Food & Beverage

Wendy's Q1 results trounce estimates

Wendy's said its breakfast is proving a winner, per its Q1 earnings results. (Photo: iStock)

May 12, 2021

That little freckle-faced gal on the front of Wendy's outlets may be smiling a little more visibly this morning thanks to first quarter earnings that definitely showed there's plenty of beef in this brand, which beat analysts' per share earnings estimates by 6 cents, coming in at 20 cents per share this morning.

In fact, the QSR's revenue of $460.2 million for the quarter also bested estimates of $444.1 million for the period that ended April 4 this year. .

Other key Q1 highlights include:

• Total revenues of $460.2 million this quarter, compared to $405 million last year's quarter, attributed to improved same-store sales, franchise royalty revenue and advertising funds.
• 17% company-operated restaurant margin compared to 10.1% in Q1 2020, attributed to higher average check totals and lower commodity costs.
• $83.1 million operating profit compared to $48.7 million in the same quarter last year, attributed to higher franchise royalty revenue and company-operated restaurant margin.
• $41.4 million quarterly net income, compared to $14.4 million last year's quarter attributed to higher operating profit.
• $121 million adjusted EBITDA compared to $89.3 million last year's quarter.
• 20-cent adjusted EPS compared to 9 cents last year's quarter.

"We are increasing our 2021 financial outlook meaningfully across all key financial metrics, driven by an outstanding first quarter that underscores our continued momentum and the overall strength of our business," President and CEO Todd Penegor said in the earnings information release.

"The robust growth in our business continued in the first quarter of 2021 as sales significantly exceeded our expectations and fueled our restaurant economic model, leading to outsized profits. We remain committed to our three long-term growth pillars — significantly building our breakfast daypart, accelerating our digital business, and expanding our footprint across the globe — and continue to make great progress. I have never been more confident that we will achieve our vision of becoming the world's most thriving and beloved restaurant brand as our system is stronger and more aligned than ever."

The company also announced an 11% increase in its regular quarterly cash dividend to 10-cents per share, payable on June 15, to stockholders of record as of June 1. Additionally, Wendy's board approved an increase to the the company's existing share repurchase authorization by $50 million to a total of $150 million, after the company exhausted its authorization due to favorable market conditions.