Full-year FY23 comp guidance was raised to mid-to-high single digits up from low single digits. Increasing operating & dining room hours provide a sales tailwind for the system.
RR 2023 Wendy’s Report
While Wendy’s has done well to magnify its significant menu prowess sufficient to generate a respectable +18% cumulative U.S. comp growth from 2019 – 2022, the chain must continue to work to translate its QSR+ positioning into increased frequency from a higher income demo sufficient to drive a higher check and store level profits.
RR 2023 IHOP Report
IHOP is well positioned as the largest player in the $1B+ family chain segment with 30% market share and the largest marketing budget in the segment. The chain is well known for: an unexpected twist on “all things breakfast, any time of the day”; world famous pancakes; flavored syrups; and the never empty coffee pot.
Overview of Darden’s Proposed Acquisition of Ruth’s Hospitality Group
Consumers with $150k+ income levels continue to dine out, and this demo expects to maintain or increase their spending at casual or fine-dining restaurants.
Texas Roadhouse’s 1Q23 Average Weekly Sales Increased +12.5% Y/Y
While strong traffic trends reveal customer acceptance of the chain’s pricing, new guests coming into Texas Roadhouse are starting on the value side of the menu and management reports a little bit of trade-down. In any case, its mix is still extremely positive relative to pre-covid levels.
Burger King’s Largest Franchisee Reports Strong 1Q23 Results
1Q23 comps increased +11.7% y/y (+9.7% price, +3.3% mix & -1.1% traffic), helped by a 7% reduction in discount mix & late-night traffic strength. The best 1Q restaurant-level adjusted EBITDA margin in 5 years (12.2%) reflected strong sales, moderating inflation & improved operational efficiencies.
Wendy’s 1Q23 System Comps Increased +7.2% Y/Y
Wendy’s reported that net disposable income is a big driver of restaurant sales & noted that decreasing grocery price inflation should drive net disposable income higher. Also, while traffic is flat for the under $75k consumer, traffic is growing for the over $75k demo.
Chili’s Fiscal 3Q23 Comps Increased +9.1% Y/Y
The brand goal is to drive sales by eliminating aggressive promotions while increasing pricing & premium trade-up opportunities sufficient to invest in marketing & operations.
RR Report McDonald’s 2023
While McDonald’s is well positioned for the long-term with solid execution around sound fundamentals, the current macro environment may prompt its core value-oriented customers to demand more deals and concessions than the system is prepared for.
Burger King 1Q23: Employment is the Biggest Driver of Industry Traffic & Sales
While a +1% price increase typically drives a -0.4% traffic loss (60% flow-through), BK’s A&B operators are generating significantly higher flow-through rates, revealing that guests are willing to pay more when provided with a great experience.