Zoe's Kitchen, Inc. (ZOES) Tops Q3 EPS by 1c, Slight Miss on Revenues; FY17 Revenues Mid-Point Guidance Below Consensus

Zoe's Kitchen, Inc. (NYSE: ZOES) reported Q3 EPS of $0.01, $0.01 better than the analyst estimate of $0.00. Revenue for the quarter came in at $77.9 million versus the consensus estimate of $78.75 million.

FY 2017 Outlook

For the fiscal year ending December 25, 2017, the Company is revising its outlook as follows:

• Total revenue between $314.0 million and $316.0 million (revised from $314.0 million to $322.0 million).
• Comparable restaurant sales of negative 2.0% to negative 2.5% (revised from flat to negative 3.0%).
• 38 to 40 Company-owned restaurant openings (unchanged from previous guidance).
• Restaurant contribution margin between 18.3% and 18.5% (revised from 18.3% to 19.0%).
• General and administrative expenses between 10.7% and 10.8% of total revenue, inclusive of $3.2 million of non-cash equity based compensation expense (revised from 10.7% to 10.9%).

Highlights for the twelve weeks ended October 2, 2017, as compared to the twelve weeks ended October 3, 2016:

• Total revenue increased 15.7% to $77.9 million inclusive of an estimated $1.1 million of negative revenue impact related to Hurricanes Harvey and Irma.
• Comparable restaurant sales decreased 0.5% inclusive of an estimated 0.9% of negative comparable sales impact related to Hurricanes Harvey and Irma.
• 11 new Company-owned restaurants opened.
• Income from operations decreased 38.8% to $1.3 million.
• Restaurant contribution* increased 13.4% to $14.6 million, or 18.8% of restaurant sales.
• Net income of $0.3 million, or $0.01 per basic and diluted share, compared to net loss of $0.3 million, or $0.02 per basic and diluted share.
• Adjusted EBITDA* increased 4.7% to $6.9 million.
• Adjusted net income* of $0.2 million, or $0.01 per diluted share, compared to adjusted net income of $0.7 million, or $0.04 per diluted share.

GUIDANCE:

Zoe's Kitchen, Inc. sees FY2017 revenue of $314-316 million, versus the consensus of $316.83 million.

For earnings history and earnings-related data on Zoe's Kitchen, Inc. (ZOES) click here.

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