Shake Shack Reported RMB 7.1 Billion in 2021 System Sales and Planned Openings in Chengdu, Nanjing and Guangzhou

This is an English adaptation of a FoodBud historical article originally published on February 19, 2022.

Shake Shack reported fourth-quarter and fiscal-year 2021 results for the period ended December 29, 2021. For international operators, the key readout is a recovering sales base, continued losses, a high digital mix, and an expansion plan that included additional licensed stores in China.

Fourth-Quarter Performance

In Q4 2021, Shake Shack generated revenue of $200 million, up 29% year on year. Systemwide sales reached $310 million, up 31.9%, while same-store sales increased 20.8%.

Licensed revenue in the quarter was $7.4 million, up 46.8% year on year.

The company opened 19 net new stores in Q4, including 13 company-operated Shacks and 6 licensed Shacks. Of the licensed openings, 5 were international and 1 was in the United States.

By the end of Q4 2021, Shake Shack operated 218 company-operated stores and 128 licensed stores.

The company reported an operating loss of $6.5 million in Q4, narrower than the $12.2 million operating loss in the same period of 2020. Net loss attributable to the public company was $9.7 million, versus a $19.4 million net loss in the prior-year period. As of December 29, 2021, cash and cash equivalents stood at $380 million.

Digital sales accounted for 42% of Q4 revenue. Average weekly sales per store in the quarter were $74,000.

Full-Year 2021

For fiscal 2021, Shake Shack reported revenue of $740 million, up 41.5% year on year. Systemwide sales were $1.12 billion, up 44.2%; the original article’s headline framed this as about RMB 7.1 billion.

The company reported a full-year operating loss of $15.9 million and a net loss attributable to the public company of $8.7 million.

For the full year, Shake Shack opened 58 net new stores: 35 company-operated stores, after closing 1 company-operated store, and 23 licensed stores, after closing 2 licensed stores.

CEO Randy Garutti said on the earnings call that the intensifying pandemic continued to put pressure on restaurant staffing. After entering 2022, Shake Shack had raised base wages for store employees by more than 13%. Company-operated stores opened in 2021 generated annual sales of $3.9 million per store.

2022 Store Guidance and China Expansion

For 2022, Shake Shack guided for 45 to 50 new company-operated stores.

It also expected to open 20 to 25 licensed stores in 2022, including locations in Nanjing, Chengdu and Guangzhou. In 2021, Shake Shack had already opened stores in Macau, Shenzhen and Hangzhou.

Licensed stores still represented a smaller share of systemwide sales. Across the four quarters of fiscal 2021, licensed stores contributed $77.6 million, $100 million, $110 million and $120 million in systemwide sales, respectively.

Note: 2022 opening plans and guidance figures are historical forward-looking figures from the February 19, 2022 source article.