Shake Shack Announces Fourth Quarter and Fiscal Year 2021 Financial Results|||

– Total Revenue in 4Q21 and FY21 of $203.3m and $739.9m respectively.

– Record System-broad Sales in 4Q21 and FY21 of $314.3m and $1.1b respectively, representing twelvemonth-on-yr growth of 42.5% and 47.6%, respectively excluding the impact of the 53rd accounting week in 2020.

– Same-Shack sales rose in 4Q21 xx.8% vs 2020 and 2.2% vs 2019.

– 13 New Domestic Company-Operated Shack Openings in 4Q21, highlighted by our beginning drive-thru locations in Minnesota and Missouri.

– 36 New Domestic Visitor-Operated Shacks and 26 New Licensed Shacks in 2021.

NEW YORK–(BUSINESS WIRE)–Shake Shack Inc.
(“Milk shake Shack” or the “Company”) (NYSE: SHAK), today reported financial results for the fourth quarter and the fiscal twelvemonth ended December 29, 2021.

Randy Garutti, Primary Executive Officer of Shake Shack, stated, “As we look dorsum on 2021, nosotros remain incredibly grateful and proud of how our Shack family unit has continued to overcome the many challenges we’ve faced. We are pleased to report a stiff sales improvement in the fourth quarter with record full year system-wide sales results and aforementioned-Shack sales upwards 2.ii% versus 2019. Even so, our sales were impacted past the precipitous increase in Omicron cases in fiscal January, causing a decline in traffic, lost hours and Shack closures. While a return to pre-COVID movement patterns remains uncertain, nosotros are pleased to see improvement through financial February, with aforementioned-Shack sales up approximately 13% calendar month to date.”

Garutti connected, “We remain confident in our strategic investments around Elevating our People, Digital Transformation, Format Evolution with bulldoze-thru, and our commitment to delivering a great guest experience with an centre towards accelerated growth. We believe that Shake Shack is positioned to manage through ongoing headwinds. With our largest development schedule ever and a healthy rest sheet to support continued investments, we believe we volition exit 2022 stronger than where we started and are incredibly excited for this next chapter in the Milk shake Shack story.”

Financial Highlights for the Fourth Quarter 2021:


  • Total revenue

    in the 4th quarter 2021 increased 29.0% to $203.3 million versus the same period last year, showing continued year-on year growth from an increment of 48.7% in the third quarter 2021. This increment is inclusive of the favorable bear upon of the 53rd week in the fourth quarter 2020, which resulted in incremental revenue of $11.ane meg. Excluding the 53rd week, Total revenue in the fourth quarter 2021 increased 38.8%.

  • Shack sales

    in the fourth quarter 2021 increased 28.5% to $195.nine million versus the same catamenia concluding year, compared to an increase of 48.i% in the 3rd quarter 2021. This increase is inclusive of the favorable impact of the 53rd calendar week in the fourth quarter 2020, which resulted in incremental Shack sales of $10.7 million. Excluding the 53rd week, Shack sales in the fourth quarter 2021 increased 38.1%.

  • Same-Shack sales


    (1)

    were upwardly xx.8% in the quaternary quarter 2021 versus the aforementioned flow last year, compared to up 24.viii% in the third quarter 2021. Additionally, Aforementioned-Shack sales were up 2.2% in the fourth quarter 2021 versus the same menses in 2019, an comeback from downward 7.3% in the third quarter 2021.

  • Licensing revenue

    in the quaternary quarter 2021 increased 46.8% to $7.4 million versus the same period terminal year, showing continued year-on yr growth from an increase of 68.3% in the third quarter 2021. This increase is inclusive of the favorable impact of the 53rd calendar week in the fourth quarter 2020, which resulted in incremental licensing revenue of $0.4 million. Excluding the 53rd week, Licensing acquirement in the fourth quarter 2021 increased 61.0%.

