This is an English adaptation of a FoodBud historical article originally published on May 14, 2022.
FoodBud previously reviewed first-quarter operating data from a group of North American restaurant chains. This article looks at another eight operators, from coffee and doughnuts to casual dining, breakfast, steakhouse and brewpub concepts.
As of March 31, Dutch Bros had 572 shops: 310 company-operated and 262 franchised. The average franchisee operated 2.8 shops. During the first quarter, the company opened 34 company-operated shops and acquired five franchised shops from franchisees, converting them to company-operated units.
Dutch Bros reported average unit volume of $1.892 million, versus $1.6 million in 2019. Company-operated shops averaged $1.829 million in annual sales. Same-store sales rose 6% year over year in Q1, while company-operated same-store sales rose 5.1%.
Systemwide sales reached $250 million, up 33.7%. For the three months ended March 31, Blue Rebel energy-drink products accounted for 24% of systemwide sales. Revenue was $150 million, up 55%; company-operated shop revenue was $130 million, while franchise and other revenue was $21.969 million. Net loss attributable to the public company was $4.947 million.
For company-operated shops, food and ingredient costs were 27.4% of sales, labor was 32.1%, and rent plus other expenses were 17.7%.
As of March 31, Dutch Bros had 3.7 million registered users, two-thirds of whom had been active in the prior 90 days. The company added more than 250,000 active members in Q1, reaching an average of 4,000 active members per shop. Members’ average ticket was 6.5% higher than non-members’.
Black Rifle Coffee generated Q1 revenue of $65.836 million, up 35% year over year, with gross margin of 35.3%. Operating loss was $15.84 million, and net loss attributable to the public company was $260 million.
DTC revenue was $38.332 million. Wholesale revenue was $21.955 million, up 135%, mainly driven by rapid growth in ready-to-drink products. By the end of Q1, ready-to-drink products were sold in more than 47,000 retail locations. The company’s Walmart partnership was set to expand from 400 pilot stores to more than 3,500 stores.
Retail-store revenue was $5.549 million, up 397%. The company had nine company-operated Outposts and nine franchised stores, with one new company-operated store opened in Houston during Q1. In markets where stores opened, the company continued to see DTC customer growth. It expected to open 15 to 20 company-operated stores in 2022.
Black Rifle Coffee’s membership base grew 11% year over year to 296,000 members in Q1, with monthly churn below 4%.
Krispy Kreme reported Q1 revenue of $370 million, up 15.9% year over year, and net income attributable to the public company of $4 million, turning profitable. E-commerce represented 17.4% of total sales, and 18.6% of North American revenue.
By segment, North America, including Krispy Kreme, Insomnia Cookies and Branded Sweet Treats, generated $250 million in revenue. International markets, including the United Kingdom, Australia, New Zealand and Mexico, generated $87.2 million. Market Development, mainly franchise markets and Japan, generated $32.2 million.
As of April 3, Krispy Kreme had more than 11,000 shops and retail points globally. It added 600 in Q1, including 561 DFD Doors, similar to retail points inside convenience stores. Of those DFD additions, 207 were in the United States and Canada, 306 were in international markets, and 48 were in developing markets. DFD Doors had become one of the company’s growth drivers, with each DFD Door costing about $2,000 to $10,000.
The global network totaled 11,027 points, including 1,849 Krispy Kreme and Insomnia Cookies shops, 34 mobile food trucks and 9,144 DFD Doors. In Q1, the company opened 39 shops: three Hot Light Theatre Shops, 29 Fresh Shops and seven Insomnia Cookies shops.
Krispy Kreme continued to develop its hub-and-spoke model. As of April 3, it had 125 hub markets in North America, 37 in international markets and 133 in developing markets. Annual sales per hub market were $4.3 million in North America and $9.7 million internationally. Each hub could cover about 50 to 80 shops and retail points, with a hub-market investment payback period of three years.
Krispy Kreme expected to enter at least three new international markets each year, focused on Western Europe, South America and parts of Asia. It planned to enter markets including Chile, Jordan and Switzerland in 2022 or 2023.
Brinker International operates two main brands: American casual-dining chain Chili’s and Italian concept Maggiano’s. Chili’s had one store in Shanghai. As of March 30, Brinker International had 1,650 restaurants: 1,187 company-operated and 463 franchised.
Q1 revenue was $980 million, up 18% year over year. Net income was $36.6 million, up 8%.
By brand, Chili’s Q1 revenue was $880 million, up 15.3%, mainly because of traffic growth and price increases. Maggiano’s revenue was $100 million, up 54.1%.
In fiscal 2022, Brinker acquired 66 Chili’s restaurants from three franchisees.
According to Brinker International’s annual report, Chili’s average annual unit sales were $2.9 million. Menu prices ranged from $8 to $19.69, and average check was $15.50. Maggiano’s menu prices ranged from $8.50 to $41.99, with average annual unit sales of $5.3 million and average check of $25.78.
