Papa John’s: Announces Q2-2023 Financial Results

Louisville / KY. (pj) Papa John’s International Inc., one of the world’s largest pizza delivery companies, announced financial results for the second quarter ended June 25, 2023. Highlights:

  • North America comparable sales were down 1 percent compared with the second quarter of 2022 as the strength of Domestic Company-owned restaurants was offset by lower North America franchised restaurant comparable sales; International comparable sales were down 1 percent from a year ago and improved 5 percent from the first quarter.
  • 47 net unit openings in the second quarter driven by International growth; On track to achieve 270 to 310 net new units in 2023.
  • Global system-wide restaurant sales were USD 1.22 billion, a 2 percent(a) increase from the prior year second quarter.
  • Total revenues of USD 515 million were down 2 percent from the second quarter a year ago driven by lower revenues in our North American commissary segment due to commodity price declines.
  • Diluted earnings per common share was USD 0.54, compared with USD 0.70 for the second quarter of 2022; Adjusted diluted earnings per common share(b) was USD 0.59, compared with USD 0.74 for the second quarter a year ago.
  • Announced 10 percent increase in annual dividend rate to USD 1.84 per share; declared third quarter dividend of USD 0.46.

«We are pleased with the solid execution that our teams have demonstrated in what continues to be a challenging operating environment,» said Rob Lynch, President and CEO. «Our company restaurants continued their strong performance with positive comp sales growth and year-over-year margin improvement above and beyond the benefits of moderating food costs. However, this solid performance was not enough to offset the lower-than-anticipated comps our franchisees experienced during the quarter. That being said, our entire system saw sequential sales improvement throughout the quarter with positive North America comp sales in June. This positive momentum has carried over, and accelerated, into the third quarter and we expect it to continue as we optimize our system’s revenue management strategies and expand one of our most popular pizza platforms with the recent introduction of Garlic Epic Stuffed Crust Pizza.»

Commenting on the Company’s International operations, Lynch stated, «Our international business is a long-term growth driver for Papa Johns. We’ve recently established a corporate-owned restaurant portfolio in the UK, our largest international market, allowing us to build a similar success model to the one we’ve created in the US. This model accelerates our ability to scale our company’s capabilities with franchisees in the UK, and worldwide, to grow comps and new unit development. While we know there will be macro-economic challenges ahead, particularly in the short term, we’re confident that we can improve sales and profitability within our UK market, and in our international segment overall.»

Lynch concluded by stating, «The level of operating and fiscal discipline our team has implemented across our business over the past year is remarkable. Our continued investments in sales-driving capabilities and operational excellence, combined with the strength of our balance sheet, gives us confidence that we will produce positive comp sales and attractive new unit development growth in the back half of 2023 and over the long-term.» For additional information please read the Company’s PDF file below (173 KB):