Buffalo Wild Wings (BWLD) has reported a 34.25 percent plunge in profit for the quarter ended Mar. 26, 2017. The company has earned $21.55 million, or $1.25 a share in the quarter, compared with $32.77 million, or $1.73 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $24.75 million, or $1.44 a share compared with $33.72 million or $1.78 a share, a year ago.
Revenue during the quarter grew 5.22 percent to $534.76 million from $508.26 million in the previous year period. Gross margin for the quarter contracted 239 basis points over the previous year period to 39.97 percent. Total expenses were 93.68 percent of quarterly revenues, up from 90.83 percent for the same period last year. That has resulted in a contraction of 285 basis points in operating margin to 6.32 percent.
Operating income for the quarter was $33.78 million, compared with $46.60 million in the previous year period.
Sally Smith, president and chief executive officer, commented, "In the first quarter, we are pleased same-store sales turned positive for both company-owned and franchised locations, outperforming both the negative restaurant industry and a negative casual dining segment. This is due to the continued momentum of our strategic initiatives launched in 2016. The popularity of Half-Price Wing Tuesdays® combined with higher wing prices increased our cost of sales. Labor and operating expenses were also higher compared to the prior year, resulting in lower restaurant-level and operating margins and negatively impacting EPS for the quarter."
For financial year 2017, the company projects diluted earnings per share to be in the range of $5.20 to $5.50. The company projects diluted earnings per share to be in the range of $5.45 to $5.90 on adjusted basis.
Operating cash flow drops significantly Buffalo Wild Wings has generated cash of $48.85 million from operating activities during the quarter, down 36.64 percent or $ 28.25 million, when compared with the last year period.
The company has spent $17.14 million cash to meet investing activities during the quarter as against cash outgo of $37.95 million in the last year period.
The company has spent $42.39 million cash to carry out financing activities during the quarter as against cash outgo of $38.46 million in the last year period.
Cash and cash equivalents stood at $38.61 million as on Mar. 26, 2017, up 230.21 percent or $26.92 million from $11.69 million on Mar. 27, 2016.
Working capital remains negative
Working capital of Buffalo Wild Wings was negative $60.18 million on Mar. 26, 2017 compared with negative $83.93 million on Mar. 27, 2016. Current ratio was at 0.68 as on Mar. 26, 2017, up from 0.54 on Mar. 27, 2016.
Days sales outstanding went down to 7 days for the quarter compared with 8 days for the same period last year.
Days inventory outstanding was almost stable at 4 days for the quarter, when compared with the last year period. At the same time, days payable outstanding went down to 11 days for the quarter from 13 for the same period last year.
Debt increases substantially Buffalo Wild Wings has witnessed an increase in total debt over the last one year. It stood at $383.27 million as on Mar. 26, 2017, up 711.85 percent or $336.06 million from $47.21 million on Mar. 27, 2016. Total debt was 39.58 percent of total assets as on Mar. 26, 2017, compared with 4.86 percent on Mar. 27, 2016. Debt to equity ratio was at 1.17 as on Mar. 26, 2017, up from 0.07 as on Mar. 27, 2016. Interest coverage ratio deteriorated to 14.33 for the quarter from 55.48 for the same period last year. Disclaimer: Please note that this is an auto-generated article. IRIS does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. IRIS especially states that it has no financial liability whatsoever to any user on account of the use of information provided on its website. For queries contact: [email protected]
