El Pollo Loco reported Wednesday that systemwide sales decreased slightly in the first quarter due to the COVID-19 pandemic after building momentum through January and February.
The brand ended Q1 with a 1.5 percent decline in same-store sales. That’s after comps grew 3.7 percent systemwide and 4.2 percent at company-owned stores through February.
El Pollo said a “vast majority” of its units are operating via takeout, mobile pick-up, delivery, and drive-thru where it's available. It oversees more than 480 company-operated and franchised units across Arizona, California, Texas, Utah, Nevada, and Louisiana.
Before the pandemic, off-premises accounted for 78 percent of sales, including 45 percent from drive-thru and 3 percent from delivery. So far, the company hasn’t experienced any issues with the supply chain.
The restaurant noted that its marketing will highlight free delivery through Postmates, family meal options, and its value platform via $5 Fire-Grilled Combos.
To assist franchisees, El Pollo is deferring 50 percent of their royalties in April and all of their remodel and new build requirements. The chain also created a team to help operators access funds from the CARES Act. The stimulus package provides $349 billion of aid for small businesses in the form of forgivable loans. The funds are location-based, not overall, meaning large chains like El Pollo can access the funds when individual units apply.
For employees, the brand extended paid sick leave for employees impacted by COVID-19 and granted two weeks paid leave for employees 65 or older.
The company drew down its $150 million credit facility and added $34.5 million to its cash reserve. In addition, the brand suspended nonessential capital spending and share repurchase activity.
“El Pollo Loco remains a people-first company, and as such, the health, safety and wellbeing of our employees, franchisees, customers, and communities remains our top priority,” said CEO Bernard Acoca in a statement. “We are committed to helping our people and partners take care of themselves, their families, and each other during these challenging times.”