The following is a summary of the El Pollo Loco Holdings, Inc. (LOCO) Q1 2024 Earnings Call Transcript:
Financial Performance:
El Pollo Loco reported a total revenue increase of 1.4% to $116.2 million in Q1 2024, compared to $114.5 million in Q1 2023.
Company-operated restaurant revenue saw a decline of 0.7% while franchise revenue rose by 17.3% due to increased sales and franchise restaurant openings.
For Q1 2024, the restaurant contribution margin was 17.6%, an improvement from the 15% in Q1 2023.
General and administrative expenses increased by 50 basis points year-on-year, amounting to 10.3% of total revenue.
The GAAP net income for Q1 2024 was $5.9 million, or $0.19 per diluted share, a boost from $4.9 million or $0.13 per diluted share in Q1 2023.
Business Progress:
New CEO Liz Williams revealed a five-pillar strategic plan that includes a winning brand, hospitality mindset, digital first approach, improved unit economics, and unit growth.
As part of its digital strategy, consumer-facing technology investments are ongoing, with plans to roll out kiosks in all company-owned restaurants by summer 2024.
El Pollo Loco is undertaking efforts to reduce build costs for their restaurant prototype to improve growth and margins.
Increased support has been offered to franchise operators with the launch of new development incentives.
In order to cater to diverse consumer preferences, the company is using its varied menu by offering both value meals and premium items.
El Pollo Loco is making strides in development, with the first step being reduction of unit costs. More details are expected to be shared in upcoming disclosures.
The company has acknowledged the need to compete in promotional activities and is also working on providing everyday value across their menu, especially aiming at the sub-$10 price range products.
More details: El Pollo Loco IR
Tips: For more comprehensive details, please refer to the IR website. The article is only for investors' reference without any guidance or recommendation suggestions.