Wingstop Inc. Reports Fiscal Fourth Quarter and Full Year 2024 Financial Results

Record 349 Net New Restaurants and 15.8% Unit Growth in 2024 Delivers 21st Consecutive Year of Same Store Sales Growth with 19.9% in 2024 , /PRNewswire/ -- Wingstop Inc. ("Wingstop" or the "Company") (NASDAQ: WING) today announced financial results for the fiscal fourth quarter and fiscal year ended December 28, 2024. Highlights for the fiscal fourth quarter 2024 compared to the fiscal fourth quarter 2023: System-wide sales increased 27.6% to $1.2 billion 105 net new openings in the fiscal fourth quarter 2024 Domestic restaurant AUV increased to $2.1 million Domestic same store sales increased 10.1% Digital sales increased to 70.3% of system-wide sales Total revenue increased 27.4% to $161.8 million Net income increased 42.2% to $26.8 million, or $0.92 per diluted share Adjusted EBITDA, a non-GAAP measure, increased 44.2% to $56.3 million Highlights for the fiscal year 2024 compared to the fiscal year 2023: System-wide sales increased 36.8% to $4.8 billion 349 net new openings in fiscal year 2024 System-wide restaurant count increased 15.8% to 2,563 worldwide locations Domestic same store sales increased 19.9% Total revenue increased 36.0% to $625.8 million Net income increased 54.9% to $108.7 million, or $3.70 per diluted share Adjusted EBITDA, a non-GAAP measure, increased 44.8% to $212.1 million Adjusted EBITDA is a non-GAAP measure. A reconciliation of adjusted EBITDA to the most directly comparable financial measure presented in accordance with accounting principles generally accepted in the United States ("GAAP") is set forth in the schedule accompanying this release. See "Non-GAAP Financial Measures." "2024 results demonstrated the strength and staying power of our strategies we are executing against, translating into another record year. We reached new highs with domestic AUVs of $2.1 million and opened 349 net new restaurants - a remarkable 15.8% growth rate, demonstrating the strength of our unit economics and confidence in our strategies by our Brand Partners," said Michael Skipworth, President and Chief Executive Officer. "As we enter 2025, we remain confident in the strategies we are executing and the opportunities in front of us as we work towards our goal of becoming a Top 10 Global Restaurant Brand." Key operating metrics for the fiscal fourth quarter 2024 compared to the fiscal fourth quarter 2023: Thirteen Weeks Ended December 28, 2024 December 30, 2023 Number of system-wide restaurants open at end of period 2,563 2,214 Number of domestic franchise restaurants open at end of period 2,154 1,877 Number of international franchise restaurants open at end of period (1) 359 288 System-wide sales (in millions) $ 1,232 $ 966 Domestic AUV (in thousands) $ 2,138 $ 1,827 Domestic same store sales growth 10.1 % 21.2 % Company-owned domestic same store sales growth 3.8 % 10.8 % Net income (in thousands) $ 26,753 $ 18,814 Adjusted EBITDA (in thousands) $ 56,348 $ 39,067 ________________________ (1) Including U.S. territories. Fiscal fourth quarter 2024 financial results Total revenue for the fiscal fourth quarter 2024 increased to $161.8 million from $127.1 million in the prior fiscal fourth quarter. Royalty revenue, franchise fees and other increased $18.0 million, of which $10.9 million was due to net new franchise development, and $4.5 million was due to domestic same store sales growth of 10.1%. Advertising fees increased $12.9 million due to a 27.6% increase in system-wide sales in the fiscal fourth quarter 2024, as well as an increase in the national advertising fund contribution rate to 5.3% from 5.0%, effective the first day of the fiscal second quarter 2024. Company-owned restaurant sales increased $3.8 million due to company-owned restaurants opened and acquired since the prior fiscal fourth quarter, as well as company-owned restaurant same store sales growth of 3.8%, driven primarily by an increase in transactions. Cost of sales was $23.3 million compared to $19.7 million in the prior fiscal fourth quarter. As a percentage of company-owned restaurant sales, cost of sales increased to 77.6% from 75.1% in the prior fiscal fourth quarter. The increase was driven by food, beverage and packaging costs, primarily resulting from an increase in the cost of bone-in chicken wings as compared to the prior fiscal fourth quarter. Our purchases in the prior fiscal fourth quarter were tied primarily to the spot market, which benefited from significant deflation in the cost of bone-in chicken wings. Selling, general & administrative ("SG&A") expense increased $3.2 million to $31.2 million from $28.1 million