Noodles & Company (NASDAQ: NDLS) reported Q4 EPS of ($0.04), $0.07 worse than the analyst estimate of $0.03. Revenue for the quarter came in at $107.2 million versus the consensus estimate of $107.46 million.

Key highlights for the fourth quarter of 2020 compared to the same quarter of 2019 include:

• Total revenue decreased 5.9% to $107.2 million from $113.9 million.
• Comparable restaurant sales decreased 4.7% system-wide, decreased 4.2% for company-owned restaurants and decreased 7.9% for franchise restaurants.
• Digital sales grew 128% and accounted for 62% of sales.
• Net loss was $3.8 million, or $0.09 loss per diluted share compared to net loss of $1.2 million, or $0.03 loss per diluted share.
• Adjusted net loss was $1.6 million, or $0.04 loss per diluted share, compared to adjusted net income of $3.0 million, or $0.07 earnings per diluted share.
• Restaurant contribution margin decreased 360 basis points to 13.6%.
• Adjusted EBITDA decreased 51.3% to $5.3 million from $10.9 million.

Dave Boennighausen, Chief Executive Officer of Noodles & Company, remarked, “Our fourth quarter results reflect the continued resiliency of our brand, particularly surrounding our digital and off-premise capabilities, even against the resurgence of COVID-19 during the quarter. Our ability to accelerate these areas and adapt to rapidly changing consumer preferences is a testament to our brand strength, our unit economic model and most importantly, our incredible team members. Noodles & Company’s differentiated menu, bolstered by the recent introduction of our low-carb Cauliflower Gnocchi, supported by a robust digital program which grew to 62% of sales in the fourth quarter, is particularly well suited for the needs of today’s consumer.”

Boennighausen continued, “Thus far in 2021, we have seen nice momentum in our comparable restaurant sales and AUV growth relative to fourth quarter 2020, as well as continued strength in our recent openings. As we look further ahead, we are more encouraged than ever that our brand is well positioned to thrive in the years to come. We believe the Company will significantly accelerate unit growth from a company and franchise perspective, as well as meaningfully expand both average unit volumes and restaurant level margins. The Company’s resiliency demonstrated during the pandemic, combined with the success of recent openings and digital and menu strengths, support our confidence in achieving these accelerated growth objectives.”

Business Outlook

Due to the ongoing uncertainty surrounding the future impact of COVID-19 and its potential impact on the Company’s near-term operations, Noodles & Company is not providing full financial guidance for fiscal year 2021. However, the Company is providing the following expectations within 2021:

• First quarter 2021 comparable restaurant sales in the mid-to-high single digits;
• Approximately ten to fifteen new restaurants system-wide in 2021, including eight to eleven company locations;
• Capital expenditures of $20 million to $24 million in 2021.

Based on the Company’s strategic framework, the Company outlined its accelerated growth objectives, including the following:

• System-wide unit growth of at least 7% annually beginning in 2022, quickly reaching 10% annual growth on a path to at least 1,500 units;
• Average unit volumes of $1.45 million by 2024; and
• Restaurant contribution margin of 20% by 2024.

Serving as a foundation to its 3-year strategic framework are the following key elements:

• Building a robust, high-returns real estate pipeline of both company-owned and franchised locations;
• Driving frequency of existing guests and attracting new guests, supported by our menu innovation, loyalty program and digital capabilities; and
• Optimizing restaurant operating costs through further enhancements in supply chain management, streamlined operations and more efficient back of the house equipment.

For earnings history and earnings-related data on Noodles & Company (NDLS) click here.