $4 million below the first quarter of 2024 due to new restaurant openings and commodity price spikes.
- Marketing spend as a percentage of sales remains below the industry average, which may limit immediate impact on brand awareness.
- FWRG faces challenges from elevated input costs and tariffs, which could pressure margins despite strategic pricing decisions.
Thank you for standing by and welcome to the First Watch Restaurant Group, Inc. fourth quarter earnings conference call occurring today, March 11, 2025, at 8:00 AM Eastern Time. (Operator Instructions) This call will be archived and available for replay at investors.firstwatch.com under the News & Events section.
I would now like to turn the conference over to Steven Marotta, Vice President of Investor Relations at First Watch to begin. Thank you.
Hello, everyone. I am joined by First Watch's Chief Executive Officer and President, Chris Tomasso and Chief Financial Officer, Mel Hope. This morning, First Watch issued its earnings release for the fourth quarter of fiscal 2024 on GlobeNewswire and filed its annual report on 10-K with the SEC.
These documents can be found at investors.firstwatch.com. This conference call will include forward-looking statements that are subject to various risks and uncertainties that could cause the company's actual results
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