in the prior fiscal fourth quarter. The increase in SG&A expense was primarily driven by an increase in headcount-related expenses of $3.0 million to support the growth in our business. Depreciation and amortization increased $2.2 million to $5.9 million from $3.6 million in the prior fiscal fourth quarter. The increase in depreciation and amortization was primarily due to software assets placed in service during the fiscal second quarter 2024 that relate to the launch of our proprietary software platform: MyWingstop. Key Operating Metrics for the fiscal year 2024 compared to the fiscal year 2023: Fiscal Year Ended December 28, 2024 December 30, 2023 Number of system-wide restaurants open at end of period 2,563 2,214 Number of domestic franchise restaurants open at end of period 2,154 1,877 Number of international franchise restaurants open at end of period(1) 359 288 System-wide sales (in millions) $ 4,765 $ 3,482 Domestic AUV (in thousands) $ 2,138 $ 1,827 Domestic same store sales growth 19.9 % 18.3 % Company-owned domestic same store sales growth 7.7 % 8.2 % Net income (in thousands) $ 108,717 $ 70,175 Adjusted EBITDA (in thousands) $ 212,061 $ 146,484 ________________________ (1) Including U.S. territories. Fiscal year 2024 financial results Total revenue for fiscal year 2024 increased to $625.8 million from $460.1 million in the prior fiscal year. Royalty revenue, franchise fees and other increased $81.3 million, of which $36.1 million was due to domestic same store sales growth of 19.9%, and $29.9 million was due to net new franchise development since December 30, 2023. Advertising fees increased $60.5 million due to a 36.8% increase in system-wide sales in fiscal year 2024, as well as an increase in the national advertising fund contribution rate to 5.3% from 5.0%, effective the first day of the fiscal second quarter 2024. Company-owned restaurant sales increased $24.0 million, of which $16.0 million was related to company-owned same store sales growth of 7.7%, driven by an increase in transactions, and $8.0 million was primarily related to company-owned restaurants opened and acquired during fiscal year 2024. Cost of sales was $91.6 million compared to $70.6 million in the prior fiscal year. As a percentage of company-owned restaurant sales, cost of sales increased to 76.5% from 73.7% in the prior fiscal year. The increase was driven primarily by food, beverage and packaging costs, primarily resulting from an increase in the cost of bone-in chicken wings as compared to the prior fiscal year. As showcased in the Company's supply chain strategy during 2024, the majority of bone-in wing purchases were no longer tied to the weekly wing spot market, which created predictability for food, beverage and packaging costs. SG&A increased to $116.8 million from $96.9 million in the prior fiscal year. The increase in SG&A expense was driven by an increase in headcount-related expenses of $10.2 million to support the growth in our business, an increase in performance-based stock compensation and incentive compensation expense of $7.6 million related primarily to the Company's performance, and an increase in professional and consulting fees of $1.2 million associated with the Company's strategic initiatives, including system implementation costs. Depreciation and amortization increased $6.3 million to $19.5 million from $13.2 million in the prior fiscal year. The increase in depreciation and amortization was primarily due to software assets placed in service during the fiscal second quarter 2024 that relate to the launch of our proprietary technology platform: MyWingstop. Financial Outlook The Company expects the following for fiscal year 2025: Low- to mid-single digit domestic same store sales growth; Global unit growth rate of 14% to 15%; SG&A of approximately $140 million, which includes system implementation costs of approximately $4.5 million; Stock-based compensation expense of approximately $26 million; Interest expense, net of approximately $46 million; and Depreciation and amortization of between $29 - $30 million. Restaurant Development As of December 28, 2024, there were 2,563 Wingstop restaurants system-wide. This included 2,204 restaurants in the United States, of which 2,154 were franchised restaurants and 50 were company-owned, and 359 franchised restaurants were in international markets and U.S. territories. During the fiscal fourth quarter 2024, there were 105 net system-wide Wingstop restaurant openings. Quarterly Dividend In recognition of the Company's strong cash flow generation and our commitment to returning value to stockholders, on February 18, 2025, our board of directors