Business Update from
After a strong 2019 reflecting continued momentum in sales, margin and bottom line growth,
Since then, with stay at home orders in place throughout much of the country and with mandated closures of dining rooms across the country, our business has been meaningfully disrupted by the current COVID-19 health crisis. We would like to thank the thousands of Noodles team members throughout the country for their continued commitment to our guests and to each other during this unprecedented time.
We are fortunate that as we entered this crisis,
During the past few weeks, we have implemented several new initiatives to adapt our operations to the current environment, as well as to better position the company for the future. Some of the changes that have been implemented include:
- Closing of our dining rooms and execution of enhanced food safety and quality assurance programs throughout the system to protect the health and safety of our team members and guests;
- Launch of curbside pickup in 350 restaurants throughout the system;
- Expansion of delivery options through our own digital channels as well as adding
Uber Eatsas a delivery partner to our existing national delivery presence through Door Dash;
- Introduction of Family Meals to provide a convenient offering that provides choice and value to our guests. Additionally, with each family meal sold, we are donating a meal to a healthcare worker during this time of need.
I would like to thank our incredible guests who have continued to support us during this challenging time.
Sales Update for the First Quarter of 2020
The company delivered strong comparable sales results during the first quarter through the second fiscal week of the third fiscal period ended on
|Comparable Restaurant Sales||4 Weeks
The company has substantively halted capital investment in new unit development as well as other discretionary capital initiatives including its “kitchen of the future” initiative. As a result, capital expenditures for fiscal year 2020 are anticipated to be between
With uncertainty surrounding COVID-19 events, and as a precautionary measure, during the first fiscal quarter of 2020, the company borrowed
Corporate General & Administrative Expense
The company is working with our franchisees to support their financial liquidity during this period of uncertainty. We have granted deferral of certain royalties, IT support, and marketing fees earned from franchisees. The length of time of these deferrals may differ by market. Although cash collection is being deferred, revenue continues to be recognized as sales occur.
Earnings Call Planned for
As announced on
Forward Looking Statements
In addition to historical information, this press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that involve risks and uncertainties such as the impact of the COVID-19 crisis, including operational and financial measures we have taken in response, the number of restaurants we intend to open, projected capital expenditures and estimates of our effective tax rates. In some cases, you can identify forward-looking statements by terms such as “may,” “might,” “will,” “objective,” “intend,” “should,” “could,” “can,” “would,” “expect,” “believe,” “design,” “estimate,” “predict,” “potential,” “plan” or the negative of these terms and similar expressions intended to identify forward-looking statements. These statements reflect our current views with respect to future events and are based on currently available operating, financial and competitive information. Examples of forward-looking statements include all matters that are not historical facts, such as statements regarding our ability to navigate the COVID-19 crisis, projected capital expenditures, the revenue and balance sheet impact of the COVID-19 crisis, estimated costs associated with our closure of underperforming restaurants, the implementation and results of strategic initiatives and our future financial performance. Our actual results may differ materially from those anticipated in these forward-looking statements due to reasons including, but not limited to, the extent, duration and severity of the COVID-19 crisis; governmental and guest response to the COVID-19 crisis; other conditions beyond our control such as weather, natural disasters, disease outbreaks, epidemics or pandemics impacting our customers or food supplies; consumer reaction to industry related public health issues and health pandemics and perceptions of food safety; our ability to achieve and maintain increases in comparable restaurant sales and to successfully execute our business strategy, including new restaurant initiatives and operational strategies to improve the performance of our restaurant portfolio; our ability to maintain compliance with debt covenants and continue to access financing necessary to execute our business strategy; the success of our marketing efforts; our ability to open new restaurants on schedule; current economic conditions; price and availability of commodities; our ability to adequately staff our restaurants; changes in labor costs; consumer confidence and spending patterns; seasonal factors; and weather. For additional information on these and other factors that could affect the Company’s forward-looking statements, see the Company’s risk factors, as they may be amended from time to time, set forth in its filings with the
Source: Noodles & Company