Potbelly Corporation (PBPB – Free Report) reported fourth-quarter fiscal 2024, with earnings beating the Zacks Consensus Estimate and revenues missing the same. The top line declined year over year while the bottom line increased from the prior-year quarter’s figure. Following the results, the company’s shares fell 9.4% during the after-hours trading session yesterday.
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PBPB’s Q4 Earnings & Revenues
For the fiscal fourth quarter, the company reported adjusted earnings per share (EPS) of 13 cents, beating the Zacks Consensus Estimate of 6 cents. The company reported an adjusted EPS of 2 cents in the prior-year quarter.
Quarterly revenues of $116.6 million missed the consensus mark by 0.2%. The top line declined 7.3% on a year-over-year basis. The decline was largely due to the absence of a 53rd week in 2024 and the company’s ongoing refranchising strategy, which has involved selling 34 company-owned locations since second-quarter fiscal 2023.
Potbelly Corporation Price, Consensus and EPS Surprise
Potbelly Corporation price-consensus-eps-surprise-chart | Potbelly Corporation Quote
During the quarter, company-operated comparable store sales increased 0.3% year over year compared with the 6.3% rise reported in the prior-year quarter.
PBPB Q4 Operating Highlights
During the quarter under review, labor and related expenses — as a percentage of sales — were 28.9%, compared with 28.8% reported in the year-ago quarter.
Occupancy costs (as a percentage of sales) were 10.8% compared with 10.5% reported in the year-ago quarter.
General and administrative expenses (as a percentage of sales) of 11.1% decreased by 80 bps on a year-over-year basis.
During the quarter, shop-level profit margin came in at 16% compared with 15.7% reported in the prior-year quarter.
Adjusted net income during the quarter came in at $3.9 million compared with $0.7 million reported in the prior-year quarter.
Adjusted EBITDA in the fiscal fourth quarter came in at $9.7 million compared with $7.5 million reported in the prior-year quarter.
PBPB’s Balance Sheet
As of Dec. 29, 2024, cash and cash equivalents totaled $11.7 million compared with $33.8 million as of Dec. 31, 2023. At the end of the fiscal fourth quarter, long-term debt, net of the current portion, amounted to $4 million compared with $19.2 million at the end of the fourth quarter of fiscal 2023.
PBPB’s Fiscal 2024 Highlights
Total revenues in fiscal 2024 amounted to $462.6 million compared with $491.4 million in fiscal 2023.
Adjusted EBITDA in fiscal 2024 totaled $32.6 million compared with $28.3 million in fiscal 2023.
In fiscal 2024, adjusted EPS came in at 30 cents compared with 15 cents reported in the previous year.
PBPB’s Fiscal 2025 Outlook
For first-quarter fiscal 2025, PBPB anticipates same-store sales to decline in the range of 0.5% and 1.5%. It expects adjusted EBITDA to range between $3.5 million and $4.5 million.
In fiscal 2025, the company expects same-store sales to grow between 1.5% and 2.5%. The company forecasts adjusted EBITDA between $33 million and $34 million. PBPB plans to open at least 38 new locations in the fiscal 2025.
PBPB’s Zacks Rank & Other Key Picks
Potbelly currently has a Zacks Rank #1 (Strong Buy).
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