In This Article:
A month has gone by since the last earnings report for Jack In The Box (JACK). Shares have lost about 19% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Jack In The Box due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
Jack in the Box Q4 Earnings Top Estimates, Revenues Lag
Jack in the Box reported mixed fourth-quarter fiscal 2024 results, with earnings beating the Zacks Consensus Estimate and revenues missing the same. The top line also declined year over year.
JACK’s Earnings & Revenues Details
In the fiscal fourth quarter, operating earnings per share (EPS) was $1.16, beating the Zacks Consensus Estimate of $1.11. The metric rose 5.5% from $1.10 per share reported in the prior-year quarter.
Quarterly revenues of $349.3 million missed the consensus mark of $358 million. The top line declined 6.2% on a year-over-year basis.
Franchise rental revenues increased 1.5% year over year to $87.3 million. Franchise royalties and other revenues decreased 1.3% year over year to $54.5 million.
Franchise contributions to advertising and other services revenues rose 0.5% year over year to $56.1 million. Company restaurant sales in the quarter was $151.4 million compared with $175 million reported in the prior-year quarter.
JACK’s Comps Discussion
In the quarter under review, company-owned same-store sales declined 2.2% year over year against 4.4% growth reported in the prior-year quarter.
Same-store sales at franchised stores declined 2% year over year against 3.8% growth reported in the prior-year quarter.
Systemwide same-store sales fell 2.1% year over year against 3.9% growth reported in the year-ago quarter. Reduced transactions and an unfavorable mix shift caused this downside.
Del Taco Performance
In fourth-quarter fiscal 2024, company-owned same-store sales moved down 3% year over year, comprising the decline in franchise same-store and system-operated same-store sales of 4.2% and 3.9%, respectively.
Operating Highlights of JACK’s
In the fiscal fourth quarter, the total restaurant-level adjusted margin was 15.1% compared with 18% reported in the prior-year quarter. The decline was attributed to reduced transactions and rising costs from inflation, including higher wages, commodity prices and utility expenses, partially offset by menu price increases.
Food and packaging costs (as a percentage of company restaurant sales) fell 80 basis points (bps) year over year to 28.4%.
The total franchise level margin was 38.9% in the fiscal fourth quarter compared with 39.2% reported in the prior-year quarter.
In the quarter under review, selling, general and administrative expenses accounted for 8.6% of total revenues compared with 11.7% in the prior-year quarter.