  • Shack system-wide sales

    in the 4th quarter 2021 increased 31.nine% to $314.iii million versus the aforementioned catamenia last year, showing continued year-on-twelvemonth growth from up 53.1% in the third quarter 2021. This increment is inclusive of the favorable bear upon of the 53rd week in the fourth quarter 2020, which resulted in incremental Shack arrangement-wide sales of $17.7 million. Excluding the 53rd calendar week, Shack organisation-broad sales in the fourth quarter 2021 increased 42.5%.

  • Operating loss

    in the 4th quarter 2021 was $vi.5 1000000, an improvement compared to operating loss of $12.two million in the same menses last year, but showing a decline when compared to an operating loss of $2.six million in the tertiary quarter 2021, every bit inflationary pressures impacted the business and we keep to invest in General and administrative expenses to back up growth and evolution.


    • Shack-level operating profit(



      two)
      , a non-GAAP mensurate, was $32.2 1000000, or 16.4% of Shack sales in the fourth quarter 2021 versus the same period terminal year, an improvement over a Shack-level operating turn a profit of $29.six 1000000, or 15.8% of Shack sales in the third quarter 2021.

  • Net loss

    was $x.three million in the fourth quarter 2021, compared to net loss of $20.three 1000000 in the same period last year.


    • Adjusted EBITDA(



      two)
      , a not-GAAP measure, was $12.4 one thousand thousand in the 4th quarter 2021, compared to adjusted EBITDA of $9.2 million in the same period concluding year.

  • Net loss owing to Shake Shack Inc.

    was $9.7 million, or a loss of $0.25 per share in the fourth quarter 2021, compared to Net loss owing to Shake Shack Inc. of $19.4 million, or a loss of $0.l per share in the same period final year.


    • Adjusted pro forma net loss(2)
      , a non-GAAP measure, was $4.8 million, or a loss of $0.11 per fully exchanged and diluted share in the fourth quarter 2021, compared to adjusted pro forma net income of $1.three one thousand thousand, or a loss of $0.03 per fully exchanged and diluted share, in the same menstruum terminal year.
  • The Company opened



    19
    internet system-broad Shacks

    in the fourth quarter 2021, comprised of xiii net domestic Company-operated Shacks and half-dozen net licensed Shacks. As of the end of the fourth quarter at that place were 218 Company-operated domestic Shacks and 151 global licensed Shacks compared to 183 and 128, respectively in the prior year.

  • Cash and cash equivalents and Marketable securities

    were $382.4 one thousand thousand as of Dec 29, 2021.
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Financial Highlights for the Fiscal Twelvemonth 2021:


  • Total revenue

    for the fiscal yr 2021 increased 41.5% to $739.nine million versus the prior yr. This increase is inclusive of the favorable impact of the 53rd week in the fourth quarter 2020, which resulted in incremental revenue of $11.one meg. Excluding the 53rd week, total revenue in fiscal year 2021 increased 44.vi%.

  • Shack sales

    for the financial year 2021 increased 41.2% to $715.0 meg versus the prior twelvemonth. This increase is inclusive of the favorable affect of the 53rd week in the fourth quarter 2020, which resulted in incremental Shack sales of $10.7 million. Excluding the 53rd week, Shack sales in fiscal twelvemonth 2021 increased 44.2%.

  • Same-Shack sales(one)


    increased 24.ii%, for the fiscal twelvemonth 2021 versus the prior year.

  • Licensing acquirement

    for the fiscal year 2021 increased l.7% to $24.ix one thousand thousand versus the prior year. This increase is inclusive of the favorable impact of the 53rd calendar week in the fourth quarter 2020, which resulted in incremental licensing revenue of $0.4 million. Excluding the 53rd calendar week, Licensing revenue in fiscal twelvemonth 2021 increased 54.8%.

  • Shack system-broad sales

    increased 44.2% to $1,123.ane one thousand thousand, versus the prior year. This increase is inclusive of the favorable impact of the 53rd week in the fourth quarter 2020, which resulted in incremental Shack system-wide sales of $17.vii million. Excluding the 53rd week, Shack system-wide sales in the financial year 2021 increased 47.6%.

