Strong 4Q15 System-Wide Comparable Restaurant Sales of +5.8%
Company Provides Initial 2016 Outlook
LAKE FOREST, Calif.--(BUSINESS WIRE)--
Del Taco Restaurants, Inc. (“Del Taco” or the “Company”), (NASDAQ: TACO,
TACOW), the second largest Mexican-American QSR chain by units in the
United States, operating restaurants under the name Del Taco, today
announced preliminary unaudited fiscal fourth quarter 2015 sales results
ahead of its presentation tomorrow at the ICR Conference. Del Taco also
provided updated guidance for fiscal year 2015 as well as initial
guidance for fiscal year 2016.
Fiscal Fourth Quarter 2015 Highlights
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System-wide comparable restaurant sales growth of approximately 5.8%
and company-owned comparable restaurant sales growth of approximately
5.9%, marking the ninth and fourteenth consecutive quarter of gains,
respectively;
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Company-owned comparable restaurant sales growth comprises check
growth of 6.0%, including over 2% of menu mix growth, and
approximately flat transactions at (0.1%);
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Total revenue of approximately $133.4 million, representing 6.1%
growth from the fiscal fourth quarter of 2014;
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Restaurant sales of approximately $128.1 million, representing 6.0%
growth from the fiscal fourth quarter of 2014; and
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Based on updated 2015 guidance, Adjusted EBITDA guidance (a non-GAAP
financial measure) for the fiscal fourth quarter 2015 of at least
$21.0 million, representing at least 7% growth from the previous
year’s fiscal fourth quarter.
The expected sales results are preliminary and unaudited, have not been
reviewed by our independent registered public accountants, and remain
subject to the completion of normal quarter-end accounting procedures
and adjustments and are subject to change. The Company expects to
release financial and operating results for its fiscal fourth quarter
and fiscal year ended December 29, 2015 during March 2016.
Paul J.B. Murphy, III, President and Chief Executive Officer of Del
Taco, commented, “2015 was an incredibly successful year at Del Taco and
we are pleased to have delivered preliminary sales results that we
believe will rank among the best in our industry. We continue to elevate
and solidify our QSR+ positioning through solid execution and product
innovation across our tiered menu strategy including items such as our
fresh avocados, handcrafted ensaladas, and freshly grilled carne asada
steak. This helped drive another quarter of impressive menu mix
improvement, contributing over 2% to our check growth. Our fourth
quarter performance also marked our ninth and fourteenth consecutive
quarters of comparable restaurant sales growth system-wide and for
company-owned restaurants, respectively. We thank all of our team
members for their dedication and contributions to these outstanding
results and look forward to 2016.”
Updated Fiscal 2015 Guidance
Based upon these preliminary unaudited sales results, Del Taco is
offering the following updated guidance for fiscal year 2015, a 52 week
period ending December 29, 2015.
-
System-wide same store sales growth of approximately 6.3%, including
6.4% for company-owned restaurants and 6.2% for franchise restaurants;
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Total revenue of approximately $424.0 million;
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Total company restaurant sales of approximately $407.6 million;
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Restaurant contribution margin of at least 19.7% (representing the
high end of the previously guided range);
-
G&A expenses between approximately $32.3 and $32.5 million, including
non-cash stock-based compensation of approximately $2.1 million;
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Adjusted EBITDA of at least $64.8 million (representing the high end
of the previously guided range); and
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Twelve system-wide restaurant openings, including six company-owned
restaurants.
Del Taco opened three company-owned and six franchise restaurants during
the fiscal fourth quarter, resulting in twelve system-wide openings
during fiscal year 2015. One company-owned restaurant previously
expected to open last year was delayed due to significant rains in
Georgia and opened on January 6, 2016. Additionally, Del Taco closed
twelve previously discussed underperforming company-owned restaurants
late in the fiscal fourth quarter.
The updated 2015 guidance is based on preliminary sales results, is
unaudited, has not been reviewed by our independent registered public
accountants, and remains subject to change in connection with the
preparation of the audited financial statements for the year ended
December 29, 2015.
Initial Fiscal 2016 Guidance
The Company is providing the following initial guidance for fiscal year
2016, a 53-week period ending January 3, 2017.
-
System-wide same store sales growth of approximately 2.5% to 4.5%;
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Total revenue between $439 million and $449 million;
-
Total company-owned restaurant sales between $422 million and $432
million;
-
New California minimum wage impact estimated to increase labor and
related expenses by approximately $7.2 million, including preservation
of appropriate wage differentials and incremental payroll taxes;
-
Adjusted EBITDA between $67.5 million and $70.0 million;
-
Fifteen to eighteen new system-wide restaurant openings, including the
company-owned restaurant that opened in early January 2016; and
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Net capital expenditures totaling approximately $36.0 to $41.0 million
including approximately $10.0 to $12.5 million for new unit
construction, approximately $10.0 to $11.0 million for capitalized
maintenance, approximately $10.0 to $11.5 million for discretionary
investment in equipment and technology, and approximately $6.0 million
for land acquisition for development after 2016.