authorized and declared a quarterly dividend of $0.27 per share of common stock, resulting in a total dividend of approximately $7.7 million. This dividend will be paid on March 28, 2025 to stockholders of record as of March 7, 2025. Share Repurchases As previously announced, during the fiscal fourth quarter of 2024, our board of directors authorized the purchase of up to an additional $500.0 million of our outstanding shares of common stock under our existing share repurchase program. Pursuant to that program, on December 9, 2024, the Company also entered into an accelerated share repurchase agreement (the "ASR Agreement") to repurchase $250.0 million of its common stock. During the fiscal fourth quarter of 2024, the Company made an initial payment of $250.0 million and received and retired 551,325 shares of its common stock under the ASR Agreement, representing an estimated 75% of the total shares expected to be delivered under the ASR Agreement, based on the closing price on the date of initial delivery of $328.54. The delivery of any remaining shares will occur at the final settlement of the transactions under the ASR Agreement, which is scheduled to occur in the fiscal first quarter of 2025. As of December 28, 2024, $311.1 million remained available under the share repurchase program. Since the inception of the Company's share repurchase program in August 2023, the Company has repurchased and retired 1,366,756 shares of its common stock at an average price of $272.89 per share. The following definitions apply to these terms as used in this release: Domestic average unit volume ("AUV") consists of the average annual sales of all restaurants that have been open for a trailing 52-week period or longer. This measure is calculated by dividing sales during the applicable period for all restaurants being measured by the number of restaurants being measured. Domestic AUV includes revenue from both company-owned and franchised restaurants. Domestic AUV allows management to assess our domestic company-owned and franchised restaurant economics. Changes in domestic AUV are primarily driven by increases in same store sales and are also influenced by opening new restaurants. Domestic same store sales reflects the change in year-over-year sales for the same store restaurant base. We define the same store restaurant base to include those restaurants open for at least 52 full weeks. This measure highlights the performance of existing restaurants, while excluding the impact of new restaurant openings and permanent closures. We review same store sales for domestic company-owned restaurants as well as system-wide domestic restaurants. Domestic same store sales growth is driven by increases in transactions and average transaction size. Transaction size increases are driven by price increases or favorable mix shift from either an increase in items purchased or shifts into higher priced items. System-wide sales represents net sales for all of our company-owned and franchised restaurants, as reported by franchisees. This measure allows management to better assess changes in our royalty revenue, our overall store performance, the health of our brand and the strength of our market position relative to competitors. Our system-wide sales growth is driven by new restaurant openings as well as increases in same store sales. Adjusted EBITDA is defined as net income before interest expense, net, income tax expense (benefit), and depreciation and amortization (EBITDA), further adjusted for losses on debt extinguishment and financing transactions, transaction costs, costs and fees associated with investments in our strategic initiatives, system implementation costs, and stock-based compensation expense. We caution investors that amounts presented in accordance with our definitions above may not be comparable to similar measures disclosed by our competitors because not all companies and analysts calculate certain non-GAAP measurements in the same manner. Conference Call and Webcast The Company will host a conference call today to discuss the fiscal fourth quarter 2024 financial results at 10:00 AM Eastern Time. The conference call can be joined telephonically by dialing 1-877-259-5243 or 1-412-317-5176 (international) and asking for the Wingstop conference call. A replay will be available two hours after the call and can be accessed by dialing 1-877-344-7529 or 1-412-317-0088 (international), then entering the replay code 4605313. The replay will be available through Wednesday, February 26, 2025. The conference call will also be webcast live and later archived on the investor relations section of Wingstop's corporate