Portillo's Q2 2023 Earnings Report
Key Takeaways
Portillo's Inc. reported a 12.3% increase in total revenue to $169.2 million, with same-restaurant sales increasing by 5.9%. Operating income remained relatively stable at $17.4 million, while net income decreased slightly to $9.9 million. The company opened one new restaurant during the quarter, bringing the total to 76 restaurants.
Total revenue increased by 12.3% to $169.2 million compared to Q2 2022.
Same-restaurant sales grew by 5.9%, driven by a 7.1% increase in average check, offset by a 1.2% decrease in transactions.
Operating income remained consistent at $17.4 million, while net income decreased to $9.9 million.
Restaurant-Level Adjusted EBITDA increased to $42.7 million, and Adjusted EBITDA increased to $29.2 million.
Portillo's
Portillo's
Forward Guidance
The company plans to open eight more new restaurants in the third and fourth quarters of 2023 and expects overall commodity inflation to ease over the course of the year, estimating mid-single-digit commodity inflation for the full fiscal year. The company also anticipates mid-single-digit labor inflation for the full fiscal year.
Positive Outlook
- Plans to open eight more new restaurants in Q3 and Q4 2023.
- Expects commodity inflation to ease over the year.
- Strategic pricing actions, elevated guest experiences, and operational efficiencies.
- Ongoing efforts to improve Restaurant-Level Adjusted EBITDA margins for fiscal 2023.
- Will continue to monitor the environment and make additional pricing decisions, if necessary.
Challenges Ahead
- Potential risks related to food-borne illness and food safety.
- Impact of unionization activities on operations and profitability.
- Impact of recent bank failures on the marketplace, including access to credit.
- Privacy and cyber security risks related to digital ordering and payment platforms.
- Increasingly competitive labor market and ability to attract and retain qualified employees.