Shake Shack surprises with shiny quarterly results

After presenting its impressive third-quarter figures, Shake Shack can continue to gain momentum in the stock market. The stock of the popular burger chain operator saw an increase in value after the company presented its optimistic financial results. The adjusted earnings per share amounted to 25 cents, surpassing market expectations of 20 cents. Quarterly revenues reached USD 316.9 million, slightly above the estimates of USD 316.13 million. This total consists of USD 304.9 million from Shack sales and USD 12 million from licensing fees. The adjusted EBITDA increased by 28.0% to USD 45.8 million compared to 2023. The profit at the restaurant level was USD 64.2 million, representing 21.0% of Shack sales. CFO Katie Fogertey expressed satisfaction with the improvements in operational business and margin expansion: "With strong sales and operational improvements, we have been able to significantly expand the profit margin at the restaurant level and the adjusted EBITDA margin year-over-year. The third quarter records the highest margins since the fiscal year 2019." The company achieved system-wide sales of USD 495.1 million, an increase of 12.8% compared to 2023. Same Shack sales increased by 4.4%. An operating loss of USD 18.0 million, due to write-offs and closures, contrasts with last year's USD 5.7 million operating profits. "In the quarter, we opened 17 new Shacks worldwide and are on track to conclude fiscal year 2024 successfully, creating a stable foundation for the next year," explained CEO Rob Lynch. For the fourth quarter, the company expects total revenues between USD 322.6 million and USD 327 million, while market expectations are USD 323.89 million. For fiscal year 2024, revenue of approximately USD 1.25 billion is expected. On the market, the SHAK stock recently moved 13% up, reaching USD 128.35.