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Sep 24, 2023

First Watch Q3 2023 Earnings Report

Reported strong Q3 revenue and earnings results, surpassing 500 system-wide restaurants.

Key Takeaways

First Watch reported a strong Q3 2023 with a 17.3% increase in total revenue, 4.8% same-restaurant sales growth, and a net income of $5.4 million. The company opened 13 new restaurants and acquired 11 franchise-owned restaurants, reaching a total of 505 system-wide restaurants. They also raised their 2023 same-restaurant sales growth, total revenue growth and Adjusted EBITDA guidance.

Total revenues increased 17.3% to $219.2 million.

Same-restaurant sales growth of 4.8%.

Net income increased to $5.4 million, or $0.09 per diluted share.

Opened 13 system-wide restaurants and acquired 11 operating franchise-owned restaurants, resulting in a total of 505 system-wide restaurants.

Total Revenue
$219M
Previous year: $187M
+17.3%
EPS
$0.09
Previous year: $0.00076
+11742.1%
Same-Restaurant Sales Growth
4.8%
Previous year: 12%
-60.0%
Same-Restaurant Traffic Growth
-1.9%
Previous year: 3.7%
-151.4%
Restaurant-Level Operating Profit Margin
18.7%
Previous year: 17.3%
+8.1%
Gross Profit
$44.1M
Previous year: $26.1M
+69.1%
Cash and Equivalents
$40.2M
Previous year: $49.4M
-18.5%
Free Cash Flow
-$5.63M
Previous year: -$3.59M
+57.0%
Total Assets
$1.21B
Previous year: $1.09B
+10.6%

First Watch

First Watch

Forward Guidance

The Company updates its guidance for the 53-week fiscal year ended December 31, 2023:

Positive Outlook

  • Same-restaurant sales growth in the range of 7.0% to 8.0% with generally flat same-restaurant traffic growth
  • Total revenue growth in the range of 20.0% to 21.0%
  • Adjusted EBITDA in the range of $91.0 million to $92.0 million
  • Blended tax rate in the range of 26.0% to 28.0%
  • Total of 49-52 new system-wide restaurants, net of 1 company-owned restaurant closure (37 to 39 new company-owned restaurants and 13 to 14 new franchise-owned restaurants)