website at ir.wingstop.com under the 'News & Events' section. About Wingstop Founded in 1994 and headquartered in Dallas, TX, Wingstop Inc. (NASDAQ: WING) operates and franchises more than 2,550 locations worldwide. The Wing Experts are dedicated to Serving the World Flavor through an unparalleled guest experience and a best-in-class technology platform, all while offering classic and boneless wings, tenders, and chicken sandwiches, cooked to order and hand sauced-and-tossed in fans' choice of 12 bold, distinctive flavors. Wingstop's menu also features signature sides including fresh-cut, seasoned fries and freshly-made ranch and bleu cheese dips. In fiscal year 2024, Wingstop's system-wide sales increased 36.8% to approximately $4.8 billion, marking the 21st consecutive year of same store sales growth. With a vision of becoming a Top 10 Global Restaurant Brand, Wingstop's system is comprised of corporate-owned restaurants and independent franchisees, or brand partners, who account for approximately 98% of Wingstop's total restaurant count. A key to this business success and consumer fandom stems from The Wingstop Way, which includes a core value system of being Authentic, Entrepreneurial, Service-minded, and Fun. The Wingstop Way extends to the brand's environmental, social and governance platform as Wingstop seeks to provide value to all guests. In 2024, Wingstop secured a place on Ad Age's 'Hottest Brands' list. The Company also earned a spot as one of QSR Magazine's "Best Brands to Work For" and ranked #14 on Entrepreneur Magazine's 'Franchise 500' as one of the fastest-growing franchises. In 2023, Wingstop earned its "Best Places to Work" certification. For more information, visit www.wingstop.com or www.wingstop.com/own-a-wingstop and follow @Wingstop on X, Instagram, Facebook, and TikTok. Learn more about Wingstop's involvement in its local communities at www.wingstopcharities.org. Unless specifically noted otherwise, references to our website addresses, the website addresses of third parties or other references to online content in this press release do not constitute incorporation by reference of the information contained on such website and should not be considered part of this release. Non-GAAP Financial Measures To supplement our consolidated financial statements, which are prepared and presented in accordance with GAAP, we use non-GAAP financial measures, including those indicated above. By providing non-GAAP financial measures, together with a reconciliation to the most comparable GAAP measure, we believe we are enhancing investors' understanding of our business and our results of operations, as well as assisting investors in evaluating how well we are executing our strategic initiatives. These measures are not intended to be considered in isolation or as substitutes for, or superior to, financial measures prepared and presented in accordance with GAAP. The non-GAAP measures used in this press release may be different from the measures used by other companies. A reconciliation of each measure to the most directly comparable GAAP measure is available in this news release. In addition, the Current Report on Form 8-K furnished to the Securities and Exchange Commission (the "SEC") concurrent with the issuance of this press release includes a more detailed description of each of these non-GAAP financial measures, together with a discussion of the usefulness and purpose of such measures. Forward-looking Statements This news release includes statements of our expectations, intentions, plans and beliefs that constitute "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and are intended to come within the safe harbor protection provided by those sections. These statements, which involve risks and uncertainties, relate to the discussion of our business strategies and our expectations concerning future operations, margins, profitability, trends, liquidity and capital resources and to analyses and other information that are based on forecasts of future results and estimates of amounts not yet determinable. These forward-looking statements can generally be identified by the use of forward-looking terminology, including the terms "may," "will," "should," "expect," "intend," "plan," "outlook," "guidance," "anticipate," "believe," "think," "estimate," "seek," "predict," "can," "could," "project," "potential" or, in each case, their negative or other variations or comparable terminology, although not all forward-looking statements are accompanied by such terms. Examples of forward-looking statements in this news release include, but are not limited to, our 2025 fiscal year outlook for