  • Operating loss

    for the fiscal twelvemonth 2021 was $fifteen.ix meg compared to operating loss of $43.nine one thousand thousand in the same menstruation last year.


    • Shack-level operating profit(

      2)
      , a not-GAAP measure, increased 66.9% to $119.two million, or xvi.7% of Shack sales in fiscal year 2021.

  • Internet loss

    was $10.i million in fiscal twelvemonth 2021, compared to net loss of $45.5 million in the same menstruum terminal year.


    • Adjusted EBITDA(2)

      , a not-GAAP measure, was $56.0 one thousand thousand in financial year 2021, compared to adapted EBITDA of $22.seven one thousand thousand in the same menstruum last yr.

  • Internet loss attributable to Shake Shack Inc.
    was $eight.vii million, or a loss of $0.22 per share in financial year 2021, compared to Net loss attributable to Milkshake Shack Inc. of $42.two million, or a loss of $1.xiv per share in the aforementioned menstruum last year.


    • Adjusted pro forma net loss(2)
      , a not-GAAP measure, was $two.6 million, or a loss of $0.06 per fully exchanged and diluted share in fiscal year 2021, compared to adapted pro forma cyberspace loss of $22.3 million, or a loss of $0.56 per fully exchanged and diluted share, in the same period concluding twelvemonth.
  • The Company opened
    58
    net system-wide Shacks
    , comprised of 35 internet domestic Company-operated Shacks, which is cyberspace of ane closure, and 23 cyberspace licensed Shacks, which is internet of three licensed Shack closures.
(1)

In order to compare similar-for-similar periods for fiscal 2021, aforementioned-Shack sales compared the 52 weeks from December 31, 2020 through December 29, 2021 to the 52 weeks from Jan 2, 2020 through December thirty, 2020.

(two)

Shack-level operating profit, adapted EBITDA and adapted pro forma net income (loss) are non-GAAP measures. Reconciliations of Shack-level operating profit to operating income (loss), adjusted EBITDA to cyberspace income (loss), and adjusted pro forma net income (loss) to net income (loss) owing to Shake Shack Inc., the most directly comparable financial measures presented in accordance with GAAP, are prepare forth in the schedules accompanying this release. Meet “Not-GAAP Financial Measures.”

4th Quarter 2021 Review

Total revenue, which includes Shack sales and Licensing acquirement, increased 29.0% from the fourth quarter 2020 to $203.3 one thousand thousand in the fourth quarter 2021. This increment is inclusive of the favorable bear on of the 53rd calendar week in the fourth quarter 2020, which resulted in incremental acquirement of $11.1 million. Excluding the 53rd week, Total revenue in the fourth quarter 2021 increased 38.eight%. This growth was due in role to the opening of 35 net new domestic Company-operated Shacks during the financial twelvemonth 2021, also as continued sales recovery across Shack markets.

Aforementioned-Shack sales grew xx.8% yr-on-year in the quaternary quarter 2021, compared to up 24.viii% in the third quarter 2021. This yr-on-year growth was driven by continued improvement across some of our hardest hit markets such every bit New York City, which saw same-Shack sales up 39% in the 4th quarter 2021. When compared to 2019, we saw growth for the start time in 2021, exiting the quaternary quarter up 2.2%. Both our urban and suburban Shacks saw improvement versus 2019 in the fourth quarter 2021, even with many of our highest book Shacks still down when compared to 2019. Our urban same-Shack sales were downward only four% in the 4th quarter 2021 versus 2019, an improvement from down xv% in the third quarter 2021. Suburban same-Shack sales were upwards 9% in the quaternary quarter 2021 versus 2019. Contributing to this improvement were our mall based Shacks, which benefited from increased vacation shopping.

Average weekly sales were $74,000 in the fourth quarter 2021, up from $72,000 in the third quarter 2021. This comeback was due to increased menu prices and forcefulness across urban markets.

