The coronavirus pandemic has led American companies to leverage the internet to reach consumers, and the same can be said of Wendy’s.
With the help of its loyalty program, the digital arm of the fast-food chain is on track to obtain a larger share of the company’s total sales well ahead of schedule, according to CEO Todd Penegor, who appeared on CNBC on Wednesday -market.
The company now expects digital to represent 10% of sales in 2021.
“We didn’t think we would reach 10% by 2024, pre-pandemic,” Penegor told Jim Cramer in a “Mad Money” interview. “What we are doing is directing a lot of active users to our app and people are engaging with the app. We are seeing a lot more mobile orders and that really is because there is a benefit.”
Wendy’s was also successful on the breakfast menu launched last year. Although fewer Americans came to the office during the pandemic, interrupting their chances of stopping at a restaurant for a morning sandwich or coffee, breakfast sales accounted for about 7% of total sales last year, the company said.
Penegor remained optimistic about being competitive with other restaurants in the morning run. He expects the breakfast menu to account for 10% of sales by the end of 2022.
“The breakfast business is doing very well in the face of the pandemic,” he said. “For us, being able to deliver a 7% sales mix on our breakfast portion is quite remarkable and super encouraging. … What we are seeing is a strong repetition.”
Earlier on Wednesday, Wendy’s released fourth quarter results that did not meet Wall Street estimates, both at the top and in the result. The company posted total revenue of $ 474.3 million in the quarter, 11% up from $ 427.2 million a year ago, and net profit of $ 38.7 million, an increase of 46% over $ 26.5 million. According to FactSet, analysts had expected revenues of about $ 476.6 million and net income of $ 39.9 million.
For the full year, Wendy’s recorded $ 1.73 million in revenue, an increase of 1.5%, and $ 117.8 million, down 14% compared to 2019.
Sales of the same restaurant in the US increased 5.5% in the quarter and 2% for the full year.
Wendy’s shares fell more than 5% on Wednesday, closing at $ 20.12.