Noodles & Company’s sales are continuing to recoup after seeing figures drop as much as 55 percent systemwide in the final week of March.
In the week ending June 16, comp sales dropped 14.8 percent at company-owned stores, up from a 47 percent decrease in April and a 29 percent slide in May. Digital sales mixed 67 percent last week, compared to 31 percent in Q1.
Sales have sequentially increased in the past several weeks even with most dining rooms closed. As of Tuesday, 20 percent of restaurants have reopened dining rooms, including 7 percent of corporate units and 87 percent of franchises.
The company’s slow march toward reopening dining rooms is similar to what’s been seen across the quick-service segment.
“The value of incremental on-premise sales isn’t as important to quick-service restaurants,” said David Portalatin, NPD food industry advisor and author of Eating Patterns in America, in a statement. “In fact, some have resisted reopening dining rooms preferring to forego the incremental cost of doing so and continue to optimize off-premise sales.”
Here’s how comp sales have trended through Q2:
- Company-owned: –47 percent
- Franchise: –55 percent
- Systemwide: –48.2 percent
- Company-owned: –28.9 percent
- Franchise: –37.3 percent
- Systemwide: –30.1 percent
Week ending June 2
- Company-owned: –23.2 percent
- Franchise: –25.7 percent
- Systemwide: –23.6 percent
Week ending June 9
- Company-owned: –20.2 percent
- Franchise: –23.2 percent
- Systemwide: –20.6 percent
Week ending June 16
- Company-owned: –14.8 percent
- Franchise: –16.8 percent
- Systemwide: –15.1 percent
Quarter to date
- Company-owned: –33.2 percent
- Franchise: –39.8 percent
- Systemwide: –34.1 percent
“Our food travels extremely well, and our guests are already accustomed to seamlessly ordering through our digital channels to enjoy the variety and value in our menu regardless of where they were dining,” Dave Boennighausen said during the company’s earnings call in May. “We've been able to leverage that strength as well as build upon it with our recent initiatives, resulting in the consistent improvement we have seen during the last few weeks.”
Noodles & Company also announced the rollout of Perfect Bowls, dishes that cater to health-conscious diets including paleo-friendly, keto, vegetarian, and gluten-sensitive. The company also expanded its healthy family meal offerings with Zoodle and Caulifloodle options, giving customers the chance to enjoy four dishes plus a Caesar salad at $40.
As of Wednesday, the company has $62.4 million in cash on hand.
Same-store sales were up 5.5 percent during the first 10 weeks of Q1, including positive traffic. This followed a Q4 where comps lifted 2.9 percent to give Noodles & Company seven consecutive periods of positive gains.
Q1 finished at negative 7.2 percent following March’s coronavirus impact. Net loss was $5.8 million, or 13 cents per diluted share, compared to 1.9 million in Q1 2019. Revenue declined 8.8 percent to $100.3 million.
The brand furloughed 10 percent of its Central Support Office—with another 20 percent reduced to part-time—and reduced salaries for executives and non-furloughed, full-time Central Support Office employees. The compensation for the board of directors was reduced, as well.