Wingstop Inc WING shares are trading lower, after initially trading higher on Wednesday following better-than-expected second-quarter FY24 earnings results.
The company reported second-quarter FY24 sales growth of 45.3% year-on-year to $155.7 million, beating the analyst consensus estimate of $144.012 million.
System-wide sales increased 45.2% Y/Y to $1.2 billion, Domestic same-store sales increased 28.7% versus last year, and Digital sales jumped to 68.3% of system-wide sales. Domestic restaurant AUVs increased to $2 million.
Revenue from royalty, franchise fees, and others rose 48.3% Y/Y, Advertising fee revenue increased 49.3%, and company-owned restaurant sales grew 32.3%.
Total costs and expenses expanded 41.8% Y/Y to $114.5 million. The operating margin was 26.5%, and the operating income for the quarter gained 55.8% to $41.2 million.
Adjusted EBITDA of $51.8 million increased 50.7% Y/Y. Adjusted EPS of $0.93 beat the analyst consensus of $0.81.
Wingstop held $108.2 million in cash and equivalents as of June 29. There were 2,352 Wingstop restaurants system-wide, including 2,040 restaurants in the U.S.
The company's board of directors approved a quarterly dividend increase from $0.22 to $0.27 per share, which will be paid on Sept. 6, 2024 to stockholders of record as of Aug. 16, 2024.
As of June 29, 2024, $96.1 million remained available under the share repurchase program previously approved by the Company’s Board of Directors.
"This growth in AUVs has further enhanced our best-in-class unit economics, and as we continue to open new restaurants at a record pace, we believe there is an opportunity to more than triple our current U.S. footprint," said President and CEO Michael Skipworth.
Outlook: Wingstop raised FY24 domestic same-store sales growth outlook to about 20% from the previous low double digits.
The company now expects 285-300 global net new units in FY24 (prior view 275–295). Wingstop reiterated guidance for depreciation and amortization of $18 million – $19 million.
Price Action: WING shares are trading 1.7% lower at $370.13 at the last check Wednesday.
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