Shares of the Texas-based restaurant chain Zoe’s Kitchen (NYSE:ZOES) went diving down after the company released its first-quarter financial results on Thursday.
Although the company showed improvements, the results fell short of estimates predicted by analysts, according to The Motley Fool.
Total revenue increased by approximately 12.7% to $102.1 million, compared with the $90.6 million that the company saw in the first quarter of the previous year. Analysts expected Zoe’s Kitchen total revenue to reach around $104.7 million.
Analysts also expected a loss of $0.01 per share during this quarter, while Zoe’s saw a net loss of $0.13 per share, or $2.6 million.
>>Red Robin Shares Dive Almost 20% After Release of Q1 Financial Earnings
Comparable restaurant sales also decreased by 2.3%, which the company attributes to a 4.4% decrease in transactions.
Zoe’s President and CEO, Kevin Miles, has said that the company saw challenging results during the first quarter which included “weather and calendar shifts” and “decelerating dine-in traffic.”
Miles continues to say that Zoe’s is “taking steps to reduce [its] G&A infrastructure and will re-allocate resources towards marketing and technology initiatives to drive sales.”
The company is “encouraged by results coming from investments in digital, delivery, and menu innovation.”
>>America’s Car-Mart: Financials and Valuations Support Stock Uptrend
Outlook for the rest of fiscal 2018 has also been adjusted. Total revenue for 2018 is exepcted to reach anywhere between $345 million and $352 million, lower than the previously estimated $358 million to $368 million.
Comparable restaurant sales are also expected to decrease by 2% to 4%, which has been revised from a decrease of 0% to 2%.
Zoe’s Kitchen still plans to open 25 company-owned restaurants throughout the rest of the year.
Shares of the company fell over 40% on Friday and, closed at a share value of $8.66. Zoe’s was able to reach a high share value of $10.35 and a low of $8.65
Comparatively, the company closed at a value of $14.90 on Thursday afer reaching a high of $15.11 and a low of $14.40.
Featured Image: twitter
