“The team posted another strong quarter of growth on both the top and bottom line, increasing total revenue over 37 percent and adjusted EBITDA over 36 percent,” said Randy Garutti, CEO. “We added seven net new system-wide Shacks in both new and current markets, continuing the growth of our licensed business at home and abroad. Shacks outside of our comp base represented $24.5 million in increased revenue partially offset by a decline in same-Shack sales, but sequentially improved from last quarter. Even considering the same-Shack sales decline, coming from our small base of 37 Shacks, we’re reiterating our revenue growth targets for the year, our development schedule and the strength of our Shack-level operating profit.”
The company’s operating income increased 31.4 percent to $11.7 million, or 12.9 percent of total revenue. Operating profit increased 27.6 percent to $25.3 million, or 28.8 percent of sales.
Net income increased 25.0 percent to $8.2 million and net income attributable to Shake Shack Inc. was $4.9 million, or $0.19 per diluted share. Adjusted EBITDA increased 36.4 percent to $19.4 million.
During the quarter, the company opened four domestic company-operated restaurants, including the its first location in Lexington, Kentucky, as well as in Melville, New York, Chicago and Orlando at the Florida Mall. Additionally, the company opened two domestic licensed stores, including one in Minute Maid Park in Houston and LAX Airport, as well as two additional international licensed restaurants in South Korea.
“We’re incredibly excited about the recently announced agreement we executed to open Shake Shacks in Hong Kong and Macau, as we build on the strength of our Asian business with an eye towards China and further development through the region,” Garutti added. “We’re also proud of the technology, personalized marketing and menu innovation initiatives we’ve launched to date and, as we look to the future, we’re focused on investing in these key areas and the tremendous growth ahead of us."