A banner for the Mediterranean restaurant chain Cava is displayed outside of the Recent York Stock Exchange (NYSE) as the corporate goes public on June 15, 2023 in Recent York City.
Spencer Platt | Getty Images
Cava on Tuesday posted a profitable quarter for its first earnings report since its initial public offering in June.
Cava’s stock surged as much as 12% in prolonged trading. Shares have greater than doubled in value since its IPO, fueled largely by its blockbuster public market debut.
The Mediterranean restaurant company has a market value of $5.27 billion, as of Tuesday’s close.
Here’s what the corporate reported for the quarter ended July 9:
- Earnings per share: 21 cents
- Revenue: $172.9 million vs. $163 million
Cava reported second-quarter net income of $6.5 million, or 21 cents per share, swinging from a net lack of $8.2 million, or $6.23 per share, a 12 months earlier.
CNBC doesn’t compare reported earnings per share to Wall Street estimates for an organization’s first report as a public company, as uncertain share counts can skew expectations.
Net sales soared 62% to $172.9 million, fueled by latest restaurant openings. The chain said it opened 16 net latest Cava restaurants through the period, for a complete of 279.
Cava’s same-store sales climbed 18.2% within the quarter. The chain said its traffic grew 10.3%, making it an outlier within the broader restaurant industry, which has seen customer visits shrink in recent months. CFO Tricia Tolivar attributed among the chain’s strong traffic to increased brand awareness after the corporate’s IPO.
Nonetheless, Tolivar also said that same-store sales growth has moderated in recent weeks. More diners have also shifted from delivery orders to picking up their very own warm bowls and salads, suggesting that Cava’s customer base could also be pulling back on their restaurant spending.
Rival Sweetgreen reported an analogous trend. Delivery orders are likely to be pricier due to added fees.
Cava’s menu prices were up nearly 8% compared with the year-ago period, though executives said the restaurant chain has no plans to boost prices further.
Greater than a 3rd of Cava’s quarterly sales got here from digital orders within the quarter.
Waiting for 2023, Cava expects to report same-store sales growth for the total 12 months of between 13% and 15%. CEO Brett Schulman cited broader economic pressures, like rising rates of interest and gas prices, as the first reason for the cautious sales forecast.
The corporate plans to open between 65 to 70 latest locations. It is also forecasting adjusted earnings before interest, taxes, depreciation and amortization of $62 million to $67 million.
