First Watch Restaurant Group reported strong earnings for the second quarter ended June 25 with double-digit revenues and sales growth as the Florida-based breakfast brand looks to more than quadruple in size in the coming years. In the second quarter, First Watch had more than 17% sales and revenue growth driven by positive same-store sales growth (of 7.8%), and nine restaurant openings over the quarter.
“Our teams across the system once again delivered strong results with same-restaurant sales growth of 7.8% driven by positive same-restaurant traffic growth in our dining rooms,” Chris Tomasso, First Watch CEO and president said in a statement. “This continued topline growth also translated to strong bottom-line performance.”
Tomasso reiterated that the company is looking to open 2,200 domestic restaurants, with 45-51 new restaurants opened before the end of 2023. Part of this expansion strategy is to repurchase franchised restaurants: in Q2 the company acquired six previously franchised restaurants in Nebraska with more to come.
Given the positive sales performance, First Watch has upgraded its future guidance from 18% to 21% revenue growth, despite challenges with traffic this quarter as traffic dipped into the negatives at -1.2%. Traffic has been improving even though it is still in the red, and First Watch said Mother’s Day was the highest sales day in company history.
“I am proud of our teams — both in the restaurants and at our home office — for their continued focus on superior execution,” Tomasso said. “We remain confident in our unique opportunity and the growth algorithm that underpins our long-term targets.”
Besides growth goals and franchise repurchasing plans, First Watch also continues to push its pipeline of menu innovation, including new summer menu items that were introduced in June like mint mocha and honey caramel crunch iced coffees, as well as a specialty summer menu that includes strawberry Tres Leches French Toast and bacon cheddar cornbread.
For the second quarter ended June 25, First Watch reported total revenues of $216.3 million, up 17.3% from $184.5 million. Net income increased to $8.0 million, or $0.13 earnings per share, up from $2.7 million, or $0.05 per share the same quarter the year prior.