Wingstop Inc. (NASDAQ:WING) Q1 2017 Earnings Conference Call - Final Transcript

May 04, 2017 • 04:30 pm ET

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Wingstop Inc. (NASDAQ:WING) Q1 2017 Earnings Conference Call - Final Transcript

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Presentation
Operator
operator

Good day, ladies and gentlemen. Thank you for standing by. Welcome to the Wingstop Incorporated Fiscal First Quarter 2017 Earnings Conference Call. Please note that this conference call is being recorded today, May 4, 2017.

On the call, we have Charlie Morrison, Chairman, President and Chief Executive Officer; and Mike Mravle, Chief Financial Officer. I would now like to turn the conference over to Mike. Please go ahead.

Executive
Mike Mravle

Thank you, operator, and good afternoon. By now everyone should have access to our fiscal first quarter 2017 earnings release. If not, it can be found at www.wingstop.com, under the Investor Relations section.

(Forward Looking Cautionary Statements)

Lastly, during today's call, we'll discuss certain non-GAAP financial measures, which we believe can be useful in evaluating our performance. The presentation of this additional information should not be considered in isolation or as a substitute for results prepared in accordance with GAAP, and reconciliations to comparable GAAP measures are available in our earnings release.

With that, I would like to turn the call over to Charlie.

Executive
Charlie Morrison

Thank you, Mike, and hello, everyone. We appreciate your interest in Wingstop. Thank you for taking time to join our call this afternoon. I'd like to begin with a recap of the first quarter and then provide an update on our progress on key initiatives. After that, Mike will review the first quarter financial results and provide an update to our 2017 annual guidance, and then we will open the lines for questions.

We're pleased with the productivity of our development pipeline and improvements in sales trends in the first quarter against a tough industry backdrop. Our same-store sales were down 2.6% at the time of our March 2 earnings call. So, we finished the quarter with domestic same-store sales improving to negative 1.1.

Trends improved at the end of February and into March, as we launched our national advertising campaign and our customers received their delayed tax refund. Our momentum has continued into the second quarter with same-store sales positive 2.3%, excluding the negative overlap of Easter.

Early data shows that our national TV campaign is fostering greater brand awareness for our unique and differentiated brand. We are encouraged by the recent sales trends across all markets, but particularly in markets where we have not historically leveraged TV or radio. We expect the sustained TV and digital presence to continue to build on the momentum established in the first quarter.

During the first quarter, the message of our national commercial focused on our one-of-a-kind brand, singularly focused on our craveable, cook-to-order hand-sauced and tossed wings. The second TV commercial titled No Shortcuts, began airing in early April and reinforces two of our core strategies. One, we don't take shortcuts with our products and also they are made fresh to order, but you can shortcut the wait, by ordering online. Encouraging viewers to order online or through the app will help further drive the conversion to our digital channels.

Online orders command a $4 higher average check than other