domestic same store sales growth, global net new units, SG&A expense, stock-based compensation expense, interest expense, net and depreciation and amortization. These forward-looking statements are made based on expectations and beliefs concerning future events affecting us and are subject to uncertainties, risks, and factors relating to our operations and business environments, all of which are difficult to predict and many of which are beyond our control, that could cause our actual results to differ materially from those matters expressed or implied by these forward-looking statements. Please refer to the risk factors discussed in our Annual Report on Form 10-K and Quarterly Reports on Form 10-Q, which can be found at the SEC's website www.sec.gov. The discussion of these risks is specifically incorporated by reference into this news release. When considering forward-looking statements in this news release or that we make in other reports or statements, you should keep in mind the cautionary statements in this news release and future reports we file with the SEC. New risks and uncertainties arise from time to time, and we cannot predict when they may arise or how they may affect us. Any forward-looking statement in this news release speaks only as of the date on which it was made. Except as required by law, we assume no obligation to update or revise any forward-looking statements for any reason, or to update the reasons actual results could differ materially from those anticipated in any forward-looking statements, even if new information becomes available in the future. Media ContactBrandon Boone[email protected] Investor ContactKristen Thomas[email protected] WINGSTOP INC. AND SUBSIDIARIES Consolidated Balance Sheets (amounts in thousands, except share and per share data) December 28,2024 December 30,2023 Assets Current assets Cash and cash equivalents $ 315,910 $ 90,216 Restricted cash 20,868 11,444 Accounts receivable, net 19,661 12,408 Prepaid expenses and other current assets 6,520 4,948 Advertising fund assets, restricted 32,659 25,328 Total current assets 395,618 144,344 Property and equipment, net 125,953 91,292 Operating lease assets 49,046 19,092 Goodwill 74,718 67,708 Trademarks 32,700 32,700 Customer relationships, net 6,476 7,740 Other non-current assets 31,735 14,949 Total assets $ 716,246 $ 377,825 Liabilities and stockholders' deficit Current liabilities Accounts payable $ 6,943 $ 4,725 Current portion of operating lease liabilities 1,059 2,380 Other current liabilities 46,782 38,571 Advertising fund liabilities 32,659 25,328 Total current liabilities 87,443 71,004 Long-term debt, net 1,206,201 712,327 Operating lease liabilities 58,169 17,807 Deferred revenues, net of current 38,877 30,145 Deferred income tax liabilities, net 1,085 3,721 Other non-current liabilities 57 187 Total liabilities 1,391,832 835,191 Commitments and contingencies Stockholders' deficit Common stock, $0.01 par value; 100,000,000 shares authorized; 28,662,614 and 29,337,920 shares issued and outstanding as of December 28, 2024 and December 30, 2023, respectively 287 293 Additional paid-in-capital 1,568 2,676 Retained deficit (676,940) (459,994) Accumulated other comprehensive loss (501) (341) Total stockholders' deficit (675,586) (457,366) Total liabilities and stockholders' deficit $ 716,246 $ 377,825 WINGSTOP INC. AND SUBSIDIARIES Consolidated Statements of Operations (amounts in thousands, except per share data) Thirteen Weeks Ended Fiscal Year Ended December 28,2024 December 30,2023 December 28,2024 December 30,2023 (Unaudited) (Unaudited) Revenue: Royalty revenue, franchise fees and other $ 75,702 $ 57,705 $ 288,354 $ 207,077 Advertising fees 56,063 43,128 217,630 157,138 Company-owned restaurant sales 30,056 26,224 119,823 95,840 Total revenue 161,821 127,057 625,807 460,055 Costs and expenses: Cost of sales (1) 23,321 19,687 91,632 70,646 Advertising expenses 60,601 45,830 233,306 166,583 Selling, general and administrative 31,232 28,078 116,801 96,898 Depreciation and amortization 5,865 3,648 19,490 13,239 (Gain) loss on disposal of assets (1,038) — (1,038) 95 Total costs and expenses 119,981 97,243 460,191 347,461 Operating income 41,840 29,814 165,616 112,594 Interest expense, net 6,418 4,890 21,292 18,227 Other (income) expense (1,292) (66) (2,866) 57 Income before income tax expense 36,714 24,990 147,190 94,310 Income tax expense 9,961 6,176 38,473 24,135 Net income $ 26,753 $ 18,814 $ 108,717 $ 70,175 Earnings per share Basic $ 0.92 $ 0.64 $ 3.72 $ 2.36 Diluted $ 0.92 $ 0.64 $ 3.70 $ 2.35 Weighted average shares outstanding Basic 29,091 29,407 29,262 29,769 Diluted 29,210 29,508 