#United States #Dallas #Financial Growth #Wingstop #Q1 Results

Wingstop Inc. Reports Record Fiscal First Quarter Results

Wingstop Inc., the beloved wings chain known for its bold flavors and expanding franchise network, has made headlines with its fiscal first quarter financial results for 2025, revealing not only robust growth amidst economic uncertainties but also a strategic commitment to expansion.

Financial Highlights

For the first quarter ending March 29, 2025, Wingstop reported remarkable achievements:

• - System-wide sales jumped by 15.7%, reaching an impressive $1.3 billion.
• - The company opened 126 net new locations, signifying 18.0% growth in its footprint compared to the same quarter in the previous year.
• - Domestic restaurants showed an increase in average unit volume (AUV), up to $2.1 million.
• - Digital sales surged to 72.0% of total sales, indicating a thriving online presence.
• - Total revenue grew by 17.4% to $171.1 million, with net income skyrocketing by 221.0% to $92.3 million, translating to $3.24 per diluted share. Adjusted metrics also showed positive trends, with adjusted net income at $28.3 million, or $0.99 per diluted share.

CEO's Insights

Michael Skipworth, Wingstop's President and CEO, reflected on these results stating, "Despite the challenging and unpredictable macro-environment, our first quarter results demonstrate the staying power of our strategies and resiliency in our model. We have opened a record 126 net new units; nearly doubling the number from last year. Our partners are experiencing industry-leading returns which will continues to fuel our development trajectory towards becoming a Top 10 Global Restaurant Brand."

Key Operational Metrics

Comparing key metrics to the same period last year highlights Wingstop's impressive momentum:

• - Total restaurants rose to 2,689, up from 2,279.
• - Domestic franchise operations grew to 2,250, while international franchise locations increased from 305 to 388.
• - Same-store sales experienced a slight uptick of 0.5%, a notable contrast to the 21.6% from the previous year but still indicative of steady traffic in a competitive market.

Revenue Breakdown

The increase in revenue is attributed to:

• - A boost in royalty revenue and franchise fees that rose to $78.8 million, primarily from net new franchise developments.
• - A notable increase in advertising fees due to the enhanced sales figures and adjustments in the national advertising fund contribution rate.
• - Despite rising operational costs, including labor and food pricing, Wingstop's sales strategy has enabled them to maintain profitability through smart fiscal management.

Looking Ahead

Wingstop remains optimistic about its future with updated guidance for 2025 projected to include:

• - A domestic same-store sales growth of approximately 1% (down from previous mid-single digit estimates) and a global unit growth rate of 16% to 17%.
• - Anticipated selling, general and administrative expenses projected around $140 million, which includes system implementation costs to support its growing infrastructure.

Commitment to Shareholders

Reflective of its strong cash flow, the Wingstop Board recently approved a quarterly dividend of $0.27 per share, amounting to nearly $7.5 million to be distributed to shareholders on June 6, 2025.

Strategic Repurchase Program

In a further commitment to enhancing shareholder value, Wingstop has repurchased significant shares under its repurchase program, emphasizing its strong market position and solid financial foundation.

Conclusion

All in all, Wingstop Inc. has positioned itself favorably in the restaurant market, overcoming various challenges through strategic decision-making and innovative growth measures. With an expert team, a strong brand identity, and a commitment to premium customer service, Wingstop looks set to continue its trajectory of success in 2025 and beyond. As they strive to become one of the top ten global restaurant brands, the coming year is likely to witness even more exciting developments from this iconic wings chain.