During the 4th quarter 2021, full digital sales, including orders placed on the Milkshake Shack app, website and third-political party delivery platforms, represented 42% of Shack sales. During the fourth quarter 2021 we grew our get-go time app and web purchasers base past more than lxxx% for the full year 2021. Nosotros have been able to retain around eighty% of digital sales in fiscal December 2021 when compared to fiscal Jan 2021 when digital sales peaked. In the 4th quarter 2021, we launched our Black Truffle Burger and Truffle Fries which started every bit an early exclusive on our Company-owned app. These two items were the strongest performing express time offerings of 2021 on our digital channels.

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Licensing revenue for the fourth quarter 2021 was $vii.four million. In the quarter, our domestic Shacks benefited from increased levels of air travel, especially over the vacation period. Internationally, we saw relaxation of COVID restrictions in select markets in addition to five international openings in the fourth quarter 2021. Included in these v international openings is our 2nd Shack in the metropolis of Shenzhen, every bit we continue to expand across the Chinese market. While we saw a do good of the overall global recovery in the quaternary quarter, we sympathize that conditions continue to remain volatile and ever-changing.

During the fourth quarter 2021, the Visitor opened 13 new domestic Company-operated Shacks, five new international licensed Shacks and i new domestic licensed Shack.

Location

Type

Opening Appointment

Lone Tree, CO — Park Meadows

Domestic Company-operated

x/13/21

Rochester, MI — Rochester Hills

Domestic Company-operated

10/18/21

Alabang, Philippines — Alabang Town Middle

International Licensed

10/21/21

Indianapolis, IN — The Fashion Mall at Keystone

Domestic Company-operated

10/28/21

Westgate, Singapore — Westgate Singapore

International Licensed

10/30/21

Sillim, South Korea — Sillim

International Licensed

11/v/21

Encino, CA — Encino Courtyard

Domestic Company-operated

11/13/21

Columbus, OH — Polaris

Domestic Company-operated

11/29/21

Raleigh, NC — PNC Arena

Domestic Licensed

12/one/21

Miami, FL — Dadeland Mall

Domestic Company-operated

12/four/21

Maple Grove, MN — Maple Grove

Domestic Visitor-operated

12/half dozen/21

Indianapolis, IN — Downtown Indianapolis

Domestic Company-operated

12/12/21

Cheonan, Republic of korea — Cheonan

International Licensed

12/13/21

Shenzhen, China — Coco Park Shenzhen

International Licensed

12/fourteen/21

Danbury, CT — Danbury

Domestic Company-operated

12/15/21

Lee’south Summit, MO — Lee’south Superlative

Domestic Company-operated

12/xx/21

Bethesda, Doctor — Westfield Montgomery Mall

Domestic Company-operated

12/xx/21

New York, NY — 630 Lexington Ave (54th & Lex)

Domestic Company-operated

12/27/21

Whitehall, PA — Lehigh Valley Mall

Domestic Company-operated

12/28/21


Operating loss

for the 4th quarter 2021 was $half dozen.v million, resulting in a negative operating loss margin of 3.two% compared to an operating loss of $12.2 meg, or a negative operating loss margin of 7.8% for the quaternary quarter 2020. For the fourth quarter 2021, Shack-level operating profit, a non-GAAP mensurate, was $32.two one thousand thousand, or xvi.4% as a percentage of Shack sales, compared to Shack-level operating profit of $29.6 million, or 15.8% of Shack sales in the third quarter 2021. The year-on-year increment in Shack-level operating profit was primarily due to sales leverage as the business saw less impact from the COVID-19 pandemic, equally well as lower delivery commissions equally a effect of lower digital sales mix. A reconciliation of Shack-level operating profit to Operating loss, the most directly comparable GAAP financial measure, is set forth in the schedules accompanying this release. Run across “Non-GAAP Fiscal Measures.”


