1Q23 Investor Call Summary

Jun 6, 2023 | Insights, Restaurant Research

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1Q23 $1B+ Restaurant Chain Summary
Chili’sGoal is to drive sales by eliminating aggressive promotions while increasing pricing & premium trade-up opportunities sufficient to invest in marketing & operations.
IHOPGuest dynamics remained consistent during the quarter, reflecting IHOP’s ability to retain its diverse customer base with menu innovation, attractive price points, abundant value and targeted loyalty deals.
Denny’sSales benefitted from trade-down from casual as consumer confidence and spending declined. However, the market is generally strong as indicated by a small increase in Denny’s value incidence from 14% to 15%.
Applebee’sResults driven by LTO menu innovation and abundant value programs. The brand kicked off 2023 with abundant value in the form of its 2 for $25 offer & $14.99 all-you-can-eat boneless wings, riblets & double crunch shrimp.
Burger 1Q23 SSS
McDonald’sResults were attributed to: strategic menu price increases; strong operations; effective marketing campaigns featuring the core menu; and continued digital & delivery growth.
Jack in the BoxResults were attributed to: hook & build strategy; successful marketing of its barbell menu; culturally relevant messaging; and improvements in hours of operation & ops execution.
Burger KingResults driven by menu price increases, creative messaging, compelling value initiatives (including the $5 Your Way meal) and 30%+ growth in digital sales.
Wendy’sResults were attributed to marketing, operational improvements, digital growth and late-night sales growth which was driven by a return to more normalized late-night hours, local advertising and its growing late-night delivery business.
Pizza HutSales helped by its $6.99 Melts (driven by its lowest-income consumers) and Big New Yorker which drove traffic from both existing & new customers.
Domino’sResults reflected +6% price during quarter, driven by last year’s price increases in its Mix & Match offers. Low income consumers continue to struggle with delivery costs.
Papa John’s1Q23 system comps were flat, lapping significant comp increases from 2022 (including its best January ever when customers were home from covid) and 2021. On a 2-year & 3-year stack, comps were up +2% & +28%, respectively.
WingstopManagement reported a “pantry full of consumer-tested flavor options with tremendous potential” to drive future LTOs.
Popeye’sResults helped by its Ghost Pepper Wings LTO in January which sold-out in 2 weeks and drove check & traffic.
KFCBrand objective is to target new audiences & category use occasions by leveraging relevant value & product innovation, as exemplified by the following boneless offering intros: the return of the Double Down sandwich; 2 for $5 wraps during 1Q; and chicken nuggets during 2Q.
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