Q3 2024 Wendy's Co Earnings Call Transcript
Key Points
- The Wendy's Co (WEN) reported a 1.8% growth in global system-wide sales during the third quarter, with a 6.6% increase on a two-year basis.
- The digital sales grew almost 40% year over year, with the US segment delivering over a 17% digital sales mix.
- The company opened 64 new Wendy's restaurants globally in the third quarter and is on track to meet its goal of 250 to 300 openings for the full year.
- The morning-day part sales increased by mid-single digits, and late-night sales grew at a high-single-digit percentage compared to the prior year.
- International segment achieved high-single-digit system-wide sales growth, driven by nearly 100 new restaurant openings and strong performance in the Canadian market.
- US company restaurant margin remained flat at 15.6% due to labor rate inflation and customer count declines.
- Adjusted EBITDA decreased by 2.9% to approximately $135 million, primarily due to increased investment in breakfast and higher general and administrative expenses.
- The company plans to close additional underperforming restaurants with AUVs of approximately $1.1 million and operating margins below the system average.
- The decrease in adjusted earnings per share was driven by lower adjusted EBITDA, increased depreciation, and a higher effective tax rate.
- The macroeconomic environment was more challenging than expected, impacting consumer behavior and sales growth.
Good morning. Welcome to the Wendy's Company earnings results conference call. (Operator Instructions)
Thank you. You may begin your conference.
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Good morning, and thank you for joining our fiscal 2024 third-quarter earnings conference call.
After this brief introduction, Kirk Tanner, President and Chief Executive Officer, will provide a business update, and then Gunter Plosch, Chief Financial Officer, will review our third-quarter results and share our updated financial outlook. From there, we will open up the line for questions. Today's conference call and webcast includes a presentation which is available on our investor relations website, ir.wendys.com.
Before we begin, please take note of the Safe Harbor statement that appears at the end of today's earnings release. This disclosure reminds investors that certain information we discuss today is forward looking and reflects our current expectations about future plans and performance. Various factors could
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