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Shake Shack’s same-store sales rose 3.5% in the second quarter as the company’s digital business, and the World Cup, helped it withstand the onslaught of discounts from major burger rivals. But beef costs continue to be a problem. Net income in the quarter declined 9% in the period to $16.9 million.
Restaurant-level profit margin was 23% of sales, down from 23.9% in the same period a year ago. Though CEO Rob Lynch noted that the profitability result was still impressive given the circumstances, calling it “a healthy result given record-high beef costs and the deliberate choice to protect our value positioning rather than fully offset inflation through pricing.” Revenues at the company grew 17.2% to $417.6 million while systemwide sales, which also includes the company’s substantial licensing business, grew 13.8% to $625.8 million. Shake Shack executives told analysts on the company’s earnings call Wednesday that the World Cup provided a boost to same-store sales in the period.