Noodles & Company (NDLS) Bundle
A Brief History of Noodles & Company
Company Overview
Noodles & Company, founded in 1995, specializes in serving a variety of noodle dishes, alongside salads and soups. As of October 1, 2024, the company operates 448 locations across the United States, with a focus on providing globally inspired noodle dishes.
Financial Performance
In the third quarter of 2024, Noodles & Company reported total revenue of $122.8 million, a decline of 4.0% from $127.9 million in the same quarter of 2023. Restaurant revenue specifically decreased to $120.2 million from $125.2 million, reflecting a 3.4% decrease in comparable restaurant sales.
| Metric | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Total Revenue | $122.8 million | $127.9 million | -4.0% |
| Restaurant Revenue | $120.2 million | $125.2 million | -4.0% |
| Net Loss | $(6.8) million | $0.7 million | - |
| Basic Loss per Share | $(0.15) | $0.02 | - |
Operational Challenges
For the first three quarters of 2024, Noodles & Company experienced a net loss of $26.5 million, compared to a loss of $3.7 million in the same period of 2023. This increase in loss was attributed to higher interest expenses, which rose significantly to $6.1 million from $3.2 million year-over-year due to increased borrowing and interest rates.
Cost Structure Analysis
During the first three quarters of 2024, total costs and expenses were $391.9 million, an increase of 3.3% from $379.6 million in 2023. Key cost components included:
- Cost of Sales: $91.2 million (decreased by 2.1%)
- Labor: $115.8 million (decreased by 2.4%)
- Occupancy: $35.0 million (increased by 1.8%)
- Other Operating Costs: $71.5 million (increased by 3.4%)
| Cost Component | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Cost of Sales | $91.2 million | $93.2 million | -2.1% |
| Labor Costs | $115.8 million | $118.6 million | -2.4% |
| Occupancy Costs | $35.0 million | $34.4 million | +1.8% |
| Other Operating Costs | $71.5 million | $69.2 million | +3.4% |
Future Outlook
Noodles & Company anticipates capital expenditures between $29 million to $31 million for fiscal year 2024, which will primarily support new restaurant openings and renovations. As of October 1, 2024, the company had cash on hand of $3.3 million and an available credit line of $32.1 million under its A&R Credit Agreement.
Debt and Liquidity Position
As of October 1, 2024, Noodles & Company had $89.9 million in outstanding debt with an average interest rate of 8.67%. The company remains compliant with its debt covenants and expects to meet its liquidity needs through operational cash flows and available credit facilities.
A Who Owns Noodles & Company (NDLS)
Major Shareholders
As of 2024, Noodles & Company (NDLS) has a diverse ownership structure, which includes institutional investors, mutual funds, and individual shareholders. The following table summarizes the major shareholders and their respective ownership stakes:
| Shareholder Name | Ownership Percentage | Type of Shareholder |
|---|---|---|
| BlackRock, Inc. | 12.5% | Institutional Investor |
| The Vanguard Group, Inc. | 10.2% | Institutional Investor |
| Dimensional Fund Advisors LP | 7.8% | Institutional Investor |
| Renaissance Technologies LLC | 5.5% | Hedge Fund |
| Wellington Management Co. LLP | 4.9% | Institutional Investor |
| Other Institutional Investors | 25.0% | Various |
| Insider Ownership | 7.0% | Management and Board |
| Public Float | 27.1% | Retail Investors |
Stock Performance
As of October 1, 2024, Noodles & Company reported a total of 48,102,633 shares issued, with a market capitalization of approximately $210 million. The stock has seen fluctuations in its price, with a year-to-date performance of approximately -15%.
Financial Overview
The financial performance of Noodles & Company for the first three quarters of 2024 is summarized in the following table:
| Financial Metric | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Total Revenue | $122.8 million | $127.9 million | -4.0% |
| Net Loss | ($6.8 million) | $0.7 million | -1077.1% |
| EBITDA | $2.4 million | $8.7 million | -72.5% |
| Basic Loss Per Share | ($0.15) | $0.02 | -850.0% |
Debt and Financial Obligations
As of October 1, 2024, Noodles & Company has reported total indebtedness of $89.9 million, with an average interest rate of 8.67%. The company maintains compliance with its debt covenants and has no off-balance sheet arrangements.
Recent Developments
Noodles & Company has been focusing on restaurant openings and operational efficiency. As of October 1, 2024, the company operates 377 company-owned restaurants and has opened ten new locations in the first three quarters of 2024.
