Potbelly Q3 2020 Earnings Report
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.
Potbelly
Potbelly
Potbelly 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