Food & Beverage

Heftier check sizes boost Jack in the Box Q3 sales

Photo: iStock

August 6, 2020

Jack in the Box pulled out systemwide sales growth in the quarter that ended July 5 of 6.6%, driven by average check growth of 20.2%, though transactions were off more than 16%, the company said this morning in its quarter earnings report. EPS also grew to $1.40 per diluted share for the third quarter on earnings of $32.2 million, versus 51 cents per diluted share last year's quarter on operational earnings of $13.5 million.

Total revenues for Q3 came in at $242.3 million, beating estimates of $237 million. The company reported that systemwide traffic fell substantially due to the pandemic, but showed improvement in the last five weeks of the quarter. Check growth was the key to improved earnings over the period, although the company said that delivery costs and pandemic-related expenses dragged on performance.

Other results for the quarter include:

• Adjusted EBITDA(, a non-GAAP measure, was $72.9 million in the third quarter of fiscal 2020 compared with $57.8 million for the prior year quarter.
• 7.6% growth year-over-year in franchises royalties and revenues to $43.2 million.
• Franchise royalties and other revenues increased 7.6% year over year to $43.2 million.
• Comp sales up 4.1%, compared with 2.8% the previous year's quarter due to 20.2% average check growth, despite 16.1% transaction decline.
• Systemwide same-store sales grew 6.6%, compared to 2.7% growth last year's quarter.
• Net earnings grew to $32.5 million for the quarter, compared to $13.1 last year's quarter, but net earnings fell for the first 40 weeks of the system's fiscal year from $72.3 million last year to $51.9 million this year.

"In my first six weeks as CEO, I have witnessed the nimbleness and passion within this brand. …" said the company's relatively new CEO Darrin Harris in the earnings release. "Our strong performance in the third quarter is a testament to this agile approach. Our focus on value combined with indulgent and flavorful products continues to drive overall performance for the brand."