Chili’s units ranged from 3,200 to 8,100 square feet, or 297 to 752 square meters, with 140 to 350 seats and 20 to 70 tables. Maggiano’s units ranged from 8,200 to 28,400 square feet, or 761 to 2,638 square meters, with 260 to 770 seats and 60 to 100 tables.
Dine Brands’ two main brands are Applebee’s and breakfast chain IHOP. The group had 3,431 restaurants, 98% of which were franchised. It operated 69 company-owned Applebee’s restaurants, equal to 2% of the system.
Q1 revenue was $230 million, up 12.8% year over year. Net income attributable to the public company was $24.25 million, down 3%.
As of March 31, almost all Applebee’s and IHOP restaurants in the United States were no longer affected by government-mandated restrictions. That was an improvement from the same period in 2021, when about 23% of Applebee’s and 11% of IHOP restaurants were unrestricted. In international markets, 58% of restaurants were unrestricted as of March 31.
Applebee’s had 1,676 restaurants, including 1,607 franchised and 69 company-operated units. It had 1,575 domestic U.S. restaurants and 100 international restaurants. In Q1, average weekly sales per domestic restaurant were $54,000, and the brand had five net closures. Applebee’s annual unit sales increased from $2.2 million in 2017 to $2.6 million in 2021.
IHOP had 1,586 franchised restaurants and 155 area-franchised restaurants, for a total of 1,741. It had 1,661 domestic U.S. restaurants and 95 international restaurants. Q1 average weekly sales per franchised restaurant were $35,000, and the brand had five net new openings. Off-premise revenue accounted for 24.6% of sales, including delivery at 15.3% and takeaway at 9.3%.
The system also included 10 Applebee’s ghost kitchens in international markets and 19 IHOP ghost kitchens.
Dine Brands expected to open six traditional restaurants and six ghost kitchens in the year, while planning to close fewer than 15 restaurants.
Denny’s reported Q1 revenue of $100 million, up 28% year over year. Net income was $21.855 million, down 6%, and same-store sales rose 23.3%. Denny’s had 1,634 restaurants globally, including 153 outside the United States, with 96% franchised.
Thirty-five franchisees each operated more than 10 franchised restaurants, accounting for 64% of the franchised system. Q1 average weekly sales per domestic U.S. restaurant were $33,000. Half of restaurants had returned to 24/7 operating hours during the quarter.
Franchised Denny’s restaurants increased annual unit sales from $1.4 million in 2011 to $1.6 million in 2021. Company-operated restaurants increased annual unit sales from $1.8 million in 2011 to $2.7 million in 2021.
The company also announced an $82.5 million acquisition of Orlando-based breakfast chain Keke’s Breakfast Café. Keke’s had 52 restaurants, including eight company-operated and 44 franchised units. In 2021, Keke’s average annual unit sales were $1.9 million. After the acquisition, Keke’s Breakfast Café would continue to operate independently.
Ruth’s Hospitality’s main brand is Ruth’s Chris Steak House. As of March 27, Ruth’s Chris Steak House had 151 restaurants: 74 company-operated, three jointly operated, and 74 franchised restaurants across 32 countries, including Canada, China, Indonesia and Japan. In March, the brand opened one company-operated Ruth’s Chris Steak House.
Q1 revenue was $130 million, up 41.5% year over year. Net income was $10.41 million, up 14%.
Ruth’s Chris opened a franchised restaurant in Chongqing, China, in 2019. In 2021, it opened two franchised restaurants in Manila, Philippines, and Changsha, China. The brand had previously opened in Shanghai and Chengdu. The Shanghai Ruth’s Chris Steak House was also a Dianping Black Pearl restaurant.
The brand had four restaurants in mainland China, one in Hong Kong and four in Taiwan.
In 2021, Ruth’s Chris Steak House had an average check of $89. Restaurant sizes ranged from about 4,000 to 13,000 square feet, with 180 to 375 seats. Future openings were expected to focus on 6,000 to 10,000 square feet and 230 to 250 seats. In 2021, company-operated restaurants averaged $5.5 million in annual unit sales.
BJ’s Restaurants was founded in 1978 as a small pizza shop. In 1996, it launched its own craft beer, shifting from its original small-pizza-shop format toward a casual-dining chain and opening a larger format with brewing operations. As of May 2, BJ’s Restaurants had 213 restaurants.
The company’s market capitalization was close to $600 million at the time. For the first quarter ended March 29, BJ’s Restaurants reported revenue of $300 million, up 33.8% year over year. Net income was $1.46 million, turning profitable.
BJ’s menu prices generally ranged from $7.25 to $29.95. Average check increased from $18 in 2020 to $19 in 2021.
The average restaurant size was 7,500 square feet, accommodating 250 guests. Target build-out cost was $5.5 million to $6.5 million. Average pre-opening expense in fiscal 2021 was about $600,000.
In 2021, about 59% of BJ’s private-label craft beer products were brewed in-house. The company also produced its own non-alcoholic soda.
Note: Forward-looking store-opening plans, acquisition figures, payback-period targets and market-cap figures are historical, as reported in May 2022.