  • General and authoritative expenses

    increased 34.0% to $25.6 meg in the fourth quarter 2021 from $19.1 million in the quaternary quarter 2020. Every bit a percent of total acquirement, full general and administrative expenses increased to 12.6% for the fourth quarter 2021 from 12.one% in the fourth quarter 2020. This increase was primarily due to increased investment in our home office teams, marketing and It to support development and digital initiatives, equally the Company continues to invest for accelerated growth ahead.

Fiscal 2022 Outlook

The Company is providing revenue and sales guidance for the fiscal first quarter of 2022.

Current Q1 2022 Outlook

Full acquirement

$196 million to $201.4 million

Shack sales

$190 million to $195 million

Licensing acquirement

$vi one thousand thousand to $half dozen.4 million

Same-Shack sales versus 2021

loftier-single digits to low-double digits %

Shack-level operating turn a profit margin

11% to 14%

Fiscal first quarter and fiscal yr 2022 guidance is derived from recent trends and does not assume material changes to the electric current operating surround, inclusive of whatever potential farther COVID impacts.

Given the substantial doubtfulness and resulting cloth economic impact caused by the COVID-xix pandemic, the Company is non providing total guidance for the financial year catastrophe December 28, 2022. The timing of a return to pre-COVID sales levels is highly dependent upon the return of the high traffic areas that contributed to many of the strongest Shack sales, including those most reliant on travel, schools, offices and major gatherings. The timing of that recovery remains unknown today. Furthermore, there is uncertainty around the cost pressures facing our business organisation due to inflation. As the Company approaches the ii year marking in mid-March 2022 since the initial and extensive touch on of COVID-19, it remains cautious about the near-term sales outlook, especially in its urban business.

Electric current 2022 Outlook

Domestic Visitor-operated Shack openings

45 to 50

Licensed Shack openings

20 to 25

Full full general and administrative expenses(1)

$108 million to $114 one thousand thousand

Equity-based compensation

approximately $13 meg

Depreciation expense

$seventy 1000000 to $75 million

Pre-opening costs

$14 million to $17.5 million

Adjusted Pro-Forma Tax Rate

28%-xxx%

(1) Includes approximately $12 1000000 of the approximately $thirteen million total Equity-based compensation.

Earnings Briefing Call

As previously announced, the Visitor volition host a conference call to discuss its fourth quarter and fiscal year 2021 financial results today at 5:00 p.m. ET.

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The conference call tin be accessed live over the telephone by dialing (877) 407-0792, or for international callers by dialing (201) 689-8263. A replay of the call will be available until February 24, 2022 by dialing (844) 512-2921 or for international callers by dialing (412) 317-6671; the passcode is 13725684.

The live sound webcast of the briefing call will exist accessible in the Events & Presentations section of the Company’due south Investor Relations website at investor.shakeshack.com. An archived replay of the webcast will also be bachelor shortly afterward the live effect has concluded.

Definitions

The following definitions apply to these terms every bit used in this release:

“Shack sales” is defined equally the aggregate sales of food, beverages and Shake Shack branded merchandise at domestic Company-operated Shacks and excludes sales from licensed Shacks.

“Same-Shack sales” represents Shack sales for the comparable Shack base, which is defined equally the number of domestic Company-operated Shacks open for 24 full fiscal months or longer. For days that Shacks were temporarily closed, the comparative 2019 period was also adjusted.

“Boilerplate weekly sales” is calculated by dividing full Shack sales by the number of operating weeks for all Shacks in operation during the period. For Shacks that are not open for the unabridged period, fractional adjustments are made to the number of operating weeks open such that it corresponds to the period of associated sales.

“Weekly licensed sales” is calculated by dividing the total sales for the period for all licensed Shacks by the number of weeks in the menses.

“Shack-level operating profit,” a not-GAAP measure, is defined as Shack sales less Shack-level operating expenses including food and paper costs, labor and related expenses, other operating expenses and occupancy and related expenses.