29,384 29,856 Dividends per share $ 0.27 $ 0.22 $ 0.98 $ 0.82 ________________________ (1) Cost of sales includes all operating expenses of company-owned restaurants, including advertising expenses, but excludes depreciation and amortization, which are presented separately. WINGSTOP INC. AND SUBSIDIARIES Unaudited Supplemental Information Cost of Sales Margin Analysis (amounts in thousands) Thirteen Weeks Ended December 28, 2024 December 30, 2023 In dollars As a % of company-owned restaurant sales In dollars As a % of company-owned restaurant sales Cost of sales: Food, beverage and packaging costs $ 11,184 37.2 % $ 9,037 34.5 % Labor costs 7,299 24.3 % 6,279 23.9 % Other restaurant operating expenses 5,589 18.6 % 5,035 19.2 % Vendor rebates (751) (2.5) % (664) (2.5) % Total cost of sales $ 23,321 77.6 % $ 19,687 75.1 % Fiscal Year Ended December 28, 2024 December 30, 2023 In dollars As a % of company-owned restaurant sales In dollars As a % of company-owned restaurant sales Cost of sales: Food, beverage and packaging costs $ 43,371 36.2 % $ 31,697 33.1 % Labor costs 28,317 23.6 % 22,963 24.0 % Other restaurant operating expenses 23,025 19.2 % 18,314 19.1 % Vendor rebates (3,081) (2.6) % (2,328) (2.4) % Total cost of sales $ 91,632 76.5 % $ 70,646 73.7 % WINGSTOP INC. AND SUBSIDIARIES Unaudited Supplemental Information Restaurant Count Thirteen Weeks Ended Fiscal Year Ended December 28,2024 December 30,2023 December 28,2024 December 30,2023 Domestic Franchised Activity Beginning of period 2,064 1,791 1,877 1,678 Openings 83 86 274 202 Closures — — — (1) Acquired by Company — (1) (4) (3) Re-franchised by Company 7 1 7 1 Restaurants end of period 2,154 1,877 2,154 1,877 Domestic Company-Owned Activity Beginning of period 56 46 49 43 Openings 1 3 4 4 Closures — — — — Acquired by Company — 1 4 3 Re-franchised to franchisees (7) (1) (7) (1) Restaurants end of period 50 49 50 49 Total Domestic Restaurants 2,204 1,926 2,204 1,926 International Franchised Activity(1) Beginning of period 338 262 288 238 Openings 22 29 77 59 Closures (1) (3) (6) (9) Restaurants end of period 359 288 359 288 Total System-wide Restaurants 2,563 2,214 2,563 2,214 ________________________ (1) Includes U.S. territories. WINGSTOP INC. AND SUBSIDIARIES Non-GAAP Financial Measures - EBITDA and Adjusted EBITDA (Unaudited) (amounts in thousands) Thirteen Weeks Ended Fiscal Year Ended December 28,2024 December 30,2023 December 28,2024 December 30,2023 Net income $ 26,753 $ 18,814 $ 108,717 $ 70,175 Interest expense, net 6,418 4,890 21,292 18,227 Income tax expense 9,961 6,176 38,473 24,135 Depreciation and amortization 5,865 3,648 19,490 13,239 EBITDA $ 48,997 $ 33,528 $ 187,972 $ 125,776 Additional adjustments: Transaction costs (a) 316 — 316 — Consulting fees (b) — — — 5,150 System implementation costs (c) 986 — 1,713 — Stock-based compensation expense (d) 6,049 5,539 22,060 15,558 Adjusted EBITDA $ 56,348 $ 39,067 $ 212,061 $ 146,484 ________________________ (a) Represents costs and expenses related to our 2024 securitized financing facility; all transaction costs are included in Selling, general and administrative on the Consolidated Statements of Comprehensive Income. (b) Represents non-recurring consulting fees that are not part of our ongoing operations and are incurred to execute discrete, project-based strategic initiatives, which are included in Selling, general and administrative on the Consolidated Statements of Operations. The costs incurred in the thirteen weeks ended December 30, 2023 include consulting fees relating to a comprehensive review of our long-term growth strategy for our domestic business to explore potential future initiatives, which review was completed in fiscal year 2023. Given the magnitude and scope of this strategic review that is not expected to recur in the foreseeable future, the Company considers the incremental consulting fees incurred with respect to the initiative not reflective of the ongoing costs to operate its business. (c) System implementation costs represent non-recurring expenses incurred related to the development and implementation of new enterprise resource planning and human capital management technology, which are included in Selling, general and administrative on the Consolidated Statements of Operations. (d) Includes non-cash, stock-based compensation, net of forfeitures. SOURCE Wingstop Restaurants Inc. WANT YOUR COMPANY'S NEWS FEATURED ON PRNEWSWIRE.COM? 440k+ Newsrooms & Influencers 9k+ Digital Media Outlets 270k+ Journalists Opted In

Wingstop Inc. Reports Fiscal Fourth Quarter and Full Year 2024 Financial Results

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