LONDON, UK / ACCESSWIRE / March 28, 2018 / Active-Investors.com has just released a free earnings report on Shake Shack Inc. (NYSE: SHAK). If you want access to this report all you need to do is sign up now by clicking the following link www.active-investors.com/registration-sg/?symbol=SHAK. The Company reported its fourth quarter fiscal 2017 operating and financial results on February 15, 2018. The fast-food chain surpassed top- and bottom-line expectations. Additionally, the Company provided guidance for FY18, and also shared targets for FY20. Register today and get access to over 1000 Free Research Reports by joining our site below:
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Earnings Highlights and Summary
For the fourth quarter of the fiscal year 2017, Shake Shack's total revenues jumped 31.2% to $96.1 million from $73.3 million in Q4 2016. The Company's revenue numbers beat analysts' estimates of $92.8 million.
During Q4 2017, Shake Shack's general and administrative (G&A) expenses increased 41% to $11.7 million from $8.3 million in Q4 2016. As a percentage of total revenues, the G&A expenses increased to 12.1% in the reported quarter from 11.3% in the prior year's same quarter, primarily due to higher payroll expenses from an increased headcount; technology development costs; initial costs related to Project Concrete, the Company's operational and financial systems upgrade initiative; and duplicative non-cash deferred rent related to Shake Shack's new home office.
For Q4 2017, Shake Shack's operating income advanced 17.0% to $5.8 million compared to $5.0 million in Q4 2016. The Company's operating income margin decreased 70 basis points to 6.1%. The Company's Shack-level operating profit surged 30.3% to $23.5 million in Q4 2017 from $18.0 million in Q4 2016. As a percentage of Shack sales, Shack-level operating profit margin decreased 20 basis points to 25.2%, primarily due to increased labor and related expenses; other operating expense deleverage; and the introduction of a broader range of unit volume Shacks into the system.
In Q4 2017, Shake Shack's net loss attributable to common shareholders was $14.4 million, or $0.55 loss per diluted share, compared to a net income of $3.9 million, or $0.15 per diluted share, in Q4 2016. From the Tax Cuts and Jobs Act 2017 (TCJA), which was enacted into law in December 2017, the Company recognized a $125.9 million benefit in other income related to the reduction in liabilities under its tax receivable agreement. The Company also recognized an additional $138.6 million of income tax expense as a provisional amount, relating to the remeasurement of its deferred tax assets.
Shake Shack's adjusted pro-forma net income was $3.9 million, or $0.10 per diluted share, in Q4 2017 compared to $3.3 million, or $0.09 per diluted share, in Q4 2016. The Company's earnings beat Wall Street's estimates of $0.06 per share.
For the full year FY17, Shake Shack's total revenues surged 33.6% to $358.8 million compared to $268.5 million in FY16.
For FY17, Shake Shack's net loss attributable to common shareholders was $2.3 million, or $0.09 loss per diluted share, compared to a net income of $12.4 million, or $0.53 per diluted share, in FY16. The Company's adjusted pro-forma net income was $21.0 million, or $0.57 per diluted share, in FY17 compared to $16.8 million, or $0.46 per diluted share, in FY16.
In Q4 2017, the Company's Shack sales advanced 31.3% to $93.1 million compared to $70.9 million in Q4 2016, primarily due to the opening of 26 new domestic Company-operated Shacks. The Company's licensing revenues were $3.0 million in the reported quarter, reflecting an increase of 27.9% from $2.4 million in the prior year's comparable quarter, primarily due to the opening of 19 net new licensed Shacks and the initial strength of newer Shacks in South Korea.
The Company's same-Shack sales increased 0.8% in Q4 2017 versus a growth of 1.5% in Q4 2016. The comparable Shack base includes those restaurants open for 24 full fiscal months or longer. During Q4 2017, the comparable Shack base included 43 Shacks versus 29 Shacks in Q4 2016.
Shake Shack's average weekly sales for domestic Company-operated Shacks were $85,000 in Q4 2017 compared to $90,000 in Q4 2016, reflecting a drop of 5.6%, primarily due to the addition of newer Shacks at lower average unit volumes.
For the full fiscal year ending December 26, 2018, Shake Shack is forecasting total revenues to be in the range of $444 million and $448 million. The Company is expecting same-Shack sales to remain flat, which includes approximately 1.5% to 2% of menu price increases taken in December 2017.
For FY18, Shake Shack is planning to open 32 to 35 new domestic Company-operated Shacks and between 16 and 18 net new licensed Shacks. Shake Shack is estimating average annual sales volume for total domestic Company-operated Shacks to be between $4.1 million and $4.2 million, and Shack-level operating profit margin between 24.5% and 25.5%.
By the end of the fiscal year 2020, Shake Shack is targeting at least 200 domestic Company-operated Shacks, at least 120 global licensed Shacks, and over $700 million in total revenues.
Stock Performance Snapshot
March 27, 2018 - At Tuesday's closing bell, Shake Shack's stock dropped 1.20%, ending the trading session at $41.06.
Volume traded for the day: 468.20 thousand shares.
Stock performance in the last month – up 5.28%; previous six-month period – up 22.17%; and past twelve-month period – up 27.12%
After yesterday's close, Shake Shack's market cap was at $1.50 billion.
Price to Earnings (P/E) ratio was at 86.81.
The stock is part of the Services sector, categorized under the Specialty Eateries industry.
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