“Shack-level operating profit margin,” a non-GAAP measure out, is defined as Shack sales less Shack-level operating expenses including food and newspaper costs, labor and related expenses, other operating expenses and occupancy and related expenses equally a pct of Shack sales.

“EBITDA,” a non-GAAP mensurate, is defined equally net income (loss) before involvement expense (net of interest income), income tax expense (benefit), and depreciation and acquittal expense.

“Adapted EBITDA,” a not-GAAP measure, is defined as EBITDA (every bit divers above), excluding equity-based compensation expense, deferred lease costs, impairment and loss on disposal of assets, amortization of cloud-based software implementation costs, equally well as certain non-recurring items that the Company does not believe directly reflect its core operations and may not be indicative of the Company’s recurring business operations.

“Adapted EBITDA margin,” a non-GAAP measure, is defined equally cyberspace income (loss) before net involvement, taxes, depreciation and amortization, which also excludes disinterestedness-based bounty expense, deferred lease costs, impairment and loss on disposal of assets, amortization of cloud-based software implementation costs, besides equally certain non-recurring and other items that the Visitor does not believe straight reflect its core operations, every bit a percentage of revenue.

“Adjusted pro forma net income (loss),” a non-GAAP mensurate, represents internet income (loss) attributable to Milkshake Shack Inc. bold the full exchange of all outstanding SSE Holdings, LLC membership interests (“LLC Interests”) for shares of Course A mutual stock, adjusted for sure not-recurring and other items that the Visitor does not believe directly reflect its core operations.

About Shake Shack

Shake Shack is a modern day “roadside” burger stand up serving a classic American menu of premium burgers, craven sandwiches, hot dogs, cockle cut chips, shakes, frozen custard, beer and wine. With its fresh, simple, high-quality food at a smashing value, Milk shake Shack is a fun and lively customs gathering place with widespread appeal. Milkshake Shack’s mission is to Stand for Something Good®, from its premium ingredients and caring hiring practices to its inspiring designs and deep customs investment. Since the original Shack opened in 2004 in NYC’southward Madison Foursquare Park, the Visitor has expanded to more than than 240 domestic locations in 32 U.S. States and the Commune of Columbia and more than 125 international locations including London, Hong Kong, Shanghai, Singapore, Mexico City, Istanbul, Dubai, Tokyo, Seoul and more.”

Frontward-Looking Statements

This printing release contains forward-looking statements, within the significant of the Private Securities Litigation Reform Human action of 1995 (“PSLRA”), which are bailiwick to known and unknown risks, uncertainties and other important factors that may crusade bodily results to exist materially different from the statements fabricated herein. All statements other than statements of historical fact included in this printing release are forward-looking statements, including, simply not express to, expected financial outlook and operating performance for fiscal 2021, guidance for financial 2022, expected Shack openings, expected same-Shack sales growth and trends in the Company’s operations. Forward-looking statements discuss the Company’south current expectations and projections relating to its financial position, results of operations, plans, objectives, future operation and business organization. Yous can place frontwards-looking statements by the fact that they do not relate strictly to historical or electric current facts. These statements may include words such equally “aim,” “anticipate,” “believe,” “estimate,” “expect,” “forecast,” “outlook,” “potential,” “project,” “projection,” “program,” “intend,” “seek,” “may,” “could,” “would,” “will,” “should,” “can,” “can take,” “probable,” the negatives thereof and other similar expressions. All forrad-looking statements are expressly qualified in their entirety by these cautionary statements. You should evaluate all frontward-looking statements made in this printing release in the context of the risks and uncertainties disclosed in the Company’s Class 10-1000 for the financial year concluded December 30, 2020. All of the Company’due south SEC filings are available online at world wide web.sec.gov, www.shakeshake.com or upon request from Shake Shack Inc.

Contacts

Investor Relations:

Melissa Calandruccio, ICR

Michelle Michalski, ICR

(844) SHACK-04 (844-742-2504)

investor@shakeshack.com

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