Conclusion on Ownership Structure
Overall, Noodles & Company's ownership structure is characterized by a mix of institutional investors, insider ownership, and a public float, reflecting a broad interest in the company's operations and financial performance.
Noodles & Company (NDLS) Mission Statement
Mission Statement Overview
The mission of Noodles & Company is to provide a diverse menu of globally inspired noodle dishes and other offerings, emphasizing high-quality ingredients and exceptional service. The company aims to create a welcoming environment for its customers while fostering a culture of community and sustainability.
Financial Performance Indicators
As of the third quarter of 2024, Noodles & Company reported the following financial metrics:
| Metric | Q3 2024 | Q3 2023 | Change |
|---|---|---|---|
| Total Revenue | $122.8 million | $127.9 million | Decrease of 4.0% |
| Net Loss | $(6.8) million | $0.7 million (Net Income) | Decrease of $(7.5) million |
| Basic Loss Per Share | $(0.15) | $0.02 | Decrease of $(0.17) |
| Diluted Loss Per Share | $(0.15) | $0.02 | Decrease of $(0.17) |
| Average Unit Volume | $1,272 | $1,335 | Decrease of 4.7% |
Operating Costs and Expenses
The breakdown of operating costs for Q3 2024 compared to Q3 2023 is as follows:
| Cost Type | Q3 2024 | Q3 2023 | Change |
|---|---|---|---|
| Cost of Sales | $30.7 million | $31.5 million | Decrease of 2.5% |
| Labor Costs | $38.4 million | $39.1 million | Decrease of 1.8% |
| Occupancy Costs | $11.5 million | $11.5 million | No Change |
| Other Operating Costs | $24.1 million | $22.6 million | Increase of 6.9% |
| General and Administrative Expenses | $12.9 million | $11.9 million | Increase of 8.7% |
Debt and Liquidity Position
As of October 1, 2024, Noodles & Company reported the following regarding its debt and liquidity:
| Metric | Amount |
|---|---|
| Total Indebtedness | $89.9 million |
| Cash on Hand | $3.3 million |
| Available Credit | $32.1 million |
Restaurant Operations and Performance Trends
In the first three quarters of 2024, Noodles & Company experienced the following trends in restaurant operations:
| Metric | Q3 2024 | Q3 2023 | Change |
|---|---|---|---|
| Comparable Restaurant Sales | (3.4)% | (4.3)% | Improvement of 0.9% |
| Restaurant Impairments | $11.3 million | $1.2 million | Increase of $10.1 million |
| Closure Costs | $1.3 million | $1.0 million | Increase of $0.3 million |
Conclusion of Mission Statement Alignment
Noodles & Company's mission statement reflects its commitment to quality food and customer experience, which is evidenced by its operational strategies and financial performance metrics.
How Noodles & Company (NDLS) Works
Business Model and Revenue Streams
Noodles & Company primarily operates in the fast-casual dining sector, focusing on a diverse menu that includes various noodle and pasta dishes, salads, and soups. The company generates revenue from several key sources:
- Restaurant revenue from company-owned locations
- Franchising royalties and fees from franchise-operated restaurants
- Sublease income from leased properties
Financial Performance
As of October 1, 2024, Noodles & Company reported the following financial metrics for the third quarter:
| Metric | Q3 2024 | Q3 2023 |
|---|---|---|
| Total Revenue | $122.8 million | $127.9 million |
| Net Loss | $(6.8) million | $0.7 million |
| Loss Per Share (Basic) | $(0.15) | $0.02 |
| Average Unit Volume | $1,272 | $1,335 |
| Comparable Restaurant Sales | (3.4)% | (4.3)% |
Operational Metrics
In the first three quarters of 2024, Noodles & Company saw:
| Operational Metric | Q1-Q3 2024 | Q1-Q3 2023 |
|---|---|---|
| Total Revenue | $371.5 million | $379.1 million |
| Net Loss | $(26.5) million | $(3.7) million |
| Restaurant Impairments | $15.5 million | $5.3 million |
| General and Administrative Expense | $39.5 million | $38.0 million |
Cost Structure
Noodles & Company's cost structure is influenced by various operational expenses:
- Cost of Sales: $91.2 million (25.1% of revenue)
- Labor Costs: $115.8 million (31.8% of revenue)
- Occupancy Costs: $35.0 million (9.6% of revenue)
- Other Operating Costs: $71.5 million (19.7% of revenue)
Debt and Liquidity
As of October 1, 2024, the company had:
- Total Debt: $89.9 million
- Cash Balance: $3.3 million
- Available Borrowing Capacity: $32.1 million
Restaurant Development and Closures
In 2024, Noodles & Company opened ten new company-owned restaurants and two franchise locations, while closing seven company-owned and four franchise restaurants. The total number of company-owned restaurants as of October 1, 2024, was 377, along with 94 franchise restaurants across 31 states.
