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, 2022, and audited results for the twelve months ended December 31, 2022.
Q4-2022 Highlights – Excluding Venezuela
- Systemwide comparable sales increased 35.7 percent, with sustained growth in all divisions.
- Consolidated revenues totaled USD 1.0 billion, rising 30.3 percent in US dollars versus 2021.
- Consolidated Adjusted Ebitda reached a new quarterly record of USD 115.1 million.
- Consolidated Adjusted Ebitda rose 21.3 percent in US dollars, adjusting for the prior year’s notable items and the royalty rate increase in the fourth quarter of 2022.
- Basic net income was USD 55.7 million, or USD 0.26 per share, compared to basic net income per share of USD 0.22 in the prior year quarter.
- Net Debt to Adjusted Ebitda leverage ratio remained at a healthy 1.0x at year-end 2022.
FY-2022 Highlights – Excluding Venezuela
- Systemwide comparable sales increased 39.4 percent, with strong growth throughout the year and across all divisions.
- Consolidated revenues totaled USD 3.6 billion, rising 35.8 percent in US dollars versus 2021.
- Consolidated Adjusted Ebitda reached USD 390.1 million, the Company’s highest-ever for a full year, up 41.8 percent versus the prior year.
- Consolidated Adjusted Ebitda margin rose to 10.8 percent for the year, improving 40 basis points despite a challenging cost environment and the final step-up in the Company’s royalty rate.
- Basic net income was a record USD 144.8 million, or USD 0.69 per share, compared to a basic net income per share of USD 0.24 in the prior year.
- Gross restaurant openings reached 66 new units in 2022, including 59 free-standing units, with 40 gross openings in Brazil.
Chief Executive’s Commentary
CEO Marcelo Rabach: «We closed out Arcos Dorados’ best year ever with our best quarter ever thanks to disciplined execution of the Three D’s strategy, the best Brand in the QSR industry and the structural competitive advantage of our free-standing restaurant portfolio. We believe these factors, together with a commitment to continuous innovation, will drive financial outperformance for the foreseeable future. Our industry-leading Digital platform offers guests greater choices for how to enjoy the McDonald’s experience and the Brand’s connection with families remains at the core of its appeal. As a result, we are seeing very strong growth in on-premise sales, which represented 58 percent of sales during the fourth quarter 2022, even though off-premise sales growth remains very strong as well.
«As guest habits changed over the last two years, we adapted to those changes and met our guests on their own terms. They responded with incredible sales growth, leading to market share gains across all main markets with an average increase of more than four percentage points versus 2021. And the Brand also benefitted, with improved scores in 24 of the 25 brand attributes we track.
«Profitability has also never been higher, with full year Adjusted Ebitda growth of 41.8 percent versus 2021 and our highest consolidated Ebitda margin in history. This led to significant cash flow growth as well, and our balance sheet remains very healthy with a net leverage ratio of just 1.0x. Of course, our balance sheet includes the milestone 2029 Sustainability-Linked Bond we issued in May 2022, reinforcing our commitment to ESG by linking greenhouse gas emission reduction targets to our financing strategy.
«Finally, we exceeded our restaurant opening and remodeling targets, with 66 new McDonald’s restaurants opening their doors in 2022 and more than 110 Experience of the Future modernizations completed in the year. Most importantly, 2023 is off to a fast start and we believe the best is yet to come.»