Operations

Jack in the Box delivers on prediction of 4.2% same-store sales drop

Logo: File

May 14, 2020

After withdrawing its guidance nearly four weeks ago and warning its same-store sales would drop 4.2% in mid-April, Jack in the Box today delivered on its expected dismal Q2 performance. The company said for the quarter that ended on April 12 this year, systemwide same-store sales did indeed fall 4.2% for the quarter, compared to a 0.2% gain for the same quarter last year. 

The company previously said that in the seven weeks leading up to the start of the COVID-19-related business restrictions, the brand's system same-store sales had grown 5.2%.

"We are dedicated to remaining open to serve guests during this time of uncertainty," Jack in the Box Chairman and CEO Lenny Comma said in a press release accompanying today's Q2 results. 

"Given this uncertainty, we are prioritizing actions to bolster liquidity in the event we encounter greater volatility to our business. Because of this, we have temporarily suspended both share repurchases and the quarterly dividend typically paid next month with the intent to re-evaluate these decisions each quarter as we gain greater clarity on any further negative impact to our business trends."

Other key highlights of the company's second-quarter performance include: 

• Operating EPS was 50 cents, compared to 99 cents last year's quarter. 
• Q2 adjusted EBITDA fell from $61.2 million last year's quarter to $46.3 million this year. 
• Revenues were up from $215.2 million last year's quarter to $216.8 million this year.
• System sales were $770.3 million this year's quarter, compared to $798 million last year's quarter. 

The company said it has withdrawn its long-term guidance and will provide an update when it "can reasonably estimate the impacts of the COVID-19 pandemic on business results." As previously announced, the company also withdrew its guidance for the fiscal year ending September 27, 2020.