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Apr 01, 2023
European Wax Center Q1 2023 Earnings Report
European Wax Center reported solid first quarter performance driven by unit growth and in-center sales growth, while reiterating fiscal year 2023 outlook.
Key Takeaways
European Wax Center reported a solid first quarter with a 9.8% increase in total revenue to $49.9 million and system-wide sales growth of 5.5%. The company opened 34 net new centers, representing a 12% year-over-year growth. Despite the revenue increase, the company reported a GAAP net loss of $1.1 million, but adjusted EBITDA increased by 7.5% to $16.3 million.
Net new centers increased by 11.9% to a total of 978 centers across 45 states.
System-wide sales increased by 5.5% to $218.4 million.
Total revenue increased by 9.8% to $49.9 million.
Same-store sales increased by 4.5%.
European Wax Center
European Wax Center
European Wax Center Revenue by Segment
Revenue by Segment
Product Sales Revenue
CapyFin.comRoyalty Fees Revenue
CapyFin.comMarketing Fees Revenue
CapyFin.comOther Revenue
CapyFin.com Forward Guidance
The Company reiterates its previous outlook for fiscal year 2023.
Positive Outlook
- New Center Openings, Net: 95 to 100
- System-Wide Sales: $965 million to $990 million
- Total Revenue: $222 million to $229 million
- Same-Store Sales: Mid-Single Digits
- Adjusted Net Income: $22 million to $24.5 million
Challenges Ahead
- Fiscal 2022 and Fiscal 2023 each include a 53rd week in the fourth quarter.
- The Company estimates the 53rd week contribution to the top and bottom line is worth approximately one half of an average fourth quarter week.
- The Company's current outlook assumes no meaningful change in consumer behavior driven by inflationary pressures or the COVID-19 pandemic
- The Company's current outlook assumes no further impacts from incremental tightening in the labor market beyond what we see today.
- Adjusted net income outlook assumes a 20% effective tax rate for Fiscal 2023.