Wendy’s total revenues in Q3 2022 hit $532.6 million, a healthy increase from $470.3 million in the third quarter of 2021 and the brand’s operating profit was $98.1 million compared to $80.2 million a year ago.
The revenue increase was driven by the acquisition of 93 franchise-operated restaurants in Florida in the last quarter of 2021 and higher same-restaurant sales, according to a press release on the quarterly financials. Revenues increased due to an increase in franchise royalty revenue and advertising funds revenue due to higher same restaurant sales.
“I am proud of the Wendy’s system for achieving significant one-year global same-restaurant sales acceleration, which allowed us to deliver a fourth consecutive quarter of double-digit global same-restaurant sales on a two-year basis,” President and CEO Todd Penegor said in the release. “This extends our track record of consistent sales growth while highlighting the strength of our strategic pillars. We expanded our global footprint, held global digital sales mix at approximately 10%, and accelerated our U.S. breakfast daypart over the course of the quarter following our first major menu innovation since launching. Our focus on executing against our priorities, our alignment with the best franchisees in the business and the continued dedication of our employees give me the confidence that we will achieve our vision of becoming the world’s most thriving and beloved restaurant brand.”
Net income was $50.5 million in Q3 2022 compared to $41.2 million in Q3 2021 due primarily from an increase in operating profit. Adjusted EBITDA was $134.5 million in Q3 compared to $112.2 million in Q3 2021. The increase resulted primarily from higher other operating income, higher franchise royalty revenue and the favorable impact of the acquisitions.
The adjusted EPS was $0.24 compared to $0.19 in Q3 2021. The increase was driven by an increase in adjusted EBITDA, fewer shares outstanding as a result of the company’s share repurchase program and higher interest income.
This year the brand expects:
- Global systemwide sales growth of 6% to 7%.
- Adjusted EBITDA of $490 million to $500 million.
- Cash flows from operations of $305 million to $320 million.
- Capital expenditures of $90 million to $95 million.
- Adjusted EPS of $0.84 to $0.88.
- Free cash flow of $215 million to $225 million.
