Papa John’s (NASDAQ: PZZA) reported its first-quarter earnings Thursday, ultimately topping analyst expectations. The pizza chain experienced a rise in demand throughout the coronavirus pandemic, which continues as the economy reopens. However, the stock fell 2.7% during premarket trading following the earnings announcement.
The American restaurant franchise disclosed earnings of USD0.90 per share compared to the expected USD0.56 a share. Revenue amounted to USD511.7Million, topping analysts estimated USD471 Million.
“Papa John’s started 2021 strongly, delivering our sixth straight quarter of industry outperformance and fourth of double-digit global sales growth. In addition, our unit growth accelerated, and we achieved 600 basis points of operating margin expansion, growing adjusted earnings per share 500%,” said President & CEO Rob Lynch. “This momentum is a result of the hard work of our team members and the strength of our franchise system, who together have delivered sustainable business growth over the past seven quarters, reversing the prior six quarters of global restaurant sales declines.”
North American same-store sales climbed 26.2%, topping the gain of 14.6% predicted by analysts. Meanwhile, same-store sales within its international business rose 23.2% during the quarter, above the expected 17.4%.
According to Lynch, the positive results can be attributed to a strategy implemented in 2019 which targeted innovation, development, bettering operations and constructing an all-embracing company culture.
“We’ve accelerated those strategies throughout the pandemic,” Lynch revealed. “Q1 has been the culmination of all of those things, amplified by the launch of Epic Stuffed Crust. It has been a huge success for our system, bringing in a whole new wave of customers, exceeding our expectations and increasing our ticket average, because it’s a premium pizza.”
Papa John’s stock has increased almost 11% throughout the year and has a market value of approximately USD3.1 Billion.