Buffalo Wild Wings Inc.’s fourth-quarter profit fell 2.4 percent, as higher labor costs and chicken wing prices offset improving sales, the company said Thursday
Net income at the Minneapolis-based casual-dining operator fell to $20.3 million during the fourth quarter ended Dec. 28, or $1.07 per share, from $20.8 million, or $1.11 a share, the previous year.
Same-store sales rose 5.9 percent during the quarter at company-owned locations, and sales appeared to be accelerating in January, Buffalo Wild Wings said. Same-store sales have risen 11.9 percent in the first five weeks of the first quarter of 2015.
Buffalo Wild Wings’ net income rose 31 percent, to $4.95 per share, in fiscal 2014, while same-store sales increased 6.5 percent at company-owned restaurants.
“Buffalo Wild Wings had a great year,” CEO Sally Smith said in a statement. “With wall-to-wall televisions and big screens, Buffalo Wild Wings remains the place to cheer on your favorite sports teams. Our restaurants deliver memorable game-day experiences to guests no matter what the season.”
Revenue increased 19.7 percent during the quarter, to $408.9 million, from $341.5 million a year ago.
The company indicated earlier that both food and labor costs would increase in the fourth quarter, Smith said. Food costs rose because the price for chicken wings increased in the fourth quarter. Cost of sales rose to 30.6 percent of revenue in the quarter, compared with 29.8 percent a year ago.
Labor costs increased because of higher minimum wages in states where 1,000-unit Buffalo Wild Wings is expanding, and because the company is putting “guest experience captains” in corporate restaurants to improve service and drive sales. Labor costs accounted for 31.1 percent of sales in the quarter, an increase from 30 percent in the fourth quarter of 2013.
4Q NET INCOME
Result: $20.3 million, or $1.07 per share% Decrease: 2.4% (from $20.8 million, or $1.11 per share)
4Q REVENUE
Result: $408.9 million% Increase: 19.7% (from $341.5 million)
4Q SAME-STORE SALES
% Increase corporate: 5.9%
% Increase franchised: 5.1%
Source: Company report
FULL YEAR NET INCOME
Result: $94.1 million, or $4.95 per share% Increase: 31% (from $71.6 million, or $3.81 per share)
FULL YEAR REVENUE
Result: $1.5 billion% Increase: 19.7% (from $1.3 billion)
FULL YEAR SAME-STORE SALES
% Increase corporate: 6.5%
% Increase franchised: 5.6%
Source: Company report
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