Montevideo / UY. (arc) Arcos Dorados Holdings Inc., Latin America’s largest restaurant chain and the world’s largest independent McDonald’s franchisee, reported unaudited results for the three months ended December 31, 2020, and audited results for the full year 2020.
Fourth Quarter 2020 Highlights – Excluding Venezuela
- Consolidated revenues totaled USD 605.7 million, 19.5 percent lower in US Dollars, or 5.3 percent lower on a constant currency basis1, versus the prior year period.
- Systemwide comparable sales1 declined 7.9 percent versus the prior year quarter, despite a tough comparison, reflecting another strong sequential quarterly improvement.
- Food and Paper costs declined by nearly 35 basis points as a percentage of sales at company-operated restaurants, compared with the prior year period.
- All four Divisions added to a positive Consolidated Adjusted Ebitda margin of 9.6 percent, compared to 5.5 percent in 3Q20 and 13.5 percent in 4Q19, which included a 130 basis point contribution from a non-cash bad debt reserve reversal in Puerto Rico.
- Basic net income per share was USD 0.12, compared to basic net income of USD 0.18 per share in the prior year quarter.
Full Year 2020 Highlights – Excluding Venezuela
- Consolidated revenues totaled USD 2.0 billion, a 32.9 percent decrease in US Dollars, due to the impact of the Covid-19 pandemic and the depreciation of several local currencies. On a constant currency basis, consolidated revenues declined 20.0 percent.
- Systemwide comparable sales declined 22.3 percent versus 2019.
- Food and Paper costs were 10 basis points lower as a percentage of sales at company-operated restaurants versus 2019, successfully off-setting significant cost pressures.
- Consolidated Adjusted Ebitda of USD 72.5 million was 75.5 percent and 75.9 percent lower in US Dollars and on a constant currency basis, respectively, impacted by the Covid-19 pandemic.
- Consolidated Adjusted Ebitda margin contracted 6.3 percentage points to 3.7 percent, primarily due to the impact of the pandemic on the Company’s ability to leverage its fixed costs.
- G+A expenses decreased 19.2 percent in US Dollars and 2.0 percent in constant currency terms.
- Basic net loss per share was USD (0.69), compared to net income per share of USD 0.43 in the previous year.
«In 2020 we faced the most unexpected and unprecedented crisis of our lifetimes, forcing us to find new ways to work in our restaurants and offices while managing a business with an enormous geographic footprint and a vast network of suppliers and sub-franchisees. We met the challenge because of our proactive and aggressive responses to the crisis. But also because we have historically taken a long-term, strategic approach to growth. Our best-in-class free-standing restaurant footprint supported the strong growth of Drive-thru, Delivery and Digital throughout the year. We strengthened the McDonald’s brand through significant market share gains in many key markets. The McProtegidos program also contributed to Brand trust, consolidating McDonald’s as the safest restaurant experience in the QSR industry. Financial results improved steadily during the second half of 2020 and our disciplined financial management ensured a relatively modest increase in financial leverage despite the material impact of the pandemic on full year results,» said Marcelo Rabach, Chief Executive Officer of Arcos Dorados.
«Looking ahead, we are increasing our commitment to make a positive influence on the communities we serve. I am proud to announce that Arcos Dorados is the first major restaurant operator in Latin America and the Caribbean to incorporate ESG indicators in its executive variable compensation program. Starting this year, in order to reach their full variable compensation targets, our bonus-eligible employees will need to meet objectives related to youth opportunity as well as responsible and ethical business practices. With respect to this year’s financial results, we expect some uncertainty in the short-term, but we firmly believe Arcos Dorados is poised for long-term success as market conditions normalize over the course of 2021,» he concluded.
For additional information please read the Company’s PDF file below (159 KB):20210317-ARCOS-DORADOS-FY-2020