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El Pollo Loco (LOCO) Q1 Earnings Beat, Revenues In Line
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El Pollo Loco Holdings, Inc. (LOCO - Free Report) grew 2% in afterhours trading on May 4, after the company reported first-quarter 2017 results wherein earnings beat the Zacks Consensus Estimate, while revenues came in line.
Earnings and Revenue Discussion
El Pollo Loco’s first-quarter adjusted earnings of 16 cents per share surpassed the Zacks Consensus Estimate of 14 cents by 14.3%. However, earnings declined 5.9% year over year due to lower margins and a higher share count.
El Pollo Loco Holdings, Inc. Price, Consensus and EPS Surprise
Revenues of $99.8 million were up 5.7% year over year on increase in company-operated restaurant as well as franchise revenues. In fact, revenues came almost in line with the Zacks Consensus Estimate of $100 million.
Behind the Headline Numbers
Notably, system-wide comps fell 0.3% due to a decrease in comps at both company-operated and franchise restaurants.
Company-operated restaurant sales were $93.4 million compared with $88.4 million in the year-ago quarter. Improvement of 5.7% in the sales was mainly because of the opening of 23 new restaurants during and subsequent to the first quarter of 2016.
Meanwhile, comps at company-operated restaurant decreased 0.4% due to a 2.2% drop in transactions, partially offset by a 1.9% increase in average check.
Franchise-operated restaurant sales increased 5.6% year over year to $6.3 million mainly due to the opening of 17 new restaurants during and subsequent to the first quarter of 2016.
Meanwhile, comps at Franchise restaurants were down 0.2% in the quarter.
Restaurant contribution was $19 million (20.3% of company-operated restaurant revenues) compared with $18.3 million (20.7% of company-operated restaurant revenues) in the first quarter of 2016. The decrease in restaurant contribution margin was mainly due to elevated labor charges, higher occupancy and other operating expenses associated with restaurant openings, somewhat offset by lower food and freight costs.
2017 Outlook
The company reaffirmed its previously issued guidance for 2017.
El Pollo Loco continues to expect 2017 pro forma earnings per share in the range of 65 cents to 69 cents. Meanwhile, the Zacks Consensus Estimate for 2017 earnings is pegged at 66 cents.
Adjusted EBITDA (Earnings before Interest, Tax, Depreciation and Amortization) is still expected in the band of $67.0 million to $70.0 million. Meanwhile, restaurant contribution margin is projected in the range of 20.4% to 20.8%.
Furthermore, it expects system-wide comparable restaurant sales growth of flat to up 2%, in line with the previous guidance.
Meanwhile, the company plans to open 15 to 20 new company-owned restaurants and 8 to12 new franchised restaurants in the year, as expected earlier.
Currently, El Pollo Loco carries a Zacks Rank #4 (Sell).
McDonald's Corp. (MCD - Free Report) reported first-quarter adjusted earnings per share of $1.47, beating the Zacks Consensus Estimate of $1.32 by 11.4%. Earnings also increased 18% year over year.
Chipotle Mexican Grill, Inc.’s (CMG - Free Report) first-quarter 2017 adjusted earnings were $1.60 per share outpaced the Zacks Consensus Estimate of $1.28 by 25%. Also, earnings compared favorably with the year-ago quarter figure of a loss of 88 cents per share, given a substantial rise in revenues.
In first-quarter 2017, Yum! Brands, Inc. (YUM - Free Report) posted earnings of 65 cents per share which outpaced the Zacks Consensus Estimate of 60 cents by 8.3%. Further, earnings increased 17% year over year due to lower share count.
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El Pollo Loco (LOCO) Q1 Earnings Beat, Revenues In Line
El Pollo Loco Holdings, Inc. (LOCO - Free Report) grew 2% in afterhours trading on May 4, after the company reported first-quarter 2017 results wherein earnings beat the Zacks Consensus Estimate, while revenues came in line.