The fiscal 2016 guidance is based on preliminary fiscal 2015 sales
results and remains subject to change.
ICR Conference Participation
The Del Taco management team will present at the ICR Conference on
Tuesday, January 12, 2016 at the Grande Lakes Hotel and Resort in
Orlando, Florida. The presentation will begin at 8:30 AM Eastern Time
and will be webcast live and later archived. The presentation will be
posted to the Del Taco website at investor.deltaco.com under the “News &
Events” tab on Tuesday, January 12, 2016 before the presentation begins.
Key Financial Definitions
Comparable restaurant sales growth reflects the change in
year-over-year sales for the comparable company, franchise and total
system restaurant base. Restaurants are included in the comparable store
base in the accounting period following its 18th full month
of operations and excludes restaurant closures.
Restaurant contribution is defined as company restaurant sales
less restaurant operating expenses, which are food and paper costs,
labor and related expenses and occupancy and other operating expenses. Restaurant
contribution margin is defined as restaurant contribution as a
percentage of company restaurant sales. Restaurant contribution and
restaurant contribution margin are neither required by, nor
presented in accordance with, GAAP.
Adjusted EBITDA is defined as net income/loss prior to interest
expense, income taxes, and depreciation and amortization, as adjusted to
add back certain charges, such as stock-based compensation expense and
transaction-related costs, as these expenses are not considered an
indicator of ongoing company performance. Adjusted EBITDA is a
non-GAAP financial measure and should not be considered as an
alternative to operating income or net income/loss as a measure of
operating performance or cash flows or as measures of liquidity.
Non-GAAP financial measures are not necessarily calculated the same way
by different companies and should not be considered a substitute for or
superior to GAAP results. Adjusted EBITDA is a financial measure
that was not calculated in accordance with GAAP.
About Del Taco Restaurants, Inc.
At Del Taco (NASDAQ: TACO, TACOW), all menu items taste better because
they are made to order with fresh ingredients including cheddar cheese
grated from 40-pound blocks, handmade pico de gallo salsa, lard-free
beans slow-cooked from scratch, fresh sliced avocado and marinated
chicken grilled in the restaurant. The menu, which includes a full line
of breakfast, includes classic Mexican dishes such as tacos, burritos,
quesadillas and nachos as well as American favorites including
hamburgers, crinkle-cut fries and shakes. Del Taco's UnFreshing
Believable campaign communicates the lengths the company goes to in
order to deliver quality, made-to-order menu items created with
freshly-prepared ingredients at unbelievable prices. With nearly 550
restaurants in 16 states, Del Taco serves more than three million guests
each week. Guests are invited to "like" Del Taco on Facebook at www.facebook.com/deltaco
and join its Raving Fan eClub at www.DelTaco.com/RavingFan.
For more information, please visit www.deltaco.com.
Forward-Looking Statements
In addition to historical information, this release may contain a number
of “forward-looking statements” as defined in the Private Securities
Litigation Reform Act of 1995. Forward-looking statements include,
without limitation, information concerning Del Taco’s possible or
assumed future results of operations, business strategies, competitive
position, industry environment, potential growth opportunities and the
effects of regulation. These statements are based Del Taco’s
management’s current expectations and beliefs, as well as a number of
assumptions concerning future events. When used in this press release,
the words “estimates,” “projected,” “expects,” “anticipates,”
“forecasts,” “plans,” “intends,” “believes,” “seeks,” “may,” “will,”
“should,” “future,” “propose,” “preliminary,” “guidance” and variations
of these words or similar expressions (or the negative versions of such
words or expressions) are intended to identify forward-looking
statements. Such forward-looking statements are subject to known and
unknown risks, uncertainties, assumptions and other important factors,
many of which are outside Del Taco’s management’s control that could
cause actual results to differ materially from the results discussed in
the forward-looking statements. These risks included, without
limitation, consumer demand, our inability to successfully open
company-owned or franchised restaurants or establish new markets,
competition in our markets, our inability to grow and manage growth
profitably, adverse changes in food and supply costs, our inability to
access additional capital, changes in applicable laws or regulations,
food safety and foodborne illness concerns, our inability to manage
existing and to obtain additional franchisees, our inability to attract
and retain qualified personnel, our inability to profitably expand into
new markets, and the possibility that we may be adversely affected by
other economic, business, and/or competitive factors. Additional risks
and uncertainties are identified and discussed in Del Taco’s reports
filed with the SEC and available at the SEC’s website at www.sec.gov
and the Company’s website at www.deltaco.com.
Forward-looking statements included in this release speak only as of the
date of this release. Del Taco undertakes no obligation to update its
forward-looking statements to reflect events or circumstances after the
date of this release or otherwise.

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Source: Del Taco Restaurants, Inc.