Market Challenges
The company has faced several challenges in 2024:
- Decline in system-wide comparable restaurant sales of 3.3% in Q3 2024
- Increased competition and price sensitivity among consumers
- Higher labor and occupancy costs due to inflation
Future Outlook
Noodles & Company anticipates capital expenditures between $29 million and $31 million for fiscal year 2024, primarily for new restaurant openings and technology investments. The company also aims to continue evaluating its portfolio for potential closures of underperforming locations.
| Future Capital Expenditures | Estimated Amount |
|---|---|
| New Restaurants | $25 million |
| Technology Investments | $5 million |
How Noodles & Company (NDLS) Makes Money
Revenue Streams
Noodles & Company generates revenue primarily through the following streams:
- Restaurant revenue from company-owned locations.
- Franchise royalties and fees from franchise operations.
- Sublease income from leasing out portions of their restaurant spaces.
Financial Overview
For the third quarter of 2024, Noodles & Company reported total revenue of $122.8 million, a decrease of 4.0% compared to $127.9 million in the same quarter of 2023. This decline was attributed to decreased same-store sales, restaurant closures, and the refranchising of six company-owned restaurants.
Revenue Breakdown
| Revenue Source | Q3 2024 (in thousands) | Q3 2023 (in thousands) | Change ($ in thousands) | Change (%) |
|---|---|---|---|---|
| Restaurant Revenue | $120,163 | $125,208 | ($5,045) | (4.0%) |
| Franchising Royalties and Fees | $2,588 | $2,646 | ($58) | (2.2%) |
| Total Revenue | $122,751 | $127,854 | ($5,103) | (4.0%) |
Cost Structure
The company’s costs are primarily categorized into:
- Cost of sales
- Labor costs
- Occupancy costs
- Other operating costs
Cost Analysis
In the third quarter of 2024, Noodles & Company reported the following costs:
| Cost Category | Q3 2024 (in thousands) | Q3 2023 (in thousands) | Change ($ in thousands) | Change (%) |
|---|---|---|---|---|
| Cost of Sales | $30,665 | $31,457 | ($792) | (2.5%) |
| Labor Costs | $38,423 | $39,139 | ($716) | (1.8%) |
| Occupancy Costs | $11,543 | $11,500 | $43 | 0.4% |
| Other Restaurant Operating Costs | $24,124 | $22,558 | $1,566 | 6.9% | Total Costs | $127,551 | $125,820 | $1,731 | 1.4% |
Net Income and Loss
Noodles & Company reported a net loss of $6.8 million for the third quarter of 2024, compared to a net income of $0.7 million in the same quarter of 2023.
Franchise Operations
Franchise operations remain an important aspect of revenue, contributing $7.6 million in the first three quarters of 2024, down from $8.3 million in the same period of 2023, reflecting a 7.9% decrease.
Restaurant Development
Noodles & Company opened ten new company-owned restaurants and two franchise locations in the first three quarters of 2024, while also refranchising six locations.
Average Unit Volume and Comparable Sales
The average unit volume (AUV) for company-owned restaurants was $1,282 for the first three quarters of 2024, down from $1,335 in the previous year. Comparable restaurant sales decreased by 2.6% for the same period.
Debt and Interest Expense
As of October 1, 2024, Noodles & Company had $89.9 million in debt with an average interest rate of 8.67%, an increase from 8.0% in the same period of 2023.
Liquidity Position
The company had a cash balance of $3.3 million as of October 1, 2024, with available borrowings under their credit agreement amounting to $32.1 million.
Conclusion on Financial Performance
Noodles & Company's financial performance reflects the challenges faced in the restaurant industry, including reduced traffic and increased operating costs. The company continues to focus on optimizing its operations and expanding its franchise model to drive future growth.
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Resources:
- Noodles & Company (NDLS) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Noodles & Company (NDLS)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Noodles & Company (NDLS)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.