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Sep 27, 2020
Potbelly Q3 2020 Earnings Report
Potbelly reported improvements in business trends and reached profitability at the shop level.
Key Takeaways
Potbelly Corporation reported financial results for the third fiscal quarter ended September 27, 2020, showing improvements in same-store sales and reaching profitability at the shop level. The company is implementing a new strategic focus on "Traffic Driven Profitability" and announces a G&A restructuring expected to yield $3.5-$4.0 million in annual corporate expense optimization.
Same-store sales trends continued to improve, ending the period at (21.0%), a 2,000-basis point improvement from the previous quarter.
Reached profitability at the shop level during the quarter and continued through the end of October.
Weekly cash burn remained in-line with the targeted $0.5 million per week average.
Constructive lease discussions resulted in the closure of approximately 25-30 shops and the renegotiation of 280 leases as of early November.
Revenue by Segment
Forward Guidance
Potbelly is launching a corporate expense optimization and restructuring focused on driving efficiencies, rightsizing General & Administrative expenses, and better aligning cost structure to new footprint and strategic direction.
Positive Outlook
- Corporate expense optimization and restructuring focused on driving efficiencies.
- Rightsizing General & Administrative expenses including staff reductions above the shop level to be completed by year end.
- Better aligning cost structure to new footprint and strategic direction.
- Expected reduction of annual G&A costs by $3.5 million to $4.0 million.
- Consolidation of franchise and company locations support services into one unit.
Revenue & Expenses
Visualization of income flow from segment revenue to net income
Historical Earnings Impact
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Avg. Return Before/After Earnings
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