Earnings and Revenue Discussion
El Pollo Loco’s first-quarter adjusted earnings of 16 cents per share surpassed the Zacks Consensus Estimate of 14 cents by 14.3%. However, earnings declined 5.9% year over year due to lower margins and a higher share count.
El Pollo Loco Holdings, Inc. Price, Consensus and EPS Surprise
El Pollo Loco Holdings, Inc. Price, Consensus and EPS Surprise | El Pollo Loco Holdings, Inc. Quote
Revenues of $99.8 million were up 5.7% year over year on increase in company-operated restaurant as well as franchise revenues. In fact, revenues came almost in line with the Zacks Consensus Estimate of $100 million.
Behind the Headline Numbers
Notably, system-wide comps fell 0.3% due to a decrease in comps at both company-operated and franchise restaurants.
Company-operated restaurant sales were $93.4 million compared with $88.4 million in the year-ago quarter. Improvement of 5.7% in the sales was mainly because of the opening of 23 new restaurants during and subsequent to the first quarter of 2016.
Meanwhile, comps at company-operated restaurant decreased 0.4% due to a 2.2% drop in transactions, partially offset by a 1.9% increase in average check.
Franchise-operated restaurant sales increased 5.6% year over year to $6.3 million mainly due to the opening of 17 new restaurants during and subsequent to the first quarter of 2016.
Meanwhile, comps at Franchise restaurants were down 0.2% in the quarter.
Restaurant contribution was $19 million (20.3% of company-operated restaurant revenues) compared with $18.3 million (20.7% of company-operated restaurant revenues) in the first quarter of 2016. The decrease in restaurant contribution margin was mainly due to elevated labor charges, higher occupancy and other operating expenses associated with restaurant openings, somewhat offset by lower food and freight costs.
2017 Outlook
The company reaffirmed its previously issued guidance for 2017.
El Pollo Loco continues to expect 2017 pro forma earnings per share in the range of 65 cents to 69 cents. Meanwhile, the Zacks Consensus Estimate for 2017 earnings is pegged at 66 cents.
Adjusted EBITDA (Earnings before Interest, Tax, Depreciation and Amortization) is still expected in the band of $67.0 million to $70.0 million. Meanwhile, restaurant contribution margin is projected in the range of 20.4% to 20.8%.
Furthermore, it expects system-wide comparable restaurant sales growth of flat to up 2%, in line with the previous guidance.
Meanwhile, the company plans to open 15 to 20 new company-owned restaurants and 8 to12 new franchised restaurants in the year, as expected earlier.
Currently, El Pollo Loco carries a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Peer Releases
McDonald's Corp. (MCD - Free Report) reported first-quarter adjusted earnings per share of $1.47, beating the Zacks Consensus Estimate of $1.32 by 11.4%. Earnings also increased 18% year over year.
Chipotle Mexican Grill, Inc.’s (CMG - Free Report) first-quarter 2017 adjusted earnings were $1.60 per share outpaced the Zacks Consensus Estimate of $1.28 by 25%. Also, earnings compared favorably with the year-ago quarter figure of a loss of 88 cents per share, given a substantial rise in revenues.
In first-quarter 2017, Yum! Brands, Inc. (YUM - Free Report) posted earnings of 65 cents per share which outpaced the Zacks Consensus Estimate of 60 cents by 8.3%. Further, earnings increased 17% year over year due to lower share count.
More Stock News: 8 Companies Verge on Apple-Like Run
Did you miss Apple's 9X stock explosion after they launched their iPhone in 2007? Now 2017 looks to be a pivotal year to get in on another emerging technology expected to rock the market. Demand could soar from almost nothing to $42 billion by 2025. Reports suggest it could save 10 million lives per decade which could in turn save $200 billion in U.S. healthcare costs.
A bonus Zacks Special Report names this breakthrough and the 8 best stocks to exploit it. Like Apple in 2007, these companies are already strong and coiling for potential mega-gains. Click to see them right now >>