News

Bojangles' raises guidance thanks to robust sales growth

May 20, 2016

Things are looking up at Bojangles' with first quarter financial results prompting the company to boost its outlook for the year.

The financial prediction revamp comes on the heels of 24 consecutive quarters of restaurant sales growth. Steady increases in total revenues and income is also prompting the company to consider expanding in the southeast. 

Here's a look at some of the highlights for the first fiscal quarter, ending March 27:

• Two percent increase in systemwide comparable restaurant sales.
• 11.3 percent increase in total revenues to $127.7 million.
• Addition of nine systemwide restaurants – seven company-operated and two franchised.
• 36 percent increase in pro forma net income to $7.9 million.
• 31.3 percent increase in pro forma diluted net  income per share to $0.21.

"We have now generated system-wide comparable restaurant sales growth for 24 consecutive quarters. Bojangles' is a growing force in the fast casual and QSR space, and our track record of generating consistently strong results is, in part, a testament to our development strategy. We intend to expand our system by approximately 8 percent in net unit count during fiscal year 2016, by infilling our core North and South Carolina markets and developing in adjacent states within the southeast," said Bojangles' President and CEO Clifton Rutledge in an announcement.

Additional notes on first quarter performance

Systemwide comparable restaurant sales increased 2 percent, with company-operated and franchised comparable restaurant sales growth of 2.7 and 1.6 percent, respectively. Comparable restaurant sales growth at company-operated restaurants was due to price and transaction increases.

The increase in total revenues was primarily due to an additional net 36 systemwide restaurants at March 27, 2016 compared to March 29, 2015, as well as comparable restaurant sales growth at company-operated and franchised restaurants.

Company restaurant revenues and franchise royalty revenues increased 4 percent to $6.2 million in the first fiscal quarter of this year over last.

Restaurant contribution, a non-GAAP measure, increased 21.3 percent in the first quarter. As a percentage of company restaurant revenues, restaurant contribution margin, a non-GAAP measure, increased to 17.4 percent.

General and administrative expenses were also down nearly 13 percent this year over the same period last year, primarily because of expenses occurred first quarter of last year related to the public offering and other expenses, including transition to a new distributor.

The look ahead for the rest of the fiscal year

Bojangles' raised its annual guidance for the 52-week period ending on December 25, 2016 as follows:

• Total revenues of $535.0 million to $543.0 million (previously $533.0 million to $543.0 million).
• Systemwide comparable restaurant sales growth of low-single digits.
• Opening up to 65 systemwide restaurants.
• Net increase of 53 to 58 systemwide restaurants.
• Pro forma diluted net income per share of $0.89 to $0.93 (previously $0.86 to $0.90).